From: lessgovt@gmail.com   
      
   The ‘Gilded Age’ Myth, Then and Now   
   By Phil Gramm and Amity Shlaes, May 7, 2023, WSJ   
   Everything old is new again, and blaming the rich for America’s woes is no   
   exception. The rise of progressivism before the turn of the 20th century was   
   fueled by the perception that “robber barons” of industry and finance had   
   earned their fortunes    
   from their monopoly power that allowed them to exploit the poor and middle   
   class. That era has been damned with a pejorative label: the Gilded Age.   
      
   That thinking has re-emerged in the Democratic Party today, though this time   
   it has its sights set on our economy’s tech giants. In both cases, the   
   underlying economic claims are at variance with the facts. The wealth created   
   by industrialization,    
   modern finance and communication has reduced poverty, elevated material   
   well-being and promoted general prosperity. Economic growth isn’t a zero-sum   
   game.   
      
   That hasn’t stopped popular culture, economists and public education from   
   claiming otherwise. In Washington’s National Portrait Gallery, in a room   
   filled with paintings of the great titans of industry and finance, there is a   
   depiction of the economic    
   journalist Henry George with an accompanying plaque quoting his assessment of   
   the Gilded Age: As the U.S. advances in material and technical progress, he   
   observed, “the rich get richer, the poor grow helpless, the middle class is   
   swept away.”   
      
   More than a century later French economist Thomas Piketty concluded that the   
   middle class “suffered a setback during the Gilded Age.” Likewise, in the   
   teacher’s guide to his bestselling American history textbook, Howard Zinn   
   writes that “ordinary    
   people who lived through the Gilded Age . . . experienced tremendous hardships   
   and losses. . . . While they got poorer, the rich were getting richer.”   
   Remarkably, these statements were written about a period that by every   
   available economic measure was    
   the beginning of a golden age of material well-being—especially for American   
   workers.   
      
   Between 1870-1900, America’s inflation-adjusted gross national product   
   expanded by an unprecedented 233%. Though the population nearly doubled, real   
   per capita GNP surged by 90%. Real wages of nonfarm employees grew by 53%, and   
   life’s staples, such    
   as food, clothing and shelter, became more plentiful and much cheaper. Food   
   prices plummeted by 63% and the cost of textiles, fuel and home furnishings   
   fell by 70%, 65% and 70%, respectively. The illiteracy rate fell by 46% and   
   life expectancy rose 12.5%.   
    Infant mortality declined by 17%.   
      
   As American capitalism blossomed, some got rich. In 1892 there were 4,050   
   millionaires, with less than 20% having inherited their wealth. The rest   
   created it and in the process reduced poverty, expanded general societal   
   prosperity, and made it possible    
   for millions of immigrants looking for opportunity and freedom to find both.   
   That mattered little to progressives, who were so obsessed by the 4,050   
   millionaires that they turned a blind eye to the 66 million Americans whose   
   economic well-being improved    
   faster than any people who had ever lived on earth.   
      
   Had the Gilded Age suffered from monopolistic exploitation, as critics claim,   
   output would have fallen and prices would have risen in the monopolized   
   industries. In a 1985 study, economist Thomas DiLorenzo tested that hypothesis   
   for steel, petroleum,    
   railroads and other industries accused of being monopolistic during the debate   
   on the Sherman Antitrust Act of 1890. He found that output in those industries   
   actually increased by an average of 175% from 1880-90—seven times the growth   
   rate of real GNP.    
   On average, prices in the ostensibly monopolized industries fell three times   
   as fast as the consumer price index.   
      
   This myth of the Gilded Age in turn produced Progressive Era regulations that   
   proved to be an impediment to competition, as regulation became an   
   “instrument of cartelization,” producing higher prices, poorer services   
   and less innovation. By the 1970s    
   the negative effect of these regulations was so obvious that Sen. Ted Kennedy   
   and President Jimmy Carter led the deregulation of airlines, trucking,   
   railroads, energy and communications. The benefits of overturning Progressive   
   Era regulations included    
   more competition, greater efficiency, more innovation and stronger growth,   
   setting the foundations of contemporary American competitiveness and   
   prosperity.   
      
   Proving that no bad idea ever dies, progressivism has been reborn with   
   outcries against billionaires and the tech industry as the new monopolistic   
   “trust” that must be “busted” and regulated. Robert Reich, who served   
   as President Clinton’s    
   labor secretary, has opined that “like the robber barons of the first Gilded   
   Age, those of the second”—the tech giants—“have amassed fortunes   
   because of their monopolies.”   
      
   Yet on both claims, with growing inequality and monopoly as its cause, the   
   case for 21st-century progressivism is even weaker than it was in the Gilded   
   Age. Spewing envy at the Fortune 400 billionaires—whose combined after-tax   
   incomes wouldn’t have    
   funded federal, state and local government in 2020 for a week—progressives   
   denounce such people as Bill Gates, who has created hundreds of thousands of   
   jobs and enriched the lives of billions. Today our retirement funds own far   
   more of Microsoft than    
   he does.   
      
   Tech production and prices show no signs of the modern tech industry being   
   monopolized. In fact many of their products are free, and the cost of search   
   and text advertising that underwrites much of their revenues has fallen by   
   more than 50% in the last    
   decade. Progressive regulation for 80 years stifled competition, lowered   
   efficiency and drove up prices. Is this an experiment we want to repeat?   
      
   Today’s progressive rant that income inequality is an existential threat is   
   unpersuasive and untrue. If we counted all transfer payments such as food   
   stamps and refundable tax credits as income to their recipients and taxes paid   
   as income lost to    
   taxpayers—something the U.S. Census Bureau doesn’t do—we’d find that   
   income inequality is lower today than it was in 1947.   
      
   At its root, progressivism is based on a myth and fueled by envy—the same   
   caustic force that has destroyed prosperity and endangered freedom from the   
   time of the ancient Greeks.   
      
      
   [continued in next message]   
      
   --- SoupGate-Win32 v1.05   
    * Origin: you cannot sedate... all the things you hate (1:229/2)