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 had
phones;
– Business
typewriters,
cash
(Bell
Telephone
Co
became
AT&T)
registers, 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”
A new-and-improved
revolution”:
The
Midwest Made“market
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 trustees
to of business
oversee & organization
manage other
were
used to increase
manage
a company
subsidiaryprofits:
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
HorizontalMergers
Integration
U. S.&Corporate
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
& bought
rail lines
to profit faced
with
■But,
the railroad
industry
little concern
foroverbuilding
efficient use in
problems
due to
the 1870s & 1880s:
–Mass competition among RRs
–RR lines offered special rates &
rebates (secret discounts) to
lure passengers & freight on
their lines
–Pooling & consolidation failed to
help over-speculation
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
Andrew
Carnegie converted his steel
–Carnegie
was the great
plants
to
the
Bessemer
process
example of the
& was
able to out-produce his
“American
Dream”
& socialcompetition
mobility
& offer lower prices
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
Membership
regardless
of
skill,
race,
or
sex
the “wage system”
The
KoL
lacked
organization
to
survive
Excluded
women,
blacks, unskilled
■The most
successful
union,laborers
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
TheForeign-born
influx of ethnic nationalities
led
to
a
new
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
in university
the Gilded
Age
Women
made
up 40% of
students
■Urbanization
society:
Private
philanthropychanged
led to Stanford,
Tulane,
Vanderbilt,
Cornell,
& the
of Chicago
–The U.S.
saw
an Univ
increase
in
self-sufficient
female
Land
Grant Act (1862)
led workers
to the
Universities
of
WI,
CA,
MN,
IL
“Family
time”states
disappeared
for working class
–Most
had compulsory
education
laws
&
kindergartens
People of all races married later
& public
had fewer
–150 new
& children
private
colleges 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 Politics
than 1% of
popular vote
ofthe
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
Commerce
–Democrats
controlled
the
House
Service Act of 1883
Act of 1887
–Republicans
held
the
Senate
Sherman Antitrust
McKinley Tariff
■This
made
difficult
Act of“stalemate”
1890
Act of it1890
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
Civil Service
Reform
Dept of Agriculture
Treasury
Dept grew from
& Bureau
Indian
4,000 employees
1873
■Theofmost
important
political in
issue
Affairs
were
added
to
25,000
by
1900
of 1880s 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
56,000 bureaucratic jobs were
–Political
filled by machines
patronage inruled
1881 cities
through bribes & personal favors
Boss Tweed
The
of the
NYC
Democratic
“Bosses”
Political
of the
Machine,
Senate
Tammany Hall
Service
“IfCivil
the spoils
systemReform
could kill a
it was time
to end it”a
■Civil president,
service reform
received
boost 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
Tariffs
&
Trusts
by the
federal
gov’t
to
model
for
future
st
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
in as
1887
to it
making
a good is not (ICC)
the same
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)
re DebsPullman
in 1895, the
Supreme
■InIn1894,
Palace
CarCourt
upheld the
injunction
sincewhen
the strike
workers
went
on strike
the
“restrained” U.S. trade
company 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
thea Pullman
Strike:
Thisofwas
clever application
of the Debs
Sherman
Antitrust
Act &
–Eugene
was
arrested
became
committed
socialism
In re Debs
made the to
Sherman
greatsparking
anti-laboratool
whileAct
in ajail,
brief U.S.
socialist movement
–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 &
to inflation
& someone
Greenback
Silver Movements
would consistently buy silver from miners
■Many farmers supported the “free
In 1878, Congress passed the
silver”
movement:
Bland-Allison Act to coin between
$2-4 minted
million insilver
silver&
coins
–The U.S.
gold
coins
at a ratio
of 16:1,
but
In 1890,
Congress
passed
the
Sherman
Silver in
Purchase
stopped
1873 Act
duetoto an
increase
silver
coinage
but
not
to
oversupply
of
gold
16:1 (the act was repealed in 1893)
–But western miners found huge
lodes of silver & wanted “free
silver”—the gov’t should buy all
silver from miners & coin it
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–Their
governors,
10 congressmen,
senators,
platform
included 5the
&
dominated
the statean
governments
of
Ocala
Demands,
8-hour day,
Idaho, NV, CO, KS, & ND
gov’t control of 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
“Having
behind us the producing
masses…we
■A Populist-Democrat
merger
will answer
their
demand
for
the
gold
standard
looked
possible
in
1896
when
‘You shall not press down upon the brow of
William
Jennings
Bryan
received
labor
this crown
of thorns,
you shall
not
crucify
mankind uponnomination
a cross of gold.’”
the Democratic
against Repub William McKinley:
–Called for free silver & income
tax; attacked trusts & 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