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Tyler Cowen

The Democrats’ Latest Idea on Taxes Will Only Help Trump

A top marginal income tax rate of 70 percent is bad economics and even worse politics.

The 70 percent solution?

The 70 percent solution?

Photographer: Saul Loeb/AFP/Getty Images

One of my strongest political memories is of Democrats lamenting their loss to Donald Trump. How could this have happened, they asked. We won’t ignore the Midwest again! We’ll pay closer attention to the working middle class! Yet I now see Democrats making a similar mistake: They are talking about a 70 percent marginal tax rate in a manner that could not be better designed to split their coalition.

Rep. Alexandria Ocasio-Cortez has been promoting the idea of a 70 percent top marginal tax rate, and Paul Krugman has been defending it. Matthew Yglesias of Vox has written that 70 percent might be too low.