Blog Post #2 The Provenance of America's 2nd Gilded Age

As mentioned in my first blog post, we are in the 2nd Gilded Age. For the 99% of us, it’s a scary
time. We’ve been here before. Unfortunately, the U.S. goes through cycles of crisis and recovery
and then promptly forgets that history. Lasting economic change requires a full accounting of
what happened.


It all started in the 1950s. During World War II, people around the world saw the horrors of
racism, racial hierarchies and inequality. In the U.S., racial hierarchies remained ingrained after
the Civil War thanks to Jim and Juan Crow laws. An increasing backlash to the oppression of
minorities and women and lack of opportunity spurred the creation of the Civil Rights movement
and pushed the Supreme Court under the Warren and Burger Courts to expand rights under the
scope of the 14th Amendment. President Lyndon Johnson worked with Civil Rights leaders to
pass the Civil Rights Act of 1964.


Following these advances came the inevitable backlash. The segregationist Southern Democrats
switched party affiliations to join the Republican Party. In 1971, Lewis Powell, then a lawyer for
the U.S. Chamber of Commerce, wrote the infamous Powell Memo. It said that the American
population had turned against corporations as they passed consumer protection and civil rights
laws and it outlined ways in which big business could fight off regulations and infiltrate
institutions to influence public opinion. The groundwork was laid for the pro-business
accelerant: Reagan.


Reagan was the turning point. Before him, postwar American presidents upheld the philosophy
that the government should build infrastructure, regulate commerce and provide a social safety
net. Reagan and his advisors rejected that. They dismantled common-sense regulations and
slashed tax rates for the wealthy, which moved wealth dramatically upwards. Corporations
successfully lobbied to jettison limits on campaign funding. They slashed costs by offshoring
manufacturing. Repealing limits on campaign funds and obliterating American manufacturing
left the Republicans with the age-old problem for right-wing parties: how to cater to their base
and their big donors. The modern Republican Party is failing to manage this problem. They are
catering to their big donors by cutting taxes and regulations while evoking racial grievance,
racism, conspiracy theories and cultural issues to keep their base supportive. Former President
Trump is the most stark example of this phenomenon. This approach is not only economically
ineffective, it also undermines democracy at home and around the world.


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