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 14th 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.
