6 ms·

Our national debt is directly related to the 45 years of regressive tax policy.

mc32 2y ago
What was the national debt to GDP ratio before income taxes were instituted? It wasn't even 10% between 1890 and 1910 --that's without the income tax.
- ambicapter 2y ago
  Are you saying income taxes lead to an increase in the national debt?
  - mc32 2y ago
    You know how people borrow on future income?
    - Aloisius 2y ago
      We were doing that before income taxes. Hell, we were borrowing before we had states.
- miltonlost 2y ago
  And life SUCKED then. Absolutely no labor rights, food filled with sawdust, income inequality, bank runs constantly, no retirement. The national debt increased because we increased the amount of the federal government does, it the income tax.
  - greatpatton 2y ago
    No healthcare, no public research to today's extent, no military etc. etc. Yes when your government is doing nothing normally it doesn't cost that much.
    - tanseydavid 2y ago
      When was there no military? When was the US government literally doing nothing?
  - wyager 2y ago
    > And life SUCKED then More than 100% of the net improvement is from tech and medical R&D, not the bloated military-welfare apparatus.
    - kristjansson 2y ago
      What created the conditions for that R&D to take place in relative security, and to be realize its return in a global marketplace?
    - jepj57 2y ago
      And Silicon Valley was originally majority weapons/ tech r&d for the military. Bletchly Park? Military.
concordDance 2y ago
Have you done the maths to check if that would have fixed things?
- ChicagoDave 2y ago
  No but it's not rocket science. In 1960 the top tax rate was 91%. In 1980 it was 70%. Reagan dropped it to 35% and it's stayed below 40% since. Then add in that corporations and the wealthy have moved away from having normal income that isn't taxed (loans backed by assets) and you've lost half the tax revenue that paid for cheap housing, nearly free healthcare and public college and you have a healthy society and middle class. But then to screw the pooch even more, Bush printed 5 trillion for his wars and two tax cuts. Trump printed money for his tax cuts too. (these expenses were never in the annual budget - they just printed the money) Tesla, one of the richest corporations in our country just reported 0% tax in three years. Our national debt has nothing to do with the annual budget and expenses, including USAID and helping Ukraine. It is 100% because of tax policy.
  - Acrobatic_Road 2y ago
    While tax cuts do contribute to the national debt, it is not accurate to say the national debt is "100% of tax policy". Tax revenue as a % of GDP has been pretty stable for a long time. https://fred.stlouisfed.org/series/FYFRGDA188S https://fred.stlouisfed.org/series/FYFRGDA188S So what actually is driving the national debt higher? The never popular answer is entitlement spending (Social Security, Medicare, Medicaid) + interest, which is exasperated by an aging population. In fact, almost all future debt growth is driven by these programs. The rest of the budget is expected to balance out. Tax revenue is expected to increase, and discretionary spending is expected to fall as a % of GDP.
    - ChicagoDave 2y ago
      GDP is 27 trillion. The government "borrowed" from the SS fund. That's why it's endangered. The money was there and it should still be there. The government also screwed the postal service by taking their profits (one of the few things in government that actually makes one) and then yells at them for not making enough income. We need a flat corporate and billionaire tax that has no loopholes.
cherrycherry98 2y ago
The percentage of federal taxes paid by income looks like this: Top 1%: 40.4% Top 5%: 61% Top 10%: 72% Top 25%: 87.2% Top 50%: 97% Bottom 50%: 3% That hardly looks regressive. Is there some other standard by which you are judging whether tax policy is sufficiently graduated enough? https://taxfoundation.org/data/all/federal/latest-federal-income-tax-data-2025/ https://taxfoundation.org/data/all/federal/latest-federal-in...
- altcognito 2y ago
  Now change it to comparing disposable income.
- mitthrowaway2 2y ago
  Not the GP, but yes there is: The wealthiest people don't earn their wealth in the form of income. https://www.forbes.com/sites/sarahhansen/2021/06/08/richest-americans-including-bezos-musk-and-buffett-paid-federal-income-taxes-equaling-just-34-of-401-billion-in-new-wealth-bombshell-report-shows/ https://www.forbes.com/sites/sarahhansen/2021/06/08/richest-... the 25 richest Americans (by Forbes’ tally) paid a “true tax rate” of just 3.4% on wealth growth of $401 billion between 2014 and 2018.
  - refurb 2y ago
    Why would pay taxes on paper wealth? That argument is disingenuous but no doubt the author intended it to be.
    - thefreeman 2y ago
      because they can take loans against their paper wealth and spend that as income. and as a bonus they get to write any interest payments off of their taxes.
      - refurb 2y ago
        This isn’t true and is a nice internet trope. Never mind that “wealth” can evaporate as quickly as it’s created, the numbers don’t make sense at for “borrow until you die”. If you think it does I challenge you to do it. Instead of selling taxable equities during retirement, just borrow against them then let your heirs get them tax free when you die. You can insanely cheap margin loans against your holdings if you keep the ratios high. Like 1-2%. Sure it won’t add up to much but you can do it. Then kept rolling it over for 20+ years and tell me how 1-2% interest is less than a 25% capital gains tax. Maybe if you’re going to die within a few years (and can time your death). Then explain why if it works so well why Musk paid $10B in taxes when he sold Tesla stock if it works so well.

mc32 2y ago

What was the national debt to GDP ratio before income taxes were instituted? It wasn't even 10% between 1890 and 1910 --that's without the income tax.

ambicapter 2y ago
Are you saying income taxes lead to an increase in the national debt?
- mc32 2y ago
  You know how people borrow on future income?
  - Aloisius 2y ago
    We were doing that before income taxes. Hell, we were borrowing before we had states.
miltonlost 2y ago
And life SUCKED then. Absolutely no labor rights, food filled with sawdust, income inequality, bank runs constantly, no retirement. The national debt increased because we increased the amount of the federal government does, it the income tax.
- greatpatton 2y ago
  No healthcare, no public research to today's extent, no military etc. etc. Yes when your government is doing nothing normally it doesn't cost that much.
  - tanseydavid 2y ago
    When was there no military? When was the US government literally doing nothing?
- wyager 2y ago
  > And life SUCKED then More than 100% of the net improvement is from tech and medical R&D, not the bloated military-welfare apparatus.
  - kristjansson 2y ago
    What created the conditions for that R&D to take place in relative security, and to be realize its return in a global marketplace?
  - jepj57 2y ago
    And Silicon Valley was originally majority weapons/ tech r&d for the military. Bletchly Park? Military.

concordDance 2y ago

Have you done the maths to check if that would have fixed things?

ChicagoDave 2y ago
No but it's not rocket science. In 1960 the top tax rate was 91%. In 1980 it was 70%. Reagan dropped it to 35% and it's stayed below 40% since. Then add in that corporations and the wealthy have moved away from having normal income that isn't taxed (loans backed by assets) and you've lost half the tax revenue that paid for cheap housing, nearly free healthcare and public college and you have a healthy society and middle class. But then to screw the pooch even more, Bush printed 5 trillion for his wars and two tax cuts. Trump printed money for his tax cuts too. (these expenses were never in the annual budget - they just printed the money) Tesla, one of the richest corporations in our country just reported 0% tax in three years. Our national debt has nothing to do with the annual budget and expenses, including USAID and helping Ukraine. It is 100% because of tax policy.
- Acrobatic_Road 2y ago
  While tax cuts do contribute to the national debt, it is not accurate to say the national debt is "100% of tax policy". Tax revenue as a % of GDP has been pretty stable for a long time. https://fred.stlouisfed.org/series/FYFRGDA188S https://fred.stlouisfed.org/series/FYFRGDA188S So what actually is driving the national debt higher? The never popular answer is entitlement spending (Social Security, Medicare, Medicaid) + interest, which is exasperated by an aging population. In fact, almost all future debt growth is driven by these programs. The rest of the budget is expected to balance out. Tax revenue is expected to increase, and discretionary spending is expected to fall as a % of GDP.
  - ChicagoDave 2y ago
    GDP is 27 trillion. The government "borrowed" from the SS fund. That's why it's endangered. The money was there and it should still be there. The government also screwed the postal service by taking their profits (one of the few things in government that actually makes one) and then yells at them for not making enough income. We need a flat corporate and billionaire tax that has no loopholes.

cherrycherry98 2y ago

The percentage of federal taxes paid by income looks like this: Top 1%: 40.4% Top 5%: 61% Top 10%: 72% Top 25%: 87.2% Top 50%: 97% Bottom 50%: 3% That hardly looks regressive. Is there some other standard by which you are judging whether tax policy is sufficiently graduated enough? https://taxfoundation.org/data/all/federal/latest-federal-income-tax-data-2025/ https://taxfoundation.org/data/all/federal/latest-federal-in...

altcognito 2y ago
Now change it to comparing disposable income.
mitthrowaway2 2y ago
Not the GP, but yes there is: The wealthiest people don't earn their wealth in the form of income. https://www.forbes.com/sites/sarahhansen/2021/06/08/richest-americans-including-bezos-musk-and-buffett-paid-federal-income-taxes-equaling-just-34-of-401-billion-in-new-wealth-bombshell-report-shows/ https://www.forbes.com/sites/sarahhansen/2021/06/08/richest-... the 25 richest Americans (by Forbes’ tally) paid a “true tax rate” of just 3.4% on wealth growth of $401 billion between 2014 and 2018.
- refurb 2y ago
  Why would pay taxes on paper wealth? That argument is disingenuous but no doubt the author intended it to be.
  - thefreeman 2y ago
    because they can take loans against their paper wealth and spend that as income. and as a bonus they get to write any interest payments off of their taxes.
    - refurb 2y ago
      This isn’t true and is a nice internet trope. Never mind that “wealth” can evaporate as quickly as it’s created, the numbers don’t make sense at for “borrow until you die”. If you think it does I challenge you to do it. Instead of selling taxable equities during retirement, just borrow against them then let your heirs get them tax free when you die. You can insanely cheap margin loans against your holdings if you keep the ratios high. Like 1-2%. Sure it won’t add up to much but you can do it. Then kept rolling it over for 20+ years and tell me how 1-2% interest is less than a 25% capital gains tax. Maybe if you’re going to die within a few years (and can time your death). Then explain why if it works so well why Musk paid $10B in taxes when he sold Tesla stock if it works so well.