OUR FLATTENED GILDED AGE

Two seemingly unrelated articles caught my attention this morning: the first on our new gilded age, and the second concerning the latest democratic fashion of web hanging.

Martin Wolf, the Financial Time's excellent global economics columnist, writes (subscription required) about our new gilded age in this morning's newspaper. Wolf's message is that economic inequality in America is growing dramatically:

"The distribution of US earnings has become significantly more unequal over the past four decades: the share of the top decile has gone from 27% in 1966 to 38% in 2001; that of the top 1% has risen from 6% to 12%; and that of the top 0.1% has jumped from 1% to 5%."

The last statistic is particularly striking. 5% of total US total pay are earnt by the top 0.1% of the workforce -- that's a five fold increase since 1966. And what it all means is that America is increasingly dominated by a tiny and increasingly powerful wealthy class. As Wolf notes, we are back in the plutocratic 19th century, a "new gilded age."

Having digested Wolf's reflections on the increasingly steep hierachy of wealth and poverty in America, I turned to the cheerleader of our gilded age -- The Wall Street Journal -- to read about online democratic communities. In his "Portals" column, the Silicon Valley based Lee Gomes writes about the economic boom (and, no doubt, bubble) of social-networking sites -- MySpace, Friendster, Tagworld and Varsityworld. And if that wasn't enough, the Journal also had pieces about both Microsoft (called, believe it or not, Wallop) and the BBC's plans to develop a MySpace clone of their own.

The Journal quoted Mark Thompson, BBC Director-General, who said, in justifying his new social networking initiative: "there's a big shock coming. The foundations of traditional media will be swept away, taking us beyond broadcasting."

Implicit, of course, in Thompson's remarks is the radical notion of the democratization of media. Social-networking sites are all perfectly flat. Members of MySpace or VarsityWorld are equal in their access to technology and their means of creating media. Equally significantly, the crisis of mainstream media, which lies behind the popularity of online social-networking communities, is the crisis of the intellectual authority of elites. So the cultural foundations of today's social-networking sites is of a radical egalitarianism.

So what's the connection, if at all, between our new gilded economic age and the flattened cultural democracy of the social-networking scene?  How is it that, on the one hand, we are so economically unequal and, on the other, so culturally equal? Is contemporary America defined by MySpace or by the rising price of New York City penthouses?