While Andrew Mellon and presidents Warren G. Harding and Calvin Coolidge are rightly credited with proposing and shepherding through Congress tax reform legislation in the 1920s that radically reduced marginal tax rates on wealthy individuals from WW I highs, it is less well known that a similar change very likely would have occurred even under Democratic administrations. Basically, the Mellon plan was originally authored by former and holdover Treasury officials from the Wilson administration, who fully intended to formulate a permanent peacetime taxation system that would best serve a modern industrial society.
One of a group of businessmen and bankers who influenced, maybe even dominated, American policy in the 1920s, S. (for Seymour) Parker Gilbert left his mark on cornerstone tax policy as well as on foreign policy. I’ll devote a set of 3 posts to this little-known man who crammed a lot of service into his short life.
Part 1: Mastermind of tax reform
Born in New Jersey in 1892, Gilbert studied at Rutgers before graduating from Harvard Law School in 1915. He then joined the prestigious New York City law firm of Cravath and Henderson. With the entry of the U.S. into World War I, Gilbert joined the war loan staff at the Department of Treasury, then led by William G. McAdoo, where he served until appointed assistant secretary of the Treasury for fiscal affairs at the age of 27. A Republican, he was a close friend and associate of Russell C. Leffingwell who preceded him in the fiscal affairs position.