A nice chart summarizing the recent economic expansion in comparison with past booms. Two key results stand out. First, this boom was particularly lousy in the historical context. Second, the only aggregate to outperform the post-war average was corporate profits. Note especially the weak growth in wages and salaries and in employment.
Does Catholic social teaching have anything to say about this? Well, yes. In Quadragesimo Anno, Pope Pius XI wrote: “riches that economic-social developments constantly increase ought to be so distributed among individual persons and classes that the common advantage of all…. one class is forbidden to exclude the other from sharing in the benefits.” Pope John XXIII in Mater Et Magistra argued that “the economic prosperity of a nation is not so much its total assets in terms of wealth and property, as the equitable division and distribution of this wealth.”
Nobody is pinning the blame entirely on Bush and his party for this particularly weak and lopsided expansion. But it should at least be evident that his expensive tax cuts not only had little aggregate effect, but actually had adverse distributional consequences. McCain’s tax proposals would do the same. Another key imperative, harking all the way back to Pope Leo XIII, is to bolster the power of unions, so that workers can negotiate their fair share. This recent mushrooming in corporate profits at the expense of wages and salaries would probably not have occurred had the power of unions not been squashed over the past quarter century or so.
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