The point at which the U.S. did the most technological research and had the most productive corporations was when the tax rates were highest. The reason you had Bell Labs in the 50s was they had a 90% tax rate on the highest brackets of income, and they had a 60%, I can't remember what it was, corporate tax rate. It was very high.
At a certain rate of profits, you're not going to keep it anyway, so people would say, "Okay, we'll give higher wages to our workers, make them happy. Why not give it to them instead of the government?" They'd say, "We'll invest in research, because you can write that off." There was a massive amount of internal research, and also just general improvement of productivity, because it paid to invest in that if you ended up having to give it in taxes anyway. The more that taxes go down, the more they just take that money and put it in financial stuff instead, basically trapping other people in debt, extracting rents of one kind or another. Lowering the tax rate is just going to cause them to invest even less in productivity and more in predatory activities.
I wonder about the role of being au courant or fashionable...
When taxes were high, what was the fashion amongst the 1%? What did they did they want to show off and compete amongst themselves? The wellbeing/wages of their workers? The innovative products/ideas they funded? Today, taxes are low and the 1% seemingly compete to cheat their workers of more and more of their wages/labor so they can claim to have made more profits. Just contrast the views of high tax George Romney, father, to those of low tax Mitt Romney, son.
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