The One Percent and Banking Reform

I propose in this paper to revisit the scene of banking reform at the end of the 19th century, hoping to draw useful comparisons to our own Gilded Age, another time of ideological polarization, confusion, and idiocy, and to remark upon some historiographical conventions that disfigure (1) my account of the origins of the Fed, (2) contemporary writing about how ruling classes rule—or don’t—and (3) how fundamental, even revolutionary change occurs in and after the 20th century.

I’ll work backward from the Occupy moment and movement, suggesting some parallels with the inchoate unrest that defined the crisis of the 1890s and its immediate aftermath.  Then I’ll take up the seeming paradox of Progressive Era reform, when leading businessmen led the way toward effective management of economic crises by means of a central banking system—by means of public policies and regulation that reduced the scope of market forces.  Here I’ll be suggesting that these businessmen played the role of “organic intellectuals” by understanding that their great economic power did not easily translate into cultural authority, and that they could contain the forces of extremism only by becoming reformers who preserved the civilizing content of markets by changing the form of markets.   I will be arguing with most historians of the Progressive Era in claiming that these leading businessmen had a deep and abiding interest in socializing markets—an interest at least as great as any self-professed socialist.  The one percent needed reform, in this sense.

These remarks will set up my more general discussion of (2) and (3) from above, which will allow me to return to the contours of reform and revolution in the present.