The extraordinary thing about Warren Buffett’s call for higher taxes on America’s super-rich was not a billionaire demanding that more of his cash to be sent to the government. It was that anyone noticed, for Mr Buffett’s assertion that the rich should pay more is hardly as bold as it seems.
For most of the past century America’s wealthiest have paid a vastly higher percentage of their income to taxes than they do now. They have also paid much higher rates during periods of national crisis, when America has felt it more natural to turn to them for support. In the period around the first world war this meant a top rate of 73 per cent. When we were climbing out of the Great Depression this hit 79 per cent, and at the peak of the second world war soared to 94 per cent.
Taxing the rich at higher rates, despite the cant that it drags down job creation and growth, has been a hallmark of America’s greatest expansions too, including the boom years after the second world war. The cuts in rates introduced by President George W. Bush, meanwhile, have also proved that reducing the burden on the richest brings no obvious benefits in terms of job growth, given that the decade since those cuts was the first in US history with no net job creation.