Barack Obama is a socialist, secular Marxist who hates business and wants to steal from the producers and give to the “takers.” Through overregulation, high taxes and “uncertainty,” he has made it all but impossible for American business to make a profit.
NARRATIVE #2 (in graphic form) :
As Floyd Norris notes in the New York Times:
“In the eight decades before the recent recession, there was never a period when as much as 9 percent of American gross domestic product went to companies in the form of after-tax profits. Now the figure is over 10 percent.
During the same period, there never was a quarter when wage and salary income amounted to less than 45 percent of the economy. Now the figure is below 44 percent.
For companies, these are boom times. For workers, the opposite is true.”
Now, which competing narrative should you accept? I suppose it’s like shopping for a new car or television set — it depends on what you want in a narrative. If you are less concerned with attributes such as accuracy and hard data, but more in emotional satisfaction and confirmation of pre-existing bias, if you like to believe that government taxation and regulation are killing the economy and you don’t require data to sustain that notion, you’d go with Narrative #1.
On the other hand, if you like your narratives to be data-driven and fact-based, you might find Narrative #2 more to your liking. In addition to the charts above, Narrative #2 is supported by the fact that total corporate taxes as a percentage of corporate profit are considerably lower than at any time in the past 50 years, and that personal taxes as a percentage of personal income are also much lower than the 50-year average.
Some words of warning, however:
Should you subscribe to Narrative #2, you have to confront the fact that the long-term trends documented in the charts above show no signs of abating. To the contrary, there is every reason to believe that wages and salaries will continue to fall as a proportion of economic output, and that corporate after-tax profits will continue to increase.
And should you subscribe to Narrative #1, there is again every reason to believe that wages and salaries will continue to fall as a proportion of economic output, and that corporate after-tax profits will continue to increase. But you will be blissfully unaware of such things.
– Jay Bookman