You Can't Soak the Rich

[Brainonska511]

Originally posted by: dullard
Hmm, lets look at the numbers in the middle of each major rich tax rate. I got my data from the BEA (goes back to 1929).

1929: top tax rate = 24%. Federal current receipts as percent of GDP: 10.1%
1933: top tax rate = 63%. Federal current receipts as percent of GDP: 15.2%
1937: top tax rate = 79%. Federal current receipts as percent of GDP: 15.5%
1941: top tax rate = 81%. Federal current receipts as percent of GDP: 18.8%
1943: top tax rate = 88%. Federal current receipts as percent of GDP: 24.0%
1945: top tax rate = 94%. Federal current receipts as percent of GDP: 23.0%
1947: top tax rate = 86%. Federal current receipts as percent of GDP: 22.7%
1949: top tax rate = 82%. Federal current receipts as percent of GDP: 20.1%
1953: top tax rate = 92%. Federal current receipts as percent of GDP: 23.9%
1958: top tax rate = 91%. Federal current receipts as percent of GDP: 23.2%
1966: top tax rate = 70%. Federal current receipts as percent of GDP: 25.7%
1975: top tax rate = 70%. Federal current receipts as percent of GDP: 27.0%
1984: top tax rate = 50%. Federal current receipts as percent of GDP: 28.3%
1989: top tax rate = 28%. Federal current receipts as percent of GDP: 29.4%
1992: top tax rate = 31%. Federal current receipts as percent of GDP: 29.0%
1997: top tax rate = 40%. Federal current receipts as percent of GDP: 30.7%
2005: top tax rate = 35%. Federal current receipts as percent of GDP: 29.1%

As you can see, dropping the top tax rate BOTH increased AND decreased the tax revenues as % of GDP. It isn't simple like in the OP's article. It certainly isn't a straight line at 19.5% of GDP. The only real conclusion we can make is that over time the federal government got bigger.

You realize, no one ever paid those top tax rates in the 50s. You'd be an idiot if you did.

 

[Robor]

Originally posted by: dmcowen674

Originally posted by: winnar111
winnar111
Senior Member

Posts: 541
Joined: 03/10/2008

I wonder whether Obama's people are reading this, and how they figure to pay for his new social programs.

I wonder how much you are paid by the McCain campaign.

I suspect there's a few on the McCain payroll here.

 

[Craig234]

Originally posted by: dullard
Hmm, lets look at the numbers in the middle of each major rich tax rate. I got my data from the BEA (goes back to 1929).

1929: top tax rate = 24%. Federal current receipts as percent of GDP: 10.1%
1933: top tax rate = 63%. Federal current receipts as percent of GDP: 15.2%
1937: top tax rate = 79%. Federal current receipts as percent of GDP: 15.5%
1941: top tax rate = 81%. Federal current receipts as percent of GDP: 18.8%
1943: top tax rate = 88%. Federal current receipts as percent of GDP: 24.0%
1945: top tax rate = 94%. Federal current receipts as percent of GDP: 23.0%
1947: top tax rate = 86%. Federal current receipts as percent of GDP: 22.7%
1949: top tax rate = 82%. Federal current receipts as percent of GDP: 20.1%
1953: top tax rate = 92%. Federal current receipts as percent of GDP: 23.9%
1958: top tax rate = 91%. Federal current receipts as percent of GDP: 23.2%
1966: top tax rate = 70%. Federal current receipts as percent of GDP: 25.7%
1975: top tax rate = 70%. Federal current receipts as percent of GDP: 27.0%
1984: top tax rate = 50%. Federal current receipts as percent of GDP: 28.3%
1989: top tax rate = 28%. Federal current receipts as percent of GDP: 29.4%
1992: top tax rate = 31%. Federal current receipts as percent of GDP: 29.0%
1997: top tax rate = 40%. Federal current receipts as percent of GDP: 30.7%
2005: top tax rate = 35%. Federal current receipts as percent of GDP: 29.1%

As you can see, dropping the top tax rate BOTH increased (eg from 1958 to 1996 or from 1975 to 1984) AND decreased (eg from 1945 to 1949 or from 1997 to 2005) the tax revenues as % of GDP. It isn't simple like in the OP's article. It certainly isn't a straight line at 19.5% of GDP. The only real conclusion we can make is that over time the federal government got bigger.

That's a hugely oversimplified, apples and oragnaes use of those numbers. The top tax rate was not something many taxpayers paid. You apparently ignore business taxes.

A better chart would be to show the tax rate paid by the most wealthy who were subject to that top rate - and a chart showing the bigger tax picture.

As I recall business paid the lion's share of income taxes back around the 50's, a figure that has reversed.

The issue I saw was whether increasing the top tax rate increases the taxes paid by the rich. Your data does not say whether it does IMO.

 

[Craig234]

Originally posted by: CitizenKain

Originally posted by: winnar111

Originally posted by: lupi

Originally posted by: Craig234
As the Fair Deal (FDR) showed, it's plenty possible to increase the share the wealthy (who get all that wealth from society) pay back to society.

There is some issue with the crippling of the ability of democracies' ability to tax, but given that the US has the lowest taxes in the industrialized world, we're dragging them down.

Comrade, socialist countries are >>>

Enjoy the trip.

This is the same FDR who initiated the social security tax of 1% of first $2000 of income, if I recall, and the same FDR who sold billions in war bonds because he didn't have enough money.

Would this be the same FDR who was running the country while fighting 2 wars while bringing the country out of a massive depression?

Isn't it interesting that the same people who argue that any government role in the economy other than minimal regulating is harmful, also say that WWII spending was what 'got our economy on track' - which was the government effectively throwing billions of dollars into complete economic waste (ships, tanks, military aircraft, guns, bombs that add nothing to the economy), but only using government spending to stimulate employment - and these same people say that the government spending big money on things that are actually productive for the economy - education, construction - would cause harm?

There's a complete contradiction in their position, but ideology tells them not to pay any attention.

 

[dullard]

Originally posted by: Craig234
That's a hugely oversimplified, apples and oragnaes use of those numbers. The top tax rate was not something many taxpayers paid. You apparently ignore business taxes.

I'm just following the formula prescribed by the OP. If you wish to do better, go right ahead, I'd like to see the data.

1) I saw "you can't soak the rich" as the title, so I focussed on the rich tax rate. I could just as easilly have written a tax rate for the middle class, but it wouldn't affect the results much.
2) I also saw in the OP: "The federal tax "yield" (revenues divided by GDP) has remained close to 19.5%, even as the top tax bracket was brought down from 91% to the present 35%." So, that is what I did, I showed the top tax bracket and the effect. Guess what, it wasn't even close to 19.5% in any of those years nor was it flat.

You are very correct, that what I posted wasn't the complete picture. I just posted enough to show that the OP's article is complete garbage. I'd like someone to take the time to do better than what I did though.

As for the business tax, please add that into my work. Then tell me which portion of the population got the business profits (ie who owned the businesses which paid a significant amount of tax).

 

[Craig234]

Originally posted by: dullard

Originally posted by: Craig234
That's a hugely oversimplified, apples and oragnaes use of those numbers. The top tax rate was not something many taxpayers paid. You apparently ignore business taxes.

I'm just following the formula prescribed by the OP. If you wish to do better, go right ahead, I'd like to see the data.

1) I saw "you can't soak the rich" as the title, so I focussed on the rich tax rate. I could just as easilly have written a tax rate for the middle class, but it wouldn't affect the results much.
2) I also saw in the OP: "The federal tax "yield" (revenues divided by GDP) has remained close to 19.5%, even as the top tax bracket was brought down from 91% to the present 35%." So, that is what I did, I showed the top tax bracket and the effect. Guess what, it wasn't even close to 19.5% in any of those years nor was it flat.

You are very correct, that what I posted wasn't the complete picture. I just posted enough to show that the OP's article is complete garbage. I'd like someone to take the time to do better than what I did though.

Sounds like we're in agreement, and I hope my comments weren't too harsh, someone using data at all here is a nice change

I've posted some of the data in the past, but it usually takes a couple hours to compile much and create a post.

I don't care for when people try to say the government can't tax the rich more and their only choice is to leave the taxes lighter on the rich.

Unfortunately, that comment invites someone to try to argue 'but the rich pay a lot', without noting that they're now getting all the nation's economic growth after inflation.

While 80% of Americans are flat or negative in increase, the top 0.01 who make the most are up hundreds of percent.

 

[QuantumPion]

Originally posted by: Thump553
Imagine that, the Wall Street Journal came out with another editorial in support of the rich. Who would have thought that?

Everyone that you disagree with is wrong.

Everyone that you agree with is right.









Makes sense, saves you the trouble of having to come up with an actual counter-argument or debate. Since you are always totally correct on every issue, there's no need to bother with all those worthless alternative viewpoints!

 

[QuantumPion]

Originally posted by: Brainonska511

You realize, no one ever paid those top tax rates in the 50s. You'd be an idiot if you did.

And what makes you think the rich would/do pay higher tax rates today? Hence, the OP's original point.

 

[blackangst1]

Originally posted by: Harvey

"You" can speak for yourself. Last time I checked, when a large segment of that small segment known as "the rich" got that way by stealing their wealth from everyone else, and the rest of us have no money left, what "you" would do in your idealistic, unregulated "capitalism at any cost" society is irrelevant.

Most of the wealthy didnt get rich by stealing or taking advantage of anyone. Walmart? Sam saw a need and created a company to fill it. Your statement smells of the assertion wealth is static. I know you know better.

Originally posted by: Harvey
When the nation needs funds to recover from the crimes committed by some of "the rich," and "the rich" are the only ones left to "soak," as Willie Sutton said when asked why he robbed banks, "Because that's where the money is."

Capitalism is not a crime.

Originally posted by: Harvey
Of course, many good people who became wealthy though hard, honest, productive work and good, honest investments will be hurt. They are as much victims of those who gamed and raped the financial system as anyone else, although they probably won't suffer as much as those left broke, jobless and/or homeless.

Agree

 

[Craig234]

Originally posted by: blackangst1

Originally posted by: Harvey

"You" can speak for yourself. Last time I checked, when a large segment of that small segment known as "the rich" got that way by stealing their wealth from everyone else, and the rest of us have no money left, what "you" would do in your idealistic, unregulated "capitalism at any cost" society is irrelevant.

Most of the wealthy didnt get rich by stealing or taking advantage of anyone. Walmart? Sam saw a need and created a company to fill it. Your statement smells of the assertion wealth is static. I know you know better.

Why, yes, Sam invented the idea of a general store, to get people basic products.

You think just maybe there's more to the story how it became the world's largest retailer?

Some of it is legit - very innovative and efficient distribution.

Some of it is gray - such as the extremely aggressive business practices.

Some of it is dark gray - from the dishonest 'Made in the USA' advertising campaign while selling mostly Chinese-made goods and playing a big part in the loss of US manufacturing, to the extremely aggressive prevention of any union activity with 'hit squads' who fly to stores where there are any activities seen, to the abuse of workers (such as forcing off the clock activity), and those are just part of the story.

Originally posted by: Harvey
When the nation needs funds to recover from the crimes committed by some of "the rich," and "the rich" are the only ones left to "soak," as Willie Sutton said when asked why he robbed banks, "Because that's where the money is."

Capitalism is not a crime.[/quote]

He didn't say it is. Disengenuous misrepresentation of what he said. He said some of the rich commit crimes. I'd further expand that there are 'moral crimes'; if something is a crime, but you pay off the government to legalize it so it's not technically a crime any more, are you then perfectly fine morally?

Originally posted by: Harvey
Of course, many good people who became wealthy though hard, honest, productive work and good, honest investments will be hurt. They are as much victims of those who gamed and raped the financial system as anyone else, although they probably won't suffer as much as those left broke, jobless and/or homeless.

Agree

 

[Harvey]

Originally posted by: blackangst1

Capitalism is not a crime.

Unbridled capitalism can be a crime. If everyone was their own better angels, there would be no need for government. We would all follow the teachings of our best leaders, our best beliefs and our best faith in the best will of everyone else, and those who were fortunate enough to succeed and gain wealth beyond their wildest dreams, let alone their needs, would help those less fortunate than themselves, especially those whose very survival was in jeopardy.

The current financial disaster is proof that isn't reality.

The preamble to the Constitution of the United States of America says:

We the People of the United States, in Order to form a more perfect Union, establish Justice, insure domestic Tranquility, provide for the common defence, promote the general Welfare, and secure the Blessings of Liberty to ourselves and our Posterity, do ordain and establish this Constitution for the United States of America.

Our leaders, who swore an oath to protect and defend out Constitution and all that it represents, and who are charged with oversight of our financial institutions, have instead abandonded their sworn duty to protect all of our citizens and instead, supported and profited from the greed of those who established a system that rewarded thoes who raped that system at the expense of the vast majority of our citizens.

How does that "insure domestic Tranquility, provide for the common defence, promote the general Welfare, and secure the Blessings of Liberty to ourselves and our Posterity?" :roll:

 

[jonks]

Originally posted by: Vic
Not to worry, the rich are currently 'soaking' themselves.

"Forbes named the three richest men in America this week: Bill Gates, Warren Buffett and Larry Ellison. As of Friday their combined wealth was more than Eight Thousand Dollars." - SNL Weekend Update

 

[shira]

Originally posted by: gardener
Cut taxes for rich people who show their gratitude by outsourcing jobs. How does cutting taxes for rich people help GDP?

It is comforting to see the right wing hasn't forgotten how to misuse the Laffer curve, ie, "all tax cuts increase tax revenues".

I believe it was, "Tax cuts pay for themselves," a notion that has been thoroughly discredited.

The real lesson of history is that the economy grows over time whether you increase, decrease, or maintain tax rates. But decreased tax rates increase deficits.

 

[chess9]

Originally posted by: Brainonska511

Originally posted by: dullard
Hmm, lets look at the numbers in the middle of each major rich tax rate. I got my data from the BEA (goes back to 1929).

1929: top tax rate = 24%. Federal current receipts as percent of GDP: 10.1%
1933: top tax rate = 63%. Federal current receipts as percent of GDP: 15.2%
1937: top tax rate = 79%. Federal current receipts as percent of GDP: 15.5%
1941: top tax rate = 81%. Federal current receipts as percent of GDP: 18.8%
1943: top tax rate = 88%. Federal current receipts as percent of GDP: 24.0%
1945: top tax rate = 94%. Federal current receipts as percent of GDP: 23.0%
1947: top tax rate = 86%. Federal current receipts as percent of GDP: 22.7%
1949: top tax rate = 82%. Federal current receipts as percent of GDP: 20.1%
1953: top tax rate = 92%. Federal current receipts as percent of GDP: 23.9%
1958: top tax rate = 91%. Federal current receipts as percent of GDP: 23.2%
1966: top tax rate = 70%. Federal current receipts as percent of GDP: 25.7%
1975: top tax rate = 70%. Federal current receipts as percent of GDP: 27.0%
1984: top tax rate = 50%. Federal current receipts as percent of GDP: 28.3%
1989: top tax rate = 28%. Federal current receipts as percent of GDP: 29.4%
1992: top tax rate = 31%. Federal current receipts as percent of GDP: 29.0%
1997: top tax rate = 40%. Federal current receipts as percent of GDP: 30.7%
2005: top tax rate = 35%. Federal current receipts as percent of GDP: 29.1%

As you can see, dropping the top tax rate BOTH increased AND decreased the tax revenues as % of GDP. It isn't simple like in the OP's article. It certainly isn't a straight line at 19.5% of GDP. The only real conclusion we can make is that over time the federal government got bigger.

You realize, no one ever paid those top tax rates in the 50s. You'd be an idiot if you did.

Yes, exactly right, because Congress also passed, with the infamous 1954 Tax Code, a host of deductions, credits, write-offs and gimmicks (like straddles), that put most of the rich into the ZERO TAX LIABILITY category. It was a tax accountant's dream come true-basicly a relief act for lawyers and accountants.

-Robert

 

[ElFenix]

i support the underlying argument that the best way to increase taxes is to increase growth.

 

[blackangst1]

Originally posted by: Harvey

Originally posted by: blackangst1

Capitalism is not a crime.

Unbridled capitalism can be a crime. If everyone was their own better angels, there would be no need for government. We would all follow the teachings of our best leaders, our best beliefs and our best faith in the best will of everyone else, and those who were fortunate enough to succeed and gain wealth beyond their wildest dreams, let alone their needs, would help those less fortunate than themselves, especially those whose very survival was in jeopardy.

The current financial disaster is proof that isn't reality.

The preamble to the Constitution of the United States of America says:

We the People of the United States, in Order to form a more perfect Union, establish Justice, insure domestic Tranquility, provide for the common defence, promote the general Welfare, and secure the Blessings of Liberty to ourselves and our Posterity, do ordain and establish this Constitution for the United States of America.

Our leaders, who swore an oath to protect and defend out Constitution and all that it represents, and who are charged with oversight of our financial institutions, have instead abandonded their sworn duty to protect all of our citizens and instead, supported and profited from the greed of those who established a system that rewarded thoes who raped that system at the expense of the vast majority of our citizens.

How does that "insure domestic Tranquility, provide for the common defence, promote the general Welfare, and secure the Blessings of Liberty to ourselves and our Posterity?" :roll:

Although I agree with *some* of your rant, your ties to capatalism are nothing but blind partisanship. All your blah b;ah blah come on man. Stay on topic.

Just MHO

 

[blackangst1]

Originally posted by: chess9

Yes, exactly right, because Congress also passed, with the infamous 1954 Tax Code, a host of deductions, credits, write-offs and gimmicks (like straddles), that put most of the rich into the ZERO TAX LIABILITY category. It was a tax accountant's dream come true-basicly a relief act for lawyers and accountants.

-Robert

GJ ignoring the rest of the graph.

 

[Harvey]

Originally posted by: blackangst1

Although I agree with *some* of your rant, your ties to capatalism are nothing but blind partisanship. All your blah b;ah blah come on man. Stay on topic.

Just MHO

That's interesting. You agree with at least *some* of what I said, but in your confused opinion it's all just "blah b;ah blah." Exactly which "blah" or "b;ah" did you agree with?

The fact is, without regulation in the public interest, SOME individuals WILL abuse their positions of wealth and its attendant power for the same reason that SOME individuals WILL commit crimes and abuse the rights of others.

That is precisely the meaning of the preamble to the Constitution. "We the People," through our elected represenatives in Congress, are charged with establishing and maintaining our society in the best interests of all of our citizens.

Providing for "the common defence" includes defending against domestic predators as well as foreign attackers. Promoting the general Welfare and securing the Blessings of Liberty to ourselves and our Posterity includes providing and securing them for all of our citizens, not just the top few percent who contribute to their political campaigns. Establishing Justice includes equal access not only to the courts, but to the opportunities and rewards of our economic system.

And if you really want to see a failure to maintain domestic tranquilty, consider what can happen to a few rich, powerful and greedy people when they're confronted by enough of the population who are so poor and unable to feed themselves and their kids that they feel they have nothing left to lose.

Ask Marie Antoinette about how well she kept her head under such circumstances. :shocked:

 

[Veramocor]

Two thoughts, I'd like to see if the burden of taxes increased for the non-top brackets and by how much on the same chart. If you increase other taxes to make up for a decrease in the top bracket of course revenues will be constant

Second, Taking this to its absurd conclusion if we cut all taxes to 0, the tax intake will stay 19.5%. That's why I call if the laughable curve.

 

[zephyrprime]

repost.

 

[blackangst1]

Originally posted by: Harvey

Originally posted by: blackangst1

Although I agree with *some* of your rant, your ties to capatalism are nothing but blind partisanship. All your blah b;ah blah come on man. Stay on topic.

Just MHO

That's interesting. You agree with at least *some* of what I said, but in your confused opinion it's all just "blah b;ah blah." Exactly which "blah" or "b;ah" did you agree with?

The fact is, without regulation in the public interest, SOME individuals WILL abuse their positions of wealth and its attendant power for the same reason that SOME individuals WILL commit crimes and abuse the rights of others.

That is precisely the meaning of the preamble to the Constitution. "We the People," through our elected represenatives in Congress, are charged with establishing and maintaining our society in the best interests of all of our citizens.

Providing for "the common defence" includes defending against domestic predators as well as foreign attackers. Promoting the general Welfare and securing the Blessings of Liberty to ourselves and our Posterity includes providing and securing them for all of our citizens, not just the top few percent who contribute to their political campaigns. Establishing Justice includes equal access not only to the courts, but to the opportunities and rewards of our economic system.

And if you really want to see a failure to maintain domestic tranquilty, consider what can happen to a few rich, powerful and greedy people when they're confronted by enough of the population who are so poor and unable to feed themselves and their kids that they feel they have nothing left to lose.

Ask Marie Antoinette about how well she kept her head under such circumstances. :shocked:

What I dont agree with is youre preamble rant. The paragraph above it I agree with. The key word being *may* in the first sentence