The Post WWII Boom

Are these views of seeing government as our ally and the progressive income tax as a necessary part of the picture just a pipe dream? In a nutshell, from the beginning of American history and through the Great Depression there was a progressive concentration of wealth in the hands of those we called Robber Barons – the captains of business and industry. It was a time of sweat shops, child labor, 72 hour work weeks for slave wages, ruthless private security forces like the Pinkertons and violent union busting, no health or safety regulations, no retirement programs, … Then as now all attempts at reform were labeled socialist or communist which we were taught to hate and fear from our earliest schooling. Yes, even back into the early 1800s these fears were fostered to solidify the power of the wealthy.

It took the Great Depression and World War II to finally make public regulation restricting the Robber Barons so necessary that all their wealth and power could no longer buy taxes and regulation off. Things began to change for the better, but we’ll come back to the abuses of the Robber Barons later.

The decades following World War II were a boom time. The country was thriving. The middle and lower classes were gaining ground rapidly. Unemployment was almost non-existent. Incomes were all steadily rising as was production. People could afford not only cars, homes, schooling, and health care, but a growing list of amenities and conveniences. This was accomplished by single-income families for the most part. Savings rates were at an all time high. That enabled us to make huge investment in business and industry,…plants, machinery, R & D,… on the private side.

Taxes were in the 90% range at the highest and our governments could afford much of the enormous investment in our common infrastructure on the public side: The Interstate Highway System [$425 Billion dollars adjusted for inflation for the 42,700mile highway system alone], air ports, sea ports, the ships of the merchant marine, schools, libraries, national defense, … Inter-related, the private and public sectors grew along side of each other and reinforced each other. Social Security and retirement systems were being fully funded. Health care for the majority was increasingly available and affordable. Immigrants were flooding into the country and making a welcome contribution to our economy. And perhaps most importantly there was plenty of capital to invest in our own growth plus rebuilding war-torn Europe and Asia through the Marshall Plan. Yes, there were problems but we were not only making economic progress but also in the fields of civil rights for minorities and women, civil liberties, health and safety, ,…clean air and clean water, …


If during the Great Depression or World War II someone had prophesied the “1945-70 boom”, no one would have believed it. In many ways, it doesn’t even sound credible today, especially to those who have no memory of this boom time. But it was not just a dream. It really happened on an amazingly broad scope. We would argue that this was in part because of the high tax rates on the very rich, not despite of it.

Where things were not yet fair [such as with minority rights], we were fighting those fights and making substantial progress. There’s a kind of a built in hope, an implicit respect… almost a hidden set of morals in the worldview of that day. We were proud of what we were doing and for mostly valid reasons. Most people didn’t need laws or police powers to do what was generally honest and good. No, it wasn’t perfect or utopian, but it was a far cry from the way things work today.