Indeed I should have placed exception markers for financial industries. But would the collapse of contemporary financial capitalism lead to socialism or to gilded age capitalism? Or something else entirely?
Whether gilded age capitalism can make a return is a very interesting question.
Financial capitalism was a "necessity" for an accumulation system that, at the same time it made accumulation the sole driver of economic activity, required mass production and consumption or products and services. For the mass of the people to be able to consume while some others kept accumulating ever more in the pursuit of profit was only possible by making the accumulation a financial process and lending that accumulated money to the consumers. It's an unstable system but it can take quite a while to run its course.
How is "gilded capitalism" different? In the historical US version mass consumption was already important, but infrastructure production, war production, luxury goods, and especially services, those were also important. But this is not a dig difference. So what else was different? There were sources of wealth to be had other than squeezing a public of consumers for all they had! The US had the West to acquire, the robber barons made their fortunes from its exploration (railroads, and its materials, and the new commerce) and for decades there was still more than enough left for the common people involved in that massive conquest and colonization. What was being accumulated at the top, from the bottom, was being "replenished" from that settlement process.
I won't make the same argument regarding european capitalism of that age. Some have done it, arguing that colonialism was essential to early capitalism. But european late 19th century capitalism was different from the "gilded age" capitalism of the US. There wasn't one european capitalism, there were "national capitalisms", or capitalisms using different methods of (temporary) stabilization.
The UK's was perhaps the most similar to the (Eastern Coast) US capitalism: finance and "capital export" played a role in supporting accumulation but so did the industrial production and the Empire of the UK. Its early key markets were Europe and South America before they had to turn more to the Empire, as other european countries got their own "national capitalisms" going in competition.
France's capitalism was more financial than the UK's, but accomplished with the state's direction. It took off after the creation of the Credit Mobilier by Napoleon III in the 1850s, and had a first crisis when it piled uo too many credits in the 1870s. So, "financial capitalism" even back then.
Belgium had the Societé Generale de Belgique and its history can nearly be said to be the history of the country. Early state capitalism?
Italy was a mess impossible to broadly characterise, but no surprise there as it was a new country. The ailing Ottoman Empire, some few technically backwards european countries, and some few other independent states around the world had a role of consumers, net importers both of goods and capital.
I don't know enough about Austria or Prussia, Germany or Russia, to comment on those.
I guess that want I mean to say is: gilded capitalism was not just a system that existed in the past, but one that existed in a few
specific countries in the past. It's only sustainable if you have either:
- external markets for the production, such that people outside the system supply the (monetary) wealth that supports continued accumulation. Examples were the second French Empire, or recent Korea and Japan until the 80s.
- internal sources of new wealth outside the capitalist system, such as new land or new valuable natural resources. Some oil rich states, for example, practice a form of "gilded capitalism", you can see it in the palaces of old pre-soviet Baku or in some recent arab sheikdoms now busy embracing "modern economy".
"Gilded capitalism" can exist now, arguably does exist in some countries, and it can exist in the future also. But
not as a global system. It must have a boundary, not be completely closed but restricted, and it must have a source of wealth (consumers) from outside that boundary so as to sustain accumulation.
In a really
closed system such as the whole world the profits must all be recirculated to keep the system going, and that means getting them spent by consumers. Either consumers (the mass of the people, workers and non-workers) get as much in income as they consume, which restricts profit accumulation (there is little surplus retained to accumulate to business owners, as wages and taxation must support consumption), or profits must be supported with loans to consumers. Ever-increasing loans. That is financial capitalism. And because a "globalized" world is a single system, financial capitalism is the only form of capitalism we can have under "globalization", with totally open borders for trade and capital. The worldwide financialization of capitalism was the inevitable result of trying to create a "globalized" capitalism.
When I say inevitable, well,
in theory there was an alternative: the "ownership society": if many people were owners of business ("investors" in stocks, it is usually assumed) then profits would be recirculated as income to consumers through that mechanism. The problem is that this ownership, in practice, always gets terribly concentrated because having wealth begets additional wealth
faster: those with less wealth spend a greater fraction on consumption, the more wealthy can invest more in extending their ownership and this increasing their share of the overall profits. The accumulation and concentration process cannot be escaped, under capitals logic, even if everybody starts with exactly the same amount of wealth. The ownership society was a lie.
