A major cause of the tax revolt of the 1970s was that inflation was pushing Americans into ever-higher tax brackets even though their real incomes were stagnant. So Congress indexed part but not all of the income tax code to take account of inflation.
Now it is the booming U.S. economy that is pushing Americans into higher brackets. As prosperity raises real incomes, the government’s share of the pie grows.
While Americans were visibly upset when inflation sent their taxes soaring, analysts have noted that today’s taxpayers seem less concerned when it is prosperity propelling their taxes higher.
That may explain, to some degree, the lukewarm reception tax cut proposals are getting.
Source: Peter Brimelow, Charticle: Income Creep, Forbes, October 16, 2000.
For more on Tax Burden in the 1980s & 1990s http://www.ncpa.org/pi/taxes/tax31.html
