Please you need to read better. This is progressive marginal tax talk topping at 80%. Success is a word we interpret according to your definitions. I see that to you Europe is s##hole, I se countries like Germany, France, Switzerland, Finland and Sweden way different. I think we can learn many of the things they do right. But right is also a political point of view. The book tax rate in the US is one of the highest while the real tax rate in the US is one of the lowest in the world; thanks to the many loopholes and bailouts. However, corporate tax is not my worry, personal income is. And I think a much higher rate like the one we used to have before Reagan would be healthy to US ALL. Well data shows that over the past 4 decades many countries have grown better than the US with much higher taxes. Donât forget the US does not have the highest standard of living in the world. Donât forget among 15 of the best cities to live in NONE IS AMERICAN.
They are not without problems and excesses like we are. The euro currency was a great idea poorly developed. Our models hardly works as well.
I dont think capitalism is the isue here. There are many types of capitalism and many systems and economic order. In fact we have a system closer to corporatism.
I donât think high tax rates alone stabilize or destabilize the economy. I think the US as we know it today would be impossible had taxes not been as high as they were between 1940 and 1980. Real tax rates were never cut. President reagan was the first to substitute them with high levels of debt; Something real painful to the whole country and economy. I think for the kind of society we have today we need higher taxes on those who can pay more. And going back to the old tables could do us some real good.
Messi007, Hee hee hee, I am laughing at my English in my response to you. Your English is at least as good as mine, it appears. Supposedly English is my native tongue.
WSJ: Tax Revenues = 19% of GDP, Regardless of Tax Rates Weekend Wall Street Journal op-ed, There's No Escaping Hauser's Law, by W. Kurt Hauser (Stanford University, Hoover Institution): Tax revenues as a share of GDP have averaged just under 19%, whether tax rates are cut or raised. Better to cut rates and get 19% of a larger pie. Even amoebas learn by trial and error, but some economists and politicians do not. The Obama administration's budget projections claim that raising taxes on the top 2% of taxpayers, those individuals earning more than $200,000 and couples earning $250,000 or more, will increase revenues to the U.S. Treasury. The empirical evidence suggests otherwise. None of the personal income tax or capital gains tax increases enacted in the post-World War II period has raised the projected tax revenues. Over the past six decades, tax revenues as a percentage of GDP have averaged just under 19% regardless of the top marginal personal income tax rate. The top marginal rate has been as high as 92% (1952-53) and as low as 28% (1988-90). This observation was first reported in an op-ed I wrote for this newspaper in March 1993. A wit later dubbed this "Hauser's Law." Over this period there have been more than 30 major changes in the tax code including personal income tax rates, corporate tax rates, capital gains taxes, dividend taxes, investment tax credits, depreciation schedules, Social Security taxes, and the number of tax brackets among others. Yet during this period, federal government tax collections as a share of GDP have moved within a narrow band of just under 19% of GDP. Why? Higher taxes discourage the "animal spirits" of entrepreneurship. When tax rates are raised, taxpayers are encouraged to shift, hide and underreport income. Taxpayers divert their effort from pro-growth productive investments to seeking tax shelters, tax havens and tax exempt investments. This behavior tends to dampen economic growth and job creation. Lower taxes increase the incentives to work, produce, save and invest, thereby encouraging capital formation and jobs. Taxpayers have less incentive to shelter and shift income. http://taxprof.typepad.com/taxprof_blog/2010/11/wsj-hausers-law.html I'll let the experts prove you wrong.
"Tax changes have very large effects: an exogenous tax increase of 1 percent of GDP lowers real GDP by roughly 2 to 3 percent." How do changes in the level of taxation affect the level of economic activity? The simple correlation between taxation and economic activity shows that, on average, when economic activity rises more rapidly, tax revenues also are rising more rapidly. But this correlation almost surely does not reflect a positive effect of tax increases on output. Rather, under our tax system, any positive shock to output raises tax revenues by increasing income. http://www.nber.org/digest/mar08/w13264.html
The Effect of Marginal Tax Rates on GDP Growth (Sorry, you'll have to read the whole article to get the point). ...... In order to find out, we crunched the numbers. We went to the Bureau of Economic Analysis website and looked up GDP growth for every year since 1930. Then we went to the Internal Revenue Service website and pulled up the top marginal tax rate for those years. We then averaged the annual GDP growth rate for various tax levels. This is a very cursory examination of the numbers, but if the contention of those pushing for the Bush tax cuts to be retained is true, then we should see some correlation between the growth of the economy and tax rates. We didn't. In fact, if you use history as your guide, then we should set the top marginal rate at 88 percent. Why 88 percent? Because during the time that this was the top marginal rate, the GDP expanded at a rate that even countries like China and Brazil would envy -- 17.5 percent. And we need to make sure that we set it at 88 percent, not 86.45 percent. Setting the tax rate at that level historically provided us with GDP contraction of 5.9 percent. ..... Ideologues who read this will naturally jump and say that we are calling for an increase of the top marginal rate to 88 percent. Hardly. What we are saying is that an examination of the historical record of the past 80 years shows no correlation between the top marginal rate and economic growth. There is a big difference between the two statements, and if an ideologue wants to pretend there isn't, they're being disingenuous. http://buyandholdplus.com/blog/2010/09/the-effect-of-marginal-tax-rates-on-gdp-growth.html