The comments here undoubtedly set a record for misinformation and revisionist history, much of it triggered by @mrrationalhbg’s misleading,jordan, though sort of factually true,Doudoune Moncler Femme, statement regarding the 70% (actually 69.125%) top marginal tax rate during the first year of Reagan’s first term. While this little bit of misinformation is amusing the pure ideological fantasy expressed in the numerous retorts is downright comical.
@Lagila’s response which relies entirely on a quote from a WSJ piece which looks like the work of the Cato institute,Doudoune Moncler, number twisters extraordinaire. Here’s the quote:
“As the nearby chart shows, however,Moncler, those super-high tax rates at all income levels brought in revenue of only 7.7% of GDP,doudounes moncler, according to U.S. budget historical data.” “President Reagan’s across-the-board tax cuts further reduced the lowest and highest tax rates to 11% and 50%, yet revenues rose again to 8.3% of GDP.”
First problem is the 7.7% of GDP figure. Where did this come from? According to the OMB (rather than the WSJ) federal government revenue from individual income taxes was 9.0% of GDP the year Reagan was elected (when the top marginal rate was 70%) and it was 9.4% of GDP in 1981, Reagan’s first year in office when the rate was 69.125%. And while it’s true that revenue did increase to 8.3% of GDP in 1989,Doudoune Moncler Pas Cher, the year after Reagan left office,air jordan france, this doesn’t present the whole picture. In 1982,Moncler, the year the top rate was reduced from 69.125% to 50%, revenue fell to 9.2% of GDP. In 1983 the top rate held at 50% and revenue again fell to 8.4% and in 1984 with the top rate still at 50% revenue again fell to 7.8%. Revenue peaked at 8.4% of GDP in 1987,nike air jordan, the year the top marginal rate was dropped to 38.5%,Jordan, after which revenue more or less steadily declined to a low of 7.6% of GDP in 1992 when something interesting happened. Clinton was elected in 1992 and immediately increased the top rate to 39.6% from 31% (Bush had raised it to 31% from 28% in 1991) and revenue steadily rose from 7.6% of GDP to 10.3% of GDP in 2000 (the highest it’s ever been) when something even more interesting happened. Of course that was the year G.W. bush was elected and his administration lowered the top rate to 35% over three years and lo and behold revenue fell to just 7.0% of GDP in 2004, the lowest level since 1951. That’s not the best part though, W’s first term was the first administration in the history of the country to collect less revenue in individual income taxes in it’s last year (2004 – $809B) than it did in it’s first (2001 – $994B) and to top it all off that’s not adjusted for inflation. Plain and simple, the myth that lowering tax rates increases revenue is just not supported by the data.
Hollande’s goal in France is to reduce the deficit and eventually pay down the debt. The U.S. national debt peaked at 121% of GDP in 1946 and with top marginal tax rates between 70% and 92% that debt was steadily reduced to a post WWII low of 32% the year Reagan moved in to the Whitehouse. By the time his vice-president left office in 1992 after cutting the top marginal rate in half, that debt had risen to 64% of GDP. It would appear that was not a very successful attempt at lowering the debt to GDP ratio.
The comments here undoubtedly set a record for misinformation and revisionist history, much of it triggered by @mrrationalhbg’s misleading,jordan, though sort of factually true,Doudoune Moncler Femme, statement regarding the 70% (actually 69.125%) top marginal tax rate during the first year of Reagan’s first term. While this little bit of misinformation is amusing the pure ideological fantasy expressed in the numerous retorts is downright comical.
@Lagila’s response which relies entirely on a quote from a WSJ piece which looks like the work of the Cato institute,Doudoune Moncler, number twisters extraordinaire. Here’s the quote:
“As the nearby chart shows, however,Moncler, those super-high tax rates at all income levels brought in revenue of only 7.7% of GDP,doudounes moncler, according to U.S. budget historical data.” “President Reagan’s across-the-board tax cuts further reduced the lowest and highest tax rates to 11% and 50%, yet revenues rose again to 8.3% of GDP.”
First problem is the 7.7% of GDP figure. Where did this come from? According to the OMB (rather than the WSJ) federal government revenue from individual income taxes was 9.0% of GDP the year Reagan was elected (when the top marginal rate was 70%) and it was 9.4% of GDP in 1981, Reagan’s first year in office when the rate was 69.125%. And while it’s true that revenue did increase to 8.3% of GDP in 1989,Doudoune Moncler Pas Cher, the year after Reagan left office,air jordan france, this doesn’t present the whole picture. In 1982,Moncler, the year the top rate was reduced from 69.125% to 50%, revenue fell to 9.2% of GDP. In 1983 the top rate held at 50% and revenue again fell to 8.4% and in 1984 with the top rate still at 50% revenue again fell to 7.8%. Revenue peaked at 8.4% of GDP in 1987,nike air jordan, the year the top marginal rate was dropped to 38.5%,Jordan, after which revenue more or less steadily declined to a low of 7.6% of GDP in 1992 when something interesting happened. Clinton was elected in 1992 and immediately increased the top rate to 39.6% from 31% (Bush had raised it to 31% from 28% in 1991) and revenue steadily rose from 7.6% of GDP to 10.3% of GDP in 2000 (the highest it’s ever been) when something even more interesting happened. Of course that was the year G.W. bush was elected and his administration lowered the top rate to 35% over three years and lo and behold revenue fell to just 7.0% of GDP in 2004, the lowest level since 1951. That’s not the best part though, W’s first term was the first administration in the history of the country to collect less revenue in individual income taxes in it’s last year (2004 – $809B) than it did in it’s first (2001 – $994B) and to top it all off that’s not adjusted for inflation. Plain and simple, the myth that lowering tax rates increases revenue is just not supported by the data.
Hollande’s goal in France is to reduce the deficit and eventually pay down the debt. The U.S. national debt peaked at 121% of GDP in 1946 and with top marginal tax rates between 70% and 92% that debt was steadily reduced to a post WWII low of 32% the year Reagan moved in to the Whitehouse. By the time his vice-president left office in 1992 after cutting the top marginal rate in half, that debt had risen to 64% of GDP. It would appear that was not a very successful attempt at lowering the debt to GDP ratio.