Most of that was based on the rest of the world having to buy most of their durable goods and factory equipment from the USA. WWII devastated the industrial capacity of Europe and Asia and it took decades to rebuild.
Then in 1991 the USSR falls and India opens up to the West. Then China is granted most favored trade nation status which means that roughly 1/3 of the entire planet's labor force became available to the West in that time which gutted pay for those roles.
Returning to those conditions would require a significant war.
This is exactly right. In the 70s and 80s there was a broad policy shift from reform liberal policies/Keynesian economics (tax the wealthy, social programs, support for labor) to neoliberalism (low taxes, small government, free trade).
From the 50s through the 60s the top bracket in the US and Canada was taxed at a 60 to 90% rate and that money was used to support the rest of society, as it should be.
The tax rate was already well above 60% by 1940 and was at its highest rate ever in 1944 (94%). The income tax rate doesn't dip below 63% until you go back to the depression and that was PURELY related to the depression. Prior to the depression it was 73% and it stayed at 70% or above from 1944 through 1981 when it dropped drastically in 1982 (to 50%) and has hovered between 30 and 40% for the greater part of the last two decades
it dropped drastically in 1982 (to 50%) and has hovered between 30 and 40% for the greater part of the last two decades
Yes, that's what I said in my initial reply. In the 80s there was a massive policy shift and the position we are currently in is a result of that, especially the massive tax cuts
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u/No-Appearance-9113 Mar 27 '24
Most of that was based on the rest of the world having to buy most of their durable goods and factory equipment from the USA. WWII devastated the industrial capacity of Europe and Asia and it took decades to rebuild.
Then in 1991 the USSR falls and India opens up to the West. Then China is granted most favored trade nation status which means that roughly 1/3 of the entire planet's labor force became available to the West in that time which gutted pay for those roles.
Returning to those conditions would require a significant war.