Tax Cuts For The Rich Do Not Spur Economic Growth

The study delves into the last 65 years of U.S. tax policy pertaining to high earning Americans — including top marginal rates on income and capital gains taxes — and how it impacts their decision-making. The conclusion: cutting effective taxes on the rich doesn’t boost economic growth, but it does correlate with rising income inequality.

“Throughout the late-1940s and 1950s, the top marginal tax rate was typically above 90%; today it is 35%. Additionally, the top capital gains tax rate was 25% in the 1950s and 1960s, 35% in the 1970s; today it is 15%. The real GDP growth rate averaged 4.2% and real per capita GDP increased annually by 2.4% in the 1950s. In the 2000s, the average real GDP growth rate was 1.7% and real per capita GDP increased annually by less than 1%,” wrote Thomas L. Hungerford, CRS’ specialist in public finance and author of the report.

Tax Cuts For The Rich Do Not Spur Economic Growth [talkingpointsmemo.com]

Congressional Research Service Study [talkingpointsmemo.com]



Further substantiation proving the fallacy of the biggest lie of the Reagan Revolution.

How else can the wealth transfer from workers to investors be justified?

Tax Cuts For The Rich Do Not Spur Economic Growth

This is a dated topic. Republicans aren't even talking about tax cuts for the wealthy anymore.

The question is "do tax increases for the poor spur economic growth"?

“There is not conclusive evidence, however, to substantiate a clear relationship between the 65-year steady reduction in the top tax rates and economic growth,”

That means the evidence is inconclusive. Well, I'm convinced.

Well, countries that have taxed the rich at 100% havent done that well either, actually.

Once again, people focus on ONE thing, and try to correlate it to everything else. So much has changed in work and technology that we're compared 2 different worlds. Goods also used to cost much, much more due to the labor involved.

“There is not conclusive evidence, however, to substantiate a clear relationship between the 65-year steady reduction in the top tax rates and economic growth,”

That means the evidence is inconclusive. Well, I'm convinced.

Either way, tax cuts don't have to spur economic growth in order to have tax cuts be a good idea.

What people of different income levels pay, as a % of their income, in taxes to state & local and federal governments:

Why are federal taxes progressive and state & local taxes regressive?

Because wealth inequality is a legitimate good?