How Do America's Super-Rich Get Away With Acting Like 'Just Folks'?

It has become a cliché to say that we live in a new Gilded Age. True enough, up to a point. Money, mostly new money, rules politics and culture. Corporations merge into ever larger corporations. You have to go back to before World War I to match today's levels of income and wealth inequality.

In some ways, the second Gilded Age is worse than the first. Sure, we live longer now, more of us can read and you don't have to be a white man to be able to vote. But to prove my point, consider two big parties, thrown 110 years apart.

In February 1897 elite lawyer Bradley Martin and his wife, Cornelia, threw a costume ball at the Waldorf. J.P. Morgan dressed as Molière, John Jacob Astor dressed as Henry of Navarre and brandished a sword covered in jewels, and fifty women dressed as Marie Antoinette. But the hosts were so nervous about "men of socialistic tendencies" that they surrounded the hotel with Pinkertons and had the first-floor windows nailed shut.

In February 2007 Blackstone CEO Steve Schwarzman threw himself a sixtieth birthday party for hundreds of his closest friends. Rod Stewart sang for about half an hour, earning a million for his efforts. The party was at the Seventh Regiment Armory on Park Avenue -- just seventeen blocks north of the Waldorf. The building has a rich history. In the second half of the nineteenth century the Seventh Regiment, nominally a state National Guard unit, was a kind of private militia staffed by the men of New York's upper class; though they didn't like to fight much, they did put down a strike or two. And the armory itself -- decorations by Louis Tiffany -- was built at the end of the 1870s (with private funds) as part of an urban-fortress building boom driven by the need to suppress the restive working class. We had populists in the heartland, socialists in the cities and labor radicals everywhere, who wanted to subdue corporate power and redistribute some income. The confrontations were sharp and often violent -- but that history is largely forgotten. After the bomb-sniffing dogs had done their work, the biggest security challenge at Schwarzman's party seems to have been keeping the army of photographers safely penned up and nosy onlookers out. No worries about men with socialistic tendencies climbing in the windows to do their revolutionary mischief.

After the Martins' party, there was a huge public outcry at its egregious too-muchness, and the couple exiled themselves to England to escape their critics. After his party, Schwarzman got a little bad press, and some unpleasant questions were raised about the low tax rate his private-equity business operates under, but he was hardly driven into exile. In fact, Schwarzman remains comfortably lodged in one of the most spectacular residences in New York City, a Park Avenue apartment that once belonged to John D. Rockefeller Jr.

It's not just the absence of the socialist threat at Schwarzman's party that marks the difference between the Gilded Ages, though that's pretty striking. The contrast in social pretensions is almost as striking. As Sven Beckert shows in his excellent book The Monied Metropolis, the elite of the first Gilded Age dressed as royalty at the Martins' costume ball because they were consciously trying to project themselves as an upper class in a nominally republican, egalitarian society. Our elite, though obviously not afraid to spend on a grand scale, often affect a "just folks" presentation. So, though Schwarzman has his personal chef prepare him stone crabs that cost $400 apiece for a casual Saturday lunch, he hired the profoundly middlebrow Rod Stewart to croon at his birthday party. And though Schwarzman is usually photographed in a business suit, and occasionally in formalwear, many of his Wall Street colleagues prefer open-necked shirts and khakis as their work clothes. Class conflict was a lot more open, on both sides of the divide, a century ago.