RyanHoovernomics

New House Republican Plan a Blast from the Past

There's a nice symmetry to the House Republican budgeteers’ idea of cutting the top tax rate for the very wealthy to 25 percent. The spending side of their budget would go a long way to giving us Herbert Hoover's economy, so why not have their tax rate on the rich match Hoover's? In fact, we haven't had a top rate that low since Hoover lost his re-election bid to Franklin Roosevelt in 1932.

Of course, for those today with the very highest incomes, most of their income is taxed as capital gains, which for most of our history has gotten a special low rate. The rate now is 15 percent. It was 12.5 percent under Hoover. Rep. Paul Ryan (R-WI), the chief architect of the House plan, thinks it ought to be zero.

The rich liked Hoover, too. The middle class, or what was left of it after the Great Depression, not so much.

Michael Ettlinger is the Vice President for Economic Policy at American Progress.

See also:

• House GOP Plan Swipes at Social Security by David Madland and Christian Weller
• Ryan’s Hidden Middle-Class Tax Hike by Michael Linden
• Protecting Big Oil at the Expense of the Future by Daniel J. Weiss and Richard W. Caperton
• A Massive Gift to Wall Street by David Min
• GOP Budget Slashes Pell Grants by Julie Margetta Morgan
• Ryan’s Step Backward for Education by Diana Epstein
• Rep. Ryan’s Proposed Infrastructure Savings Don’t Add Up by Donna Cooper
• An Exclusive 'Path to Prosperity' by Heather Boushey
• Ryan’s Unbelievable Path to Prosperity by Heather Boushey and Adam Hersh