Excessive Inequality Research Articles

Trust and Social Inequality: The Case of Russia

The article focuses on the study of relationship between trust and social inequality in Russian society. The methodological framework is an integrated multidisciplinary approach which combines sociological and economic theories. The research is based on official statistics and social surveys of international, national, and regional levels. The analysis shows that in Russia there is still excessive inequality (since 2003, the fund ratio has not dropped below 15 times, and the Ginny index is below 0.4). Using the method of two-dimensional distributions, we assessed the impact of social inequality on the level of generalized trust in Russia as a whole and the Vologda Oblast in particular. It was revealed that the Russian society is characterized by a low level of social trust and its increasing trends cannot be predicted. The existing mistrust is compounded by the stratification of society, persistence of significant differences in the level of well-being of the population, and the lack of mutual understanding between the poor and the rich. The article confirms the fact that the level of generalized trust depends on the economic component: with a decrease in well-being of the population, the level of mistrust grows. We conclude that the variables of inequality and trust form a vicious circle with poles of inversely proportional impact on each other. The practical task is to find a solution to the current situation. As a further research prospect, the article indicates the development of science-based proposals in solving the problem of the relationship between social inequality and public trust.

Social well-being as a reflection of socioeconomic inequality in the country

This article substantiates social well-being of the population as one of the key indicators of socioeconomic inequality. The author advances a scientific idea is that the system of allocation of income and national wealth formed in the post-Soviet Russia, when excessive advantages of some (small social groups) are provided at the cost of limiting functional capabilities of others (larger social groups), which severely contradicts the basic principles of inclusive society and cannot be recognized as socially fair. The conducted analysis of the peculiarities of inequality in post-Soviet Russia describes it as “socially unfair” and excessive. Such inequality negatively affects social well-being of the individuals. It is demonstrated that excessive inequality, with characteristic massive poverty (absolute and relative), in the meta-space of social well-being of the population or the Russian Federation, the prevalent type of life realization of an individual is the “negative expectations”; most significant risk factors for the worsening of social well-being are moral and emotional state of society and some status characteristics of the individual (level of education, professional activity). Using cluster analysis, the author tests the hypothesis on the impact of excessive inequality upon the level of manifestation of deviant behavior of the people in the constituent entities of the Russian Federation. Recommendations are formulated on amending the redistributive policy of the government aimed at reduction of socioeconomic inequality and improvement pf social well-being of the population.

РЕЦЕНЗИЯ НА КН.: ВИТТЕНБЕРГ Е.Я. СОЦИАЛЬНАЯ ОТВЕТСТВЕННОСТЬ ВЛАСТИ. М.: РГГУ, 2020. 686 С.

The monograph submitted for review is the second one in the author’s planned series of three books on the social responsibility of businesses, authorities, and civil society. In 2011, the publishing centre of Russian State University for the Humanities published the first monograph in that series of the author, Social Responsibility of Businesses in the post-Soviet space, in which the large empirical material showed complex factors for the formation of social responsibility of businesses in the post-Soviet countries in the course of business activities in the economic, political, and social spheres. The second work of the author called Social Responsibility of Authorities is a complex work, which presents a critical analysis of the social responsibility of the authorities in post-Soviet Russia for the selection of goals and ways of the country development, for the degree of and price for achieving the goals, and for the quality, results, and impact of implemented system change affecting all spheres of public life. The monograph considers a number of theoretical issues: the genesis and development of the basic concepts for social responsibility of authorities, its criteria and indicators, the causes of irresponsibility of authorities, the boundaries and responsibilities of state institutions, the questions of forming the shared social responsibility in all its subjects (authorities, businesses, and society). The author analyses the social responsibility of the authorities in the field of economic policy (stages and processes of privatisation, creating conditions for fair competition and innovative development), in the modernisation of Russian society (achievements and shortcomings in the fight against poverty, in the formation of the middle class, in evening out excessive social inequalities), and also analyses measures for the development of democracy.

СОЦИАЛЬНЫЕ ОСНОВАНИЯ ПОЛИТИЧЕСКОЙ КОНФЛИКТНОСТИ

The article deals with the sociological aspects of the analysis of political conflict related to the socio-structural and subjective foundations of political processes and relations. It is shown that many problems and contradictions in the social sphere, such as social polarization, excessive inequality, poverty and violation of the principles of social justice, deprivation of basic needs and interests, unstable labor employment significantly determine the field of politics and are projected on the object and subject of political conflict, weighing down their course and positive outcomes. The insolubility of social problems and contradictions, their encapsulation cause either a decrease in the population's interest in politics, in the effectiveness of democratic institutions, con- tribute to the widening of the gap between "private" and "public", generate a sense of political alienation and powerlessness, or push to meet basic needs beyond the existing social norms and political institutions, to destructive forms of resolving political conflicts, which leads to a loss of control of society and social catastrophe. Sociological analysis of the subject cross-section of conflict interaction shows that a conflict based on group interests (in comparison with class and elitist) contributes more to maintaining a dynamic balance in society and realizing the positive potential of political conflict, since it is characterized by flexible intra-group connections and mobile inter-group barriers in the socio-political system. Class and elitist models of conflict tend more to vertical polarization of society, which strengthens the "discontinuous" lines of interaction between the "top" and "bottom", makes the dichotomy "rule-submission" rigid, and reduces the possibilities of dialogical plasticity and flexibility of the political system.

Social Behavior of Students in Higher Education (Based on the Results of a Sociological Study in the Rostov Region, Russia)

The transformational processes in the field of higher education in Russia, associated with the introduction of new educational practices, actualize the importance of studying changes in the social behavior of university students. The main purpose of the study was to clarify the characteristics of the social behavior of university students, conditioned by external and internal factors. The methodological construct included synthesis of socially deterministic and neoinstitutional approaches, the theory of mental programs, the theory of generations, the value approach of M. Rokeach, as well as the activity-based approach to the study of social practices. Reforms in the higher education system in Russia, which were accompanied by the emergence of a new educational environment and excessive social inequalities, were studied as external factors. Mental programs were studied as internal factors, which included ideas about education as a terminal and instrumental value, attitudes and motives of practices. The research was based on the data of the authors' questionnaire survey of 382 students from 7 universities of the Rostov region. Identifying the features of the mental programs of university students and their educational practices made it possible to identify six types of social behavior of students in the educational sphere: traditional, career, pragmatic, traditional and career, traditional and pragmatic, and career and pragmatic. The analysis of the results allows drawing conclusions about the high readiness of students to new educational practices, which are still poorly implemented. At the same time, motivation depends on mental programs, and the educational practices themselves depend on the conditions created in universities. The results of the study may be of interest to specialists dealing with the issues of social behavior of students in the context of transformations of the higher education system.

Intersectional equity in health care: assessing complex inequities in primary and secondary care utilization by gender and education in northern Sweden

BackgroundKnowledge remains scarce about inequities in health care utilization between groups defined, not only by single, but by multiple and intersecting social categories. This study aims to estimate intersectional horizontal inequities in health care utilization by gender and educational level in Northern Sweden, applying a novel methodological approach.MethodsData on participants (N = 22,997) aged 16–84 years from Northern Sweden came from the 2014 Health on Equal Terms cross sectional survey. Primary (general practitioner) and secondary (specialist doctor) health care utilization and health care needs indicators were self-reported, and sociodemographic information came from registers. Four intersectional categories representing high and low educated men, and high and low educated women, were created, to estimate intersectional (joint, referent, and excess) inequalities, and needs-adjusted horizontal inequities in utilization.ResultsJoint inequalities in primary care were large; 8.20 percentage points difference (95%CI: 6.40–9.99) higher utilization among low-educated women than high-educated men. Only the gender referent inequity remained after needs adjustment, with high- (but not low-) educated women utilizing care more frequently than high-educated men (3.66 percentage points difference (95%CI: 2.67–5.25)). In contrast, inequalities in specialist visits were dominated by referent educational inequalities, (5.69 percentage points difference (95%CI: 2.56–6.19), but with no significant horizontal inequity – by gender, education, or their combination – remaining after needs adjustment.ConclusionThis study suggests a complex interaction of gender and educational inequities in access to care in Northern Sweden, with horizontal equity observable for secondary but not primary care. The study thereby illustrates the unique knowledge gained from an intersectional perspective to equity in health care.

The labor share and income inequality: some empirical evidence for the period 1990-2015

PurposeThe purpose of this paper is to analyze empirically the relationship between the labor share and income inequality, as measured by the Gini coefficient and by the income shares for different quintiles, during the period 1990–2015 for 62 developed and developing countries.Design/methodology/approachThis study uses panel data techniques to analyze empirically the relationship between the labor share and income inequality.FindingsThis paper finds that a lower labor share is associated with a higher Gini coefficient. A lower labor share is found to be strongly associated with a smaller income share for the lowest two quintiles and larger income share for the highest quintile and weakly associated with a smaller income share for the third and fourth quintiles. Moreover, this paper finds that the lower the quintile, the stronger the impact of the labor share on the income share of the quintile.Social implicationsPolicymakers should take into account the evolution of the labor share. Public policies that improve labor market outcomes, such as those aimed to promote participation in the labor market and strengthen the human capital of low-income groups, seem necessary to prevent the rise in economic inequalities. Moreover, as the digital transformation of society progresses, policies to promote skill deepening may have an important role in reversing excessive inequalities.Originality/valueHow changes in the labor share are associated with changes in the Gini coefficient, and how this is driven by income shares for different quintiles, for a broad range of countries during the most recent period, has not been comprehensively studied using panel data techniques.

Социология политического конфликта

The article deals with the sociological aspects of the analysis of political conflict related to the socio-structural and subjective foundations of political processes and relations. It is shown that many problems and contradictions in the social sphere, such as social polarization, excessive inequality, poverty and violation of the principles of social justice, deprivation of basic needs and interests, unstable labor employment significantly determine the field of politics and are projected on the object and subject of political conflict, weighing down their course and positive outcomes. The insolubility of social problems and contradictions, their encapsulation cause either a decrease in the population's interest in politics, in the effectiveness of democratic institutions, contribute to the widening of the gap between the «private» and «public», generate a sense of political alienation and powerlessness, or push to meet basic needs beyond the existing social norms and political institutions, to destructive forms of resolving political conflicts, which leads to a loss of control of society and social catastrophe. The sociological analysis of conflict interactions based on the predominance of horizontal connections and relationships contributes more to maintaining a dynamic balance in society and realizing the positive potential of political conflict, as it differs in flexible intra-group connections and mobile inter-group barriers in the socio-political system. Excessive class divisions and inequality tend to vertical polarization of society, which strengthens the «discontinuous» lines of interaction between the «top» and «bottom», makes the dichotomy «rule-submission» rigid, and reduces the possibilities of dialogical plasticity and flexibility of the political system.

Relevance of Developing a National Programme to Increase Income, Reduce Poverty and Inequality

The Object of the Study. Russian citizens. The Subject of the Study. Socioeconomic relations that lead to absolute monetary and non-monetary poverty and high socioeconomic inequality. The Purpose of the Study. Justification of the relevance and approaches to the development of a national Programme to increase real monetary income, reduce poverty and excessive inequality. The Main Theoretical and Empirical Provisions of the Article include a description of the following areas of poverty and socioeconomic inequality in Russia: 1) in monetary income and capital (wealth); 2) in current consumption of goods; 3) in the sectoral aspect; 4) in the provision of comfortable housing and access to social services; 5) in the spatial aspect; 6) in the level and quality of life of urban and rural populations; 7) in age groups; 8) in the use of digital technologies. The estimation of real monetary income, poverty and inequality was carried out based on official social standards and indicators and those developed by the authors. The excessiveness of inequality in Russia is argued. The tools for increasing real monetary incomes, reducing poverty and excessive inequality are substantiated in the framework of the author's proposals to the development of the draft national Programme "Increasing the Population's Income, Reducing Poverty and Inequality". Proposals, stages and deadlines for the implementation of this Programme have been developed, as well as its possible indicators, resource and regulatory support. In the new situation the sensitivity of society to the problems caused by poverty and high inequality is significantly aggravated, which, according to the authors, makes the need to develop a national Programme non-alternative.

Measuring economic inequality: challenges, facts and assessment

Purpose of research.The differentiation of the population in terms of welfare is part of the reality of the modern society and becomes the subject of acute debate. There is a need for a comprehensive assessment of the level of economic inequality and poverty to further substantiate the mechanism of coordination of activities to address the problems of their reduction. The joint use of monetary and non-monetary approaches allows achieving the goal of the study – a comprehensive and objective statistical assessment of the level of economic inequality and poverty of the Russian population.Materials and methods.The information base of the study was the data of the Federal State Statistics Service, as well as materials of analytical and scientific reports “Report on inequality in the world 2018”, “Poverty and income inequality in Russia and abroad”, “Russian society after the presidential elections – 2018: a request for change”, etc. Monetary indicators of economic inequality were used as statistical tools: decile coefficient of funds and Gini coefficient and non-monetary (subjective) approach. The subjective approach to poverty assessment is based on the data of the sample survey of household budgets in 2018.Results.A comparative analysis of economic inequality on a global scale shows that there are significant cross-country differences in income inequality, ranging from lower levels in Europe to high levels in the Middle East. Russia is one of the countries with a strong stratification of the population into rich and poor, where the value of the upper decile is 46% of the national income. The analysis of the dynamics of monetary indicators of economic inequality in the Russian Federation showed their increasing trend over the period from 1995 to 2018 and exceeding the established thresholds. According to the data of 2018, the value of the decile ratio of funds is 15,5 – that is, it is so many times the average income of the rich population exceeds the income of the poor. Gini index value of 0,41 for the same period indicates that the expected income difference between the two randomly selected income pairs will be 82% of the average income. The results of the non-monetary (subjective) approach to assessing economic inequality and poverty showed that the financial situation of 34,4% of households is unsatisfactory (incomes are barely enough for food, buying clothes and paying for housing and communal services are difficult). Even by 53,9% of households noted the lack of funds for the purchase of durable goods.Conclusion.The current situation with the increasing disproportion in the distribution of income of the population of Russia testifies to the active process of stratification of society. The results of the study showed excessive inequality in income of the population of the Russian Federation and the concentration of national wealth in the hands of the “upper” part of the first decile. The subjective approach to poverty assessment confirms the social stratification of society: more than 88% of Russians consider themselves to be poor.

RISKS AND THREATS OF THE ALTAI REGION ECONOMY AND SOCIAL SPHERE ADAPTATION TO CHANGES IN THE EXTERNAL AND INTERNAL ENVIRONMENT

The article is devoted to the study of the regional socio-economic systems' reactions to changes in national macroeconomic parameters. The features of the agro-industrial regions' economy and social sphere adaptation are revealed. The main problems of the development of agro-industrial regions, characterized by peripheral position, are disclosed. The characteristic of restrictions, risks and threats to their development is given. On the example of the Altai Territory, an attempt to comprehensively consider key challenges to the development of the region.
 In the field of economics, the following are identified as threats:
 — de-industrialization of the region economy;
 — limited reproductive capabilities;
 — a significantly deeper fall in labor productivity compared with Russia;
 — lack of conditions for ensuring modernization and qualitative changes in the region economy.
 The three most acute problems in the sphere of population incomes are outlined: low income level; insufficient growth rates; poverty and excessive income inequality.
 The most important demographic risks of the sustainable development of the Altai Territory are revealed: population reduction, aging, and imbalances in resettlement.

Inequality in Prosperous Societies: Economic and Moral Aspects

A free market economy is characterized by an unequal distribution of income, wealth, and opportunities, to the extent that a considerable part of the population does not enjoy the wellbeing which an affluent society can offer. Recent studies have shown that excessive inequality is bad not only for moral reasons but for economic reasons as well. According to the International Monetary Fund, excessive inequality can erode social cohesion, cause political polarization, and lower economic growth due to the shrinking spending power of consumers. According to some estimations, rising inequality in the United States from 1990 to 2010 cut about five percent off the GDP per capita. Economists, such as Anthony Atkinson and Thomas Piketty, have regarded the growing inequality as one of the most serious economic problems of the modern world. In 2015, half of world's wealth was in hands of 1% of the population, and by 2030 the richest 1% may own two-thirds of the wealth. One reason for the increasing inequality is the accumulation of inherited wealth, which causes the economy to be dominated by a few rich families. Another reason is the very high salaries of some sectors, such as top executives of large firms. A third reason is the ability of the rich to pay very low tax rates on their real incomes. Steps to reduce inequality include conventional measures, such as high marginal tax rates on high incomes, a progressive property tax and taxes on inheritance, as well as more radical measures, such as nationalization and an upper limit on wages. Steps to reduce the gap from the lower end include strengthening work unions, improving public education and health systems, and legislating a minimum wage (or a universal basic income) that allows decent living. However, there is no magic formula which fits all. Each country should choose the appropriate combination of steps which fit its economy at a given time, and find the delicate balance between economic equity and free market tenets.

The Stimulus to Violence and its impacts on Mental Health of the Population: A context in the Brazilian Elections / O Estímulo à Violência e seus impactos na Saúde Mental da população: Um contexto vivenciado nas Eleições Brasileiras

In 2018 the presidential dispute in Brazil fomented a series of violent acts throughout the country drawing the attention of the national and international press. Due to the psychological suffering inflicted on the population by the increasing rates of violence in Brazil, aggravated in the last three months in the run-up to the election, it was decided to reflect on mental health in the context of the Brazilian presidential elections. The studies show that where elections are competitive there is a greater probability of electoral violence occurring. Underdeveloped countries appear to be more amenable to this phenomenon because of excessive inequality of distribution / access to resources and political power. The main impacts on the mental health of the population are exacerbation of basic psychiatric conditions (such as schizophrenia and other psychotic disorders); increased fear, insecurity and sadness that produce psychic suffering in the population; and suffocation of social relations by preventing the process of socialization and the full use of spaces to collectivities. Therefore, the debates surrounding the mental health of these populations should be stimulated as they are fundamental for eliciting interdisciplinary public policies that align social and health needs.

Институциональные предпосылки социальной рыночной экономики

The quality of life of people and the degree of focus of market economy on the interests of people depend to a great extent on the structure of public institutes, which include formal and informal norms, rules and the organizations that support them. To develop these norms and rules, it is necessary to rely not only on rational considering and calculation of the interacting parties, but also on habits, customs, and traditions. The universal nature of functions of public institutes always acts in the specific ethical cover that reflects the culture of people, their idea of the social justice focused on three fundamental values: equal opportunities, overcoming excess inequalities, and providing honest rules of the game. The institutionalization process includes stages connected with understanding and acceptance by the majority of the principles of socially oriented economy, development of the particular rules, and mechanisms supporting them. Some institutes perform functions of control over the flaws of the market mechanism, others are aimed at alignment of excess social and economic inequalities and ensuring the compensating advantages to everyone.

Материнский капитал как инструмент перераспределительной политики государства

The relevance of the study is caused by the fact that since 2013, the proportion of low-income families with two or more children has been growing against the background of reductions in fertility in the Russian Federation. The hypothesis of the study is based on the assumption that with growing excessive inequality and poverty of the population, the maternity capital loses the function of stimulating fertility and becomes the only way for low-income families with children to improve their financial situation. The objective of the study is to substantiate the need to improve the state of redistributive policies through providing the maternity capital for each newborn starting with the first child to reduce large family poverty and the reproduction of poverty in the next generations, and to improve the quality of social resources through maintaining the assigned purpose of the maternity capital (housing, education, and health). The article analyzes the actual expenditure of the State under the Maternity Capital Program for 2007–2017 and the projected expenditure with regard to the introduction of additional measures to support families with children from 2019. An estimate of the necessary expenses for paying the maternity capital for each child from the National Wealth Fund is given. For wealthy families, it has been proposed to use an indirect negative tax. The authors give recommendations for improving the procedure of providing the maternity capital for reducing the reproduction of poverty through guaranteeing minimum start conditions for each child. The implementation of the proposed conceptual approach should be carried out in conjunction with reforming the system of taxation of income and individual property, and changing the provision of the maternity capital and targeted social support for families based on an assessment of their needs.

Economic growth and the optimal inequality of income

Inequality of income is one of the significant factors forming social capital. Two views dominate among economists dealing with the influence of income inequality on economic growth. On the one hand, a too low level of income inequality does not motivate people to increase their labour productivity. Low inequality of income might result from an extended social care system and a GDP burdened with social transfers. A good example may be a situation when an unemployed person refuses to accept a job offer and prefers unemployment benefits to a slightly higher salary. Moreover, a lack of incentives for an employee who fails to acknowledge the economic sense of increasing the productivity of his or her work might lead to a slower growth of the economy.
 On the other hand, a contrary view suggests that an increase in inequality of income has a negative impact on the economy. The accumulation of wealth by a small number of citizens raises doubts about the good use of that wealth for the investments necessary for the growth of the economy. Excessive inequality of income is confronted with the disapproval of a significant part of society and is regarded as unfair and unjustified. It may also increase the crime rate, decrease trust and, more generally, lead to the weakening of social capital.
 The arguments presented above lead to the hypothesis that the influence of income inequality on the growth of the economy has a non-linear, parabolic character.
 We have confirmed this hypothesis in growth models of the US and Swedish economies. We assess the historically optimal inequality of income measured by the Gini coefficient at 46% and 24% for the US and Sweden, respectively. The optimal inequality of income for Poland was assessed previously at 29%. The dissimilarities may result from differences in culture, society, educational level and diligence.

Ten rules for public economic policy

This paper discusses ten simple rules for the formulation of public economic policies efficiently, using both old wisdom and recent results. In proposing the ten rules, the normative foundation used is that of social welfare maximization or welfarism. The scientific foundation is the first theorem in welfare economics supplemented by other analyses in economics and beyond. The ten rules are: Using the Invisible Hand; Provision of Essential Public Goods; Reducing Excessive Inequalities Efficiently; Adopt Free Trade and Eliminate Administrative and Collusive Monopolies; Provide Useful Information and Regulation; Raise Taxes Efficiently; Mitigate against Excessive Market Fluctuations; Undertake Public Projects Efficiently; Soft Paternalism; Happiness-Oriented Objectives. Justifications and qualifications are discussed.

Inequality and Unsustainable Growth: Two Sides of the Same Coin?

The relationship between income inequality and economic growth is complex and the evidence mixed. This paper focuses on the connections between income inequality and the fragility of economic growth. We find that longer growth spells—periods of strong, healthy, per capita growth—are robustly associated with more equality in the income distribution, even when controlling for a range of other standard determinants. A key implication is that it would be a gamble to think that distribution will take care of itself provided policy makers steadfastly pursue growth. Over longer horizons, avoiding excessive inequality and sustaining economic growth may be two sides of the same coin.

Relationship between normal and excessive personal income differentiation and regional economic performance indicators

The paper uses A.Yu. Shevyakov’s approach to the decomposition of the Gini coefficient into normal and excessive inequalities, the full deflation method for determining real income and real labor productivity, correlation and regression analysis, and the construction of Cobb–Douglas production functions. Three differentiation levels of normal and excessive inequalities (poverty line, social minimum line, and social well-being line) are proposed. For Russian regions in 2013, the study has found an inverse relationship between real per capita income and the Gini coefficient of excessive inequality, as well as a direct relationship between real per capita income and the Gini coefficient of normal inequality, except for the three most affluent regions, which show a reverse trend of decline in normal inequality. Correlations of normal and excessive inequalities with general development indicators, composition and dynamics of the population, the structure of income and gross regional product, sectoral structure of the economy, and the population’s wealth are revealed. A positive correlation for normal inequality and a negative correlation for excessive inequality with real output in Russian regions are confirmed based on the inclusion of Gini coefficients in the five-factor interregional Cobb–Douglas production function. It is concluded that excessive inequality, on the one hand, is a consequence of the low development level and, on the other hand, suppresses production possibilities and incentives. Normal inequality promotes economic development, which is first accompanied by a growth in normal inequality, followed by a decline.

1896: A Populist Insurgency in America’s First Gilded Age

1896: A Populist Insurgency in America’s First Gilded Age Katherine Unterman (bio) The last time I taught the class “America in the Gilded Age,” I read my students two quotes. One came from a newspaper editorial in the 1890s. The other came from Bernie Sanders in 2015. When guessing which was which, about half of the students got it wrong. The first quote read: “Ninety nine percent of the people of the United States feel that they have a standing grievance against the other one percent because of the excessive inequality in the distribution of wealth [. . .] As this inequality is continually growing greater [. . .] we are drifting toward a revolution.” While this statement could have come straight out of Sanders’ mouth, it is actually from 1891, in the midst of the period that historians call the Gilded Age. Some commentators have called the contemporary era a “Second Gilded Age” because of the similarly growing gap between the richest and the poorest members of society. The term “Gilded Age” comes from a book co-authored by Mark Twain, and the name says a lot about the 1880s and 1890s. It was not the golden age; it was the gilded age. Something that is gilded is gold on the surface, but worthless or rotten underneath. Likewise, the last two decades of the 19th century saw famous “captains of industry” like John D. Rockefeller and Andrew Carnegie accumulating vast fortunes and living in opulent mansions. These were the country’s first billionaires; they were some of the richest men not just of their day, but in modern history. However, underneath the shiny surface, the workers in the steel mills and oil refineries were living in poverty. They resided in crowded tenements and worked long hours, in dangerous conditions, for low pay. The average income for 11 million of the nation’s 12 million families was $380 annually. In 1896, the country was in the third year of a major economic depression. Unemployment nationally was around 15%, even higher in major cities. Farmers were struggling just as much. Throughout the 1890s, they faced falling crop prices, exorbitant railroad rates, high interest on their debts, and costly charges to store their crops. Farmers were barely hanging on before the economic depression, and by 1896, many were on the brink of starvation. Thousands went bankrupt and had to auction off their farms to pay their debts. [End Page 26] Meanwhile, the government was staunchly opposed to the idea of doing anything to help the disadvantaged. President Grover Cleveland, upon vetoing a bill to provide aid to drought-stricken farmers in Texas, said, “I find no warrant for such an appropriation in the Constitution, and I do not believe that the power and the duty of the General Government ought to be extended to the relief of individual suffering.” Later he stated, more succinctly, that government functions “do not include the support of the people.” This was the era of Social Darwinism, and the economic counterpoint to “survival of the fittest” was “laissez faire.” In other words, leave capitalism unregulated and let the free market reign. Government action to help struggling workers and farmers was considered counterproductive and morally wrong. However, an insurgency was brewing from below. Calling themselves “Populists,” impoverished wheat farmers from the West and cotton farmers from the South banded together in their opposition to Wall Street and economic elites. The Populists had a novel demand: that when the people were suffering, the government should step in and help. “Man over money” was their refrain. In 1891, they formally organized a third party, the People’s Party. At the top of their program, called the Omaha Platform: abandoning the gold standard and adding silver as “legal tender.” At this point in time, all currency was redeemable in gold, so the amount of money in circulation was dependent upon the amount of gold in the treasury. By making bills also redeemable in silver (with 16 ounces of silver worth 1 ounce of gold), this would increase the money supply. Farmers wanted this because they believed that, with more money in circulation, they would earn more for their crops and would be able to...