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America Was Apparently a "Socialist Hellhole" in the Eisenhower Administration

Troubadour

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Top US Marginal Income Tax Rates, 1913--2003 (TruthAndPolitics.org)

In fact, America was apparently an impoverished wasteland for half a century between Franklin Roosevelt and Ronald Reagan. During this grim period of anguish, such horrors occurred as the invention of rock and roll, the creation of the suburban lifestyle, the introduction of television into broad use, the building of the Interstate highways, the landing of human beings on the Moon, the end of segregation, the development of the Internet, the advent of the communications satellite, the creation of the polio vaccine, the eradication of smallpox, the invention of antibiotics, the mass production of aircraft, the introduction of consumer air travel, the rise of American education to #1 in the world, and the largest trade surpluses in America's favor in the history of our nation. The culprits in this devastating Stalinist wasteland:

Franklin Roosevelt
Harry Truman
Dwight Eisenhower
John F. Kennedy
Lyndon Johnson
Richard Nixon
Gerald Ford
Jimmy Carter

But fortunately, America was soon rescued from the scourge of freedom and prosperity by the hero of heroes, Ronald Reagan. In the thirty years since he restored the private sector to its rightful place of absolute dominance over politics, our society has skyrocketed into the stratosphere of glory with such accomplishments as premium coffee bars, mortgage-backed securities trading, phones with touch screens, shoes with lights in them, the loss of (and failure to rebuild) an entire American city, the collapse of our education system, the eradication of American manufacturing, and the largest trade deficits in history with an undemocratic and militarily menacing country. Don't you love this free market paradise?
 

Helvidius

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I suppose I can play this game too. From the time between FDR and Reagan there was: the invention of the atomic bomb, internment of Japanese-American citizens, Watergate, War on Drugs, growing national debt, Korea, Vietnam, conscription into the army, and a host of other things I won't bother listing.

Why are you under the impression we live in a completely free market society?
 

Diogenes

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Don't forget the disaster of LBJ's Great Society programs that led to the hyperinflation of the even more disastrous Carter years. *That* is when Reagan rode to the rescue and, after Obama-Reid-Pelosi, we will need another white knight to get us out of the swamp of Progressivism into which they have driven us.
 

FilmFestGuy

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Top US Marginal Income Tax Rates, 1913--2003 (TruthAndPolitics.org)

In fact, America was apparently an impoverished wasteland for half a century between Franklin Roosevelt and Ronald Reagan. During this grim period of anguish, such horrors occurred as the invention of rock and roll, the creation of the suburban lifestyle, the introduction of television into broad use, the building of the Interstate highways, the landing of human beings on the Moon, the end of segregation, the development of the Internet, the advent of the communications satellite, the creation of the polio vaccine, the eradication of smallpox, the invention of antibiotics, the mass production of aircraft, the introduction of consumer air travel, the rise of American education to #1 in the world, and the largest trade surpluses in America's favor in the history of our nation. The culprits in this devastating Stalinist wasteland:

Franklin Roosevelt
Harry Truman
Dwight Eisenhower
John F. Kennedy
Lyndon Johnson
Richard Nixon
Gerald Ford
Jimmy Carter

But fortunately, America was soon rescued from the scourge of freedom and prosperity by the hero of heroes, Ronald Reagan. In the thirty years since he restored the private sector to its rightful place of absolute dominance over politics, our society has skyrocketed into the stratosphere of glory with such accomplishments as premium coffee bars, mortgage-backed securities trading, phones with touch screens, shoes with lights in them, the loss of (and failure to rebuild) an entire American city, the collapse of our education system, the eradication of American manufacturing, and the largest trade deficits in history with an undemocratic and militarily menacing country. Don't you love this free market paradise?

We've done so well that we now rank as follows:

6th in global innovation-based competitiveness
11th among industrialized nations in the fraction of 25- to 34-year-olds who have graduated from high school
16th in college completion rate
22nd in broadband Internet access
24th in life expectancy at birth
27th among developed nations in the proportion of college students receiving degrees in science or engineering
48th in quality of K-12 math and science education
and 29th in the number of mobile phones per 100 people.

Yay, America!

Source
 

Troubadour

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I suppose I can play this game too. From the time between FDR and Reagan there was: the invention of the atomic bomb, internment of Japanese-American citizens, Watergate, War on Drugs, growing national debt, Korea, Vietnam, conscription into the army, and a host of other things I won't bother listing.

None of those resulted from high income tax rates. The purpose of this thread is to illustrate the absurdity of the common conservative position that high taxes necessarily yield poor economies. Clearly, for the better part of three decades - the period that shaped modern American identity - our society flourished as the envy of the world with tax rates that conservatives today would refer to as practically Communist. I just thought "Wow, I guess "Happy Days" must be some kind of propaganda."

Why are you under the impression we live in a completely free market society?

There's no such thing as a completely free market. All terms are ultimately conditional.
 

DarkWizard12

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None of those resulted from high income tax rates. The purpose of this thread is to illustrate the absurdity of the common conservative position that high taxes necessarily yield poor economies. Clearly, for the better part of three decades - the period that shaped modern American identity - our society flourished as the envy of the world with tax rates that conservatives today would refer to as practically Communist. I just thought "Wow, I guess "Happy Days" must be some kind of propaganda."


There's no such thing as a completely free market. All terms are ultimately conditional.

Yes, America had sucha great economy back in the day, with the great depression and ww2 and all...yeah...
 

Diogenes

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None of those resulted from high income tax rates. The purpose of this thread is to illustrate the absurdity of the common conservative position that high taxes necessarily yield poor economies.
We could probably tolerate the loss of government revenue from higher tax rates if it weren't for the liberals who want to redistribute the wealth, but the country and all of its citizens become more prosperous when the workers are allowed to keep more of what they earn. Kennedy, Reagan and Bush understood that, but Obama doesn't even seem to know anyone who understands it.
 

Ockham

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So the underlying text here is, "Socialism is good" because Americans are so bad at doing things now. Look at all the socialist country's and how well they are "ranking" (and I never believe the ranking bs - its like lying with statistics) and look how baaaaad Reagan was. Is this really the new low of liberal intellectual posting here on DP? Christ ... no wonder I'm hoping the tea party purges idiot thinking such as this - I actually am dumber for reading this thread...
 

Helvidius

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None of those resulted from high income tax rates. The purpose of this thread is to illustrate the absurdity of the common conservative position that high taxes necessarily yield poor economies. Clearly, for the better part of three decades - the period that shaped modern American identity - our society flourished as the envy of the world with tax rates that conservatives today would refer to as practically Communist. I just thought "Wow, I guess "Happy Days" must be some kind of propaganda."

There's no such thing as a completely free market. All terms are ultimately conditional.

Whether or not something is conditional is irrelevant. Free market concerns government involvement in the economy.

None of my examples resulted from high income tax rates? I didn't realize the U.S. fights wars for free. The atomic bomb must have been funded entirely from public donations. Your argument is a shallow one. You cannot simply determine the state of an economy based on how much America's highest earners are taxed. I need to see tax rates for all income brackets, capital gains taxes, taxes on businesses, excise taxes, etc. Not to mention acts of legislation such as NAFTA and the U.S. joining organizations like the WTO are important factors to consider. There is also how heavily taxed different states were and how much they have flourished in these two periods.

Lastly, how exactly did income taxes on the wealthy create vaccines, internet, etc? Polio's funding came from the March of Dimes (public donations), Universities, and research grants from the likes of Rockefeller and others.
 

oldreliable67

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This is a bit beside the specific point the OP was trying for, but it is germane to his effort to prove his point...

Let's not confuse the highest marginal rate and its impact with the overall effective rate. It is one thing to have the highest marginal rate at 90% when the brackets are structured so that only, say, 1/4 of 1% of taxpayers are in that bracket. It is quite another to have the highest marginal rate at 35% or 39.5% when the brackets are structured so that, say, 50% or more of taxpayers are in that bracket.

High marginal tax rates are, of course, oft cited as examples of dis-incentives to innovate and work hard and earn more. After all, if the next $1,000,000 I earn is going to yield only $100,000 to me in after-tax income, what is the point? Is the extra effort really worth it?
 

phattonez

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Ugh, stupid sophism at work again. Will people never learn that correlation does not prove causation?

Look at what else we had after WWII. We started with huge pensions, road projects, etc. There were costs associated with such things that wouldn't have to be realized until, oh, I don't know, right about now? Someone had to pay those pensions, that fell to the current generation. Someone had to pay for the maintenance of the roads, that's falling to this generation. The society of the 1950s was an unsustainable society, and we are reaping the fruit of that time period now.
 

PeteEU

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Ugh, stupid sophism at work again. Will people never learn that correlation does not prove causation?

Look at what else we had after WWII. We started with huge pensions, road projects, etc. There were costs associated with such things that wouldn't have to be realized until, oh, I don't know, right about now? Someone had to pay those pensions, that fell to the current generation. Someone had to pay for the maintenance of the roads, that's falling to this generation. The society of the 1950s was an unsustainable society, and we are reaping the fruit of that time period now.

LOL talk about rewriting history there sport...
 

Missed AB

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top-rates-graphphp.png


Top US Marginal Income Tax Rates, 1913--2003 (TruthAndPolitics.org)

In fact, America was apparently an impoverished wasteland for half a century between Franklin Roosevelt and Ronald Reagan. During this grim period of anguish, such horrors occurred as the invention of rock and roll, the creation of the suburban lifestyle, the introduction of television into broad use, the building of the Interstate highways, the landing of human beings on the Moon, the end of segregation, the development of the Internet, the advent of the communications satellite, the creation of the polio vaccine, the eradication of smallpox, the invention of antibiotics, the mass production of aircraft, the introduction of consumer air travel, the rise of American education to #1 in the world, and the largest trade surpluses in America's favor in the history of our nation. The culprits in this devastating Stalinist wasteland:

Franklin Roosevelt
Harry Truman
Dwight Eisenhower
John F. Kennedy
Lyndon Johnson
Richard Nixon
Gerald Ford
Jimmy Carter

But fortunately, America was soon rescued from the scourge of freedom and prosperity by the hero of heroes, Ronald Reagan. In the thirty years since he restored the private sector to its rightful place of absolute dominance over politics, our society has skyrocketed into the stratosphere of glory with such accomplishments as premium coffee bars, mortgage-backed securities trading, phones with touch screens, shoes with lights in them, the loss of (and failure to rebuild) an entire American city, the collapse of our education system, the eradication of American manufacturing, and the largest trade deficits in history with an undemocratic and militarily menacing country. Don't you love this free market paradise?

What is your point?
 

phattonez

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What is your point?

He's trying to say that we don't have to worry about a high tax rate because at the very least it has a negligible effect on the economy. He's claiming this, though, purely on correlation and without any theoretical explanation.
 

Troubadour

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Don't forget the disaster of LBJ's Great Society programs that led to the hyperinflation of the even more disastrous Carter years.

Your claim makes absolutely no sense. The inflation of the 1970s was not "hyperinflation" by any stretch of the imagination, and there is no mechanism to explain how social programs could cause inflation a decade after the fact. If they caused it at all, it would be nearly instantaneous due to the immediate introduction of money into a consumption-heavy area of the economy. Furthermore, where was all that inflation in the '40s, '50s, and early '60s, when tax rates were two to three times what they are now?

*That* is when Reagan rode to the rescue

Reagan didn't "rescue" anything - he just redistributed money from the public into the private sector, creating a speculative market bubble that nearly destroyed the economy when it burst in 1987. His policies single-handedly made homelessness a major phenomenon in America, created a permanent underclass, and set the stage for the evaporation of the middle-class by undermining basic infrastructure. He basically sold the floor beneath our feet for scrap and told us it was Christmas.

after Obama-Reid-Pelosi, we will need another white knight to get us out of the swamp of Progressivism into which they have driven us.

Tax rates are pretty much the same as they were under Bush, if not lower - even the expiration of Bush's top-rate tax cuts would only increase them by a single-digit percentage. Rates would have to more than double to undo Reagan's tax cuts - our economy is still mired in market fundamentalist dogma.

We've done so well that we now rank as follows:

6th in global innovation-based competitiveness
11th among industrialized nations in the fraction of 25- to 34-year-olds who have graduated from high school
16th in college completion rate
22nd in broadband Internet access
24th in life expectancy at birth
27th among developed nations in the proportion of college students receiving degrees in science or engineering
48th in quality of K-12 math and science education
and 29th in the number of mobile phones per 100 people.

Yes, but those are facts, and facts have a well-known liberal bias. The picture is much more favorable toward conservative policies if you read pigeon entrails.

Yes, America had sucha great economy back in the day, with the great depression and ww2 and all...yeah...

The Great Depression began under a laissez-faire system characterized by regular cycles of economic castastrophe, and they only stopped when the market became regulated and labor standards were introduced in the Roosevelt and subsequent administrations.

The generation that grew up in the FDR, Truman, Kennedy, and Johnson administrations was the first not to experience a major economic depression - growth was so significant and reliable that it became commonplace for Americans to assume that every generation would do better than the last. Republicans were quick to seize on the relatively mild economic troubles 40 years after the Depression, when people's memories of what conservatives had done to America had faded. They've spent the intervening decades slowly murdering the American Dream and replacing it with greed.

We could probably tolerate the loss of government revenue from higher tax rates

The Laffer Curve strikes again! :lamo You're basically claiming that zero taxation would yield infinite revenue.

but the country and all of its citizens become more prosperous when the workers are allowed to keep more of what they earn.

No. There are optimal tax rates, because there are such things as public goods that benefit the economy more than cutting taxes - things like education, roads, public transportation, communications, labor and environmental enforcement, etc. You have no evidence that optimal tax rates are beneath current levels, and the entire point of this thread is that America's "Golden Age" - when its modern culture was formed and its potential seemed boundless - was characterized by much higher rates than we have at present. If you're just against taxation, then your position is not rational or empirically justified.

Kennedy, Reagan and Bush understood that

Kennedy understood that the optimal top rate would be 70%, and even that level was accompanied by Keynesian deficit spending on infrastructure. Ronald Reagan didn't understand anything, he was just an ideologue opposed to progressive taxation who got whatever cuts he could while eviscerating the public sector.

but Obama doesn't even seem to know anyone who understands it.

You certainly don't seem to know anything about President Obama's policies.

So the underlying text here is, "Socialism is good"

You tell me - what is the "underlying text" of the fact that the most prosperous economy in the history of the world, that saw the advent of the modern American middle-class, corresponded to 70-90% marginal income tax rates on the wealthy for nearly half a century?

because Americans are so bad at doing things now.

Americans aren't the problem - it's people in this country who consider themselves above America; people whose only accomplishment was to inherit opportunities they want to deny everyone else; people who are heroes in their own minds for having money; who think paying taxes is beneath their royal dignity; and who believe everyone else should just be grateful to stand in their immaculate presence. Personally, I think they should do their part or get out.

Look at all the socialist country's and how well they are "ranking" (and I never believe the ranking bs - its like lying with statistics)

And that's how conservatives think - say the sky is green, then accuse your window of lying because it shows blue. Nothing new. Orwell identified it as "doublethink."

I didn't realize the U.S. fights wars for free.

That's the point - nothing is free. You can't just keep cutting how much you give to your country and expect to have a country.

You cannot simply determine the state of an economy based on how much America's highest earners are taxed.

I'm not defining an economy by tax rates (unlike conservatives, who do so constantly in the other direction) - I'm correlating high tax rates with the most prosperous economy in the history of the world, which is hard to dismiss given that it was spread over half a century.

I need to see tax rates for all income brackets, capital gains taxes, taxes on businesses, excise taxes, etc.

Fair enough, but does that mean you concede that a MUCH higher top marginal income tax rate can correspond to optimum economic conditions?

Lastly, how exactly did income taxes on the wealthy create vaccines, internet, etc?

Public grants, public universities, federal research programs, etc. All of which falls under the aegis of "infrastructure."

Polio's funding came from the March of Dimes (public donations), Universities, and research grants from the likes of Rockefeller and others.

You mean people gave their money to help out folks too lazy to defeat polio themselves?

Let's not confuse the highest marginal rate and its impact with the overall effective rate. It is one thing to have the highest marginal rate at 90% when the brackets are structured so that only, say, 1/4 of 1% of taxpayers are in that bracket. It is quite another to have the highest marginal rate at 35% or 39.5% when the brackets are structured so that, say, 50% or more of taxpayers are in that bracket.

That is a nuance worth considering, but is it the case that the brackets were structured in that way?

After all, if the next $1,000,000 I earn is going to yield only $100,000 to me in after-tax income, what is the point? Is the extra effort really worth it?

That sort of begs the question - I don't see much reason to believe that making more money at that level necessarily involves more effort, or that it adds more to the economy than it takes away by concentrating it in one person's holdings. At some point it's not even physically possible to work harder, and the extra money one makes is just economic inertia and luck - not exactly sacrosanct market forces.

Once someone no longer has to work anymore, can do whatever they want whenever they want, and can afford pretty much anything, what does it serve other than their ego and fanatical anti-government ideology to not assert public prerogatives more strongly? Chances are, the money is not going back in the economy: It will either be put into assets or invested speculatively to drive bubbles that ultimately deprive the economy of that value. We've now seen this happen multiple times: Reagan's policies are a failure and the claims behind them have been discredited several times over.

The society of the 1950s was an unsustainable society, and we are reaping the fruit of that time period now.

No, it wasn't - the expenses incurred during those decades were largely paid as they went. It wasn't until the Reagan administration that the National Debt exploded. Perhaps we could survive on tax rates that low if we let go of our military-industrial complex, but otherwise you either have to raise taxes back to sustainable levels or dissolve the United States of America (an option some Republicans already seem to have a fancy for, since they've decided paying taxes is some sort of sin).

brillig-nom-national-debt.gif


What is your point?

That right-wing rhetoric about "socialism" is ignorant and insane.
 
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phattonez

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Reagan increased spending, so I'm not sure my point has exactly been debunked.
 

phattonez

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Missed AB

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He's trying to say that we don't have to worry about a high tax rate because at the very least it has a negligible effect on the economy. He's claiming this, though, purely on correlation and without any theoretical explanation.

A rather long winded way to get to that point... Do people think people actually PAID 90% in taxes? The tax rate was that high to try to get ANY payments from the "rich". That people were not paying ANY taxes is the reason for the AMT.
 

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Your claim makes absolutely no sense. The inflation of the 1970s was not "hyperinflation" by any stretch of the imagination, and there is no mechanism to explain how social programs could cause inflation a decade after the fact. If they caused it at all, it would be nearly instantaneous due to the immediate introduction of money into a consumption-heavy area of the economy. Furthermore, where was all that inflation in the '40s, '50s, and early '60s, when tax rates were two to three times what they are now?
The effects are certainly not instantaneous because the unintended consequences, even when foreseen by a sizable minority, often take a while to surface. For the latest example, note that the current recession began about a year after the Dems took over Congress.

The inflation of the Carter years was particularly bad because it pushed us all into the astronomical tax brackets that no one had ever paid before. Even with my modest income, I remember those years as when I had to make a 20% return on my investments just to break even: inflation was 10% and taxes took half.

Reagan didn't "rescue" anything - he just redistributed money from the public into the private sector, ...
Hogwash. What he really did was cancel the liberal redistribution of money from those who earned it to those who didn't.

His policies single-handedly made homelessness a major phenomenon in America, created a permanent underclass, and set the stage for the evaporation of the middle-class by undermining basic infrastructure. He basically sold the floor beneath our feet for scrap and told us it was Christmas.
Reagan's policies doubled the federal revenue over the decade following their implementation because people went back to work knowing they would not be robbed of the majority of the fruits of their labor. Homelessness followed from a liberal move to close the facilities providing long term care to folks suffering from mental illness.

The Laffer Curve strikes again! :lamo You're basically claiming that zero taxation would yield infinite revenue.
Not at all. As you noted a few lines later, "There are optimal tax rates..." and that is the argument Art Laffer makes. I urge you to set aside your blinders and review just what the Laffer Curve is all about.

Kennedy understood that the optimal top rate would be 70%, and even that level was accompanied by Keynesian deficit spending on infrastructure. Ronald Reagan didn't understand anything, he was just an ideologue opposed to progressive taxation who got whatever cuts he could while eviscerating the public sector.
Kennedy understood that the rates needed to be lower, but Johnson spent way more than the Kennedy cuts brought in. Reagan did understand that Keynesian ideas simply don't work. Unfortunately, even though federal revenues doubled over the next decade, Congress spent $1.65 for every new $1 that came in. You repeat the myth that he eviscerated the public sector, but only a liberal would claim that reducing a department's requested increase from 15% to 12% is a "drastic cut."

You certainly don't seem to know anything about President Obama's policies.
I seem to know a great deal more than you do. Good intentions are not sufficient; it is the effect in the real world that counts.

Americans aren't the problem - it's people in this country who consider themselves above America;...
Agreed. We differ on whether the problem folks are those who create wealth (your apparent position) or those who wish to waste the wealth earned by others (my position).

That right-wing rhetoric about "socialism" is ignorant and insane.
Agreed. National Socialism is a much better description. Obama is much closer to Hitler than to Stalin or Mao.
 

ARealConservative

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do we ignore the fraud we committed when the world caught onto the fact that we couldn't honor our promise to back our notes with gold?

do we just pretend that didn't happen and the policies that led up to that were solid?
 

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Troubador said:
That is a nuance worth considering, but is it the case that the brackets were structured in that way?

I don't recall the specific brackets at that time but my strong recollection is that those were the approximate dimensions. The Tax Reform Act of '86, which lowered brackets and did away with the very highest marginal rates, was passed largely on the promise of 'revenue neutrality,' that is, given the same income, there should have been no change in one's tax liability from the last year of the old brackets to the first year of the new brackets. In other words, for the tax-paying population as a whole, the effective tax rate was to remain unchanged.

Edit: IIRC, the top tax rate in '86 was 50%, having been lowered from 70% by Kemp/Roth in (I think) '81. The top marginal rates were in effect starting in WWII ('44 and '45) and again from '51 thru '63, although there was a max effective tax rate of approx 85% for many of those years.
 
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