The stock-market crash, not high FDR-era taxes, caused the ‘great leveling’ of the middle 20th century.

By Phillip W. Magness and Vincent Geloso
April 11, 2022

The political left’s love affair with steep progressive taxation got an academic boost with the publication of Thomas Piketty’s bestselling 2014 book, “Capital in the Twenty-First Century.” Appealing to the New Deal era, Mr. Piketty proposed a simple explanation and remedy for rising economic inequality: The concentration of income among the top 1% could be mitigated by strategically targeting wealth with the tax system.

Mr. Piketty based his theory on a historical argument taken from his own empirical work with fellow economist Emmanuel Saez. When Congress and President Franklin D. Roosevelt hiked the top marginal...

The stock-market crash, not high FDR-era taxes, caused the ‘great leveling’ of the middle 20th century.

By Phillip W. Magness and Vincent Geloso
April 11, 2022

The political left’s love affair with steep progressive taxation got an academic boost with the publication of Thomas Piketty’s bestselling 2014 book, “Capital in the Twenty-First Century.” Appealing to the New Deal era, Mr. Piketty proposed a simple explanation and remedy for rising economic inequality: The concentration of income among the top 1% could be mitigated by strategically targeting wealth with the tax system.

Mr. Piketty based his theory on a historical argument taken from his own empirical work with fellow economist Emmanuel Saez. When Congress and President Franklin D. Roosevelt hiked the top marginal income-tax rate to 91% during the New Deal and World War II…