Explaining tax rates before Reagan to 5th graders: “Imagine if you did chores for your grandma and she gave you $10. When you got home, your parents took $7 from you.” The students said: “That’s not fair!” Even 5th graders get it.— Scott Walker (@ScottWalker) January 15, 2019
This was Walker attempt to riff off of US Rep. Alexandria Ocasio-Cortez's "60 Minutes" interview from last week, where she proposed a 70% income tax rate on people making $10 million or more I talked about it and the 70% income tax level in this post).
AOC got word of what ex-Gov Dropout said, and easily brushed him aside.
Explaining marginal taxes to a far-right former Governor:— Alexandria Ocasio-Cortez (@AOC) January 15, 2019
Imagine if you did chores for abuela & she gave you $10. When you got home, you got to keep it, because it’s only $10.
Then we taxed the billionaire in town because he’s making tons of money underpaying the townspeople. https://t.co/Wcnn2sEgek
This is where I remind you that AOC has two things Scott Walker doesn't.
1. Private sector job experience in the last 26 years.
2. A college degree.
Needy adolescent that he is, Walker kept tweeting, and tried to float this line.
Last time the federal government had a 70% tax rate, Jimmy Carter told the country that we had a crisis in confidence and that we were in a malaise. pic.twitter.com/p2z7fOFaH3— Scott Walker (@ScottWalker) January 15, 2019
Of course, that "crisis of confidence" was because the country had just gone through the disasters of Watergate and Vietnam, and was getting screwed over in an oil crisis caused by actions by OPEC countries. But the job situation under Carter between the end of 1976 and the end of 1979 was very good. The US added 10 million jobs in that 3-year stretch, and the rate of growth in each of those 3 years that was faster than any year we've had since 1999.
In addition, when we had 70%-90% taxes on the rich after World War II, workers received wage growth that matched the productivity they were adding to the economy, unlike the last 40 years when taxes have been cut for the rich.
Going back to AOC’s comments, online publication “The Hill” hooked up with HarrisX to ask people what they thought about what she said, and it turns out a sizable majority of Americans want a high tax rate on the rich.
In the latest The Hill-HarrisX survey — conducted Jan. 12 and 13 after the newly elected congresswoman called for the U.S. to raise its highest tax rate to 70 percent — a sizable majority of registered voters, 59 percent, supports the concept.The poll was specific enough to mention this key fact about Ocasio-Cortez’s plan, that the 70% rate only kicks in on income past $10 million. Which helps to explain why right-wingers like Scott Walker lie and imply it's 70% on ALL income – they’d lose the argument if they told the truth about how the marginal tax rates really work.
Ocasio-Cortez has not introduced any legislation to enact the concept but the survey shows a broad cross-section of Americans supports it, at least presently….
Increasing the highest tax bracket to 70 percent garners a surprising amount of support among Republican voters. In the Hill-HarrisX poll, 45 percent of GOP voters say they favor it while 55 percent are opposed to it.
Independent voters who were contacted backed the tax idea by a 60 to 40 percent margin while Democratic ones favored it, 71 percent to 29 percent.
Meanwhile, how’s that GOP Tax Scam coming along? You know, the one that lowered tax rates for the rich and (especially) corporations, and one that Scott Walker vociferously backed in 2018? Bloomberg’s Stephen Gandel took a look, and it’s even worse than you thought.
First, the headline number: $600 billion, at least. That’s how much more than expected I estimate the companies in the S&P 500 are on pace to save. It is also how much more the tax cut is likely to add to the national debt if it runs as planned for 10 years. The total savings for all of corporate America will be well into the 13 figures.So companies got their taxes cut, and it cosmetically increased their profits and earnings per share, but it didn’t make the average worker any better off. Funny how that happens.
In late 2017, soon before Congress passed the tax cut — which reduced the U.S. corporate rate to a flat 21 percent from a previous marginal rate that topped out at 35 percent — the Joint Committee on Taxation estimated it would cost $1.4 trillion over 10 years. White House officials criticized that estimate as being too high. In fact, it wasn’t nearly high enough. My current estimate, now that companies have completed 2018, is nearly $2 trillion, and that’s just for the S&P 500. That’s nearly $400 billion more than I calculated in May. And the actual bill could rise even more while the lasting benefits are still pretty questionable.
Corporate profits for the S&P 500 companies did rise nearly 24 percent in 2018, the biggest jump since late 2010. About half of that income growth came not from an improvement in operations but from lower corporate tax bills, according to my math. That was also more than previously expected. Analysts had thought the tax cut would represent only a third of 2018 profit growth. But it appears the tax cut was either larger than anticipated, didn’t produce as big an economic boost that many said it would, or more likely a combination of the two.
Meanwhile, the deficit seems likely to jump past its already astronomical level, and that’s before accounting for any recession that might hit in the next 2 years as the inevitable hangover from this unneeded stimulus kicks in.
The more you investigate the tax-related claims of ex-Governor Scott Walker and US Rep. Alexandria Ocasio-Cortez, it's pretty obvious that "socialist" new Congresswoman AOC has a lot more of a clue about what really happens with tax policy than Wisconsin's former Governor. Which goes a long way toward explaining why that lifetime grifter politician is now looking for a new job himself these days.