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In reply to the discussion: Lies about Ronald Reagan [View all]JHB
(37,158 posts)43. Even more than the rate, it was the distribution
Last edited Sun Oct 20, 2013, 11:55 AM - Edit history (3)
Borrowing this from a post I made back in March:
Most discussion of tax history mentions the top marginal rates of the past (91% in the 50s, 70% in the 60s and 70s, 50% through most of Reagan's presidency, etc.)
I like to highlight a different aspect: leaving aside what the rates were, where did they kick in? We live in times where people argue "are couples who make $250K 'rich'?" "Should we raise taxes on people who make over $250K? Over $500K?"
Where did these sorts of things lie in the past?
Using the inflation adjusted historical tax bracket tables from The Tax Foundation for married couples filing jointly, let's break it down a little and find out the equivalents in 2012 dollars:
1945:
Total number of brackets: 24
# of brackets only affecting income over $250K: 14
# of brackets only affecting income over $500K: 9
Top bracket affects income over: $2,551,044
1955:
Total number of brackets: 24
# of brackets only affecting income over $250K: 16
# of brackets only affecting income over $500K: 11
Top bracket affects income over: $3,426,776
1965:
Total number of brackets: 25
# of brackets only affecting income over $250K: 13
# of brackets only affecting income over $500K: 8
Top bracket affects income over: $1,457,740
1975:
Total number of brackets: 25
# of brackets only affecting income over $250K: 9
# of brackets only affecting income over $500K: 5
Top bracket affects income over: $853,509
1985:
Total number of brackets: 15
# of brackets only affecting income over $250K: 1
# of brackets only affecting income over $500K: 0
Top bracket affects income over: $360,650
1995:
Total number of brackets: 5
# of brackets only affecting income over $250K: 1
# of brackets only affecting income over $500K: 0
Top bracket affects income over: $386,423
2005:
Total number of brackets: 6
# of brackets only affecting income over $250K: 1
# of brackets only affecting income over $500K: 0
Top bracket affects income over: $383,773
2013:
Total number of brackets: 7
# of brackets only affecting income over $250K: 2
# of brackets only affecting income over $500K: 0
Top bracket affects income over: $440,876
Special Bonus Gipper edition numbers:
1988:
Total number of brackets: 2 (No, not a typo. Two brackets)
# of brackets only affecting income over $250K: 0
# of brackets only affecting income over $500K: 0
Top bracket affects income over: $57,738
(There was a reason why Poppy Bush had to go back on his 'Read My Lips' line -- this rate was so low it was unsustainable (naturally, they crucified him for it). And every RWNJ wants to go back to this, or lower...)
ALL income tax progressivity for very high incomes was eliminated under Reagan, and has stayed that way ever since.
I like to highlight a different aspect: leaving aside what the rates were, where did they kick in? We live in times where people argue "are couples who make $250K 'rich'?" "Should we raise taxes on people who make over $250K? Over $500K?"
Where did these sorts of things lie in the past?
Using the inflation adjusted historical tax bracket tables from The Tax Foundation for married couples filing jointly, let's break it down a little and find out the equivalents in 2012 dollars:
1945:
Total number of brackets: 24
# of brackets only affecting income over $250K: 14
# of brackets only affecting income over $500K: 9
Top bracket affects income over: $2,551,044
1955:
Total number of brackets: 24
# of brackets only affecting income over $250K: 16
# of brackets only affecting income over $500K: 11
Top bracket affects income over: $3,426,776
1965:
Total number of brackets: 25
# of brackets only affecting income over $250K: 13
# of brackets only affecting income over $500K: 8
Top bracket affects income over: $1,457,740
1975:
Total number of brackets: 25
# of brackets only affecting income over $250K: 9
# of brackets only affecting income over $500K: 5
Top bracket affects income over: $853,509
1985:
Total number of brackets: 15
# of brackets only affecting income over $250K: 1
# of brackets only affecting income over $500K: 0
Top bracket affects income over: $360,650
1995:
Total number of brackets: 5
# of brackets only affecting income over $250K: 1
# of brackets only affecting income over $500K: 0
Top bracket affects income over: $386,423
2005:
Total number of brackets: 6
# of brackets only affecting income over $250K: 1
# of brackets only affecting income over $500K: 0
Top bracket affects income over: $383,773
2013:
Total number of brackets: 7
# of brackets only affecting income over $250K: 2
# of brackets only affecting income over $500K: 0
Top bracket affects income over: $440,876
Special Bonus Gipper edition numbers:
1988:
Total number of brackets: 2 (No, not a typo. Two brackets)
# of brackets only affecting income over $250K: 0
# of brackets only affecting income over $500K: 0
Top bracket affects income over: $57,738
(There was a reason why Poppy Bush had to go back on his 'Read My Lips' line -- this rate was so low it was unsustainable (naturally, they crucified him for it). And every RWNJ wants to go back to this, or lower...)
ALL income tax progressivity for very high incomes was eliminated under Reagan, and has stayed that way ever since.
Let me repeat that last part:
ALL income tax progressivity for very high incomes was eliminated under Reagan, and has stayed that way ever since.
Brackets reached up into the equivalent of millions today. (heck, between 1936 and 1941 the top bracket kicked in at (inflation-adjusted) incomes in the ballpark of $80 million). That had been eroded by inflation, but it was cut off at the ankles under Reagan.
There are plenty of details that can be argued, but the basic structure worked for people trying to get ahead. Now it works for those who already are.
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~ 900 billion debt combined from every administration up through the end of Carter.
Mc Mike
Sep 2013
#49
You are absolutely correct, there was many signs he had Alzheimer's during his second term.
Thinkingabout
Sep 2013
#35
"The only people who like Reagan are the rich who benefited from his policies" - This is not true
Ohio Joe
Sep 2013
#16
The lie that drove me over the edge was the one about him being "the great communicator".
Grammy23
Sep 2013
#32
That anything close to a majority of the American people ever supported his policies...
YoungDemCA
Sep 2013
#44