Max, don't know why you are getting nasty about this, but...
I wrote:
> If we assume that all he had control of was actual government regulations,
> meaning in this case the tax code, what the 1993 tax bill is responsible
> for is making sure that a large chunk of that wealth going to the wealthy
> from the boom was taxed back for public use."
> Using "but for" analysis of the effects of tax cuts or hikes is hardly
> radical. It is exactly what Citizens for Tax Justice and other
> liberal groups did in the 1980s in assessing the responsibility of the
> 1981 tax cuts for the deficit back then."
Max replied
> Yeah but that's not what you've done. You
> have no counter-factual. everything that's
> happened since 1992 is Clinton's doing,
> evidently, except little things like the
> '97 tax act.
The '97 tax act mostly effected capital gains, which was the point of the original discussion over capital gains versus income tax revenues in effecting the surplus.
I've agreed that the strong economy has made a big difference, but only held out for the point that the 1993 tax bill made sure that more of the growth going to the wealthy was taxed and contributed to the surplus.
You act as if I am some kind of raving loony for this position, but it is exactly the position of Citizens for Tax Justice. In a report they did in 1988 specifically noting the role of income tax revenues versus capital gains, they argued:
CTJ: "The surge in tax revenues that began in 1993 has been driven both by the strong economy and by the upper-income tax increases that were enacted and took effect in 1993...The 1993 tax legislation has raised more revenue than anticipated because of growth in the number and income of the affluent (and notwithstanding the significant tax cuts enacted in 1993 for low- and moderate-income working families)."
The richest 1% pay roughly $300 billion per year in federal income taxes. Without the 1993 tax bill, their rate would be 31% rather than 41%, or 25% less. Of course, translating top rates into effective rates is not exact, but any reasonable percentage of $300 billion is a "large" amount of money per year in my view.
So why the rancor when I am not saying anything different from CTJ on the basic facts and the numbers supporting my position seem pretty reasonable. I even made a guesstimate of $60 billion per year from increased taxes from the top 1%- a conservative estimate that did not even include the increased taxes from the wealthy hit by the 1993 bill other than the top 1%.
-- Nathan Newman