Taxing The Rich Is What Saved The 20th Century

 Photo credit: AP Image/Atlantic

THE last century began with a bang! The first World War and then the Roaring Twenties. The 1920s was a captivating decade of gross economic growth across the entire Western world just after WWI but right before the Wall Street crash that caused the Great Depression in 1929. The 20s was a decade of new high-industrialization — the time when automobiles, telephones, radio, movies and electronic appliances of all kinds were first in their boom. The Dirty Thirties, on the other hand, was a complete disaster in comparison. Granted, there was still economic progress but it was nothing close to what it was the decade before. Two really important things happened during this dark time in history: First, there was a rise in Marxist thinkers — millions of people joined socialist and communist parties and then there was a steady rise in union membership. Second, the government stepped in to proportionately tax its most affluent citizens in order to budget for the war and more importantly for new social programs or the benefits that were going to be free of charge to its citizens.

In this article, I want to quickly show how over the past fifty years corporate forces and stale government counteraction has undermined everything that workers — courageous socialist workers — had made the government do after the Great Depression which is ultimately what got them out of the worst economic disaster in capitalism’s history. We’re transcending into an oligarchy that is preparing for a revolution, going down a very familiar dark path into tyranny, and we should all be preparing for a bank run or any of the other misfortunes that are on their way.

The Great Depression lasted from 1929 to 1939, and was the worst economic downturn in the history of the industrialized world. It began after the stock market crash of October 1929, which sent Wall Street into a panic and wiped out millions of investors.

History.com

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Vancouver Public Library

In 2017, most of the core New Deal schemes from the 20s and late 30s — which were a series of laws implemented during the both world wars in the United States to aid social suffering — have been removed. They were nullified by several different politicians during the decades following WWII, leaving us with the predicament that we’re stuck in. The manufactured fear of communism, the whole red scare era — all of that fear was created by governments and corporate media to the breakdown of the working class and the tax policies which redistributed wealth enough to provide to for social programs that we’re dependent on now. Of course, they weren’t directly publicized that way but that was their end result. These days, with systems like austerity in broad acceptance, the bankers — not politicians — are in control of how the economy is being run. The market rules everything.

Bankers do not like protests about the economy or about controversial issues which point out the corruption. During the 30s politicians were able to enact real steps forward (the Second New Deal) which really did change society by taking over control over the banks because of the amount of unemployment and activism. Workers were calling for a change, they wanted to take over the factories, so the President made sure there were jobs in the public sector if the market didn’t provide. However, all of this progress has radically stopped in the iron light of the narrow-minded Cold War and in the modern day.

Early in the 20th century, during the worst economic downturn ever, there was a steady rise in union membership. Workers felt like they had to organize together in order to get through the tough times of the depression. Graph #1 shows from 1910-2010 and was published in November 2015 by Ewan McGaughey from King’s College London. The source is BLS (US Bureau of Labor Statistics.) The blue line shows that in the depths of the 30s when the crash happened, it really didn’t start to recover until the 80s. The membership of unions is the red line and it shows a rise beginning in the late 30s, plateauing from the 50s to 80s, peaking in the 80s, and it crashing ever since.

United_States_union_membership_and_inequality,_top_1%_income_share,_1910_to_2010
SSRN
IB-union-membership-2013-chart-1_600
The Daily Signal

Graph #2 is for comparison, showing 1930-2012 and it was published in 2013. Unlike graph #1 it shows a percentage of the population instead of actual numbers. This second graph also does not show the income share of the top 1% like the graph #1 does. Its source is the US Department of Labor and the BLS (the same source as graph #1). Clearly shown, starting in the mid-30s there was a steady increase in union membership that hit its peak or a plateau in the mid-1940s. However, here is when the shape looks very different. We could argue that today the union membership is either: About where it was at the beginning of the 1950s based on the numbers, or it is where it was just before 1935 when the National Labor Relations Act was made law, based on the percentage. Where the US government got these numbers would be nice to know because they really do seem peculiar since the source is the same. Ever since the 1980s, on both graphs, there has been a steady decline in union membership — this is for sure.

Taxing the rich used to be an actual solution but during the Cold War there was a steady decline in taxes. This graph is really important because it shows how much people were getting taxed in the 40s to now. Pay attention to the fact that the richest people have had their taxes gone down from at least 70 per cent down to 40 per cent.

falling_tax_rates
MotherJones

Below I have highlighted the top tax brackets from 1930 until 2013. All of these numbers are nominal, meaning that they “measure the dollar value of a product at the time it was produced. Real prices are adjusted for general price level changes over time, i.e., inflation or deflation.” So it’s exactly the same amount of money that we make today, conveniently adjusted already over time. In the red boxes shows that from 1945-1960, the wealthiest citizens paid over 90 per cent in tax. By the time Reagan became President taxes were at 70 per cent. When he left office, taxes for were at 28 per cent. Throughout the 90s until now, the wealthiest citizens haven’t paid more than 40 per cent.

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Does joining unions work? Does taxes the rich make everything better? Of course not but without looking past the doctrine of managerial or market capitalism, the system always stays sort of slave-based by workers being told what to do and it will continue to be ruled by plutocrats inefficiently. Without protesting the economy on a regular basis during the past decade when millions of people lost their homes and jobs — like what was done during the Great Depression– we have forgotten the true definition of activism. We are passive towards inflation of the dollar, with the market, with higher prices for essentials like transportation, housing, and rent — we’ve totally disconnected.

We accept stagnant wages for the masses as everything costs a little bit more as long as we can shut ourselves away from the pending terrible catastrophe. This is the kind of world we want to leave our children? One which relies on privatization and low union membership, coupled with worsening inequality leading to powerful billionaires who pay no taxes and a business cycle which fails every ten years? A society where austerity measures lay off more and more poor workers, every single time. Is this normal and okay? Well, it’s all that we’ve got for now I guess. What I wonder is: Would the workers from the 20th century have been alright with these austerity measures like we are? I don’t think they would have. I think they would of rioted.

American_Communists
Union Square, NYC / Conservapedia

In the 21st century, there aren’t many answers to find, only lots of questions. I don’t think any of this will be solved anytime soon because there are too many things for everyone to concentrate on. Self-expression is all about satirizing reality and not really connecting with other people or on what’s happening to workers or in the economy. Apart from the few protests like the Occupy movement in America, Arab Spring in the Middle East and Africa, and Cereza in Europe, there is only protest about social or cultural aspects of society. There’s no alternative to our system. We accept our corporate overlords. If we’re not high on illegal drugs, we can just get drunk or get prescribed an opioid to keep ourselves going along with what is happening outside. Other people will dive into a hobby or a second job, some will become total freaks on the internet with a community of a couple thousand, but all of that is okay as long as they’re not united or concentrated.

We’re numb to destruction. Constantly bombarded with our personalized possessions, our social media bubbles, the new facts and fears that we learn every day; and our inability to latch onto anything with any real feeling anymore. The system that was created a hundred years ago has led to the pale, bail-out fixes that our leaders provide and then disguise as some sort of change. Most people subdue to the passive aggressiveness but continue to ignore the sacrifice of many for the accomplishments that we now find normal — like the free, national benefits that we all receive because of American, Canadian, and much more communists around the world in the 20th century.

Socialism is more than just the simplification of tyranny in the 20th century. What some parties have done in the name of Marx is horrible — for example in the Soviet Union, especially during Stalin’s time. Marx’s ideas of socialism leading to an eventual communist society are more than just the 20th century past of countries like Russia. Communism inspires so much more people than revolutionary, anarchist, terrorists — it led to all of the true progress in the 50s and 60s in the West because of the workers joining communist parties and trade unions to force their governments to change society. Young people should always remember this: Things have changed and Westerners have freedoms like never before, workers expect more now and are smarter because of the internet, we know what we want and we want to be in control again, but we can’t forget what happened or take for granted what radical communists have done for the world.logo


Make sure you also check out:

Visualizing Individual Income Taxes
The Devious Funnel of Wealth

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