80% tax rate Means prosperity

Quote from JerryAdler:

I think you need to provide some clarity on this statement as well: "... especially successful European economies." Please name those "successful" economies. The highest tax rate in Europe is in the UK where personal income is taxed at a rate of 50%. Hardly the 80% you propose. Even in Germany, which could be regarded as a reasonable success even though their national debt exceeds 83% of GDP, only taxes at the rate of 45%.
The American corporate tax rate is near the highest in the world, topping out at 35%, trailing only Japan which has a 39.5% rate.

Tax rate alone does not define success. Rather it is productivity. Gross national product, or GDP, is the most important factor in successful economies. Confiscatory tax policy has never produced robust economies regardless what time frame in history you look at. It was robust productivity that grew the economy notwithstanding the high tax rates of any particular period in American history.

So once again, please describe how your tax model would improve the economy without taking into consideration productivity.
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Please you need to read better.

This is progressive marginal tax talk topping at 80%.

Success is a word we interpret according to your definitions. I see that to you Europe is s##hole, I se countries like Germany, France, Switzerland, Finland and Sweden way different. I think we can learn many of the things they do right. But right is also a political point of view.

The book tax rate in the US is one of the highest while the real tax rate in the US is one of the lowest in the world; thanks to the many loopholes and bailouts.

However, corporate tax is not my worry, personal income is. And I think a much higher rate like the one we used to have before Reagan would be healthy to US ALL.

Well data shows that over the past 4 decades many countries have grown better than the US with much higher taxes.

Don’t forget the US does not have the highest standard of living in the world. Don’t forget among 15 of the best cities to live in NONE IS AMERICAN.
 
Quote from JerryAdler:

Yes, providing entitlements and benefits that they can't pay for.

Europe’s $39 Trillion Pension Risk Grows as Economy Falters
Jan. 11 (Bloomberg) -- Even before the euro crisis, people were worried about Europe’s pension bomb.

State-funded pension obligations in 19 of the European Union nations were about five times higher than their combined gross debt, according to a study commissioned by the European Central Bank. The countries in the report compiled by the Research Center for Generational Contracts at Freiburg University in 2009 had almost 30 trillion euros ($39.3 trillion) of projected obligations to their existing populations.

Germany accounted for 7.6 trillion euros and France 6.7 trillion euros of the liabilities, authors Christoph Mueller, Bernd Raffelhueschen and Olaf Weddige said in the report.

http://www.businessweek.com/news/20...on-pension-risk-grows-as-economy-falters.html

You seem to overlook the fact that none of these countries can cover the obligations which they committed to when they chose socialized democracy as their government model. Except for Germany, the EU is notoriously unproductive, producing very little in the way of goods and services which would provide the tax base to support these entitlements. It's just a lot of nonsense that the EU model has any viability over the long haul. It's merely a matter of time before it implodes.
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They are not without problems and excesses like we are.

The euro currency was a great idea poorly developed.

Our models hardly works as well.
 
Quote from trefoil:

(I just know I'm going to regret this.)

A little research (this stuff only takes five minutes to do. Why no one does it is beyond me):

US average GDP growth, 1948 - 1979: 1.038426809
US average GDP growth, 1980 - 2011: 1.026364652

Source: http://research.stlouisfed.org/fred2/graph/?id=GDPC1

At minimum, higher progressive rates than what we have today don't hurt. That's the actual evidence.
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Thank you.
 
Quote from futurecurrents:

Is capitalism bad? No. Just like not giving to charity is not bad. Is capitalism good? Depends on one's definition of good.
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I dont think capitalism is the isue here. There are many types of capitalism and many systems and economic order.

In fact we have a system closer to corporatism.
 
Quote from trefoil:

You really don't know the difference between anecdote and evidence, do you?
The difference is in one case you measure the data and report the results. The other is to take a small slice of the data, in this case four years out of 54, and focus in on that, in this case it appears to attempt to distract from the rest.
I stated that high tax rates stabilize the economy. The data shows that to be correct. End of story.
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I don’t think high tax rates alone stabilize or destabilize the economy.

I think the US as we know it today would be impossible had taxes not been as high as they were between 1940 and 1980. Real tax rates were never cut. President reagan was the first to substitute them with high levels of debt; Something real painful to the whole country and economy.

I think for the kind of society we have today we need higher taxes on those who can pay more. And going back to the old tables could do us some real good.
 
Quote from JerryAdler:

Once again you chose to analyze the data in a vacuum. The data you presented does not show that high tax rates stabilize the economy. It merely compares tax rates to GDP over a 54 year period without taking into account changes in the tax law and other variables which influence the economy. If your data could show a smooth curve demonstrating that increasing tax rates foster stability and economic growth, then you might have something. In essence, you've taken the "data" and used it to draw a false conclusion that can't be supported by the evidence on the ground.
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So do something else with the data and prove me wrong. It's all out there.
 
Messi007, Hee hee hee, I am laughing at my English in my response to you. Your English is at least as good as mine, it appears. Supposedly English is my native tongue.
 
Quote from trefoil:

So do something else with the data and prove me wrong. It's all out there.
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WSJ: Tax Revenues = 19% of GDP, Regardless of Tax Rates
Weekend Wall Street Journal op-ed, There's No Escaping Hauser's Law, by W. Kurt Hauser (Stanford University, Hoover Institution):

Tax revenues as a share of GDP have averaged just under 19%, whether tax rates are cut or raised. Better to cut rates and get 19% of a larger pie.

Even amoebas learn by trial and error, but some economists and politicians do not. The Obama administration's budget projections claim that raising taxes on the top 2% of taxpayers, those individuals earning more than $200,000 and couples earning $250,000 or more, will increase revenues to the U.S. Treasury. The empirical evidence suggests otherwise. None of the personal income tax or capital gains tax increases enacted in the post-World War II period has raised the projected tax revenues.

Over the past six decades, tax revenues as a percentage of GDP have averaged just under 19% regardless of the top marginal personal income tax rate. The top marginal rate has been as high as 92% (1952-53) and as low as 28% (1988-90). This observation was first reported in an op-ed I wrote for this newspaper in March 1993. A wit later dubbed this "Hauser's Law."

Over this period there have been more than 30 major changes in the tax code including personal income tax rates, corporate tax rates, capital gains taxes, dividend taxes, investment tax credits, depreciation schedules, Social Security taxes, and the number of tax brackets among others. Yet during this period, federal government tax collections as a share of GDP have moved within a narrow band of just under 19% of GDP.

Why? Higher taxes discourage the "animal spirits" of entrepreneurship. When tax rates are raised, taxpayers are encouraged to shift, hide and underreport income. Taxpayers divert their effort from pro-growth productive investments to seeking tax shelters, tax havens and tax exempt investments. This behavior tends to dampen economic growth and job creation. Lower taxes increase the incentives to work, produce, save and invest, thereby encouraging capital formation and jobs. Taxpayers have less incentive to shelter and shift income.


http://taxprof.typepad.com/taxprof_blog/2010/11/wsj-hausers-law.html

I'll let the experts prove you wrong.
 
"Tax changes have very large effects: an exogenous tax increase of 1 percent of GDP lowers real GDP by roughly 2 to 3 percent."

How do changes in the level of taxation affect the level of economic activity? The simple correlation between taxation and economic activity shows that, on average, when economic activity rises more rapidly, tax revenues also are rising more rapidly. But this correlation almost surely does not reflect a positive effect of tax increases on output. Rather, under our tax system, any positive shock to output raises tax revenues by increasing income.

http://www.nber.org/digest/mar08/w13264.html
 
The Effect of Marginal Tax Rates on GDP Growth

(Sorry, you'll have to read the whole article to get the point).


......
In order to find out, we crunched the numbers. We went to the Bureau of Economic Analysis website and looked up GDP growth for every year since 1930. Then we went to the Internal Revenue Service website and pulled up the top marginal tax rate for those years. We then averaged the annual GDP growth rate for various tax levels. This is a very cursory examination of the numbers, but if the contention of those pushing for the Bush tax cuts to be retained is true, then we should see some correlation between the growth of the economy and tax rates.

We didn't. In fact, if you use history as your guide, then we should set the top marginal rate at 88 percent. Why 88 percent? Because during the time that this was the top marginal rate, the GDP expanded at a rate that even countries like China and Brazil would envy -- 17.5 percent. And we need to make sure that we set it at 88 percent, not 86.45 percent. Setting the tax rate at that level historically provided us with GDP contraction of 5.9 percent.



.....
Ideologues who read this will naturally jump and say that we are calling for an increase of the top marginal rate to 88 percent. Hardly. What we are saying is that an examination of the historical record of the past 80 years shows no correlation between the top marginal rate and economic growth. There is a big difference between the two statements, and if an ideologue wants to pretend there isn't, they're being disingenuous.

http://buyandholdplus.com/blog/2010/09/the-effect-of-marginal-tax-rates-on-gdp-growth.html
 
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