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When the middle and working classes have more money to spend it boosts the whole economy. They're the rising tide that raises all ships. When the rich have more money that money mostly stays at the top. Goods and services fuel economic growth, not the monetary maneuvering of the uber-wealthy.
While I do generally agree about spending/economy, do we actually have a historical case in which stimulus targeted directly at the middle/working class resulted in a sustained observable economic growth?
While I do generally agree about spending/economy, do we actually have a historical case in which stimulus targeted directly at the middle/working class resulted in a sustained observable economic growth?
Yes, construction of the interstate highway system.
Stimulus targeted at infrastructure creates middle class jobs. Stimulus targeted at bailing out banks... not so much.
So I was thinking the other day (dangerous I know) and wouldnt any attempt to give the middle class/lower class a stimulus or wage increase just make the 1% RICHER....bear with me now. The 1% own the businesses we buy from....when the typical American gets money, they spend it....when we buy something, it makes the owners wealthier....e.g...if we make more money, the 1% will just get richer?
Well, if people have more income, they're more likely to spend it, which puts money back into the economy. But that money could be spent at the local mom-and-pop as easily as at a corporate behemoth. But either way, incomes for the 1% are fixed, and that money spent by the lower classes wouldn't necessarily find its way back up the ladder. The largest benefit would be to shareholders, who would see their investments go up on the stock market if the company reports better profits for the quarter.
Generally, the 1% keep their cash pile and grow it when they resist wage increases for the people who actually run their companies on a day-to-day basis.
In short, raising wages benefits average people, but holding wages down benefits the 1%.
Yes, construction of the interstate highway system.
Stimulus targeted at infrastructure creates middle class jobs. Stimulus targeted at bailing out banks... not so much.
So basically the New Deal and the like. Thanks. I never really thought of that effort to be middle/lower "stimulus". I was thinking stimulus in the form of tax breaks only. But I get it.
If tax dollars were used in a similar way today, I think I could support that. This is inline with my initial post here.... maintain education, opportunity, and class mobility.
I do absolutely agree... stimulus targeted towards the large corporate such as banks was not the way to stimulate middle class growth. As we have already seen.
So I was thinking the other day (dangerous I know) and wouldnt any attempt to give the middle class/lower class a stimulus or wage increase just make the 1% RICHER....bear with me now. The 1% own the businesses we buy from....when the typical American gets money, they spend it....when we buy something, it makes the owners wealthier....e.g...if we make more money, the 1% will just get richer?
The owner of the corner pizzeria is probably not part of the 1%. The owner of a shoe store in the mall is probably not part of the 1%. Likewise with the nearest farmers market. Raises tend to get spent locally supporting local business that compete with Walmart.
While I do generally agree about spending/economy, do we actually have a historical case in which stimulus targeted directly at the middle/working class resulted in a sustained observable economic growth?
For decades after WWII just about every economic policy in America was aimed at enlarging and sustaining the middle and working classes. It was done somewhat at the expense of the wealthy(higher taxes for them) and largely through the use of socialism. The most prosperous time for the middle class in America's history was the direct result of widespread unionization and socialist policies. When economic policy shifted to "top-down" schemes(trickle down economics) the tide turned and the wealth gap started widening, unions became villainized, wages stagnated, more people fell out of the middle class, fewer people rose from poverty to the middle class or higher, and a perpetual economic underclass was created.
For decades after WWII just about every economic policy in America was aimed at enlarging and sustaining the middle and working classes. It was done somewhat at the expense of the wealthy(higher taxes for them) and largely through the use of socialism. The most prosperous time for the middle class in America's history was the direct result of widespread unionization and socialist policies. When economic policy shifted to "top-down" schemes(trickle down economics) the tide turned and the wealth gap started widening, unions became villainized, wages stagnated, more people fell out of the middle class, fewer people rose from poverty to the middle class or higher, and a perpetual economic underclass was created.
Thanks.
" It was done somewhat at the expense of the wealthy(higher taxes for them) and largely through the use of socialism."
If you willing and have the time.... please explain in the context of socialism.
" It was done somewhat at the expense of the wealthy(higher taxes for them) and largely through the use of socialism."
If you willing and have the time.... please explain in the context of socialism.
There was at the time a corporate welfare system. They had a moral obligation to have pensions etc. Those went away with the take over craze in the 1980's. Hostile take overs would come in and raid the pension funds. Corporations were encouraged to run up large debts to make them unattractive for take overs. That was part of it anyway.
Some reference material. Not necessarily quantitatively accurate, but somewhat qualitatively accurate.
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