http://www.taxpolicycenter.org/taxfacts/displayafact.cfm?Docid=213
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Yahoo search results for "tax rates" "historical"
Government needs to lower taxes, and get out of everybody's hair.
Either they do it, or we will.
/johnny
“Flourishing” is a relative term.
Houses were smaller. Most families had one car (if any). Medical care was about what you’d get at a minor emergency center, at best.
Basically, everyone’s standard of living was probably about the level of what the poor/lower-middle class is today.
I don’t know the numbers but Kennedy wouldn’t have run on reducing taxes if this were true. Remember we were still recovering from FDR and the war in the fifties.
These 4 happy conditions no longer exist. The moral evil of confiscatory tax rates aside, low marginal tax rates are now utterly necessary (as well as a number of other things) for the US economy to resume flourishing.
Insofar as your leftist acquaintances are working, whether they admit it or not, for the destruction of the US, they will perforce also support higher marginal tax rates.
I am not that old but the did have ratio write-offs. The largest was 1017-1 so if you put a dollar in your company you got to deduct 1017. You could also deduct all interest on credit cards, hell everything was deductible get a copy of 1950’s tax return.
I watch bryan gumbal on good morning America (that goes way back) they had a guy put his tax return on tv. He made over 1 million dollars and after doing his taxes he got a refund of over 300,000.
The reality is although the rates were sky high, so were the number of deductions one could take that effectively wiped out the rates. When Reagan created his tax cuts, the receipts to the Treasury more than doubled because he also took away many of the traditional deductions like medical and credit cards.
In 1952 U.S. Steel Corp. alone made more steel than the rest of the world put together. There was little if any competition, there was pent up demand from WWII, and we were rebuilding Europe and Japan. We had not created a welfare state and the top rates applied to much higher relative incomes IIRC. There is no comparison to today.
"Considering that the top marginal tax rate for the wealthiest Americans today is 35 percent, that figure seems astounding. But it's true that in the 1950s, the top marginal tax rates were over 90 percent.
So does that mean that someone in 1955 making a half million dollars had to fork over $450,000 of it to Uncle Sam? No.
We are talking here about "marginal" tax rates. Moore doesn't go out of his way to explain this, so we will. The marginal tax rate is the top rate of income tax charged to individuals on their last dollar of earnings. So in 1955, for example, when the top marginal tax rate was 91 percent, that was the tax rate owed on a person's income over $300,000. That person would, however, pay 20 percent on the first $2,000 of income; 21 percent on the next $2,000 in income; 24 percent on the next $2,000 and graduated on up to the highest rate. On average, a person making, say, $500,000 would pay substantially less than 90 percent of their income in federal taxes.
The top marginal tax rates peaked in 1952 and 1953 at 92 percent for income over $300,000.
Bob Williams of the Tax Policy Center:
In 1952 and 1953, Williams said, when the top income tax rate was 92 percent for income over $300,000, a person would have to make waaaay more than $300,000 to actually end up paying an average of 90 percent of their income. According to Williams, someone would have to make $2,328,400, and therefore pay $2,095,560, to get to that 90 percent threshold.
But people with income of less than $2.3 million — remember we're talking about 1952 and 1953 — would have paid, on average, something less than 90 percent, and perhaps much less.
Still, Moore's point is valid. The top marginal tax rates paid by the richest Americans were far higher in the 1950s than they are now. In 2009, the top marginal rate was 35 percent on income above $372,958. And although Moore didn't use the term "marginal tax rate," he did say "top tax rate." People without CPAs might mistake that for a person's average tax rate (it's not), but it's valid wording. And so we rule this one Mostly True."
Personally, I really don't care how today's tax rates stack up against those in the 50s. It clear that billions are being wasted by the lard-arses in government. Give that money back to those that earned it.
http://www.taxpolicycenter.org/taxfacts/displayafact.cfm?Docid=213
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Yahoo search results for "tax rates" "historical"
Yep, income taxes were higher. The difference was that they didn’t have all the rules and regs that kept businesses from expanding and new ones from starting up. The economy took off even better once the war time tax rate was abolished, but then the greenies gained the upper hand sometime in the late 70s, early 80s and businesses started failing and new businesses were unable to get started as easily.
This doesn’t give actual tax rates but is a lengthy series of quotes from JFK pointing out that lower taxes increase revenue. He talks about how it increases employment etc.
http://www.wnd.com/news/article.asp?ARTICLE_ID=39517
When you compare tax rates you also have to include all the hidden tax rates such as on electric service or phone.
That said, there used to be a lot LOT more deductions. Thus, someone at the 60% level might only pay an actual 20%. When Reagan lowered the progressive rates, the vast array of deductions were also trimmed back heavily to a shadow of what they were.
Finally, “The Wealthy” used to be wealthy. However, the jump off point for “high income earners” has dropped enormously as a factor of buying power. In the 50’s someone who made enough to own a large home with a pool in a nice neighborhood was considered middle class. Now they are considered “the wealthy”.
The people who can or will do the essential things that others can't or won't are paid the most. They comprise the top 10%. When you tax that top 10% heavily, then those people, can and will raise their rates of compensation. What you are left with are stupid people voting to sock it to those evil rich people, but who instead effectively increase their own costs of essential items and services.
Think of it this way. Ten people come to my water stand in the middle of the desert, where I have dug a well. They get mad that I have done well selling water for a $1 a glass, so they vote to put a 90% on desert water sales. In turn, I raise the price of my water to $10 a glass, and the morons think they've ripped me a new one. Of course, there is also the possibility that I will just cap my well and they'll die of thirst.
Our economy flourished in the 1950’s, in part, because much of industrial Europe and Japan had been destroyed during WW II. Hence, there was much less competetion than today.
Some on this thread generalized that overall one cannot compare the 1950's to today. The major basic advances in electronics during the 1950's were already in embryo such as the transistor; today's advances in medicine are largely in diagnostics which flow from electronics. In general, advances today over the 1950's are in application, technique and refinement not fundamental like the transistor.
The 1950's were fun.
Top US Marginal Income Tax Rates, 1913--2003
Mr. Wilson would have paid 91% on $252,156 w/o the myriad loopholes. He probably got a refund. :)
The truly salient point is made by SAJ. For ten years after WW2, the rest of the then-industrialized world was in utter smoking ruin. The rest of the world could absorb any and everything the US could produce.
Even so, I believe there was a significant, though quite normal (especially compared to what our current circustances are) recession circa 1957-1958 that really crunched car sales. The Edsel came out and was not only not-market-friendly, but it came onto the market when Buicks and Chevys weren’t selling as well as they had in the prior 5 years. It was as if the US had tooled up for infinite expansion post-WW2 and overshot in terms of estimating the demand....which is absolutely the most normal thing there is in the business cycle...and the excess capacity had to be “burned off”...an utterly typical inventory correction which productive economies go through every so often.