Macroeconomic Policy and a Living Wage Donald R. Stabile Macroeconomic Policy and a Living Wage The Employment Act as Redistributive Economics, 1944–1969 Donald R. Stabile Department of Economics St Mary’s College of Maryland St Mary’s City, MD, USA ISBN 978-3-030-01997-6    ISBN 978-3-030-01998-3 (eBook) https://doi.org/10.1007/978-3-030-01998-3 Library of Congress Control Number: 2018959073 © The Editor(s) (if applicable) and The Author(s), under exclusive license to Springer Nature Switzerland AG 2018 This work is subject to copyright All rights are solely and exclusively licensed by the Publisher, whether the whole or part of the material is concerned, specifically the rights of translation, reprinting, reuse of illustrations, recitation, broadcasting, reproduction on microfilms or in any other physical way, and ­transmission or information storage and retrieval, electronic adaptation, computer software, or by similar or dissimilar methodology now known or hereafter developed The 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6330 Cham, Switzerland Preface This book is a study of macroeconomic policy in the USA in the period following World War II. It challenges the idea that this period was an Age of Keynes in macroeconomic policy To so, it uses two concepts that I have coined: the political economy of a living wage and the hybrid system of redistributive economics The first concept describes an effort to use government regulation and taxation to secure a living wage for workers as a method to increase aggregate consumption The second concept combines the political economy of a living wage with fiscal policy to further augment aggregate consumption through higher wages due to increased aggregate demand In both concepts, the overarching goal was a more equal distribution of income The principal effort in the USA to create the hybrid system of redistributive economics took place during the second half of the 1940s as part of the drive for the Employment Act In this book, I will investigate what politicians, union leaders, economists and pundits wrote about the hybrid system of redistributive economics Chapter serves as an introduction to and overview of the two key concepts of the political economy of a living wage and the hybrid system of redistributive economics In Chap I will start exploring the political economy of a living wage before and during the New Deal as background for the Employment Act Chapter will continue that background by reviewing Keynes’ ideas v vi Preface regarding wages as set forth in his book, The General Theory of Employment, Interest and Money, and considering what was written about it by ­economists in the 15 years after it was published A key finding of the chapter is that Keynesian economics downplayed the role of wages in bringing about a recovery and worried that full employment might bring about wage-induced inflation In Chap 4, I will complete the background of the Employment Act and trace its origins to Roosevelt’s Second Bill of Rights, introduced in 1944, with a promise of “The right to a useful and remunerative job.” Through consideration of the legislation of the Act and the Economic Reports of the President that it required, I will argue in Chap that in the late 1940s the Truman administration and its followers bundled Keynesian economics with the political economy of a living wage to produce the hybrid system of redistributive economics Chapter will explore the economics of the Kennedy administration John F. Kennedy, usually thought of as a Keynesian, used the hybrid system of redistributive economics to revive the economy When that approach did not get the economy moving fast enough, he switched to a policy of tax cuts that combined Keynesian economics with the free-­ market approach of supply-side economics In Chap 7, I will present Johnson’s Great Society as a culmination of the hybrid system of redistributive economics Keynesian economics in the form of government spending and the Kennedy-Johnson tax cut helped to produce a very prosperous economy that enabled Johnson to pay for his Great Society and its goal of completing the New Deal program for a living wage The same policies, however, along with spending on the Vietnam War, produced inflation and Johnson was not able to find a policy to keep inflation in check This left the hybrid system of redistributive economics vulnerable to attack with both the political economy of a living wage and Keynesian economics being blamed for the inflation that persisted through the 1970s From the early 1920 to the late 1960s, Progressives were optimistic that their programs would bring about their ideal of a living wage They initially based their programs on a simple formula: collective bargaining plus social insurance plus a minimum wage yielded a living wage, especially when supplemented by fiscal policy It did not end the Great Depression In the 1940s, they added Roosevelt’s Second Bill of Rights  Preface  vii and Keynesian fiscal policy, as a way to determine how much the ­government needed to spend to reach full employment, to the formula They had ceased using the term “a living wage,” by the 1940s, but their objective remained a living wage It was not until the 1990s, as I will discuss in Chap 8, that Progressives revived a living wage as a rallying slogan for their movement This revival recognized that even with the programs of the Great Society and the use of Keynesian economics, there were still many workers in the USA who did not earn a living wage The hybrid system of redistributive economics had abetted the development of the mixed economy, but starting in the 1970s, it was increasingly under attack because of its putative failures Those attacks, however, came not only from conservatives Rather, as I will describe in Chap 8, elements of the Progressive movement found shortcomings in the hybrid system of redistributive economics as set forth as a macroeconomic policy Throughout the book, I will be reviewing arguments by supporters of the political economy of a living wage and by advocates for Keynesian economics with emphasis on the detailed Economic Reports of the President as required by the Employment Act along with criticisms of those Reports by economists and other intellectuals I not profess to have exhaustively selected every person who wrote in favor of either approach, but have tried to offer a sample that ranges from well-known politicians to little-known economists and union officials Where possible I have tried to give biographical details of each person or at least their year of birth and death; in some cases, even that information was not available The reader should take note that this book presents an intellectual history of fiscal policy with a focus on the labor elements of the hybrid model of redistributive economics rather than a broad-based economic or a political history of the reforms of the postwar era That focus will leave out arguments made against both the political economy of a living wage and Keynesian economics; Eric Crouse has already provided a solid history of free-market criticisms of Keynes.1 It will also make few references to monetary policy Herbert Stein offers a history of monetary policy during this period, and, as he argues, the Keynesians and the advocates viii Preface for what I call the political economy of a living wage believed that ­monetary policy was ineffectual.2 Even though political leaders employed the hybrid system of redistributive economics, there remained a debate between Keynesian economics and the political economy of a living wage that concentrated on fiscal policy and the extent to which it should include programs to improve the wages of workers My objective is not to determine which side of the debate had the better argument Rather, I contend that they wound up as collaborators with each side winning points that persuaded the other side to cooperate with it Whether their collaboration produced the results they desired is another issue I have skirted Economists have difficulty in identifying whether their pet policies are efficacious Economic historians not agree on what caused the Great Depression, and their explanations for why it lasted so long include that the New Deal did too much or that it did not enough To give a more concrete example, Keynes’ interpretation (see Chap 2) that the recession of 1937–1938 was due to reduced government spending overlooks an alternative explanation that it resulted from the tight monetary policy the Federal Reserve was putting in place at the same time by raising the reserve ratio of banks As a historian of economic thinking, I am more interested in looking at the ideas that political leaders found plausible to use and offer slight insight into which were correct St Mary’s City, MD Notes Crouse, 2018, pp. 462–464, 603–615 and 791–863 Stein, 1994, pp. 46, 50 and 71 Donald R. Stabile Acknowledgments The path to the final version of this book has been tortuous I began with a premise from my earlier work that the era after World War II “became an age of Keynes … and not an age of Roosevelt and [John] Ryan that led to implementation of a living wage.”1 On review of the early Economic Reports of the President as part of this book, I soon learned that President Harry Truman had not abandoned the political economy of a living wage but had combined it with Keynesian fiscal policy Further research, however, showed me that politicians and economists in the USA had appreciated the role of government spending as a macroeconomic policy before Keynes told them about it As I will describe in Chap 1, economist and later senator Paul H. Douglas published a book on solving the problem of the Great Depression by using both a living wage and fiscal policy a year before Keynes’ great work appeared.2 Douglas’ goal was to use both approaches to redistribute income to workers as a way to increase aggregate consumption It is to him I owe the concept of the hybrid system of redistributive economics I also owe others for help in not losing my way on the path to this final book Bruce Kaufman performed a very beneficial service of reminding me that I was on the verge of getting lost on the path and his many suggestions helped me to find my place Bob Pollin gave me ix x Acknowledgments his wisdom on the issues related to a living wage and helped me track down the origins of the modern living wage movement in Baltimore (see Chap 8) My background in macroeconomic policy, a key ingredient of this book, dates to my undergraduate days at the University of Florida where I took my first two courses in macroeconomic theory in spring and fall of 1965, when the events described in Chap were taking place and being discussed by my professors, especially E.L. Jackson During my time in the PhD program at the University of Massachusetts Amherst, in spring 1975, I learned firsthand from Leonard Rapping the state of disarray into which Keynesian economics had already fallen; from Sol Barkin I learned that there was a political economy of a living wage, even though he did not call it that This background and a career-long study of the history of political economy all contributed to this book, but none of the above persons bears any responsibility for the way I have used their guidance I would also like to thank the many persons who have done the work of digitizing and putting online many of the documents that I have used in researching this book The degree of their assistance can be seen in the number of online sources contained in the bibliography In addition, I thank the anonymous reviewer of Palgrave Macmillan for helpful suggestions and an overall understanding of what I am trying to accomplish in this book Those same thanks extend to the editorial staff of Palgrave Macmillan, Elizabeth Graber and Allison Neuburger, for their support and help on this project I also express my sincere gratitude to St Mary’s College of Maryland for granting me the sabbatical year that enabled me to work on this book Finally, I wish to point out to the reader that this book is a sequel to my last book and builds on the ideas of two earlier books.3 As a result some of the material in this book, especially in Chap 2, has been published previously On starting this project I had thought I would be able to cite that material and refer the reader back to those earlier works To so, I finally decided, would be to shortchange the reader and the 276  D R Stabile effort In that way, workers would have the dignity of not being dependent on the dole The basic income can be seen as a dole, with its recipients thereby lacking dignity At least that is how the early advocates for a living wage saw it Advocates for a basic income, on the other hand, could argue that giving the privilege of a basic income on everyone would make the issue of dignity moot In a postmodern, deconstructed world, however, it is arguable whether supporters of a basic income will make the compromises that make consensus possible, such as supporters of the political economy of a living wage did with Keynesian economics Conclusion For over 150  years, a movement for a living wage has existed in the USA. It started with labor unions, which saw collective bargaining as the way to attain a living wage At the beginning of twentieth century, Progressive intellectuals and politicians took up the cause of the living wage and argued for government programs to bring it about Both groups joined forces and ideas and developed what I have called the political economy of a living wage—collective bargaining, social insurance and a minimum wage In making their case for a living wage, in addition to moral reasons both groups employed economic arguments The most influential ones were that a living wage would improve workers’ productivity and sustain aggregate consumption A more subtle argument was that businesses that paid less than a living wage were being subsidized by society, which had to make up for the poverty of low-wage workers through charity or government relief programs The New Deal, with help from unions, advocates for a living wage and many other groups in its coalition, attained the basic elements of the political economy of a living wage through the NLRA, the SSA and the FLSA The New Deal reforms ended with the enactment of the FLSA in 1938 For politicians at least, it was also the end of their attachment to the term a living wage Roosevelt kept the idea alive with his Second Bill or Rights For the next 25 years, the only reform the Democrats pushed through was the Employment Act of 1946, and it was not really a reform Rather, in terms of economic policy, the Act simply codified what the   The Decline and Revival of a Living Wage  277 federal government had been doing for nearly 20 years, using fiscal policy to make it easier for business to handle the increased labor costs that might result from the programs of the political economy of a living wage More to the point of this book, the Employment Act also gave a justification for the expansion and extension of two elements of the political economy of a living wage, social insurance and the minimum wage, beyond the meager start the New Deal had given them Because the Great Society did not complete the work done by the New Deal in enacting the political economy of a living wage, at least with regard to the minimum wage and collective bargaining, it created the conditions that led to the revival of a living wage movement Those conditions also included the failure of Keynesian economics to attain a living wage through increased aggregate demand As had the one before it, the current living wage movement relies on economic and moral arguments In this way, as Snarr describes, it has connected “the pragmatic benefits of government intervention and demand-side economics with the moral obligations of government to care for the poor.”78 Whether it will succeed is not easily predictable After a wait of 40 years since the Great Society, Progressives were able to add healthcare to the social insurance component of the political economy of a living wage and complete one unfinished item from the New Deal Then the opening for reform closed before completion of the New Deal agenda of a livable minimum wage This unfinished business of the political economy of a living wage raises an important issue regarding the effect of the living wage on workers and their capabilities Workers have thus far been ineffective in securing a living wage for themselves Most of the work has been done by unions, community organizers or Progressive politicians This method of securing a living wage elicits a question of the extent to which workers sacrifice their dignity by needing the help of others to attain their goals As noted in Chap 2, the earliest proponent of the political economy in the USA, Richard T. Ely, believed that a living wage should give the worker “opportunity for the completest development of all his faculties.”79 To be effective in raising the capabilities of workers to the level needed for them to sustain a living wage on their own, they must spend their increased wages in ways that improve their “human capital” and their “social capital,” which will enable them to form unions or other organizations that will empower 278  D R Stabile them to gain higher wages on their own To have the dignity that a living wage will confer on them, they must win it for themselves They must have, to use Carol Graham’s term “agency,” an indication of the opportunity to lead the life they most desire.80 That opportunity represents an unspoken challenge to the political economy of a living wage in an era where it cannot be bundled with Keynesian economics to recreate the hybrid system of redistributive economics Rather, it has to make its peace with a cultural construct that places the building of a consensus around alternate ways of helping others out of bounds Notes Lichtenstein, 2002, p. 5 For a more complete discussion of the economic and political issues of the 1970s as related to the hybrid system of redistributive economics, see Crouse, 2018, Chaps 3–10, especially Chap on Keynesian economics versus supply-side economics Stein, 1994, pp. 16 and 221 Crouse, 2018, pp. 1358–1375 Stein, 1994, pp. 141–142 See Nixon, 1971, for an example Crouse, 2018, pp. 1521–1523 Marglin, 1990, pp. 17–18 Stein, 1994, pp. 241–294 10 Lindert and Williamson, 2016, p. 240 11 Wilentz, 2016, p. 582 12 Lindert and Williamson, 2016, p. 219 13 Temin, 2017, p. 267; Kaufman, 2018, pp. 134–137 14 Nordlund, 1997, p. 123 15 Eichengreen, 2018, p. 111 16 American Federationist, 1961, p. 21 17 Meany, 1961, p. 2 18 Goldfinger, 1961, p. 2 19 Killingsworth, 1961, p. 28 20 Barkin, 1961, p. 5 21 Tyler, 1963, pp. 1–5 22 Hansen, 1960, pp. 37–38   The Decline and Revival of a Living Wage  279 23 Dubofsky and Dulles, 2010, p. 361 24 Zelizer, 2015, pp. 70 and 167–168 25 Feigenbaum et al., 2018, p. 1 26 Bluestone and Harrison, 1982, p. 6; Friedman, 2008, p. 12; Kotz, 2015, p. 6 27 Lichtenstein, 2002, p. 215 28 Galbraith, 1967, pp. 219–220 29 Galbraith, 1967, p. 269 30 Galbraith, 1967, p. 274 31 Galbraith, 1967, p. 280 32 Gompers, 2015 33 Hacker and Pierson, 2016, pp. 2267–2268 34 Temin, 2017, p. 142 35 Reich et al., 1973, p. 359 36 Reich et al., 1973, p. 361 37 Reich et al., 1973, pp. 361 and 364 38 Frank, 2016, p. 44 39 Frank, 2016, p. 68 40 For a concise discussion of the issues with SSA pensions, see Gibney, 2017, pp. 215–235 41 For a concise discussion of the issues with healthcare, see Gibney, 2017, pp. 215–235 42 Riley, 2016, pp. 87–111 43 JEC, 1965, pp. 80–81 44 Boddy and Crotty, 1975, p. 1 45 Boddy and Crotty, 1975, p. 2 46 Temin, 2017, pp. 1866–1890, 1914 and 2091–2092 47 Hacker and Pierson, 2016, pp. 3663–3664 48 Gibney, 2017, pp. 176–193 49 Fusfeld, 1973, p. 35 50 Stabile, 2016 51 Fusfeld, 1973, p. 36 52 Fusfeld, 1973, pp. 40–41 53 Vietorisz et al., 1975, p. 94 54 Vietorisz et al., 1975, p. 98 55 Vietorisz et al., 1975, p. 98 56 Vietorisz et al., 1975, pp. 101–104 57 Vietorisz et al., 1975, pp. 105–106 58 Luce, 2002, p. 402; Lange, 2014; Snarr, 2011, pp. 2–3 280  D R Stabile 59 Luce, 2002, p. 403 60 Lange, 2014 61 Dorfman, 1949, p. 254 62 Pollin and Luce, 2000, p. 1; Freeman, 2005, pp. 14–15 63 Luce, 2002, p. 403 64 Snarr, 2011, p. 19 65 Luce, 2004, pp. 33–35 66 Bernstein, 2005, p. 136 67 Obama, 2006, p. 10 68 Obama, 2006, p. 26 69 Obama, 2006, p. 181 70 Frank, 2016, pp. 44–61 and 139–158 71 Pollin and Wicks-Lim, 2015; Dube, 2013 72 Sanders, 2017 73 Harvey, 2013, p. 39 See also Kaboub, 2013, p. 59 74 CIO News, 1944, p. 4 75 Jameson, 2016, p. 12 76 Jameson, 2016, pp. 66–159, 269–379 and 721 77 Weller, 2017 78 Snarr, 2011, p. 63 79 Ely, 1893, p. 85 80 Graham, 2017, p. 31 References American Federationist 1961 Employment Changes and Union Growth American Federationist 68 (December): 21–24 Barkin, Solomon 1961 The Decline of the Labor 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In Emerging Labor Market Institutions for the Twenty-First Century, ed Richard B. Freeman, Joni Hersch, and Lawrence Mishel, 99–140 Chicago and London: The University of Chicago Press Bluestone, Barry, and Bennett Harrison 1982 The Deindustrialization of America: Plant Closings, Community Abandonment, and the Dismantling of Basic Industry New York: Basic Books   The Decline and Revival of a Living Wage  281 Boddy, Radford, and James Crotty 1975 Class Conflict and Macro-Policy: The Political Business Cycle The Review of Radical Political Economics (April): 1–19 CIO News 1944 Annual Wage CIO News (January 10): Crouse, Eric 2018 America’s Failing Economy and the Rise of Ronald Reagan New York: Palgrave Macmillan Amazon Kindle Edition Dorfman, Joseph 1949 The Economic Mind in American Civilization Vol New York: Viking Press Dube, Arindrajit 2013 Statement Before the US Senate Committee on Health, Education, Labor & Pensions Hearing on “Keeping Up with a Changing Economy: Indexing the Minimum Wage.” March 14 http://www.help.senate.gov/imo/media/doc/Dube1.pdf Accessed February 12, 2015 Dubofsky, Melvyn, and Foster Rhea Dulles 2010 Labor in America: A History 8th ed Wheeling, IL: Harlan Davidson, Inc Eichengreen, Barry 2018 The Populist Temptation: Economic Grievance and Political Reaction in the Modern Era Oxford: Oxford University Press Amazon Kindle Edition Ely, Richard T 1893 An Introduction to Political Economy New York: Hunt & Eaton Feigenbaum, James, Alexander Hertel-Fernandez, and Vanessa Williamson 2018 From the Bargaining Table to the Ballot Box: Political Effects of Right to Work Laws Working Paper Located at https://jamesfeigenbaum.github.io/ research/ Accessed January 29, 2018 Frank, Thomas 2016 Listen, Liberal: Or, What Ever Happened to the Party of the People? 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Enterprise Institute Temin, Peter 2017 The Vanishing Middle Class: Prejudice and Power in a Dual Economy Cambridge, MA and London: MIT Press Amazon Kindle Edition Tyler, Gus 1963 The New Challenge to Liberalism American Federationist 70 (November): 1–5 Vietorisz, Thomas, Robert Mier, and Bennett Harrison 1975 Full Employment at Living Wages Annals of the American Academy of Political and Social Science 418 (March): 94–107 284  D R Stabile Weller, Chris 2017 Hawaii Just Became the First US State to Pass a Bill Supporting Basic Income—Here’s the Man Behind It Business Insider, July https://finance.yahoo.com/news/hawaii-just-became-first-us-185000124 html Accessed July 5, 2017 Wilentz, Sean 2016 The Politicians and the Egalitarians: The Hidden History of American Politics New York: W.W. Norton & Co Amazon Kindle Edition Zelizer, Julian E 2015 The Fierce Urgency of Now Lyndon Johnson, Congress and the Battle for the Great Society New York: Penguin Books Index1 A AFL-CIO, 174, 177, 196–198, 215, 234–237, 254–256, 258, 265, 269 American Federationist, 39, 112, 114, 143, 156, 177, 196, 197, 235–237, 254 American Federation of Labor (AFL), 20, 29, 36, 37, 39, 70, 84, 95, 96, 112, 114, 119, 142, 152, 156, 173, 174, 253, 254, 257 Automatic stabilizer, 16, 55, 86, 87, 148, 175, 177, 181, 185, 196, 217, 218, 248 C Civil rights, 11, 151, 152, 163, 209, 213, 234, 235, 255 Clark, John Maurice, 41, 42, 44, 57, 87, 88, 97, 117 Collective bargaining, vi, 3, 4, 8, 10, 11, 13–15, 18–20, 28, 29, 31–38, 42, 46, 47, 51, 53, 57, 77, 92, 94–98, 105, 111, 118, 121, 138, 157, 163, 174, 176, 179, 184, 217, 220, 221, 227, 236–238, 247–249, 251, 253, 255, 257, 259–261, 268, 272, 275–277 Compensatory finance, 17, 57, 81, 121, 125, 153, 155, 162, 171, 177, 178, 187, 211, 225, 227, 228, 248  Note: Page numbers followed by ‘n’ refer to notes © The Author(s) 2018 D R Stabile, Macroeconomic Policy and a Living Wage, https://doi.org/10.1007/978-3-030-01998-3 285 286 Index Congress of Industrial Organizations (CIO), 84, 95, 96, 106, 112, 114, 117–122, 127, 142, 143, 152, 173, 174, 253, 254, 257, 275 Consumption, v, 2, 8, 10–12, 14–19, 21, 33, 38–40, 45, 47, 49–56, 68–72, 74, 76, 78, 79, 86, 88, 91, 107, 108, 114–118, 120, 121, 138, 139, 143, 147, 149, 151, 153, 159, 161, 162, 171, 173, 175, 176, 179, 182, 185, 187, 188, 190–194, 196–199, 214, 215, 218, 219, 226, 233, 235, 248, 252, 266, 276 Council of Economic Advisers (CEA), 84, 85, 143, 145, 154, 155, 171–173, 178, 180, 182–187, 190–192, 196, 197, 211–214, 217, 218, 220, 223–233, 237, 238, 248, 251 Efficiency wage theory, 11, 12, 33, 34, 39, 75, 82, 139, 153, 226 Eisenhower, Dwight D., 170–175, 178, 185, 223, 226, 227, 251, 267 The Employment Act, v–vii, 1–5, 7, 8, 10, 11, 17–19, 21, 27–57, 67–98, 105–127, 135–163, 173, 179, 180, 182, 198, 211, 217, 225, 228, 231, 247–249, 270, 276, 277 F Distribution of income, v, 4, 8, 10, 11, 14, 15, 17, 18, 21, 40, 46–48, 56, 67, 71, 73, 83, 91, 93, 97, 98, 156, 160, 161, 195, 225, 233, 235, 239, 267, 270 Douglas, Paul H., 13–21, 22n33, 40, 53, 77, 83, 97, 106, 125, 175, 184, 185, 191 Fair Labor Standards Act (FLSA), 3, 4, 7, 8, 11, 51–54, 56, 57, 73, 77, 94, 105–107, 111, 126, 139, 152, 153, 156–158, 161, 170, 171, 174, 183, 185, 190, 209, 218, 220, 230, 231, 235, 237, 264, 268, 269, 275, 276 Fiscal policy, v–viii, 1–4, 7, 12, 13, 16–19, 22n33, 27, 38, 40, 47, 49, 51, 53–57, 61n117, 67, 70, 79–90, 92–94, 98, 107, 110, 114–117, 120, 121, 126, 141, 143, 151, 155, 162, 174, 176, 178, 179, 181–185, 187, 191, 192, 195, 197, 210, 212, 213, 218, 219, 221, 224, 227, 234, 248, 250, 251, 265, 268, 269, 271, 277 E G Economic Report of the President, 11, 85, 92, 143, 145, 150, 153, 154, 156, 160, 162, 173, 188, 197 Great Depression, vi, viii, 5, 7, 8, 14, 16, 38, 45, 48–50, 53, 54, 57, 71, 75, 85, 88, 89, 96, 106, 125, 175, 219 D  Index  The Great Society, vi, vii, 3, 10, 19, 199, 209–239, 247, 249, 251, 255, 270–272, 274, 277 Guaranteed annual wage, 117–122, 124, 142 H Hansen, Alvin, 2, 38, 54, 77, 81, 90–92, 95, 107, 110, 111, 114, 115, 121, 122, 125, 126, 136, 147–148, 162, 173–175, 179, 183, 191–194, 196, 198, 218, 224, 225, 231, 255, 257 Hoover, Herbert, 37–40, 47, 57, 70, 71, 79, 81, 88, 106, 107, 113, 116, 125 Hybrid system of redistributive economics, v–viii, 1–21, 27, 38, 40, 47, 50, 54, 56, 67, 68, 77, 82, 84, 87, 90, 97, 98, 106, 107, 109, 112, 116, 122, 123, 126, 127, 136, 140, 147, 153, 154, 156, 161–163, 170, 171, 174, 175, 179, 180, 184, 185, 210, 215, 224, 226, 229–233, 236, 238, 239, 248–252, 258, 260, 262, 266, 268, 269, 273, 278, 278n2 I Inflation, vi, 13, 47, 55, 78, 90–92, 94, 96, 97, 114, 125, 137, 146, 152, 153, 155, 158, 170–172, 174–176, 179, 181–185, 188–190, 201n58, 211, 212, 214–230, 237, 238, 250–253, 255, 264–266, 268, 269, 271, 272 287 Institutional economics, 19, 30, 106 Investment, 7, 13, 14, 16, 32, 48, 51, 53, 69, 70, 72, 73, 76, 78–83, 86, 91, 92, 96–98, 113–116, 121, 136, 141, 147, 163, 169, 172, 175, 176, 179, 181–183, 185, 187, 188, 190–194, 196, 198, 210, 212, 215, 219, 221, 223, 225, 238, 248, 252, 267, 268 J Johnson, Lyndon Baines, vi, 3, 8, 10, 11, 19, 52, 56, 84, 97, 193, 199, 209–217, 219, 220, 222, 223, 225–229, 231–234, 236–238, 249–252, 255, 265 Joint Economic Committee (JEC), 145, 150, 154, 185, 186, 191, 214, 218, 220, 221, 225, 226, 228, 231, 266 K Kennedy, John F., vi, 10, 56, 84, 97, 169, 170, 172, 175, 177–182, 184–199, 212, 216, 219, 227, 231, 234, 238, 249, 252 Keynes, John Maynard, v, vii, viii, 1, 2, 5, 7, 12, 13, 17–20, 22n33, 40, 47–57, 67–85, 88–96, 106, 107, 110, 115–117, 124–126, 141, 143, 155, 160, 169, 171–174, 179, 181, 187–189, 193, 209–239, 248, 249, 266–268 288 Index Keynesian economics, vi–viii, 1–5, 7, 12, 16–19, 50, 55, 56, 67–98, 106–108, 113–122, 125–127, 135, 136, 141, 144, 145, 147, 148, 150, 153, 155, 162, 169–175, 177–183, 185–191, 193, 195, 196, 198, 210, 211, 213–215, 217, 218, 223, 225, 226, 228, 230–234, 238, 239, 248–252, 255–257, 266–271, 274, 276–278, 278n2 Keyserling, Leon, 145, 155, 156, 233 L Living wage, v, 1, 27–57, 68, 106, 138, 170, 209, 247–278 Living wage movement, 29, 271–277 M Macroeconomic policy, v, vii, 1–12, 14, 17, 18, 21, 36, 38–40, 44, 45, 52, 54, 57, 68, 78, 84, 85, 90, 106, 107, 115, 117, 126, 135, 143, 148, 155, 171, 176, 178, 198, 212, 225–227, 232, 233, 239, 248–250, 252, 255, 266, 267, 270 Minimum wage, vi, 3, 4, 8–15, 18, 19, 28, 32, 36, 40–43, 46, 47, 51, 53, 57, 98, 105, 106, 111, 119, 125, 139, 140, 143, 147, 148, 151–154, 156–163, 170, 173–175, 177, 179–181, 183, 184, 196, 198, 209, 213, 216–218, 220, 221, 224, 226–228, 230, 231, 235–238, 247–249, 251–253, 255, 257, 261, 264–266, 268–270, 272–277 Multiplier, 13, 14, 16, 40, 70, 80, 123, 191 N National Industrial Recovery Act (NIRA), 3, 6–8, 20, 45–48, 51, 52, 73, 74, 88 National Labor Relations Act (NLRA), 3, 4, 7, 8, 11, 20, 33, 51–53, 56, 57, 73, 77, 85, 92, 94, 105, 107, 111, 126, 137, 145, 152, 171, 253, 255, 259, 268, 274–276 Nation’s Economic Budget, 69, 141, 143, 145, 146, 148, 149, 154, 155, 162, 163, 182 New Deal, v, vi, viii, 3–8, 10, 11, 16, 18, 32, 42, 44–56, 72–77, 85, 87, 92, 94, 105, 106, 111, 123, 124, 126, 137, 141, 144, 145, 152, 160, 175, 177, 198, 209, 213, 217, 232, 236, 247, 251, 253, 255–257, 259, 260, 265, 274–277 P Political economy of a living wage, v–viii, 3–6, 10–14, 16–20, 28–33, 36, 38–40, 42, 44, 47, 49–57, 67, 68, 71, 72, 74–76, 78, 82, 85, 87, 88, 91, 92, 94, 96–98, 105, 106, 109, 111, 112, 114, 117, 118, 120–127,  Index  136, 139–141, 144, 145, 148–157, 159–163, 169–175, 177, 179–181, 183, 185, 186, 188–191, 193–199, 209, 213, 217, 219–223, 226, 229–233, 235–239, 247–249, 251–253, 255–261, 265, 266, 268, 271–278 R Redistribution of income, 13, 48, 91, 143, 231, 274 Roosevelt, Franklin D., 3, 7–9, 16, 20, 32, 38, 40, 44, 45, 47–57, 70, 74, 75, 81, 85, 88, 105–107, 115–118, 120, 122–127, 135, 136, 139–147, 149, 151–153, 155, 158–163, 170–172, 174, 179, 188, 209, 210, 217, 231, 238, 260, 268, 275, 276 Roosevelt’s Second Bill of Rights (Economic Bill of Rights), 106, 107, 108, 110, 111, 124, 10, 135, 136, 139, 140, 140, 141, 141, 141, 142, 142, 150, 151, 152, 162, 163, 170, 173, 174, 177, 179, 191, 198, 198, 221, 231, 231, 236, vi Ryan, John A., 6, 20, 31, 32, 43, 47, 57, 75, 76, 78, 92, 111, 112, 160, 163, 230, 249, 275 289 Slichter, Sumner, 32, 42, 50, 72, 83, 85–87, 97, 100n65, 122, 175, 217, 218, 274 Social insurance, vi, 3, 4, 8, 10, 11, 14, 16, 18, 19, 29, 32, 42–44, 57, 87, 88, 98, 105, 106, 111, 148, 149, 153, 162, 163, 173, 198, 213, 217, 220, 227, 236, 238, 247, 249, 251, 252, 255, 261–264, 268, 272, 276, 277 Social Security Act (SSA), 3, 7, 8, 11, 43, 52, 53, 57, 88, 100n65, 106, 107, 111, 113, 114, 120, 126, 138, 149, 152–154, 161, 171, 173, 174, 177, 179, 183, 185, 199, 209, 214, 217, 222, 229, 231, 257, 261–264, 268, 273, 275, 276 T Taft-Hartley Act, 152, 220, 236, 237, 253, 255 Tax cuts, vi, 84, 169–199, 210, 212–219, 227, 229, 234, 235, 238, 239, 249, 252 Truman, Harry S, vi, 3, 8, 10, 11, 50, 56, 85, 92, 97, 127, 135, 137–140, 143–152, 157, 159–163, 170–172, 175, 178, 179, 182, 185, 188, 191, 209, 210, 217, 221, 229, 231, 233, 238, 275 S U Samuelson, Paul, 92–94, 97, 121, 122, 136, 162, 169, 187, 257 Underconsumption, 8, 39, 40, 45, 49, 50, 70, 71, 98 290 Index Unequal bargaining power, 15, 34, 76, 157, 159, 160 Unions, vii, 3, 5, 8, 10, 11, 15, 19, 20, 27–31, 33–37, 39, 43–46, 51–53, 56, 76–78, 83, 84, 92, 94–97, 105, 106, 112, 117–120, 122, 137–139, 152, 156, 158, 159, 173, 174, 176, 179, 181, 184–186, 190, 197, 198, 214, 220, 222–227, 230, 234–237, 252–261, 265–269, 272–277 W Wage and price controls, 55, 138, 146, 171, 215, 223, 227, 250, 267 Wage and price guideposts, 185, 189, 190, 197, 212, 214, 224, 225, 227, 236 Wallace, Henry, 106, 123–126, 135, 141–143, 145, 146, 155, 159 The War on Poverty, 210, 213–216, 222, 234, 237 ... Fair Labor Standards Act Joint Economic Committee National Industrial Recovery Act National Labor Relations Act National Recovery Administration National Resources Planning Board National War... describe in Chap 2, advocates for a living wage developed a formula for securing their goal: collective bargaining, social insurance and a minimum wage equaled a living wage I call this formula the political.. .Macroeconomic Policy and a Living Wage Donald R. Stabile Macroeconomic Policy and a Living Wage The Employment Act as Redistributive Economics, 1944–1969 Donald R. Stabile Department