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share doubled, dramatically increasing inequality. Which led many people starting in the 1840s in America and Europe to imagine that these booming new capitalist systems were unsustainably unfair and might presently bust.
    In Britain, a twenty-four-year-old executive at a cotton mill near Manchester, the son of one of the company’s founders, wrote in an 1845 book that “the most important social issue in England [is] the condition of the working classes, who form the vast majority of the English people. What is to become of these propertyless millions who own nothing and consume today what they earned yesterday?” The “industrialists,” this young industrialist wrote, “grow rich on the misery of the mass of wage earners,” but “prefer to ignore the distress of the workers.”
    The writer was Friedrich Engels, about to become Karl Marx’s lifelong friend, collaborator, and patron. Instead of collapsing, the new capitalist system adapted. America’s has always been a free-market economy, but as a political economy, the society constantly redesigns and tweaks the system and enforces its operating rules and norms. And so from the mid-1800s onward, as new technologies kept making workers more productive—by 1840 the productivity of U.S. factory workers exceeded Britain’s—and as the economy kept growing, workers started getting a proportionately larger share of the enlarging pie, and then they kept doing so. To use the other standard metaphor again, for the next century and a half, all boats rose together.
    That principle of economic fairness was at the heart of our American social contract as we evolved from rough-and-ready start-up nation to successful global superpower. It didn’t happen because the new capitalists of the 1840s suddenly became kind and began sharing their wealth, like Dickens’s Ebenezer Scrooge. *3 Encouraging virtue among the well-off—that is, creating good, strong social norms and shaming violators—does have a place in this story. But the big shift toward economic fairness that began in the later 1800s was the result of a new system of controls that we democratically built into our political economy.
    “Private economic power is held in check by the countervailing power of those who are subject to it,” the supremely lucid economist John Kenneth Galbraith wrote in American Capitalism in 1952. “The first begets the second.” Countervailing power is a political economic concept that Galbraith nailed down. From the late 1800s through the 1900s, that power was organized and built throughout U.S. society by citizens and workers and customers to check and balance the new and rapidly growing power of big business. We almost only talk about “checks and balances” concerning Washington politics, presidents versus Congress versus the federal courts. But economies—especially modern free-market economies, loosely supervised day to day, operating mostly without government commanders-and-controllers—also need systems of checks and balances.
    It can be useful to think of an economy as a game, the highest-stakes game there is. As in D&D or backgammon or Chutes and Ladders, some players are extremely avid and others have better things to do, some players are very skilled and others just…keep tossing the dice. But unlike other games, in the economy everyone is a player. And we all need one another to keep playing forever. Because the whole point is never-ending play, without overwhelmingly decisive, permanent winners or so many losers the game doesn’t work as well as it can and should. All games have rules, but unlike other games, the rules by which an economy operates only seem like they’re handed down by a godlike game designer—whereas in fact, they’re amended and sometimes dramatically rewritten by the players over time.
    Meanwhile, back in real-life American economic history, starting in the 1800s the industrial revolution changed the game, modern corporations formed, and one