It was easy to take our good fortune for granted. There were still problems, of course, including a somewhat stressful period between school and full-time employment when grocery shopping could become challenging; but our middle class was strong in 1967. We would marry, buy a house with a Veterans Administration no-money-down mortgage, and start a family at a time when one person working could support all of this. I took a year off when our daughter was born, and then chose to go back to work; but most of my married friends were stay-at-home housewives.
A simple graph arrived in a newsletter recently, and it hit home. It tracked the percentage of young adults aged 19-24 living with their parents from 1930 to 2020. 48 percent of them were at home with mom and dad during the Great Depression. That percentage dropped to 29 percent by 1960; but 47 percent of young adults were back at home with their parents by 2018, and we would reach 52 percent during the pandemic. We are again experiencing a Great Depression level of dependency. We can’t be too surprised, then, that fewer of our young adults are attending college, fewer are marrying, and our birthrates are down — or that our level of income inequality has also reached a Great Depression level.
It could be difficult to conceive of this, though. Our top marginal income tax rate was 70 percent during those good times. It had been even higher as we were paying off our WWII debt, but our wealthy seemed to be doing okay. Our economic growth rate was averaging 3.9 percent annually then.
Tax cuts are understandably appealing when we’re stressed financially. We’ve been electing more Republicans since 1980, but tax cuts haven’t made up for wages that have stagnated for decades. Income inequality has been growing worldwide, but our United States has become an outlier. A 2018 study by the Organization of Economic Cooperation and Development has found that our top 1 percent holds 32 percent of our nation’s wealth; and our top 10 percent holds 70 percent of it, leaving relatively little for the bottom 90 percent of us.
We are beginning to move in a positive direction. The elimination of employers’ noncompete clauses will make it easier to change jobs and get ahead, and wages are beginning to move up. President Biden’s financial assistance during the pandemic and his Executive Order to Promote Competition in the American Economy are reclaiming a long tradition of opposition to economic consolidation into the hands of a few.
American businessmen had consolidated wealth into trusts during the late 1800s, and lawmakers who complained that the system was rigged were called “socialists.” A healthy economy that works for everyone was their primary concern, though. Competition is fundamental to capitalism. It enables an economy to thrive, and their priority was the restoration of our economy and capitalism in America.
President Theodore Roosevelt became a leader of the Progressive Movement and championed the Square Deal. President Franklin Delano Roosevelt gave us the New Deal, and President Biden gave us his Executive Order to Promote Competition in the American Economy and reminded us that “capitalism without healthy competition isn’t capitalism, it’s exploitation.”
Sixty percent of our economy consists of consumerism, and living wages do make a difference. We might recall that President Clinton raised both wages and marginal tax rates in 1996. We not only reduced our deficit, we achieved a 4.7 percent annual GDP growth rate by 1999. We have not seen this level of economic growth or an annual rate of 3.9 percent since.
Republicans passed the Financial Services Modernization Act of 1999, which President Clinton signed following his impeachment trial and before leaving office. With the protections of the Glass Steagall Act eliminated, our mortgage crisis loomed on the horizon. President Bush also cut taxes in 2001; By 2008 our debt had nearly doubled, and we faced 8 years of recovery from our Great Recession.
But in spite of the challenges we faced, we might recall that our economy grew more and more jobs were created during the last three years of Obama’s presidency than during President Trump’s first three years. That is less likely since we were advised otherwise, but the Trump administration will be remembered in our history books for its unprecedented level of prevarication. We did have more tax cuts in 2017, but corporations and our wealthiest would benefit most.
These are trying times; but at some point real results must matter. Recalling Ed McBroom’s experience could be helpful, too. This Republican state senator and devout Baptist farmer from the upper peninsula of Michigan led an 8-month long investigation of Michigan’s 2020 election and reported, “There is no evidence presented at this time to prove either significant acts of fraud, or that an organized wide-scale effort to commit fraudulent activity was perpetrated in order to subvert the will of Michigan voters.”
For good measure, the senator also known as “Choir Boy” added, “The Committee strongly recommends citizens use a critical eye and ear toward those who have pushed demonstrably false theories for their own personal gain.” McBroom’s investigation was then described by our past president as “a cover-up for getting out of an audit,” and that’s the nicer part. McBroom is now receiving death threats and fears leaving his family at home alone as he drives to the capital many miles away.
Working together in a democracy is and clearly always has been in our best interests. The American Dream may still exist for the more fortunate among us; but the opportunities my husband and I enjoyed are available to far fewer of our young adults today. Let us move in a positive direction for our next generation. We will all be better off for it.
Carol Voyles lives in Easton.