When the economy went boom.

Nostalgia Clouds Reality

The 1950s


The good old days right? Shared values. Prosperity. Growth of the middle class. Stopping the communists. Might makes right. Going to church. Except, not everybody was included, and that was by design.

I came across an interesting article about this on the History Channel. Remember when they actually aired documentaries?

The 50's is depicted as a time of booms. The baby boom produced 77 million children. The astounding economic growth of the post war 50's saw GDP rise sharply. "The gross national product more than doubled, growing from $200 billion to more than $500 billion, kicking off “the Golden Age of American Capitalism.” 

There was also the booming growth of the suburbs." Levittown featured affordable suburban living in cookie cutter houses. Ethnic minorities were excluded, but the white exodus to the suburbs became a stampede.

Capitalism and The American Dream

Almost all of this growth came about through stimulus, government spending instead of capitalism. "Much of this increase came from government spending: The construction of interstate highways and schools, the distribution of veterans’ benefits and most of all the increase in military spending–on goods like airplanes and new technologies like computers–all contributed to the decade’s economic growth. Rates of unemployment and inflation were low, and wages were high. Middle class people had more money to spend than ever–and, because the variety and availability of consumer goods expanded along with the economy, they also had more things to buy." (History Channel) Millions of Americans realized the American Dream because it was underwritten by the government.

Not everybody was included

Because the G.I. Bill was administered locally, states in both the south and the north discriminated against African Americans, and other minorities, in their pursuit of higher education and in housing. For example, in the south, African American veterans were not allowed to enter state universities, because of segregation. (billofrights.com) The boom was a whites only event.

Women were feeling the effects of increasing isolation. The move to the suburbs meant fewer opportunities for women. Women were expected to be at home and be the perfect housewife. My mother was a grade school teacher. She was required to give up her job and spend full-time running the house and raising the kids. Looking back, it seems like a waste of her talents.

Black people were told to wait, but ultimately the benefits given to whites were not offered to them. In order to pass the GI Bill, states were given authority over distributing the benefits. African Americans who fought honorably against the Nazi's and Imperial Japan were deliberately excluded from GI loans, for education and housing. Whites who fought benefited from these programs. The white middle class boomed. Blacks and other minorities were excluded, and until the Voting Rights Act, many were prevented from voting. Any chance to better their lot was deliberately thwarted.

The result is the huge difference in generational wealth. According to research shared by Synchrony Bank and the Federal Reserve, comparatively, black families achieve considerably less wealth than white families, with a median net worth of $24,100 compared to $188,200.
According to the World Economic Forum, the growing gap between the rich and the poor, the old and the young, has been largely ignored by policymakers and investors until the recent rise of anti-establishment votes, including those for Brexit in the UK and for President Trump in the US. This is a mistake.

Inequality is much more than a side-effect of free market capitalism. It is a symptom of policy negligence, where for decades, credit and monetary stimulus shortcuts too easily substituted for structural reform, investment and economic strategy.

 Capitalism has been incredibly successful at boosting wealth, but it has failed at redistributing it. Today, without a push to redistribute wealth and opportunity, our model of capitalism and democracy may face self-destruction. (World Economic Forum)

Oh yes, the past can hurt. But from the way I see it, you can either run from it or learn from it.

- Rafiki, “The Lion King” (1994)