The most prosperous decade of the 20th century was the 1950s.
The top tier tax rate in 1950 was 84%, and that was the lowest it would be until 1964. The rest of the 1950s were at 91%-92%.
The important thing to remember is that nobody ever paid the top-tier tax rate. Instead, they spent their income. When they found themselves $10,000 over the line in 1955, and about to pay $9100 to Uncle Sam, they said “Hold up. Let’s spend $10000 on something useful and deduct it as a business expense”.
That spending turned into paychecks for the workers who produced the purchased item.
$10,000 over the line in 1988 meant they got to put $7,200 into their stock portfolio, send $2,800 to Uncle Sam, and the worker is laid off because they had no incentive to actually spend their excess income.
The most prosperous decade of the 20th century was the 1950s.
The top tier tax rate in 1950 was 84%, and that was the lowest it would be until 1964. The rest of the 1950s were at 91%-92%.
The important thing to remember is that nobody ever paid the top-tier tax rate. Instead, they spent their income. When they found themselves $10,000 over the line in 1955, and about to pay $9100 to Uncle Sam, they said “Hold up. Let’s spend $10000 on something useful and deduct it as a business expense”.
That spending turned into paychecks for the workers who produced the purchased item.
$10,000 over the line in 1988 meant they got to put $7,200 into their stock portfolio, send $2,800 to Uncle Sam, and the worker is laid off because they had no incentive to actually spend their excess income.