Friday, November 30, 2012

Corporate Profits and the Real Economy

Here's a very nice chart from Digby.  She uses it to make a very worthwhile point, but I want to use it for another purpose:

I added the red line to point this out:  The growth of corporate profits since World War II has been very consistent.  But look at the George W. Bush era.  Here we find a massive surge of corporate profits, i.e. money going to the top of the economic scale, followed by a total collapse.  Obama, the "Communist" did little more than restore enough rationality to our economy to allow corporate growth to get back on its historic track.  Once again, Republican slavishness to the rich massively disrupted our economy, at which point the Republicans took to the hills and left Democrats to clean up the mess, which they dutifully did. 

That's the historical pattern in this country, and if the Republicans go the way of the Whigs, in the end it will be because of this.  They will not protect us from economic disaster if it stands in the way of the rich further enriching themselves, and so they doom us to endless depressions or brushes with depression. 

I have long argued that the only thing which distinguished the Great Depression from what happened in 2008 is that, when the market collapsed in 1929, Republicans had over three years- until FDR's inauguration in March of 1933- to continue wrecking the economy, while luckily for us, this time we only had to wait three and a half months before responsible leaders (i.e. Democrats) could take over.  In both cases, economic recovery began very quickly, but the country was in a far bigger Republican generated hole in 1933.

2 comments:

BB-Idaho said...

The profits vs year charts clearly
follow the productivity increases v real wage charts. Productivity
increase less worker wages held constant equals corporate profit.
A simple and straightforward transfer of wealth from the producer to the owner, wholly from the workforce . Folks
don't seem to notice that....

Green Eagle said...

Well, it is as closely hidden from them as the combination of the gold vault at Fort Knox. No, instead it is drummed into them over and over again how lucky they are to live in the greatest country in the history of the world, with no medical care, no paid vacations, the industrial world's longest work week, high infant mortality, shorter life span, a huge prison population, and on and on. Americans are the biggest suckers on earth.