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need help refuting leftist claims about 1950s tax rates
self

Posted on 10/09/2010 10:42:15 AM PDT by mainestategop

Im preparing to write an article about Liberal myths and lies concerning Bush Reagan and Obama and I keep coming back to this claim that liberals have been making on youtube and several other places that in the 1950s taxes on the wealthy were at an all time high and our economy was flurishing. Any old timers from that bygone era care to comment? Has anyone heard this?


TOPICS: Education; History; Reference
KEYWORDS: 1950s; leftists; liberals; taxandspend; taxes; taxrates
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To: franksolich
Nobody, but nobody, ever paid 90% (or whatever) in income taxes.

I'm not sure but I seem to remember someone telling me that back then most people didn't pay any income tax at all since the lowest rate didn't kick in until around $10K. Back then if you made $10K it was something. I think of the scene in the movie It's a Wonderful Life where George Bailey is offered a job making $20K/year and he's in shock.

If the tax rate is 90% but nobody makes enough to pay it, it's not doing any economic damage. The problem comes as inflation kicks everyone's wages up but those tax brackets don't move with it. This is why inflation is such a stealth tax.

51 posted on 10/10/2010 7:09:07 AM PDT by YankeeReb
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To: Pontiac
Also in the Obama Care bill was a new tax on rental income.

Is this true??? One more reason why I despise Hussain!!!. I just purchased a property back in 2007 with the intent of moving into it. As we all know housing and the economy tanked shortly after so I was out of work. Since I couldn't sell w/o a major loss and I was lucky enough to be able to rent it out, I've been able to hold onto it. Now you tell me that Hussain has screwed that idea!?! I tell you, I can't wait to see the kenyan wearing an orange jump suit and ankle bracelet picking up trash by the side of the road.

52 posted on 10/10/2010 7:22:28 AM PDT by YankeeReb
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To: YankeeReb
Is this true???

So I have read.

If I can’t sell I will have to raise the rent to copensate.

Perhaps you can do the same.

53 posted on 10/10/2010 7:27:31 AM PDT by Pontiac
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To: JRandomFreeper; All

I agree. That is what needs to be done.


54 posted on 10/10/2010 7:43:23 AM PDT by Democrat_media (Why is no government creating a product we can hold in our hands like a cell phone..?)
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To: franksolich

Hemingway still paid through the nose. In his last weeks he was having delusions(?) about the Feds coming to get him.


55 posted on 10/10/2010 9:11:28 AM PDT by gundog (Help us, Nairobi-Wan Kenobi...you're our only hope.)
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To: RangerM

The point is that the COUNTRY had the best economy in history, the 50’s being known by historians and economists as the golden age, the Middle Class was BORN, and even at 92% TMR, the rich did FINE. The TMR was in the 90’s from 1952-1963, mainly Eisenhower. FDR’s previous TMR was 94% at one time.

Those are easily verified facts which you should research to satisfy yourself.

Oh - and since BC/BS (employer supplied) was a NONPROFIT, it paid 100% of all claims from dollar one - there was no such thing as a copay.

Old timer here - born in 1945. When I was a kid our 4-family house was worth $10K (suburban eastern MA) my father made about $20K as a state highway tree surgeon (and he retired with a good pension & HC,) family of 4 groceries for the week (a station wagon full of bags) was about $25, a loaf of bread was (I think) 15-25cents, and I think a new car cost between $1-2K. Gas was 25 cents a gallon. Sorry, it’s not easy to remember that far back, but that’s pretty accurate for age around 10-12 (1955 or so.)

And the cars were nice looking, all steel, easy to work on, and lasted a lifetime.

BTW-our house and all the neighbors’ houses were huge. And we wanted for nothing. All bills were paid on time, and no loans were taken out.


56 posted on 07/29/2011 4:03:23 AM PDT by rhytonen
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To: rhytonen
Almost nobody paid that 92% rate due to the tax deductions available at the time. And the total amount of taxes collected by the government has remained relatively stable (~19-20%) regardless of the tax rates over history. Google "Hausers Law" if you don't believe me.



Notice how flat that brown line is? That's the level of revenue, and it hasn't changed much even as the rates have.

In the '50s, the country was still producing goods for the rest of the world than hadn't caught up yet from the ravages of WWII.

There are still non-profit health insurance companies today.

http://www.nonprofithealthcare.org/

Healthcare costs have risen as technology has provided more advanced treatments. If you want to limit yourself to '50s era healthcare, your costs would be minimal, and your premiums low.

You had a nice house, food, and cheap fuel, along with a life expectancy 10-15 years less than today.

Today we have $4.00 gasoline, (expectations of) McMansions, I-Phones, High speed internet access, Cable TV (plasma or LCD, of course), vacations that often involve Airplanes/Ships, and so many other baubles (that didn't exist in your youth).

Times have changed. Some for good, and some for bad.
57 posted on 07/29/2011 5:13:13 AM PDT by RangerM
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To: RangerM

I did.
here’s what I found.
Hauser’s”law” is as preposterous a misrepresentation as the infamous “Laffer Curve.” Conservatives have been trying to prove the “trickle down” and (tax cuts and subsidies will “stimulate”)”job creators” myths for far too long now, and in the face of logic and historic fact to the contrary in both cases.

Economists have been “laffing” at both pseudoeconomic theories since the Right Wing “Think Tanks” and conservative administration advisors *coughpropagandamills* released them in Right Wing publications like Murdoch’s wsj.

“...this is beyond awful. It confuses what may be a desire of the American people not to be taxed beyond 19.5% of GDP, under a variety of tax systems, with an unfounded claim that the American people could not be taxed at a higher rate (on GDP) than 19.5%.

Specifically, it ignores the base-broadening that has accompanied much of the reduction in the top marginal tax rate. It ignores the increasing contribution to revenues played by the payroll tax, which has nothing to do with the top marginal tax rate. It is not robust against the standard Laffer curve critique—it will eventually not hold up for a sufficiently low top marginal tax rate. And the list could be extended. These shortcomings are obvious to anyone who takes just a moment to consider the claim, and yet the Wall Street Journal publishes it. They have no one to blame but themselves for the low regard in which they are being held. “

http://www.angrybearblog.com/2010/11/hausers-law-is-extremely-misleading.html

http://seekingalpha.com/article/78256-lying-with-charts-wsj-edition

http://capitalgainsandgames.com/blog/andrew-samwick/329/beyond-awful-wall-street-journal

http://elidourado.com/blog/debunking-hausers-law/

I believe if you KEEP soaking the rich, eventually they will run out of ways to cheat the tax laws - or even better, JUST LEAVE ALTOGETHER and make room for businessmen who are honest and responsible. In fact, given the mess they’ve made of the American quality of life, we need to claw back as much as humanly possible by OUTLAWING and POLICING those tax havens. This GROSS inequality will eventually cause the noted behavior in other Banana Republics - violent revolt and lawless chaos.


58 posted on 08/16/2011 10:46:04 PM PDT by rhytonen
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To: rhytonen
I'm not certain exactly how your examples exactly "debunked" anything, considering there wasn't (as far as I can tell) a definitive relationship that could be established that corrects for economic trends. Sure, there have been times of greater and lesser revenues (as a percentage of GDP), but the percentage has hovered around 20%. Sure, you can raise tax rates today, and gain revenues tomorrow, until the economy adjusts to the new paradigm, and revenues decline the day after.

Heres some more figures for you to chew on.

Income taxes are only a portion of the taxes Americans pay to the Federal government. Americans pay income, payroll, excise, and corporate taxes to the Federal government.

According to the CBO (in 2007)..

The TOTAL effective Federal individual tax rate (all personal taxes including payroll/excise/corporate) is as follows....

Lowest Quintle 4.0%
Second Quintile 10.6%
Third Quintile 14.3% (This is where the median would be)
Fourth Quintile 17.4%
Fifth (Highest) Quintile 25.1%

Average for all quintles is 20.4%.



Here's something that many people aren't aware of......

Most people are aware that income taxes are paid by those in the top half of all households, but also believe the proportion of taxes paid by all quintiles evens out once you include payroll (and other) taxes.

This is not true.

According to the CBO (in 2007) the percentage of all federal taxes paid including income/payroll/corporate/excise taxes is as follows:

Lowest Quintle 0.8%
Second Quintile 4.4%
Third Quintile 9.2%
Fourth Quintile 16.5%
Fifth (Highest) Quintile 68.9%

Top 10% 55.0%
Top 5% 44.3%
Top 1% 28.1%

See that? That means the top 40% of all households in America pay 85.4% of all Federal taxes (NOT just income taxes). The Top 10% pays more than half.



How about Social insurance (a.k.a. payroll) taxes? (see same link above)

Lowest Quintle 4.8%
Second Quintile 10.8%
Third Quintile 16.6%
Fourth Quintile 24.7%
Fifth (Highest) Quintile 42.9%

Interesting don't you think that the Top 40% pay 2/3 of all payroll taxes?

So the next time you hear somebody say the "rich don't pay their fair share", you can let them in on the secret.
59 posted on 08/18/2011 7:48:20 PM PDT by RangerM
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To: RangerM

Top 10% 55.0%
Top 5% 44.3%
Top 1% 28.1%

You have just identified why we now are an Oligarchy.

“Progressive” taxation...illustrated here...by you...is the ONLY means by which the very rich-who can buy anything they want otherwise-can buy a government. And We the People have sold it to them...and then wonder what happened to the Constitution.


60 posted on 08/18/2011 7:57:58 PM PDT by mo
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To: mo

It’s the Golden Rule. (He who has the gold.....)

It’s true no matter the economic system you’re living under. Only the medium of exchange differs.


61 posted on 08/19/2011 5:02:14 AM PDT by RangerM
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To: mainestategop

A liberal co worker hit me up with this crap yesterday.

the answer which requires some thought to understand; the 91% rate came with mountains of deductions for cars, bar tabs, etc that made it a hollow joke that no on actually paid.

The “bumper sticker” answer - I’m fine with taking income tax rates back to 1950’s levels if the spending (especially on entitlements) is also adjusted back to 1950’s levels.


62 posted on 11/21/2012 6:17:41 AM PST by Harold Stoney
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