the 90 years from 1860 to 1950 were nearly total in that they almost completely changed who had wealth and
power from the boom to the unimaginable busts, wars, and redistributions. More specifically, after the US Civil
War ended in 1865, the US joined other major Western countries in having great productivity, prosperity, and
wealth creation.16 This period was known as the Second Industrial Revolution. That was when the “robber
barons” such as John D. Rockefeller, Cornelius Vanderbilt, Andrew Carnegie, and J.P. Morgan accumulated vast
fortunes, which led to popular reactions against them and their powers. This period was also called the Gilded
Age in the US, the Victorian Era in the UK, and the Belle Époque in France because of the decadent
spending that set in motion the revolutionary changes that started gradually and then accelerated to wipe
out or redistribute virtually all wealth by 1950.
For example, in the US, strikes first began in the 1880s, the Sherman Antitrust Act was passed in 1890 to break up
monopolies and was increasingly used to break up companies, and the debt-bubble-induced depression of 1893
raised tensions especially as money was kept hard (i.e., tied to gold), so in 1896 a populist—William Jennings
Bryan—emerged and campaigned for the presidency on the platform of breaking the link with gold, printing
money, and distributing it liberally. Bryan wasn’t elected. Theodore Roosevelt became president in 1901, and
“muckrakers” in the mass media led to investigative journalism that helped stir up the public and was used by
Roosevelt to make reforms. A new political party, the Populist Party, and the Progressive movement came into
existence in support of a number of actions to deal with industrial and labor issues, trust busting, food and drug
quality, women’s suffrage, etc. In 1913 the 16th Amendment to the Constitution allowing a federal income tax was
passed. From that point of having no taxes to speak of, the top marginal tax rates increased to around 70-80% for
both income and estate taxes. In the 30 years from 1914 and 1944, there were two world wars and the global
depression, which led to the creation of a lot of debt that had the interest rates on it legally capped while all
major currencies were delinked from gold, gold ownership was outlawed, the abilities to take money out of
most countries were eliminated, and price controls on rent and other items were created. Then central
banks printed a lot of money, which produced a lot of inflation, sharply reducing the real value of fixed-
income and equity assets. Additionally, in most countries (especially in Europe) businesses were
expropriated or nationalized, and the war damage destroyed a lot of property. Capitalists and capitalism
were widely blamed and hated especially as a result of the stock market crashes and depressions, so many of
them were killed.17
Those revolutionary changes in wealth and power that took place within the system that we looked at, are still
studying, and by and large were driven in this archetypical way are:
1828 US Election: Andrew Jackson—Conservative populist, refused to renew the charter of the US’s central
bank (Second Bank of the US).
1860s Russia: Abolition of serfdom.
1880s Germany: Otto von Bismarck’s social legislation.
1890s-1920s: The Progressive Era—Trust busting, anticorruption, scientific thinking.
1906: Theodore Roosevelt introduced progressive estate taxation and, in 1909, the income tax.
1908 UK Election: H.H. Asquith’s passage of big tax hikes and the major welfare reforms that led to the
emergence of the modern welfare system in the UK.
1912 US Election: Woodrow Wilson—First Democratic president elected in 20 years, second in 55, which
kicked off big tax changes and reform.
1920: The women’s rights movement led to the 19th Amendment of the US Constitution, which gave women
the right to vote.
1932 US Election: FDR’s move to the left—Upon election, Franklin Roosevelt immediately devalued the
dollar to produce debt relief and implemented sweeping reforms on an unprecedented scale. His New Deal
policies sought to tackle the economic depression through a vast expansion of the role of government and
support for workers, debtors, and the unemployed. He created Social Security and unemployment insurance,
increased financial regulation, created large government programs that directly employed people, and
strengthened labor rights.
1936 French Election: Blum’s move to the left—Léon Blum passed a slew of labor reforms that gave workers
increased rights, better working conditions, and higher pay.