"Bring back the 91% tax rate"! The lead headline on the Drudge Report is sure to fire up conservatives - not to mention anyone who favors our current less draconian tax scheme.
Drudge's source for the 91% call is leftist economist Paul Krugman, who looks to the 1950s tax code to argue that "you can have prosperity without demeaning workers and coddling the rich."
In the '50s, the top marginal tax rate was 91%, the wealthiest paid an effective rate of 70% - and, says Krugman, that was a huge factor in America's unprecedented prosperity. "The high-tax, strong-union decades after World War II were in fact marked by spectacular, widely shared economic growth," writes Krugman, adding that median family incomes doubled between 1947 and 1973 - a shocking contrast with the stagnant middle-class incomes of the last two decades.
The post-war tax code made that happen, Krugman writes - and if we're nostalgic for the golden-era economy of the 1950s, "we can do that again."
How about cut spending by getting rid of the Departments of Energy, Education, Housing and Urban Development, Commerce and Interior, cutting back on the Defense Budget and Welfare Budget. And not revise the Tax Code, throw it out! Get rid of Income Tax all together. Any Conservative that supports Income Tax isn't a true Conservative. The Government shouldn't own our labor!! That is the single most Socialist ideal there is.
@Fishbone345 That's really extreme! We need those departments, and we need more taxes to fund them! Only a traitor would propose getting rid of them, and your the only one proposing to get rid of them so I guess that makes you a...
@Suff - Calling someone a traitor for expressing his opinions is my definition of extreme. I don't know if I agree with getting rid of those departments, but they could be trimmed down quite a bit. As for income taxes, they are the direct result of prohibition. Those wanting to outlaw a popular recreational drug on the federal level, in order to get that legislations passed, had to find a way to compensate the government for the +30% of their revenues that would be lost by outlawing alcohol. Ergo, income taxes. Those who refuse to read history deserve to repeat it.
This doesn't make any sense. Who will raise minimum wage? Oh the government. What's the percent of a person's income that you consider a fair percent to pay? How much should those hated nasty wealthy people,(working hard and being, dang them all to he11!, successful) get to keep out of each dollar they make? If those nasty old rich people would just pay more than 70% of all taxes, why they world would be just peachy, right? Heck, let them keep a dime of every dollar they make, yeah! That'll show them for being uppity and being successful and smart and working hard and doing all the stuff needed to be a success. HAH! Yeah, take it all away and give it to, whom should the government give it to again? You perhaps? But then YOU would be the ugly rich person that everyone hates. Oh, and who the heck do you think is investing back into the community right now? The poor man or the wealthy man? Hmmm, how many foundations do the poor have to give back to their communities? Hmmmm? Sounds like someone has a bit of a problem.
I think you don't understand how tax policy works. For example, everyone pays the same tax rate on the first 20 thousand of taxable income, as well as on the first 50 thousand, etc. when you pass a threshold to go into a new tax bracket, it is only the amount over that threshold that is taxed at the higher rate, not the entire income. No one is really suggesting a return to 90% top tax rates, only a return to 1990's era tax rates and even then, only on the amount of taxable income over 250 thousand.
@kramresim1 As an accountant I understand perfectly just how income tax works. Your rate is the amount you pay on your highest dollar earned. Read the article, that's exactly what it says, progressives have been salivating over the Eisenhower high tax rates for the wealthy for years now. That's exactly what they want. If you want the Clinton tax rates, just cutting them off for the 2% won't even be a drop in the bucket. See, despite all the rhetoric that the rich got the best tax break, the majority of the money lost in revenue was lost due to the tax cuts to the 98% not the other way around. According to the Washington Post, the loss of revenue by extending the tax cuts for the 2% would be $50 billion in 2013, to extend them for only the 98% will be a loss of revenue of $223 billion in 2013. Seems to me the piddly $50 B, which would run the country for about a week would be a waste of time. What would help, and what all those who are screaming for a tax hike for the "rich" would totally vote down big time, would be to let them all expire, that would increase revenue in 2013 to $273 billion, that would run the WH for a few months and at least and everyone would be doing their patriotic duty by supporting their government. As to the amt. on the dollar, right now, all told with all taxes paid, we are getting about 50 cents on the dollar, take more of that, reduce it to even 40 cents or so and we will retire. It's not worth it to work to simply pay taxes when 50% of the workforce pays none. From our POV, that's pretty unfair to have half the workers pay for the other half, especially when that other half is screaming for us to pay even more, to "pay our fair share". Well, I counter, perhaps THEY should pay their fair share too.
No, even if you are in the top bracket, you don't pay the top rate on all of your income, only the amount above the threshold for that amount of income. You obviously are out of touch with how hard it is to be poor to want them to pay more in taxes and suffer cuts in services to protect the wealthy. Personally, I have no problem letting all the bush tax cuts expire and taxing capital gains and all other income at the same rates as earned income. That along with some budget cuts should help bring down the deficit.
@kramresim1 Okay, what part of what I wrote did you not understand? I thought I made it quite clear that the bracket you are put in is based on the last dollar you earn. If one makes 500k that puts them in the 35% rate and they will pay that 35% rate on every dollar over the $249,999.99 that is the next down rate. Really, it's just not that difficult to understand and why you want to insist that I don't know or understand the tax code is ludicrous. I know how hard it is to be in the lower income groups, we were there, but we always managed to pay fed. tax too. Your problem is that you have been listening to the lies and misinformation fed you by the DNC. No one wants to protect the wealthy. We just want tax fairness. Where is the equality in half paying all the taxes? What that does, and this is a hard truth for the left to understand, is make that other half not care how the government spends the money and makes them the largest voice in raising taxes, on everyone else. They are perfectly fine with that but definitely not fine with any cut in any service no matter how small. That's no way to run a government. I say either make all cuts permanent or all cuts expire. No playing favorites. Sure, raise the cap. gains. You have heard the rhetoric, unfortunately, it really will kill business and investment and jobs. No investors? No expansion, no jobs and GDP at the same miserable 1.5% we have today. Bush's tax cuts helped after the dot.com bust and 9/11 but revenue didn't start flowing in in a big way until cap. gains were cut. Just go to the IRS website and then to revenue history. It's all there in black and white, no spin, no opinion and no lies. If you tax cap. gains as ordinary income, Wow, well, good luck with that. Who in their right mind would invest already taxed at the highest rate income just to have it taxed the second time at the highest tax rate? An idiot might think it was a good idea, investors wouldn't or would invest and not take any profit until the tax climate was better. Either way, income from cap. gains would go way down.
Besides, the rich could, at the time, afford a high tax rate because they were making lots of money. They were making lots of money before it started because they hadn't already been paying such high taxes.
@Tralee Sure. Google "Wealth Distribution US 2012." You'll find the figures I stated were the most conservative. Some claim that it's so bad that 50% of the wealth is held by 1% of the population, which could be true. That's one reason I find cries of woo from the rich to be crying wolf.
The idea that the rich will leave the country is a straw man. There is absolutely no evidence to support this. They certainly didn't leave back when the tax rate was 91% and they won't today. Let's just try it and see. We'll raise the tax rate to 91% and see if it helps. It sure can't do any worse than the Reaganomics that have decimated the middle class.
@FFX_VA There is NO evidence to support the notion that the rich would leave the country. They certainly did not during the time when the tax rate was 91% and they won't do it now. Moving from state to state is not the same thing and you know it.
@PNWest That's not an experiment I'm willing to risk our future on. I wasn't around in the 50's so I can't refute your first hand knowledge that no one moved out back then, but the history books clearly state it was a very, very different world than the one we live in today so your statement they won't move is pure speculation. Eisenhower got it right, I speculate Obama won't.
@FFX_VA You didn't have to be around in the 50's (or 30's through 60's) to read the history of the era. What I said was true. Eisenhower had a 91% top marginal tax rate for all of the years he was President. Damn right he had it right. You cannot present a single iota of evidence that a low tax rate on the rich helps the economy - not one. We have had the lowest marginal rates since the 1920 for the last 10 years. The results - very few jobs and the rich getting richer at the expense of the poor and middle class. That is the modern day facts. I have presented historical evidence that a high marginal tax rate on the rich works and that a low marginal tax rate on the rich fails. It's pretty straight forward. Show me some hard evidence to the contrary. The idea that you are not willing to experiment is not evidence. Neither are your speculations.
The country built the largest middle class in the history of the world with a highest marginal tax rate of at least 70%. We have had over 10 years of the Bush tax cuts for the wealthy - where are the jobs? All we have to show for this is a smaller middle class and a wider gap between the rich and the rest of us. It's time to go back to something that actually worked. Raise the marginal tax rate to 70% or more on incomes higher than $1M. Leave the rates the same on everyone below $100K. Pay down the debt and stimulate the economy. Don't let the GOP hold 98% of us hostage in order to give tax breaks to those who don't need it.
Oh, yeah...the fabulous 50s. What a joke that was. I saw my father lose his business because no one could afford to hire any work done. He went to work for Civil Service to earn a living. By 1959, that job was shut down and he had to move half across the country to keep working. Eisenhower's interstate system got all the federal money. The people where I lived were hurting then.
The liberals are bound and determined to have big business's and the wealthy flee the country, so they can have their socialistic Utopia of government dependent servants and government controlled business. Then who's going to pay the bills? The "entitlement" collectors wont give up their freebies. They've earned those government checks by supporting Barry. They will throw a fit. What the uneducated don't want to understand is... "If the government can give it to you, then the government can/will take it away"
@PNWest - Yeah, I caught that but still... work yourself really hard, come up with a successful business and you get 9 cents and the government gets 91? To me it sounds like a complete reversal of what a lot of CEO's want now - employees work their butts off for chump change while management rakes it in.
@Lorth That's the idea. Instead of the rich getting richer - everybody does better. It worked before and it will work again. It would drive down the debt and narrow the gap between the ultra rich and the rest of us.
Why leave the 9% on the table? If prosperity is through larger government, consider that extra 9% a downpayment for our future. Just think of all the "gifts" you can get from the money stolen from the rich.
Gosh, those poor rich people. They're so helpless! All a rich guy has on his side is massive amounts of cash to lobby politicians, private armies, gated communities, vacation homes on three continents, and pals they went to college with who run the multinational conglomerates that he doesn't. And raising their taxes is just like taking rice from the mouth of a starving toddler, isn't it? Tsk. It's terrible the way our nation preys on the most helpless among us (the rich) to help aid the most powerful among us (starving toddlers.) We should protect and coddle the rich and find a way to have the toddlers work at their factories so they can become even richer!
@LGRepublican I don't think 90% is appropriate but you'll not catch me crying for people so wealthy their lifestyle will not be impacted one tiny bit if they pay slightly higher taxes. They profited very nicely being citizens of our nation; they can pay for the services they use and, yeah, if they feed a few hungry children with their taxes, too, good.
@Zazziness Hard work and sacrifice had something to do with success as well. Perhaps if the parents of those "hungry children" would have shown a little more of those qualities, they wouldn't be in the position they're in now. In other words, take more of their work ethic and less of their money.
@LGRepublican I'm all for hard work and creativity resulting in increased rewards. I'm also keenly aware we have an entrenched noble class in this country which is passing down wealth generation to generation and many of them wouldn't know what work is if it bit them in the behind. Bottom line? I'm not going to ever advocate letting children starve because of the mistakes of their parents.
well , you would have to bring back the 1950s moral and ethical codes as well as the 1950s work ethic. Good luck. Truthfully , this is where it all started to go down hill. The last generation to endure hardship before the new prosperity set in. Yes, we had the Korean and the Viet Nam war but those wars didn't require the sacrifice of the American public at home like WWII. This is the new generation of the entitled, the spoiled, and the give me free stuff and immediate satisfaction. There are good people here don't get me wrong but the downward spirals starts with the following generations with a couple of notable exceptions like the Civil Rights movement.
Bring back the 50's music! Ban the Bieber!! The 50's economy was good because Eisenhower (R) put in place the right combination of low taxes, balanced Federal budgets, and conservative public spending that allowed the economy to hum along at a steady clip without inflation. Obama & this Congress will never achieve that.
I'm with you on the Bieber thing but I think we just have to wait a few more months. Teen idols all come with a limited shelf life. I'm afraid I have to disagree about the fifties. We too often attribute properity to politics when they aren't connected. The fifties were properous because the steel industry was booming, our natural resources were still overflowing, and product innovations were frequent. (Real innovations, not minor tweaks to existing technology.) The American consumer was buying American goods and Unions had made the working class properous enough many, many people were constantly circulating money through the system. All very different than today, I'm sorry to say.
Here's a thought. If we bring back the 91% tax rate from the 50's, how about we bring back the spending levels of the 50's as well? You know, about 24% of GDP vs. 39% today. 1.9% of GDP on welfare vs. 3% today. Oh, but we couldn't POSSIBLY do that....
Sure thing just bring back all the deductions that one could take up until 86 and I'll be fine with it. What most bozos don't know is that even with a 91% tax rate that we had back then the effective tax rate still wasn't 91%. Since the end of WWII tax rates have been as low as 28% and as high as the aforementioned 91% and yet during that entire time the total tax revenue collected by the federal government as a percentage of GDP has averaged roughly 17% during that entire 67 year time span. Long story short it doesn't matter what the Government does in regards to tax policy, they're never going to collect much more than what they are collecting now and it certainly won't solve the wealth disparity issue in the U.S.
It wouldn't help. Enough is never enough. The only two things government is actually good at. Spending money and figuring out ways to spend more money. Which is no surprise to any of us. John Adams said "There are two ways to conquer and enslave a country. One is by the sword. The other is by debt." Guess what? We are done. At this point we are just like the chicken running around the yard with it's head cut off. There's no hope. We keep putting the same party's with the same mentality's in power so nothing ever really changes except who's getting the majority of the hand outs when power is passed back and forth. We have people who see the writing on the wall and are talking about leaving the country. But what they don't know is even if they and give up there citizenship they are still subject to U.S. federal income tax on what they make in there adopted country and subject to extradition back if they don't pay. On top of that just about every assets they have is subject to confiscation. There is no escape but death and they tax that to.