Paul Krugman, Debunking the Right

Paul Krugman writes Down The Memory Hole.

"Read almost any conservative commentator on economic history, and you’ll find that the era of postwar prosperity — the gigantic rise in living standards after World War II — has been expunged from the record.

You can see why: the facts are embarrassing. Here’s a rough-cut version. The blue line, left scale, shows median family income in 2008 dollars; the red line, right scale, shows the top marginal tax rate, a rough indicator of the overall stance of policy. Basically, US postwar economic history falls into two parts: an era of high taxes on the rich and extensive regulation, during which living standards experienced extraordinary growth; and an era of low taxes on the rich and deregulation, during which living standards for most Americans rose fitfully at best."



I'm sure his point is not that all we need to do is raise marginal tax rates and increase regulation to improve conditions for the middle class. The point is to discredit the right's talking point that high taxes and regulation are what are crippling the economy now.

Update: He follows up.