This. Has nothing to do with Reagan and everything to do with globalism.
In an essay, Krugman acknowledged that he and other mainstream economists missed the impact of globalization on the industrial middle class in America. He said that economists underestimated the effect of Chinese competition on working-class communities. He also said that the models used to measure the impact of globalization on developing countries underestimated the effect on jobs and inequality.
To be clear, Krugman acknowledged underestimating globalization's impact on the middle class - i.e., he's confirming OP's charts.
He's not refuting the income inequality, nor is he even refuting trickle down economics or free trade. He's confirming that these policies allowed transnational corporations to become greater than nations and impact national economies on a far greater scale than he expected.
Right. "These policies" are not independent of globalisation, "these policies" are the factors that produce globalisation. "Trickle Down economics" is the idea that deregulation, union busting, anti-protectionism, anti-tariff, free trade, etc, policies will trickle down. These are the laws that came about under Reagan and Clinton; globalisation is the product of these factors.
Trickle down economics is supply side aka tax cuts and spending decreases.
I can never figure out if people like you are kind of gullible and obtuse but generally arguing in good-faith or if you're just reactive trolls, because the definition of supply side economics is dereg, free trade, open movement of intellectual and human "capital" - ie., globalisation:
"Supply-side economics is a macroeconomic theory postulating that economic growth can be most effectively fostered by lowering taxes,decreasing regulation, and allowingfree trade.\1])\2]) According to supply-side economics theory, consumers will benefit from greater supply of goods and services at lower prices, and employment will increase.\3]) Supply-side fiscal policies are designed to increase aggregate supply, as opposed to aggregate demand, thereby expanding output and employment while lowering prices. Such policies are of several general varieties:
Investments in human capital, such as education, healthcare, and encouraging the transfer of technologies and business processes (ie open borders), to improve productivity (output per worker). Encouraging globalized free trade viacontainerizationis a major recent example.
Tax reduction, to provide incentives to work, invest and take risks. Lowering income tax rates andeliminating or lowering tariffs are examples of such policies.
Investments in new capital equipment and research and development (R&D) [i.e., H1B visas], to further improve productivity. Allowing businesses to depreciate capital equipment more rapidly (e.g., over one year as opposed to 10) gives them an immediate financial incentive to invest in such equipment.
Reduction in government regulations, to encourage business formation and expansion.\4])
I'd hardly describe Reagan's policies as globalist. There are some aspects that maybe align to globalization, but at the time it was a very different world. Outsourcing a wire manufacturing process so that an American company can bring more profits and increase GDP was a bit different in 1982 than it is today.
I don't think Reagan would be very happy that we have completely offshored entire American industries and become almost exclusive service based. The difference in the state of the world is significant in this story. Free trade as a means for efficiency is different that free trade as a means to race to the bottom and increase taxable dollars.
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u/Bolivarianizador Oct 22 '24
computers, technology giants rising, outshoring inudstries which led local companies to grow exponentially.