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The 150-Year Labor Shortage, The Fall of Corporate Taxation: Things The Establishment Media Don’t Exactly Emphasize

Woman Struggling to Embrace Marx (photo: [planeta_roig, flickr)If you haven’t encountered it already, I highly recommend Southern Dragon’s excellent series of diaries entitled “Marx in the Morning”, featuring lectures and commentary by Richard D. Wolff and David Harvey. (Here they are so far, in order: #1, #2, #3, #4.) The comments threads are among the best in terms of concentrated utility (very good signal-to-noise ratio, in other words), and the post contents are themselves worthwhile. Even if you’re a certified smartypants, chances are that you’ll learn something new and useful.

Aside from the revelations about Marx’s work, I learned two useful things that are central to American life today, yet which I have never once heard stated on the radio or TV or read in a newspaper: I learned about the labor shortage that fueled the 150-year period of rising wages in the United States, and I learned about the fact that corporations used to pay a lot more in corporate taxes, especially as an overall percentage of American tax revenues, than they do now.

As Rick Wolff has explained in various fora (such as here), the 150-year period of rising wages lasted from 1820 to 1970 — essentially, for as long as there was something resembling cheap undeveloped land that could be farmed and before mechanization and computerization had raised productivity and efficiency to the point where employers (both in the city and on the farm) could get by with fewer workers (and so didn’t need to keep hiring them, much less giving them pay raises). Wages have since then started to drop, to the point where even two-income families don’t have the same standard of living their parents enjoyed on one income, much less any hope of improvement on what their parents enjoyed.

As for the corporate tax revelations, those are especially ironic as one of the favored whines of the one-percenters and their shills such as the boys and girls of the Heritage Foundation is that American corporations pay too much in taxes. What the one-percenters won’t tell you, Rick Wolff does — namely, that American corporations used to pay a lot more in taxes than they do now:

Compare income taxes received by the federal government from individuals and from corporations (their profits are treated as their income). The table below (in millions of dollars) is based on statistics from the Office of Management and the Budget in the White House:1

Year Total Individual Income Taxes Total Corporate Income Taxes
(In Millions) (In Millions)
1943 6,505 9,557
1948 19,319 9,678
1968 68,726 28,665
1988 401,181 94,508
2008 1,145,747 304,346

The overall picture is unmistakable. The trend is clear. During the Great Depression federal income tax receipts from individuals and corporations were roughly equal. During World War Two, income tax receipts from corporations were 50 % greater than from individuals. The national crises of depression and war produced successful popular demands for corporations to contribute significant portions of federal tax revenues.

Two extremely important facts, yet until a few weeks ago I hadn’t heard of either of them. I’m betting that not one in a hundred people know of them.

Thanks again, SD.

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