Under Obama Taxes Reach Lowest Level Since Truman

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If you re-read Schlesinger’s post, he is not talking about income tax as a percentage of income earned; he is talking about income tax as a percentage of GDP. GDP is the market value of goods and services produced in the US. Let me give a very, very oversimplified example:
You have 3 people working in manufacturing earning $20 per hour each. They are producing $50 worth of product per hour. Their income tax rate is 25%.Thier combined total hourly earnings are $60 per hour, their total income tax paid is 25% of $60 or $15, and their GDP produced per hour is $150. So the income tax per GDP percentage is $15/$150 or 10%. One is laid off. Now the earning for the two remaining people is $40 per hour, the income tax per hour is $10 and their GDP per hour is $100. The laid off worker has to take a job paying $8 per hour, now pays no income tax because his earnings are so low, and is producing $20 worth of product per hour. Now the income tax paid per hour for the three is $10 and the GDP per hour is $120. The percent income tax to GDP is now $10/$120 or 8.3%. Did income tax rates fall? No income fell. That was my point, by comparing income tax as a percentage of GDP, rather than income is gives false picture of what is happening. And I am sorry, but Obama has businesses scared to spend or hire because they do not know what he is going to hit them with next. As I said, this is somewhat like telling how well the tainted Tylenol cured headaches.

kewaal of GA 9:13PM February 08, 2011

If you're saying 1950 was a different time why did you just compare them on your post?
"We were on the silver standard-money had a "hard" foundation-not like the funny money the FED/Treasury cranks out nowadays."
Money still has a "hard" foundation. We are off a precious metals system but they still play a factor in the value of monies. The standard now is based on commodities which along with corn, wheat, coal, oil, steel, etc also include precious metals such as silver. They crank out the money true but there is a foundation behind it...probably the reason you've seen commodity prices soar recently. Gold, etc. will go up and those who are invested make money. The real effect in america which still has a largely agricultural element to our economy is that price increases on corn, wheat, and other agricultural commodities as well and will boost farmers' income.
Also in 1950s cars were still a relatively new and specialized market with a limited number of "experts" which usually makes for higher earnings. As more and more cars are out there and more and more people have flooded the market, fully trained and capable, the value of doing such labor has been reduced. The fact that a person who was a mechanic then could afford a beach house and one today can't is more a result of a shift in the industry and not the current tax situation or administation's policies (see my post about the dow jones).
Finally, point 4. "Onerous government regulation - Green and otherwise - have raised the costs of food, housing, transportation and energy... and just about everything else."...which also feeds into the point about a main street recover. Big business has played a major role in small business struggling to gain footing in the decades following the 1950s. Government regulation wasn't necessary when energy needs are easily gained however when you realize that there will be an energy shortage if regulations aren't placed then steps must be taken. Costs must rise. unfortunately the choice to ignore it means wasted energy and a lower cost and quicker collapse when it all runs out. regulation is necessary. It was as irresponsible a policy then to not regulate as it would be now. also, cutting and regulating energy and having your company implement energy saving policies is one way for businesses to cut the cost of doing business in the long term.
You're correct that Truman's was a different world but the problem is your points don't accurately reflect what those differences were as its more nostalgic tha accurate. your conclusion of "Are these changes Obama's fault? Of course not, but he is certainly more a part of the problem rather than of the solution." again i ask that you refer to the dow jones being up 50% and manufacturing numbers also are going up since his taking office.
You know what else has changed since 1950s america...black people are able to vote like real american citizens. As you said "Truman's was a [very] different world."

Thomas of PA 5:17PM February 08, 2011

kewaal of GA,
You stated that "I am in sales and I pay fewer taxes than any time in the past. It is because my income is 1/6 of what it was three years ago."
The tax numbers at their lowest are based on the percentage taken from salaries and the percentage of the budget that is paid for by taxation, not based on the total sum of the money you have taxed. I understand its frustrating but the reason for your reduction probably stems more from an 8 year run up to economic disaster (2000-2008) than in obama's tax and economic policies (previous admin's policies were the cause). I'm sure your sales figures will continue to improve as the economy continues to bounce back and you'll appreciate the measures that are in place, unfortunately you currently don't understand that those policies are getting good results so lets take a look at two indicators of growth....
...The dow was around 8,000 when Obama took office, its now at 12,000 after two years of policies. Thats a 50% increase. Also U.S. manufacturing numbers are up so its unlikely to be a "false boom". EVERYONE, including obama, agrees that unemployment needs to go down but that will come as more and more businesses realize that growth is happening and they will hire accordingly. One follows the other and the good news is we will know by 2012 if the recession is in our rear view window.

Thomas of PA 4:34PM February 08, 2011

1. We were on the silver standard - money had a "hard" foundation - not like the funny money the FED/Treasury cranks out nowadays.
2. My father was a "lube and tune" mechanic in the 50's, was able to afford a beach house in Santa Monica and raise a family. These days a "grease monkey" has to live in his mother's basement.
3. It takes two incomes to even approach the most basic standard of living of the 50's and 60's.
4. Onerous government regulation - Green and otherwise - have raised the costs of food, housing, transportation and energy... and just about everything else.
5. The "real" jobless rate today is higher than at any time in our nation's history.
6. The "cost of doing business" in America is so great that it is unlikely that any significant "Main Street" recovery will take place. The industry and jobs have left, and energy production all but destroyed here.
Are these changes Obama's fault? Of course not, but he is certainly more a part of the problem rather than of the solution.

R.L. Schaefer of CA 11:58AM February 08, 2011

Well, of course a liberal who cannot see five minutes ahead of himself cannot see anyone calling obooboo an idiot!
Inasmuch as a debate with the guy, ANYBODY could dump all over him because he doesn't answer any questions ....he even hid ALL of his personal documentation of himself in his very first Executive Order #13489:
http://www.fas.org/sgp/obama/presidential.html
.....so, here I am wondering why I'm wasting my time w/ this guy??

Super Power Play of CA 10:54AM February 08, 2011

I'm not understanding how one can call this President an idiot? Bush, Palin, yes, Mr. Obama is most likely one the smartest people in whatever room he's in. I understand that you don't like him but please........I doubt you could win a debate with him.

Ed of IN 10:21AM February 08, 2011

So liberals are saying that we pay less taxes with Obama as president. And the main reason is everyone is either unemployed or is making less money.
Wow. And this is something liberals are proud of?
Of course I also heard John Kerry credit the economy and people out of work, with lower greenhouse gas emmissions too! So all we have to do is get unemployment up to 50% or 60% and we can save the earth!
Yeah, keep up the good work liberals........

Heather of MA 10:03AM February 08, 2011

Either something is or it is not. I think the tax rate is lowest in 70 years. Also these tax winers really don't pay taxes. I cannot imagine this guy above me pays any taxes besides his w2 payroll, SSI and Medicare tax. He will probably get more out of both systems he pays in.

Ron of CA 9:16AM February 08, 2011

Of all of the asinine reports I have read to help prop up this absolute economic idiot of a president this takes the prize. I am in sales and I pay fewer taxes than any time in the past. It is because my income is 1/6 of what it was three years ago. Our tax system has evolved to the point that almost half do not pay taxes. As Obama’s policies keep destroying jobs and more people fall into lower income brackets, that number will increase. The first thing I thought of after reading this was that this makes as much sense as if after the tainted Tylenol scandal several years ago, Schlesinger had written how well it cured headaches.

kewaal of GA 9:12AM February 08, 2011

There is an old saying that figures don't lie but liars figure. Whatthis boils down to is everyone is unemployed, businesses are shutdown so there are very few actual taxes being paid. So with the feds pumping multi-trillions of dollars into social spending into the economy which they actually count as GDP, taxes as a percentage of GDP are low.

Marc of MA 9:02AM February 08, 2011