The wealthy have the advantage over the less affluent in that they can manage their income to avoid taxes.
The income tax is a tax waged on income as defined by law. The wealthy will manage their income to circumvent the highest rates of taxation.
Recently so of the highest earners (corporate officers) have used stock options to do this; diverting their compensation in to the form of stock options to take advantage of the lower tax rates on capital gains (profits from the sale of stock, real estate and other physical assets as defined by law).
The point being that people can be resourceful in tax avoidance and in avoiding taxes they change their behavior. These changes in behavior will cause the financial markets and the economy in general to move in directions that are not necessarily beneficial to the country or the world.
I personally am changing my behavior this year to try to avoid taxes. I am the owner of a rental property. If Obama is successful in allowing the Bush tax cuts to expire the capital gains tax rate will increase from 15 to 20 percent January 1. Also in the Obama Care bill was a new tax on rental income. So I have been pushed by taxes in to trying to sell my rental property by the end of the year.
Changes in taxes change the behavior of people in the real world. The Left has a bad habit of not taking this in to consideration when they contemplate their tax and spend schemes.
More loopholes.
bump
We succeeded in spite of the high taxes.
Also in the 50’s we had won WWI, WWI, Korea, and had no debt. The last balanced budget was signed by Johnson in 1965.
We had put men on the moon and, government was 1/3 the size and scope it is today. BUT, what did not exist in 1965 that has cost the huge increase in government.
The top two would be:
Welfare there was no free housing, food, medical, education, virtually nothing came from Federal government.
Kennedy’s immigration bill opening the country to vastly poor uneducated masses and living off the state.
The marginal rate was higher but it affected far fewer people. That’s because it started at something like $300,000 which is the equivalent of like $3 million today. So it only affected the truly rich. And they knew how to move their money around to avoid it anyway.
Ask the liberals you’re arguing with whether they’d be okay with having the highest bracket start at $3 million.
There were more tax brackets and many more things were deductable...like credit card interest.
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.