Comment 27312

By A Smith (anonymous) | Posted November 14, 2008 at 17:08:53

Ryan, I understand you discounting the "mystical" nature of my theory regarding balance, but keep an open mind.

In 1971, Richard Nixon was concerned about rising prices. At the time, inflation was around 3%, but after the government imposed wage and price controls, inflation spiked above 12 % and would average 9% over the next decade.

As soon as price controls were lifted in 1981, inflation dropped to around 2% in a year.

The same counter intuitive effect has happened with tax rates. As top marginal rates have fallen from 70% (under Carter) to the current 35%, the share of taxes paid by the top 1 % have risen from 19% to 40% (2006).

During this same time period, the bottom 95% of taxpayers have seen their share of taxes paid fall from 63% to 40%.

If this isn't an argument for balance I don't know what is.

High taxes are supposed to result in more money from the rich and yet the opposite is true. How do you explain this?

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