Whiskey Bar: Building a Bridge to the 19th Century
It’s funny to see the Journal suddenly decide that the “Two Americas” merits front-page coverage – much less an implicit admission that the growing gap between rich and not rich is an economic problem in and of itself. Last year, when the paper noted the same trend, it was with a completely neutral sigh of relief that the “recovery” was finally on track.
Long (as Billmon posts usually are) but informative post on the “Two Americas” with some historical perspective and analysis. The trade-offs between the Old Deal and the New Deal are interesting: never learned that stuff in my college econ classes.
All told, real wages dropped 17% between 1972 and 1992. I’ve often wondered what the political fallout would have been if that same decline had been administered the old-fashioned way – through direct pay cuts by employers instead of the gradual, indirect erosion of inflation. Who knows? Instead of Ronald Reagan, we might have gotten an American Lenin.
17%?