Friday, October 19, 2012

History's Justice...

"If something is true, you don't have to believe in it..." - Lily Tomlin

I watched a little of the debates...very little.  I just think that the good guys underperform so much, I can't handle it.  This is your job - practice it! Much is at stake. Take a lesson from Reagan - have a plan,  the "HOW," but more important, understand the basic principle behind what you want to do, the more important "WHY".

During the Democratic Party debates in 2008, Charles Gibson (a Democrat) asked candidate Obama, 'why, if you want to raise revenue for the government, would you increase the (capital gains) tax rate, when every time it has been decreased, revenues go up?' (paraphrased)  The would-be President said it was out of "fairness," that he just wanted a fair system.  Since Gibson is on the left, he really doesn't understand the WHY behind reducing tax rates, but at least he knew part of it.  The follow up question, in any REAL debate, would be - "So, Senator Obama, when those tax revenues go UP due to a decrease in the rate - who is paying that money that resulted in an increase in revenue - the poor?"  Its simple.  But not for the simple-minded.

During the Vice Presidential debate between Paul Ryan and Joe Biden, we heard this:

How can the RNC, and the SuperPAC's spend tens of millions of dollars on campaign ads...AND NOT RUN THIS ONE!

The Historical Lessons of Lower Tax Rates by Daniel Mitchell

Tax rates were slashed dramatically during the 1920s, dropping from over 70 percent to less than 25 percent. What happened? Personal income tax revenues increased substantially during the 1920s, despite the reduction in rates. Revenues rose from $719 million in 1921 to $1164 million in 1928, an increase of more than 61 percent.

Fair? President Obama?

The share of the tax burden paid by the rich rose dramatically as tax rates were reduced. The share of the tax burden borne by the rich (those making $50,000 and up in those days) climbed from 44.2 percent in 1921 to 78.4 percent in 1928.
President Kennedy proposed across-the-board tax rate reductions that reduced the top tax rate from more than 90 percent down to 70 percent. What happened? Tax revenues climbed from $94 billion in 1961 to $153 billion in 1968, an increase of 62 percent (33 percent after adjusting for inflation).

Fair? President Obama?

Just as happened in the 1920s, the share of the income tax burden borne by the rich increased following the tax cuts. Tax collections from those making over $50,000 per year climbed by 57 percent between 1963 and 1966, while tax collections from those earning below $50,000 rose 11 percent. As a result, the rich saw their portion of the income tax burden climb from 11.6 percent to 15.1 percent.

President Reagan proposed sweeping tax rate reductions during the 1980s. What happened? Total tax revenues climbed by 99.4 percent during the 1980s, and the results are even more impressive when looking at what happened to personal income tax revenues. Once the economy received an unambiguous tax cut in January 1983, income tax revenues climbed dramatically, increasing by more than 54 percent by 1989 (28 percent after adjusting for inflation).

Fair? President Obama?

The share of income taxes paid by the top 10 percent of earners jumped significantly, climbing from 48.0 percent in 1981 to 57.2 percent in 1988. The top 1 percent saw their share of the income tax bill climb even more dramatically, from 17.6 percent in 1981 to 27.5 percent in 1988.


LL said...

I had an interesting discussion with a friend yesterday wherein I said that I don't think that President Obama thinks much about revenue. So long as he had a blank check to borrow as much as he wanted to do whatever he wanted, he could kick that can (debt) down the road and somebody else could worry about it.

And the progressives thought it was a splendid idea.

Which is precisely why I'm not a 'politically progressive' person.

Woodsterman (Odie) said...

It is proven time after time communists don't understand economics.