All posts by Scott Reynolds Nelson


Lessons From America’s First Fiscal Cliff

Coxey’s Army in Washington, D.C., in an image from the Library of Congress

America faced its first fiscal cliff in 1893. The date should be familiar. It was the start of the Panic of 1893, and it led to the biggest shift ever in the composition of the U.S. Congress. Contemporaries called it the “Avalanche of 1894.”

Then as now, a Republican-sponsored change in tax policy brought about the crisis. Throughout the 1880s the United States had run a budget surplus. Americans paid no income tax, but a…