In a 1992 CBS poll 75 percent of those surveyed called themselves “middle class.”
World War II “To American production, without which this war would have been lost.” Joseph Stalin American factories turned out 86,000 tanks, 2 million army trucks, 193 artillery pieces, 17 million handguns and rifles, and 41 billion rounds of ammunition. Most amazing of all, the U.S. built 300,000 planes. Women entered the workforce, more than 5 million between 1941 and 1945.
Industrial Output Ford built a massive plant at Willow Run Michigan that produced 8,524 B-24 bombers. A Boeing plant produced a B-17 bomber every ninety minutes at its peak in 1944.
Growth of the Middle Class The GI Bill After World War II the United States was the economic engine of the world – producing 52 percent of the World’s goods. Levittown expansion of the nation’s housing stock
The Era of the Middle Class Home ownership increased from 44% in 1945 to 62% in 1960. (in 2000 it was 62%) For the first time in history a majority of Americans graduated from high school. Enrollment at Colleges and University more than tripled, from 2.6 million in 1949 to 8 million in 1969.
Focus on Civil Rights 1955-1965 Civil Rights Movement On December 1, 1955 Rosa Parks refuses to give up her seat and move to the back of the bus Sit-in at Woolworth lunch counter in Greensboro, North Carolina (four freshman from North Carolina A&T College) February 1, 1960. Freedom bus ride May 4, 1961 The Nation’s eyes were exposed to the treatment of Blacks in America In 1964 23% of voting age Blacks were registered to vote. Voting Rights Act passed August 6, 1965. By 1969 61% of voting age Blacks were registered to vote.
I am not satisfied until every American enjoys his full constitutional rights. If a Negro baby is born, and this is also true for Puerto Rican and Mexicans in some of our cities, he has about ½ as much change to get through high school as a white baby. He has about 1/3 as much chance to get through college as a white student. He has about 1/3 as much chance to be a professional man. About ½ as much chance to own a house. He has about 4 times as much chance that he will be out of work in his life as the white baby. I think we can do better. I don’t want the talents of any American to go to waist.
Nixon and Ford End of the Great Society New malaise Jimmy Carter High inflation 13.5% high Interest rates – prime interest rate for banks reaches a high of 21.5 %
Triumph of Conservatism The dawn of the Era of the Wealthy Class Tax policies Economic Recovery Tax Act Top personal tax rate from 70% to 50% Capital gains rate from 28% to 20% Cut domestic spending $140 billion Increase defense spending $181 billion
Laffer Curve 100% tax rate, why bother Lower rate, more economic activity, greater base to tax. If you cut taxes, you increase economic activity, producing a larger base to tax and thus more income.
History of Tax Cuts [structure of taxes] Estate Tax Cuts here benefits WealthyPropose elimination Dividend TaxCuts here benefits WealthySubstantially cut Capital Gains TaxCuts here benefits WealthySubstantially cut Income TaxCut on top rate benefits Wealthy Medicare/Medicaid TaxCuts here benefit Middle Class and Poorincreased Payroll TaxCuts here benefit Middle Class and Poorincreased Excise TaxCuts here benefit Middle Class and Poorincreased
Measuring Inequality Change in Family Income Inequality, 1947 to 2000 Percent Change in Gini Index vs. 1968 Source: www.census.gov/hhes/income/histinc/f04.htmlwww.census.gov/hhes/income/histinc/f04.html
The Rise and Fall of the Middle Class During the modern industrial age, the middle class grew steadily, reaching its heyday in the 1950s, when its numbers soared into the tens of millions. According to a study commissioned by the U.S. Census Bureau, middle-class people inhabited great swaths of North America, with settlements in the Great Plains, the Rocky Mountains, the Pacific Northwest, and even the nation's urban centers. "No one predicted the disappearance of the middle class," said Dr. Bradford Elsby, a history professor at the University of Pennsylvania. "The danger of eliminating workers' unions, which had protected the middle class from its natural predators for years, was severely underestimated. We believe that removal of the social safety net, combined with rapid political-climate changes, made life very difficult for the middle class, and eventually eradicated it altogether."