Spending into prosperity
World War II ended the Great Depression. How? Massive deficit spending.
After the war, we faced a huge national debt and high unemployment. Europe was devastated, our factories were closing and our infrastructure was in tatters. What to do?
We raised taxes. A lot, with the top rate going above 90 percent. And then what? More deficit spending on the Marshall Plan, Interstate highways, dams, bridges, schools, airports, government buildings, etc., until business boomed. Unions raised wages and spread the wealth, and the middle class was born.
Deficits were reduced and an era of prosperity lasted for decades.
Unfortunately, big money (which never gives up) bought a lot of politicians, low taxes and deregulation that led to our current recession. Unfortunately, politicians now are denying us the tool that worked so well last time deficit spending.
Which is more important: to save our grandchildren from some possible future debt or to leave them a healthy middle-class economy and a healthy planet?
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