Apart from a brief period called the Panic in 1907, the American capitalist machine hummed along like a fully functional dynamo throughout the period of its Gilded Age. The acknowledged robber barons at this time were fully in control of the economy. This is why J.P. Morgan was able to rally his fellow bankers to bail out the government Treasury when it encountered a little problem which caused a panic. The intervention was swift. It had to be, otherwise it would have escalated into a full blown crisis with the capacity to cause extensive damage to the economy. Instead, the effects of the Panic were restricted to what could be regarded as a storm in a teacup. Nevertheless the lesson learnt from this episode was that no economy however buoyant can be taken for granted.
By the turn of the twentieth century the USA had acquired the muscle to enforce the Monroe doctrine. This was clearly shown in 1898 when she went to war against Spain in an encounter that not only secured the independence of Cuba but had led to the acquisition of overseas territories in Guam, Puerto Rico and the Philippines. The message that was sent out was that the USA was now ready and capable of dictating terms to any European country that appeared not to acknowledge her hegemony within the Western hemisphere, following the dictates of the Monroe doctrine. It may have taken seventy years to become fully operational but it had arrived at last.
True to her anti-colonial principles however, America showed off her anti-imperialist credentials such as it was at the time. This, she did by her refusal to be drawn into the colonisation of any parts of Africa. She had been invited to participate in the Berlin conference but had walked away from the table without joining the bandwagon of the colonial powers which had carved up Africa between them like the proverbial stuffed turkey. America was present but was not tempted to partake of the fare on offer.
This is however not to say that all was well within the Republic. As a group, the robber barons were swimming in great wealth but this was at the expense of those from whose blood, sweat and tears all that stupendous wealth was being mined. The robber barons played hardball with their competitors but were even more ruthless with their employees who lived in the richest country in the world but saw very little of those riches. Still, the little they had was a small fortune compared with what the wage slaves were earning in Europe and so, the USA, seen from across the Atlantic was a magnet, a bright light which attracted all the moths. They sailed across the sea, arriving on Ellis island under the shadow of the Statue of Liberty in New York from where they swarmed all over their new country. Many of them were skilled workers who had come to embellish the skill pool in America but skilled or not, they were all victims, to be maximally exploited by the robber barons and their accomplices. The physical conditions under which they lived were as atrocious as any that existed in Britain a hundred years before and their employers devised ever growing diabolic ways of fleecing them. Apart from low wages, some employers paid their workers in scrips, currencies whose value was recognised only in shops owned by the employers. Since the wages they were paid were grossly insufficient for their needs, they were forcibly tied to their employers to whom they were chronically indebted. The ground was therefore ripe for union activities which over time led to an amelioration of the conditions of service within places of work within which the workers toiled.
Apart from the labour unions, there were political organisations; the socialists, communists and even anarchists who took very strong interest in the welfare of the workers. It is a matter of interest that it was an anarchist that was responsible for the assassination of President McKinley in 1901, at a time when the American economy was booming. Despite the boom, the majority were still struggling very hard to make a bare living. The anarchists placed the blame for this at the feet of the president so, he had to die. There are works of fiction which tried to paint a vivid picture of the industrial relations landscape of that period. In my estimation, one of the most graphic of such books was The jungle written by Upton Sinclair, a socialist who was appalled by the inequalities which ruled the USA and quite spoilt the lives of the vast majority of Americans. Jack London was another socialist whose satirical novels tried successfully to capture the injustice which governed both the economic and social relations in the country within that period of capitalist consolidation in the USA.
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The rock on which American international relations was built in those years was isolationism. After all she was in natural isolation, protected as she was by several thousand miles of ocean on both sides. Her neighbours to the north and the south were politically insignificant countries which then and now did not present any threat to the behemoth which was the USA. Living in geographic isolation was not enough, the USA further surrounded herself with a wall of tariffs behind which her infant industries could grow. This of course enhanced the ability of the robber barons to further enrich themselves. When WW I duly erupted in Europe, the Americans were well placed to reap rich dividends from the supply of both agricultural and military products mainly to Britain and France. It took a little time for American factories to be retooled and made ready for the production of military hardware but as soon as this was done, lucrative orders for the supply of clothing, food and military stock began to roll in. The high rate of unemployment which was held as a threat over the work force was considerably reduced and wages went up significantly. On their own, the bosses were laughing all the way to the bank. By the time America entered the war in April 1917, she had established herself as a major global power and when she sent an army of three million men to fight in Europe, no less than a million women were recruited into the work force. The sun was shining with uncommon benevolence on the USA.
It has to be said that there was a little period of readjustment after the war as returning soldiers were being reintegrated into the workforce. By the end of 1921 however, the economy was bubbling over quite merrily giving way to what has been described as the Roaring Twenties. This was a period of joyous abandon during which the nation let down her collective hair and furiously danced a decade away. They could afford to make merry because there were opportunities everywhere for productive employment everywhere. This drew millions of black people from the backwoods of the segregated South to the less restrictive urban cities of the North. Many of them were drawn to New York, particularly the neighbourhood of Harlem. This is where black artists, musicians, writers, poets, entertainers and other creative groups of black people came together to create what has been called the Harlem Renaissance. However, it was all too good to last as October 1929 came around and the bubble burst spectacularly as the Great depression kicked in.
Right from the beginning of the Industrial revolution, the growth of capital has been cyclical. Periods of boom have been followed by those of recession and the occasional depression. These cycles, at least at the beginning were usually caused by local events such as political disturbances, poor harvests, wars as well as any number of unforeseen circumstances. It is also possible that instability is an intrinsic factor of capitalism. The nature of the beast. Many people, especially those on the right of the political spectrum, that is, those who have well developed capitalist tendencies believe very much in the invisible but powerful forces generated by the market. They consider any form of control by any recognised group such as governments as undue interference in the sacred rites of capital accumulation. And yet from time to time, the market such as it is, needs to be reset sometimes through the injection of capital from somewhere outside the market. This, for example, is what was done by J.P. Morgan and his colleagues in 1907 when they averted a recession by the injection of needed capital at a crucial point in time. In the last hundred years, the global economy has had to endure a succession of crises, enough to suggest that capitalism is a chaotic system which must never be allowed to run itself. Capital can only be accumulated at the expense of certain groups of people, the workers whose labour is expropriated by the owners of capital, those who control the means of production. The current global reach of the market means that an upheaval within the American economy which is now the most dominant in the world, reverberates throughout the world at more than the speed of sound since it is carried around the world electronically. Since 1973, the year of the oil crisis, the world has been troubled almost continuously by one crisis of the other, some have been local, others regional whilst others have been global in extent. The point to be made here is that there is need for balance between many centres but principally between the workers and the owners of capital. It is apparent that productive amity can only be achieved when the balance is tilted towards the producers who form the overwhelming percentage of global population. Unfortunately, the balance has shifted decisively towards the bosses causing the rise and rise of inequality to accompany the now questionable rise and rise of capitalism.