Herbert Hoover and the largest tax increase in American History

People in the media are freaking out over the recent increase in tariffs imposded by Trump to stop some of the massive inequities in international trade. You hear the next great depression more than a few times - all bunk, of course.

If found this well written and cogent look at 'then' and 'now' re taxes and import duties...


Source
(progressingamerica: Herbert Hoover and the largest tax increase in American History)

I like how the constant harping and carping about tariffs these days gets invoked together with fearmongering about Smoot Hawley and the Great Depression. What is missing? The Revenue Act of 1932. After the 1929 crash there was a small tax cut, but this was overshadowed by Smoot Hawley just months later. In the middle of bad economic times, you simply don't raise taxes, and yes, a tariff is a tax. But let's get to the meat of the numbers, shall we?

The Revenue Acts of 1918 and 1921 had a top tax rate of 73%.

The Revenue Act of 1924 reduced this to a top tax rate of 46%.

The Revenue Act of 1926 reduced this again to a top tax rate of 25%.

It was not raised from this number until The Revenue Act of 1932, which had a top tax rate of 63%. This was lower than the ninteen-teens tax rates of 73%, but considering the jump of 25% to 63%, this is over a 100% increase and it indeed was at the time the largest peacetime tax increase in American history.

But that is not what we received in 2017. For all its flaws, the 2017 Tax Cuts and Jobs Act does a reverse-Hoover by lowering taxes. I can explain; there is a certain formula here:

1929: poor economy, raising tariffs, largest tax increase in American history. (From what I can tell, they were not lowering burdensome regulations in 1929 either)

2017/2018: decent economy, raising tariffs, lowering taxes as well as lowering regulation.

See the stark differences here? Most of the time we hear that these tariffs should not exist and they will only lead to trade wars and other issues. But in reality it is the 16th amendment which should be repealed. The only thing they get correct when talking about this issue is that a mixture of income taxes and tariffs is a deadly combo. They should not be mixed. But it isn't the tariffs which should be eliminated, it is the income tax which should die a horrible and bloody death.

The Founding Fathers used tariffs as the only (or at least main) form of taxation, and that is probably the most proper way of taxation. The irony of tariffs is that they are in general taxes only on the rich - the problem is that it does not grant the kind of authoritarian domestic controls that income taxes bring, which is really what the progressives love and seek.

Even with taxes, the issue is not actually the issue. For progressives, control is the issue and control is always the real issue. (Emphasis added Ed) Everything else is merely window dressing. It's always been about control and it has been this way going back to 1906 when income taxes were first proposed by the president in his SOTU that year. It's all about control.

 

Super informative It's too bad you cannot get this information into the liberals hands and even if you did they wouldn't read it. the old saying, " don't confuse me with the facts" stands out I have watched numerous reporters try to engage them in real conversation and with facts it's like talking to a dog about long division, once you reach the threshold of their ability to comprehend they fall apart and get all threatening and frustrated and screaming one liner comebacks. It is sad to see that our educational system has destroyed critical thinking analytical viewing and bothering to listen to the vocabulary, words are important, Many times I have heard something from a politician and had to rewind and listen to it over and over to figure out they actually said nothing or were sneaky and tried to pull one over.
The completely sad part is that the average person knows all the football teams all the main players who the draft picks are and, winners of the voice and all the other unreality shows. I think it's getting better I just hope we can hang in there another 6 years with a majority.

 

The tariffs are short term pain for the long term gain.

 

• My idiot liberal neighbors are screaming that Trump is destroying the environment, preventing the proper redistribution of wealth, doing away with free medical care, limiting welfare, keeping out the poor immigrants and refugees, preventing a carbon tax and creating global warming, etc. Just wish it were legal to vote more than once for the man in any state but California, whose ideas I agree with, sometimes wish he were just a little smoother, but New Hampshire has some very smooth liberals in congress who are doing their best to create the "progressive" world. Guess I will take Trump, warts and all.

 

I believe Trump is the best thing to happen for our country in a very long time,tell me if I’m wrong.

 

Yes, the best thing in a very long time. And, yes, there are warts there, as noted by Duane, but finally we have a President that truly is trying to accomplish something for the country and its people, not just for the elites and/or the power corporations. Will it last? No, it will not. The forces against real change are too strong and too heavily embedded and defended. However, if even a few of the major problems are addressed with real solutions, not just political lip service or band-aids, then we will all be better for it.

Frankly, in the last few years, I have come to horrible conclusion that nothing can truly fix this nation besides a total and complete revolution. No president can undo the mess we have...perhaps a dictator, like Napoleon after the French revolution, but it cannot be done democratically.

 

Full disclosure, I am not a Trump fan and I think he is doing the right thing with tax cuts in income tax and increase in tariffs. It will make things we import more expensive to the point of maybe, just maybe it's economical to actually manufacture in USA again.

 

"I think he is doing the right thing with tax cuts in income tax and increase in tariffs. It will make things we import more expensive to the point of maybe, just maybe it's economical to actually manufacture in USA again."

I hope so. Economics is a 'Black Art' to me and I hope better brains than mind have this figured out. I don't think enough was done with the tax cuts. I thought that was a joke as a couple of hundred dollars either way doesn't improve one's life. However, eliminating money spent on illegal aliens and other reforms could have a huge financial, trickle down, effect if I understand correctly. I hope they will also chop to the bone things like Foreign Aid. How we can give money away to other countries when we have to borrow money ourselves to pay the debt - well - I don't understand that portion of economics. Of course, no one will get close to any sort of resolution concerning Medical Care in this country...no one is that powerful.

 

If more rich people created new jobs ,
whom do you think they will hire ? the lazy unwilling to work?
What would be the purpose of having a business that makes no profit ?
How would a business like that compete with the real world ?

 

AMazing how willing people get to work when they are hungry and have no choice but to work or hunt

 

US business is going to have to pay to attack labor...
(Do ‘common welfare programs’ pay the equivalent of a $20.83-per-hour job?)

The Rhode Island total comes from starting with the $6,648 a year in cash welfare that a single parent with two children could receive, which is the only unrestricted cash that recipients would see. (It's also 34 percent less than what recipients got in 1995, adjusted for inflation, according to Cato.)

Then you add in $6,249 per year in food stamps (now called the SNAP program), $12,702 in housing subsidies, $11,302 as the cost of buying health care coverage comparable to Medicaid, $275 in heating assistance, $300 a year under the Emergency Food Assistance program (TEFAP), and $1,156 in food under the Women, Infants, and Children (WIC) program for pregnant women, new mothers and children up to age 5.

The total -- $38,632 -- is equivalent to what a single parent with two children would get to keep after taxes if the parent earned $43,330 a year, or $20.83 an hour for a 40-hour work week, Cato said.

"Many welfare recipients, even those receiving the highest level of benefits, are doing everything they can to find employment and leave the welfare system," the Cato report concludes. "Still, it is undeniable that for many recipients -- especially long-term dependents -- welfare pays more than the type of entry-level job that a typical welfare recipient can expect to find. As long as this is true, many recipients are likely to choose welfare over work."

It isn't just you that sees this...

 

Problem is that a good portion of the herd can no longer "work" in any real job. They can not read, write, reliably show up for work, have problems with child care, children's medical and social care, drug or alcohol problems, mental health problems,have a chip on their shoulders and will not take directions or criticism, do not interact well with customers, have no physical skills, want a 30 min break every hour, want to be "treated with respect" but call you an idiot, have a prison record and wonder why you do not really trust them and hesitate to send them to a job site alone, expect $15 an hour and full benefits when they start and ignore the fact that during training they accomplish nothing and you only get half as much done as you are showing and explaining what you are doing. In the trades and repair world, much of which requires you to work on your own and use your mind to figure out how to solve the problems as they occur, they arrive from our educational system without the ability to do so and reguard your attempts to train them to do so as demeaning and it is no longer "safe" to be with a female or a member of another racial group without an observer.
If you do hire an individual directly, not thru a temp agency, you have to file social security, income tax, unemployment and such forms, if they do not work out, you may have problems dismissing them, may well be sued, and it will increase your unemployment rates. If you do offer medical insurance and a 401k plan, it is hard to explain to them that while they are taking home $500 a week, they cost you $800 or 900 a week.
Many small companies just don't bother anymore, either use a temp agency, guarantees you untrained workers who come and go, or hire contract workers. Many of those not in the labor force are absent for a very good reason, no employer can ever cover the cost of hiring them and still stay in business..

 

Before I retired I worked as a Public Works Director in the town were I live. The welfare agency sent me a young black woman to work in the public works dept. When I came in she was setting on the floor by the front door with her legs crossed. She said she was not going to work for $10.00 an hour when she could be on welfare,so I called the agency and they came and picked her up. Back she went on welfare with full benefits. Folks something is wrong here. Shtf targets is what I call them. They were raised by their parents to work the system,but I’m afraid that time is about over.
There are going to be a lot of crying ,screaming and hungry people. They want what the hard working people have without working for it. Just because you have a Mercedes you worked and saved for, they think they are intitled to one also.

 

There are those, however, that try to get ahead and better his or her position in life. Case in point. Last week the local TV news showed a young man (ten, maybe twelve) mowing lawns. When asked what he did with his earnings, his reply was that he banked them to buy newer, better equipment. He wants to have his own lawn care business when he gets out of school. This is something learned from example. School doesn't teach it. School teaches that to be a success you must get a degree and go into debt up to your elbows. I wish this young man to best for his future.