# Taxes on the rich under President Eisenhower **URL:** \ **Category:** Great Debates\ **Created:** [September 17, 2012, 11:14pm UTC](https://boards.straightdope.com/t/taxes-on-the-rich-under-president-eisenhower/635020 "2012-09-17T23:14:05Z")\ **Posts on this page:** 20\ **Page:** 4
**Author:** ![adaher](https://avatars.discourse-cdn.com/v4/letter/a/dec6dc/32.png) [@adaher](https://boards.straightdope.com/u/adaher)\ **Post date:** [September 19, 2012, 2:04pm UTC](https://boards.straightdope.com/t/taxes-on-the-rich-under-president-eisenhower/635020/61 "2012-09-19T14:04:13Z")
> [@Jas09](#): > > OK, let’s do the math. > > Cut by 50%: > Transportation: $40b > HUD: $21b > Homeland Sec: $30b > Ag: $65b > Interior: (ETA) Read it wrong - this saves $10b > > Eliminate: > Education: ~$90b (a lot of ARRA funding went here so it’s unclear what future savings will be) > Energy: $24b (although quite a bit of this simply has to be spent unless you’re just going to leave nuclear energy and bombs unmananged) > Commerce: $10b > Labor: $10b > > Medicare savings: The most recent numbers I could find indicate that of the 65+ cohort, those in the 65-70 bracket spend about 18% of that. So let’s say you’re cutting Medicare by 18%. That’s about $97 billion in savings (using 2010 numbers). > > Total saved: ~$397 billion. Congratulations, you’re almost halfway to eliminating the deficit. What else would you like to cut? Can we talk about revenue yet? That’s year 1. The 1.5% spending growth from that new lower base balances the budget fairly quickly. 7-8 years by my admittedly poor “math in my head” skills. ---
**Author:** ![adaher](https://avatars.discourse-cdn.com/v4/letter/a/dec6dc/32.png) [@adaher](https://boards.straightdope.com/u/adaher)\ **Post date:** [September 19, 2012, 2:07pm UTC](https://boards.straightdope.com/t/taxes-on-the-rich-under-president-eisenhower/635020/62 "2012-09-19T14:07:01Z")
> [@Jas09](#): > > Sign me up. 🙂 > > You might want to phase the tax increases and spending caps in to avoid a huge recession rather than a minor one, but in the end it’s probably the best course if we can’t get a better compromise plan. > > But the end result is exactly right - you cannot get there with spending cuts alone. Revenue must get back up to historical norms, through both growth and tax increases. Well, revenue is at 15%, it has to get back to 18%. Spending has to come down from 24% to 18%. The recession by all accounts should be over for the most part. We could make a deal for one more big stimulus shot to get Democrats on board and then have everything phase in in 2014. ---
**Author:** ![TriPolar](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/tripolar/32/3008_2.png) [@TriPolar](https://boards.straightdope.com/u/TriPolar)\ **Post date:** [September 19, 2012, 2:20pm UTC](https://boards.straightdope.com/t/taxes-on-the-rich-under-president-eisenhower/635020/63 "2012-09-19T14:20:47Z")
Only growth will get us out of this mess. None of these cockeyed ideas about taxes or spending will make a bit of difference unless it leads to growth, and there’s no evidence that growth is directly related to general percentages of spending or taxation. ---
**Author:** ![adaher](https://avatars.discourse-cdn.com/v4/letter/a/dec6dc/32.png) [@adaher](https://boards.straightdope.com/u/adaher)\ **Post date:** [September 19, 2012, 2:23pm UTC](https://boards.straightdope.com/t/taxes-on-the-rich-under-president-eisenhower/635020/64 "2012-09-19T14:23:40Z")
True. However, there is also no fool proof way to get growth. We can control spending and revenue, we can’t control growth. However, the history of spending-based austerity has shown that over the long term it does help a country’s economic growth to have a solid fiscal situation. Countries with high levels of debt are constantly in trouble. ---
**Author:** ![Damuri\_Ajashi](https://avatars.discourse-cdn.com/v4/letter/d/898d66/32.png) [@Damuri\_Ajashi](https://boards.straightdope.com/u/Damuri_Ajashi)\ **Post date:** [September 19, 2012, 3:40pm UTC](https://boards.straightdope.com/t/taxes-on-the-rich-under-president-eisenhower/635020/65 "2012-09-19T15:40:05Z")
> [@moonshot925](#): > > Uh, this has nothing to do with WW2. > > I am talking about how President Eisenhower balanced the budget while cutting taxes. Are you proposing we go back to Eisenhower era effective tax rates because I think you’d get a lot of support for that in the socialist party. > [@moonshot925](#): > > The federal government takes in $2.469 trillion in revenue and spends $3.796 trillion. > > That means 35% of what the government spends needs to be borrowed. > > We need to cut spending. The biggest source of our deficit is the recession. It lowers tax revenues and increases spending on things like food stamps and unemployment. anyone that pretends taht this is a structural deficit is trying to push an agenda. In order to get back in line to historical norms we have at least as much to do on the revenue side as the spending side (once the spending effects of the recession have receded). > [@moonshot925](#): > > I would cut the budgets of the departments of transportation, housing and urban development, homeland security, agriculture and interior by 50%. > > Eliminate the departments of education, energy, commerce and labor. > > Increase the Medicare eligibility age to 70. > > Cap the growth of federal spending to 1.5% per year. That doesn’t even get you half way there. So you would get rid of airport security, border security, immigration services, national parks, federally guarnateed student loans, nuclear weapons, nuclear power plants, and a slew of other shit I can’t name off the top of my head right now. > [@adaher](#): > > Well, revenue is at 15%, it has to get back to 18%. Spending has to come down from 24% to 18%. > > The recession by all accounts should be over for the most part. We could make a deal for one more big stimulus shot to get Democrats on board and then have everything phase in in 2014. Spending will shrink and revenues will increase if we can get our economy back on track. It might not get us the whole way there but we have at least as much work to do on the revenue side as we do on teh spending side and MOST of the work on teh spending side is entitlements for baby boomers. > [@TriPolar](#): > > Only growth will get us out of this mess. None of these cockeyed ideas about taxes or spending will make a bit of difference unless it leads to growth, and there’s no evidence that growth is directly related to general percentages of spending or taxation. What about the Great Depression? Are people starting to buy the notion that Keynesian economics doesn’t work? Its not like we only have one data point. The Great Depression was a GLOBAL phenomenon and different countries used different measures to try tog et out of it. The countries that employed targetted stimulus generally did much better than the countries that pursued austerity. > [@adaher](#): > > True. However, there is also no fool proof way to get growth. We can control spending and revenue, we can’t control growth. > > However, the history of spending-based austerity has shown that over the long term it does help a country’s economic growth to have a solid fiscal situation. Countries with high levels of debt are constantly in trouble. And we have a history of austerity during recession leading to worse outcomes than stimulus during recessions. The trick is to switch to austerity when times are good (see George Bush and teh bush tax cuts). ---
**Author:** ![TriPolar](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/tripolar/32/3008_2.png) [@TriPolar](https://boards.straightdope.com/u/TriPolar)\ **Post date:** [September 19, 2012, 3:47pm UTC](https://boards.straightdope.com/t/taxes-on-the-rich-under-president-eisenhower/635020/66 "2012-09-19T15:47:40Z")
> [@Damuri\_Ajashi](#): > > What about the Great Depression? Are people starting to buy the notion that Keynesian economics doesn’t work? Its not like we only have one data point. The Great Depression was a GLOBAL phenomenon and different countries used different measures to try tog et out of it. The countries that employed targetted stimulus generally did much better than the countries that pursued austerity. General rates. The idea that there is some magic number for tax rates or spending as a percentage of GDP that creates growth. ---
**Author:** ![denquixote](https://avatars.discourse-cdn.com/v4/letter/d/b9bd4f/32.png) [@denquixote](https://boards.straightdope.com/u/denquixote)\ **Post date:** [September 19, 2012, 4:42pm UTC](https://boards.straightdope.com/t/taxes-on-the-rich-under-president-eisenhower/635020/67 "2012-09-19T16:42:25Z")
> [@moonshot925](#): > > The point is that the rich didn’t pay anything close to 91% which liberals claim they did. I know of no liberal who claimed that any rich person paid 91% of his income in tax. Perhaps you could cite one. ---
**Author:** ![John\_Mace](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/john_mace/32/185_2.png) [@John\_Mace](https://boards.straightdope.com/u/John_Mace)\ **Post date:** [September 19, 2012, 5:38pm UTC](https://boards.straightdope.com/t/taxes-on-the-rich-under-president-eisenhower/635020/68 "2012-09-19T17:38:13Z")
> [@moonshot925](#): > > Why would Obama need to propose raising taxes? Why can’t the federal government live within its means? President Eisenhower with the 83rd Congress cut spending and taxes. We should do the same now. You are missing the whole point. Forget about Obama. This is about your characterization of a 22% difference in tax rates as “slight”. If any president, be he Obama or Bush or Eisenhower, proposed a 22% tax increase, would you balk at the press calling it a “slight” increase? I think you would, which is why I think your earlier post calling the difference in rates only slight is bunk. ---
**Author:** ![moonshot925](https://avatars.discourse-cdn.com/v4/letter/m/f0a364/32.png) [@moonshot925](https://boards.straightdope.com/u/moonshot925)\ **Post date:** [September 20, 2012, 2:28am UTC](https://boards.straightdope.com/t/taxes-on-the-rich-under-president-eisenhower/635020/69 "2012-09-20T02:28:12Z")
> [@Damuri\_Ajashi](#): > > That doesn’t even get you half way there. > > So you would get rid of > airport security, > border security, > immigration services, > national parks, > federally guarnateed student loans, > nuclear weapons, > nuclear power plants, > and a slew of other shit I can’t name off the top of my head right now. How would I get rid of airport security, border security and immigration services? The DHS would still exist but it would have a smaller budget. The national parks can be privatized. Yes I would get rid of federally guarnateed student loans. Everything related to nuclear weapons can be transferred to the DOD. The Nuclear Regulatory Commission can still exist independently. ---
**Author:** ![Lobohan](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/lobohan/32/79_2.png) [@Lobohan](https://boards.straightdope.com/u/Lobohan)\ **Post date:** [September 20, 2012, 2:48am UTC](https://boards.straightdope.com/t/taxes-on-the-rich-under-president-eisenhower/635020/70 "2012-09-20T02:48:23Z")
> [@moonshot925](#): > > How would I get rid of airport security, border security and immigration services? The DHS would still exist but it would have a smaller budget. > > The national parks can be privatized. > > Yes I would get rid of federally guarnateed student loans. > > Everything related to nuclear weapons can be transferred to the DOD. > > The Nuclear Regulatory Commission can still exist independently. Has anyone told you that your ideas aren’t very good? Handwaving the effects of absurd cuts that are made without considering those effects isn’t bold policy initiative. ---
**Author:** ![Fiddle\_Peghead](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/fiddle_peghead/32/3506_2.png) [@Fiddle\_Peghead](https://boards.straightdope.com/u/Fiddle_Peghead)\ **Post date:** [September 20, 2012, 3:01am UTC](https://boards.straightdope.com/t/taxes-on-the-rich-under-president-eisenhower/635020/71 "2012-09-20T03:01:23Z")
> [@moonshot925](#): > > The point is that the rich didn’t pay anything close to 91% which liberals claim they did. Maybe the “liberals” claimed that the top marginal rate was 91%, and not that the rich paid that much. I honestly don’t know. Do you have any cites for what you claim liberals said? ---
**Author:** ![moonshot925](https://avatars.discourse-cdn.com/v4/letter/m/f0a364/32.png) [@moonshot925](https://boards.straightdope.com/u/moonshot925)\ **Post date:** [September 20, 2012, 4:54am UTC](https://boards.straightdope.com/t/taxes-on-the-rich-under-president-eisenhower/635020/72 "2012-09-20T04:54:33Z")
> [@Lobohan](#): > > Has anyone told you that your ideas aren’t very good? > > Handwaving the effects of absurd cuts that are made without considering those effects isn’t bold policy initiative. Spending 50% more than you take in is not a good idea. ---
**Author:** ![fumster](https://avatars.discourse-cdn.com/v4/letter/f/e9c0ed/32.png) [@fumster](https://boards.straightdope.com/u/fumster)\ **Post date:** [September 20, 2012, 5:29am UTC](https://boards.straightdope.com/t/taxes-on-the-rich-under-president-eisenhower/635020/73 "2012-09-20T05:29:08Z")
> [@moonshot925](#): > > Spending 50% more than you take in is not a good idea. Nor is earning 50% less than you spend. ---
**Author:** ![fumster](https://avatars.discourse-cdn.com/v4/letter/f/e9c0ed/32.png) [@fumster](https://boards.straightdope.com/u/fumster)\ **Post date:** [September 20, 2012, 5:35am UTC](https://boards.straightdope.com/t/taxes-on-the-rich-under-president-eisenhower/635020/74 "2012-09-20T05:35:29Z")
> [@moonshot925](#): > > Uh, this has nothing to do with WW2. > > I am talking about how President Eisenhower balanced the budget while cutting taxes. It has everything to do with the end of WWII, when do you think Eisenhower was in office? Of course he cut spending, the war was over. Of course he cut taxes, they were raised because there was a war on. Only a moron would cut taxes with a war (or two) going on. When he cut taxes after the war they were still higher than when they were after Bush cut them with two wars going on. Is this really the best example you can think of to advance your weak cause? ---
**Author:** ![moonshot925](https://avatars.discourse-cdn.com/v4/letter/m/f0a364/32.png) [@moonshot925](https://boards.straightdope.com/u/moonshot925)\ **Post date:** [September 20, 2012, 10:43am UTC](https://boards.straightdope.com/t/taxes-on-the-rich-under-president-eisenhower/635020/75 "2012-09-20T10:43:44Z")
> [@fumster](#): > > It has everything to do with the end of WWII, when do you think Eisenhower was in office? Of course he cut spending, the war was over. Of course he cut taxes, they were raised because there was a war on. Only a moron would cut taxes with a war (or two) going on. When he cut taxes after the war they were still higher than when they were after Bush cut them with two wars going on. > > Is this really the best example you can think of to advance your weak cause? Check your dates. The tax cuts and spending cuts after WW2 were made from 1945-1948 under Truman. Years before Eisenhower took office on 20 January 1953. ---
**Author:** ![TriPolar](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/tripolar/32/3008_2.png) [@TriPolar](https://boards.straightdope.com/u/TriPolar)\ **Post date:** [September 20, 2012, 1:30pm UTC](https://boards.straightdope.com/t/taxes-on-the-rich-under-president-eisenhower/635020/76 "2012-09-20T13:30:44Z")
> [@moonshot925](#): > > Check your dates. The tax cuts and spending cuts after WW2 were made from 1945-1948 under Truman. Years before Eisenhower took office on 20 January 1953. More proof that your ideas are worthless. Tax cuts and spending cuts didn’t take care of the war debt or boost the economy. You constantly propose steps that have proven useless. ---
**Author:** ![Damuri\_Ajashi](https://avatars.discourse-cdn.com/v4/letter/d/898d66/32.png) [@Damuri\_Ajashi](https://boards.straightdope.com/u/Damuri_Ajashi)\ **Post date:** [September 20, 2012, 3:15pm UTC](https://boards.straightdope.com/t/taxes-on-the-rich-under-president-eisenhower/635020/77 "2012-09-20T15:15:12Z")
> [@TriPolar](#): > > General rates. The idea that there is some magic number for tax rates or spending as a percentage of GDP that creates growth. No there is no magic number but deficit spending accelerates economic activity and promotes growth, you can target that spending well or poorly but Keynesian economics still works so there is in fact some combination of taxes and spending that will promote growth. Moonshot seems to believe that balancing the budget is the most important thing and damn the consequences of trying to balance the budget during a recession. Of course if Republicans take the reins during a mild recession, they engage in MASSIVE deficits but noone utters a peep. > [@moonshot925](#): > > How would I get rid of airport security, border security and immigration services? The DHS would still exist but it would have a smaller budget. > > The national parks can be privatized. > > Yes I would get rid of federally guarnateed student loans. > > Everything related to nuclear weapons can be transferred to the DOD. > > The Nuclear Regulatory Commission can still exist independently. You’re right, you jsut wanted to reduce DHS. Not elimiante it. So which part of it would you reduce? Sell the national parks? To who? The timber and resource companies, and let them strip mine them for resources? Disneyland so that we can start paying admission to see the Grand Canyon, Mount Rushmore and Old Faithful? Never mind the effect that would have on our ranchers who depend on grazing in our national parks. Why in the world would anyone think its a good idea to get rid fo teh student loan program? If you’re just going to move most of what the Department of Energy does to other departments then why bother getting rid of the department? Why not just cut the programs you don’t like (whatever that may be)? BTW, there are some good reasons to take the control and regulation of nuclear weapons out of the hands of the military. > [@moonshot925](#): > > Spending 50% more than you take in is not a good idea. So maybe we should take in some more and cut some spending. Noone but you seems to think this is a structural deficit. > [@John\_Mace](#): > > You are missing the whole point. Forget about Obama. This is about your characterization of a 22% difference in tax rates as “slight”. If any president, be he Obama or Bush or Eisenhower, proposed a 22% tax increase, would you balk at the press calling it a “slight” increase? I think you would, which is why I think your earlier post calling the difference in rates only slight is bunk. AND its a lot more than 22%. ---
**Author:** ![moonshot925](https://avatars.discourse-cdn.com/v4/letter/m/f0a364/32.png) [@moonshot925](https://boards.straightdope.com/u/moonshot925)\ **Post date:** [September 21, 2012, 1:17am UTC](https://boards.straightdope.com/t/taxes-on-the-rich-under-president-eisenhower/635020/78 "2012-09-21T01:17:43Z")
> [@TriPolar](#): > > More proof that your ideas are worthless. Tax cuts and spending cuts didn’t take care of the war debt or boost the economy. You constantly propose steps that have proven useless. Yes they did. In FY 1945 the federal government spent $92.712 billion and in FY 1948 it spent $29.764 billion. That is a 68% reduction. Page 21, Table 1.1 [http://www.whitehouse.gov/sites/default/files/omb/budget/fy2013/assets/hist.pdf](http://www.whitehouse.gov/sites/default/files/omb/budget/fy2013/assets/hist.pdf) Private sector investment, employment and growth surged in 1946, 1947, 1948 and the economy boomed. [http://www.colorado.edu/ibs/eb/alston/econ8534/SectionXII/Higgs,\_From\_Central\_Planning\_to\_the\_Market\_The\_American\_Transition,\_1945-1947.pdf](http://www.colorado.edu/ibs/eb/alston/econ8534/SectionXII/Higgs,_From_Central_Planning_to_the_Market_The_American_Transition,_1945-1947.pdf) ---
**Author:** ![Jas09](https://avatars.discourse-cdn.com/v4/letter/j/d07c76/32.png) [@Jas09](https://boards.straightdope.com/u/Jas09)\ **Post date:** [September 21, 2012, 1:59am UTC](https://boards.straightdope.com/t/taxes-on-the-rich-under-president-eisenhower/635020/79 "2012-09-21T01:59:21Z")
> [@moonshot925](#): > > In FY 1945 the federal government spent $92.712 billion and in FY 1948 it spent $29.764 billion. That is a 68% reduction. What percent of that reduction was defense? Would you support a similar cut in defense spending today? Here, I’ll do it for you: 1945 - $82,965m 1948 - $9,105m. A reduction of $73.86b compared to your overall reduction of $62.95b. That is to say that non-defense spending actually went UP after the war… ETA2: Cite: [UsGovernmentSpending.com: World War II US Defense Spending](http://usgovernmentspending.blogspot.com/2009/03/world-war-ii-us-defense-spending.html) ---
**Author:** ![moonshot925](https://avatars.discourse-cdn.com/v4/letter/m/f0a364/32.png) [@moonshot925](https://boards.straightdope.com/u/moonshot925)\ **Post date:** [September 21, 2012, 2:20am UTC](https://boards.straightdope.com/t/taxes-on-the-rich-under-president-eisenhower/635020/80 "2012-09-21T02:20:21Z")
> [@Jas09](#): > > What percent of that reduction was defense? Would you support a similar cut in defense spending today? > > Here, I’ll do it for you: 1945 - $82,965m 1948 - $9,105m. A reduction of $73.86b compared to your overall reduction of $62.95b. That is to say that non-defense spending actually went UP after the war… > > ETA2: Cite: [UsGovernmentSpending.com: World War II US Defense Spending](http://usgovernmentspending.blogspot.com/2009/03/world-war-ii-us-defense-spending.html) Defense spending is still government spending. I would not support a large cut today because defense defense spending is actually very low as a percent of GDP. [Previous page](https://boards.straightdope.com/t/taxes-on-the-rich-under-president-eisenhower/635020.md?page=3) [Next page](https://boards.straightdope.com/t/taxes-on-the-rich-under-president-eisenhower/635020.md?page=5)