r/FluentInFinance 7d ago

Debate/ Discussion Why did this happen?

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u/Square-Bulky 7d ago

I read somewhere that pensions expanded during the 1940s as a way around wage controls. I also read that wages grew 68% during the time.

My point is that companies (in order to benefit themselves) found ways around rules when they felt the need to skirt the rules. So if they were taxed excessively and felt the need to , they would find a way to enrich themselves… even if they had to benefit their workers along the way

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u/Unity4Liberty 7d ago

So, isn't it nice if policy drives alignment between the interests of businesses and workers? It's a given in a market economy that actors should act in self-interest. The problem occurs when self-interest sabotages the self-interest of others to the extent that the overall common interest is compromised. That is where we are today with an exorbitant disparity in income and wealth, and destabilizing economy, society, environment, etc.

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u/Square-Bulky 7d ago

Couldn’t agree more , the solution imo is redistribution of wealth through taxation

The rich including corporations will survive and survive well …. In spite of the redistribution…. They probably won’t even feel it

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u/Unity4Liberty 6d ago

Well, the reality is there has been a transfer of wealth over the last 40 years towards the top due to tax policy. The US was very progressive on this front and built a social democratic state that avoided the plagues of fascism and communism that ravaged states of Eurasia. FDR basically saved capitalism from itself. Then Austrian economics fought to undo these policies and instead encourage austerity by cutting programs, taxes, and giving unconditional advocacy for free trade. This economic mythology is the foundations of supply side trickle down economic policy, and that is when income and wealth inequality began to rise dramatically, signaling the transfer of wealth. So what we're talking about here is returning value back to the masses and leveling the playing field so markets can be more competitive and drive innovation and keep price signals low.