Putting Today’s Second Gilded Age Into Historical Context
We are now living in a Second Gilded Age. Unfortunately, most of American history has been a Gilded Age since the industrial revolution during the 1870s. Eras of true progressive reform have been rare and all too short. During most of our modern history, the country has been dominated by the top 1%.
The First Gilded Age lasted between around 1870 and 1933. During that era, the likes of the Rockefellers and the Vanderbilts dominated American politics and the economy. Most of the wealth was concentrated at the top while the majority of Americans lived in squalor.
There was a brief period of progressive reform during the Theodore Roosevelt and Woodrow Wilson presidencies between 1901 and 1917. We saw the reduction of tariffs, the Federal Reserve System, increased anti-trust enforcement, the establishment of national parks and workers compensation laws.
Unfortunately, the Roosevelt-Wilson reforms were small bore in nature and didn’t upset the overall established order. Even then, a Supreme Court dominated by big business threw out minimum wage laws and bans on child labor.
Big business and the Republicans resumed their domination of the country during the 1920s. In 1925, a Republican controlled Congress passed a big, across the board tax cut that favored the wealthy. Business wasn’t regulated and legal immigration was restricted.
Unfortunately, these GOP policies created huge stock market and real estate bubbles that popped in 1929. After the economy collapsed, the Hoover Administration went all in on austerity and refused to provide any assistance to the unemployed. Hoover and the Republicans in Congress also launched a trade war that devastated the world economy. By the time Hoover left office in 1933, approximately 25% of Americans were unemployed and the country was in a state of despair.
The Great Depression discredited the GOP and the wealthy elites who funded them. This gave an opening to Franklin D. Roosevelt and a Democratic majority Congress to embark upon the greatest era of progressive reform in American history. (Most people don’t remember that FDR had 3–1 Democratic majorities in both Houses of Congress during the first six years of his presidency.)
FDR and the Democrats passed emergency economic legislation, banking reform, securities reform, Social Security, a minimum wage law, labor law reform, the Tennessee Valley Authority and Rural Electrification. By the time the buildup for World War II began, unemployment had been reduced to 15% and national confidence had been restored. FDR saved capitalism by reforming it.
It wasn’t all sunshine and roses for FDR and the Democrats in Congress. The GOP appointees on the Supreme Court threw out large portions of FDR’s New Deal during his first term. After FDR’s court packing legislation was introduced, the Supreme Court backed down. Even then, it was a close run thing. Social Security survived a constitutional challenge by a 5–4 vote in 1937.
After the advent of World War II, the conservative coalition in Congress regained ascendance. A coalition of Republicans and conservative Democrats blocked most progressive reforms until the Johnson Administration. At the same time, this conservative coalition significantly weakened unions when they passed the Taft-Hartley Act over Harry Truman’s veto in 1947.
After the death of President Kennedy, Johnson was able to parlay his legislative prowess and large Democratic majorities in Congress to pass civil rights legislation, voting rights laws, Medicare, Medicaid, federal aide to education, Head Start, fair housing and gun law reform. Johnson was greatly assisted by 2–1 Democratic majorities in both Houses following his 1964 landslide.
Once again, an era of progressive reform was cut short. In the 1966 election cycle, the GOP gained three seats in the Senate and 47 seats in the House due to a backlash over civil rights, Vietnam and inflation. The conservative coalition was once again in charge in Washington.
Conservative dominance saw its high water mark during the disastrous Bush presidency. During his eight years in office, Bush and the GOP squandered Bill Clinton’s hard earned $5 trillion surplus on two wars, two tax cuts for the rich and the Medicare Part D program. By the time Bush left office, the economy was losing 800,000 jobs per month.
Barack Obama inherited the worst situation any new president had faced since FDR in 1933. In 2009–2010, this country saw an impressive era of progressive reform. Democratic majorities in both Houses passed the 2009 Recovery Act, the Affordable Care Act and the Dodd-Frank Wall Street reform law.
The Obama presidency was a huge success. Unemployment was reduced from 10% to 4.6%. By 2015, middle class wages were growing again and poverty went down. Obama reduced the annual deficits he inherited from the Republicans by 75%. The health care reform law insured 20 million additional Americans and the uninsured rate drop from 18% to an all time low of 9%.
Unfortunately, a combination of Democratic complacency and apathy led to the current Trump presidency and a GOP controlled Congress and judicial branch. We are in this mess because millions of Democrats stayed home or voted third party in 2014 and 2016.
Since Trump took office, the Republicans in D.C. have prioritized deficit financed tax cuts for the rich, banking deregulation and the confirmation of right wing judges that routinely serve the interests of the wealthy and the powerful, not those of working families. The present day Republicans are replicating the disastrous policies of the 1920s and the Bush 43 Administration.
The silver lining in this grey cloud is that eras of right wing excess are usually followed by eras of progressive reform. Trump and the GOP are at historically unpopular levels. We have them on the ropes. We can’t let up. We need to win on November 6! Organize! Volunteer! Vote!