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gilded age
Trump, Extreme Wealth Concentration, and Our Societal Crisis
The US government simply has not done enough to ensure that the livelihoods of all Americans are protected or improved in this new Gilded Age. What it has done is made sure the rich get richer by the minute and more politically powerful year after year.
Feb 09, 2026
The decline of Keynesian economic theory in the 1970s marked a tipping point in the evolution of capitalism in the United States. Beginning with the Great Depression, Keynesian economic policy facilitated the expansion of social welfare programs to mitigate the social inequities of the nation's economic system. In the last quarter of the 20th century, however, rising political conservatism targeted public expenditures for social services. Cuts in education and health, including reductions in social welfare programs and the weakening of the social safety network for the poor, were then and continue today to be goals of political conservatives. Conservatives, furthermore, argue that cutting taxes for the wealthy and corporations promotes investment, economic growth and job creation; and that smaller government and less regulation of market forces distributes wealth the most equitably. These ideas are variously known as supply-side economics, neoliberal economics or simply “trickle-down theory.” Historically, though, trickle-down theory has failed to benefit American working families. In fact, during the course of the last several decades this market strategy has encouraged vast accumulation of private wealth and accelerated its concentration on both a national and global scale. Tragically, it has had deeply injurious social consequences. The societal crisis America finds itself in today relates directly to extreme concentration of wealth.
Absent effective public regulation of economic activities, government and law protect investors and corporations in their aggressive pursuit of wealth. The distribution of wealth in the U.S. is a primary indicator of who benefits most from the political and legal organization of American society. In the third quarter of 2025, according to Federal Reserve data, the top 1% of Americans held 31.7% of all wealth while the bottom 50% held 2.5% (Federal Reserve 2025). That is the highest concentration of wealth in the post-WWII era (Economic Inequality), greater than almost any other developed country. Another indicator of the government's weak support for workers and their families is the federal minimum wage. It is $7.25/hour. At forty hours per week this represents a monthly income of $1160 and a yearly income of $13,920. In 2025, the federal poverty level for individuals was $15,650 and $32,150 for families of four (Poverty Level). These dismal figures show how dire wages are for many millions of Americans. In real terms (inflation-adjusted) the average wage of American workers peaked 48 years ago in 1978 (Wages Peaked).
If one takes a closer look at wealth concentration and the average American’s opportunity to accrue wealth since the 1970s and 1980s, it offers more evidence of how the last few decades of capitalism's development have denied workers a fair share of the tremendous wealth that has been generated. Indeed, a 2023 Rand Corporation analysis revealed that, since 1975, $79 trillion in wealth had been transferred from the bottom 90% to the top 1%. (Massive Wealth Transfer ). This massive redistribution of wealth continues today. In 2023 alone, $3.9 trillion in wealth was siphoned from working Americans to the richest Americans, enough to give every full-time worker in the bottom 90% a $32,000 raise for the year (2023 Wealth Transfer). When it comes to gaining wealth for the average working American, owning a home is the principal path. Home ownership, however, is completely out of reach for the poor and millions more in today's middle class find it unattainable. The median home price to annual income ratio was 5 in 2025. In other words, the median price of a home was equal to 5 years of salary. The ratio was 3.7 in 1985 when a median-price home was $82,800. Today a median-price home is $416,900. Not only is the distribution of wealth radically unequal, the pathway to increased wealth in home ownership has narrowed dramatically.
The political division and violence in America today stems in large measure from a political system whose policies have encouraged radical disparities in incomes and wealth.
These data amply illustrate the crisis poor and increasingly middle income people in the United States face. The poorest Americans, the bottom 20%, simply do not have enough money to meet their daily needs. Nearly a third of all households lives on less than $50,000 annual income (Household Income). In the richest country in the world 36.8 million Americans live in poverty (Poverty), including 9 million children without adequate access to food, shelter and healthcare (Children). At the same time, the more than 900 billionaires in the U.S. have a collective wealth of $6.9 trillion, their wealth increasing 18% in 2025 alone (Fortune). As reported in Forbes, Elon Musk, the richest man in the world, now has wealth of $778 billion (Elon Musk). It would take the average American worker 16 million years to make that much (Extrapolated).
The US government simply has not done enough to ensure that the livelihoods of all Americans are protected in this new Gilded Age. In fact, the government actually provides 40% more benefits to the wealthy than to the impoverished. In his 2023 book Poverty, By America, Pulitzer Prize-winning author Matthew Desmond draws attention to this fact. From recent government data “compiling spending on social insurance, means-tested programs, tax benefits, and financial aid for higher education,” Desmond calculates that the top 20% of income earners on average receives $35,363 in government benefits and individuals in the bottom 20% receive an average $25,733 (p. 99). This reality is a result of policies, policies that benefit wealthy Americans and corporations at the expense of working people. Public policy, in turn, is shaped by corporate lobbying and political contributions as well as professional research that supports goals of the wealthiest and most influential: smaller government, broad corporate deregulation, limited worker protections, and tax breaks favoring the wealthy over working Americans.
It has not always been this way. Between 1947 and 1979, the period when Keynesian economic theory and policies prevailed, “hourly wages grew 2.2 percent. From 1979 to the present, average growth in hourly wages fell to 0.7 percent per year, only one-third of the average rate in the earlier postwar period” (Economic Policy Institute). In the first three decades after WWII labor unions tripled weekly earnings of manufacturing workers across the nation. Collective bargaining gained “for union workers an unprecedented measure of security against old age, illness and unemployment, and, through contractual protections, greatly strengthening their right to fair treatment at the workplace” (Labor Unions). Significantly, one-third of workers (32.3% in 1959) were unionized in this post-war period (Bureau of Labor Statistics ). By 2024, the percentage of wage and salary workers in unions fell to 9.9 percent (Bureau of Labor Statistics). Concentrated wealth, particularly corporate wealth, and government failure to protect workers dampened wages. Also, in the 1950s the statutory taxes on U.S.corporate and personal wealth were much higher, though the effective tax rate was considerably lower due to corporate tax loopholes and rich taxpayers recategorizing income as derived from investments (Tax Rates). The statutory corporate income tax was over 50 percent (Economic Policy Institute). Today it is 21 percent (Corporate Tax). While it is difficult to determine the percentage of taxes actually paid by wealthy individuals and corporations in the early post-war era, it is clear that the statutory personal and corporate income tax is lower today than it was 70 years ago. Of course, enforcement of steeply progressive taxation would make billions of dollars, even trillions, available to fund social programs that distribute income and wealth more fairly.
The pro-democracy citizenry must organize around a political vision that emphasizes several political projects: a just, progressive taxation system; a guaranteed household income; universal healthcare; quality public education; free preschool education; and scientific and technological initiatives for a sustainable economy.
A society riven by such income and wealth inequality is inherently unstable. The political division and violence in America today stems in large measure from a political system whose policies have encouraged radical disparities in incomes and wealth. The loss of 6.5 million manufacturing jobs since 1979 (1979 and 2025), for example, has been facilitated by trade agreements that enable corporations to chase the cheapest wages throughout the world. Runaway companies have gutted industrial towns without consequence, leaving behind poorer communities of people with limited resources to rebuild their lives and neighborhoods. The federal government, moreover, has done virtually nothing to force corporations to pay reparations for the social disintegration left in their wake. As the coastal regions and large metropolitan centers of the nation were generally integrated into the surging commerce of unbridled globalization, distant rural regions experienced economic stagnation and decline. It is little wonder that an authoritarian political figure that exploits these divisions has risen to the presidency of the United States.
In his seminal book Capital in the Twenty-First Century, French economist Thomas Piketty provides an analysis of capitalism in which he notes that “the history of the distribution of wealth has always been deeply political” (p. 20). Reduction of taxes that favors the wealthy is one political determination reflecting the unstemmed power of concentrated wealth. While this political maneuver undermines a primary income and wealth distributive mechanism (taxation system), it further restricts the resources for funding other re-distributive projects such as social welfare, public education and healthcare. Smaller government and privatization of public services are corollary results.
A principal dynamic factor in the process of wealth accumulation and concentration over the last several decades is the growth of profits as the economic growth rate has slowed down. Put another way, the wealthy are taking a larger and larger slice of diminishing income and wealth production. As the vast inequalities in the distribution of income and wealth deny the provision of basic living necessities to tens of millions and circumscribe opportunity for most Americans, social instability and political division and violence escalate. In response, an authoritarian regime consolidates its power around armed force to repress those protesting its anti-democratic policies. Its armed repression inevitably leads to bloodshed.
The pro-democracy citizenry must organize around a political vision that emphasizes several political projects: a just, progressive taxation system; a guaranteed household income; universal healthcare; quality public education; free preschool education; and scientific and technological initiatives for a sustainable economy. These political goals stand in stark contrast to an authoritarian regime that advances the interests of the one percent. They offer a view of the future that is constructive and inspirational, one that generates broad social justice and appeals to the vast majority of Americans.
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Trump's Billionaire Ballroom Is a Perfect Symbol of the Second Gilded Age
The new robber barons are having their names etched into the pediments of the giant new ostentatious ballroom President Donald Trump is adding to the White House.
Oct 23, 2025
In the first Gilded Age, which ran from the 1890s through the 1920s, captains of American industry were dubbed “robber barons” for using their baronial wealth to bribe lawmakers, monopolize industry, and rob average Americans of the productivity of their labors.
Now, in a second Gilded Age, a new generation of robber barons is using their wealth to do the same—and to entrench their power.
The first Gilded Age was an era of conspicuous consumption. The second is an era of conspicuous influence.
The new robber barons are having their names etched into the pediments of the giant new ostentatious ballroom President Donald Trump is adding to the White House.
Trump is now literally taking a wrecking ball to the White House—sending parts of the East Wing’s roof, the building’s exterior, and portions of its interior crumbling to the ground.
They already own—and influence—much of the news Americans receive. And they are eager to promote their views.
Marc Benioff, the billionaire founder and CEO of Salesforce, told the New York Times that Trump should send the National Guard to San Francisco. (After his remarks drew condemnation from many of the city’s civic leaders, he apologized. He seems about to get his wish nonetheless.)
Marc Rowan, the billionaire chief executive of Apollo Global Management, is the force behind Trump’s recent “compact” calling on universities to limit international students, protect conservative speech, require standardized testing for admissions, and adopt policies recognizing “that academic freedom is not absolute,” among other conditions. The Trump regime dangled “substantial and meaningful federal grants” for universities that agree.
(It didn’t work. Seven of the nine universities approached rejected the deal.)
Billionaire Stephen A. Schwarzman, the chief executive of Blackstone, is also shaping the Trump regime’s campaign to upend American higher education. Schwarzman has emerged as a key intermediary between Trump and Harvard University.
Other of America’s new robber barons are rapidly consolidating their control over what Americans read, hear, and learn about what’s occurring in our country and the world. They include Jeff Bezos; Larry Ellison and his son, David; Mark Andreessen; Rupert Murdoch; Charles Koch; Tim Cook; Mark Zuckerberg; and, of course, Elon Musk.
Perhaps the new robber baron’s most lasting impression on the US government will be the lavish White House ballroom Trump is constructing—a 90,000-square-foot, gold-leafed, glass-walled banquet room that will literally overshadow the so-called People’s House.
It will not be an assembly hall, dance hall, music hall, dining hall, village hall, or town hall. It will be a giant banquet and ballroom designed to accommodate 650 wealthy VIPs.
Trump claims that the East Room, the largest room in the White House, is too small. Its capacity is 200 people. He doesn’t like the idea of hosting kings, queens, and prime ministers in pavilions on the South Lawn.
Trump’s real intention is to have the White House resemble Versailles.
Potential billionaire donors have already received pledge agreements for “The Donald J. Trump Ballroom at the White House.” In return for donations, contributors are eligible for “recognition associated with the White House Ballroom.”
Their names will be etched in the ballroom’s brick or stone edifice.
Trump last week hosted a dinner at the White House for the project’s donors, which included representatives from Microsoft, Google, Palantir, and other companies, as well as Schwarzman, Cameron and Tyler Winklevoss, and other billionaires.
Meredith O’Rourke, a top political fundraiser for Trump, is leading the effort, paired with the Trust for the National Mall, an organization that supports the National Park Service.
The trust’s nonprofit status means donations come with a federal tax write-off.
Construction began Monday. Trump is now literally taking a wrecking ball to the White House—sending parts of the East Wing’s roof, the building’s exterior, and portions of its interior crumbling to the ground.
It seems fitting that in this second Gilded Age—an age of conspicuous influence and affluent access—the People’s House will be replaced by the Billionaire’s House.
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Trump Is Making the Gilded Age Great Again
Trump’s duties on foreign imports will undercut the fiscal foundations of a middle-class American society that we’ve known for more than a century, creating a new age of rising private fortunes and deepening inequality.
Jul 29, 2025
Count on one thing: If Mark Twain, the famed American author of Tom Sawyer and Huckleberry Finn, were alive today, he would certainly have written a novel about U.S. President Donald Trump. After all, his 1873 novel, The Gilded Age: A Tale of Today, distinctly caught a 19th-century version of our Trumpian moment, tariffs and all.
“They want me to go in with them on the sly,” says Colonel Sellers, the antihero of that novel. Lowering his voice to a conspiratorial whisper, the colonel explains to his wide-eyed dinner guest how they would “buy a 113 wild cat banks in Ohio, Indiana, Kentucky, Illinois, and Missouri… and then all of sudden… Whiz! the stock of every one of those wildcats would spin… profit on the speculation not a dollar less than 40 millions!”
With Twain’s uncanny insight into the American character, his novel presaged the quarter-century to follow so accurately that, in the end, it lent its name to “the Gilded Age,” that era of rapid industrialization and rising robber-baron fortunes. Ripped from two centuries of Puritan moral moorings by an “inflamed desire for sudden wealth,” the novel’s archetypal American families are caught in a “fever of speculation” that sends them scrambling across the continent in a frenzied search for jackpot profits.
With money then breeding its own morality, the era’s capitalist excess naturally begat Trumpian-style corruption. When unpaid wages stopped the construction of his railroad out West, Twain’s character Colonel Sellers sent the project’s chief engineer to the head office in New York City to find out what had happened to the missing money.
If we combine the social impact of his recent “Big Beautiful” budget bill, which extends the 2017 tax cuts, with his skyrocketing tariffs, Trump seems to be trying to undo the landmark tax legislation of 1913 by reducing or replacing the progressive income tax with tariff revenues that are really a regressive tax on the poor.
“The matter is simple enough,” the company’s president explained matter-of-factly to the astonished engineer. “A Congressional appropriation costs money. A majority of the House Committee, say $10,000 apiece—$40,000; a majority of the Senate Committee, the same each—say $40,000; a little extra to one or two chairmen of two such committees, say $10,000 each—$20,000; and there’s $100,000 of the money gone.”
Beneath the spectacle of soaring stock prices, spreading railroad networks, smoking steel mills, powerful trust monopolies, and conspicuous consumption by the country’s ever-increasing number of millionaires, Twain discerned a deep underlying insecurity to be the very essence of what became known as the Gilded Age. “It is a time,” he wrote, “when one’s spirit is subdued and sad, one knows not why; when the past seems a storm-swept desolation, life a vanity and a burden, and the future but a way to death.”
Looking at contemporary America through Twain’s somber vision can teach us something significant about our own time that has so far eluded the mainstream media—particularly the profound political implications of President Trump’s wild global tariff regime. Those duties on foreign imports will not just raise prices and stoke inflation, as the media has indeed been telling us, but all too crucially undercut the fiscal foundations of a middle-class American society that we’ve known for more than a century, creating a new Gilded Age of rising private fortunes—in our time, billionaires—and deepening social inequality.
And with Donald Trump in mind, let’s take a little trip through a history that’s anything but Tom Sawyeresque.
Cycles of Change
Give Twain full credit: When writing that novel, he also intuited that the economic juggernaut driving his Gilded Age would come crashing down in what proved to be the devastating panic of 1893. The country had indeed suffered 11 previous panics, most of them regional or relatively short-lived. This one would be different. As New York banks held fire sales of assets to meet a cash crunch, some 340 banks nationwide simply suspended operations, while industrial output shrank by 15%, and unemployment hit an unprecedented 19%. Adding to the difficulties of workers, the McKinley Tariff of 1890, named after then-representative (and not yet president) William McKinley, had imposed record-high duties of 50% on imports and so raised the price of many basic consumer goods, which should sound all too familiar in the age of Trump. The panic then became a full-blown, four-year depression that sent thousands of the unemployed, then called Coxey’s Army, marching on Washington to demand redress from Congress.
Not only was that panic an economic crisis of unprecedented severity, but it was also the first in a boom-and-bust cycle that has marked America’s unbridled capitalism up to the present moment—with each boom producing spectacular private wealth and each bust fostering abject public misery and mass reform movements. Like Icarus of Greek legend, whose wings of wax carried him too close to the sun, the U.S. economy sometimes flies so high that its wax wings melt. The ensuing crash is so searing, immiserating so many for so long, that it can inspire sustained movements for change.
The severity of the protracted 1893 depression that ended the Gilded Age sparked myriad calls for social change and lead to the Progressive Era during which labor unions organized workers, the National Association for the Advancement of Colored People started its struggle for civil rights, and women marched for suffrage. Investigative reporters called “muckrakers” also began publishing exposés of financial power and political corruption in mass-circulation magazines like McClure’s and Collier’s Weekly, thereby setting an agenda for political reform. In major cities, middle-class reformers opened settlement houses for poor immigrants, enacted housing codes to ban cold-water tenements, and set up free public schools. At the state level, progressives like Wisconsin Gov. Robert La Follette battled the railroad monopolies that gouged farmers desperate to get their crops to market.
Meanwhile, at the national level in 1913, Democratic reformers in Congress slashed the country’s high tariffs (long a regressive tax on working-class consumers), replacing them with a progressive income tax whose top rate was then 7% on incomes over $500,000. Since the federal government had long used tariffs as its prime source of revenue, Progressive era legislators fully grasped just how fundamentally regressive they were, and fought successfully to cut the tariff rate from President McKinley’s 29% in 1899 to just 6% by 1917. Typically, the import duties that refiners in Brooklyn and Philadelphia paid on raw Cuban sugar would be passed on to consumers as higher prices. And clearly, the cost of a cup of sugar then took a far more significant slice out of a worker’s wages than it did from the kitchen budget of a millionaire’s chef. Requiring those who had the least to pay the most was a glaring economic injustice that would inspire progressive reformers to fight tariffs with an impassioned intensity that seems almost incomprehensible today.
The Roaring ’20s
But all that momentum for change stalled when, in 1917, the United States entered World War I and then segued to a postwar decade of speculative frenzy. At war’s end in 1918, Forbes magazine published its first ranking of the country’s richest men, with oil baron John D. Rockefeller then America’s first and only billionaire, followed by 29 millionaires (whose fortunes, corrected for inflation, would make them billionaires today)—industrial tycoons like Andrew Carnegie (steel), J. Ogden Armour (meat packing), Henry Ford (autos), Daniel Guggenheim (mining), and Pierre Du Pont II (chemicals).
After the stock market started roaring in the 1920s, however, it minted hundreds of new millionaires, while sales of cars, telephones, radios, and appliances boomed. Between 1921 and 1929, the Dow Jones Industrial Average for shares on the New York Stock Exchange surged by 600%.
As a parallel tide of political repression swept the country, American Legion veterans broke up socialist rallies, a young J. Edgar Hoover rounded up radicals for deportation, and bloody race riots swept Chicago and Washington, D.C. While Republican conservatives took control of Congress and the White House, a revived Ku Klux Klan ran the legislatures of a half-dozen states, lobbied Congress to enact immigration restrictions, and presided over some 400 lynchings of African-Americans.
The Depression Decade of the 1930s
The stock market that came in like a roaring lion at the start of the 1920s went out like a bleating lamb at decade’s end. On Black Monday, October 28, 1929, it suddenly dropped 13%, lost another 12% on Black Tuesday, and kept sliding into the summer of 1932, losing 90% of its value in a fall so steep it wouldn’t reach that peak again until 1954.
By the time President Franklin Delano Roosevelt, or FDR, was inaugurated in 1933, the nation was in dire straits. About 25% of the workforce, or some 13 million people, were unemployed—with thousands of “hobos” riding the rails, long lines snaking outside soup kitchens, and shanty towns (dubbed “Hoovervilles” after the indifferent president who had preceded FDR) huddled outside cities large and small. In the industrial northeast, factories shut down. In the Great Plains, thousands abandoned their farms in the country’s “dust bowl” and headed for California.
By the time the New Deal was done in 1945, the Roosevelt administration had brought high-flying U.S. capitalism down to Earth, with regulations that curbed speculative excess, while preventing spectacular crashes.
So deep and desperate was the Great Depression that President Roosevelt had ample public support to enact a “New Deal” of unprecedented socioeconomic reforms, creating nothing less than the modern federal government. To provide work for the unemployed, FDR formed the Civilian Conservation Corps and the Works Progress Administration that mobilized nearly 9 million people to build 8,000 parks, 75,000 bridges, and 650,000 miles of roads. Private sector workers won the right to form unions and strike under the National Labor Relations Board, largely ending the union-busting and goon violence of decades past. Since the country had no form of retirement savings, FDR formed the Social Security Administration in 1935 (which currently sends benefits to 66 million Americans).
To fully electrify the economy, the New Deal dotted the U.S. with massive hydroelectric projects like the Fort Peck Dam and delivered cheap power to farms through the Rural Electrification Administration. To make air travel affordable, the Roosevelt administration built 800 airports nationwide, notably LaGuardia Airport in New York City.
To end the bank runs that periodically wiped out customers’ deposits, his Banking Act of 1933 created the Federal Deposit Insurance Corporation to enforce restrictions on banking speculation, and a year later formed the Securities and Exchange Commission to protect ordinary investors from fraud.
As the New Deal raised the tax rate for the top income bracket from 79% to a historic high of 94% by 1945, the share of all U.S. income earned by the richest 1% fell from a peak of 24% in 1928 to just 10% after World War II and would remain there until 1980. That change would be foundational for the middle-class democracy that many still regard as archetypally American.
In sum, by the time the New Deal was done in 1945, the Roosevelt administration had brought high-flying U.S. capitalism down to Earth, with regulations that curbed speculative excess, while preventing spectacular crashes.
A New Gilded Age
As the Cold War drew to a close during the 1980s, President Ronald Reagan advanced a conservative agenda of tax cuts and deregulation, sparking the start of a new Gilded Age that, over the next 30-plus years, would produce a level of economic inequality not seen for nearly a century. That era also coincided with a succession of financial crises that could have sparked serious economic depressions had they not been constrained by the regulatory mechanisms the New Deal had put in place.
By slashing the tax rate on the highest incomes from 70% to just 28%, President Reagan catalyzed a steady climb in private wealth that would continue unchecked for decades to come. By 2007, the richest 1% were already earning 24% of the nation’s income, putting them right back where they had been in the 1920s.
Just as railroads were the iconic industry of the original Gilded Age, so the Internet and its corporate spin-offs became the prime driver of our current era of excess. The release of software developer programs like Mosaic combined with a sharp increase in U.S. households with a personal computer—from just 15% in 1990 to 35% by 1997—became the prime ingredients for the “dot-com bubble” of the late 1990s. Growing numbers of Americans started shopping at Amazon.com, searching on Google, and booking travel online at Expedia.
As the Telecommunications Act of 1996 opened up the broadcast spectrum and the Taxpayer Relief Act of 1997 cut capital gains taxes on stock transactions, the Nasdaq stock exchange, which features tech listings, rose by 400% in a five-year frenzy of speculative trading for almost any stock with “.com” in its name. Adding fuel to that blazing fire, in 1999 the White House of President Bill Clinton encouraged Congress to repeal the New Deal’s Banking Act of 1933, allowing financial speculation through the merger of retail and investment banking.
In March 2000, the dot-com bubble finally burst, and the Nasdaq stock index started a sustained fall that virtually wiped out the previous decade’s gains. Over the next two years, markets were also shaken by serious scandals after company officers falsified returns to feed the market frenzy, bankrupting a half-dozen major corporations, including WorldCom, the country’s second-largest telephone company; Enron, a top energy corporation with revenues of $100 billion; and Adelphia, a prominent cable television provider with over two million subscribers. To correct what one leading law firm called “a broader culture of greed and deception that had taken root in the corporate world,” Congress passed the Sarbanes-Oxley Act in 2002 that tightened financial regulations to protect investors from systemic fraud.
Nonetheless, an even greater panic soon followed. Freed from the New Deal Banking Act’s restraint on speculation, investment banks began engaging in predatory lending of subprime mortgages and aggressive marketing of mortgage-backed securities, producing a profit-taking craze that came crashing down in the Great Recession of 2007-2009. As the country’s fourth-largest investment bank, Lehman Brothers, collapsed and its fifth-largest, Bear Sterns, was liquidated in a “fire sale,” the financial system trembled at the brink of collapse. Recognizing the seriousness of the crisis, Congress quickly authorized corporate bailouts funded by a $700 billion appropriation under the Troubled Asset Relief Program. By the time the Great Recession ended in mid-2009, unemployment had doubled to 10% and the Dow Jones Average had fallen by 50%. But the country had indeed been spared another Great Depression.
The Advent of Donald Trump
During those 30 years of boom and bust, however, one trend remained remarkably steady: The rich just kept getting richer. The number of global billionaires listed by Forbes magazine would increase tenfold from 291 in 1992 to 2,781 in 2024, with a total wealth of $14.2 trillion. During the 2016 presidential campaign, Forbes included Donald Trump among them, estimating his wealth at $4.5 billion.
In past periods of conservative Republican rule, Congress and the White House served the interests of the richest 1%, whether industrialists or Internet tycoons. But in 2016, for the very first time, the American people put a genuine billionaire in the White House and, to nobody’s surprise, he soon made it clear that his only consistent concern was serving the interests of his peers.
In the first year of his first term, in fact, Trump enacted the 2017 tax cuts that The New York Times called “the most sweeping tax overhaul in decades.” By cutting the corporate tax rate from 39% to 21%, reducing the top individual income tax rate from 39.6% to 37%, and doubling the size of estates exempt from being taxed to $11.2 million, those Trump tax cuts, economists found, produced a marked increase in “after-tax income for high-income households.” Indeed, the bottom 20% of wage earners saved just $60 each, while the upper 1% gained $51,000 each and the top 0.1% at least $193,000.
Without such mass protests and a determined democratic opposition at the ballot box, the Trump administration will persist with a tax and tariff policy aimed at creating the sorts of social inequity and economic privilege not seen since Mark Twain’s original Gilded Age.
Yet even that landmark legislation would pale before the inequitable impact of Trump’s tax policies in his second term in office, which all too literally sought to overturn the fiscal foundations of the Progressive Era reforms that had shaped American middle-class society for more than a century. If we combine the social impact of his recent “Big Beautiful” budget bill, which extends the 2017 tax cuts, with his skyrocketing tariffs, Trump seems to be trying to undo the landmark tax legislation of 1913 by reducing or replacing the progressive income tax with tariff revenues that are really a regressive tax on the poor. When the budget’s tax cuts for the rich are combined with his escalating tariffs that are bound to raise prices for ordinary consumers, those twinned policies are guaranteed to produce a massive transfer of wealth to the wealthiest 1% of Americans, creating an ever steeper version of social inequality that is fast fostering a new Gilded Age (and the economic disasters that are bound to go with it).
Apart from his trade war with China, in his first term Trump actually had little impact on tariffs. By the time he left office in 2021, he had raised the average import duty only incrementally from 1.4% to 2.8%—a far cry from the record 50% rate of the 1890 McKinley Tariff, and so still an insignificant factor in both Federal revenues and the average American’s cost of living.
In his inaugural address last January, however, Trump praised his distant predecessor, saying, “President McKinley made our country very rich through tariffs and through talent—he was a natural businessman—and gave Teddy Roosevelt the money for many of the great things he did, including the Panama Canal.” In a Rose Garden ceremony on his April 2 “Liberation Day,” President Trump ordered record-high tariffs for all the world’s nations, with duties of 50% on imports from Lesotho and 84% on those from China. Then, in an interview with Fox News on April 15, the president suggested, “There is a chance that the money from tariffs could be so great that it would replace” the income tax. As the average import duty started climbing to 15%, his trade adviser Peter Navarro projected that Trump’s tariffs could raise $600 billion in revenues, or more than a third of the $1.6 trillion in individual income taxes the Internal Revenue Service collected in 2024.
During the four-month blitz of tariff orders that followed, the Trump White House has insisted on the fiction that other countries will simply pay those import duties. After proclaiming himself a “Tariff man,” during the 2024 election campaign Trump told his rallies that “a tariff is a tax on a foreign country… A lot of people like to say it’s a tax on us. No, no, no, it’s a tax on a foreign country.”
In May, when Walmart’s CEO exposed the transparent falsity of that statement by stating, “Higher tariffs will result in higher prices,” an apoplectic president told the company to “EAT THE TARIFFS.” In mid-July, when Trump announced another round of tariffs that were to reach a McKinleyesque level of 50%, a White House spokesman repeated that exculpatory falsehood, saying: “The Administration has consistently maintained that the cost of tariffs will be borne by foreign exporters who rely on access to the American economy.”
Rising Resistance
With surprising speed, Americans are starting to see through such sophistry and resistance to the Trump administration is rising. Despite his repeated denials, a Gallup poll taken in April found that 89% of all Americans believe that “higher tariffs will result in… paying more for products.” And in late June, as Trump’s “Big Beautiful” budget bill neared legislative approval with massive cuts to health care for millions of Americans, a Quinnipiac University poll found 55% of the country opposed the bill and only 29% supported it.
Those polls reflected a growing opposition to Trump’s policies. In April, his then-ally Elon Musk poured a record-breaking $25 million into the election for the Wisconsin state Supreme Court, but the opposing Democratic candidate still won a stunning double-digit victory. In June, five million Americans in 2,200 cities and towns across the country marched in anti-Trump “No Kings” rallies, which added up to the largest single day of mass demonstrations in U.S. history.
After only six months of Trump’s term, it is still not clear whether his erratic economic policies—disrupting supply chains, creating labor shortages from mass deportations, and inducing record inflation—will inflict sufficient social pain to inspire a sustained movement for change. But one thing is already quite clear: Without such mass protests and a determined democratic opposition at the ballot box, the Trump administration will persist with a tax and tariff policy aimed at creating the sorts of social inequity and economic privilege not seen since Mark Twain’s original Gilded Age. Consequently, the grim economic results down the line are painfully predictable.
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