The Twinkie Economist Looks at the 1950s

In his November 18 New York Times column, "The Twinkie Manifesto," progressive economist Paul Krugman compares and contrasts the 1950s with today: "Yet in the 1950s incomes in the top bracket faced a marginal tax rate of 91, that's right, 91 percent..." Mr. Krugman could have made an even starker comparison, because in 1952 and 1953 the top marginal tax rate was actually 92 percent. To get hit by that rate, one needed a nominal income of just $200,000. For 1953, that's $1,680,746 adjusted for inflation. (That data and that to follow are from Tax Foundation.) Since we're on the subject of top marginal tax rates, let's take a quick look at the high points of that rate since the inception of the income tax in 1913: The top marginal rate for the Individual Income Tax in 1913 was 7 percent; in 1916 it was 15 percent; in 1917, 67 percent; 1918 (77%); 1925 (25%); 1932 (63%); 1936 (79%); 1941 (81%); 1942 (88%); and in 1944 and 1945 the top rate was 94 percent. In 1946 it went down to 91...(Read Full Article)