The Twinkie Manifesto By Paul Krugman | nytimes | Published: November 18, 2012 Excerpts: The demise of Hostess has unleashed a wave of baby boomer nostalgia for a seemingly more innocent time. Needless to say, it wasnt really innocent. But the 50s - the Twinkie Era - do offer lessons that remain relevant in the 21st century. Above all, the success of the postwar American economy demonstrates that, contrary to todays conservative orthodoxy, you can have prosperity without demeaning workers and coddling the rich. Consider the question of tax rates on the wealthy. The modern American right, and much of the alleged center, is obsessed with the notion that low tax rates at the top are essential to growth. Remember that Erskine Bowles and Alan Simpson, charged with producing a plan to curb deficits, nonetheless somehow ended up listing lower tax rates as a guiding principle. Yet in the 1950s incomes in the top bracket faced a marginal tax rate of 91, thats 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 Squeezed between high taxes and empowered workers, executives were relatively impoverished by the standards of either earlier or later generations. In 1955 Fortune magazine published an essay, How top executives live, which emphasized how modest their lifestyles had become compared with days of yore. The vast mansions, armies of servants, and huge yachts of the 1920s were no more; by 1955 the typical executive, Fortune claimed, lived in a smallish suburban house, relied on part-time help and skippered his own relatively small boat. Today, of course, the mansions, armies of servants and yachts are back, bigger than ever - and any hint of policies that might crimp plutocrats style is met with cries of socialism. Indeed, the whole Romney campaign was based on the premise that President Obamas threat to modestly raise taxes on top incomes, plus his temerity in suggesting that some bankers had behaved badly, were crippling the economy. Surely, then, the far less plutocrat-friendly environment of the 1950s must have been an economic disaster, right? Strange to say, however, the oppressed executives Fortune portrayed in 1955 didnt go Galt and deprive the nation of their talents. On the contrary, if Fortune is to be believed, they were working harder than ever. And the high-tax, strong-union decades after World War II were in fact marked by spectacular, widely shared economic growth: nothing before or since has matched the doubling of median family income between 1947and 1973. Which brings us back to the nostalgia thing. There are, lets face it, some people in our political life who pine for the days when minorities and women knew their place, gays stayed firmly in the closet and congressmen asked, Are you now or have you ever been? The rest of us, however, are very glad those days are gone. We are, morally, a much better nation than we were. Along the way, however, weve forgotten something important - namely, that economic justice and economic growth arent incompatible. America in the 1950s made the rich pay their fair share; it gave workers the power to bargain for decent wages and benefits; yet contrary to right-wing propaganda then and now, it prospered. And we can do that again. http://www.nytimes.com/2012/11/19/opinion/krugman-the-twinkie-manifesto.html?hp&_r=0 ..... Again, the road is before us and it is spelled out clearly that in order to recoup the nations losses we need to create jobs and have faster growth. In order to achieve this we need to unload the Bush Tax Cuts for the wealthy while keeping them for the middle class. We need to overhaul the tax codes the rich pay, getting rid of loopholes, perks, incentives that allow the wealthy to pay lower tax rates than the middle class. That is socialism enabling the rich to get richer while the middle class gets poorer. Congress is corrupt and works only to become rich, do a little insider trading, get payoffs for favors given to the wealthys interests, free medical insurance paid by the taxpayers, a host of travel expenses, donations toward their re-election is foremost on their minds, (not the work of the people) and then in their income tax pay lower rates and have more perks, deductions than the average worker. We need a tax hike on the wealthy immediately. An overhaul on the tax laws, with no extras for the rich. They should pay more for the 11 years of Bush Tax Cuts where they benefited so greatly so that our revenue coffers can give us the means to create jobs and promote faster growth. We also need unions to represent the workers, as we have seen what happens without proper representation with employers. It is now or never, if we do not accomplish this for the majority of Americans, we will be lost forever as a third world country; low wages, long working hours, with a one man leadership in place of Democracy.
very interesting article. Maybe it will work only if usa will put in jail for years executives who' ll try to evade taxes and will invade places like cayman, saint lucia, monaco etc. Anyway, I have read that obama wanted to raise marginal rate tax on top of 250k dollars a year from 33 to 39,6% and this was a big issue in the us elections. How this could be an issue? I mean, how many us voters earn more than 250k dollars a year? even if you earn 300k dollars a year you will pay only 3300 dollars more with this tax (not a big sacrifice for a 300k dollars earner). You should be really a rich person to oppose this tax. Or I have done mistakes with the calculation? P.S. sorry for my english, it's not my mother tongue
..... But it won't cover the deficit nor the national debt brought forward from the Bush Tenure. Plus we need to get funds to create jobs and promote growth neither of which the Bush Tax Cuts did from 2001 thru today, did they!!! We need funds to create jobs repairing our highways, bridges, tunnels, in order to boost the economy and bounce us out of the Bush Recession. The wealthy should pay for the BTCuts they received while Americans jobs went overseas, and unemployment became a fixture. Every day that the republicans in Congress deny a tax hike for the rich is another day they force the painful repercussions upon American workers' continued distress. Reagan, HW Bush, and GW Bush raised taxes on Americans every year...why the holdup now? Is there something different about a Democratic president that pre-empts a tax hike?
I was actually speaking to the general unfairness of asking the more well off members of the middle class to fund the endless bull(*)(*)(*)(*) thrust upon us by Demoncrabs and Republiturds, but I guess that went right over your head. Please, by all means ... keep taxing us and see how much we hate the rest of you when the dust clears.
Krugman's absolutely right. The greatest economic expansion and middle class boom happened when the highest tax rates were very high. Deficits as a percentage of GDP were comparatively lower too (what a surprise).
I'd say the idiots are those who still believe Krugman was advocating for a housing bubble, and not being the slightest bit facetious. Krugman's column in 2002 was accurately noting the economy was in big trouble, and there was nothing that could mask that other than to create another artificial bubble, like the stock market bubble he attributes to Greenspan in the same article. Perhaps he needed to use the sarc tag. http://krugman.blogs.nytimes.com/2010/04/05/me-and-the-bubble/
Raise everyone's taxes. We all should have a stake, and we all should be paying for the government entitlements that today's Americans want. Obama and Democrats won the elction, now let's have everyone paying for their vision equally.
