Coronavirus, Covid 19 Discussion and How It Has Affected Your Daily Life Chat Thread

[Beer can]

Not really on topic, but we have a lot of undertaxed people and businesses in the US paying poverty wages and taking in government subsidies. We've had marginal tax rates as high as 92% in the US history and the country did not fall apart, including during other pandemics. There was a 50 year period up until the 80's were the marginal tax rate was over 60%. Right now we have a marginal tax rate around 37%. Higher tax rates also often coincide with higher per capita GDP, benefitting the economy as a whole. There's a balance to be struck here and during a national emergency I don't see why we couldn't close tax loopholes and raise the marginal rate to what it used to be when my parents were my age or what it was during our last national pandemic.

https://www.taxpolicycenter.org/statistics/historical-highest-marginal-income-tax-rates
https://www.macrotrends.net/countries/USA/united-states/gdp-per-capita
https://www.epi.org/publication/ib364-corporate-tax-rates-and-economic-growth/

All those years of varying tax rates, like you said up to 90s%, 50%, 30%, it hasn't really mattered much adjusted for inflation etc, the tax dollars the federal government took in has always remained about the same.

 

[ChocolateMouse]

@Beer can
https://www.frbsf.org/our-district/about/sf-fed-blog/print-order-currency-treasury/

The federal reserve prints an additional 0.001% of our economy's total liquid value in money every year.
The inflation rate is 1-3% yearly. Those numbers don't add up.

 

[Beer can]

@Beer can
https://www.frbsf.org/our-district/about/sf-fed-blog/print-order-currency-treasury/

The federal reserve prints an additional 0.001% of our economy's total liquid value in money every year.
The inflation rate is 1-3% yearly. Those numbers don't add up.

https://www.google.com/url?sa=t&sou...FjAAegQIDxAD&usg=AOvVaw0X8CikYMswGF2utcB1MtTW

 

[ChocolateMouse]

All those years of varying tax rates, like you said up to 90s%, 50%, 30%, it hasn't really mattered much adjusted for inflation etc, the tax dollars the federal government took in has always remained about the same.

Really?
My math says otherwise;
https://www.thebalance.com/current-u-s-federal-government-tax-revenue-3305762
Tax revenue by year early 1960s; 100 billion (approx)
https://www.in2013dollars.com/us/inflation/1960?amount=1000000000
Inflation amount since 1960; About 780%

1960's tax revenue would be
~73,000,000,000,000
Actual tax revenue for the year 2018
~3,300,000,000,000

That seems off by a factor of about *20?

Are your numbers coming up different?

 

[Sapphire Sebright]

https://www.google.com/url?sa=t&sou...FjAAegQIDxAD&usg=AOvVaw0X8CikYMswGF2utcB1MtTW

Whoaaaaaaaaaaaaaaaah so many numbers!
(I'll make sense of it... eventually... finance isn't my thing, ahh!)
(This is interesting, though).

 

[Sapphire Sebright]

Oh, yeet, the student loan average makes me so very sad/disappointed... that's so much, and it would take ages to pay off....

 

[ChocolateMouse]

https://www.google.com/url?sa=t&sou...FjAAegQIDxAD&usg=AOvVaw0X8CikYMswGF2utcB1MtTW

Whoaaaaaaaaaaaaaaaah so many numbers!
(I'll make sense of it... eventually... finance isn't my thing, ahh!)
(This is interesting, though).

None of that actually tells you where inflation COMES from though.... It's just a bunch of running numbers.

 

[MarkJr]

None of that actually tells you where inflation COMES from though.... It's just a bunch of running numbers.

Here CM. This will explain far better than I ever could.
https://www.indeed.com/career-advice/career-development/how-to-calculate-inflation-rate

 

[Sapphire Sebright]

Here CM. This will explain far better than I ever could.
https://www.indeed.com/career-advice/career-development/how-to-calculate-inflation-rate

An equation that I understand!
(This was interesting -- thanks for linking it).

 

[ChocolateMouse]

That is a fine article on how to calculate specific inflation that tells the reader nothing about where inflation comes from... And when we calculate inflation rates, as stated above, we can see that taxation has not kept up.

https://www.forbes.com/sites/johntharvey/2011/05/30/what-actually-causes-inflation/?sh=67411aebf9a9

This has an explanation of the question I asked, though it's still very pro-business and limited in scope. But the short version of it is inflation happens because someone, somewhere, raised prices for some reason. Sometimes it's because something else got more expensive (like wages), and rarely it's because of a supply shock (like the pandemic causing chicken processing plants to shut down) but more often it happens because there's the opportunity to make more money.

Here's a more pro-wall-street source;
https://www.investopedia.com/ask/answers/111314/what-causes-inflation-and-does-anyone-gain-it.asp