Supply-side, slash and burn, trickle down, massive debt, deregulation that made the markets more like casinos, enormous fraud and corruption, and every other trick they've done to lay waste to the middle class since Reagan. Nixon tried to start the country on the road to plunder, but Reagan and and the Revolting Republicans of 94 - 2006 really got the ball rolling. And, we've been knocked around like tenpins ever since. This is well documented.
For more current data and analysis:
http://www.cbpp.org/http://www.ombwatch.org/http://www.epi.org/http://www.nationalpriorities.org/http://www.americanprogress.org/issues/domesticBut, folks have been pointing this out for years ...:
"The money power of the country will endeavor to prolong its reign by working upon the prejudices of the people until all wealth is aggregated in a few hands."
Abraham Lincoln, 1864
From 1996, Article at
http://scholar.lib.vt.edu/VA-news/VA-pilot/issues/1996/vp960623/06210479.htmRapid income increases among the richest of the rich and with a shrinking share of the economic pie for the poor have left the nation its most economically polarized since World War II, according to a U.S. Census Bureau report released last week.
The detailed look at American income trends since 1947 shows that poor and middle class families were getting a growing share of the nation's wealth until the mid-1960s, when the trend reversed.
By 1982, all progress toward equality in incomes had been wiped out. And since then, the gaps between rich and poor have widened.
State and regional figures, although not as up to date as the Census Bureau report, show the same trend in Virginia and Hampton Roads.
This may be good news for Tiffany's, but not for the nation. …
According to the Census Bureau, the richest one-fifth of American households saw their share of the nation's economic pie increase from 40.9 percent in 1970 to 46.9 percent in 1994. For the richest of the rich - the top 5 percent of families - the increase was even more dramatic. They brought home 20.1 percent of the nation's total income in 1994, up from 15.6 percent in 1970.
The share earned by the poorest one-fifth of families dropped from 5.4 percent in 1970 to 4.2 percent in 1994.
THE VIRGINIAN-PILOT, Copyright (c) 1996, Landmark Communications, Inc., Sunday, June 23, 1996
The political debate tends to revolve around taxes and tax credits as a way of redistributing income. Democrats generally favor increasing the capital gains tax, which affects the rich, and adding tax credits which would help poor families.
Republicans traditionally oppose increasing the capital gains tax, and some would like to do away with it. Their argument is that if the wealthy keep more of their money, it would be invested into the economy.
Robert Reich, President Clinton's labor secretary, has criticized the Republican economic agenda.
``There's an Alice-in-Wonderland quality to their logic,'' he said recently. ``Liberate the economy with deregulation and tax breaks for companies and the rich, they say, and all Americans will prosper. But the economy is already liberated enough to sprint merrily away from a majority of Americans. The problem is that wages are stagnant while profits surge - so how can higher profits be the whole solution?
``Something is going on here that's beyond politics,'' said Bruce Bartlett, a Senior Fellow with the National Center for Policy Analysis, a conservative public policy research organization. ``A lot of people have tended to draw the conclusion that we cut taxes in the 1980s, and the rich got richer. Here we've increased taxes in the 1990s, and they still got richer.''
However, the brief success this year of presidential candidate Patrick Buchanan, who raged against corporate excesses, pushed Republicans toward more of an acknowledgment of the problem. Bob Dole, the probable GOP nominee, addressed the issue in speeches in New Hampshire.
``Corporate profits are setting records and so are corporate layoffs,'' Dole declared. ``The bond market finished a spectacular year. But the real average hourly wage is 5 percent lower than it was a decade ago.''
From 1995, Gap in Wealth In U.S. Called Widest in West, By KEITH BRADSHER, NYTimes
http://query.nytimes.com/gst/fullpage.html?res=990CEED61430F934A25757C0A963958260&sec=&spon=&pagewanted=allNew studies on the growing concentration of American wealth and income challenge a cherished part of the country's self-image: They show that rather than being an egalitarian society, the United States has become the most economically stratified of industrial nations.
Even traditional class societies like Britain, which have inherited large differences in income and wealth over centuries, going back to feudal times, now have greater economic equality than the United States, according to the latest economic and statistical research, much of which is to be published soon.
Economic inequality has been rising in the United States since the 1970's. Since 1992, when Bill Clinton charged that Republican tax cuts in the 1980's had broadened the gap between the rich and the middle class, it has become more sharply focused as a political issue.
Many of the new studies are based on the data available then, but provide new analyses that coincide with a vigorous debate in Congress over provisions in the Republican Contract With America.
Indeed, the drive by Republicans to reduce Federal welfare programs and cut taxes is expected, at least in the short term, to widen disparities between rich and poor.
Federal Reserve figures from 1989, the most recent available, show that the richest 1 percent of American households -- with net worth of at least $2.3 million each -- have nearly 40 percent of the nation's wealth. By contrast, the richest 1 percent of the British population has about 18 percent of the wealth there -- down from 59 percent in the early 1920's.
Further down the scale, the top 20 percent of Americans -- households worth $180,000 or more -- have more than 80 percent of the country's wealth, a figure higher than in other industrial nations.
Beast on the Rampage, Bernard Wasow, The Century Foundation, 11/28/2007
http://www.tcf.org/list.asp?type=NC&pubid=1739"U.S. wage distribution is more unequal than other countries and we do less in terms of tax and transfer policy" to cushion the disparities, said Timothy M. Smeeding, an American who is director of the Luxembourg Income Study Project. Mr. Smeeding is preparing two papers drawing international comparisons of income.
And, while housing prices in the past helped the middle class stay afloat, that is no longer the case:
Rising housing prices have increased the holdings of the British middle class and limited the growth in inequality there.
The Republicans were wrong then, and they still are wrong, now:
Republicans have argued that the overall tax-cut provisions would reduce annual tax bills by roughly equal percentages for rich and poor. Democrats say that because the annual tax bills of rich Americans are much larger, reducing them by about the same percentage means that most of the money would go to the rich rather than the poor or the middle class, further concentrating wealth and income.
‘If we don’t tax, the government can’t spend’ laid to waste …Tax cuts lead reliably not to subsequent spending cuts. Remarkably, the evidence supports the opposite conclusion about government spending: following tax cuts, empirically, government spending increases.
When conservatives abandoned their traditional commitment to balanced budgets in 1981, they required a set of ideas to justify their new commitment to tax cuts over fiscal orthodoxy. The first rationalization they offered—the claim that the economy would respond so vigorously to tax cuts that revenues actually would rise—did not stand up to the facts. So a new justification was devised: tax cuts would “starve the beast” of big government, forcing legislators to follow tax cuts with spending cuts in order to avoid fiscal chaos.
As Ronald Reagan put it in 1981, “Over the past decades we’ve talked of curtailing government spending so that we can then lower the tax burden. . . . Well, you know, we can lecture our children about extravagance until we run out of voice and breath. Or we can cure their extravagance by simply reducing their allowance.” (Ronald Reagan, Address to the Nation on the Economy, February 5, 1981)
The claim that tax cuts will force spending cuts logically contradicts the extreme supply-side argument that tax cuts will increase revenues (which was being made simultaneously in 1981). Few reputable economists ever subscribed to extreme supply-side economics, and evidence against it is so overwhelming that almost nobody in the “fact-based community” still asserts it. Instead, the “starve the beast” rationalization has become a standard defense of tax cuts.
Now, after a quarter century of fiscal mischief, during which the debt/GDP ratio has been pushed up more than forty percentage points under presidents Reagan, Bush 1, and Bush 2, this rationale for unilateral tax cuts has been reduced to shambles as well.
Going Nowhere: Workers’ Wages since the Mid-1970s
Century Foundation
http://www.tcf.org/Publications/EconomicsInequality/wasow_nowhere.pdfIn the late 1990s, many observers hoped that we had finally broken free of the
slow income growth that had bogged down the American middle class for more
than two decades. Unfortunately, experience since 2000 suggests that the long
period of stagnant wages is dragging on. In marked contrast to the 1947–74
period—when wages for almost all workers were rising steadily and faster than the
inflation rate—average wages after the mid-1970s failed to grow consistently (see
Figure 1, page 2). Household incomes continued to rise somewhat fitfully over that
period, but only because family members were working more hours. The broadly
shared surge in incomes from 1996 to 2000 petered out almost as quickly as it had
begun.
What is more, with health care costs rising rapidly, employers have controlled the
growth of total compensation (which includes fringe benefits) by cutting back on
employee health care coverage. Figure 2 (see page 2) shows that, as with average
wages, total compensation levels are just slightly higher than they were fifteen
years ago.
(snipped)
The efforts of workers to improve their prospects are remarkable. Over one
generation, those who never attended college went from the great majority to a
minority of workers. As wages were falling for men with relatively little education,
men sought to increase their educational attainment. Women, on average, did even
more to improve their educational attainment.
Unfortunately, that investment of time and money in education has not enabled
workers to do any better than match their parents’ income. For example, a
substantial portion of men who have had a few year years of college will earn less
than their fathers did, even though they are better educated than their fathers
were.
In the 1990s, stable fiscal and monetary policies encouraged high rates of private
investment, and wage and income growth picked up. Since 2000, however, huge
public sector deficits and international instability appear to have derailed that
progress. But the United States is a resilient nation, and it is well within our
capacity to bring back sound fiscal policy and greater financial support for
education and training—policies that have proved to be effective at boosting
incomes across the board.
http://en.wikipedia.org/wiki/Supply-side_economicsThe extreme promises of supply-side economics did not materialize. President Reagan argued that because of the effect depicted in the Laffer curve, the government could maintain expenditures, cut tax rates, and balance the budget. This was not the case. Government revenues fell sharply from levels that would have been realized without the tax cuts.
- Karl Case & Ray Fair, Principles of Economics (2007)
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