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Posted by on May 25, 2016 in History, Politics | 2 comments

On this day … a commitment to science, technology and space

And humanity.

On this day, 55 years ago, President John F. Kennedy challenged Congress and Americans to think big, to look beyond the stirrings of conflict in the developing world, to “turn recession into recovery”, and to turn our eyes to the stars.

Unemployment was 7.1%, the peak of the recession.

And the recovery he led — a testament to Keynesian economics — was “the second longest economic expansion in U.S. history.”

Part of that recovery included investment in science and technology as well as a vision that captured the nation’s imagination:

I believe that this nation should commit itself to achieving the goal, before this decade is out, of landing a man on the moon and returning him safely to the earth. No single space project in this period will be more impressive to mankind, or more important for the long-range exploration of space; and none will be so difficult or expensive to accomplish… But in a very real sense, it will not be one man going to the moon–if we make this judgment affirmatively, it will be an entire nation. For all of us must work to put him there. (emphasis added)
~ President John F. Kennedy, 25 March 1961

What were key parts of Kennedy’s economic plan?

Wages

  • Extend the minimum wage to a larger pool of workers
  • Increase the minimum wage from $1.00 per hour to $1.15 immediately; $1.25 per hour within two years. And $1.15 in 1961 is equivalent to $9.20 today. Today’s federal minimum wage is $7.25; it was set in 2009 and that sum is equivalent to $8.09 today. In other words, someone making the minimum wage in 2009 would need to make $8.09 today to break-even.

Unemployment and eduction

Social net

  • Raise the minimum monthly social security benefit from $33 per month to $43 per month
  • Pay actuarially-reduced benefits beginning at age 62
  • Extend social security benefits to a larger pool of people
  • Extend disability insurance protection after a worker has been totally disabled for 6 months
  • Early payment of life insurance dividends to veterans of World War I and II

It’s deja vu, all over again

Does any of this sound familiar? It should, if you’ve been following the presidential nomination process.

Through the bulk of the JFK/LBJ expansion of the 1960s, the top marginal tax rate in the U.S. was 70%. Today it is 39.6%.

Today’s corporations pay an “average effective rate” that is “about the same” as the 25.5% paid by corporations around the world. That’s about half the corporate tax rate in 1961.

And this is the result:

Income Inequality, graphed;cbpp.org

The increase in income concentration since the 1970s reverses the prior, long-term downward trend in concentration.

 

We need a visionary to lead our country … someone who rejects more-of-the-same politics which have brought us to this place in time where the gap between the very rich and everyone else is wider than at any time since the Roaring 1920s … who brings people together rather than wields words as swords to set them upon one another.

 

:: Cross-posted from WiredPen
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  • Bob Munck

    Today’s corporations pay an “average effective rate” that is “about the same” as the 25.5% paid by corporations around the world. That’s about half the corporate tax rate in 1961.

    That’s an equivocal paragraph. Is 25.5% about half the effective rate in 1961, or half the marginal rate? If it’s the latter, the paragraph isn’t making any useful point.

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