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Politics : A US National Health Care System? -- Ignore unavailable to you. Want to Upgrade?

To: John Koligman who wrote (7183)	6/23/2009 9:58:28 PM
From: i-node	1 Recommendation Read Replies (1) \| Respond to of 42652

As I said in my prior post, we had several decades in this country where the top rates were as high as 90% and seemed to do just fine. Actually, one decade + 2 years (1951-1963), plus a 2 year period during WWII. And it wasn't quite 90% then due to the maximum rate limitation which capped the effective rate at just under 90%. And these were on incomes over $3,000,000 in today's dollars. But the important point is at that taxes as a percentage of GDP have risen over the same period by a couple of percentage points. I just don't know how a person in his right mind can propose something like a 50 or 90% tax rate. On ANYONE. Intuitively, it would kill the economy, and frankly, you take everyone's income over $3,000,000 and not make a dent in the problem. Look, we've already got a socialist tinkering around with 1/6 of the economy. Let's not turn him loose on the Internal Revenue Code. You guys ought to at least give the country a fighting chance for survival.

To: John Koligman who wrote (7183)	6/23/2009 11:28:33 PM
From: TimF	1 Recommendation Read Replies (1) \| Respond to of 42652

We briefly had 90% (and long had 70%) rates that very few people paid. Not only did few people make enough income to hit those rates (except perhaps near the end of the 70% rate and even then the percentage of people with that level of income was lower than the percentage paying the top rate in recent years), but also people who did make enough income to pay that rate had every incentive to legally (there where plenty of loopholes) or illegally shield it from taxation. And while we "did just fine" (largely because few people paid that much in taxes), they did have a negative effect. For one thing they distorted compensation and investment. They helped create the employer sponsored pre-paid medical plans / medical "insurance", that has contributed to our high medical cost. And you had resources go in to fancy fringe benefits and expense accounts, rather than more efficiently in to extra wages/salaries that could go to whatever people want or need. Then just the effort to create legal and illegal tax evasion schemes uses up resources, and diverts more resources in to those schemes rather than in to the most productive investments. There where a lot of positive factors working to help the economy grow, the lack of major power wars after WWII, the expansion of world trade, demographic issues, to name just a few. But the high tax rates where a negative factor. 90% tax rates are just senseless, they don't even increase tax income they decrease it. There is no benefit to them unless you consider "bringing down the rich" to be a benefit. I don't, and even if it was the tax rates hurt the near rich and slightly rich (who need a lot of income to become seriously rich) a lot more than the very rich.