Quote:
Originally Posted by raymr
The affluent middle class we all knew and loved and grew up with was an anomaly. It was largely made possible by aggressive taxation on wealth (top rate was 90+% back in the 1960s) and lack of international competition. As we all know, those factors have changed permanently. People who expect to get ahead doing what their middle class parents did will be very disappointed.
Still the basic rule of capitalism applies: Find a need and fill it. Folks will just have to be more creative and resourceful in order to find success.
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The 90% top rate argument is largely a canard, while the top marginal rate was indeed 90% the existence of loopholes (closed by the way by Ronald Regan in the 1986 TEFRA act) ensured that virtually nobody actually paid the 90% rate. Here's a table that shows the effective rates paid over the years and while the trends are down a bit the rates are basically unchanged over the last 40+ years.
http://www.taxpolicycenter.org/taxfacts/displayafact.cfm?Docid=456
I know people like to believe otherwise but the percentages of taxes paid by rich and poor taxpayers have remained relatively stable over the years.
I agree with your observations about increased global competition being a significant factor, we need to recognize this and take steps to make american businesses more competitive in the global marketplace.