The United States of America – A Graphic Narrative of Recent Socioeconomic Trends

[Graphs/images taken from a number of sources; all graphs/images are for educational purposes only]

During the post-World War II boom, economic growth was spread fairly equitably across the different income groups.  The economic philosophy most commonly followed during this time came from John Maynard Keynes, who believed that governments must practice deficit-spending, especially in times of recession, in order to promote full-employment. Keynesian economic philosophy influenced FDR’s New Deal programs and promoted the idea of government stimulus programs to create jobs.

From 1979 to the present day, the economic growth has mainly benefitted families with incomes over $75,000, particularly the richest 20% of the population.  During this same time period, the top tax brackets have seen their tax rates drop.  The main economic philosophy practiced by politicans, particularly Ronald Reagan, came from Milton Friedman and his seminal work Capitalism and Freedom. This supply-side theory promotes free enterprise and followers believe that government interference is ineffective and unnecessary (e.g. flat tax is better than progressive tax, government should not create jobs, etc…).  The only problem is that in practice this theory has been a failure for the bottom 80-90% of income earners (i.e. the vast majority of Americans).

[taken from the Center on Budget and Policy Priorities]

If we focus on the growth of the wealthiest Americans, the income growth disparity is even more pronounced.  During the past thirty years the richest 1% saw their incomes increase by 232%, compared to a very modest 10% increase for the bottom 90%.