Time Machine: Quaker's campaign for lower taxes

CEO prodded workers to protest ballooning rates in '53

  • Photo

From 1950 to 1952, as the United States ramped up military spending for the Korean War and President Harry Truman labored to balance the federal budget, the taxes paid by average Americans increased drastically.

The federal tax burden had risen from an estimated $271 per person to $431, according to the non-profit Tax Foundation.

John Stuart, the CEO of Quaker Oats, decided to do something about it.

On Jan. 27, 1953, Stuart initiated a plan to talk to employees in 17 Quaker plants nationwide about what he saw as government waste and inefficiency. He felt that workers didn’t understand why they needed to take an interest in taxes and didn’t realize that they shouldered a large part of the load.

In Cedar Rapids, Stuart told workers at the Quaker plant that 33 cents of every dollar they earned was going to taxes.

“That’s the tax load the average person doesn’t understand,” Stuart said. “We hope to convince employees that they have a real interest in this economy. They believe corporations and the rich pay the big tax load. That isn’t supported by facts.”

Along with education about taxes, workers were encouraged to write letters to their senators and representatives in Congress to protest high tax rates. Employees who participated became members of a group with the acronym IGHAT — pronounced “ee-gat” — that stood for “I’m Gonna Holler About Taxes.”

IDEA GROWS

The Quaker Oats plants in communities around the country extended invitations to local civic organizations to join the campaign.

Other companies on whose boards Stuart served, including International Harvester and Sears Roebuck, also joined.

A few days after Stuart announced the campaign, Quaker’s Chicago headquarters was swamped with letters and telegrams from businessmen and civic groups asking for more information about IGHAT.

The campaign’sa first official roll-out came at a luncheon meeting in Cedar Rapids on Jan. 30, where the Civic Bureau of the Chamber of Commerce decided to sponsor the campaign citywide.

At the next meeting in March, 75 representatives of business and industry heard from Quaker officials on how they could promote the endeavor. The Civic Bureau was ready to furnish businesses with advertising materials and posters and assist with displays or answer questions.

VISUALS ADDED

The Quaker plant opened its drive at 6 a.m. on March 5 with large signs, departmental displays and workers performing skits dramatizing the bite taxes took from their paychecks. The Cedar Rapids events were delayed until March 10 to avoid a conflict with a special school election.

Letter-writing stations were set up in plants to encourage workers to write to their congressmen. They were given white-and-blue IGHAT pins for their efforts.

Quaker salesmen reached out to grocers, asking them to set up displays of $1,100 worth of groceries — the average amount families earning $3,400 annually paid in taxes.

After seeing how IGHAT spread in Cedar Rapids, Stuart expected to see similar results in other communities.

General Electric began the drive in its 98 plants and sponsored an IGHAT meeting in New York for eight of the largest East Coast corporations.

LOUD & INSISTENT

By mid-March, 38 states had joined, putting pressure on politicians for tax relief. The Tax Foundation said never had the public insistence on tax reduction been so loud or so insistent.

With backing from the National Conference of State Taxpayer Organizations, the movement’s momentum was bolstered by support from Sears Roebuck, International Harvester, General Electric, American Farm Bureau Federation, Erie Railroad, Grocery Manufacturers of America and Montgomery Ward.

A stamp was issued by the National Conference of State Taxpayer Organizations depicting a family dressed in barrels standing in front of the U.S. Treasury Building with the words. “It’s no joke, I’m broke!”

The letter-writing campaign began to be felt in Washington by March 18, the day after Cedar Rapids’ campaign ended, when several hundred letters were delivered to Iowa Rep. Henry. Talle’s office, along with telegrams and a number of phone calls. There were no form letters. Each was personally written. Aides spend the day opening the letters, one of which came from Cedar Rapids Quaker Oats Manager Ted Petranek.

By March 23, Iowa’s U.S. Sens. Bourke Hickenlooper, a Republican, and Guy Gillette, a Democrat, had also received mounds of letters, petitions, telegrams and some phone calls backing IGHAT.

THE POLITICS

The swelling campaign attracted the attention of Democrats, who pointed out that Quaker’s founding Stuart family was Republican; that Donold Lourie, Quaker’s president, had resigned to become under-secretary of state for President Dwight Eisenhower; and that one of Quaker’s directors was Eisenhower’s brother, Milton. The Democratic National Committee cried foul, declaring the campaign an advertising campaign for Quaker.

The Gazette added an editor’s note to its coverage of the controversy: “The IGHAT campaign, idea of Quaker Oats officials in Chicago, was first proposed publicly at a meeting of a representative group of Cedar Rapids businessmen. Quaker officials asked: Should we go ahead with this project? The businessmen were unanimous they should.

“Quaker officials realized that IGHAT might not please the Eisenhower administration at this time because of Eisenhower’s announced stand of balancing the budget before cutting taxes. Quaker officials — backed by the business organizations and newspapers all over the country — said they wanted the budget balanced, but they also wanted to tell administration officials that economy is of first importance in the reorganization of their departments and is necessary to be able to reduce taxes. ...

“Quaker Oats officials hoped to avoid giving the impression that it was a publicity stunt to promote its products. Its aim was to get the tax project started and let others carry it on. When large organizations in many parts of the country took up the IGHAT campaign, Quaker Oats told The Gazette, ‘It’s out of our hands now.’ ”

In the end, the campaign, while it generated a lot of energy and publicity, did not change tax policy. President Eisenhower had campaigned on reducing taxes, but when he took office in 1953, he found reducing taxes would hurt national security and efforts for a balanced budget. He reversed his campaign stance and refused to seek the tax cut demanded by IGHAT. The nation nonetheless entered into years of economic growth and development.

l Comments: (319) 398-8338; d.fannonlangton@gmail.com

Like what you're reading?

We make it easy to stay connected:

to our email newsletters
Download our free apps

Give us feedback

Have you found an error or omission in our reporting? Tell us here.
Do you have a story idea we should look into? Tell us here.