Our New Gilded Age: The Road To Neo-Feudalism?
Note: This article was originally written on 29/09/2021 and will be published in the upcoming issue #7 of The Mallard’s print magazine.
By Sam Volkers
Introduction
The Gilded Age was a period in American history marked by its inequality, corruption, and greed. During this period economic inequality was high, poverty was rampant, corporate greed destroyed nature, the economy was dominated by a few monopolies, and politics had become subverted by corruption and lobbying. To many, this situation might sound similar to our current epoch. And that is because it is. After 40 years of neoliberal politics, it has become clear that we are living in a New Gilded Age. This time however, it is a global one, dominated by multinational monopolies that are more powerful than those of the past, which — if left unchecked — can lead to a future more dystopic than most think.
Understanding history: the first Gilded Age
To understand our current Gilded Age, it is important to look at the past. From the 1870s up until the early-mid 1900s, the US was going through a phase which was later dubbed “The Gilded Age” by famous writer Mark Twain. This epoch was characterized by its rampant poverty, economic inequality and a destruction of nature caused by corporate greed.
The American economy at that time was a strange combination of unrestricted “Cowboy Capitalism” and what was left of Hamiltonian thought. The economy was dominated by large monopolies (also known as trusts) which were headed by the Robber Barons. These Robber Barons used their extreme amounts of wealth and illegal practices such as labour union-busting, fraud, intimidation and violence to keep ahead of their competitors. By doing so, the Robber Barons consolidated large monopolies in their respective sectors. Rockefeller had Standard Oil, J.P. Morgan had banks and railroads, Carnegie had the steel industry, and so forth.
To keep costs low and profits high, the Robber Barons would squeeze their workers and force them to work long hours in unsafe conditions for low wages. Any attempt to change this, be it via labour unions or other ways, would be suppressed by the Robber Barons, often violently. And it was not just the workers who were being squeezed. Small business owners, farmers and the competitors of the Robber Barons would be squeezed (or sometimes even crushed) by the power of the monopolies. Many small farmers ended up having to close down their farms and sell their land because the railroad monopolies were overcharging them when they tried to have their products shipped via train, preventing them from paying back their loans to the big coastal banks, which would leave behind many farmers and their families to live in squalor. Much of America’s natural beauty was also destroyed by corporate greed during this period. The trusts and other big corporations cut down whole forests and destroyed many once-fertile lands in order to make way for the railroads and other business ventures. The coal-powered factories would also pollute America’s industrial cities and surrounding countryside.
It was clear that America was going through a troubled period. But America’s problems, and the power of the Robber Baron’s in particular, remained largely unchallenged because of the rampant corruption plaguing Gilded Age politics. The Robber Barons used their wealth and extensive political connections to lobby for their own interests and convince (or more simply bribe) politicians to pass policies that favored their interests.
This troubled epoch would come to an end at the turn of the century when a young politician by the name of Theodore Roosevelt ascended to the role of president after his precursor, William McKinley, was assassinated by an anarchist terrorist. Upon becoming president, Theodore Roosevelt committed himself to address America’s problems and ensuring genuine progress for the nation. Roosevelt would start a campaign to break up America’s biggest trusts, which curbed the power of the Robber Barons. He also addressed the poor situation of America’s working-class by pushing for higher wages, better working conditions, and safe foods and medicine (which were of notoriously low quality during the epoch). Roosevelt was also a committed conservationist and an avid outdoorsman, who was horrified by the state of America’s natural beauty. To stop the decline of America’s environment, Roosevelt used his executive authority to open new national parks. At the end of his term, Roosevelt would end up conserving 930,000 square kilometers of American nature.
Roosevelt’s presidency would bring an end to America’s Gilded Age and usher in a new wave of progressive politics, which would be followed by the even more progressive (in economic terms) New Deal-era, and it seemed as if America would develop into a social-democratic welfare state like its counterparts in Europe. All would not last however.
Our New Gilded Age
America’s New Deal-era and the Keynesian dominated Post-War Consensus in Europe and the rest of the developed world would come to an end when at the start of the 1980s, both the US and the UK would elect neoliberal leaders (Reagan in the US and Thatcher in the UK) whose ideas and politics (in combination with influence from big business-funded academics and think tanks) would influence politicians across the rest of the developed world to follow suit.
The 40 years of neoliberal politics that followed gave back a lot of power to big corporations and their financial backers. Soon, multinational firms would consolidate (near) monopolies, and the problems so prevalent during the first Gilded Age (poverty, economic inequality, pollution, and monopolies) would make a return across the developed world.
Just as the American economy was controlled by a handful of powerful monopolies during its Gilded Age, our contemporary world economy is dominated by a handful of (near) monopolies. The biggest of these monopolies are not merely monopolies on a national level, but also on a global level. These multinational monopolies and their ultra-rich owners such as Jeff Bezos (who can be seen as modern robber barons) crush their competitors by squeezing their own workers and suppliers. Similar to how the small farmers were squeezed by the railroad monopolies during the first Gilded Age, restaurants and small family businesses are now being squeezed by the Big Tech-platform monopolies such as UberEats. With this increase in power of big corporations and the ultra-rich, problems of poverty, economic inequality, and the destruction of the environment by corporate greed have also returned.
One would think politicians would do something about forces undermining their nations and the issues they cause for their nation’s citizens. No serious political action has been taken however. The reason for this is similar to the reason for the American government’s inability to address the problems during the Gilded Age: the power and political influence of the monopolies is too big. By using their money and connections, the big monopolies can successfully lobby politicians to implement policies that are in their interest or prevent politicians from implementing policies that would harm their monopolistic position. Another devious tactic that the monopolies (and big multinational corporations in general) use is encouraging a race to the bottom between different nations. Big corporations will tell countries to lower their taxes and cut business regulations, under the threat that if these countries do not want to comply, the companies will move to other competing countries, creating a loss of economic growth, tax incomes, and jobs. Then there is the issue that governments taking on the big monopolies have themselves become dependent on the services provided by these monopolies. This can be seen most clearly with the Big Tech-monopolies such as Facebook and Twitter, who can (and have) use their power to silence politicians who use their platforms (which is every serious politician) by removing their posts or even banning them
Final Destination: Neo-Feudalism?
If the governments of our individual nation-states do not take control and turn the tide by keeping our era’s Robber Barons in line and break up their monopolies, the end result can be far more dystopian than most think. What will emerge is an almost Neo-Feudal society in which Big Tech, multinational corporations, international finance, and the ultra-rich elite have completely rigged the system in their favour and are able to decide everything about the politics, economics, culture, and norms and values of both the individual nation-states and the world as a whole.
In this society, the governments of the individual nation-states in much of the developed will lose their relevance and be overtaken by the power of the new Robber Baron’s and their corporate monopolies. The common man will be doomed to an existence of wage labour and mindless consumption, without having much of a say about the world around him, nor having many opportunities to change it, due to the control of the big corporations and their political allies. The already large divide between the rich and the rest of society will only widen, and the influence of the monopolies over markets, culture, and norms and values will be increased. This will in turn lead to even higher levels of polarization, poverty, environmental degradation, and worsening worker’s rights. And it will not just be society in general that will be impacted, but also the individual lives of people. With their control over the personal information of most people, Big Tech-companies will be able to control people’s lives without much restraint and a state of constant surveillance will become the norm.
World politics will also be significantly impacted. The world will most likely be split between a western sphere dominated by international corporate monopolies and their political allies on one side, and a strong People’s Republic of China and China’s sphere of influence on the other side. These two sides will be locked into a strange state of both awkward cooperation and fierce competition over the developing world’s natural resources, with conflict always looming on the horizon.
To prevent this dystopic future from becoming a reality, change is needed.
A change of course: How we can take back control
To curb the power of the Robber Barons, their monopolies need to be broken up. In the case of national monopolies, this should be done by national governments themselves. However, in the case of international monopolies, the process of breaking up these monopolies can only be achieved through a combined effort of the governments of individual nation-states to break up these monopolies and in turn re-assert their own power. Lobby groups should also be better regulated on both the national and international level, to curb the power of big business over politics and ensure a level playing field for citizens and other interest groups (e.g. labour unions).
On a national level, governments should also re-assert control over the economy. Governments should seek to better regulate their local economy to maintain a fair form of market competition and prevent the destruction of nature and the environment by reckless corporate practices and overconsumption. To deal curb the increase in poverty and economic inequality, governments should implement better laws for worker protection and ensure a fairer distribution of wealth, incomes, opportunities, and knowledge, as this will help increase social mobility within society.
This is why we need a new generation of Theodore Roosevelt’s, willing to break the power of the new Robber Barons and steer our nations away from a dystopic future, and instead set a course towards a better future for our families, communities, and nations.
