Why Next to No Political Reaction to the Second Gilded Age?

Mark Thoma comments on Why Next to No Political Reaction to the Second Gilded Age?, by Brad DeLong.

DeLong asks:

But the political economy of Gilded Ages? Why the first Gilded age produces a Populist and a Progressive reaction and the second, so far, does not? There I throw up my hands and say that my economic historian training betrays me. I have no clue as to what is going on here.

Thoma's response is:

I think it matters a lot whether we think of inequality as arising from a problem in the system as a whole, or as the result of individual failures. When people think it's the system as a whole — the rich and powerful are scheming to hold everyone else down (e.g. robber barons) — mass movements are more likely than when it is viewed as simply the failings of individuals.

I think both DeLong and Thoma miss several important points:

• The populist movements of the early 20th Century arose as a reaction to several trends:
• The great depression of the 1890's
• The rapid industrialisation of the USA from 1890 to 1930 as agriculture gave way to industry as the main employer
• Rise of Socialist thought (among which was Marxism and the various strands of Anarchism)
• The rapid growth and radicalisation of the union movement in response to these trends
• In the past 30 years, the union movement has been defeated again and again. The main defensive weapon of the workers is now in a much weaker state now than a century ago.
• In the 1930's, there was a serious alternative to the Capitalist system in the form of the USSR. Ideologically and economically, Communism was seen as superior to Capitalism especially during the Great Depression.
• The fall of the USSR has removed that alternative from the public consciousness.
• There have been several significant mass movements over the past 15 years:
• The Anti-Globalisation movements starting in Seattle in 1999.
• The Anti-War movements of 2003. (See 15 February 2003)
• The various Occupy movements starting in 2011.
• The Arab Spring starting in 2012

I think the populist movements alluded to be DeLong and Thoma were the last real chance of the Capitalist system to bribe the workers away from Communism. The advent of neo-liberalism has destroyed that project once and for all.

There is a political reaction to the second Gilded Age, but it is muted as the traditional expressions of popular will have been emasculated.