No. of Recommendations: 30
Peter Schiff: The Fantasy of a 91% Top Income Tax Rate

"Higher tax rates on the wealthy, we're told, would help balance the budget, allow for more "investment" in America's future and foster better economic growth for all. In support of this claim, like-minded liberal pundits point out that in the 1950s, when America's economic might was at its zenith, the rich faced tax rates as high as 91%.

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In 1958, an 81% marginal tax rate applied to incomes above $1.08 million, and the 91% rate kicked in at $3.08 million. These figures are in unadjusted 1958 dollars and correspond today to nominal income levels that are at least 10 times higher. That year, according to Internal Revenue Service records, just 236 of the nation's 45.6 million tax filers had any income that was taxed at 81% or higher. (The published IRS data do not reveal how many of these were subject to the 91% rate.)

In 1958, approximately 28,600 filers (0.06% of all taxpayers) earned the $93,168 or more needed to face marginal rates as high as 30%. These Americans—genuinely wealthy by the standards of the day—paid 5.9% of all income taxes. And now? In 2010, 3.9 million taxpayers (2.75% of all taxpayers) were subjected to rates that were 33% or higher. These Americans—many of whom would hardly call themselves wealthy—reported an adjusted gross income of $209,000 or higher, and they paid 49.7% of all income taxes.

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The tax code of the 1950s allowed upper-income Americans to take exemptions and deductions that are unheard of today. Tax shelters were widespread, and not just for the superrich. The working wealthy—including doctors, lawyers, business owners and executives—were versed in the art of creating losses to lower their tax exposure.

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Those 1950s gambits lowered tax liabilities but dissuaded individuals from engaging in the more beneficial activities of increasing their incomes and expanding their businesses. As a result, they were a net drag on the economy. When Ronald Reagan finally lowered rates in the 1980s, he did so in exchange for scrapping uneconomical deductions. When business owners stopped trying to figure out how to lose money, the economy boomed.

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It is a testament to the shallow nature of the national economic conversation that higher tax rates can be justified by reference to a fantasy—a 91% marginal rate that hardly any top earners paid.

In reality, tax policies that diminish the incentives and capacities of innovators, business owners and investors will not spur economic improvement. Such policies will, however, satisfy the instincts of those who want to "stick it to the rich." Never mind that the rich have already been stuck fairly well."

http://online.wsj.com/article/SB1000142412788732470510457815...


Ouch. Pretty devastating to the liberal argument.
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I grew up in the 50's when the top rate was that or higher. Times were pretty good. I don't recall a lot of whining and complaining, either.
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I grew up in the 50's when the top rate was that or higher. Times were pretty good. I don't recall a lot of whining and complaining, either.
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I remember when you used to be able to get a Hershey for a nickel. A nickel!
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I remember when you used to be able to get a Hershey for a nickel. A nickel!
--------------

Liar! You were still in diapers.

arrete
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I grew up in the 50's when the top rate was that or higher. Times were pretty good. I don't recall a lot of whining and complaining, either.

You obviously couldn't be bothered to read the article and actually learn something. There wasn't a lot of whining and complaining because almost no one was paying high rates.
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I remember when you used to be able to get a Hershey for a nickel. A nickel!

You lie!!! Oops, wrong poster.
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"I grew up in the 50's when the top rate was that or higher. Times were pretty good. I don't recall a lot of whining and complaining, either. "

MOst people paid a lot less back then $$ wise, but paid more - the middle class contribute almost double the tax load than they do today!

THe rich, if you bothered to read the article, didn't pay the taxes. Only 286 taxpayers hit the top bracket. Only 296 out of gazillions..well, tens of thousands...and very few were in the next bracket.

In case you haven't bothered to note it, when taxes are high, folks use tax avoidance to a larger degree.

Why do you think Obama owns double tax free bonds? Right...to avoid paying il and fed taxes on the income!.....

Same for all the other 'rich' folks.....

and why do you think MLPS and Oil/Gas partnerships are in demand? Right...buy them and get to take gigantic 'losses' up front.

Duh!....dumb libs.....

You realize that of the 90 billion Obama hopes to raise by 'taxing the rich', he'd be lucky to get 1/3rd of that as folks defer income, switch to non taxable income, form trusts and LLCs to shelter the income, use life insurance trusts to totally bypass the tax man?

I had lunch with my cap venture friend today. He's setting up a life insurance trust. Will move a million in assets to it. it gathers income tax free. He can take out money each year as 'expense money' to 'oversee' the investments. Like go to HI and visit a solar farm and other potential 'investment opportunities' and write the whole trip off...against the money he takes out of the life insurance trust. When he dies, the money goes tax free to his dependents.... Nice deal.....

As long as the trust fund assets are 'managed' by him, he can write off much of his car and travel. Just pop in here and there, spend five minutes 'investigating' opportunities to invest...and have it all tax free!...what a deal. Seems all his buddies are doing that.

The income is sheltered. He can take out tens of thousands a year....as 'expenses'....have no additional income to pay taxes on ....leave millions to his dependents..... tax free. Oh, he does have to buy some life insurance, but within that - he is free to invest in assets.......



t.
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"
You obviously couldn't be bothered to read the article and actually learn something. There wasn't a lot of whining and complaining because almost no one was paying high rates. "

Worse, he didn't read it to realize the lower and middle income folks were actually paying a HIGHER percentage of the total tax take!



t.
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I remember 10c Cokes or Nehi orange soda..but they were a lot smaller bottles...and heavy glass.....

I think candy bars were 5c each when I was about 8 or 10 years old. A loaf of bread was like 12c.

in high school, I bought 3 8oz cartons of milk...they were 2c for a 8oz carton. I liked milk......later developed lactose intolerance....so now only a tiny bit of milk with cereal or in coffee.....

Then again, back in the 50s, the minimum wage was like 35c/hour.... I know it was 85c an hour in 1965 when I had a part time job in college.....

And in the 50s, the milk man delivered milk to the milk box on the back steps.....but you had to go to the store to get bread. No frozen foods either...that was just coming along. Lots of canned veggies.....during the winter months.



t.
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>>I remember when you used to be able to get a Hershey for a nickel. A nickel! <<

Me too! And cokes were a dime!
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">>I remember when you used to be able to get a Hershey for a nickel. A nickel! <<"

A 3 Musketeers..... and now they are about $1.30 for a smaller bar....



t.
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Ouch. Pretty devastating to the liberal argument.

No, most devastating to the liberal argument is allowing the "Bush Tax Cuts" to expire only pays for 8 days of government.

"Its the spending stupid" is the real argument.

JLC
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I remember when you used to be able to get a Hershey for a nickel. A nickel!


Ha... You do not... I'm older than you and I can only remember when they were a dime.
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You both lie, at our ages you can't remember what happened 5 mins ago!
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I remember when you used to be able to get a Hershey for a nickel. A nickel!
--------------

Liar! You were still in diapers.

arrete



Seinfeld and Twix:

http://www.youtube.com/watch?v=ks3oItDhr_E

(Jump to 5:57)
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You both lie, at our ages you can't remember what happened 5 mins ago!


At our ages it's much easier to remember what happened 40 years ago than what happened 5 minutes ago.
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Liar! You were still in diapers.

arrete



Hec, I remember when diapers were 2 cents per pair in Mongolia!! And this wasn't your modern-day, spoil brat, Pampers diapers either.

These were diapers made of a complex interlace of hemp fiber, Bermuda grass, stringy Oak tree roots, and barber shop floor sweepings....don't laugh, it did the job!!

I had to crawl uphill, 2 miles uphill each way to the nearest Mongolian General Store to acquire these fancy diapers. And I put them on myself, at the age of 2 months!....damn parents were busy invading China and climbing the Great Wall on their horses.
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I remember when you used to be able to get a Hershey for a nickel. A nickel!
--------------

Liar! You were still in diapers.

arrete



Seinfeld and Twix:

http://www.youtube.com/watch?v=ks3oItDhr_E

(Jump to 5:57)


I'm pretty sure that you, me, BHM, and 2828 are the only ones who pick up on all these Seinfeld references. That's what was so vexing. :-)
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I'm pretty sure that you, me, BHM, and 2828 are the only ones who pick up on all these Seinfeld references. That's what was so vexing. :-)

That's why you need to use more Doors lyrics.
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"I'm pretty sure that you, me, BHM, and 2828 are the only ones who pick up on all these Seinfeld references."

Who is Seifeld.? Never watched him on TV if that is where he showed up.

Haven't watched a network prime time show in 15 years.....are they still on? THink I've heard of the Simpsons and Sponge Bob......


I watch the History channel, Discovery CHAnnel, Military channel.....a few movies here and there (no pay channels....).....

And Fox News and FNN.....


t.
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I totally got the reference....the candy bar brouhaha at the car dealership. Funny stuff.

I've probably watched 80-90% of the episodes....the misses were probably mainly in the very early years. But I definitely haven't watched every episode 5 times like Andrew has. <g>
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I totally got the reference....the candy bar brouhaha at the car dealership. Funny stuff.

I've probably watched 80-90% of the episodes....the misses were probably mainly in the very early years. But I definitely haven't watched every episode 5 times like Andrew has. <g>


Did you pick up on my Seinfeld reference in my post about Seinfeld references? :-)
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Did you pick up on my Seinfeld reference in my post about Seinfeld references? :-)


Oh yeah, I remember how Kevin Bacon was the glue that connected and referred to everything on Seinfeld. One of the most pivotal moments in the history of Seinfeld. That guy was hub spoke galore!
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Did you pick up on my Seinfeld reference in my post about Seinfeld references? :-)

Oh yeah, I remember how Kevin Bacon was the glue that connected and referred to everything on Seinfeld. One of the most pivotal moments in the history of Seinfeld. That guy was hub spoke galore!



What are you talking about?


Jerry: Well...actually, we kind of broke up.

George: You what?

Jerry: Well, you know, we were having dinner the other night, and she's got this strangest habit. She eats her peas one at a time. You've never seen anything like it. It takes her an hour to finish them. I mean, we've had dinner other times. I've seen her eat Corn Niblets. 4But she scooped them.

George: . . . she scooped her niblets?

Jerry: Yes. That's what was so vexing.
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What are you talking about?


You mean you missed that episode where Kevin Bacon tied all the loose ends on the show?

Geezz....I bet Andrew knows what I'm talking about.
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AOLF wrote: You mean you missed that episode where Kevin Bacon tied all the loose ends on the show?


I know there's a parlor game called "Six Degrees of Kevin Bacon" but concept didn't originate on Seinfeld.

http://en.wikipedia.org/wiki/Six_Degrees_of_Kevin_Bacon

Here they're talking about it on the Seinfeld blog.

http://www.stanthecaddy.com/six-degrees-of-kevin-bacon-seinf...
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I'm pretty sure that you, me, BHM, and 2828 are the only ones who pick up on all these Seinfeld references. That's what was so vexing. :-)


Almost as vexing as dating a woman who eats her peas one at a time, even though she scoops corn niblets.
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"I'm pretty sure that you, me, BHM, and 2828 are the only ones who pick up on all these Seinfeld references."

Who is Seifeld.? Never watched him on TV if that is where he showed up.



I've never watched one single episode of I Love Lucy. Ever. ;-)
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I know there's a parlor game called "Six Degrees of Kevin Bacon" but concept didn't originate on Seinfeld.

http://en.wikipedia.org/wiki/Six_Degrees_of_Kevin_Bacon

Here they're talking about it on the Seinfeld blog.

http://www.stanthecaddy.com/six-degrees-of-kevin-bacon-seinf......




Kevin Bacon was integral to the Seinfeld show. In fact, he was the write on several of the shows....which is ironic given that his name is Bacon in a show set in New York City.

Kevin Bacon tried to hide this fact from the public. The guy was a brilliant writer of comedy - had a brief stint as a writer for the Johnny Carson Show in the 1970's.....most people just think of him as that great dancer in the movie Footloose. No sir.

In fact, he's also competed as a Curling champion in the 1988 Winter Olympics in Seoul, Korea. Won Silver Medal.
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You're right! From Wiki:

Seinfeld was produced by Castle Rock Entertainment in association with Columbia Pictures Television. In syndication the series was distributed by Columbia Pictures Television and Columbia TriStar Television, but Sony Pictures Television has distributed the series since 2002. It was largely co-written by David and Seinfeld with input from numerous script writers, including Larry Charles, Peter Mehlman, Gregg Kavet, Andy Robin, Carol Leifer, David Mandel, Jeff Schaffer, Steve Koren, Jennifer Crittenden, Tom Gammill, Kevin Bacon, Max Pross, Charlie Rubin, Marjorie Gross, Alec Berg, Elaine Pope and Spike Feresten.
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"Hec, I remember when diapers were 2 cents per pair in Mongolia!! And this wasn't your modern-day, spoil brat, Pampers diapers either.
These were diapers made of a complex interlace of hemp fiber, Bermuda grass, stringy Oak tree roots, and barber shop floor sweepings....don't laugh, it did the job!!" aolf

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I'm pretty sure diapers in Mongolia would be made out of woven Yak hair.

Art
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