Twinkie Nostalgia

The demise of the Twinkie, Paul Krugman writes, has unleashed a wave of nostalgia for the 1950′s — a world many conservatives think of as a Golden Age. But, Krugman writes, the economic policies of the ’50′s were a lot different than the conservative prescriptions for our time:

Yet in the 1950s incomes in the top bracket faced a marginal tax rate of 91, that’s right, 91 percent, while taxes on corporate profits were twice as large, relative to national income, as in recent years. The best estimates suggest that circa 1960 the top 0.01 percent of Americans paid an effective federal tax rate of more than 70 percent, twice what they pay today.

Nor were high taxes the only burden wealthy businessmen had to bear. They also faced a labor force with a degree of bargaining power hard to imagine today. In 1955 roughly a third of American workers were union members. In the biggest companies, management and labor bargained as equals, so much so that it was common to talk about corporations serving an array of “stakeholders” as opposed to merely serving stockholders.

From 1947 to 1973 median family incomes doubled. Since that time they have remained flat.

The problem with modern conservatism is that its memory — like its clientele — is highly selective. The 1950′s was a difficult time. It was the time of the McCarthy witch-hunts and the time when school children were advised to “duck and cover” in case of nuclear attack.

Modern conservatives live in an imaginary world — a world which was not as they imagine it — and a world which is not as it is.

Author: OWEN GRAY