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Gilded Age Industrialization

During the Gilded Age, American businesses
were transformed:
◦ Massive corporations replaced small, family
businesses
◦ New technology, transportation, marketing, labor
relations, & efficient mass-production
◦ By 1900, the U.S. was the most industrialized
country in the world
The Business of Invention
 19th-century inventors led to an
“Age of Invention”:
◦ Cyrus
Field’s telegraph cable
By ◦1905,
10 million
Americans
hadregisters,
phones;
Business
typewriters,
cash
(Bell
Telephone
Co
became
AT&T)
adding machines
◦ High-speed textile spindles, auto
looms, sewing machines
◦ George Eastman’s Kodak camera
◦ Alexander G. Bell’s telephone
The Business of Invention
 Thomas
Edison, the “Wizard of
Menlo Park,” created the 1st research
lab in New York
◦ Edison Illuminating Co was the to 1st
use electric light in 1882
◦ Tesla’s alternating current (AC) allowed
electricity to travel over longer
distances & to power streetcars &
factories
The Business of Invention

New technologies allowed for increased
industrial production
◦ New machines were incorporated into the first
assembly lines which allowed for continuous &
faster production of goods
◦ The railroad linked every region of America &
allowed for a mass consumption of goods
Chicago Meatpackers:
The 1st “Disassembly Line”
new-and-improved
“market
revolution”:
TheAMidwest
Made Meat
for America
More regional specialization made
mass
production & mass consumption possible
New Methods of Marketing
 Marketing
became a “science”:
◦ Advertising firms boomed
◦ Department stores like Macy’s &
Marshall Field’s allowed customers to
browse & buy
◦ Chain stores like A&P Grocery &
Woolworth’s “Five & Ten”
◦ Mail-order catalogues, like Montgomery
Ward sold to all parts of America
New Forms of Business Organization
“Trusts” use a board “Holding companies”

New
types
of
business
organization
of trustees to
oversee & manage other
were
used to increase
profits:
manage
a company
subsidiary
companies
◦ “Trusts” & “holding companies”
integrated various businesses under 1
board of directors
◦ Vertical & horizontal integration
maximized corporate profits
◦ Frederick Taylor’s “scientific
management” emphasized time
efficiency & mid-level managers
Vertical U.
& Horizontal
Integration
S. Corporate
Mergers
By 1900, 1% of U.S.
companies controlled
33% of all industry
New Forms of Business Organization
 Business
leaders used a variety of
ideas to justify their wealth:
◦ The “Gospel of Wealth” argued that it
is God's will that some men attained
great wealth
◦ Social Darwinism taught that natural
competition weeds out the weak & the
strong survive
◦ Were monopolists “captains of industry”
or “robber barons”?
The Industrialization
of America
The Second Industrial
Revolution was fueled
by 3 industries:
railroads, steel, & oil
The Railroad Industry

America’s first “big business” was the railroad
industry:
◦ Railroads stimulated the coal, petroleum, &
iron/steel industries
◦ Large companies bought small railroads,
standardized gauges & schedules, & pooled cars
◦ Small lines in the east acted as tributaries to the 4
great trunk lines into the West
Cornelius “the Commodore” Vanderbilt was the
most powerful figure in the railroad industry
Jim Fisk
Problems
of Growth
Speculators
like Jay Gould built

But,&the
railroad
industry
problems
bought
rail
lines tofaced
profit
with due
to overbuilding
in the
& 1880s:
little concern
for1870s
efficient
use
◦ Mass competition among RRs
◦ RR lines offered special rates & rebates (secret
discounts) to lure passengers & freight on their
lines
◦ Pooling & consolidation failed to help overspeculation
Problems of Growth
 RR
bosses asked bank financier J.P.
Morgan to save their industry:
◦ Morgan created a traffic-sharing plan to end
wasteful competition
◦ “Morganization” fixed costs, cut debt,
stabilized rates, issued new stock, & ended
rebates
◦ Created a “board of trustees”
 By
1900, 7 giant (centralized & efficient)
rail systems dominated
The Steel Industry

Steel transformed world industry:
◦ Allowed for taller buildings, longer bridges,
stronger railroad lines, & heavier machinery
◦ Andrew Carnegie’s company made more steel than
England
◦ Carnegie converted his steel plants to the
Bessemer process & was able to out-produce his
competition & offer lower prices
Andrew Carnegie
was the great
example of the
“American Dream”
& social mobility
Thomas Edison: freethinker,
“atheist”
• In an October 2, 1910, interview in the New
York Times Magazine, Edison stated:
• “Nature is what we know. We do not know
the gods of religions. And nature is not kind,
or merciful, or loving. If God made me — the
fabled God of the three qualities of which I
spoke: mercy, kindness, love — He also
made the fish I catch and eat. And where do
His mercy, kindness, and love for that fish
come in? No; nature made us — nature did it
all — not the gods of the religions.”
Rockefeller and Oil
 Petroleum
also changed industry
◦ New industrial machines needed
kerosene for lighting & lubricants
◦ John D. Rockefeller monopolized the oil
industry, lowered oil costs & improved
the quality of oil
◦ By 1879, Standard Oil ruled 90% of all
U.S. oil & sold to Asia, Africa, & South
America
The Industrial Workers
Industrial Workers
 Industrial
work was hard:
◦ Laborers worked long hours & received
low wages but had expensive living
costs
◦ Industrial work was unskilled,
dangerous, & monotonous
◦ Gender, religious, & racial biases led to
different pay scales
 These
conditions led to a small, but
significant union movement
Early American Labor Unions
 In
1868, Knights of Labor formed to
help all type of workers escape the
Membership
regardless
of
skill,
race,
or
sex
“wage system”
The
KoL
lacked
organization
to
survive
Excluded
women,
blacks, unskilled
laborers
 The most
successful
union, the
American Federation of Labor
(1886) led by Samuel Gompers:
◦ Made up only of skilled labor & sought
practical objectives (better pay, hours,
conditions)
◦ Included 1/3 of all U.S. laborers
The U.S. experienced an “era of strikes”
from 1870-1890
The Great RR Strike of 1877
During
The Homestead
the Chicago
Strike
Haymarket
(1892)
Strike (1886),
from
shut
downresulted
railroads
froma
20%
unionists
pay cut
demanded
at one ofWV
anCarnegie’s
8-hr
day;
led
toplants
mob
to CA
& steel
resulted
in
violence & the death ofhundreds
the Knights
of Labor
of deaths
Urbanization:
1870-1900
Gilded Age Urbanization
 From
1870 to 1900, American cities
grew 700% due to new job
opportunities in factories:
◦ European, Latin American, & Asian
immigrants flooded cities
◦ Blacks migrated into the North
◦ Rural farmers moved from the
countryside to cities
The Lure of the City
By 1920, for the 1st time in U.S. history,
more than 50% of the American
population lived in cities
Skyscrapers and Suburbs
 By
the 1880s, steel allowed cities to
build skyscrapers
 The Chicago fire of 1871 allowed for
rebuilding with new designs:
◦ John Root & Louis Sullivan were the
“fathers of modern urban architecture”
◦ New York & other cities used Chicago
as their model
Tenements & Overcrowding
½
of NYC’s buildings were
tenements which housed the poor
working class
◦ “Dumbbell” tenements were popular
but were cramped & plagued by
firetraps
◦ Slums had poor sanitation, polluted
water & air, tuberculosis
◦ Homicide, suicide, & alcoholism rates all
increased in U.S. cities
Jacob Riis’ “How the Other Half Lives”
(1890) exposed the poverty of the urban poor
Strangers in a New Land

From 1880-1920, 23 million immigrants came
looking for jobs:
◦ These “new” immigrants were from eastern &
southern Europe; Catholics & Jews, not Protestant
◦ Kept their language & religion; created ethnic
newspapers, schools, & social associations
◦ Led to a resurgence in Nativism & attempts to limit
immigration
Immigration to the U.S., 1870-1900
The
influx
of
ethnic
nationalities
led
to
a
new
Foreign-born Population, 1890
“melting pot” (“salad bowl”?) national image
Urban Political Machines
 Urban “political
machines” were loose
networks of party precinct captains led
by a “boss”
◦ Tammany Hall was the most famous
machine; Boss Tweed led the corrupt “Tweed
Ring”
◦ Political machines were not all corrupt
(“honest graft”); helped the urban poor &
built public works like the Brooklyn Bridge
Social
Changes
Gilded
Age
Women
made
up 40%in
of the
university
students
 Urbanization
society:
Private
philanthropy changed
led to Stanford,
Tulane,
Vanderbilt,
Cornell,
& the
Univ ofinChicago
◦ The U.S.
saw an
increase
selfsufficient
Land Grantfemale
Act (1862)
workers
led to the
Universities
of
WI,
CA,
MN,
IL
◦
Most
states
had
compulsory
“Family time” disappeared for working class
education
laws
&
kindergartens
People of all races married later
◦ 150 new&public
& private
colleges
had fewer
children
were formed
◦ Cities set aside land for parks &
American workers found time for
vaudeville & baseball
American Industrialization
 Benefits
of rapid industrialization:
The U.S. became the world’s #1
industrial power
◦ Per capita wealth doubled
◦ Improving standard of living
◦
 Human
cost of industrialization:
Exploitation of workers; growing gap
between rich & poor
◦ Rise of giant monopolies
◦
The Politics of the
Gilded Age
No
more than
1% of the popular vote
Politics
of Stalemate
separated the candidates in 3 of 5 elections
 The
5 presidential elections from
1876 to 1892 were the most closely
contested elections ever
 Congress was split as well:
Pendleton
Civil
Interstate
◦ Democrats controlled
the Commerce
House
Service Act of 1883
Act of 1887
◦ Republicans held the Senate
Sherman Antitrust
McKinley Tariff
 This
made
it difficult
Act of“stalemate”
1890
Act of
1890 for
any of the 5 presidents or either
party to pass significant legislation
for 20 years
The Two-Party Stalemate:
1876-1892
Voting Blocs in the Gilded Age
Democratic Bloc
Republican Bloc
Supported by white
southerners, farmers,
immigrants, & the
working poor
Favored white
supremacy &
supported labor
unions
Supported by
Northern whites,
blacks, & nativists
Supported big
business &
favored antiimmigration laws
Service Reform
Dept Civil
of Agriculture
Treasury Dept grew from
& Bureau
Indian
4,000 employees
in 1873
 Theof
most
important
political issue
of
Affairs1880s
were added
to
25,000
by
1900
was civil service reform:
◦ The federal bureaucracy swelled in size
after 1860 & these positions were
appointed via patronage (spoils system)
◦ Congressmen often took bribes or
company stock for their votes
◦ Political machines ruled cities through
56,000&bureaucratic
jobs were
bribes
personal favors
filled by patronage in 1881
Boss Tweed
The
of the NYC
Democratic
“Bosses”
of Political
the
Machine,
Senate
Tammany Hall
Civil“If
Service
Reform
the spoils
system could kill a
it was time
to endait”boost
 Civil president,
service reform
received
when disaffected patronage seeker,
Charles Guiteau, assassinated
President Garfield:
◦ In 1883, Congress created the
Pendleton Act for merit-based exams
for civil service jobs
◦ State & local gov’ts mirrored these
reforms in 1880s & 1890s
Charles Guiteau assassination of Garfield
Gov’t Regulation of Industry
 From
1870 to 1900, 28 state
commissions were created to
regulate industry, especially RRs:
◦ In 1870, Illinois declared RRs to be
public highways; this was upheld by
Munn v. Illinois (1876)
◦ But, was overturned in Wabash v. Illinois
(1886): “only Congress can regulate
interstate trade”
st attempt The ICC became the
ThisU.S.
was v.theE.1C.
Knight
Co
(1895)
was
the
by the
federal
gov’t
to
model
for
future
st
Tariffs
&
Trusts
1
test
of
the
Sherman
Antitrust
Act
regulate big business
regulatory agencies
 Congress
responded
The
Supreme Court
weakenedby
thecreating:
Sherman
Antitrust Act by ruling that this sugar
◦
The
Interstate
Commerce
monopoly do not restrain trade because
Commission
(ICC)
in 1887
to it
making
a good is not
the same
as selling
regulate the railroad industry
◦ The Sherman Antitrust Act in 1890
which made it illegal to restrain
trade (punishable by dissolution of
the company)
The Interstate Commerce Act
The Pullman Strike (1894)
In1894,
re Debs
in 1895,Palace
the Supreme
Court
 In
Pullman
Car workers
upheld
injunction
the strike
went
onthe
strike
when since
the company
“restrained” U.S. trade
cut wages by 50%
◦ American RR Union leader Eugene V.
Debs called for a national railroad strike
◦ President Cleveland issued an injunction
& sent the army to end the strike &
resume rail traffic
◦ Strikers in 27 states resisted U.S. troops
& dozens died
The Pullman Strike (1894)
 Effects
of
the
Pullman
Strike:
This was a clever application
◦ Eugene
Debs
was arrested
& Act
became
of the
Sherman
Antitrust
committed
to socialism
in jail,
In re Debs
made the while
Sherman
sparking
socialisttool
movement
Actaabrief
greatU.S.
anti-labor
◦ In the 1895 case, In re Debs, the
Supreme Court used the Sherman
Antitrust Act to uphold Cleveland’s
injunction since the strike “restrained”
U.S. trade
The Farmers’
Movements & the
Rise of the Populists
Political Organization
 The
Gilded Age saw a rise in political
organization among disaffected
Americans:
◦ Labor unions (like the Knights of Labor
& the AFL) encouraged industrial
workers to vote
◦ Women’s Christian Temperance Union
(WCTU) advocated temperance, race
relations, & the right for women to
vote
The great temperance agitator—Carrie Nation
The Farm Problem
 The
most discontent group during
the Gilded Age were farmers:
◦ Harsh farming conditions
◦ Declining grain & cotton prices
◦ Rising RR rates & mortgages
◦ Government deflation policies
 Farmers
lashed out at banks,
merchants, railroads, & the U.S.
monetary system (gold standard)
This
would lead
inflation
& someone
Greenback
& to
Silver
Movements
would
consistently
buy
silver
from
miners
 Many farmers supported the “free silver”
In 1878, Congress passed the
movement:
Bland-Allison
coin
◦ The U.S.
minted silver &Act
goldto
coins
at abetween
ratio of
$2-4 million
in silver
coins of
16:1, but stopped
in 1873 due
to an oversupply
gold
In 1890, Congress passed the
◦ But western miners found huge lodes of silver &
Sherman
Silver
Purchase
Act
to
wanted “free silver”—the gov’t should buy all silver
increase
fromsilver
minerscoinage
& coin it but not to
16:1 (the act was repealed in 1893)
The Granger Movement

The 1st attempt to organize farmers began
with the Grangers:
◦ Grangers grew angry at the exploitive practices of
Eastern bankers, railroads, & wholesalers
◦ Grangers formed co-op stores, banks, & grain
elevators

The Grange died in the depression of the
1870s, but established the precedent of farmer
organization
The National Farmers’ Alliance
 In
1890, the National Farmers’
Alliance replaced the Grange as the
leading farmers’ group
 In 1890, made Ocala Demands:
◦ Allow farmers to store crops in gov’t
silos when prices are bad
◦ Free-coinage of silver, a federal income
tax, & regulation of RRs
◦ Direct election of U.S. senators
The Populist Party
 In
1890, farmers & factory workers
formed the Populist Party:
3 governors, 10 congressmen, 5 senators,
◦ Their
platform
included
the
Ocala
& dominated the state governments of
Demands,
an NV,
8-hour
gov’t
control of
Idaho,
CO,day,
KS,
& ND
RRs & banks, the breakup of
monopolies, & tighter immigration
restrictions
◦ Populists emerged as a powerful 3rd
party & got numerous state & national
politicians elected
The Election of 1896
 A Populist-Democrat
merger looked
possible
“Having
behind us the producing
masses…we
in 1896their
whendemand
William Jennings
Bryanstandard
received
will answer
for the gold
‘Youthe
shall
not pressnomination
down upon
the brow
Democratic
against
Repubof
labor
this McKinley:
crown of thorns, you shall not
William
crucify
mankind
upon
a crosstax;ofattacked
gold.’”trusts
◦ Called
for free silver
& income
& injunctions
◦ Bryan visited 26 states on his whistle-stop
campaign to educate Americans about silver
Bryan: The Farmers’ Friend
OR?
18,000 miles of campaign “whistle stops”
The Election of 1896
 Advised
by RNC chairman, Mark
Hanna, McKinley waged a “front
porch” campaign from Ohio
 Aided by the press, McKinley’s
message reached as many voters:
◦ Advocated economic, urban, & industrial
growth
◦ Aroused fear that a “free silver” victory
would result in 57¢ dollar
The election of 1896 killed the Populist Party,
but
key
Populist
ideas
(income
tax,
The
Election
of
1896
secret ballot, & direct election of Senators)
would be enacted by other parties
The McKinley
Administration
The McKinley Administration
 Republicans
benefited from an
improving economy, better crop
production, & discoveries of gold:
◦ The election of 1896 cemented
Republican rule for 30 years & became
the party of prosperity
◦ From 1860-1890, Republicans had
promoted industry; by 1900, it was time
to regulate it
The McKinley Administration
 McKinley was an activist
president and became the first
“modern” president:
◦ He communicated well with the
press
◦ The Spanish-American War brought
the USA respect as a world power
◦ The Gold Standard Act (1900)
ended the silver controversy
A Decade of Changes: The 1890s
The Depression of 1893 and the problems
faced by farmers & industrial workers forced
people to rethink industry, urbanization, & the
quality of American life
 Many embraced the need for reform which
opened the door to the Progressive Era
