Welcome to the Post-Modern Gilded Age
One word dominates political discourse in America today: Jobs! It was the centerpiece of recent the debate between Republican presidential contenders and the Democratic president’s speech to the nation.
The official unemployment rate stands at 9.1 percent; when you add those who’ve given up, the rate hits 16.2 percent. Unemployment is worse among minority groups, especially African-American, Hispanic and Native-American youth. Whether president or contender, local politician or media pundit, everyone has a plan to solve the unemployment problem. Sure.
A growing number of families throughout country live in fear of getting a pink slip, knowing that with no likely new job in the short term (if at all), it will profoundly up-end their life. Many others are struggling with the painful consequences of unemployment, compounded by foreclosure, homelessness, illness and/or poverty. Shame, and a deepening sense of failure, is griping many ordinary Americans as well as the nation. America, its economy and society, is stalled. This is fueling a growing sense of despair, a dispirited belief that the system is fundamentally broken. The unasked question is not how to solve the problem, but why is it occurring?
The decades of the American Century were marked by significant gains in the quality of life enjoyed by an unprecedented number of ordinary Americans. There were improvements in all the historical markers determining a nation’s living standard, whether infant mortality, life expectancy, educational attainment or household income. Accordingly, the birth rate significantly declined, indicating that people felt more secure about the survival rate of their offspring.
A dramatic narrowing of the gap between rich and poor distinguished the post-war decades. Capitalism was contained to meet the social good. However, since the ‘70s, corporate and, more importantly, finance capitalism has aggressively pushed to break New Deal-era restraints. Administrations, both Republican and Democratic, have been handmaidens in this process. The Great Recession, precipitated by a well-orchestrated banking crisis, was the outcome of capital’s new, deregulated freedom. Except for the gluttonous richest 10 percent, nearly everyone is poorer as a result.
Today’s political debate over how to address the problem of unemployment is framed by often-repeated calls to return America to the glory days of post-WW II prosperity. Republican and Democratic politicians argue that they can best pull the proverbial rabbit out of the historical hat and reclaim the American Century, rejuvenating the glory of the now-passing Greatest Generation.
The unasked question is whether the post-WW II era is the historic norm or an exception in the development of modern America? More troubling, are we witnessing a return to a new, post-modern Gilded Age?
In the half-century following the Civil War, America was transformed by industrialization, Indian Wars, a transcontinental railroad, the telegraph, mass migration and immigration, the seizure of Hawaii and a war with Spain that brought the nation imperialist conquests in the Philippines, Puerto Rico and Cuba.
During this period, the nation grew from a provincial former colony into an industrial might second only to Britain. The U.S. was a world power in waiting; the Great War brought it onto the center of the international stage.
Mark Twain famously named the period between the 1860s and the 1890s the “Gilded Age.” He was a tireless critic of the self-serving foibles of the nation’s gentry. He called for citizens to look under the glittering finery of new wealth to the corruption and greed that produced it. It was an era of avaricious Robber Barons, shameless financial speculators, corrupt politicians, Social Darwinist moralizing, racist Klansmen and the ostentatious display of wealth. Sound familiar?
The Gilded Age was an era of unprecedented economic growth and national consolidation. The country’s population more than doubled, from 31 million in 1860 to 76 million by 1900, fueled by immigration and migration by rural Americans. In 1900, the nation’s cities’ population topped 30 million people, accounting for 40 percent of the total, double that of 1860.
Equally significant, the nation’s total wealth grew more than five-fold, to $88 billion in 1900 from $16 billion in 1860; annual per capita income more than doubled to $1,100 from $500.
However, driven by a laissez faire ideology that rejected all government intervention (except when subsidies benefited the rich as with the railroads), John D. Rockefeller, Andrew Carnegie and other plutocrats built enormous fortunes while the average worker labored 60 hours per week for 10 cents an hour; 10 cents in 1860 is equivalent to $2.40 in 2010 dollars.
None of the titans of capitalism were more despicable than Rockefeller (in oil) and Carnegie (in steel). They amassed vast fortunes by plundering the earth, destroying generations of laboring Americans and fashioning conglomerates that strangled the very competition that capitalism so prides itself about. Today, if anyone knows their names, they represent the grandeur of old-world philanthropy. Now, a century later, their association with bulwarks of liberal, moral giving has cleansed their once-disgraceful legacies.
The Gilded Age peaked with the 1893 Chicago Exposition and collapsed in the Depression of 1893. For a period of six years, from ’93 to ’98, the annual unemployment rate topped 11 percent, peaking in 1894 at 18 percent. And the vast majority of ordinary Americans suffered gravely.
In the face of the corporate and banking consolidations that precipitated the Depression, increasing numbers of the general public, led by the major Protestant churches and labor militants, called for a rethinking of the laissez faire ethos and advocated for government regulation. This set the stage for the Progressive era which lasted until World War I, only to be followed by the “bubble” prosperity of the 1920s stock market boom and Prohibition, culminating in the 1929 crash and the Depression of the 1930s.
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Today’s oligarchs aspire to be the Robber Barons of the Gilded Age. Private jets, gargantuan mansions and palatal charity benefits have replaced the horse-drawn carriages, lavish townhouses and grand displays at opera houses and oyster palaces. Little has changed. Politicians of both parties, along with much of the commercial media, are fawning handmaidens in this process.
All the huffing-and-puffing by politicians and the media about jobs is part of an active campaign to avoid looking deeper into what’s really going on with America’s economy and society. Some are even invoking the notion that America is in “decline,” is in eclipse, like the U.K. following World War II, to describe the current crisis. The events of 9/11, the Great Recession and the growing economic might of China are used to illustrate the alleged decline.
Invoking the notion of decline helps freeze serious analysis and public debate. Not unlike the repeated warnings about “terror” threats, reference to decline is a shorthand way to legitimize the status quo. It conveys a sense of doom-and-gloom that helps rally a false sense of patriotism and the acceptance of simplistic solutions. The threat of decline is juxtaposed against the equally hollow fiction that the U.S. is undergoing nothing more that a blip (however severe) on the upward-and-onward road of progress.
During the three decades following World War II, the U.S. celebrated the great “middle-class revolution” – home ownership, a new car in the driveway, affordable health care and the promise of a child’s college education. New Deal policies fulfilled the Republican Party’s 1928 campaign promise of Herbert Hoover: “A chicken in every pot and a car in every garage.” It was a period in which the gap between the rich and the poor was the narrowest in modern history.
Instead of decline, America is undergoing a fundemental restructuring that is now entering its third phase. This restructuring is the result of a well-orchestrated and mean-spirited campaign by the most reactionary segments of the elite. They are seeking to remake America. The nation is once again being asked: Are we a corporatist aristocracy or a people’s democracy?
The first phase of this process lasterd from the August 1971, when President Nixon ended the U.S.’s adherence to the gold standard, and lasted until 1999. It involved the oil embargo, the end of the Vietnam War, Three Mile Island and President Reagan breaking of the air-traffic controllers strike might. It signaled the end of the American Century, the end to unparalleled domestic prosperity and the stagnation of the average worker’s real income. With the end of the Cold War, the U.S.’s global hegemony began to erode; the world was changing, but the U.S. wouldn’t.
The second phase started in 1999 with the passage of the Financial Services Modernization Act and culminated in the Great Recession of 2008. Promoted by President Clinton, the Act deregulated the major financial institutions. This was a truly bi-parisan effort and everyone got a slice of the pie. It was a collaboration between Citibank’s inside man, Robert Rubin, the Sec. of Treasury; the free-marketeer and Ayn Rand devotee, Alan Greenspan, Chair of the Federal Reserve; and the Republican Party, led by Texas money machine, Phil Gramm.
The Act did away with restrictions preventing the integration of banking, insurance and stock trading originally imposed by the Glass-Steagall Act of 1933. This provided the underlying rational for the Great Recession, resulting in today’s extended crisis and the further restructuring of American society.
We have now entered the third post-War phase of restructuring, the post-modern Gilded Age. American capitalism’s traditional driving force of modernization, manufacturing, has been eclipsed by finance and speculation. During the second phase, industrial unionism was decimated; now, public unions are on the chopping block. Capitalism has been restructured into a truly global enterprise and the U.S. is being subject to a form of post-modern “structural adjustment.” Finance capital’s economic police force, long wrecking havoc in the third world, has come home with a vengeance. It is succeeding in its goal of recasting the U.S. into a two-tier society.
Today, the U.S. is stuck, confronting an historical sea change. It is being restructed from a nation of shared prosperity to one of oligarchy and austerity, from a society of relative equality to one of super-rich “haves” and the rest of us “have-nots.”
The current recession, with the accompanying fear mongering about the nation’s debt and decline, is being effectively used to impose widescale cuts in public services. It is eroding the quality of life long enjoyed for decades by ordianary Americans. The outcome of this campaign will create a new, belt-tightened American reality, one being expressed in the shared senses of lowered expectation and privatized existence.
This restructuring campaign is effectively driven by the reactionary sector of American society. It is a powerful force, wanting more of the pie and to tell others how to live. It consists of a number of distinct sectors, each with its own agenda yet willing to compromise to secure presidential and Congressional power.
Among this sectors are elements of finance, the extraction industries, the telecom trust and other corporation interests; the rightwing Republican countryclub set and Christian evangelicals; conservative media companies and their paid pundits; loyal think tanks, clever lobbyists and “astroturf” groups; and the grassroots army of fearful, aging, white Tea Party foot soldiers. Together, they promote a viciously repressive domestic agenda. Most scary, they have joined forced with the foreign-policy establishment of old-guard imperialist, the military-industrial complex and the domestic-security state.
And they are winning. The Democrats, aligned with other sectors of big capital and a fading labor and civil-rights movement, are devoid of a meaningful agenda, a counter-narrative, to contest power. Under President Obama’s leadership of compromise and capitulation, elected Democatics are hoping only to hold on. Establishment liberals don’t want to rock-the-boat with either a radical critique or an assertive progressive agenda that is most needed in this time of crisis.
The challenge facing progressives is how to fight the good fight against growing corporate and government tyranny now remaking the nation. What is clear is that a new, more dynamic and inclusive popular movement needs to emerge, one that combines struggles at the workplace, the neighborhood and the digital commons and that reaches from the street corner to the voting booth, from the statehouse to the White House.
This new movement needs to superceed the traditional divisions of “class,” “color” and “culture” with a new political agenda and value system. Welcome to the long struggle of the post-modern Gilded Age.
David Rosen can be reached at email@example.com.