I’m sure from our takes on some of these we have pretty different ideological bents; hello my friend with different views! :) To get down my take over virtual beers with you,
The CBPP leads that page you linked with “The years from the end of World War II into the 1970s were ones of substantial economic growth and broadly shared prosperity. Incomes grew rapidly and at roughly the same rate up and down the income ladder, roughly doubling in inflation-adjusted terms between the late 1940s and early 1970s.” So (household) wealth grew in the postwar boom in real dollar terms. But I think you meant to say that, and you made a small typo: wealth grew, inequality shrank?
The CEPR link also has what I think is the most important politically (and material to people) chart, which is the real wealth growth numbers. Real wealth of the bottom 90% grew until the early 70s, dipped until the early 80s, hitting its low point in the era I was picking on, and then turned and grew, with catchup growth compared to the 1% through the 90s (my proposed golden era), only reversing course in 2001 or so, post dotcom boom and staying low, never recovering through the two crashes.
I am not someone who believes raw inequality is a number to be super worried about — I’d much rather everyone was better off, even if some become much better off; inequality arguments that don’t think about the poorest constituency having more wealth leave me cold, so I see that era of 1980-2001 as good for the 90%.
Since 2008, the 90% in the US have had hard times, reduced wealth, no recovery, and seen the top 0.1% yield all of the benefits of compounding capital. I propose this lines up very well with the political shifts we see in the US voting populace and the demands for populism, and is more dispositive than the removal of capital controls in the mid 70s.
Manufacturing: I’d like more manufacturing on shore; it adds resilience to the economy. But hollowed out is not accurate. US Manufacturing has the highest dollar value added to the GDP ever this year, nearly $3 trillion. Inflation adjusted, I’d guess growing over the 1970s to now period. Percent of economy? That’s down. But it is not down because the economy has shrunk. It’s down because new areas of the economy have grown.
Real estate as a percent of GDP is relatively stable over the last decades, although the number is a little harder to source exactly, but it looks to be 12-13% of the economy now and historically. That said, wage-adjusted homes are vastly more expensive now than they have been possibly ever, another contributor to today’s political dynamics. The reasons for that are a combination of political decisions, monetary policy, capital markets and zoning laws in the places Americans mostly want to live (cities).
Anyway, fun discussing some history with you. I’ll propose in return my favorite terrible Clinton-era policy - making it impossible to clear student loans with bankruptcy - driving university costs out of control for Americans in the process. Sanders pushing for the US to pay these costs for all Americans is so, so dumb - adding guaranteed money to a system that already has become excellent at gouging. Better would be to allow bankruptcy, resetting the relationship between students and their hefty tuition bills.