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View Diary: Give Me One Good Reason Why The Rich Should Pay Higher Taxes (214 comments)

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  •  I can't say how wrong that is (3+ / 0-)
    Recommended by:
    burrow owl, Huginn and Muninn, DawnN

    It made a HUGE difference on what income was subject to tax.  If somebody pre-1986 made $10 million and could shelter 90% of that, and paid a 90% rate on the rest, they paid $900,000.  If they can shelter on $1 mlllion and pay only a 30% rate, they pay 30% times $9 million, or $2.7 million.  

    top marginal rates -- what you call the percentage -- are MEANINGLESS without also discussing what income is actually SUBJECT TO  those rates.  That's why every legitimate listing of marginal rates puts a caveat -- as did the one that the diarist cites -- that statistics pre-1986 don't correlate to statistics post 1986.  Because there was a huge difference in what income was taxed.  

    •  How about comparing what % they actually paid (1+ / 0-)
      Recommended by:
      Ahianne

      to their AGI?  

      Compare 1980 to 2007.  

      Those numbers are available in the Tax Foundation document sited in the diary and generally support the concept that while the 1986 "Reform" legislation did change the definitions, the amount reported before and after that year as AGI and the effective rate of tax based on how much of that AGI was paid in taxes were not radically different.

      Looking just at effective rate of tax paid tells much the same story.  They're making much more and paying a much smaller portion of it in taxes.

      It's 'redistribution' whether it happens before or after the money is made and whether it goes up to a small group or down to a larger one.

      by Into The Woods on Thu May 13, 2010 at 06:30:20 PM PDT

      [ Parent ]

      •  Yes, the rich paid more in (1+ / 0-)
        Recommended by:
        Into The Woods

        1980 -- they paid an effective federal income tax rate of 22.3%.  Under Clinton, in 2000, they paid 24.2%.  In 2007, under Bush, they paid around 19%.  

        They are about to go back up to Clinton rates on post-1986 AGI when the Bush tax cuts expire, so they'll go back (most likely) to around 24% (or the highest rate since the CBO began keeping statistics in 1979).  

        What's scary to me, frankly, is that a return to the Clinton tax rates on post-1986 AGI is already built in to the budget projections and the projected deficits are still completely unsustainable,   even according to the Obama administration.

        That tells you that, while the rich are going to pay more -- it's already built in -- everybody else is ALSO going to be paying significantly more, as well.  

    •  1950s (1+ / 0-)
      Recommended by:
      Into The Woods

      I do not accept your contention that during the 1950s someone who made $10M had access to shelters for 90% of it. Those shelters evolved later.

      •  If you ever find data that goes back further (0+ / 0-)

        please post it somewhere.

        It's 'redistribution' whether it happens before or after the money is made and whether it goes up to a small group or down to a larger one.

        by Into The Woods on Fri May 14, 2010 at 02:34:23 PM PDT

        [ Parent ]

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