It’s hard to believe that the American Economy I grew up in was fairly stabile. The bank regulations put in after the fall of the stock market in 1929 and through a dozen years of depression, combined with the progressive economic support of WWII Veterans when they got back from defeating Japan and Germany, kept a much narrower separation of the rich and the poor and allowed people to rise much more easily in their levels of economic achievement. It’s what allowed my father, who came from a large, relatively poor family, get his college education, become a pharmacist, and develop a successful business in Connecticut.
Changes started to come into play with the arrival of the Conservatives and the election of Reagan… the charts show the split between rich and poor starting to increase in 1974.
In an article entitled “Surging wage growth for topmost sliver“, Lawrence Mishel points out this change in the economic spread:
Inequality in the United States continues to worsen. Huge gains at the top of the income scale have been fueled by, among other things, a surging inequality in wages (illustrated in the chart below). The ratio of the wage income of the top 1% of earners to that of the bottom 90% more than doubled between 1979 and 2006, increasing from a ratio of 9.4-to-1 to 19.9-to-1. In contrast there was relatively little change in the earnings disparity from 1947 to 1979, when wages at all levels of the economy grew apace.
As a result of the increasing earningdisparity, Obama, in his economic plan, has focused on the middle class, which has suffered the most here. Indeed, in a fairly happenstance discussion with a citizen during a campaign stop… a citizen who became known as “Joe The Plumber” … Obama suggested that the wealth of the country had to be redistributed a bit, to increase fairness.
This was jumped on by McCain/Palin, and by their major media voice at Fox News, as “Socialism”, a term that was repeated over and over by both candidates and friends at Fox. Governor Palin at a Rally on the 17th, for instance:
Sen. Obama said that he wants to spread the wealth and he wants government to take your money and decide how to best to redistribute it according to his priorities… Joe suggested that sounded a little bit like socialism.
Add to this McCain on a National Radio speech yesterday:
Barack Obama’s tax plan would convert the IRS into a giant welfare agency, redistributing massive amounts of wealth at the direction of politicians in Washington.
Or, as summed up by the LA Times this morning:
John McCain sharpened his attack on presidential rival Barack Obama’s economic proposals Saturday, accusing the Democrat of seeking to turn the United States into a socialist country and convert the IRS into a giant “welfare agency” that would dole out cash at Washington, D.C.,’s discretion.
Yet when saying about Obama “wants government to take your money and decide how to best to redistribute it”, McCain and Palin are ignoring the fact that for more than 30 years, Conservative Republican government, by eliminating regulations and lowering taxes on the top 1% of Americans, have been actively “redistributing” our money. They have simply been taking it away from the masses and given it to the millionaires.
But when it comes to the wage income of the highest of the high earners, the staggering gap has become a chasm: in 2004 the upper one-tenth of 1% earned 70.4 times as much as the average person in the bottom 90% of the income scale. Just 25 years earlier in 1979, the ratio that was only 21.0-to-1. In other words, in 1979 it took the highest-paid earners 12.4 days to make what most other earners did in a year, but by 2004 that feat was accomplished in a mere 3.7days.
In Calling Obama a “Socialist”. which he is not (George W. Bush is more of a “Socialist” by nationalizing 9 banks), McCain and Palin are trying to make Americans remember the years of “anti-American” propaganda attacking of Marxists and Communists (The Michelle Bachman statements to Chris Matthews the other night are a case in point), while ignoring the actual causes of our economic disaster… causes that McCain participated in as a deregulator.
It is unlikely that honesty will reappear on the Republicans’ part in the remaining 16 days.