How Communism Created the Golden Age of Capitalism

The golden era of capitalism from the 1950s to 1970s wasn't brought to you by capitalism but by communism and government regulation. During post-WWII America, the government implemented socialist policies that created unprecedented prosperity while simultaneously demonizing communism abroad.

• Government contracts forced corporations like Boeing, General Dynamics, and Lockheed to build specific products with extensive oversight
• Social services including the GI Bill, Federal Housing Administration, Highway Interstate Act, Medicare and Medicaid were created during this era
• Top marginal tax rate was 91% from 1946-1963, funding social spending and development
• Employment Act of 1946 legally committed Washington to pursue maximum employment
• When USSR collapsed in the 1980s, deregulation followed, creating massive inequality
• Capitalism only wore a human face because it feared losing its head to communism

Citations:

1.      Knaack, Robert. _Post-World War II Bombers: 1945–1973_. USAF History Office, 1988. 

2.      Markusen, Ann. _The Rise of the Gunbelt_. Oxford Univ. Press, 1991. 

3.      NASA Marshall Space Flight Center. _Saturn Illustrated Chronology_. NASA SP-4012, 1974. 

4.      Sapolsky, Harvey. _The Polaris System Development_. Harvard Univ. Press, 1972. 

5.      U.S. GAO. _F‑111 Aircraft Staff Study_. February 1973. 

6.      Pedlow, Gregory & Welzenbach, Donald. _The CIA and the U‑2 Program, 1954–1974_. CIA, 1998. 

7.      Robarge, David. _Archangel: CIA’s Supersonic A‑12 Reconnaissance Aircraft_. CIA, 2012. 

8.      Francillon, René. _Lockheed Aircraft Since 1913_. Naval Institute Press, 1979. 

Check out my book Rethinking Broken now available at RethinkingBroken.com where you can purchase the paperback, hardback, ebook, or soon-to-be-released audiobook directly from me rather than through Amazon.

Chapters

• 0:35 Welcome Back After Five Weeks
• 4:47 Rethinking Broken Book Update
• 5:56 The Golden Era of Capitalism
• 10:56 Government Contracts and Communist Principles
• 16:01 Social Services During Capitalism's Golden Age
• 21:13 When Pressure Faded: Deregulation's Impact
• 27:47 Book Updates and Future Episodes
• 34:34 Final Thoughts and Where to Buy

Transcript

Speaker 1: 0:35

Thank you, hey everybody, and welcome back to another episode of the Speak Plainly podcast, where we speak plainly about things that matter. I am your host, owl Medicine. Thank you for joining me. I have had a blast being gone these last five weeks. I know it's been a while since I've dropped a podcast and I apologize, but I gotta take a break at some point or another.

Speaker 1: 1:00

So I did, and what I did for my break? After doing that amazing show with Bread and Gravy here at the Field Hall, we did the musical that Jess wrote, called A History of Music Through Time, I got to be Time Lord and it was amazing. Role of a Lifetime written just for me. It was pretty awesome. And then, a week after that, what I did is I spent a week in Athens. I spent some time with Acupuncturists Without Borders there doing care for refugees, and then I spent a week with my buddy on a boat in Preveza. The boat unfortunately wound up being flooded and had been so for many, many, many months, so that was a nightmare mess, but that's okay. Sometimes it be like that. So then, after that, he and I took a break from the dealing with a flooded boat life and we spent a week on Corfu Island, which was absolutely gorgeous. It was so fun and just beautiful, like the water in Greece was well, I mean as beautiful as the water in Croatia, which is where I flew. After that, I actually had a one hour flight from Corfu to Athens and then like a nine or 10 hour layover in Athens for another one-hour flight to Croatia, flew into Dubrovnik.

Speaker 1: 2:33

Turns out Dubrovnik is where they filmed all the King's Landing footage for that television show that everybody loved oh, game of Thrones. Game of Thrones. Turns out that's where they filmed all the King's Landing, which is like the main area in Game of Thrones. So it turned out to be a massive tourist trap, but it is a really cool spot, so I'm glad I went. I'll never go back to Dubrovnik, but after Dubrovnik I went to a town called Split. Split was similar to Dubrovnik. But after Dubrovnik I went to a town called Split. Split was similar to Dubrovnik. I stayed in Diocletian's Palace, which is a literal freaking palace that they also filmed some of the Game of Thrones stuff at. I got a tour of the crypt area, which is where they filmed a lot of the scenes from the dungeon, like the dragon dungeon in Game of Thrones, but they had some really cool like there was a press for oil for olives. There was an oil press that was literally the size of an entire room. The entire room was purpose-built to have this really long effort arm and this little fulcrum in the middle and a little thing on the back so they could super pressurize this big wooden mallet essentially that they would squeeze all the juice out of olives. So it was really it was really cool.

Speaker 1: 4:00

After that I flew up to the UK. I flew straight from Split to Manchester and I got to see the husbands I've talked about them on here before and they're some of my favorite people in the world and my, oh, my, oh, my, did we have the best time? It was absolutely marvelous. It was so hard to leave them. No-transcript. Rethinkingbrokencom. Believe it or not, you can finally now purchase Rethinking Broken the book on RethinkingBrokencom. It was just easier for me to do everything on Amazon and I really wanted to get that Amazon bestseller title so I could have that title for the book for the rest of my life and we did that. Thank you again to everyone who was a big part of that push and getting my book out and to everybody it's made such an impact on my life. I've gotten to do some really amazing stuff because of how well things went with the book, so thank you all for your support on that. It was absolutely paramount.

Speaker 1: 5:33

Now that I'm back, and now that the world is more on fire than it was when I left, I wanted to talk about the thing that's like kind of the problem at the core of all of the things that's going wrong in the world and America and our extreme fascist-like state that we're moving into. The problem with it is, well, capitalism, and so I wanted to talk about the golden era of capitalism. The golden era of capitalism is like that 1950s to 1970s time, as, like they, it's touted as the golden era of capitalism, of capitalism, but I would like to point out, with a lot of specificity and many, many examples, that the golden era of capitalism was not brought to you by capitalism. The golden era of capitalism was brought to you by communism. Believe it or not, the golden era of capitalism was brought to you by communism At a time when we were like terrified of communism. It's really funny how this worked out, but we didn't call it communism. We just kind of recognized that we were all in need after the world wars and we're like like, oh, this is pretty screwy and that's what I want to talk to you about today. I've got many, many examples. I'm gonna stick to three major corporations and how these corporations were forced into socialist or communist kind of ways of being, I guess. So those three that we're going to talk about are Boeing, general Dynamics and Lockheed, but they're not the only examples.

Speaker 1: 7:38

We're also going to talk about social services that were established during the golden era of capitalism, and social services are what communism is about. We're also going to talk about wage controls and employment. We're going to talk about the international strategy to block communism that was happening. And we're going to talk about, when the fear faded, how deregulation led to an incredible amount of inequality, and that is what is screwing us over now, and I've got a stack of sites for you that will be in the show notes. So stick with me, and this ought to be quite an eye-opening podcast for some people, quite an eye-opening podcast for some people those of us anarcho-communist type folks. We already know what's up, but this is a great way to show that capitalism, when well-regulated, works absolutely beautifully. The key to remembering all of this, the phrase I want you to remember capitalism only ever wore a human face because it feared losing its head. The only time capitalism was great and gave us the golden era, or the golden age of capitalism, was when it was afraid it was going to get its head cut off.

Speaker 1: 9:11

So let's back up. Let's go to post-World War order. How was the world set up? What was happening then? So the era that we're looking at right now is World War II. World War II ends. Europe is in ruins. The Soviet Union emerges as a superpower and that creates US fears. The United States then fears a communist expansion, truman Doctrine and a Marshall Plan. So then in the United States we create a bunch of domestic policies that shift to keep working class Americans loyal. We have the Employment Act of 1946, and then we have the Cold War pressure. The Cold War pressure some people even call it the Cold War pressure cooker for us to compete with communism or risk being replaced by it. We had to compete with communism. That was the only option that we had at this time.

Speaker 1: 10:12

At the end of World War, everything was in shambles. People had left and gone to war, fought and come back, and now, while there was war, there were these massive, state-planned capitalistic programs that were then turned communistic. The three flagship firms that illustrate how the capitalist giants, through their Cold War centralized planning, like through the government, became fundamental for all of the things that we tout capitalism, for it was actually the capitalism being regulated by the central government, forcing them to do stuff for their people because our people were struggling. So the first example is Boeing. Boeing all they cared about was aerospace supremacy. And in the first example is the Boeing B-52 Stratofortress. That was a United States Air Force contract for $5.6 billion. The parameters were they needed to carry a 10,000-pound nuclear payload, an eight-man crew and have a cost-plus initiative fee with government oversight on every major milestone.

Speaker 1: 11:32

So what happened is the federal government went to Boeing and said you guys are going to build this new plane. It's called a B-52. We're calling it the Stratofortress. And the B-52 bomber is the most quintessential. They were these massive bombers and I remember getting toys of these as a kid and my father, who was Air Force and his father was also Air Force explaining that the cannons on the side, the giant guns on the side of the ships, were so big that they could shoot out the side of the plane and it would shift the plane laterally in midair. But the government came to Boeing and said you guys need to build these things. They need to be. Here's a contract for $5.6 billion. They need to carry eight men, they need to have a 10,000 pound nuclear payload and we have oversight on every single design milestone.

Speaker 1: 12:26

That is not free market capitalism. That is capitalism being stepped on by the government. These independent companies, these private companies, should be able to do whatever they want. But because they were making things that the federal government would benefit from, they said you are going to make exactly these things. And so they were able to sign contracts and hire people and do all the great things. So they did the same thing with the K-135 Strato tanker. They spent $2 billion for 732 tankers and they created more parameters. They need to have 35,000 pounds of fuel.

Speaker 1: 13:12

Boeing was required by the federal government to adapt its prototypes to make what the government wanted them to make, and they forced certain payment to the people working in the companies. But we'll get to that eventually. They also had a NASA contract. They gave $2.8 billion to NASA. They did this with General Dynamics. They had the Polaris, the USS George Washington. They had the F-111 FTX multi-role bomber. They created a lightweight fighter prototype for $38 million. For two different prototypes they had fly-by-wire controls. Then they had firm fixed pricing for flight test penalties.

Speaker 1: 13:59

The federal government mandated that these companies build certain things in certain ways and guaranteed that there would be a fixed price for these so that all of the workers could get paid what they needed to be paid. They did the same thing with Lockheed. They had the U-2 bomber, the Dragon Lady, they had the C-130 Hercules, they had the A-12 and the SR-71, the Oxcart and the Blackbird. These were CIA contracts with Lockheed Martin. The C-130 was an Air Force contract with Lockheed Martin. The U-2 was a CIA Aquatone subcategory contract from 1955. Yeah, a Aquatone subcategory contract from 1955. All of these amazing planes that were built, that became like the thing that protected America was forced to be created by the federal government. That's communist shit. That's what's so crazy. That's communist shit. That's what's so crazy. That's communist shit.

Speaker 1: 15:05

When the federal government tells corporations what to do, the right and conservative people scream about government overreach. Government overreach, that's not free market capitalism. But the thing is is free market capitalism eats itself? It is a snake constantly eating itself, just getting bigger and bigger and bigger and bigger until it collapses empty. The golden age of capitalism was created by government overreach in these private entities, telling them what to create and how much to pay for it, which guaranteed income for all of the people working for them. And these were massive contractors with massive numbers of employees. But that's only the government overreach part. The real part that I care about is the social services.

Speaker 1: 16:01

This was the beginning of the GI Bill. This is what I've used to go to school, what I've used to study psychology and sociology and acupuncture. I've used my GI Bill to go to school and that didn't exist until 1944. And there was $14.5 billion spent on it by 1956. 7.8 million vets attend college or tech schools because of the GI Bill. They said, hey, we're going to give you free education if you sign up. That free education is communism.

Speaker 1: 16:41

There was a federal housing administration and VA loans were created in this $120 billion in subsidized mortgages from 1945 to 1970. $120 billion in subsidized mortgages to make sure that people could afford housing after the World War and all of the world's economies went to shit because the world's economy was dominated by Western Europe, which has now been bombed to hell. Within that Federal Housing Administration stuff. 60% of new suburban homes were built with FHA or VA backing. 60% of the houses built from 1945 to 1970 were built with money from the federal government backing them so people could afford houses to live in which no one can afford anymore. Then there's the Highway Interstate Act of 1956, $25 billion in federal shares over 16 years. The DOD dictated 41,000-mile network with defense evacuation specs. Literally, our interstate highway system was created under all of these mandations by the federal government during this time of capitalism.

Speaker 1: 18:07

And all of these acts are very socialist acts. They're not acts that are just companies making more money for themselves. They're being forced on the United States by the United States government. And here everyone who's been upset recently because Medicare and Medicaid are under attack, that's communism baby. That's socialism. And that was also created during this golden era of capitalism. It was created in 1965, and the initial outlay was $4.6 billion, signed amid civil rights unrest.

Speaker 1: 18:50

To finish, the quote New Deal. Remember all the New Deal stuff that we learned in school? Medicare and Medicaid was a part of that. This is how old people get taken care of. This is how they afford treatment in our obscene and disgusting medical system. Especially our insurance system is what has made it the most disgusting. But we have communist, socialist things that we rely on as a country. Yet we constantly poo-poo communism and say that it's terrifying and it's all actually been beneficial.

Speaker 1: 19:27

Then there's wage control. There's the Employment Act of 1946, which legally commits Washington to pursue maximum employment. Top marginal rate tax was 91% from 1946 to 1963, which funded social spending and research and development for all sorts of marvelous things. The Treaty of Detroit was in 1950, and it raises wages 16 cents per hour. Yet pensions and health care programs are encouraged by the Truman administration as a form of inflation control. Like these are all very smart socialist tactics. But then the Marshall Plan comes out and the Marshall Plan sends $13 billion grants between 1948 and 1952. That were all funds explicitly tied to anti-communist labor policies. While we are actively doing communist things to keep people quelled, it's like they give people just enough communism to keep them from dying and then spend the rest of their money trying to convince them that communism is evil. That's exactly what happened here. That was the Marshall Plan.

Speaker 1: 20:51

Then the collapse of the USSR happens. When that happens now, the pressure is off. The pressure to compete is totally like set. It is gone now. The Reagan and Thatcher era, because now we're looking at Ronald Reagan and Margaret Thatcher over in the UK. They just start handing money to rich people and they do this by slashing that 91% top tax rate. They slash that dramatically, they start absolutely destroying unions and they make sure that all of the welfare that we had in the United States is starting to erode and in Europe. Then, after the collapse of the USSR and the pressure is off, they cut all of the stuff that was helping people and capitalism returns to its pre-New Deal power dynamics and the income share of the top 1% doubles between 1980 and 2020.

Speaker 1: 22:02

In those 40 years, as soon as we deregulated and stopped trying to cut the head off of, or stopped threatening to cut the head off of, communism, the thing was during the Red Scare, during the USSR, everyone was freaking out about communism because there was a paid program to freak out about communism. They tried to freak everyone out about communism, but there were enough people who were thinking about it and looking around and going. You know, this is actually like really helpful. So we had to compete. We had to compete and offer people education, offer people housing, offer people healthcare. That's when all of this stuff happened. We had to offer people housing, offer people health care. That's when all of this stuff happened. We had to offer people a living wage to seek maximum wages in Washington. These are all socialist policies that came to us that created the golden era of capitalism, which just goes to show that the golden era of capitalism, which just goes to show that the golden era of capitalism didn't reach its peak because of capitalism or because of communism, but because of both.

Speaker 1: 23:23

I think. No matter which you choose, the other regulates it right. Capitalism without regulation is fascism and socialism without regulation becomes communism in a bad way, like where you have communism but there's one person in charge who takes all of the money that's supposed to be being distributed. That's not real communism. Communism has to do with the ownership of labor and the ownership of surplus ownership of labor and the ownership of surplus. When we talk about how good things used to be in America and people are talking in their red hats about how great America used to be and wanting to make it great again they're often referring to this era in time of this post-World War II red scare golden era of capitalism, from the 1950s to the 1970s, where, because communism was working so well. In other superpowers, specifically the USSR, people started looking at that and going, hey, that makes some sense. And capitalism, because it was terrified, had to put up a fear tactic and say we can't do that, that's super evil, while quietly giving people exactly what they needed through communism. The reason we got through the Great Depression was World War II. That's what everybody says, right, but it's actually because of the communist-style leadership that our federal and state governments took through the fighting of World War II and in the years just after.

Speaker 1: 25:06

The New Deal was a way to stop all of this power concentration that had happened at the beginning of the turn of the century, in the early 1900s. This is when I talk about the Flexner Report in the most listened to podcast episode I have so far, a Brief History of the American Medical System. This is the pharmaceutical era. This is when John D Rockefeller became the richest man in history. There was a massive amount of power that was very limited to a small number of people the Vanderbilts and the Rockefellers and those big names, right. But then the World Wars happened. We got thrown into war and the people who had so much they were forced to do things that benefited everyone by the government. That's why things got better.

Speaker 1: 26:00

So my question now is since we are in this pre-New Deal power dynamic era and since capitalism rules absolutely everything and we've now had these techno lords take over the federal government and well, one techno lord, and then he had a fight with his boyfriend, but the techno lords still rule everything. The Amazon and the Teslas and the Googles and the Metas. They still rule everything. But what would it take? What communist policies, what socialist policies would it take to civilize capitalism again? Because the only reason capitalism ever wore a human face was because we threatened to cut off its head. We saw how good communism was. It gave us the greatest era of capitalism that we've ever known. It allowed the USSR to become a superpower in the world. It can do lots of good, especially if you combine certain communistic practices with certain free market capitalism practices.

Speaker 1: 27:13

Not to say that I think capitalism and free market are the same thing, or that you can't have free market capitalism practices. Not to say that I think capitalism and free market are the same thing or that you can't have free market without capitalism. I think it's much easier to have free market without capitalism. But that will be a podcast for a future date I will be talking about the origins of capitalism, what capitalism is and isn't, what's the difference between capitalism and commerce, and give a few examples of the first capitalistic. Well, the first capitalism programs, essentially, if you want to call them, like the East India Trading Company and those sorts of things. That's when it all began. I'll be doing a breakdown of that, so stay tuned for that if you're interested. But with this that, so stay tuned for that if you're interested.

Speaker 1: 27:58

But with this, the federal governments said to three of the biggest companies in the world General Dynamics, boeing and Lockheed. Now Lockheed Martin said here's what you're going to build, here's how you're going to build it, here's how much you're going to pay. Then they used that money at a 91% tax rate for those top earners. Then they used that money to create social services like the GI Bill, the Federal Housing Administration, highways, the interstates and Medicaid and Medicare. They created the Employment Act of 1946. They had that top marginal tax rate of 91%. They created the Treaty of Detroit, raising wages and pensions and healthcare as a way to manage inflation control.

Speaker 1: 28:44

And when everything faded from the pressure cooker of communism, when the USSR failed, we just deregulated everything and went, ooh, let capitalism run free. But we need this New Deal era crap again. We need ways to regulate. We need that 91% tax rate back. That's what we need. And then we need to actually use that tax money for things other than loaning money to more rich people to then build more crap and get more in debt. To then loan them more money again. It's insane. The whole system is insane.

Speaker 1: 29:22

So if you want to know the citations, all the citations will be in the description. Let me know how you like this podcast. Please leave a comment. Let me know if you're going to stick around for this next one, because I'm definitely going to be covering a history of capitalism, what the differences are between capitalism and commerce, and I'm going to try to have an argument with Jess Donges about this, because he calls himself an anarcho-capitalist and I call myself an anarcho-communist, and I think once we get down to the nitty gritty of the difference between commerce and capitalism, I think we're going to wind up agreeing and I think he'll be in line with me a little bit more. But who knows, we'll see, at least with what my current language is. But usually we have the same principle, the same understanding. We just might use different words. Anyway, stick around for the next episode which will be coming out. I'm going to be trying to put one of these out every single week.

Speaker 1: 30:19

I have recently hired an executive assistant who has been helping me so freaking much. Oh my goodness, it's going to be interesting. I might even wind up doing episodes about that, because it's actually my partner, michael. He's been working for Nutritious Movement for a long time and now he's got some free time. He's available to work for me and that's making me quite excited. That's how I've gotten Rethinking Broken available on RethinkingBrokencom. I've revamped the entire site. Now you can go on there and you can buy the paperback version, the hardback version or the ebook version.

Speaker 1: 30:58

Today I will be uploading the audiobook. I'm not selling the audiobook on Audible. Let me repeat that Right now, as of right now anyway, I am not planning on selling the audiobook of Rethinking Broken on Audible. I know that that's annoying, but I would be making a few dollars and Audible would be keeping about 80% of all of the money that would be made. They are an evil cloud rent company who is stealing all of the goods, and that's how much money they keep. When I wrote the book, edited everything and narrated it myself. All they are is the platform and I would be getting basically nothing. So if you want to buy the audiobook of RethinkingBrokencom, look out for that. I will be uploading it, probably today, and I will create a newsletter that will go out as soon as it's out, announcing all of the upgrades, because I've just put in a shop. Before it was just a way, a place for people to go and learn about the book, but now it is a place to learn about the book, to buy the book in its many forms, and I have already started and finished the first module in the ADHD Survival Kit. It's a program that I'm building on there, as well as a couple of downloads that people can have that will all be for sale on RethinkingBrokencom. I'm really excited about all of this.

Speaker 1: 32:30

I've got new articles up on decolonized healthcare, about borderline personality, which is something I think more people ought to know about, because it is one of the most damned personalities. It's one of the most harshly judged and people are terrified of it thanks to movies that have been out and that sort of thing. But I want to humanize it as someone who certainly was borderline personality and, interestingly enough, it does auto-resolve. We have studies where people were followed 10 and 15 years after being hospitalized for borderline personality symptoms and they tend to auto-resolve. If you have a semi-healthy, long-lasting relationship, if you have a semi-healthy, long-lasting relationship, anyway, I've got a new article written by a medical doctor up on the page. That way you can go check that out and learn a little bit about you or about somebody that you know and love. If you know somebody who has an unstable sense of self, who gets really lost in relationships and goes from relationship to relationship and each relationship is like a new identity for them each and every time, that's probably borderline personality type stuff. But there is hope.

Speaker 1: 33:45

Dbt dialectical behavioral therapy which I've covered on this podcast, because I went through a six-month VA DBT program that I absolutely loved. I swear by it because it literally just teaches you how to be a human. So like I. Va DBT program that I absolutely loved. I swear by it because it literally just teaches you how to be a human. So, like I, love DBT. So don't get heartbroken and don't get butt hurt if you're like, oh I have, this was probably me. Join the club. There's ways to learn how to be a human and how to function in the human world. And DBT is phenomenal, designed by a brilliant, brilliant doctor who herself had borderline personality disorder and is why she came up with DBT. Anyway, that is another piece for you that's out on decolonizehealthcarecom. I sent out a newsletter just yesterday reminding people, showing people, hey, we've got a new article out there. So if you're interested in borderline personality, go to decolonizehealthcarecom.

Speaker 1: 34:43

If you're interested in purchasing a copy hardback, paperback, ebook or, very soon in the next few days, the audio book as well of Rethinking Broken, you can go to rethinkinginkingBrokencom. Check out all of the new edits. Buy your copy, buy your friend a copy, mail somebody a copy. I will be happy to take these orders. I will be the only person filling them. My executive assistant, michael, will probably help me if I'm out of town and whatnot as well. So when you place an order there, it will come to me and I will have to actually box up the book and mail it flat rate to you on USPS. But that is how we keep the world going. The post office is a very wonderful thing and we need to keep it. So, using the USPS, ordering directly from me, you get to save money because the books are cheaper when you order them on RethinkingBrokencom than if you order them on Amazon. So you save money and I make more money, and we like that all the way around, especially when the USPS gets to make money as well. So thank you for your time.

Speaker 1: 35:53

Thank you for listening to this episode. If you liked learning about how capitalism was made to look phenomenal and got a great reputation because of how it interacted with communism past World War II, please leave a comment. If you thought that was cool, hooray, listen to the next podcast. It will be coming out soon. Thank you so much for your attention. If you made it all the way to the end, you're a champion. Thank you, and remember stay curious and stay uncomfortable. We'll be right back. Thank you.