Literally they did.
In 1944, the top rate peaked at 94 percent on taxable income over $200,000 ($2.5 million in today’s dollars3). That’s a high tax rate.
Over the next three decades, the top federal income tax rate remained high, never dipping below 70 percent.
https://bradfordtaxinstitute.com/Free_Resources/Federal-Inco...
Note the parent said "marginal" tax rate.
> During that period the government captured ~17-18% of GDP in taxes which is the post war average.
Even if the 17~18% of GDP is true (not saying it isn't, just dont have time to verify), it's very likely the highest tax bracket had way fewer people than it does today, so it would be equivalent of taxing earners of $100M/year in today's world. Weighing against GDP total negates increases in spending by the government to provide services that spur economies / provide benefits / etc. Point is - this figure is irrelevant and doesn't normalize the discussion.
As an aside, the US seems like a very weird place to me. There are homeless people everywhere. I have never seen so many homeless people anywhere in my life...even in developing countries. It is crazy. I don't understand how people tolerate that. Not only poor people but the US seems to be a country which breeds a total lack of empathy, I don't understand how wealthy people tolerate it...and then you read the hyperbolic comment elsewhere on this thread about a founder saying this is theft, this well end Silicon Valley, it is insanity, it is intolerable...try tolerating sleeping in a tent under a bridge.
Either way, the reason you tax the $100m is so you don't end up with a govt that will take more than your money. The notion that you can just take forever has never been a part of politics.
As an aside, I think most Americans perception of authoritarian govts is that they are anti-democratic in this way...but if you look at monarchies, there was always responsibility from the wealthy, there was always a safety valve...the US has no safety valve, there is no social responsibility from the wealthy, they have taken everything and are asking where the rest is (and sound utterly deranged when you suggest they should make $5m rather than $10m). There are things much worse than taxation, you have to live in the world with other people.
EDIT: I will add...I would kind of quibble with the notion that markets are free in the US. The amount of state support for capitalists since 2008 (not talking about TARP which was necessary) has been very significant. Free money for the wealthy, usurious interest and rent for the poor. In particular, the level of downward social mobility in the US is very low for a capitalist economy. Markets are free in the US...in one sense.
“Bread and circuses” is derogatory, but the unsustainable parts of technological industrial society aren’t “rich people exist”. Conditions are so ridiculously prosperous and powerful for everyone that the new injustices are stuff like “my life expectancy is 70 instead of 80” and “I can’t afford to pay for debt I took”. What’s unsustainable?
There are plenty of homeless, but there’s also lots of jobs. They may absolutely fucking suck, but in terms of buying power you’re not gonna die and can live quite materially well vs rural.
On the other hand, if you're making $100 MM a year through corporations, then it's the corporation that the market values, not you personally; and corporations (and equities in them) are state-intermediated fictions.
Corporations have no natural existence, or natural rights. They exist because governments say they do, they have cap tables because governments say they do, and they pay out dividends and have transferrable equity because governments say they do. They are government-drafted incentive structures to motivate productive labor, just like tax credits or mining rights or intellectual property are incentive structures to motivate productive labor.
Or, to put that another way: corporations are de-facto nationalized; by default, the government is the actual direct creator of every corporation that exists in the country. When the person who asked the government for a corporate registration, receives 100% equity in the resulting corporation, that's a transfer of that equity from its original holder at time of creation, the government. The government isn't obligated to do that. It just does it because that's what makes people excited to work hard building corporations.
Sure governments help enforce the terms of the contract and even set some ground-rules on what is/isn't allowed but the entire thing is built on mutual trust that everyone involved will follow the agreed-upon rules.
History has not been kind to nations whose governments break those rules and started nationalizing corporations. Not too long ago, North Korea was the side with the industry, railroads, hydro-elec dams, steel mills and manufacturing plants.
Clearly it's a spectrum. Property rights are certainly the purview of governments to set & adjudicate the rules within their jurisdiction, as granted by their unique powers (nominally) conferred by the people.
> History has not been kind to nations whose governments break those rules and started nationalizing corporations
Yeah but history has been kind to companies who mold laws for and heavily intervene in them
Securities are valuable assets for the same reason that greenbacks have value: because the state is standing there ensuring everyone's playing a fair game. If the state didn't punish counterfeiting, greenbacks would be worthless. If the state didn't punish non-dilutive duplicate share sales (i.e. selling the same whole pie to two people), securities would be worthless.
As such, the state is creating the worth of those things, from nothing. Your effort into a corporation is additive, but the government's pre-invested effort into building the framework on which corporations rest is multiplicative, with the multiplier having started off, before that effort, at 0. Neither fiat money nor securities work in a lawless world. The government—that is, the People—get all the credit for making those things possible. Should they thus not get the reward? (Commodities do work in a lawless world, but not through tokens representing them. You'd have to bring those 10K bushels of wheat along with you if you want any credibility, which is pretty inefficient.)
Let me put it this way: if we were starting with a form of socialism where corporations exist, and have founders and executives and boards of directors, but no shareholders, with the government instead earning all corporate profits (which it then spends on things like UBI); and then someone proposed a capitalist class that would earn some of those profits instead, taking them directly out of the UBI budget... would that proposal be justifiable through any particular argument to natural rights/freedoms? There might be a practical argument, in terms of a profit motive incentivizing entrepreneurship and investment, leading to a "rising tide"; but would there be an ethical argument in favor?
> History has not been kind to nations whose governments break those rules and started nationalizing corporations. Not too long ago, North Korea was the side with the industry, railroads, hydro-elec dams, steel mills and manufacturing plants.
North Korea isn't a particularly good example; their economic stall is a result of trade embargoes more than anything. (They're actually doing as well as could be expected, given that they're an isolated, non-globalized economy whose only trading partners are much larger globalized economies [China, Russia] who don't need anything NK could provide.)
Meanwhile, China's own mostly-nationalized corporations do pretty well for themselves.
Hell, even Canada has tons of Crown Corporations, and everyone here is begging our federal government to nationalize the cellular infrastructure (and then lease it out fairly) because it'd be much better than the current oligopoly situation we're in.
It's interesting that your idea of a free society is forcing businesses to organize in a certain way. Doesn't sound very free.
You're reading that in to what I said. Look again.
"We could, for example, alternatively have a free society where most firms are collectively owned and managed by their workers."
I do not in any way advocate for the use of force to achieve this, and you have assumed I did. Tho I did not mention it, my philosophy is explicitly voluntary. I argue that it makes economic sense for workers to organize in this way, and that they should do it for their own benefit.
> You're free to create a firm collectively owned and managed by workers right now, nothing is stopping you.
Yes you are right I can. That's what makes this plan great! It is voluntary and doable today. However what I want to achieve is not just one more co-op. I want to live in a society where all of the goods I depend on are mined, manufactured, and delivered by cooperatively run firms. To achieve that level of change I have to go on the internet and talk to nerds about why it's so great for all of us to do this thing. So that's what I'm here to do. You may have misunderstood my comment as a complaint that I want the government to fix my problems for me, but again that is a misunderstanding of my position.
EDIT: I am doing things in the real world to achieve these goals too (see my profile), I only make the point about talking about it online because I tire of the “go do it then no one is stopping you” line. I am on HN to discuss theory with theory nerds.
That is, do you take issue with the fact that one person, employing many, profits much more than the people he employees or that he profits much more than his fellow man on the street?
The question of the self employed person making huge profits is another one. I advocate for a somewhat selfless mindset (beyond meeting basic needs for your well being and happiness). So if a single individual can make huge profits, that means it's costing the customers a lot of money. In my mind, a person making a lot of profit could save a lot of people money if they shared how they are solving these problems, and recruited others to help with the effort. So that might look like: make their project open source and help others join in the effort to make their solution more accessible. I see this as best for society.
What then of the food and shelter this entrepreneur requires? As long as food and shelter are hard to come by, the entrepreneur will be incentivized to withhold their solution from society and keep charging high prices to ensure they meet their own needs.
The solution I see is for society to provide for the needs of all. This can happen by ensuring that food and shelter are abundant. If we do that, we can see more developers and entrepreneurs willing to share what they know for the benefit of all. I believe that if executed well, this strategy can lead to a better and more innovative society than one in which every person is incentivized to withhold their knowledge from others.
Going back to your original question - it's not that I take issue with a single business owner earning a high profit, it's that I think we can do better. Instead of a few earning high profits while others freeze to death on the street, we can provide food and shelter to all, eliminate material poverty, and do this all while innovating faster. But to do so, we must drop the self-centered individualist mindset and think about how to both look after ourselves while also looking after others. We must think as a community instead of atomized individuals.
Anyway let's say you have a society where all the firms are worker self directed. It makes sense for firms to form broader organizations that represent different interests. So for example lets say you have an industrial zone on the edge of a geographic region. There's a shipping port, some bridges, electrical infrastructure, etc. All the firms in the area depend on this infrastructure to operate. And because they share this common interest, they have formed a regional cooperative made up of delegates from each firm in the region. When they need to make a decision about when to perform major infrastructure work, it is decided at one of their regular meetings. The delegates are not their to make their own decisions but to bring with them decisions made at their firm's meeting on the matter. If the delegate agrees to something their firm's people actually do not like, their people can recall them.
So the regional cooperative holds a regular meeting and there they decide they are going to build a bigger bridge and then decommission the old one. All the firms in this regional cooperative keep their money at a credit union which was set up specifically to represent these firms. They need to rustle up $500m to pay for this. They discuss how to raise the funds. There is a particularly big firm that will benefit substantially from the new bridge. They put up $50m on the condition that the bridge will have tolls and they will expect to be paid back $30m over 30 years. The rest of the firms together put in another $50m. The industrial zone regional cooperative takes their $100m to the broader regional cooperative which represents a large geographic region including several major cities which benefit from the industrial zone. The broader cooperative agrees to stake the other $400m for the bridge improvements with the agreement that the industrial zone regional cooperative will pay it back over 40 years.
So yeah. That's generally how you manage that. You can look up Murray Bookchin, David Harvey, and Richard Wolff if you want to know more. Also look up Zoe Baker on youtube.
If you don't like my made up scenario, maybe look up how ITER or LHC get their funding.
https://en.wikipedia.org/wiki/ITER#Funding
https://en.wikipedia.org/wiki/Large_Hadron_Collider#Cost
EDIT: Of course ITER and LHC are not workers cooperatives, just examples of how people delegating funds could make decisions.
In that school, students learn to work together not just to solve problems, but also to determine justice (under guidance from adult teachers).
In a world with bosses and workers, we are teaching everyone to do as they are told and follow orders. But we could, I believe, see a much better world if we teach everyone to be community leaders and collaborators.
We create market conditions. It isn't some uncontrollable god we all have to live with.
Free in what sense? Are you implying the US is a free market?
