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From the early 30s to mid 70s, corporate taxes and income taxes were much higher than they are now. Labor unions were much stronger and successful at boosting wages and benefits. But oddly that was by far the best economic period in our history. Real median income rose by 3x, and fiscal and private debt was low.
The driving force for investment and innovation is DEMAND. People with money in their pockets wanting to spend it. Baring that, you can escalate public and private debt, which we've been doing for ~40 years. But you can only do that so long. The problem isn't that capitalists are oppressed with taxes, rather that our system was modified to allow them to extract higher profits at the expense of wages. This has created an imbalance. They have an excess of capital but don't invest because the buying capacity of the public is depressed.
Is this not obvious?
I'm curious about that. How was the system modified to accomplish what you are claiming?
From the early 30s to mid 70s, corporate taxes and income taxes were much higher than they are now. Labor unions were much stronger and successful at boosting wages and benefits. But oddly that was by far the best economic period in our history. Real median income rose by 3x, and fiscal and private debt was low.
The driving force for investment and innovation is DEMAND. People with money in their pockets wanting to spend it. Baring that, you can escalate public and private debt, which we've been doing for ~40 years. But you can only do that so long. The problem isn't that capitalists are oppressed with taxes, rather that our system was modified to allow them to extract higher profits at the expense of wages. This has created an imbalance. They have an excess of capital but don't invest because the buying capacity of the public is depressed.
Is this not obvious?
The US was in a depression in ALL of the 1930's, which only really ended when there was a surge of military investment starting in 1940. There was also the "recession within a depression" in 1937 and 1938.
For the first half of the 1940's the US was involved in WWII, which created full employment, as well as cost around $4T in today's dollars. 1945 war spending was around 40% of US GDP.
Following WWII for approximately 10 years or so, Europe and most of Asia were still rebuilding while the US was largely untouched. US manufacturing was in a boom period to help supply the world.
The economy of the latter part of the 1960's was consumed with the Vietnam War. Spending in today's dollars was around $1 Trillion for the 8 years.
After US involvement in Vietnam was winding down was a big recession in 1973-1975 which led to stagflation.
The big "decoupling" between productivity, wage growth and other factors seemed to happen after 1971 when the US exited Bretton Woods. By liberalizing trade it also had the side effect of encouraging developing nations to invest and take over manufacturing jobs as the US could no longer compete.
I'm curious about that. How was the system modified to accomplish what you are claiming?
Lower income taxes, lower corporate taxes, "deficits don't matter", easy credit, "free trade" (there is a whole lot of detail under that heading), trade unions gutted, illegal immigration, etc. Getting women into the workforce was also an important part of forestalling the crisis.
When you understand how symbiotic production and consumption are, then you will also see what is needed to maximize the aggregate wealth of a modern economy. We did that for awhile in the middle of the last century, but since then it's been about how to maximize $$$ for the few. It has worked perfectly btw; real income for the top .01% has gone up >1,000% since the 70s, while median income has risen maybe 10%.
What are the hallmarks of this capitalist utopia you dream of, and why has it never existed and will never exist?
Where was a capitalist utopia mentioned?
All I pointed out was that the Leftist gripes are about privileged entities who are not real capitalists.
Capitalist Principles
...
CAPITALISM - An economic system in which the means of production, distribution and exchange are privately owned and operated for private profit.
- - - WEBSTER'S DICTIONARY
PRIVATE PROPERTY - "As protected from being taken for public uses, is such property as belongs absolutely to an individual, and of which he has the exclusive right of disposition. Property of a specific, fixed and tangible nature, capable of being in possession and transmitted to another, such as houses, lands, and chattels."
- - - Black's Law dictionary, sixth ed., p.1217
If you concatenate capitalism with private property, you can see the "inconvenient truth".
❏ CAPITALISM is an economic system in which the means of production, distribution and exchange are absolutely owned by INDIVIDUALS and operated for their individual profit.
If you think about it, capitalism is an endowment (right) to be secured by government. There is no government privilege involved in absolute ownership of the means of production, distribution and exchange, and of the gain derived. Nor can capitalism be subject to an excise tax, since no government privilege is involved. (And all constitutions explicitly protect private property ownership)
This definition does NOT include qualified ownership (estate), usury, gambling (underwriting), speculation, extortion, limited liability artificial persons (government privileged), group ownership or other predatory practices usually attributed to "capitalism". Coincidentally, such practices are subject to an excise tax, for they are revenue taxable privileges. In other words, so-called “Capitalists” are actually predators upon capitalism (property owners). And since 1933, they’re really “Crony Socialists.”
The US was in a depression in ALL of the 1930's, which only really ended when there was a surge of military investment starting in 1940. There was also the "recession within a depression" in 1937 and 1938.
The bottom was in 1932. The economy boomed right after that, but it took longer to get back to previous levels.
Quote:
Originally Posted by markjames68
For the first half of the 1940's the US was involved in WWII, which created full employment, as well as cost around $4T in today's dollars. 1945 war spending was around 40% of US GDP.
Following WWII for approximately 10 years or so, Europe and most of Asia were still rebuilding while the US was largely untouched. US manufacturing was in a boom period to help supply the world.
The economy of the latter part of the 1960's was consumed with the Vietnam War. Spending in today's dollars was around $1 Trillion for the 8 years.
War is incredibly wasteful economically, unless you can profit directly from winning it. Even in WW2 this was not the case, and in Korea and Vietnam it definitely was not. Yet our economy was so strong that we were able to wage these wars and even pay off the debt (in %GDP terms)! War only "stimulates" the economy for the same reason that other government debt financed projects stimulate the economy. Only in that case we get something useful (hopefully) rather just a bunch of stuff produced and destroyed.
The US did not "supply the world" post-WW2. Else we would have had a large trade surplus, and we didn't. The US boomed supplying itself.
Quote:
Originally Posted by markjames68
The big "decoupling" between productivity, wage growth and other factors seemed to happen after 1971 when the US exited Bretton Woods. By liberalizing trade it also had the side effect of encouraging developing nations to invest and take over manufacturing jobs as the US could no longer compete.
The whole idea of "competing" began with NAFTA as I recall. It is a ridiculous notion that keeps getting repeated like it's a fact of life. Generally it's assumed that US workers must compete with cheap foreign labor. But this was just an excuse to destroy unions and let companies move production overseas, and then freely bring that production back in the US. Lower costs, and bigger profits. In order to sustain the inevitable trade deficit, fiscal debt must be escalated, but this is old news. And of course that can't be sustained forever, but it can go on for a very long time, as history has shown!
Going off the gold standard and Bretton Woods were key features of the big shift that happened in the 70s that enabled the mega rich to get a lot richer. Fiat currency isn't inherently bad at all, but if you want to have long sustained trade and fiscal deficits, then you need it. And so we got it.
The bottom was in 1932. The economy boomed right after that, but it took longer to get back to previous levels.
War is incredibly wasteful economically, unless you can profit directly from winning it. Even in WW2 this was not the case, and in Korea and Vietnam it definitely was not. Yet our economy was so strong that we were able to wage these wars and even pay off the debt (in %GDP terms)! War only "stimulates" the economy for the same reason that other government debt financed projects stimulate the economy. Only in that case we get something useful (hopefully) rather just a bunch of stuff produced and destroyed.
The US did not "supply the world" post-WW2. Else we would have had a large trade surplus, and we didn't. The US boomed supplying itself.
The whole idea of "competing" began with NAFTA as I recall. It is a ridiculous notion that keeps getting repeated like it's a fact of life. Generally it's assumed that US workers must compete with cheap foreign labor. But this was just an excuse to destroy unions and let companies move production overseas, and then freely bring that production back in the US. Lower costs, and bigger profits. In order to sustain the inevitable trade deficit, fiscal debt must be escalated, but this is old news. And of course that can't be sustained forever, but it can go on for a very long time, as history has shown!
Going off the gold standard and Bretton Woods were key features of the big shift that happened in the 70s that enabled the mega rich to get a lot richer. Fiat currency isn't inherently bad at all, but if you want to have long sustained trade and fiscal deficits, then you need it. And so we got it.
No *****, lol. Prior to America’s nonsense political wars, wars were fought to win and strip wealth. That’s howconflicts we’re solved since the beginning of time. The existence of nukes created mad and so now all sorts of aborations have been allowed to exist. Russia is changing the game by actually leveraging there massive nuclear arsenal. Nukes are the future but only if more and smaller groups can leverage them.
Lower income taxes, lower corporate taxes, "deficits don't matter", easy credit, "free trade" (there is a whole lot of detail under that heading), trade unions gutted, illegal immigration, etc. Getting women into the workforce was also an important part of forestalling the crisis.
Nice list of grievances, but none of that brings about what you've claimed:
Quote:
our system was modified to allow them to extract higher profits at the expense of wages.
Quote:
When you understand how symbiotic production and consumption are, then you will also see what is needed to maximize the aggregate wealth of a modern economy. We did that for awhile in the middle of the last century, but since then it's been about how to maximize $$$ for the few. It has worked perfectly btw; real income for the top .01% has gone up >1,000% since the 70s, while median income has risen maybe 10%.
The rich keep getting richer because they continue doing those things that make them rich. Ditto for the poor and middle income folks.
Do you actually want to understand? Serious question...
Yes, I do want to understand.
You made a claim, but what you offered as justification for that claim doesn't in fact support what you said.
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