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It's interesting how everyone wants to go back to the 50's america with functioning infrastructure and all that, but no one wants to pay the 90% tax that lead u

It's interesting how everyone wants to go back to the 50's america with functioning infrastructure and all that, but no one wants to pay the 90% tax that lead up to that. Also consider that payroll tax has become an increasing portion of what is collected, health insurance is now required to be paid by the individual regardless of health status, and auto insurance is now required for all drivers. These are effectively regressive taxes on the general population. https://en.wikipedia.org/wiki/History_of_taxation_in_the_United_States#Income_tax https://en.wikipedia.org/wiki/History_of_taxation_in_the_Uni...

s1artibartfast 2y ago
>It's interesting how everyone wants to go back to the 50's america with functioning infrastructure and all that, but no one wants to pay the 90% tax that lead up to that combined State+ federal taxes look to be on par with 1950s levels. It also ignores the fact that the inflation controlled GDP has gone up 4.5X since then too. The government is rolling in 4X the cash as the 50's, but cant build a fraction of the infrastructure. >Also consider that payroll tax has become an increasing portion of what is collected, health insurance is now required to be paid by the individual regardless of health status, and auto insurance is now required for all drivers. These are effectively regressive taxes on the general population. Payroll, health, and auto insurance aren't regressive taxes, they are flat taxes and slightly progressive taxes. High earners still subsidize low earners for SSI. auto and health are flat.
- thatcat 2y ago
  Net GDP normalized graph looks the same right? However, my point was that the origin of the income has shifted significantly. Parent says 45% progressive tax is high, it's not - it's half as progressive as it was in the 50s before including other societal changes that effectively serve as a regressive tax.
  - s1artibartfast 2y ago
    >Net GDP normalized graph looks the same right? My first point is to question if %GDP is the right framework to even think about this, rather than dollars. >However, my point was that the origin of the income has shifted significantly. I dont think it has. Income taxes seem to be within a percent or so of 1950 values, but payroll taxes have increased massively. This means income tax revenue is pretty similar as a % of GDP, and massively increased in real dollars. >Parent says 45% progressive tax is high, it's not - it's half as progressive as it was in the 50s before including other societal changes that effectively serve as a regressive tax. Thats not evident from the data. You would have to look at actual breakdown of federal revenues from income group, not just the tax brackets. It could be that taxes were far more flat/regressive in the 1950s (e.g. to 1,10% paid a much smaller share. Table 5 of this link goes back to the 80s, and shows the fraction paid by the top 10% earners increase from 32% to 52% in the last 40 years. That is a huge progressive taxation swing. https://taxfoundation.org/data/all/federal/latest-federal-income-tax-data-2024/#:~:text=The%20share%20of%20income%20taxes,policy%20during%20the%20coronavirus%20pandemic https://taxfoundation.org/data/all/federal/latest-federal-in...
    - thatcat 2y ago
      Maybe gdp is not the best normalizing variable to choose, any suggestions on something better? In the context of the previous 25 years its not. "following World War II tax increases, top marginal individual tax rates stayed near or above 90%, and the effective tax rate at 70% for the highest incomes (few paid the top rate), until 1964 when the top marginal tax rate was lowered to 70%..."- wikipedia it would be interesting to have the full historical data set to play with
      - s1artibartfast 2y ago
        Yes it would. The wiki quote is misleading in that it only talks about rates, not what is actually paid, shelters, exemptions, ect.

s1artibartfast 2y ago

>It's interesting how everyone wants to go back to the 50's america with functioning infrastructure and all that, but no one wants to pay the 90% tax that lead up to that combined State+ federal taxes look to be on par with 1950s levels. It also ignores the fact that the inflation controlled GDP has gone up 4.5X since then too. The government is rolling in 4X the cash as the 50's, but cant build a fraction of the infrastructure. >Also consider that payroll tax has become an increasing portion of what is collected, health insurance is now required to be paid by the individual regardless of health status, and auto insurance is now required for all drivers. These are effectively regressive taxes on the general population. Payroll, health, and auto insurance aren't regressive taxes, they are flat taxes and slightly progressive taxes. High earners still subsidize low earners for SSI. auto and health are flat.

thatcat 2y ago
Net GDP normalized graph looks the same right? However, my point was that the origin of the income has shifted significantly. Parent says 45% progressive tax is high, it's not - it's half as progressive as it was in the 50s before including other societal changes that effectively serve as a regressive tax.
- s1artibartfast 2y ago
  >Net GDP normalized graph looks the same right? My first point is to question if %GDP is the right framework to even think about this, rather than dollars. >However, my point was that the origin of the income has shifted significantly. I dont think it has. Income taxes seem to be within a percent or so of 1950 values, but payroll taxes have increased massively. This means income tax revenue is pretty similar as a % of GDP, and massively increased in real dollars. >Parent says 45% progressive tax is high, it's not - it's half as progressive as it was in the 50s before including other societal changes that effectively serve as a regressive tax. Thats not evident from the data. You would have to look at actual breakdown of federal revenues from income group, not just the tax brackets. It could be that taxes were far more flat/regressive in the 1950s (e.g. to 1,10% paid a much smaller share. Table 5 of this link goes back to the 80s, and shows the fraction paid by the top 10% earners increase from 32% to 52% in the last 40 years. That is a huge progressive taxation swing. https://taxfoundation.org/data/all/federal/latest-federal-income-tax-data-2024/#:~:text=The%20share%20of%20income%20taxes,policy%20during%20the%20coronavirus%20pandemic https://taxfoundation.org/data/all/federal/latest-federal-in...
  - thatcat 2y ago
    Maybe gdp is not the best normalizing variable to choose, any suggestions on something better? In the context of the previous 25 years its not. "following World War II tax increases, top marginal individual tax rates stayed near or above 90%, and the effective tax rate at 70% for the highest incomes (few paid the top rate), until 1964 when the top marginal tax rate was lowered to 70%..."- wikipedia it would be interesting to have the full historical data set to play with
    - s1artibartfast 2y ago
      Yes it would. The wiki quote is misleading in that it only talks about rates, not what is actually paid, shelters, exemptions, ect.