More About the Gilded Age

More About the Gilded Age

- Industrial growth: railroads, iron, coal, electricity, oil, steel, banks.

§ The benefits from railroad building also had bankruptcies due to overspeculation, resulting in reorganizations and mergers.

§ Significance of the railroads:

· United the nation physically.

· Created a domestic market connecting raw materials w/ markets

· Attracted domestic and foreign investments.

· Added on time zones, which altered the concept of time.

· Stimulated industrial revolution in the US

· Great urbanization – stimulation of immigration, maker of millionaires.

- Significance of iron

§ Minnesota-Lake Superior region yielded some iron ore by the 1850s – contributed to rich deposits of Mesabi Range in the 1890s.

§ Was the “priceless bonanza” as it led to the stimulation of a vast steel empire.

- Significance of coal.

§ Used as fuel in industry

§ Midwest coal mining was often a family business

· Until 1890, English and Irish immigrants dominated the business.

§ Was a dangerous and dirty business

· B/w 1887 and 1894 were 116 major coal strikes in IL alone.

§ Were the first large group of skilled workers drastically affected by influx of immigrants

· Clash between “old” and “new” miners led to violence.

· Would have United Mine Workers’ pressure on Congress to restrict immigration.

- Significance of electricity.

§ Thomas Edison breaks down barriers with inventions.

§ Less well known inventions were the improved telegraph (4 messages in one wire), first modern research laboratory and invented a “telephone repeater” which became the phonograph.

- Significance of Steel

§ Led to heavy industry which concentrated on making “capital goods” as opposed to “consumer goods”.

· Invention of the Bessemer process transformed the industry.

· US would produce as much steel as England and Germany combined by 1900.

§ Was made possible by abundance of coal for fuel, iron ore for smelting and labor.

§ Andrew Carnegie was the “Sultan of Steel” – ¼ of Bessemer steel production in nation.

· Partner was Henry Clay Frick who expanded empire through vertical trust.

· Firm believer in American democracy and laissez-faire economy.

- Significance of oil

§ “black gold” surpasses wealth of gold industry

§ John D. Rockefeller the giant in this industry.

§ By 1877 would control 95% of all oil refineries in US

· Firm believer in Social Darwinism

· “Rule or ruin” was motto.

§ Master of methods incl. Consolidation (trusts) to eliminate “wasteful competition”

- Significance of millionaires

§ The “pirates” of industry had the “new rich” replace the older American aristocracy.

· Displaced aristocrats joined anti-trust campaigns.

§ Rockefeller’s monopoly of oil industry resulted in relatively cheap prices through use of large scale production, distribution methods.

- Significance of Banks

§ JP Morgan “financed capitalism”

§ Through the United States Steel Corporation, financed reorganization of major industries in this area.

- Laissez-faire conservatism

§ Gospel of Wealth added social responsibility to Social Darwinism (a term coined by Rockefeller)

· Had Constitution and courts uphold plutocracy.

· Congressional control over state to state commerce resulting in corporations resisting state efforts at control.

· Interpreted 14^th Amendment’s “due process” of a “person” to include corporations.

· Incorporated industries in states had little or no restrictions.

§ Myth of the “self-made man”

· Idea that anyone can become an Andrew Carnegie if they worked hard.

· Horatio Alger’s stories of boys becoming rich through hard work popular

o Gave poor people the hope they needed.

· Was a myth because most workers had little chance to become successful after consolidation of businesses in this area – limited development of free enterprise.

§ Social Critics and dissenters

· Social Gospel movement and other churches confront issue of monopolists.

· Journalist authors joined in movement.

o Henry George and his Progress and Poverty advocated single tax to prevent unfair accumulation of wealth.

o Edward Bellamy wrote Looking Backward, influential in economic and social injustices of era.

o Theodore Dreiser wrote Sister Carrie, narrative of what happens to poor working girl in Chicago.

· Common for “social novelists” to portray social and econ problems in their work.

- Effects of tech development on workers

§ Short term effect of technological advances was temporary displacement of workers.

§ Transportation system brought immigrants everywhere.

· Immigration would make labor plentiful and cheap, further reducing power of labor force.

- Union Movement

§ Workers powerless as corporations had money and influence in politics and law enforcement.

§ “scabs” (strikebreakers), to “injunctions” to order strikes back to work.

§ “lookout” method to keep workers out until submitted.

§ “yellow dog contracts” or “iron clad oaths” made workers agree not to join unions.

§ “black lists” on workers to prevent them from joining other companies because they were known to have organized unions.

§ “company towns” kept workers dependent on employers as they cashed in checks for food and credit.

- Public saw organization of labor w/ suspicion, thought of as unpatriotic, undemocratic, socialist, foreign.

§ Previously Civil War gives labor unions a boost.

· Laborers more scarce, increasing their worth.

· Rise in cost of living = incentive to unionize.

- The Knights of Labor and American Federaiton of Labor.

§ Lead by Terrence v. Powderly

§ Secret organization – later included all workers.

· 90,000 membership.

§ Worked for 8 hour day and workplace improvements.

§ Supported May Day strikes in 1866 and association with Haymarket Square riot caused it to be associated w/ radicalism, etc.

· Due to not granting special benefits to skilled workers, soon had most members go to other unions by 1890.

- The American Federation of Labor 1866 – skilled workers only.

§ Samuel Gompers led.

§ Self-governing union.

· Against socialism, didn’t oppose capitalism.

§ Conservative approach to winning fair shaie for workers.

· Had “closed shop agreements” which all employees must join union and used “walkout” and boycott methods to win terms.

§ Effective but narrower in scope.

· Was non-political, so less threatening.

§ Was the “labor trust”

· Only 3% of labors unioized.

§ Able to change public attitudes as many concede that workers have the right to organize, bargain collectively, strike, etc.

· Labor Day est. 1894.

- Haymarket, Homstead and Pullman.

§ Haymarket Square Incident 1886

· See Chapter 24 Notes

§ Homestead 1882

· Carnegie’s partner Frick cut employee wages by 20% at the Homestead Steel Plant.

· Involved the PA state militia.

o Plant reopened under military guard and strikers give up.

§ Pullman strike 1894

· Eugene Debs helped organize the American Railway Union (150,000 workers)

· When the Pullman Palace Car Company hard hit by the depression of 1893, wages were cut by a third and rent not lowered.

o Federal troops dispatched and courts issued injunction to cease strikes.

- Led to outrage against Washington that they would use “government injunction” to break strikes.

§ Saw as “proof” that there was alliance between big businesses and the courts.