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A majority of Americans support raising the top tax rate to 70 percent

46 points by laurex 8y ago

dudul 8y ago
I don't really follow this conversation, but just by eye-balling Twitter it's astonishing how many people do not understand how marginal tax rates work.
- shereadsthenews 8y ago
  It’s also amazing how many people on Twitter clearly do not remember the 90s where we raised the top marginal rate and experienced an unprecedented run of economic expansion.
  - jamesj1980 8y ago
    I remember the 90's. I think it takes a revisionist to say raising the top marginal rate was what caused the economic boom. I would guess the big drivers were low oil prices and that dot com thing.
    - tivert 8y ago
      > I remember the 90's. I think it takes a revisionist to say raising the top marginal rate was what caused the economic boom. I would guess the big drivers were low oil prices and that dot com thing. But it doesn't take a revisionist to see that shows that raising the top marginal rate won't doom the economy, like many incorrectly claim.
      - jamesj1980 8y ago
        No, it takes a person given to speculation. I think it's disingenuous to use the dot com era as your example because of the shear magnitude of value that was being created during that time period.
  - thatoneuser 8y ago
    The 90s had a lot of factors that led to economic expansion. Do you have data/research that explicitly links tax rates to that expansion? The numbers don't seem to add up like that to me.
    - bryanlarsen 8y ago
      The OP didn't say the expansion was caused by the increase in marginal tax rates. The coincidence does falsify the argument that raising tax rates would prevent economic expansion.
      - thatoneuser 8y ago
        It doesn't falsify that at all.
- ceejayoz 8y ago
  Particularly egregious is Congressmen (https://twitter.com/SteveScalise/status/1081579535114608640 https://twitter.com/SteveScalise/status/1081579535114608640) and Governors (https://twitter.com/ScottWalker/status/1085199713463422981 https://twitter.com/ScottWalker/status/1085199713463422981) pretending they've never heard of the concept.
  - smacktoward 8y ago
    Both Scalise and Walker are Republicans, of course. It's almost like they have an ideological reason to sow confusion on this subject!
jtlienwis 8y ago
If you frame it as a simple question, then sure almost everyone would say tax someone else at a high rate and they will assume they will pay less tax. But, if you go by how it actually will work out in the real world... Ask if you support a 70% tax on the highest incomes, if it results in less tax being collected on high incomes and MORE being paid by the lowest incomes, then it probably would not get such a high percentage. Need to lower the tax rate for higher earners, so that everyone works harder, pays more tax and yet gets themselves into a LOWER bracket. If you want to tax something, tax luxury goods and contributions to political candidates.
- r_smart 8y ago
  Imagine how much the conversation would shift if we instead focused on increasing tax revenue, rather than increasing tax rates.
  - rbritton 8y ago
    An alternate shift could be to focus on decreasing expenses. There is A LOT of bloat in the US budget, but it's rarely ever even referenced because so much of it is political poison to some subset of constituents.
    - r_smart 8y ago
      I completely agree. I was just trying to avoid getting up on a soapbox :)
  - jandrese 8y ago
    Or decreasing the deficit? Last time we managed to balance the budget was under Bill Clinton.
    - r_smart 8y ago
      I completely agree. And as far as I know, the Clinton balanced budget was kind of a red herring. I'm sorry I can't remember where I had run into that. Doesn't change your point, and at least it was something they considered useful as a political goal. Unlike now.
mamon 8y ago
Even if this became the law no one with more than a half of brain would ever pay 70% tax. People earning north of $10M usually have a team of tax advisors, and a lot of options of avoiding income tax: offshore companies, charity foundations, etc. The discussion about this is just a distraction from more pressing matters.
- mizchief2 8y ago
  That's the problem. They talk about raising tax on billionaires, but when the number come out they hit people making $300k a year, good money no doubt, but these are your doctors, small business owners, etc. that are still paying income taxes.
- DFHippie 8y ago
  No one would ever pay 70% tax, even without the accountants and advisors, because 70% would be the top marginal rate. Their first $10M would be taxed at a lower rate.
- shereadsthenews 8y ago
  If any of that is true why did they bother lowering the rates last year?
  - tracker1 8y ago
    For most families (who earn under $200k/year or so), the extra return and/or reduction in taxes actually spur spending, which drives growth. The top earners spend less, meaning less whole-economy growth. Personally, I don't think it's right to have more than 50% tax rate at any level, and beyond say $50k/year would say that a 20-30% tax all the way up without deductions would be better. Eliminate corporate taxes, limit corporate capital holdings requiring either reinvestment or divestment to shareholders (who are then taxed). Simplifying and automating the system better would work better for everyone involved. But confusion keeps Intuit/H&R Block and others in business.
  - jandrese 8y ago
    Because Donald Trump and his friends want to pay less in taxes and don't seem to care much about the health of the government or its citizens?
porpoisely 8y ago
This isn't going to do much but hurt professionals like doctors, lawyers, software developers, traders, small business, etc who work for income. The truly wealthy people do not gain their wealth through income. They get it through capital gains ( stocks, homes, asset value increases ). Capital gains ( long term ) are taxed at 20%.
- dudul 8y ago
  Wait, software developers make $10 millions a year?
  - porpoisely 8y ago
    No. The current top bracket is a few hundred thousand. https://www.bankrate.com/finance/taxes/tax-brackets.aspx https://www.bankrate.com/finance/taxes/tax-brackets.aspx Edit: To the people downvoting, I'm well aware that the current bracket won't be taxed at 70%. But there is a lot of room between $500K and $10 million. And I have feeling that there will be many brackets between the current top bracket and the new one.
    - ceejayoz 8y ago
      The polling is not about raising the current highest tax bracket to 70%, it's about adding a new one. From the article: > The New York Democrat kicked off a debate within her party in a Jan. 6 interview with "60 Minutes" during which she said she would support setting the highest tax, which she said would kick in at individuals 10 millionth dollar of income, at 70 percent.
    - stouset 8y ago
      Nobody I’m aware of is suggesting we tax the current top bracket at 70%, but that we make a new top bracket.
      - jedmeyers 8y ago
        There is already a thing called AMT so a new top bracket makes zero sense.
drewg123 8y ago
This would never pass due to Grover Norquist & Americans for Tax Reform's strangle-hold on the Republican party. They have a "Taxpayer Protection Pledge" they leverage Rep. candidates into signing. When they are elected, if they ever vote for anything that could be viewed as a tax increase, ATR campaigns heavily against them in the next election.
- r00fus 8y ago
  This tactic may work in the 90s and 00s era where crowdsourced campaign funding and modern online organizing didn’t yet exist. Nowadays people can pressure their friends and family to vote and dilute lobbying pressure. How impactful was the Norquist crowd in 2018?
  - devonkim 8y ago
    A lot of the GOP seats that were held in this past cycle were in very, very strongly held districts. Those are the politicians that are most worried about upsetting the Norquist based SIG. Furthermore, as long as the Senate is still majority GOP it really doesn’t terribly matter to the GOP even if it was 80%+ Democrat in the house. They should be generally comfortable that the judicial branch is now solidly in their favor for decades even if they lose an entire branch now. You can talk about policies all you want but the GOP are substantially better politicians than the DNC could ever hope to be.
  - drewg123 8y ago
    You might be right. Looking at opensecrets.org, it looks like their activity has really dropped off in the last decade. It would nice to finally be free of them.
  - samdunham 8y ago
    As long as our votes are secret, you can't "pressure" anyone to vote any way about anything.
LinuxBender 8y ago
It appears I am in the minority. I do not support raising taxes on anyone. I support cutting spending and removing most government programs. Raising taxes has always had the impact of removing disposable income which impacts businesses and eventually impacts the individual. [1] I would rather see all government expenses become fully transparent, in addition to showing all money spent on lobbying down to the cent. Every government project should have public documents that detail a full project break-down and what money what spent specifically on what. [1] - https://www.infoplease.com/homework-help/social-studies/fiscal-policy-and-economic-growth-governments-unique-situation https://www.infoplease.com/homework-help/social-studies/fisc...
- jjtheblunt 8y ago
  You're not at all in the minority: the (interesting) US president was elected in large part because enough people were sick of ever-expanding federal government that they got to the polls and voted.
  - millstone 8y ago
    What a strange take. The 2016 campaign had absolutely nothing to do with the size of the government. Trump's campaign promises included $550 billion federal investment in infrastructure, deporting all illegal immigrants, and providing health insurance for everybody, paid for by the government.
  - davidcbc 8y ago
    Even if this was the reason everyone voted for Trump (a dubious claim at best), that still wouldn't make it the majority opinion because the majority of voters didn't vote for him.
- dudul 8y ago
  Doing one doesn't prevent from doing the other. I'm also in the minority but my view on this has changed a lot in the past few years. I don't understand why there isn't a "maximum income" regulation actually. If you make $20M/year, do you really need more?
deleted 8y ago
[deleted]
kodablah 8y ago
> Currently the top tax rate is 37%. Would you favor or oppose a tax proposal that would apply a 70% rate to the 10 millionth dollar and beyond for individuals making $10 million a year or more in reportable income? This simple yes/no question doesn't allow an accurate response. How about splitting it: Would you favor/oppose the rate hike if other tax rates were reduced? Would you favor/oppose the rate hike even if other tax rates weren't reduced? Or, to put it another way, would you favor giving the federal government more money via more taxing on the rich without any reduction in other taxes? The difference in the answers will often tell you what side of the financial political line people fall on and their confidence in government. Of course, even this is too general of a question.
aag2113 8y ago
For anyone else who may be wondering, the Washington Post estimates that this would affect ~16,000 households and generate (on the high end) $72 billion annually in additional tax revenue. https://www.washingtonpost.com/business/2019/01/05/ocasio-cortez-wants-higher-taxes-very-rich-americans-heres-how-much-money-could-that-raise/?noredirect=on&utm_term=.23b0363836a7 https://www.washingtonpost.com/business/2019/01/05/ocasio-co...
- thatoneuser 8y ago
  Doesn't seem like much of an impact then.
  - ceejayoz 8y ago
    The government is currently shut down over a $5B disagreement, so I'd say $72B isn't something to scoff at.
    - Jach 8y ago
      The disagreement would likely persist even if it was $5M. I haven't heard anyone object to the issue because of its price. The US government spent $4T last year. So yeah, an extra $72B does seem like a drop in the bucket.
      - ceejayoz 8y ago
        7-8% of our budget deficit is not a small number. $72B would let you triple the NIH's budget, quintuple NASA's...
        Jach 8y ago
        Looked at from the deficit, I suppose. Though I'm not persuaded by arguments based on what extra funds could do; there's a lot we could do by just rearranging the already ginormous amount the government collects. It's not going to happen, though.
        8y ago
siffland 8y ago
I find the poll kind of funny. Of course it is going to be in favor of taxing people who make more that $10 million. Odds are if you polled for 70% tax rate for people over $1 million it would swing the same way. Why?Because it does not (directly) affect most of us as most dont make that much money. So it is easier to let the people above us do the heavy lifting. The estimates i have read online say that it should raise like $70 to $100 billion a year. However does anyone here really believe someone making $40 or $50 million a year are not going to find tax shelters for their income and are going to stand paying 70 cents on the dollar in taxes. Also when the article states they make more they should give more. What about a lottery ticket winner. Like the one who won $1.6 billion, so like $1.1 billion of that would be paid in tax. That is a great scheme for the governement. I just dont think it will generate the money people think it will and will incite more class warfare.
- Jach 8y ago
  > However does anyone here really believe someone making $40 or $50 million a year are not going to find tax shelters for their income and are going to stand paying 70 cents on the dollar in taxes. You'd think so given how frequently the "it was once 91%!" phrase comes up. Regardless of tax rates, the amount of GDP gathered from taxation revenue has been pretty stable: https://en.wikipedia.org/wiki/Hauser%27s_law https://en.wikipedia.org/wiki/Hauser%27s_law
methodiosmel 8y ago
Apparently a majority of Americans think they entitled to rich people's money... Like thieves.

46 points by laurex 8y ago

I don't really follow this conversation, but just by eye-balling Twitter it's astonishing how many people do not understand how marginal tax rates work.

shereadsthenews 8y ago
It’s also amazing how many people on Twitter clearly do not remember the 90s where we raised the top marginal rate and experienced an unprecedented run of economic expansion.
- jamesj1980 8y ago
  I remember the 90's. I think it takes a revisionist to say raising the top marginal rate was what caused the economic boom. I would guess the big drivers were low oil prices and that dot com thing.
  - tivert 8y ago
    > I remember the 90's. I think it takes a revisionist to say raising the top marginal rate was what caused the economic boom. I would guess the big drivers were low oil prices and that dot com thing. But it doesn't take a revisionist to see that shows that raising the top marginal rate won't doom the economy, like many incorrectly claim.
    - jamesj1980 8y ago
      No, it takes a person given to speculation. I think it's disingenuous to use the dot com era as your example because of the shear magnitude of value that was being created during that time period.
- thatoneuser 8y ago
  The 90s had a lot of factors that led to economic expansion. Do you have data/research that explicitly links tax rates to that expansion? The numbers don't seem to add up like that to me.
  - bryanlarsen 8y ago
    The OP didn't say the expansion was caused by the increase in marginal tax rates. The coincidence does falsify the argument that raising tax rates would prevent economic expansion.
    - thatoneuser 8y ago
      It doesn't falsify that at all.
ceejayoz 8y ago
Particularly egregious is Congressmen (https://twitter.com/SteveScalise/status/1081579535114608640 https://twitter.com/SteveScalise/status/1081579535114608640) and Governors (https://twitter.com/ScottWalker/status/1085199713463422981 https://twitter.com/ScottWalker/status/1085199713463422981) pretending they've never heard of the concept.
- smacktoward 8y ago
  Both Scalise and Walker are Republicans, of course. It's almost like they have an ideological reason to sow confusion on this subject!

jtlienwis 8y ago

If you frame it as a simple question, then sure almost everyone would say tax someone else at a high rate and they will assume they will pay less tax. But, if you go by how it actually will work out in the real world... Ask if you support a 70% tax on the highest incomes, if it results in less tax being collected on high incomes and MORE being paid by the lowest incomes, then it probably would not get such a high percentage. Need to lower the tax rate for higher earners, so that everyone works harder, pays more tax and yet gets themselves into a LOWER bracket. If you want to tax something, tax luxury goods and contributions to political candidates.

r_smart 8y ago
Imagine how much the conversation would shift if we instead focused on increasing tax revenue, rather than increasing tax rates.
- rbritton 8y ago
  An alternate shift could be to focus on decreasing expenses. There is A LOT of bloat in the US budget, but it's rarely ever even referenced because so much of it is political poison to some subset of constituents.
  - r_smart 8y ago
    I completely agree. I was just trying to avoid getting up on a soapbox :)
- jandrese 8y ago
  Or decreasing the deficit? Last time we managed to balance the budget was under Bill Clinton.
  - r_smart 8y ago
    I completely agree. And as far as I know, the Clinton balanced budget was kind of a red herring. I'm sorry I can't remember where I had run into that. Doesn't change your point, and at least it was something they considered useful as a political goal. Unlike now.

mamon 8y ago

Even if this became the law no one with more than a half of brain would ever pay 70% tax. People earning north of $10M usually have a team of tax advisors, and a lot of options of avoiding income tax: offshore companies, charity foundations, etc. The discussion about this is just a distraction from more pressing matters.

mizchief2 8y ago
That's the problem. They talk about raising tax on billionaires, but when the number come out they hit people making $300k a year, good money no doubt, but these are your doctors, small business owners, etc. that are still paying income taxes.
DFHippie 8y ago
No one would ever pay 70% tax, even without the accountants and advisors, because 70% would be the top marginal rate. Their first $10M would be taxed at a lower rate.
shereadsthenews 8y ago
If any of that is true why did they bother lowering the rates last year?
- tracker1 8y ago
  For most families (who earn under $200k/year or so), the extra return and/or reduction in taxes actually spur spending, which drives growth. The top earners spend less, meaning less whole-economy growth. Personally, I don't think it's right to have more than 50% tax rate at any level, and beyond say $50k/year would say that a 20-30% tax all the way up without deductions would be better. Eliminate corporate taxes, limit corporate capital holdings requiring either reinvestment or divestment to shareholders (who are then taxed). Simplifying and automating the system better would work better for everyone involved. But confusion keeps Intuit/H&R Block and others in business.
- jandrese 8y ago
  Because Donald Trump and his friends want to pay less in taxes and don't seem to care much about the health of the government or its citizens?

porpoisely 8y ago

This isn't going to do much but hurt professionals like doctors, lawyers, software developers, traders, small business, etc who work for income. The truly wealthy people do not gain their wealth through income. They get it through capital gains ( stocks, homes, asset value increases ). Capital gains ( long term ) are taxed at 20%.

dudul 8y ago
Wait, software developers make $10 millions a year?
- porpoisely 8y ago
  No. The current top bracket is a few hundred thousand. https://www.bankrate.com/finance/taxes/tax-brackets.aspx https://www.bankrate.com/finance/taxes/tax-brackets.aspx Edit: To the people downvoting, I'm well aware that the current bracket won't be taxed at 70%. But there is a lot of room between $500K and $10 million. And I have feeling that there will be many brackets between the current top bracket and the new one.
  - ceejayoz 8y ago
    The polling is not about raising the current highest tax bracket to 70%, it's about adding a new one. From the article: > The New York Democrat kicked off a debate within her party in a Jan. 6 interview with "60 Minutes" during which she said she would support setting the highest tax, which she said would kick in at individuals 10 millionth dollar of income, at 70 percent.
  - stouset 8y ago
    Nobody I’m aware of is suggesting we tax the current top bracket at 70%, but that we make a new top bracket.
    - jedmeyers 8y ago
      There is already a thing called AMT so a new top bracket makes zero sense.

drewg123 8y ago

This would never pass due to Grover Norquist & Americans for Tax Reform's strangle-hold on the Republican party. They have a "Taxpayer Protection Pledge" they leverage Rep. candidates into signing. When they are elected, if they ever vote for anything that could be viewed as a tax increase, ATR campaigns heavily against them in the next election.

r00fus 8y ago
This tactic may work in the 90s and 00s era where crowdsourced campaign funding and modern online organizing didn’t yet exist. Nowadays people can pressure their friends and family to vote and dilute lobbying pressure. How impactful was the Norquist crowd in 2018?
- devonkim 8y ago
  A lot of the GOP seats that were held in this past cycle were in very, very strongly held districts. Those are the politicians that are most worried about upsetting the Norquist based SIG. Furthermore, as long as the Senate is still majority GOP it really doesn’t terribly matter to the GOP even if it was 80%+ Democrat in the house. They should be generally comfortable that the judicial branch is now solidly in their favor for decades even if they lose an entire branch now. You can talk about policies all you want but the GOP are substantially better politicians than the DNC could ever hope to be.
- drewg123 8y ago
  You might be right. Looking at opensecrets.org, it looks like their activity has really dropped off in the last decade. It would nice to finally be free of them.
- samdunham 8y ago
  As long as our votes are secret, you can't "pressure" anyone to vote any way about anything.

LinuxBender 8y ago

It appears I am in the minority. I do not support raising taxes on anyone. I support cutting spending and removing most government programs. Raising taxes has always had the impact of removing disposable income which impacts businesses and eventually impacts the individual. [1] I would rather see all government expenses become fully transparent, in addition to showing all money spent on lobbying down to the cent. Every government project should have public documents that detail a full project break-down and what money what spent specifically on what. [1] - https://www.infoplease.com/homework-help/social-studies/fiscal-policy-and-economic-growth-governments-unique-situation https://www.infoplease.com/homework-help/social-studies/fisc...

jjtheblunt 8y ago
You're not at all in the minority: the (interesting) US president was elected in large part because enough people were sick of ever-expanding federal government that they got to the polls and voted.
- millstone 8y ago
  What a strange take. The 2016 campaign had absolutely nothing to do with the size of the government. Trump's campaign promises included $550 billion federal investment in infrastructure, deporting all illegal immigrants, and providing health insurance for everybody, paid for by the government.
- davidcbc 8y ago
  Even if this was the reason everyone voted for Trump (a dubious claim at best), that still wouldn't make it the majority opinion because the majority of voters didn't vote for him.
dudul 8y ago
Doing one doesn't prevent from doing the other. I'm also in the minority but my view on this has changed a lot in the past few years. I don't understand why there isn't a "maximum income" regulation actually. If you make $20M/year, do you really need more?

deleted 8y ago

[deleted]

kodablah 8y ago

> Currently the top tax rate is 37%. Would you favor or oppose a tax proposal that would apply a 70% rate to the 10 millionth dollar and beyond for individuals making $10 million a year or more in reportable income? This simple yes/no question doesn't allow an accurate response. How about splitting it: Would you favor/oppose the rate hike if other tax rates were reduced? Would you favor/oppose the rate hike even if other tax rates weren't reduced? Or, to put it another way, would you favor giving the federal government more money via more taxing on the rich without any reduction in other taxes? The difference in the answers will often tell you what side of the financial political line people fall on and their confidence in government. Of course, even this is too general of a question.

aag2113 8y ago

For anyone else who may be wondering, the Washington Post estimates that this would affect ~16,000 households and generate (on the high end) $72 billion annually in additional tax revenue. https://www.washingtonpost.com/business/2019/01/05/ocasio-cortez-wants-higher-taxes-very-rich-americans-heres-how-much-money-could-that-raise/?noredirect=on&utm_term=.23b0363836a7 https://www.washingtonpost.com/business/2019/01/05/ocasio-co...

thatoneuser 8y ago
Doesn't seem like much of an impact then.
- ceejayoz 8y ago
  The government is currently shut down over a $5B disagreement, so I'd say $72B isn't something to scoff at.
  - Jach 8y ago
    The disagreement would likely persist even if it was $5M. I haven't heard anyone object to the issue because of its price. The US government spent $4T last year. So yeah, an extra $72B does seem like a drop in the bucket.
    - ceejayoz 8y ago
      7-8% of our budget deficit is not a small number. $72B would let you triple the NIH's budget, quintuple NASA's...
      - Jach 8y ago
        Looked at from the deficit, I suppose. Though I'm not persuaded by arguments based on what extra funds could do; there's a lot we could do by just rearranging the already ginormous amount the government collects. It's not going to happen, though.
      - 8y ago

siffland 8y ago

I find the poll kind of funny. Of course it is going to be in favor of taxing people who make more that $10 million. Odds are if you polled for 70% tax rate for people over $1 million it would swing the same way. Why?Because it does not (directly) affect most of us as most dont make that much money. So it is easier to let the people above us do the heavy lifting. The estimates i have read online say that it should raise like $70 to $100 billion a year. However does anyone here really believe someone making $40 or $50 million a year are not going to find tax shelters for their income and are going to stand paying 70 cents on the dollar in taxes. Also when the article states they make more they should give more. What about a lottery ticket winner. Like the one who won $1.6 billion, so like $1.1 billion of that would be paid in tax. That is a great scheme for the governement. I just dont think it will generate the money people think it will and will incite more class warfare.

Jach 8y ago
> However does anyone here really believe someone making $40 or $50 million a year are not going to find tax shelters for their income and are going to stand paying 70 cents on the dollar in taxes. You'd think so given how frequently the "it was once 91%!" phrase comes up. Regardless of tax rates, the amount of GDP gathered from taxation revenue has been pretty stable: https://en.wikipedia.org/wiki/Hauser%27s_law https://en.wikipedia.org/wiki/Hauser%27s_law

methodiosmel 8y ago

Apparently a majority of Americans think they entitled to rich people's money... Like thieves.