http://news.investors.com/ibd-editorials-perspective/010413-639424-obama-high-taxes-still-worse-than-1950s-tax-rates.htm

Unfortunately, the tax situation wasn't what it seemed. The illusion commences with that famous 1950s top rate of 91%. Official rates matter, but so do effective rates, the percent of income that people actually pay in tax. The Internal Revenue Service reckoned the effective rate of tax in 1954 for top earners was actually 70%.

Or lower. Marc Linder, a law professor at the University of Iowa, has shown that a more comprehensive interpretation of income that includes capital gains suggests the real effective tax rate for millionaires was 49% in 1953. The effective rate dropped throughout the decade, reaching 31% by 1960.

That 31% is just slightly higher than the 29% level a Congressional Budget Office report figures the average effective tax for the top quintile will be in 2014. And that number for 2014 doesn't include taxes in Obama's health care law.

A second fantasy about the 1950s is that government soaked the rich. Joseph Thorndike and Martin Sullivan in Tax Notes magazine took a look at the tax distribution of the decade. They found that those earning more than $100,000 paid less than 5% of the taxes collected in the U.S., a far smaller share than the wealthiest shoulder today.


In fact, the rich in the US pay an overwhelming majority of taxes today.