Lately, I've been feeling like the people I used to snicker at, who maintained that the 1950s were America's halcyonic heroic heyday, maybe they were on to something. Maybe it's only because our country has begun picking up speed in its downward spiral, making the present feel like the depths of the toilet bowl, the rim where we once were a gleaming symbol of hope. (This presumes you can see past the festering under-rim of racism and sexism--not to mention the war-pocked porcelain matted with scoundrelous profiteering growths.)
But like Jello Biafra said, we've got a bigger problem now. Worse than he imagined, maybe.
Makes me long for the warm comradery of the Eisenhower Era. You know, when Americans who had whupped the Japanese and Hitler, and determined (through our global example of gleaming capitalist prosperity) to keep Joe Stalin from taking over the world.
Also, when Americans who made more than $400,000 per year payed 92% tax; the poorest among these took home $32,000. Mid-way through Ike's first term, more than a third (34.8%) of wage and salary earners belonged to unions, which happens to have been the peak in that metric during the entire history of this country. A guy like me could support his family with a single job. It was as close as we ever came to the socialist worker's paradise.
What happened? If I could blame the Republicans, I would, but the data won't let me. Nor will President Eisenhower's parting words, which warned the nation to beware the military industrial complex and its ruinous effects on our economy and freedoms.
As the chart shows, the top tax rate did drop very slightly during the Eisenhower administration (it had peaked in 1944 at 94%, was 92% when Ike took office, and 91% when he left), but a much bigger drop--to 70%--occurred during the subsequent Kennedy and Johnson regime, although by the end of that there was also a 10% surtax to pay for the Vietnam war. Yeah, that's right, an extra tax; there was a time when wars were not considered normal ongoing activity, and citizens had to pony up some extra cash to pay for them. The other thing that happened during the 1960s was that the threshold for the top tax rate lowered from $400,000 to $200,000, so more people fit in this top bracket.
Then Nixon came in, which by current standards should have meant a huge tax holiday for rich people, but if that happened it was not in the highly visible income tax realm, which stayed the same. When Jimmy Carter stepped into office, the threshold and top rate were still $200,000 and 70%. By the time he left, all that had happened was that inflation had been acknowledged by raising the threshold about 7%.
The Reagan Regime was when the modern GOP agenda of disencumbering the rich and transferring ever more wealth to them truly took hold. Midway through his second term, regression had brought the top bracket down to 50% and increased the income threshold to nearly $360,000, which is so far beyond inflation that it can only be read as a gift to those whose salaries were exorbitant (though perhaps shy of obscene). Two years later, despite being busy selling arms to terrorist regimes that had attacked us, the administration had somehow found a way to reduce the top tax rate to just 28%. But because in this new mean Republicanism it is not enough for the rich to win, but the poor must lose, this top rate applied to anyone making $29,750. There was a "bubble" rate of 33% for income in excess of $71,900, but compared to the 50% of two years prior, it was nothing.
Bush I, true to form, accomplished nothing visible to the naked eye.
And then along cam Bill Clinton. After a dozen years of GOP rule, a chance to set things straight with the allegedly liberal democrats controlling everything. So the rich were once again taxed heavily, right?
Wrong. The "bubble" rate dropped again to 31.5%, and the threshold rose again in 1992, which ostensibly happened under Bush I, although the Democrats controlled Congress at the time and should have been able to hold out, given the political hay they could have had from the administration's criminal culpability in the Iran-Contra morass. Somehow, the Dems snatched economic defeat from the jaws of victory, though, and by the time Clinton had finished his final term, the top tax rate had risen marginally to just under 40%, but far fewer people qualified, since the income threshold had ballooned to nearly $300,000.
Bush II did not monkey around with the rates as much. Not because he was stymied by the compliant Democrats in Congress--it's just that the rich don't earn their money by working at jobs anymore. Decreasing capital gains tax, increasing the threshold on inheritance tax, and of course privatizing government functions so that his corporate buddies could collect money instead of paying, now those were policies W could get behind.
Now, there are increasing demands from us commoners that the rich pay more. Our economy is hurting, and if the government had money to invest, we could recover, create jobs, and fix our ailing public sector. But as it stands, only people who make more than $379,150/year pay the current top rate of 35%, and that's chump change to the richest people in the nation, who pay just 15.3% on the fraction of their investment income that is not sheltered.
So yeah, there is part of me that longs for that workers' paradise of the 1950s. Workers represented by unions, the populace at large benefiting from public works funded in part by the most fortunate among us being asked to help out their fellow citizens. Where is Comrade Eisenhower when we need him?
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