Imagine a child entering a playground. She sees a high slippery slide and climbs painstakingly up the steps. She pauses to take a breath and then speeds down to the ground. The child began and ended at the same place—the bottom—but the ascent and descent were profoundly different experiences. Such is the situation with the so-called first and second Gilded Ages. Some argue that we have entered a new Gilded Age, based on obvious parallels between the United States since 1990 and the decades of the late nineteenth and early twentieth centuries—for example, severe inequality, the absence of labor rights, and anti-immigrant sentiment—but the comparison is profoundly misleading. Although both periods saw major transformations of capitalism, during the Gilded Age, human and labor rights expanded—slowly to be sure—as men and women fought to limit the power of capital. The ascent toward expanded rights and protections was hard fought and involved many contradictions and tensions among those determined that capital not be omnipotent. But through a wide array of strategies and tactics, ranging from labor unions to socialist and anarchist organizations, communist and anti-colonial revolutions, and liberal movements to expand the welfare state, the coercive power of capitalism had been somewhat curbed by the mid-twentieth century. The late twentieth and early twenty-first centuries, on the other hand, witnessed the rise of a neoliberal order characterized by austerity, privatization, and extremely effective attacks on labor rights. This transformation was triggered in part by a crisis of capitalism in the 1970s, but it was also made possible by the collapse of the Soviet Union and China's embracing of global capitalism. The end of those two major alternatives to capitalist hegemony dealt a crippling blow to subaltern movements to oppose or limit the power of the capitalist economic order. The result has been a profound descent as fundamental rights for working men and women and protections for those at the socioeconomic bottom have disappeared. Rather than repetitions, the two “Gilded Ages” are in fact bookends—a before and after—to a lengthy period in which the cruelest characteristics of corporate capitalism were temporarily constrained. Focusing in on the history of labor and the working class in the two periods and taking a global perspective demonstrates that the distinct trajectories at play make all the difference.

Consider first of all how differently the transformation of capitalism has played out during the two periods under consideration. During the late nineteenth century, the United States experienced the rise of industrial corporate capitalism and spectacular economic growth. Capitalist expansion was aided by the vast amount of land and natural resources available—which were in turn made accessible due to massive waves of settler colonialism and the genocide of native peoples. Technological innovations further deepened corporate managers’ ability to accumulate capital. The modern corporation as a legal personality evolved first in the United States, paving the way for American global capitalist domination later in the twentieth century. As Perry Anderson has noted, the brilliance of the United States in the nineteenth century lay in its creation of “a juridical system disembedding the market as far as possible from ties of custom, tradition, or solidarity …,” which in turn made possible unencumbered property rights.Footnote ¹ By 1900, the United States was the premier industrial capitalist society on earth. Yet its achievements had come at great cost, with repeated economic crises, widespread unemployment, and rapidly rising inequality.

The expansion of corporate capitalism in the nineteenth century and the proletarianization, deskilling, rising inequality, and widespread corruption accompanying it generated massive protest, mobilization, and upheaval in the United States The late nineteenth century was rocked by community-wide uprisings: the 1877 insurrection, the Great Upheaval of the 1880s, the Homestead strike in Pennsylvania in 1892, and the Pullman Boycott of 1894, among others. Modernization of agriculture and the dominance and corruption of eastern financial and capitalist interests generated a robust protest movement among farmers. The growth of capitalism around the world meant that protest and resistance in the United States was shaped by global social movements as well. Small, struggling socialist and anarchist organizations emerged and then generated a series of communist revolutions around the world (the most significant of course being the Russian Revolution of 1917). Together these shattered the hegemony of capitalism. Although the United States did not succumb to socialist revolution, the example of the Soviet Union and the critique it offered of harsh, unfettered capitalism encouraged liberals and radicals to push for a transformation of government policies in order to provide at least a modicum of protections for those most vulnerable: working men and women, the poor, children, the unemployed, and the aged. By the 1930s, legislation such as the National Labor Relations Act (1935), the Fair Labor Standards Act (1938), the Social Security Act (1935), and countless others had vastly expanded labor rights and protections for all these groups. These were not simple transformations. In the United States, one might argue that the expansion of the liberal state coopted and defanged the militancy and anti-capitalism that industrial workers had demonstrated through their protests. But there can be little debating the fact that by the 1930s, capitalism had been made slightly more humane, workers had won the fundamental right to organize, and there existed moderate protections for the unemployed, the impoverished, and the aged.Footnote ²

The post–World War II decades saw the rise of U.S. global power, including but not limited to the increasing global domination of U.S. corporate capitalism. Yet the Keynesian approach to industrial capitalism experienced major turmoil in the 1970s, leading to a global economic crisis. The causes included declining corporate profitability, due in part to the success of social movements in restraining capitalism as well as increased competition from Japan and Germany, financial instability, and OPEC's spike in energy prices. Overcoming the combination of high unemployment and inflation was achieved, simply put, via a realignment of class relations. By the 1980s, as the economic order emerged from this crisis, capitalism would be transformed and U.S. global economic power would be reinforced. The Federal Reserve imposed the highest interest rates in history—the so-called Volcker Shock—in order to bring interest rates under control. This led to very high unemployment rates and made defeating labor much easier. It was accompanied by deregulation of the banking industry, a new alliance between the finance and industrial sectors, and ultimately a restructuring of capitalism altogether. Often referred to as neoliberalism, the new formation of capitalism since roughly 1990 has been characterized by a rejection of Keynesianism, a new dominance of the financial sector, privatization, austerity, and a major clampdown on labor rights and social protections. As David Harvey phrased the transformation, a “restoration of class power” had become seen as necessary and overdue.Footnote ³

Since the interventionist role of the central state was critical in this transformation, the neoliberal order should not be thought of as a return to laissez-faire economics, but rather as a class realignment that unleashed the harsher aspects of capitalism. From the 1980s onward, one by one many of the consumer and labor protections that had constrained corporate profits were eliminated. Consequently, much of the safety net for vulnerable members of society disappeared. Globally as well as in the United States, we have witnessed the rise of more conservative governments, the extension of additional rights and powers to corporations, and the elimination of protections that curbed corporate misbehavior. As in the late nineteenth century, we have returned to high levels of inequality and poverty, but as this brief summary of the transformation of capitalism suggests, the underlying dynamics are quite different.

Global politics also played a role in these transformations. In our current era, capitalism has much greater hegemony and restraints on its power and cruelty are slipping away; it is now clear that the existence of powerful and profound alternatives to capitalism—particularly in the form of the Soviet Union as well as social and labor movements inspired by such alternatives—Had been a central causal agent. The possibility of a socialist or communist alternative forced governments in the capitalist world to be much more cautious and thoughtful about their citizens’ needs. It helped encourage radical and liberal protest in the United States that forced governments to respond. Crueler forms of capitalism and the severe exploitation and inequality accompanying them could generate dangerous upheaval, and the successful communist revolutions of the twentieth century served as a forceful reminder that capitalism's hegemony could not be assumed. It is no accident that the “second Gilded Age” is often seen as emerging around 1990—in other words, right at the moment when the Soviet Union fell apart, at last ending the greatest challenge to capitalist hegemony in global history.

The Russian Revolution is now dead and gone. We have entered a period of unlimited property rights, one in which capital and corporations have more freedom than most humans. Capitalism today is ungloved and social needs can be subjugated more fully to the power of capital. In this sense, the turns of the twentieth and twenty-first centuries bookend a long historical moment in which capitalism's hegemony was profoundly challenged, and therefore capitalist societies, including the United States, were forced to smooth the rough edges of their free market systems. For a while, capitalism bowed to the needs of civil society. The first Gilded Age saw an acceleration of efforts to rein in capitalism. In the twenty-first century, the world is experiencing the denouement of a victorious capitalism flexing its power. At the same time, U.S. elites are facing other challenges that complicate the story: global challenges to U.S. economic power, particularly from China; and challenges to the hegemony of whiteness in the United States as a result of long-term demographic transformations. The latter in particular is giving a racial and ethnic dynamic to the new power of capitalism across the United States.

Conceptualizing the periods as bookends allows us to highlight the distinctive dynamics at play in each case. Consider the case of labor rights and the working class. In each period, the working class underwent transformation and recomposition. In the Gilded Age, more and more workers entered industrial environments. Skilled industrial workers came of age possessing knowledge of the production process that, combined with their exceptional abilities, made them accustomed to exerting some control over the workplace. Yet their power was increasingly challenged by employers able to deploy technological improvements, increased division of labor, and access to cheaper labor as immigrants, women, and African Americans entered the workforce. As the number of semiskilled and unskilled industrial workers increased, and as the service sector expanded (particularly in the white-collar sector), the dominance of skilled workers over the entire working class slipped away.Footnote ⁴ The explosive battles of late nineteenth-century labor history were fueled by skilled workers seeking to maintain their power amid the challenges posed by technology, transformations of the work process, and new sources of less expensive labor. A newly ascendant corporate capitalism, often aided by state coercion, itself faced a difficult economic landscape as depressions and recessions combined with a long deflationary cycle to push many employers into bankruptcy. Corporate leaders responded by fighting to bring skilled workers under control. The resulting recomposition of the working class would not be completed until decades into the next century, but during the Gilded Age the inauguration of these dynamics generated the era's most forceful critiques of unfettered capitalism. We can see this in uprisings such as the insurrection of 1877, in the rise of socialist and anarchist organizing, and in the ascent of the Knights of Labor and the American Federation of Labor (AFL).Footnote ⁵

Workers’ critiques of capitalism during the late nineteenth century emerged from many different sources. A central influence was a moral economy that saw rights and sources of power guaranteed to them by republicanism being stripped away. Producerism and the labor theory of value—the idea that at the heart of the republic stands the honest producer who is creating wealth, who should therefore be respected and valued—helped ensure that skilled workers would respond angrily when employers assaulted their power. However, those same values often prevented skilled workers, most of whom were white men, from feeling solidarity with less skilled workers who were more often black, immigrant, and/or female, since (consciously or unconsciously) the former conceived of themselves as the true and valid producers. Meanwhile, new forms of labor and political organization emerged in response to the power of corporate capitalism. The Knights of Labor dominated labor organizing until its demise in the Red Scare that followed the 1886 Haymarket incident. As the Knights declined, the business unionism of the AFL rose to prominence. By the early years of the twentieth century, as the nation recovered from the great depression of the 1890s, the AFL's fierce labor militancy provided its mostly skilled members with unprecedented strategic and financial resources, providing a better shot at fighting back against employers’ attacks. Indeed, for all the attention historians give to workers’ troubles and the weakness of the labor movement during the Gilded Age, it is important to remember that this was a period when the labor movement was growing stronger, albeit incrementally. Wages overall rose during the late nineteenth century, as did the number of workers benefitting from union membership—and strikes led by unions were much more likely to succeed.Footnote ⁶ Yet the AFL's growing prominence also reinforced divisions within the working class. Its emphasis on craft unionism favored white male workers who possessed skills over semi- and unskilled industrial workers more likely to be female, black, and/or immigrant.

Meanwhile radical ideologies pervaded the U.S. workers’ movements of the Gilded Age and robustly challenged the new capitalist order. Even though socialist and anarchist organizations struggled throughout the late nineteenth century, they shaped the broader working-class movement, gave more ferocity to labor protests, and by the early twentieth century emerged as a major impulse in American political culture.Footnote ⁷ Even activists like Samuel Gompers and Adolph Strasser, who rejected socialism by the end of the nineteenth century, cut their teeth and developed a strong sense of class militancy amid the radical milieu of the 1870s and 1880s. Furthermore, during the Gilded Age, American radicalism was tightly connected to and influenced by global—particularly European—socialism. German radicals fleeing after the failed 1848 revolution, such as Joseph Weydemeyer and Wilhelm Weitling, brought Marxist ideas and organizing tactics to the United States. Another influx of German immigrants in the 1870s and 1880s led to formation of the Workingmen's Party in 1876, which soon changed its name to the Socialist Labor Party (SLP) and rose to become the most influential socialist organization in the United States.Footnote ⁸ The strong German ties of American radicals during the Gilded Age proved both a strength and a weakness: connections to Germany and tight camaraderie among German immigrants inspired and energized the movement, but activists often seemed more knowledgeable about the mood of workers in German cities than that of their non-German counterparts in the United States. Enduring tensions, especially whether to focus on political or union mobilization, weakened the organization. As the SLP focused more on political tactics, activists like Lucy and Albert Parsons drifted toward anarchism. Organizational tensions aside, when looking at the urban level, it is hard to miss the rich importance of radicalism, whether it leaned toward Marxist, Lassallean, or anarchist approaches. In Chicago, Milwaukee, Cincinnati, and many other cities, the ascendancy of corporate capitalism was matched by a growing radicalism that critiqued the very foundations of the new social order.Footnote ⁹ In the early twentieth century, these diverse radical strategies and ideas would bear fruit in a multitude of reforms, increased political power (especially at the municipal level), and the growing strength of the labor movement. Socialists achieved more unity with the founding of the Socialist Party of America in 1901, while anarchism remained a vibrant alternative, as seen in the emergence of the Industrial Workers of the World in 1905. And as the progressive movement expanded, radical and populist activists saw many of their best ideas adopted by middle-class reformers.

Second Gilded Age conceptualizations often erroneously suggest that the harsh political landscape of the early twenty-first century will lead once again, as it did at the turn of the twentieth century, to a new spirit of progressive reform and increased welfare for all Americans. This is precisely where conceptualizing the two periods as bookends rather than identical repetitions is helpful. A global perspective is also warranted. The Russian Revolution of 1905, like the Paris Commune decades earlier, excited radicals around the world and gave ammunition to their criticisms of the new capitalist order. European governments responded with a range of welfare measures intended to forestall further unrest or revolution. The United States took less action in that direction during the early twentieth century, but with the Russian Revolution of 1917, combined with intense working-class unrest amid the economic crash and the Great Depression, the federal government finally moved to curb the worst excesses of the capitalist system and ensure a basic safety net of welfare—unemployment insurance, social security, etc.—for all citizens.Footnote ¹⁰ In other words, as grim as the Gilded Age was in terms of inequality, few labor rights, failure of the political parties to restrain the power of capital, and so on, the historical dynamic was toward ameliorating those problems. The amelioration, however limited, demonstrated a clear direction: gradually more union members, not fewer; more laws protecting the rights of workers and consumers, not fewer; more measures to soften the existing inequality (such as the constitutional amendment providing for an income tax), not fewer.

Surveying the working class in the late twentieth and early twenty-first centuries reveals parallels with conditions one hundred years ago. The organized labor movement is in bad shape, inequality is high, and, as at the turn of the twentieth century, the working class has been transformed in recent decades. A combination of deindustrialization, capital flight, expansion of the service sector, and the rise of the gig economy have together transformed workplace struggles, giving rise to a far more vulnerable working class. The concept of the “precariat,” as coined by Guy Standing, refers to a precarious proletariat that faces unreliable work assignments, little or no job security, endemic underemployment, low wages, and little or no room for advancement.Footnote ¹¹ The relatively highly paid industrial workers who benefitted from the heyday of both the New Deal and the high point of the union movement now compose a fraction of the working class. In addition to these structural changes, the demographics of the working class has changed significantly in the last four or five decades. The Civil Rights Act of 1964 helped open up jobs (and unions) to women and ethnic and racial minorities. At the same time, the Hart-Celler Immigration and Nationality Act of 1965 increased immigration from Latin America, Asia, and Africa, making the working class much more diverse. Pundits continue to conceptualize “American workers” as white men, but that is increasingly inaccurate. The American worker today is most likely female and of Asian, African, or Hispanic descent. She probably works in home health care or food service. And in most cases, she does not benefit from union representation.Footnote ¹²

It is tough to organize a union now, just as it was circa 1900. But there the similarity ends. In the late nineteenth century, union mobilization was on the rise (although it was certainly a tough struggle since workers lacked basic labor rights). Ferocious battles erupted in the 1970s and 1980s as workers fought at the shop floor to retain their hard-won gains of previous decades and their union power. But the class realignment discussed above combined with a new cottage industry of anti-union consultants and corporations willing to break the law (knowing that even if penalized, the small fine would be worth it) meant that by the mid-1980s, the working class and its labor movement had been defanged. Today, unions and legal protections both continue to decline. The number of union members is going down, not up. The rise of an aggressive anti-union consultant industry and effective lobbying has succeeded in transforming the nation's labor laws and the political environment for organizing a union. While capital flight and mechanization hurt unions, the transformed legal landscape combined with aggressive new anti-union tactics make it easier for employers to defeat union elections. Today, only 10.7 percent of workers are unionized, down from 20.1 percent in 1983. Membership is also lopsided: public-sector workers are five times more likely to be unionized than those in the private sector—only 6.5 percent of private-sector workers are unionized, the lowest since 1932. The recent Supreme Court decision in Janus v. American Federation of State, County, and Municipal Employees, is expected to decimate labor's last (relative) stronghold in the public sector.Footnote ¹³ The decline of unionism, as opposed to the increased union statistics circa 1900, is another indication that these two periods are bookends rather than repetitions. Today the United States is moving away from restraints on the cruelty of capitalism, not toward them.

There is plenty of evidence that workers still want union protections. Furthermore, the decline of unionism does not mean that labor activism has died. To the contrary, there has been an explosion of creative labor organizing in recent years. The leadership provided in recent months by teachers on strike, from West Virginia to North Carolina to California, and the careful way they articulate their movement as benefitting their students and communities as well as themselves, provide just one important example. Nearly half a million workers were on strike in 2018—the highest number by far since 1986—and the vast majority of those strikers were teachers.Footnote ¹⁴ Furthermore, there is a great deal of activism taking place outside of the organized labor movement, with worker centers, fights for a living wage, and industry-specific organizations like the National Domestic Workers Alliance or the Restaurant Opportunities Centers United leading the way. Often these movements and organizations are led by women and immigrants. This new breed of activism relies on the best traditions of community organizing, mobilizing public opinion and engaging in protests and civil disobedience to make their voices heard. The tactics are paying off in higher minimum wage laws in cities and states across the country and in successful suits by workers’ centers against wage theft; and in Massachusetts, domestic workers won a “bill of rights” that includes overtime pay and regulations regarding fair treatment. Just as the labor movement in the late nineteenth century benefitted from the radical energies of German, Italian, and other immigrants, labor organizations today need to build space for the creativity of post-1965 migrants from Asia, Latin America, and other parts of the globe.Footnote ¹⁵

This resurgence of activism is encouraging for anyone who opposes giving capitalism free rein to dominate and exploit ordinary Americans. Yet to return to global considerations, there is something lacking in twenty-first century progressive activism: a fundamental critique of capitalism and a concerted effort to develop an alternative economic system. Socialism in America is not dead, as supporters of Bernie Sanders and Alexandria Ocasio-Cortez will tell you. The Democratic Socialists of America (DSA) recently announced that its membership quadrupled in the last twelve months—and that it got the biggest one-day membership spike in its history when Ocasio-Cortez won her primary. Those are figures that would make any anti-capitalist smile. But to put those achievements in context, note that DSA membership stands at a meager 60,000 people as of June 2019.Footnote ¹⁶ Furthermore, while it is extremely interesting to see the rise of political candidates who self-identify as socialist, a look at the policies they espouse demonstrates that they are in truth New Deal Democrats. Far from offering a fundamental challenge to the capitalist order, Ocasio-Cortez stands for expanded Medicare, full employment policies, protection of voting rights, improved regulation of campaign finance and the banking system, criminal justice reform, and passage of the Equal Rights Amendment.Footnote ¹⁷

The end of the Cold War and the collapse of the Soviet Union meant that the most potent alternative to capitalism, the one that gave sleepless nights to government officials and employers, no longer existed. Chinese communism has become a showcase for global capitalism, so its revolution likewise does not offer a credible alternative, except to those who like their capitalism more authoritarian. U.S. foreign policy continues to focus on suppressing—or stamping out—those last experiments in socialist society, such as Cuba and Bolivia, to kill the dream of an alternative to capitalism once and for all. Struggles over inequality in the twenty-first century United States thus have a global significance as well.

The narrative of a second Gilded Age erroneously suggests that the current dynamics are repeating those of the late nineteenth century. Although they share certain important characteristics, these are profoundly different historical moments. The late nineteenth century saw the ascent of serious efforts to rein in the power of the new capitalism and force it to bow down to the needs of civil society. During the late twentieth and early twenty-first centuries, we are experiencing the decline of that effort as capitalists and their ideological and political supporters push to see how far they can go to ensure the unchallenged hegemony of corporate and property rights. As noted at the beginning of this essay, the slow climb toward a more humane capitalism and the rapid descent away from it constitute two very different experiences. The current historical moment so far lacks the fundamental ideological critique of the economic and social system today—and a social movement fueled by that critique—capable of leading American to a new era in which capitalism would again be powerfully restrained and the rights of workers and other groups would expand. Seeing the current era as a repetition of the late nineteenth-century Gilded Age can lead to optimism that a new Progressive Era is waiting right around the corner, but why should we assume that the current slide away from humane capitalism will be followed by such a reversal? If a new Progressive Era exists in our future, it will be built on different inspirations and impulses from those that existed a century ago. It will require new kinds of creative tactics, and it will likely find leadership among new and unexpected women and men.