Thursday, June 22, 2006

From Class War to Crackup
The 1950s weren't the Golden Age that so many Republicans and cultural conservatives seem to believe they were. The perpetual fear of the Cold War, McCarthyism and the stifling cultural conformity it helped perpetuate, and the concentrated racial injustice of pre-civil rights America all cast shadows over the decade.

Nonetheless, the decade stands out to us now as a time when America was figuratively on top of the world, by a greater margin than anytime before or since. Politics in particular was almost unimaginably less contentious than is the case today: for most of the decade a moderate Republican, Dwight Eisenhower, sat in the presidency while moderate Democrats, led by Lyndon Johnson in the Senate and Sam Rayburn in the House, controlled Congress. The result was relative consensus, as the county committed to an interstate highway system of tremendous value, moved to respond to the non-military aspect of the Soviet challenge by massive new investments in education, and even took the first baby steps toward internal reform through the Supreme Court school desegregation decision, the Civil Rights Act of 1957 and other measures.

Why was it so much easier to find consensus and move forward 50 years ago than it is today? Paul Krugman has an answer, one that I've been thinking about for years: as more people found themselves in relatively similar economic situations, they also found much common ground in thinking about how America should act at home and in the world:

[F]or the past century, political polarization and economic inequality have moved hand in hand. Politics during the Gilded Age, an era of huge income gaps, was a nasty business — as nasty as it is today. The era of bipartisanship, which lasted for roughly a generation after World War II, corresponded to the high tide of America's middle class. That high tide began receding in the late 1970's, as middle-class incomes grew slowly at best while incomes at the top soared; and as income gaps widened, a deep partisan divide re-emerged.

Both the decline of partisanship after World War II and its return in recent decades mainly reflected the changing position of the Republican Party on economic issues.

Before the 1940's, the Republican Party relied financially on the support of a wealthy elite, and most Republican politicians firmly defended that elite's privileges. But the rich became a lot poorer during and after World War II, while the middle class prospered. And many Republicans accommodated themselves to the new situation, accepting the legitimacy and desirability of institutions that helped limit economic inequality, such as a strongly progressive tax system. (The top rate during the Eisenhower years was 91 percent.)

When the elite once again pulled away from the middle class, however, Republicans turned their back on the legacy of Dwight Eisenhower and returned to a focus on the interests of the wealthy. Tax cuts at the top — including repeal of the estate tax — became the party's highest priority.

As if on cue, I turned on C-SPAN for a minute this morning to see Rep. Phil Gingrey (R-GA) talking about the urgent need to repeal or limit the "death tax"--the federal levy on the estates of the rich that hits a vanishingly small--but politically powerful--percentage of Americans. (As of 2009, when the exemption rises to $3.5 million per individual or $7 million per couple, just 3 in every 1,000 Americans will pay any estate tax.) This is the same Congress that again shot down a proposed minimum wage increase in the Senate yesterday, days after voting themselves another pay raise. Given the country's mounting problems on fronts from debt and trade, to demographic transformation in the workforce and super-expensive entitlements, to foreign affairs and rising crime, I can't decide if this obsessive focus on further enriching the richest is more stupid or vicious.

Don't get me wrong: I'm not advocating a return to a top marginal tax rate of 91 percent, or suggesting that a program of massive income redistribution to get us back toward the "Great Compression" of the 1950s would be either feasible or successful. The country's economic hegemony of that decade was largely a function of having come through the war in vastly better shape than any of our notional global competitors, and the political factors--about a third of the private sector unionized in the aftermath of the Depression, some pressure to pursue equity as part of the ideological struggle against Communism--cannot be replicated. But what we have now is a government that looks at the issues of the country as if in a funhouse mirror. If the Republican Congress is to be believed, the most important concerns of the United States are amending the Constitution to ban gay marriage and flag-burning (of which one incident was reported in 2005), and ending a tax that the overwhelming majority of Americans would love to have to worry about.

No comments: