From around 1950 to 1973, capitalism experienced what has been called a golden age. From France and its “trente glorieuses” to Sweden and its “record years” to the various “economic miracles” of Japan, Belgium and Italy to the emergence of South Korea as a developed country, countries around the world — but mostly in the Global North — sustained high levels of growth along with full employment and consumption so abundant luxury goods became necessities.

Knowing the precepts of the gurus of the free market, one would expect this period to be one of extreme liberalization and inexistent state intervention, taxes and welfare. Except it was not. In reality, the so-called golden years of capitalism were marked by a strong labor movement, expansive welfare states and, by today’s standards, sky high taxes. In fact, in the United States, the federal income tax was a whopping 91% for the highest income bracket between 1953 and 1961.

This was a time when the Great Depression had both exposed the failings of unfettered free-marketeering and whipped up enough political will among the elites of Western societies to embrace interventionism. This was also a time when the Soviet Union was growing fast economically and when the specter of communism hung heaviest over the Western hemisphere. The threat of communist takeover, along with the haunting memory of the rise of fascism, spurred on by the catastrophic unemployment rates of the Great Depression, convinced politicians, moderate and conservative alike of the importance of full employment as a sociopolitical goal.

Economists such as John Maynard Keynes or John Galbraith provided them with the necessary policy frameworks. These frameworks emphasized smart, which does not always rhyme with small, public spending. Indeed, the golden years of capitalism were the era of public works, infrastructure projects and welfare programs which employed a sizable portion of the population.

Of course, as with many other questions of economic history, the roots of the golden age of capitalism cannot be traced back to a single policy framework. Historically, low oil prices and the rise of revolutionary new technologies, among other factors, were also of importance.

However, the effects of interventionist policies were not negligible. The higher consumption of the period was in great part sustained by fuller employment, itself a product of public works and expansive welfare.

But all golden ages must come to an end. In 1973, the Organization of Arab Petroleum Exporting Countries proclaimed an oil embargo against all countries that supported Israel during the 1973 Arab-Israeli War, which led to a sharp increase of oil prices and sent shockwaves throughout the world economy.

The damages of the oil crisis were compounded by the increased interconnectedness of the world economy as multinational corporations took to offshoring their productive processes and governments saw their economic power dwindling. Once essential in bringing about and maintaining the golden age, national economic policies of public spending increasingly lost their relevance as multinationals gained power and influence, moving freely through borders and tax schemes.

As is customary with extinction events, the end of the golden age ushered in the hegemony of a new set of economic theories which had previously populated the undergrowth of economics. These were the neoliberalisms of Hayek and Friedman and the triumph of the Chicago School. Yet, these theories, which prescribed limited if not inexistent governmental interference, had mixed results in the countries that adopted them. Furthermore, even as they chipped away at public services, neoliberal governments found themselves unable to completely rid the state of its economic importance; Reagan presided over a sharp increase in public debt in the U.S. and the British people found themselves paying more taxes after Thatcher’s governance than before.

As such, the demise of the golden age is less evidence of the failings of public spending than the mark of a changing world economy which requires new supra-national mechanisms to curtail the power of international corporations. The economic policies of the golden age remain a damning indictment of the present economic orthodoxy. They show that entrepreneurial will is not so easily broken by high taxes and that equality and efficiency are not necessarily contradictory.

The golden years of capitalism do not represent a past ideal to be rebuilt just as it was. After all, those years also coincided with the Jim Crow laws in the United States and lingering colonial dependencies worldwide. Rather, they are a call to action, an invitation to think outside the box of economic orthodoxy. As the G7 moves to internationally impose a measly 15% tax rate on multinational corporations, a rate lower than that of many of the countries signing the agreement, and as Joe Biden proposes to raise the corporate tax from 21% to 28%, a rate still below its pre-Trump level of 35%, the example of the golden age might compel us to dare ask for even higher and fairer rates rather than alarm ourselves about fantastical tax-induced drops in productivity.