I've already supported it from several different sources, here are additional sources:
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Krugman and journalist Timothy Noah have referred to this period after 1979 as the “Great Divergence.”[18] During this time income became more unequal almost continuously except during the recessions in 1990-91 and 2001.[26]
One difference in the income of high-income taxpayers between the two eras is that labor income has become a larger share of their income while capital income (interest, dividends, income from rent) a much smaller one.[27]"
"In 2011
the Congressional Budget Office (CBO) did a study of the change in income inequality in America ("Trends in the Distribution of Household Income Between 1979 and 2007"). (It chose the two years because they both preceded an economic recession and so both were periods of "similar overall economic activity"
"The
study found two factors accounting for the changing distribution of market (before tax) income:
an increase in the concentration of each source of income (different sources being: labor income, business income, capital gains, interest, etc.); and a shift in the share of income in the economy coming from sources that disproportionately go to top earners. Between 1979 and 2007 more income came from capital gains and business income, and less from labor (cash wages, salaries, employer-paid health insurance premiums, etc.)."
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A study by Thomas Piketty and Emmanuel Saez found that
Large reductions in tax progressivity since the 1960s took place primarily during two periods: the Reagan presidency in the 1980s and the Bush administration in the early 2000s.[125]
During Republican President Ronald Reagan's tenure in office the top marginal income tax rate was reduced from over 70 to 28 percent, high top marginal rates like 70% being the sort in place during much of the period of great income equality following the “Great Compression”.[124] Progressivity of income tax and the (effective) rate at which income is taxed can have an effect on equality."
Income inequality in the United States - Wikipedia, the free encyclopedia
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The Internal Revenue Service issues an annual report on the 400 highest income-tax payers. In 1961, there were 398 taxpayers who made $1 million or more, so I compared their income tax burdens from that year to 2007.
Despite skyrocketing incomes,
the federal tax burden on the richest 400 has been slashed, thanks to a variety of loopholes, allowable deductions and other tools.
The actual share of their income paid in taxes, according to the IRS, is 16.6 percent. Adding payroll taxes barely nudges that number.
Compare that to
the vast majority of Americans, whose share of their income going to federal taxes increased from 13.1 percent in 1961 to 22.5 percent in 2007.
9 Things The Rich Don't Want You To Know About Taxes