From the rubric article:
"The Reagan tax cut did have a positive effect on the economy, but the prosperity of the ’80s is overrated in the Republican mind. In fact, aggregate real gross domestic product growth was higher in the ’70s — 37.2 percent vs. 35.9 percent."
Take look at
the 1970s rates that Reagan slashed so that the top tax rate was 28%. The man cut the top tax rate by 42%! It had better have spurred something! And yet it
didn't boost GDP. A key difference, then, between Reagan's cuts and any that will be proposed these days is that tax rates are not going to change nearly as much as they did under Reagan. Now if a 42% tax cut didn't boost real GDP, by what fiction is one supposed to fathom that a few percentage points of rate reduction is going to do any better than a 42% tax cut?
In what range of years between the 1970s and now did we see the biggest "boom" in private investment and growth of new businesses? The 1990s. And
what happened to tax rates in the 1990s? They went up, not a lot, but up they went, and they did that under a Republican at the start of the 1990s. They went up more under Clinton for the remainder of that decade. And make no mistake, people all over the country made money "hand over fist," and under Clinton's management, the government recorded budget surpluses from 1998-2001. I know the 1990s played a huge, irreplaceably so, role in my becoming well off; the same is so for millions like me.
For contextual reference:
Here --
Here’s the US tax rate on your income for every year since 1913 -- and in concert with an inflation calculator and a table listing median income through the years -- one'll find a tool that can be used to identify both the tax rate for both inflation adjusted incomes and nominal incomes for any years between 1913 and 2012. Using that tool, one finds that the only income brackets that have realized any major decrease in their tax rates is the upper income segment of society.
There is also a "slider tool" here --
Top/Bottom Regular Income Tax Rate -- that graphically shows that for low and middle income earners, tax rates have been relatively flat since the late 1960s. In contrast, the history of rates from 1913 onward and applicable to the highest earners (which really is people having a huge range of incomes -- today, for instance, a person with $500K of taxable income is in the highest tax bracket, and in the same bracket is someone with $2M of taxable income; I can assure you, those two groups of people live very different lifestyles) very well mimics a roller coaster's path -- huge hill at the start, a big drop, and then various ups downs with a leveling off at the end.
