Thursday, December 02, 2010

It's still the spending stupid


Veronique de Rugy on taxes..........

This chart by Mercatus Center Senior Research Fellow Veronique de Rugy shows the historical path of federal taxation as a percentage of GDP using the earliest records available from the Office of Management and Budget and top marginal tax rate data from the Tax Policy Center. From 1930 to 2010, tax revenue collection in the United States has never topped 20.9%, averaging 16.5% of GDP over these 80 years. This comes despite the drastic historical fluctuation in the rate of taxes on the wealthiest Americans. As we move toward debt reduction, it is critical to keep the long-term path of the United States in mind.

It's the spending stupid.....

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1 comment:

Anonymous said...

That is an amazing graphic. The hidden stat here is that given the relatively constant percent of GDP, the only reliable way to increase tax revenues is to grow the GDP.

When I talk to my liberal friends I make the point that if you want to increase taxes that a corporation pays, don't change the law, just encourage higher profits.

For some reason, even with their college masters degree, this concept is viewed by them as an incomprehensible blizzard of numbers.

Then again it's pretty well established that libs want the tax code to be punitive at the expense of being socially effective.