The Tax That Turned Reagan From a Labor-Loving FDR Dem to the Father of Backlash Conservatism
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Actor Ronnie Reagan had won. Never again would a B-movie star have to stew about lost windfalls. Unfortunately, never again -- in our modern age -- would America have an effective check on the accumulation of grand private fortunes.
In the middle decades of the 20th century, the steeply graduated progressive income tax that actor Ronald Reagan so detested operated marvelously well as just that sort of check. America’s super rich -- our top tenth of 1 percent -- saw their share of the nation’s income drop precipitously in those years, from nearly 12 percent before the Great Depression to under 3 percent by the 1970s.
The top 0.1 percent share in 2007, right before the Great Recession? Over 12 percent. The rich, in other words, have come all the way back -- and more.
And average Americans? After enjoying historic levels of middle-class prosperity in the tax-the-rich mid-20th century, they’ve been treading water ever since.
And Carole Lombard, the Hollywood star who welcomed the high taxes on high incomes that Ronald Reagan so abhorred, whatever happened to her?
Lombard died in a tragic January 1942 plane crash, on her way back to Hollywood from a war bond rally in her native Indiana. She never had a chance, in all the subsequent tax-the-rich political battles, to stare Ronnie Reagan down. Too bad. Now that might have really changed history.
Sam Pizzigati is the editor of the online weekly Too Much, and an associate fellow at the Institute for Policy Studies.