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There’s a weird and unnatural sclerosis to the way the modern liberal views the world. As though the circus of human affairs were a quiescent control group and federal policy a precise, scalpel-like scientific variable. If we can only tune things just right!
Of course it does not work that way. I spent all of Saturday morning and afternoon paying taxes, which prompted me to pull some data. Let’s chart the top marginal tax rate — the rate very successful people pay on their last slice of income — against the actual total federal income tax receipts as a percentage of the economy.
Top Bracket Rate versus Individual Tax Receipts as a Percent of GDP
We can tax the rich 1%, 91%, or anything in between. 1% will free the economy and spark superior capital allocation and new invention. 91% will cripple our prospects for new medicine, new technology, and new ways to enjoy life. But no matter what the President does, he’s only collecting 8% of GDP on April 15. His decision is whether or not he wants that figure — the GDP — to grow. So: does he?