Excerpts From _Back When America Was Socialist_

The Golden Age of American Capitalism (1950s and 1960s)

• Overview: The period between 1950 and 1970 characterized as the Golden Age of American Capitalism

• Survey Data: A survey by NYTimes Morning Consult on Americans' feelings about greatness over decades - results skewed towards the 1950s and 1960s for those born before, and the 1980s for those born afterward.

• Qualitative vs. Quantitative Values:

  • Scholars reference economic growth.

  • Americans refer to socioeconomic aspects: respect, prosperity, a robust middle class, and structured family life.

Economic Context

• The Golden Age: Marked by a rise in real income averaging 4.4% per year from 1950–1970. Comparatively low growth rate of 2.1% from 2000–2020.

• Entry to Middle Class: Many Americans found a path to the American Dream - steady jobs, home ownership, family life, leisure.

• Blue Collar Labor:

  • Considered skilled, typically does not require a college degree.

  • Examples include construction, mining, and technician work.

  • During this period, blue collar jobs provided sustainable family incomes amid productivity booms.

• Labor Market Shift:

  • Goods-producing labor constituted ~40% of workers, reduced to ~16% today as a shift towards service-sector jobs occurred.

  • income rising a bit every year

  • increase annual wages because of inflation

Middle Class and Inequality

• Strong Middle Class:

  • Median income capable of supporting families and providing luxuries. Contrast with the current struggle of the median income to support families.

  • Reports highlight the shrinking middle class and its implications on society.

• Impact of Education:

  • Those with high school diplomas faced significant shifts into lower-income sectors from 1971–2015.

  • Expansion in professional sector income contrasted with stagnation in middle-class income.

• Innovation and Global Standing:

  • Space race and other technological advancements contributed to American pride and progress.

  • Innovations from war contributed to rising standards of living.

Social Struggles

• Civil Rights Movement:

  • Acknowledgement that many struggled during this era, particularly African Americans.

  • Civil Rights Act of 1964 was a significant, albeit belated, milestone following much suffering.

  • Legacy of slavery and systemic inequality persists, hindering economic opportunities for black communities.

Government Policies and Their Effects

• Role of Government:

  • Government involvement was crucial in fostering a strong middle class through labor protections and welfare spending.

  • Taxation of the rich kept levels of wealth from creating stark divisions.

• Tax Structures:

  • Highest marginal income tax were 91%, average at 50%, gradually decreasing to 70% in the 1960s.

  • Current max tax at 37% results in greater income inequality.

  • The median income earner in 1960 paid about 22% in taxes; median today pays roughly 10.8%.

• Corporate Taxes and Investment:

  • High corporate tax rates (around 50%) encouraged employee reinvestment and growth which contradicted views on tax hindering growth.

  • Studies show high inequality impacts economic growth negatively, suggesting required equality encourages long-term growth.

Labor Unions and Workforce Dynamics

• Labor Unions:

  • Grew throughout the Golden Age, peaking in the 1970s.

  • Acted as a crucial negotiating force for wage increases and worker rights.

  • Helped maintain middle-class status for blue-collar workers.

• Technological Innovation:

  • Gov't funding facilitated R&D which boosted efficiency and productivity.

  • The benefits of increased productivity were more evenly distributed among workers due to union influences.

Welfare Programs and Social Safety Nets

• Welfare Expansion:

  • Enhancement of the welfare system established in the 1930s (Social Security Act).

  • Medicare and Medicaid established in 1965 aimed at supporting the elderly against poverty risks.

  • The era coincided with other countries adopting forms of universal healthcare.

Conclusion and Future Implications

• Reflecting on Policies:

  • Advocating for a return to policies of the 1950s and 60s could mean endorsing stronger worker protection and higher taxes on the wealthy.

  • Current societal divisions challenge the notion of returning to past policies.

  • Discussion of potential support for democratic socialism among the populace reveals a complex current political landscape.