It’s quite simple… we switched away from tariffs because the tax burden fell mostly on the working-class while the robber barons got away with paying almost nothing.
In a pre-industrial feudal system, this was to be expected for a few main reasons:
- Life expectancy was very low, around 40 years as of 1900.
- The average person had only a few years of education.
- Infant mortality was around 30% before the industrial revolution.
Productivity and income were so low that it’s hard to get data on how much we were actually making, but when you consider that the US GDP per capita was $3000 in 1960 versus over $80,000 now, it is easy to see that productivity and quality of life was much lower before the income tax was implemented.
The reality is that people lived short lives, had very little schooling, a third of children died before they turned 1, and the quality of life was not even that good. By any metric you look at, the quality of life in this “golden age” before the income tax wasn’t that golden.
Income taxes are a better tax system, though if your main goal is to make billions of dollars and not pay anything, you would generally look back at the Gilded Age as a golden era.
But not so much for the rest of us.