The Gilded Age, the 1920's and the 1980's Compared

The Ten Major Characteristics of Republican

Business, Financial and Political Heyday periods

 

                                    Gilded Age                 Roaring Twenties            Nineteen Eighties

Conservative politics

All Presidents were Republican except Grover Cleveland

All Presidents were Republican

All Presidents were Republican

Reduced role for government

Zenith of laissez-faire and limited government

Significantly reduced regulatory and antitrust enforcement

Deregulation, privatization and reduced government regulatory and antitrust enforcement

Difficulties for labor

Strikes and widespread labor violence

Anti-union pressure grew; the AFL-CIO and the big coal and railroad unions lost members

Declining labor union membership and power

Large-scale economic and corporate restructuring

First trusts organized in 1880s; merger and consolidation wave; rise of great corporations

Merger wave; organization of first investments trusts; era of Samuel Insull and public utility holding companies

Merger wave; rise of giant pension funds; emergence of junk bonds and leveraged buyouts

Tax Reduction

End of Civil War income tax in 1872; Civil War taxes effectively removed in favor of reliance on tariff

Top personal income tax rate reduced from 73% to 25%; other taxes also reduced or eliminated

Top personal income tax rate reduced from 70% to 28%; other taxes also reduced

Disinflation or deflation

Hard currency and tight monetary policy; prices declined; high real interest rates

Gold Standard; prices steady (but commodity prices sank); high real interest rates

Tight monetary policy; inflation reduced (commodity prices sank); high real interest rates

 

 

 

 

Two tier economy

Difficult times in agricultural, and mining areas; good times in emerging industry, service and financial centers

Difficult times in agricultural, energy and mining areas; good times in emerging industry, service and financial centers

Difficult times in agricultural energy and mining areas; good times in emerging industry, service and financial centers

Concentration of wealth

Large increase in number of millionaires; 3-5% more of U.S. total income concentrated with top 1 %

Zenith of 20th century U.S. wealth concentration; top 1% Americans had 40% of U.S. wealth

Large increase in millionaires and billionaires; 3-4% more of U.S. total income concentrated with top 1%

Increased debt and speculation

Major increase in individual, corporation and foreign debt; US railroad bonds sold to British were that era’s junk bonds

Introduction of installment buying and purchase of stocks on margin; international debt questions; massive expansion of personal debt

Ballooning of personal and corporate debt; innovative debt instruments; surge of US budget deficit; emergence of US as world’s leading debtor

Speculative implosion

Panic of 1893 and subsequent depression

Crash of 1929 and subsequent depression

Crash of 1987, mini-crash of 1989 and relevant events of the 1990s