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View Diary: Champagne compensation for CEOs, near-beer wages for workers (64 comments)

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  •  Higher marginal tax rates have a positive effect (1+ / 0-)
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    howd

    I do think that higher marginal tax rates on high earners do have a moderating effect. We don't have any data on high tax rates in the post TRA86 era, and rates before 1986 aren't useful for analysis purposes. However, a top federal marginal rate on income over $5 million of 50% would likely help. These CEOs and senior executives are all earning income that is taxed at the highest rate on their salaries, cash bonuses, and all equity compensation including options and qualified stock grants. None of this income is subject to long term capital gains treatment so higher marginal rates do have a bite.

    "let's talk about that"

    by VClib on Thu May 03, 2012 at 07:15:05 PM PDT

    •  Had 90-70% Marginal Tax on Excessive Income (0+ / 0-)

      ... during the 40s-60s and CEO:Worker income ratio was 20-30x.  Reagan began cutting the marginal tax rate and now it sits at 35% and CEO are taking 200x of what they pay their workers.  If you don't let the CEOs keep all that excess income, they really won't have much incentive for taking it all for themselves and  end up hiring more workers and paying them more.  Simple really.  But it will be near impossible to get that genie back in the bottle, especially with Citizen United.

      Poor man wants to be rich. Rich man wants to king. And the king ain't satisifed until he rules everything. B.Springsteen

      by howd on Thu May 03, 2012 at 09:22:37 PM PDT

      [ Parent ]

      •  howd - but you can't compare pre 86 tax rates (1+ / 0-)
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        nextstep

        and post the Tax Reform Act of 1986 tax rates, they are apples and oranges. You make a valid point but when you refer to pre'86 rates any student of tax policy will dismiss your argument as too simplistic.

        "let's talk about that"

        by VClib on Fri May 04, 2012 at 07:25:14 AM PDT

        [ Parent ]

      •  howd - just as an example (0+ / 0-)

        My suggestion that rates be raised on very high incomes to 50% would result in a higher effective rate (what people actually pay) than the 90% rate in the 50s. This is due to the fundamental change in the personal tax code that resulted when TRA86 was passed.

        "let's talk about that"

        by VClib on Fri May 04, 2012 at 09:32:11 AM PDT

        [ Parent ]

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