While only a minority of people was taxed during World War II, the politicians got a taste of the huge revenues... by expanding the tax base. After the war... the income tax was steadily expanded until it applied to most Americans...

You could say that GDP (National Income) and prosperity and wealth grows fastest when income tax rates are highest. And wealth slows, the economy slows, when taxes are cut. That's counter intuitive but if you look at any chart comparing tax rates and economic growth rates that's what you find. The 19th century knew it, the 18th century knew it but today you have a kind of counter revolution of junk economics that is basically anti-labor economics.

A fourth factor underlying the merger wave of the 1960’s was the steep rise in the load of corporate income taxation since World War II. In 1940, the effective federal corporate income-tax rate was 27 percent; in 1968, it was 50 percent. Rates of state and local taxes on business incomes have risen commensurately.

American business is like no other in history. It is owned by millions, it employs millions more, it serves all 190 million of our people. The promise for their lives rests upon the performance of your enterprise. While some of you may not be interested in our success, I can assure you that we here in Washington are greatly interested in your success. I am glad I can say today that no businessmen anywhere have ever at any time enjoyed the measure of success that American businessmen are enjoying now. For 42 consecutive months, we have had the longest and the largest peacetime expansion of our economy on record. These years from 1961 through 1964 are going into the record books as the most prosperous years of our history. It is prosperity not just for businessmen--it is prosperity for all the people of this Nation.

The trend toward soaking business and the wealthy gained further momentum in the fiscal year 1942-43. The disproportionately large increase in domestic tax revenues that year can be traced to the state’s imposing the so-called estate inflation tax.

[T]he Internal Revenue Service in 2003 released its first public analysis of tax returns filed by the 400 highest income Americans... from 1992 to 2000. ...the federal income tax burden on Americans overall rose by 18 percent, it fell by 16 percent for the top 400, whose incomes soared.

Let's be clear about some things: over the last 20 years the United States has had a hard time achieving economic growth. The last year or two are slightly better, parts of them than the previous ones, and there's no mystery for that: it's because the government gave an enormous boost to the economy. Let me say that again: not private enterprise, not private capitalist corporations, the government gave an enormous boost. What was the form of the boost? The 2017 tax cut in December of that year, which gave corporations a vast amount of hundreds of billions of dollars in taxes they don't have to pay anymore, freeing up that money for them to do whatever they want with; and they mostly used it to increase salaries of executives, to buy back shares of stock in the stock market. All of which was very good for the top one percent, but not for the rest of the American people. All of that is hidden under the rug by Mr. Trump. But even the performance, getting our growth rate up to 3% for a part of that time, even though it's averaging out to two and a half to three percent, that that's the best in the world, that's just a lie!

In 1800, a prosperous year, the total income of Americans (called ‘the national income’) was something over 2 billion dollars, a fabulous amount then. Capitalists and landlords got 68%, farmers and laborers 32%. In 1930, of tragic memory, near the bottom of ‘the worst depression in history’, the incomes of all Americans amounted to roughly to 75 billion. Of this wage earners (who had increased in number 17%) got 64%+; entrepreneurs, 20%; capitalists and landlords the remaining 16%.

So there's no question about it: by the mid-fifties, America was definitely in a Golden Era, an era of excitement and opportunity for all citizens, regardless of race or creed or color, unless the person happened to be black. Then there was a problem.

[During the]...’Decade of Greed,’ the United States experienced the greatest economic boom in its history… huge strides were made in economic opportunities for minorities, and Americans gave to charities at record levels. If this is what it means to have a ‘Decade of Greed,’ let’s have another.

Inflation, combined with the end of real growth in wages beginning in 1973, created... "bracket creep" that moved people into higher tax brackets even if... real incomes were unchanged.

One of the hackneyed liberal complaints goes something like this: 'Bush is the first president in history to cut taxes during a war.' Nonsense. Bush didn’t cut taxes; he cut tax rates across the board - on income, dividends and capital gains. And that’s precisely why tax revenues have soared. When a department store wants to make more money, it doesn’t raise its prices, it cuts them and announces a big sale. If you want more work and investment, you hold a sale on economic activity by cutting tax rates, thereby reducing the cost of productive activity and increasing the prospect of after-tax returns on work and investment.

All this notwithstanding, the twenties in America were a very good time. Production and employment were high and rising. Wages were not going up much, but prices were stable. Although many people were still very poor, more people were comfortably well-off, well-to-do, or rich than ever before. Finally, American capitalism was undoubtedly in a lively phase. Between 1925 and 1929, the number of manufacturing establishments increased from 183,900 to 206,700; the value of their output rose from $60.8 billions to $68.0 billions.1 The Federal Reserve index of industrial production which had averaged only 67 in 1921 (1923–25= 100) had risen to 110 by July 1928, and it reached 126 in June 1929.2 In 1926, 4,301,000 automobiles were produced. Three years later, in 1929, production had increased by over a million to 5,358,000,3 a figure which compares very decently with the 5,700,000 new car registrations of the opulent year of 1953. Business earnings were rising rapidly, and it was a good time to be in business. Indeed, even the most jaundiced histories of the era concede, tacitly, that times were good, for they nearly all join in taxing Coolidge for his failure to see that they were too good to last.

In many ways, the US led the world toward the development of progressive taxation and the reduction of inequality at the global level during the first half of the 20th century... Unfortunately, one century later, in 2019, the rise of inequality creates new threats to liberal democracies. It is time to take a new step and to develop new policy instruments, in line with the challenges raised by global wealth trends.