Comment by AnthonyMouse
2 hours ago
> This is more a disagreement of values than facts, I think.
It's a disagreement over policy. Increasing inequality is bad, the question is what's the best way to do something about it? There are many alternatives with better characteristics than a wealth tax, like antitrust enforcement to break up concentrated industries and lower corporate profits through increased competition, zoning reform to reduce housing costs so that ordinary people keep more of what they earn instead of paying it to banks or landlords, tax reform to remove existing advantages in the tax code for huge multinational corporations over domestic small businesses owned by ordinary people, etc.
> High marginal income taxes (it was 91% in 1963, 70% until 1981, there's your compelling case where they turned out to be right, inequality was not growing then like it is now)
The high marginal rates in the mid-20th century were fake. The tax code at the time had so many loopholes that nobody really paid them. When the rates were lowered in the 1980s, many of the loopholes were closed at the same time, resulting in the "federal receipts as a percent of GDP" chart looking like this:
https://fred.stlouisfed.org/series/FYFRGDA188S
Which is to say, you'd have trouble using that chart to even guess when it changed.
> Increasing inequality is bad
I'm not at all sure everyone in these discussions agrees on this point!
I agree with you not only that this is bad but also that wealth taxes are not the only way to address it. They are a way that is getting momentum right now, AFAICT more than the other things you mentioned, and we may have to choose between voting for a wealth tax (or candidates who support one) or doing nothing.
fwiw, I'm really not sure which approach(es) I'd choose if I could single-handedly decide how to reduce wealth inequality.
> The high marginal rates in the mid-20th century were fake.
I think "federal receipts as a percent of GDP" isn't the right chart to answer this question. Overall tax rate != how progressive the tax is or how high the "effective" marginal tax rate is. On https://inequality.org/facts/wealth-inequality/ the "The Top .01% Don't Pay Their Fair Share as They Hoard More Wealth" shows a clear cross-over point where before about 1980 the top .01%'s share of tax was greater than their share of wealth, and after it reversed. That's consistent with the 1981 change I mentioned.