Twenty-two years ago, Nobel Prize–winning economist Paul Krugman wrote for The New York Times Magazine about the era in which he and I both grew up, when the top income tax rate on the morbidly rich ran between 74 and 90 percent. “The America I grew up in—the America of the 1950’s and 1960’s—was a middle-class society, both in reality and in feel,” he wrote. “The vast income and wealth inequalities of the Gilded Age had disappeared. Yes, of course, there was the poverty of the underclass—but the conventional wisdom of the time viewed that as a social rather than an economic problem. Yes, of course, some wealthy businessmen and heirs to large fortunes lived far better than the average American. But they weren’t rich the way the robber barons who built the mansions had been rich, and there weren’t that many of them. The days when plutocrats were a force to be reckoned with in American society, economically or politically, seemed long past.”
He continued: “Daily experience confirmed the sense of a fairly equal society. The economic disparities you were conscious of were quite muted. Highly educated professionals—middle managers, college teachers, even lawyers—often claimed that they earned less than unionized blue-collar workers. Those considered very well off lived in split-levels, had a housecleaner come in once a week, and took summer vacations in Europe. But they sent their kids to public schools and drove themselves to work, just like everyone else.”
Back then most businesspeople avoided politics, preferring to stick to running their companies; in large part this was because when the rich seized political control of the United States in the Roaring ’20s they crashed the economy so badly they were shamed into staying out of the political arena.
Corporate executives lived and worked in normal—albeit upscale—neighborhoods (watch an episode of Bewitched or The Dick Van Dyke Show from the 1960s to see the homes Madison Avenue executives and media bigwigs lived in), and workers made enough to sustain a decent........