“I contend that for a nation to try to tax itself into prosperity is like a man standing in a bucket and trying to lift himself up by the handle.”
― Winston S. Churchill
House Democrats are treading carefully when it comes to talk of a 70 percent marginal tax rate on income above $10 million, an idea floated by freshman Rep. Alexandria Ocasio-Cortez.
Many Democrats are supportive of the freshman phenom’s call for higher taxes on the rich, but even some progressives are stopping short of endorsing that high a marginal rate.
Rep. Pramila Jayapal (D-Wash.), a co-chairwoman of the Congressional Progressive Caucus, said she thinks “the fact that people are not paying their fair share is a problem and the millionaires and billionaires are the ones where that has to rest.”
Rep. Raúl Grijalva (D-Ariz.), a leader of the progressive caucus in the last Congress, said that while it’s important to make sure that “everybody’s carrying their load,” he didn’t know if 70 percent “would be the right number or not.”
House Budget Committee Chairman John Yarmuth (D-Ky.) said he wasn’t sure about a specific top rate but said that Ocasio-Cortez is “not off-base.”
Ocasio-Cortez floated the idea as a way to help pay for a “Green New Deal,” a proposal aimed at taking action on climate change.
More broadly, the new lawmaker has argued that a progressive tax system with higher taxes on the wealthy is well worth considering as the country looks for ways to pay for initiatives on health care and other safety-net issues.
She also made the argument that such high rates are hardly unprecedented.
“You look at our tax rates back in the ’60s and when you have a progressive tax rate system your tax rate, you know, let’s say, from zero to $75,000 maybe 10 percent or 15 percent, et cetera. But once you get to, like, the tippy-tops — on your 10 millionth dollar — sometimes you see tax rates as high as 60 or 70 percent,” Ocasio-Cortez said.
She noted that a high marginal rate wouldn’t hit most Americans, and that it would also only take a fair portion of a wealthy person’s income. A 70 percent marginal rate on income of $10 million would be effective only on a person’s income above $10 million.
“That doesn’t mean all $10 million are taxed at an extremely high rate, but it means that as you climb up this ladder you should be contributing more,” she said in a recent “60 Minutes” interview.
Ocasio-Cortez spokesman Corbin Trent told The Hill that the congresswoman’s remarks on the show were “more conceptual” than a specific proposal for a 70 percent marginal rate.
The top marginal tax rate in the United States was above 90 percent in much of the 1950s and early 1960s, and the rate was 70 percent as recently as 1980.That year, the 70-percent rate applied to income over $215,400 for married couples.
During Ronald Reagan’s presidency, the top rate was first cut to 50 percent and then lowered again to 28 percent.
In the last 25 years, the top rate has been in the mid-to-high 30s, with tax law lowering the top rate from 39.6 percent to 37 percent. In 2019, the 37-percent rate applies to income over $612,350 for a married couple filing jointly.
Ocasio-Cortez’s call for a 70 percent marginal tax rate does have the support of another freshman progressive lawmaker: Rep. Ayanna Pressley (D-Mass.), who said she could potentially see herself introducing or sponsoring legislation down the line.
“I think we have a decisive mandate from this electorate, this 116th Congressional class to be bold. I think every creative solution needs to be on the table,” Pressley told The Hill. “And from a values based perspective to tax those, you know, who earn $10 million a year, I think it’s exactly what we should be doing.”
Pressley said while she and most members are currently focused on the partial government shutdown, she looks forward to continuing having a dialogue with like-minded members as they consider crafting policy.
Now folks, I am no expert on the economy. I am just an old history professor who has a talent for remembering events and significant people of the past.
Well when I heard about this 70% tax proposal I thought about an individual you may all find interesting.
His name is William John Henry Boetcker.
He was born in Hamburg, Germany on July 17, 1873. At the age of 8, his father, a foreman in a factory, was carried home on a stretcher, disabled for life when he was beaten by striking workers.
When he was about 14, Boetcker started a book. Despite his father’s assertion that he was crazy, he worked hard and finished it at age 16. It was called Neuester Rätzelschatz and was a collection of puzzles and mind problems.
A newspaper described him as Germany’s youngest author, and this drew the attention of the Countess Von Waldersee, an American born woman, who believed that Boetcker would have to go to America to make something of himself.
She thought he would never amount to anything in Germany. At age 18, after he finished high school, she gave Boetcker $65 to go to America.
Boetcker took the steam ship Augusta Victoria to America. It was a stormy crossing, and when it arrived in New York 30 days late, they learned that they had been presumed lost at sea.
Boetcker proceeded to Chicago, Illinois, where he attended the Chicago Theological Seminary. He spoke no English, and the professors spoke no German, so they conversed in Latin.
In 1893 the World’s Fair came to Chicago. The Pope had sent a Cardinal to represent the church, but a member of the Cardinal’s Special Bodyguard had taken ill.
An ad was placed seeking men six feet tall with military training who could play the cornet.
Boetcker had been a Reserve Lieutenant in the German Army, and he knew how to play cornet, so he answered the ad despite being less than the required height. Nobody else responded, and he got the job.
While at the Exposition, Boetcker rode the Ferris wheel, which was the first to have been built. He was fond of telling how he got stuck at the top of the wheel, and played “Nearer My God to Thee” on his cornet. So it can’t be said he had no sense of humor.
Boetcker disagreed with some of the Chicago Theleological Seminary’s principles, and moved to the Bloomfield Seminary in New Jersey to complete his studies for the ministry.
Upon graduation, the Reverend Boetcker was ordained in Brooklyn, New York.
He quickly gained attention as an outspoken opponent of organized labor (remember his dad?) and was instrumental in the founding of the Citizens Industrial Association, later making a professional career of public speaking.
He is sometimes considered the forerunner of current “success coaches” like Steven Covey, Joel Osteen, and Tony Robbins.
An outspoken political conservative, Rev. Boetcker is best remembered for writing a pamphlet called The Ten Cannots, published in 1916.
The pamphlet emphasizes freedom and responsibility of the individual on himself. It is often misattributed to Abraham Lincoln.
The error apparently stems from a leaflet printed in 1942 by a conservative political organization called the Committee for Constitutional Government.
The leaflet bore the title “Lincoln on Limitations” and contained some genuine Lincoln quotations on one side and the “Ten Cannots” on the other, with the attributions switched.
The mistake of crediting Lincoln for “The Ten Cannots” has been repeated, many times, but the words belong to Reverend Boetcker.
There are several variations of the pamphlet in circulation, but the most commonly accepted version is as follows:
- You cannot bring about prosperity by discouraging thrift.
- You cannot strengthen the weak by weakening the strong.
- You cannot help little men by tearing down big men.
- You cannot lift the wage earner by pulling down the wage payer.
- You cannot help the poor by destroying the rich.
- You cannot establish sound security on borrowed money.
- You cannot further the brotherhood of man by inciting class hatred.
- You cannot keep out of trouble by spending more than you earn.
- You cannot build character and courage by destroying men’s initiative and independence.
- And you cannot help men permanently by doing for them what they can and should do for themselves.
Reverend Boetcker also spoke of the “Seven National Crimes”.
- I don’t think.
- I don’t know.
- I don’t care.
- I am too busy.
- I leave well enough alone.
- I have no time to read and find out.
- I am not interested.
Sound familiar folks?
It should. In the past we have talked extensively about socialism.
Now you can call it whatever you want. Socialism, Communism, Progressivism. Liberalism, it doesn’t matter.
What Rep. Alexandria Ocasio-Cortez is trying to sell us is the same thing!
All of these programs are economic and political structures that promote equality and seek to eliminate social classes.
In theory they sound good, with everyone doing their share and working together to provide for the greater good.
Each uses a government mandated plan to ensure the needs of all community members are met.
Production from the community is distributed based upon need, not by effort or amount of work.
It is expected that basic needs for each person are met by the community, and there is no more to be obtained through working more than what is required.
For example, if a worker puts in more time at work, he sees no additional reward.
Therefore, this type of economy often results in poor production, mass poverty and little advancement. This occurred in the 1980s to the Soviet Union when poverty became so widespread, and rebellions and revolutions caused that nation to collapse.
Each worker is provided with necessities so he is able to produce without worry for his basic needs. Still, advancement and production are limited because there is no incentive to achieve more.
Without motivation to succeed, such as the ability to own an income-producing business, workers’ human instincts tell them to do the minimum. There are no rewards for working harder than your neighbor.
In capitalism, reward comes naturally without limitation to workers who work harder than their neighbor.
When there is profit, the owner can freely keep it, and he has no obligations to share his spoils with anyone else.
A capitalist environment facilitates competition, and the result is unlimited advancement opportunity.
In modern society, many countries have adopted pieces of socialism into their economic and political policies.
For example, in the United Kingdom, markets are allowed to fluctuate rather freely, and workers have unlimited earning potential based on their work. However, basic needs like healthcare are provided to everyone regardless of time or effort in their work.
The welfare programs like food stamps and federal housing in the United States are also forms of socialist policies that fit into an otherwise capitalist society.
The government then bureaucratically rations out—as they see fit—the means of human survival. In the end, you’ve basically got an elite corps of mobsters with the power to decide which folks are more equal than others.
That guy should pay 70% in taxes and these poor people should pay nothing and receive benefits paid for by that guy.
These programs also have a way of producing bloated bureaucracies that in turn produce ever greater poverty. Along the way, this produces even more corruption and cronyism.
Anyone out there think our current federal government is running efficiently?
As these initiatives progress, censorship becomes the norm because dissent cannot be tolerated or the system would collapse.
I think we all agree with Reverend Boetcker’s “Cannots”. (You cannot help the poor by destroying the rich)
However, my greatest fear today lies in his Seven National Crimes:
- I don’t think.
- I don’t know.
- I don’t care.
- I am too busy.
- I leave well enough alone.
- I have no time to read and find out.
- I am not interested.
Ask yourself. Are you guilty of any of these crimes? If so, what can we do to fix it?