A Blank Spot on the Map

Saturday, November 10, 2012

Post to CH

1930 was supposedly the changing point when things went bad.... to me that looks like when things took off for the better allowing those of us born into the great economy of the 50's and 60's to wax poetic about the 20's and earlier times.... when grandpa just died at home if he couldn't afford treatment.

http://ablankspotonthemap.blogspot.com/2012/11/prepost-1930-gdp.html

This is clearly about chosing an ideological perspective and view of the world over a pragmatic approach to it. MOST of us reject the ideological view not on a whim but on sound evidence, logic and look back through history.


But alas Jamie IS right.... we've heard this all before. In 1933 the very people who's ideology crashed the economy then told us how grim an FDR future would be. They were relentless as they are now. We went on to grow the strongest economy the world had ever seen. The middle class blossomed and upward mobility was the norm. Then 1981 happened. THAT is what changed. A distinct policy change and a rise of anti-government sentiment. After the 1930's GDP skyrocketed and debt to gdp came consistently down. Then after 1981 debt to gdp skyrocketed and GDP has fallen off. The problem has nothing to do with too much spending it has to do with financialization of our economy and massive rises in income inequality. Fix our finance system and increase middle class wages and we will move on. Obama is far more likely to pursue those polices and that is the basis of my optimism. My pessimism rises from the incredible power of the banks to fill fallen wages with subsidized financed debt and then to get bankruptcy laws changed such that a person could have 25% of their future earnings INDENTURED to the banks.

By your definition of taxes ...1918 and 1919 fits pretty close. But your definition misses the fact that the tax burden WE place on the future is in big part because WE cut our own real tax rates as the chart you reference shows. Had the effective federal tax rate been just 2% higher since 1980 we'd have almost NO debt.

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