Adjusted for inflation median income for men was lower in 2010 than in 1970. In 2010 $36,676 while in 1970- $36,838. Thats right guys, we haven't even been able to keep up with inflation, we haven't had a raise in 40 years. Do you have it in your heart to label this class warfare?
As a reminder, it started when the Taft Hartley Act was passed, watering down the strength of the Wagner Act which was passed during FDR's first term and gave unions the right to collective bargaining. The Assault on middle and working class families became a multi pronged effort with the PATCO strike and when tax breaks for outsourcing were started during the 1980's.
One result of downward wage movement over decades is that FICA payments made to Social Security are minimized. Looking at the flip side, we know that the richest have gotten richer, which is a recipe to increase wage disparity. Wage disparity is so severe that it is now acting as a brake on demand.
We are now there.
My very first diary here @ D-Kos on November 26th, 2006, provides these 2 quotes:
A War on the Middle Class generally attacks the 3 pillars holding up the middle class. Progressive taxes, labor & education.
The current war on the middle class started with less progressivity in tax rates, then union busting. More recently, tax breaks for corporations to move our jobs overseas, increasing illegal immigrantion to enlarge the labor pool, which drives wages down. The Bush Jr. tax policy is regressive while Bill Clintons tax policy was much less regressive and was moving to true progressivity.
By January 2010 my thoughts had evolved:
Low tax rates like we've had since Reagan are still considered progressive, but they have a regressive effect, taxing the working poor and middle classes out of the economy, as a result families are less capable of taking care of their own, and more often than not rely on government hand outs.
When tax rates are high enough, the working poor and middle classes are engaged in the economy. The point is having a large and vigorous middle class that can participate as citizen legislators, send its kids to college, so those kids can invent lots of cool stuff for the corporations to make money off of.
And after 112 diaries, from my first Rec list diary:
The picture I'm trying to paint is one of incentives to the flow of capital...
High taxes should not be about punishing the rich. Hi taxes in the past were about creating a stable society, where smarter investments are rewarded. Those exemptions and deductions are a great way to make capital flow where we want it to, instead of willy nilly everywhere, or not at all, like we see now. The right wing likes low taxes with fewer exemptions and deductions to "level the playing field". But what that does is make currency and commodities speculation more profitable than say building factories that produce solar panels and create US jobs......
These high rates also allowed for less of a tax burden on working and middle class families, engaging working and middle class families in the economy, and these families were better able to take care of their own. Nowadays, the tax burden on working and middle class families have taxed them out of the economy.
The process of proposing solutions.
First we must look at the scale and nature of the problem and then propose solutions that are scaled properly to achieve the desired effect. Comparing metrics from the Depression to today can provide us with some generic sense of scale.
1) 3 tears of stimulus ('34-'36) was not enough.
2) GNP loses in the Depression were more severe than recent loses (20% to 4%).
3) Current unemployment might be three quarters as bad as it was at the peak of the Depression.
1) 7% of GNP wont do today, make it 8-10%.
2) 3 years wasn't remotely enough, make it 5 years.
Money spent to create jobs in energy and transportation infrastructure have a remarkably good stimulative effect, probably the best multiplier we can hop to see. 1 Billion spent can create 20,000 to 25,000 jobs. These jobs pay well, from 40k to 75k, and have excellent secondary job creation effects.
The new US Census report on page 58 of 95, table A-5 (pdf ! ) shows that of total workers, the median income of males in 2010 was $36,676, and in 1970 was $36,838. When looking at Male full time workers year round, median income in 2010 was $47,715 while in 1973-$49,065.
Alex, can I have jobs for the Daily Double?
3:53 PM PT: Is there I pie fight going on I don't know about? Its shameful that meta distracts people from a policy discussion. Anybody know how to herd cats?
5:14 PM PT: I guess today was not the day to write public policy diary. Incredible.