With the caveat that this facile explanation is almost certainly insufficient to explain large scale changes in the largest national economy:
I believe during the boom years of industrializaton, THE scarce resource was manpower. Factories were full of machines, and machines were operated by humans. In 1943 U.S. Steel employed 340,000 workers.
The high demand for manpower allowed workers to capture a greater proportion of the economic surplus their activities generated through negotiation.
At some point other ingredients of business became crucial and thus the balance of power shifted.
The rise of the corporate raider mentality. Instead of making money by making and selling things, American corporations shifted towards financial games instead, seeing a prosperous factory as an unmined resource to be cut up and sold to the highest bidder.
To be fair, Carter's reign wasn't exactly an economic wonder-time, and I don't think Reagan was influencing the economy that much as governor.
I do think there's a political dimension to the change, but laying the blame at Reagan's feet exclusively seems like simple political point-scoring.
Edit: it's funny seeing this comment getting down-modded. I think I'm significantly more liberal than most people here, but it looks like people are upset that I called out empty partisanship? I fail to see anything particularly inflammatory about what I wrote.
The article gives two ranges: 1947-1979, 1980-Present. Reagan's presidency (1981-1989), and the political changes it brought, coincided with the beginning of the second range.
Right, again, I think there's a political dimension to this, but I don't think Reagan created the problems two years before he got into office. My gut tells me economic repercussions like this probably lag their causes by several years, and looking at the graph, there's reason to think the problem started even earlier in the seventies.
In short, saying Reagan had a big part in this is a claim I would support, but saying it's all Reagan's fault is clearly untrue, barring time travel.
So by extension the current economic downturn is entirely Obama's fault then? Also, take a close look at the graph. Looks like things had stagnated in the early 70s, but the graph does it's best to hide that. Now off we go to partisan bickering about who was in control of congress blah blah... it's all BS.
It's silly for presidents to talk about the economy at all. It's just another way for politicians to take credit for something they aren't responsible for. Do you think Jobs and Woz started Apple because of Carter's economic policy? Do you think Microsoft succeeded because of Reagan?
Of course some companies rise and fall along with the political tides. I suspect that a close examination of these will show you bribes and favoritism. Companies that depend on a favorible political climate probably aren't adding to the economy at all.
