Let’s Tax the Rich

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tags: taxes, Economy, Trump

Dr. Lawrence Wittner (http://www.lawrenceswittner.com) is Professor of History emeritus at SUNY/Albany and the author ofConfronting the Bomb (Stanford University Press).

Whatever happened to the notion that rich people should pay their fair share of the cost for their country’s public programs?

Progressive income taxes―designed to fund government services and facilities—go back centuries, and are based on the idea that taxes should be levied most heavily on people with the ability to pay them. In the United States, the federal government introduced its first income tax in 1861, to cover the costs of the Civil War. Although new federal income tax legislation in the 1890s was ruled unconstitutional by the U.S. Supreme Court, the resulting public controversy led, in 1913, to passage of the sixteenth amendment to the Constitution, firmly establishing the legality of an income tax.

The progressive income tax―levied, at its inception, only on the wealthiest Americans―was a key demand and political success of the Populist and Progressive reformers of the late nineteenth and early twentieth centuries. As might be expected, most of the wealthy regarded it with intense hostility, especially as the substantial costs of World War I sent their tax rates soaring. The development of jobs programs and other public services during the New Deal, capped by the vast costs of World War II and the early Cold War, meant that, by the 1950s, although most Americans paid income taxes at a modest rate, the official tax rate for Americans with the highest incomes stood at about 91 percent. 

Of course, the richest Americans didn’t actually pay at that rate, thanks to a variety of deductions, loopholes, and its application to only the highest increment of their income. Even so, like many of the wealthy throughout history, they deeply resented paying a portion of their income to benefit other people―people whom they often regarded as inferior to themselves. Consequently, cutting taxes for the rich became one of their top political priorities.

Facing a strong backlash from the wealthiest Americans, their corporations, and conservative politicians, the federal government began a retreat. In 1964, the top marginal tax rate was reduced to 70 percent, in 1982 to 50 percent, and, in 1988, to 28 percent. Although it was raised somewhat during the Clinton presidency, it was reduced again during the reign of George W. Bush.



Actually, they didn’t. A Gallup poll of April 2017 found that 63 percent of Americans believed that upper income people paid too little in taxes. That same month, the Pew Research Center reported that 60 percent of Americans were bothered “a lot” by the fact that “some wealthy people don’t pay their fair share” of taxes. In October 2017, a Reuters/Ipsos poll discovered that three-quarters of Americans thought that the wealthiest Americans should pay more in taxes. Furthermore, surveys taken at the time by U.S. polling agencies consistently found that public support for the regressive Trump-GOP tax legislation languished in the mid-20s.


Conversely, nearly half of all American households cannot afford the basics of existence like food, housing, and medical care. Why should they be taxed heavily―or at all―to fund public facilities and services that the richest Americans, with their unprecedented wealth, can easily afford to cover?




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