Some references.
Hi Ben,
[link|http://www.taxplanet.com/library/oldtaxrates/oldtaxrates.html|Here] is a table of US income tax rates from 1913 - 2000.
The highest rate listed is 94% for incomes over $200,000 in 1944-1945.
I can't find comparable data for expansion of the middle-class, but I believe your comment is correct (that the middle-class expanded fastest in the 1950s).
But it's quite a stretch to argue that one follows from the other, or that one occurs with the other, isn't it? (I note that you didn't explicitly do so.)
I think the expansion of the middle class in the 1950s was a result of [link|http://www.nhmccd.edu/contracts/lrc/kc/decade50.html|a great many things]. I don't think that the highest marginal tax rate being 91-92% was one of them. Why? Because I doubt that a great many people paid that top rate and I doubt that a large fraction of the income tax collected was from income in that category. But I'm willing to be proved wrong. :-)
[link|http://library.thinkquest.org/17126/chapter/23.html|This] page about Eisenhower's presidency says:
The Other America
In 1962, 42.5 million Americans (1 of 4) were poor. These families earned less than $4,000 for a family of four or $2,000 for a single person. 1/4 were over age 65. 1/3 were under the age of 18. 1/5 were people of color (1/2 of all the blacks and native americans). 2/3 lived in households headed by a person with an 8th grade education or less. 1/4 lived in households headed by women.
One might expect that if the middle class did well in the 1950s that some of those benefits would have been shared by the poor as well. But that doesn't seem to have been the case by the end of the period.
If you have some links arguing that the expansion of middle class in the 1950s was strongly correlated with high marginal tax rates, I'd like to see them.
Thanks. :-)
Cheers,
Scott.
