The Second Gilded Age: the Revenge of the New Robber Barons

The 2024 election witnessed the return of a new generation of robber barons exemplified by Elon Musk.  With the exception of a global vs nation reach, they are – sadly — little different from the original generation of robber barons of a century-plus ago.

In 1859, Henry J. Raymond, editor of The New York Times, made a comparison between Cornelius Vanderbilt, the railroad tycoon, and “those old German barons, who from their eyries along the Rhine, swooped down upon the commerce of the noble river and wrung tribute from every passenger that floated by….”

The notion of “baron” stuck and, in time, it was joined by “robber” to forge a new concept, the “robber baron,” to define a group of powerful individuals destroying competitors, controlling markets and shaping the nation’s economy.  Other robber barons included Jay Gould (railroad and finance), Andrew Mellon (finance), Andrew Carnegie (steel) and John D. Rockefeller (oil). Over time, their rapacious reputations were whitewashed by charitable foundations, university buildings and hospital wings.

In 1873, Mark Twain and Charles Dudley Warner published The Gilded Age: A Tale of Today, a popular work that satirized the greed and political corruption of the then modern era.  The term “gilded age” stuck, signifying a period lasting from the 1870s to 1910s.

Working with other corporate buccaneers and backed by unscrupulous speculators, the tycoons of old formed giant trusts that monopolized the production and distribution of essential goods.  Economic power fostered political influence.  The robber barons controlled Washington, D.C, politics as well as many state and local governments.  While they engaged in private gluttony, they imposed social and moral tyranny on the poor, workers and new immigrants.

The robber-baron elite, and their well-paid accolades, whether political, theological or media puffers, proclaimed an ideology of self-reliance and primitive individualism.  Sadly, deepening despair was intensifying among those most squeezed by the new economic order.  For men, factories, mines and farms were slave pits; for women and children, many worked under torturous conditions, including laboring to 12 to 16 hours per day for pennies. In 1886, the American Federation of Labor was formed to fight for skilled laborers.

Class war was the ghost that haunted the Gilded Age.  It was a period of rapid industrialization and urbanization, marked by a large influx of immigrants from eastern Europe and Asia along with African Americans migrating from the South to the North.  Political corruption was rampant, with businessmen bribing public officials at all levels of government and political machines, like Gotham’s legendary Tweed Ring, turning elections into winner-take-all scams.

The robber barons ruled during what is known as first Gilded Age and were driven by the arrogance of a new economic order, one based on the opportunities of industrialization and the vast wealth to be garnered.  It spawned a new buccaneer class of capitalists like none-other that preceded them.  While warnings were raised by muckrakers like Ida Tarbell and Lincoln Steffens, the robber barons of the first Gilded Age could claim ignorance as to the consequences of their arrogance, their personal greed and political connivances.

Today, Vanderbilt’s and Rockefeller’s corporate descendants include, in addition to Musk, Amazon’s Jeff Bezos and Meta’s Mark Zukerberg, among many others. They rule during what can be called the “Second Gilded Age.” Today’s “Big Tech” companies are giant, global conglomerate that include Alphabet (Google), Amazon, Apple, Meta (Facebook) and Microsoft. But there is also Big Phama — i.e., Johnson & Johnson, Roche Holding, Pfizer, Novo Nordisk and Eli Lilly; Big Oil — i.e., Shell, ExxonMobil, BP, Chevron, and ConocoPhillips; Big Tobacco — i.e., Altria, Philip Morris International and British American Tobacco; and Big Telecom — i.e., AT&T, Verizon and Comcast.  Collectively, they have transformed the U.S. economy into a cartel nation.

The new new robber barons are driven by a combination of greed and political cunning that enables them to have considerable influence, if not control, over the federal and state governments throughout the country.  Like the robber barons of old, today’s barons engage in ruthless business and political practices and are masked, like the flesh of a fan dancers, by their support for major bourgeois cultural institutions.

Perhaps most disturbing, as of 2023, the top 1 percent of American households owned 30.0 percent of the nation’s net worth – estimated at $43.0 trillion.

The wealth of the rich and super-rich is compounded by the shift in the global economy, from the long standing “unipolar” world order with the U.S. at its center to a “multipolar” with the U.S. challenged by China and others. As John Mearsheimer argued, the “change in the balance of power has created a situation where we’re moving away from unipolarity and toward multipolarity.”

The 2024 elections brought to the public stage this new generation of robber barons. OpenSecrets estimates that the 2024 election “is on track to be the costliest ever, with a total cost of at least $15.9 billion in spending. This will surpass the 2020 cycle’s record-smashing total of $15.1 billion.” The 2024 election was a money fight among today robber baron billionaires.  Even more significant, Forbesreports that 83 billionaires supported Harris compared to 52 billionaires who backed Trump. And this does not include the numerous millionaires who contributed to the campaigns.  No no matter who won the election, the new robber barons bought the election.

Most troubling, many new robber barons strongly back cryptocurrency junkies. In 2019, Trump wrote on Twitter that bitcoin was “not money” and criticized it as “highly volatile and based on thin air.” Going further, he insisted, “We have only one real currency in the USA, and it is stronger than ever. It is called the United States Dollar!”

During the campaign, Trump changed his bitcoin tune.  In August, it was reported that he had $1 million in crypto.  Backed by Musk, a leader in cryptocurrency, and received $7.5 million from crypto backers, he declared: “For too long our government has violated the cardinal rule that every bitcoiner knows by heart: Never sell your bitcoin.”  He then pledged: “If I am elected, it will be the policy of my administration, United States of America, to keep 100% of all the bitcoin the U.S. government currently holds or acquires into the future.”

https://www.cbsnews.com/news/trump-income-wealth-financial-disclosure-forms-bible-sales-crypto-nfts/

Cryptocurrencies are private digital assets that are not controlled by any central authority, thus potentially challenging the dominance of the U.S. dollar and the U.S. financial system.  As one analysis noted:

“Cryptocurrencies provide an alternative to the dollar – and to foreign exchange in general – that is not subject to the same political and regulatory pressures. This is because cryptocurrencies are decentralized, meaning that they are less vulnerable to political interference, such as government manipulation of interest rates or currency controls.”

Trump’s new-found embrace of cryptocurrencies sets the stage for financial hucksters to roll the dice on the U.S. economy.

Equally troubling, the new robber barons have increasingly taken control of American media.  In the old days, Hearst owned 28 big-city newspapers, a syndicated wire service, radio stations, newsreels and 13 magazines.  Today’s moguls are far more dominant as traditional newspaper media is being eclipsed by online streaming services.  The shrinking traditional media are exemplified by the owners of the Washington Post (Amazon’s Bezos) and The Los Angeles Times (biotech entrepreneur Patrick Soon-Shiong) ordering their editors of the respective papers not to endorse VP Harris.  Still other robber barons with media holding include:

+ Musk acquired Twitter and rebranded it X;

+ the financier John Henry purchased The Boston Globe;

+ older new money barons Rupert Murdoch controls News Corp., Michael Bloomberg runs Bloomberg LP and Bloomberg Media, Sheldon Adelson acquired The Las Vegas Review-Journal, and Marc Benioff (who runs Salesforce) bought Time magazine;

+ Laurene Powell Jobs, wife of Apple’s founder Steve Jobs, owns The Atlantic.

 A century ago, Teddy Roosevelt and the Progressives waged war against growing inequality and the rise of trusts and cartels.  They battled the shameless practices of the old robber barons.  Sadly, there is no Roosevelt taking up the challenge today.

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