The History

What Happened in 1913

In a single calendar year, three sweeping structural changes fundamentally restructured American governance. All under one president. All products of the Progressive Era.

February 3, 1913

The 16th Amendment

The Federal Income Tax

The 16th Amendment granted Congress the power to levy a federal income tax without apportioning it among the states by population. This overrode the Supreme Court's 1895 ruling in Pollock v. Farmers' Loan & Trust Co., which had struck down a previous income tax as unconstitutional.

Before 1913, the federal government funded itself primarily through tariffs and excise taxes, indirect taxes that flowed through commerce. The states served as intermediaries between citizens and the federal government. The 16th Amendment changed this fundamentally: it gave Washington direct taxing power over individual citizens, bypassing the states entirely.

The original income tax was modest: a 1% tax on incomes above $3,000 (roughly $93,000 today), with a top rate of 7% on incomes over $500,000. Proponents argued it would only affect the wealthy. Within a few years, rates climbed dramatically to fund World War I, reaching 77% by 1918.

Why it matters:

The income tax created a direct financial relationship between the federal government and every working American. It provided the revenue engine that would fund the massive expansion of federal power throughout the 20th century: from the New Deal to the Great Society to the modern regulatory state.

April 8, 1913

The 17th Amendment

Direct Election of Senators

The 17th Amendment changed how U.S. Senators are selected, from appointment by state legislatures (as the Founders designed in Article I, Section 3 of the Constitution) to direct popular election.

This was not a minor procedural tweak. The Founders deliberately created a bicameral legislature with two different selection methods for a reason: the House represented the people; the Senate represented the states. This was a critical structural check. State legislatures chose senators who would defend state sovereignty against federal overreach. Senators answered to the state governments that appointed them, not to campaign donors or national party machinery.

The 17th Amendment severed this connection entirely. Senators became, in effect, super-Representatives, elected by popular vote, accountable to the same political dynamics as the House, and increasingly dependent on national fundraising rather than state interests.

Why it matters:

The states lost their direct structural representation in the federal government. Without senators accountable to state legislatures, there was no institutional mechanism to resist federal encroachment on state authority. The balance of federalism shifted decisively toward Washington, and has never shifted back.

December 23, 1913

The Federal Reserve Act

America's Central Bank

Signed into law by President Woodrow Wilson on December 23, 1913 , two days before Christmas, with many members of Congress already home, the Federal Reserve Act created the Federal Reserve System: America's central bank.

The system established twelve regional Federal Reserve Banks, controlled by private member banks, overseen by a central Board of Governors appointed by the President. It was given the power to issue currency, set interest rates, and regulate the money supply, powers that directly affect every American's savings, wages, and cost of living.

The Fed operates with a degree of independence from both Congress and the President that is unique among government institutions. Its deliberations are conducted in private. Its chair testifies before Congress but is not subject to direct congressional control. It is, in practice, the most powerful unelected institution in American governance.

Why it matters:

The Federal Reserve controls the money supply, interest rates, and inflation, forces that shape every American's economic reality. Yet it operates with limited transparency and minimal direct democratic accountability. Whether you believe the Fed is a necessary stabilizing force or an opaque center of unaccountable power, greater transparency is a reasonable demand.

The Combined Effect

Together, these three changes in a single year:

  • Gave the federal government direct taxing power over individuals
  • Removed the states' structural check on federal power in the Senate
  • Created a central banking system with vast monetary authority and limited oversight

All under Woodrow Wilson. All products of the Progressive Era. A single year that reshaped the architecture of American governance, and set the trajectory for the century that followed.

But 1913 was not the end of the story. It was the beginning. These structural changes didn't just shift power; they set in motion a cascade of consequences that continues to shape American life today.

The Downstream Effects

The Cascade: What 1913 Set in Motion

The three changes of 1913 were sparks. What followed was a century of structural drift: each consequence building on the last, each further concentrating power and eroding the checks the Founders designed. Understanding these downstream effects is essential to understanding what needs to be reformed today.

1

A Congress That Serves Itself

From citizen-legislators to career politicians

The Founders envisioned citizen-legislators who would serve for a time and return to private life, subject to the same laws they passed. The modern Congress bears no resemblance to this vision.

The 17th Amendment transformed the Senate from a deliberative body of state representatives into an elected chamber driven by the same forces as the House: fundraising, media cycles, and partisan loyalty. Both chambers are now populated by career politicians whose primary skill is getting reelected, not governing.

The numbers tell the story. The average tenure in the House has roughly doubled since the early 20th century. Reelection rates routinely exceed 90%. Members spend an estimated 30 to 70 percent of their time fundraising rather than legislating. The seniority system rewards longevity over competence, concentrating committee power in the hands of those who have held their seats the longest.

The result is a Congress that is structurally optimized for incumbency, not representation. Members are incentivized to avoid hard votes, delegate authority to the executive branch and regulatory agencies, and focus on the performative aspects of politics rather than the substantive work of lawmaking. Congress has become a body that voluntarily surrenders its own power (to the president, to agencies, to party leadership) because doing so is politically safer than exercising it.

The connection to 1913:

Direct election of senators created a Congress where both chambers answer to the same electoral pressures, and the same donor class. The income tax created a federal budget so vast that controlling it became the ultimate prize, incentivizing permanent incumbency. The result is a legislature that has abandoned its constitutional role as the primary check on executive power.

2

The Money Machine: Campaigns, Lobbying, and Capture

How fundraising replaced representation

When senators were appointed by state legislatures, they didn't need campaign war chests. They needed the confidence of their state government. The 17th Amendment changed their incentive structure overnight: now they needed money, lots of it, to win statewide popular elections.

This transformed the relationship between money and governance. The modern campaign finance system (Super PACs, dark money, bundlers, and the revolving door between Congress and K Street) is a direct downstream consequence of making every federal elected office a popular election requiring massive fundraising.

Meanwhile, the income tax created a federal budget worth influencing. When the government spends trillions of dollars, every line item becomes a target for lobbying. The tax code itself (now tens of thousands of pages) is a monument to special interest influence. Every exemption, deduction, and credit represents someone's successful lobbying effort.

The result is a system where access to elected officials is effectively purchased, where legislation is shaped by those who fund campaigns rather than those who cast votes, and where the gap between public opinion and public policy grows wider every year.

The connection to 1913:

The 17th Amendment created the demand for campaign money by making senators run popular elections. The 16th Amendment created the supply of influence by building a federal budget worth lobbying for. Together, they built the infrastructure for the modern campaign finance crisis.

3

The Erosion of Federalism

States reduced to administrative units

The Constitution created a federal system, a union of sovereign states that delegated specific, enumerated powers to a national government. The states were not administrative subdivisions of Washington. They were co-sovereigns with their own authority, their own governments, and their own representation in the federal legislature through the Senate.

The 17th Amendment removed the states' direct representation. The income tax gave Washington the financial power to bypass states entirely, taxing citizens directly and then offering money back to states with strings attached. Federal grants, mandates, and conditional funding became tools for imposing national policy on state governments that theoretically retained sovereignty.

Today, states are financially dependent on the federal government. Federal funding comes with federal rules. State legislatures spend much of their time complying with federal mandates rather than governing according to the preferences of their own citizens. The laboratories of democracy that the Founders envisioned (fifty states experimenting with different approaches to governance) have been largely replaced by a one-size-fits-all federal model.

The connection to 1913:

The income tax gave Washington direct revenue that didn't flow through state governments. The 17th Amendment removed the states' advocates in the Senate. The combination left states without the financial independence or political representation to resist federal centralization.

4

The Blurring of Constitutional Roles

When no one does their job, everyone does someone else's

The Constitution assigns distinct roles to each branch of government. Congress makes the laws. The president executes them. The courts interpret them. This separation of powers was the Founders' primary defense against tyranny.

The downstream effects of 1913 have systematically blurred these boundaries. Congress delegates its legislative authority to executive agencies, which write regulations with the force of law. The president issues executive orders that function as legislation. Courts are asked to settle policy disputes that Congress refuses to address. The Federal Reserve makes economic decisions with fiscal consequences that properly belong to Congress.

The result is a government where no one is clearly responsible for anything. When regulations harm citizens, Congress blames the agencies. When the president overreaches, Congress lacks the political will to push back. When economic policy fails, the Fed and Congress point at each other. Accountability requires clarity of role, and the structural changes of 1913 and their consequences have destroyed that clarity.

The connection to 1913:

The Federal Reserve created a powerful institution outside the traditional three branches. The income tax funded an administrative state that blurs legislative and executive functions. The loss of state-appointed senators removed the body most invested in maintaining clear federal boundaries. The cumulative result is a government where constitutional roles are suggestions, not constraints.

5

The Rise of the Imperial Presidency

From chief executive to near-sovereign

The Founders designed a presidency with limited, enumerated powers: a chief executive who would faithfully execute the laws Congress passed, not write them. The president commanded the military but could not declare war. He could veto legislation but could not legislate by decree.

The 1913 changes accelerated a shift that was already underway. With unlimited taxing power funding an expanding federal apparatus, and with the Senate no longer structurally tethered to state interests, the institutional counterweights to presidential power weakened. The executive branch grew, and kept growing.

Today, presidents routinely govern by executive order, wage undeclared wars, invoke emergency powers that bypass Congress, and direct sprawling regulatory agencies that write rules with the force of law. The administrative state (the vast bureaucracy of federal agencies) answers to the president, not to Congress or the people. Executive power has expanded under presidents of both parties, because the structural incentives reward expansion regardless of who holds the office.

The connection to 1913:

The income tax gave the executive branch the revenue to build an enormous federal apparatus. The loss of state-appointed senators removed the institutional body most likely to resist federal (and executive) overreach. The Federal Reserve gave the president influence over monetary policy through Board appointments. Together, they created the conditions for the imperial presidency.

The Pattern Is Clear

Every downstream consequence traces back to the same structural changes. The imperial presidency, the permanent Congress, the campaign money machine, the erosion of federalism, the blurring of constitutional roles: these are not unrelated problems. They are symptoms of the same disease: a government whose structural architecture was fundamentally altered in 1913, and which has been drifting further from its design ever since.

This is why targeted reform is not enough. Fixing campaign finance without addressing the 17th Amendment treats a symptom. Limiting executive power without restoring Congress's institutional incentives treats another. The 1913 Project advocates for structural reform, changes to the architecture of governance itself, because that's where the problems originate.

See the full reform agenda →