The Upswing: How America Came Together a Century Ago and How We Can Do It Again

by Robert D. Putnam

both dreamers and doers, created innovations such as the public high school, labor unions, the federal tax structure, antitrust legislation, financial regulation, and more.66 Those creations did not immediately close the income gap, given the turbulence of the Twenties, but they were the necessary foundations for further developments (especially during the New Deal, but not only then) that underpinned the Great Convergence. Conversely, by the 1970s those earlier social innovations and institutional reforms had all begun to fade and even to be reversed. The growth of education “paused” around 1965, as we saw earlier in this chapter; unions had begun their long decline by 1958; in the mid-1960s tax cuts began to make the tax structure more regressive; after 1970, deregulation, especially of financial institutions, overturned the reforms begun in the Progressive Era; and most subtle, but also perhaps most important, the collective norm that “we are all in this together” was replaced by a libertarian (sometimes misleadingly called “neoliberal”) norm that we’re not. These changes underlay the pivot toward inequality in the mid-1970s