Conditions did get worse in the industrial revolution. People didn't go to the city because they thought it was brilliant, they went to the city because their livelihood in the rural economy was disrupted. They were pushed (shoved), not pulled.

> the decades after the second world war were probably the nadir

People compare themselves to their parents and grandparents, you can only hustle so far in the face of lived experience.

> You seem to say that a relative capital scarcity is good for labour ('incinerated most of its capital') but also that relative labour scarcity is good for labour? Which way is it?

In an extreme downturn (Europe bombing its cities), the poor undergo more real suffering but the rich undergo more nominal suffering so inequality is reset. Bombed out factories and apartments create an enormous demand for labor -- the broken window fallacy is only a fallacy if you studiously ignore distribution. This is why we should eagerly seek to fix r>g in peacetime -- it's guaranteed to be mathematically possible and it's clearly better for everyone.