Second Industrial Revolution

If you miss enough payments, the lender will repossess your vehicle or home through foreclosure.

In the 1800s, during the Second Industrial Revolution, short-term personal loans became popular with Americans.

Furniture, farming equipment, and sewing machines were investments that were only affordable when paid in installments.

These days, short-term consumer loans are typically offered only by select businesses for large, infrequent one-time essentials like furniture or appliances.

And when he's writing this in 1899, Veblen is seeing the very beginnings of it starting to happen.

Because by this point, this is when the sort of huge transition to an industrial society, which is generally called the Second Industrial Revolution, this had been going on for you know, a few decades, and it started, I think, a little bit before Veblen was even born, which ended up just sort of flooding the world with incredible amounts of cheap physical goods, which had been used as these sort of ways of distinguishing the classes in his day of, like, You would walk around and like, OK, so here are the guys who are wearing the fancy clothes and the top hats, and they must be rich because literally no one else could afford to buy those clothes.

If you were poor, then like you just did not have enough money to get that stuff.

Now, clothes are very cheap.

In finance capital, Hilferding contrasted what he called finance capital, which he said existed in Germany and the United States.

And he said that in these countries, in the context of the Second Industrial Revolution, with its huge investment needs, these banks had become centrally involved in providing investment credit.

This he contrasted sharply with the British model.

which remained reliant on providing short-term commercial credit.

And back to prosperity, I went deeper to identify the source of that unwinding.

The Great Unwinding links back to the beginning of the Second Industrial Revolution in the late 1800s, where economies of scale became the competitive advantage.

Geography shifted first.

Steam and steel replaced wood and wind.

We make a big deal about the modernization that's happening within the Navy in the late 19th century.

And this is a situation where we have a labor data set that can capture both before the Second Industrial Revolution and after the Second Industrial Revolution.

And the Navy went through its Second Industrial Revolution in a major way in the late 19th century by switching from the wood to the steaming, to oil, to gas.

to ordinance changes.

I mean, the technologies that the Navy underwent was enormous and it really shook up what skills were necessary to perform.

Uh-huh.

According to me, the average Kenyan, we are not past the second industrial revolution.

Revolution.

Mm-hmm.

Mm

... to do a bit of agriculture.

We had the Second Industrial Revolution where we are now using tools-

Mm

It makes a mockery of the notion of government of the people, by the people, for the people.

Most of the people in the country are getting abused by this colossus that is the second industrial revolution, uh, the unbridled capitalism of the United States.

Now, this is not to knock- capitalism itself, but to n-not the kind of capitalism that was going on in the 1880s and the 1890s and the early 20th century.

So what those, you know, tho-those people that we call the robber barons, this, this, you know, 3% of the 1% who own so much of the, the value and who are running the corporations that people are working for, they buy senators, and by buying senators, they buy, uh, Supreme Court justices, and they buy senators by buying, uh, state legislators.

So by any measure, and this, this is b-by no means controversial at all except some real outlier apologist historians today, American democracy was not a democracy in the 1880s, 1890s, early 1900s.

And these robber barons essentially took lessons that they learned from the antebellum South and from the Jim Crow South of the 1870s and 1880s, and they were applying it to the immigrant populations that were entering into the United States.

Of course, there's a, a massive influx of immigrants into the United States in order to do the work of the Second Industrial Revolution.

And there is a deep sense among people who call themselves Native Americans.