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Posts Tagged ‘Gilded Age

“What is it that happens in an inflation? The unit of money suddenly loses its identity.”*…

Today the Bureau of Labor Statistics releases its Consumer Price Index for the month of March. Here is some important context to help understand the figures…

When inflation numbers come out on April 13, they will likely look very high. And measured annually, inflation will probably rise further over the next few months. These headline numbers will be used to argue against the American Jobs Plan and future infrastructure investments, and even to advocate austerity.

But this response will be wrong, for three reasons:

1) The high year-over-year inflation of the coming months will reflect the falling prices of a year ago, whether or not prices are rising more rapidly today.

2) Achieving the Federal Reserve’s price-stability goals requires a period of above-trend inflation; if inflation, correctly measured, rises modestly in the coming months, that’s a good thing.

3) Even if inflation is a genuine problem, scaling back infrastructure investment is not the solution. It might even make the problem worse…

The full explanation at “The Illusion of Inflation: Why This Spring’s Numbers Will Look Artificially High.”

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* Elias Canetti, Crowds and Power

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As we steel ourselves, we might spare a thought for James Buchanan “Diamond Jim” Brady; he died on this date in 1917. A businessman and celebrity in the Gilded Age, he made his fortune semi-scrupulously in the rail industry and less scrupulously in stock trading and fixed bets.

His appetites for indulgences of all sorts were legendarily huge; but his nickname was a nod to the main among them– to his obsession with jewels, especially diamonds. He amassed stones worth $2 million (equivalent to approximately $61,464,000 in 2019 dollars).

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“I wasn’t worth a cent two years ago, and now I owe two million dollars”*…

If you think that our democracy cannot endure with the economic inequality that afflicts the 21st century, go back to the Gilded Age, when Americans worried that the nation could not stand with the economic inequality that arose in the late 19th century. If you think that the nature of work is changing dramatically, go back to the Gilded Age, when the economy was transformed. If you worry that changes in the environment are threatening health and humanity, go back to the Gilded Age when urbanization and industrialization gave birth to those worries. These parallels allow us to step back from the concerns we’re immersed in now and think about our world in new ways. The long lens of history shows us what we’re too myopic to see in the present…

Historian of the period Richard White recommends “The best books on The Gilded Age.” His five choices are each and all eminently worthy of reading; but his explanations for his choices are an education in themselves.

* Mark Twain, The Gilded Age

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As we peer into the not-so-distant-mirror, we might recall that it was on this date in 1867, at the dawn of the Gilded Age, that U.S. Secretary of State William Seward and Russian minister Eduard de Stoeckl agreed to a treaty effecting the purchase of Alaska by the U.S.; it was briskly ratified by Congress.

The transaction added 586,412 square miles of new territory to the United States at a cost of $7.2 million 1867 dollars (2 cents per acre); in 2019 dollars, the price was $132 million (37 cents per acre).

he US $7.2 million check used to pay for Alaska

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Written by (Roughly) Daily

March 30, 2021 at 1:01 am

“She had everything she wanted, but she still felt, at times, that there were other things she might want if she knew about them”*…

Edith Wharton

The Custom of the Country” (1913), like much that Edith Wharton wrote, can be described as a novel of manners. That’s to say, a social fiction in which the carefully observed customs of a particular society shape the characters’ actions and the plot. The designation somehow implies frivolity, or at least, traditionally, the feminine or domestic sphere (Jane Austen could be considered the first author of such works); and in this period of profound crisis in American society, it might seem easy to dismiss the relevance of such diverting works…

In this case, Wharton follows the social rise (and rise) of beautiful young Undine Spragg (named after her grandfather’s patented hair-crimper), who arrives in New York City from the fictional town of Apex City, Iowa, in the company of her newly moneyed, wide-eyed parents, Abner and Leota. She initially takes instruction on New York society’s hierarchies from gossip columns and her manicurist, but Undine’s looks soon gain her entrée into conversation with a fashionable portraitist named Popple, and then an invitation to dine at the home of the elegant Fairfords, where Mrs. Fairford’s brother, Ralph Marvell, pays her particular attention. On their eventual honeymoon, he’ll introduce her to European and in particular Parisian society, thereby widening the horizons of Undine’s social ambition: New York comes to feel provincial and dull next to Paris.

The fact that “The Custom of the Country” is entertaining — that it seems to whisk us, as readers, to a faraway time and to glamorous places — doesn’t mean that Undine Spragg’s dogged rise through the social ranks of the early 20th century is irrelevant to our times. Wharton’s clear but complex vision (whether Undine is ultimately heroine or antihero is not entirely obvious) follows her protagonist as she navigates ever more rarefied realms, from the dining rooms and opera boxes of Manhattan to the spas and châteaus of France, each with its own language and conventions, in search of the ultimate triumph — though what that may be, beyond enormous wealth, is never entirely clear, and remains just out of reach… A quick study, she busily absorbs the conventions wherever she lands (she proves a masterful code-switcher, as we might say now), but she’s also resolutely, selfishly, intractably herself, ready to flout convention if and when she can get away with it. Always gorgeous and elegantly dressed — her husband, Ralph, describes her face when in society as “like a theatre with all the lustres blazing” — Undine is nevertheless limited by her vapidity. As an American friend married to a French aristocrat explains, “You’re as handsome as ever; but people here don’t go on looking at each other forever.”…

Wharton’s genius lies in her novelistic ability to allow her characters their perspectives while seeing the situation from all sides. Both in her lifetime and since, she has been maligned for being born rich (Franzen complains that “privilege like hers isn’t easy to like; it puts her at a moral disadvantage”); and Janet Flanner accused her, in a waspish 1929 New Yorker profile, of lacking sensuality and sympathy, of “formally proving that the wages of social sin were social death.” But in fact Wharton — who could well have sat around in her fancy houses eating bonbons with her feet up rather than writing wonderfully entertaining, humanly true novels that have stood the test of time — turned her critical eye equally upon transgressors and upholders of convention alike. That’s not to excuse her snobbery or to overlook the limitations of accounts of high society; but now, as then, we’re fascinated by the lives of the wealthy, and shouldn’t project our own secret shame about it onto Wharton. Her sharp wit is hard on all her characters, and crucially, she captures also their redeeming qualities, their humanity. She sees and understands Undine’s laser-focused ambition, her parents’ trembling and self-sacrificing indulgence, Ralph’s highly cultured but weak romanticism, Elmer’s robust desire for material success. And she appreciates also Undine’s splendor, her vitality and allure, Ralph’s delicacy and tenderness, Elmer’s frankness and generosity. Like the novel’s discreet and cheerful Mrs. Heeny, masseuse and manicurist to the rich, who travels from house to house with her bag full of press clippings, Wharton observes and records it all. In this new Gilded Age, when the disparities between rich and poor are again, and disastrously, as great as they were in Wharton’s time, we could do with such a novelist, a cultural anthropologist who might hold up a mirror to our failings and our future, with eagle-eyed clarity and a small measure of compassion…

Novelist, essayist, and professor Claire Messud on the contemporary relevance of the chronicler of the Gilded Age: “How Can We Read Edith Wharton Today?

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  • Edith Wharton, The Custom of the Country

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As we peer into the not-so-distant mirror, we might send closely-observed birthday greetings to Marie-Henri Beyle; he was born on this date in 1783. Better known by his pen name “Stendahl,” he is remembered especially for his novels The Red and the Black (Le Rouge et le Noir) and The Charterhouse of Parma (La Chartreuse de Parme). One of the first practitioners of acute explorations of his characters’ psychology, he is considered a pioneer of realism– and with Wharton, one of its finest examples.

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“Social rank has always been one of the pricier commodities sold in the great American department store”*…

 

Gilded Age Ball

As the Gilded Age began, a new social format was being created that would give shape and structure to the fashionable world for the next few decades — and launch those daughters of the newly rich, the real-life ‘buccaneers’, across the Atlantic. At the heart of the stratagem designed to create what would become known variously as ‘Society’ and the ‘Four Hun­dred’ was one man, a Southerner named Ward McAllister. … Even in an age of social striving, he was known as a snob.

Connected by birth to some of the old New York families, in 1852 he had married an heiress and a few years later had settled in Newport, where his style of entertaining soon began to be copied. … He had … travelled extensively in Europe, where he soaked up everything he could about court and aristocratic customs. On his return to America he determined to become the self-appointed arbiter of its society and the customs it should follow.

He had already been successful in shaping the society of New­port. Now, he decided, it was time to tackle the one city in America pre-eminent in wealth, drawing power, sophistication and general glitter: New York. A man might have made a fortune by planting a Midwest prairie with wheat — but it was to New York that his wife, avid to spend this new wealth, now insisted they move.

“McAllister’s cleverness lay in realising that the newly rich were there to stay; more and more millionaires appeared each year and the relentless tide of wealth would soon flood the passive Knickerbockers completely — unless something were done about it (not for nothing were these newcomers known as ‘the Bounc­ers’). He also recognised that any society had to have a leader, whom everyone would accept without question — if not, it would degenerate into a formless mass riven by bitter internal struggles.

There was only one person fit for this position and she, al­though beleaguered by the strivings of ‘Bouncer money’, as parvenu wealth was called, already occupied it. Caroline Astor would continue to be the queen.

He decided to use the most desirable members of both old and new as the foundation stones of the new order. To select these, he formed a small committee (‘there is one rule in life I invariably carry out — never to rely wholly on my own judgment’); a little band that met every day for a month or two at McAllister’s house, making lists, adding, whittling down, forming judgements.

Eventually, twenty-five men, all wealthy, some from old fam­ilies, some from the new rich but all considered to be men of integrity, were chosen and invited to become ‘Patriarchs’, as they would in future be known. They would give two and sometimes three balls a season, as exquisite as possible, with each Patri­arch in return for his subscription of $125 having the right to invite to each ball four ladies and five gentlemen, this number to include himself and his family; all distinguished strangers (up to the number of fifty) would also be asked, their names to be run past McAllister. Everyone asked to be a Patriarch accepted immediately.

As McAllister had rightly foreseen, the exclusiveness of these balls was what gave them their magnetic power. ‘We knew … that the whole secret of the success of these Patriarch Balls lay in making them select … in making it extremely difficult to obtain an invitation to them, and to make such invitations of great value [so that] one might be sure that anyone repeatedly invited to them had a secure social position.’

“The first of the balls was given in the winter of 1872. With them, McAllister achieved absolute social power.

Applications to be made a Patriarch poured in, the great ma­jority turned down but often with the door left tantalizingly ajar.

The invention of the “Four Hundred,” the preeminent members of New York society in the Gilded Age: via Delanceyplace.com, an excerpt from Anne de Courcy’s The Husband Hunters.

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* “Social rank has always been one of the pricier commodities sold in the great American department store, and the ceaseless revision of what constitutes society gives rise to the great American comedy that has been playing continuous performances since the beginning of the Republic. As one generation of parvenu rich acquires the means to buy the patents of nobility, it looks down upon the next generation of arrivistes as clubfooted upstarts.” — Lewis Lapham

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As we recall that there have been lots of ways to “come out” over the years, we might spare a thought for three women whose public introduction to society was about as horrific as can be imagined: it was on this date in 1692 that  Sarah GoodSarah Osborne, and Tituba are brought before local magistrates in Salem Village, Massachusetts, beginning what would become known as the Salem witch trials.

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Written by (Roughly) Daily

March 1, 2019 at 1:01 am

“These days, the bigger the company, the less you can figure out what it does”*…

 

Late 19th-century Americans loved railroads, which seemed to eradicate time and space, moving goods and people more cheaply and more conveniently than ever before. And they feared railroads because in most of the country it was impossible to do business without them.

Businesses, and the republic itself, seemed to be at the mercy of the monopoly power of railroad corporations. American farmers, businessmen and consumers thought of competition as a way to ensure fairness in the marketplace. But with no real competitors over many routes, railroads could charge different rates to different customers. This power to decide economic winners and losers threatened not only individual businesses but also the conditions that sustained the republic.

That may sound familiar. As a historian of that first Gilded Age, I see parallels between the power of the railroads and today’s internet giants like Verizon and Comcast. The current regulators – the Federal Communications Commission’s Republican majority – and many of its critics both embrace a solution that 19th-century Americans tried and dismissed: market competition…

The current controversy about the monopolistic power of internet service providers echoes those concerns from the first Gilded Age. As anti-monopolists did in the 19th century, advocates of an open internet argue that regulation will advance competition by creating a level playing field for all comers, big and small, resulting in more innovation and better products. (There was even a radical, if short-lived, proposal to nationalize high-speed wireless service.)

However, no proposed regulations for an open internet address the existing power of either the service providers or the “Big Five” internet giants: Apple, Amazon, Facebook, Google and Microsoft. Like Standard Oil, they have the power to wring enormous advantages from the internet service providers, to the detriment of smaller competitors.

The most important element of the debate – both then and now – is not the particular regulations that are or are not enacted. What’s crucial is the wider concerns about the effects on society. The Gilded Age’s anti-monopolists had political and moral concerns, not economic ones. They believed, as many in the U.S. still do, that a democracy’s economy should be judged not only – nor even primarily – by its financial output. Rather, success is how well it sustains the ideals, values and engaged citizenship on which free societies depend.

When monopoly threatens something as fundamental as the free circulation of information and the equal access of citizens to technologies central to their daily life, the issues are no longer economic.

Stanford historian Richard White unpacks an important historical analogue; read it in full at “For tech giants, a cautionary tale from 19th century railroads on the limits of competition.”

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* Michel Faber, The Book of Strange New Things

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As we wonder if The Invisible Hand is giving us the finger, we might recall that it was on this date in 1852 that Henry Wells and William G. Fargo joined with several other investors to launch their eponymously-named cross-country freight business.  The California gold rush had created an explosive new need, which Wells, Fargo and other “pony express” and stage lines leapt to meet.  It was after the Civil War, in 1866, when Wells, Fargo acquired many of their competitors, that it became the dominant supplier.  (Ever flexible, they adapted again three years later, when the transcontinental railroad was finished.)

From it’s earliest days, it also functioned as a bank, factoring the shipments of gold that it carried.  Indeed, when Wells, Fargo exited the freight business as a result of government nationalization of freight during World War I, the bank (which merged with Nevada National in the first of a series of “transformative transactions”) continued to operate as “Wells, Fargo,” as indeed it does (albeit under unrecognizably evolved ownership) today.

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Written by (Roughly) Daily

March 18, 2018 at 1:01 am

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