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Yakk · 09-17-2008, 10:22 AM

I've yet to see a "top marginal tax rate vs GDP growth" scatter plot.

I have seen capital gains taxes vs GDP growth scatterplot ... and it sure doesn't say "higher capital gains taxes slow GDP growth".

Also note that the "highest marginal rate" in the OP's graph ... was at over 5 million dollars annually back in 1936. In todays dollars, that is $78,807,913.67. So to hit that, over 20 years, you'd have to realize over 1.5 billion dollars in employment income -- I fully expect, like today, that capital gains and income from investments are easily in utterly different categories that do not pay attention to the same rates as standard income.

If you then follow the "lowering of the top rate", it comes in nearly (not completely) lock-step with lowering the point at which the top rate is hit -- what seems to be going on is a stripping off of nearly-never-realized rates, with nowhere near the same significant change in the actual top marginal rate, over the vast majority of that graph.

In short, the OP seems to be drawing conclusions from that graph that are not remotely supported by the underlying data, and that graph seems to be ridiculously misleading in what it means.

09-17-2008, 10:22 AM	#129 (permalink)
Yakk Wehret Den Anfängen! Location: Ontario, Canada	I've yet to see a "top marginal tax rate vs GDP growth" scatter plot. I have seen capital gains taxes vs GDP growth scatterplot ... and it sure doesn't say "higher capital gains taxes slow GDP growth". Also note that the "highest marginal rate" in the OP's graph ... was at over 5 million dollars annually back in 1936. In todays dollars, that is $78,807,913.67. So to hit that, over 20 years, you'd have to realize over 1.5 billion dollars in employment income -- I fully expect, like today, that capital gains and income from investments are easily in utterly different categories that do not pay attention to the same rates as standard income. If you then follow the "lowering of the top rate", it comes in nearly (not completely) lock-step with lowering the point at which the top rate is hit -- what seems to be going on is a stripping off of nearly-never-realized rates, with nowhere near the same significant change in the actual top marginal rate, over the vast majority of that graph. In short, the OP seems to be drawing conclusions from that graph that are not remotely supported by the underlying data, and that graph seems to be ridiculously misleading in what it means. __________________ Last edited by JHVH : 10-29-4004 BC at 09:00 PM. Reason: Time for a rest.