In an astounding, little-reported act of hubris, Senate Republicans apparently killed a study by the non-partisan Congressional Research Service when its findings contradicted their favorite economic myth: that giving tax cuts to the rich helps anyone but themselves.
The reports conclusion.
The top income tax rates have changed considerably since the end of World War II. Throughout the late-1940s and 1950s, the top marginal tax rate was typically above 90%; today it is 35%. Additionally, the top capital gains tax rate was 25% in the 1950s and 1960s, 35% in the 1970s; today it is 15%. The average tax rate faced by the top 0.01% of taxpayers was above 40% until the mid-1980s; today it is below 25%. Tax rates affecting taxpayers at the top of the income distribution are currently at their lowest levels since the end of the second World War. TL;DR Tax cuts don't make jobs, they make the rich richer.
The results of the analysis suggest that changes over the past 65 years in the top marginal tax rate and the top capital gains tax rate do not appear correlated with economic growth. The reduction in the top tax rates appears to be uncorrelated with saving, investment, and productivity growth. The top tax rates appear to have little or no relation to the size of the economic pie.
However, the top tax rate reductions appear to be associated with the increasing concentration of income at the top of the income distribution. As measured by IRS data, the share of income accruing to the top 0.1% of U.S. families increased from 4.2% in 1945 to 12.3% by 2007 before falling to 9.2% due to the 2007-2009 recession. At the same time, the average tax rate paid by the top 0.1% fell from over 50% in 1945 to about 25% in 2009. Tax policy could have a relation to how the economic pie is sliced—lower top tax rates may be associated with greater income disparities.
From the article - "Republicans did not say whether they had asked the research service, a nonpartisan arm of the Library of Congress, to take the report out of circulation, but they were clear that they protested its tone and findings. "
Seems like Republicans didn't have real objective concerns.
Doesn't take in to account the lag of economic policy, they say? Interesting that 11 years of Bush tax cuts isn't enough time, but 3.5 years of an Obama presidency and we're lucky we're not all dead yet. /s
The notion that helping the wealthy to remain rich encourages economic growth is more than a century old: in the mid-1800s Trickle-Down Theory was known as Horse-and-Sparrow Theory, because if you feed the horses enough some will pass through to feed the sparrows...
The trickle-down myth is an old and thoroughly bankrupt idea. The real question is, why do conservatives continue to cling to this fantasy? Why do extreme conservatives live in an anti-intellectual bubble, immune to facts and invulnerable to reason?
the reason why conservatives continue to be drawn to such failed policies is simple: selfishness is the defining principle of the conservative worldview. We all act in our own self-interest, but conservatives and liberals view self-interest very differently. Liberals include other people in their self-interest calculus because they believe the fate of others is inextricably linked to their own wellbeing. Conservatives, by contrast, have a narrow conception of self-interest that excludes other people from consideration – especially those who are very different from themselves. The common term we use to describe a person who does not factor others into his or her own interests is selfish.
Conservatives want to believe that trickle-down policies will work because it justifies selfish behavior: it claims that in a dog-eat-dog system the dogs that come out on top will somehow turn around and elevate everyone else. This is so patently false that anyone who actually learned the value of sharing in kindergarten can instantly see through the ruse.
Note also that conservatives prioritize what they want to believe over what facts and evidence tell them is true - and this explains why anti-intellectualism is another symptom of conservative selfishness.
from "Letter to a Conservative Nation". There are pdf excerpts about the trickle-down myth and anti-intellectualism here.