diet coke for breakfast

Tuesday, September 30, 2003

Posted by RFTR - The Rich Recession: "It is this progressivity that makes the federal government so hugely dependent on top earners for revenue. In the period 1997-to-2000, the last years of the Clinton bubble, adjusted gross income for the top 1% went up every year and so did its share of all income taxes paid. When times are really good, in other words, tax revenue from the rich tends to increase faster than the economy. When times are bad, however, federal revenue falls faster than overall growth does. This helps to explain the wide budget swings in the past decade from deficit to surplus and back to deficit."

An interesting explanation that I'd never considered before. It helps the liberal rhetoric to say that Bush drove us from surplus to defecit, and it's always surprised me that that would be possible. This seems to explain some of that broad swing.


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