New Mises Article: Real Tax Rates in the 60s Were Much Lower than Ocasio-Cortez Thinks

My new article for Mises.org is out, which is actually a reworked version of this older article that was also published on Mises. This one takes the newly elected congresswoman Alexandria Ocasio-Cortez (whom both the Left and Right seem to be obsessed with) to task for her absurd plan to tax the rich at 70 percent in order to get America's carbon footprint down to zero in 12 years...

Wait what? Seriously? Why did I spend my time to critique this nonsense?

Anyways, as I note, while the tax rates in history have been much higher (as high as 91 percent), the amount collected as a percentage of GDP has pretty much always been the same since the early 1950's. As I note,

Regardless, one should ask how much the rich were actually paying. It should be noteworthy that back in the 1950s, the government wasn’t actually collecting any more in tax revenue as a percentage of GDP. There’s something called Hauser’s Law, which basically states there is a maximum threshold on how much the government can tax out of its population. I believe this “law” is no such thing. If the government really wanted to expropriate more, it could do so. But Hauser’s Law is based on the fact that in pretty much every year since 1950, the government has collected between 16 and 20 percent of GDP in taxes. Here are the government tax receipts compared to the top marginal tax rate:

The reason there has been such a discrepancy between the tax rate and the amount collected boils down to the differences in the where the top marginal tax rate kicked in as well as a myriad of deductions that used to exist, but no longer do. 

I go into much more of the history and explanation in the article, so check it out!