QUESTIONS:
What role did the presidents play in this era?
Why is this era “gilded” and with what?
Who benefitted from this era? Who lost?
The Gilded Age
Ch. 17 (p. 519-537)
I. A New Age
________________________-period when corruption existed in society but was overshadowed by the wealth of
the period
o “gilded” is when something is golden/beautiful on the surface but is really cheap/worthless underneath
• Term comes from a book written about the time period by ________________________in 1873: The
Gilded Age
– Explored political and economic corruption in the United States
– The central characters were tied together in a government _________________ bribery scheme
– Depicted an American society that, despite its appearance of promise and prosperity, was riddled
with ____________________________________
Economic Development in the U.S.
WEST
EAST
SOUTH
II. Second Industrial Revolution (______________________)
Marked by enormous growth and ________________________ of wealth and ownership
Major Industries
The Industrialists or Robber Barons
Inventors/Inventions
Socialism v. Capitalism—how should the new economy function?
• What is the role of government?
• What role should the central government play in the economic development of the country?
• How could government stop a Great Depression?
III. Presidents of the Gilded Age
U.S. Grant
Chester A. Arthur
Benjamin Harrison
1869-1877
1877-1881
1881
1881-1885
1885-1889 and 1893-1897
1889-1893
1897-1901
Scandals of the Grant Administration—The “Era of Good Stealings”
During Grant’s terms as president, material interests (money, industry) became more important than the
ideology and civil rights of Lincoln’s time
The Gilded Age was enabled partly because most presidents during this era, including Grant, were __________
in relation to _______________and ______________________________________.
• The U.S. government’s economic policy was relaxed during these years, allowing Americans to take
advantage of the laissez-faire economics in increased speculation, investment, and corruption.
1. Jay Gould and James Fisk: The ________________________ (1869)
• During the Civil War, Congress had authorized the Treasury to issue ___________________ banknotes
to pay huge ____________________
• Unlike the rest of the currency, greenbacks not backed by gold or silver (_____________________)
– Caused _________________ and forced gold-backed money out of circulation
– Public Credit Act (1869) guaranteed that bondholders would be repaid in gold, not greenbacks
• To strengthen the dollar, Treasury Secretary started selling Treasury gold each month and
bought back high-interest greenbacks
– Reduced ______________, deflated ______________
• One group of speculators, “the Gold Ring”, Jay Gould, a Wall Street trader and railroad magnate, and
his partner Jim Fisk, recruited Grant’s brother-in-law to get Grant to appoint a new assistant Treasurer
of the United States, who agreed to tip the men off when the government intended to sell gold.
• Tried to convince Grant and the Treasury that high _____________________ would make the
nation ______________________
• Gould and Fisk began to quietly stockpile gold as they hoped to sell the gold at high prices
• Gould began buying large amounts of gold, but ________________________, causing prices to rise and
stocks to ________________
– Gould and Fisk started hoarding gold, driving the price higher: _________ more than ________
• After Grant realized what had happened, Treasury ____________________________________ in gold
• When government’s gold hit the market, its worth plummeted within minutes
• Investors scrambled to sell their holdings, and many of them __________________. This day was
known as ______________________________.
• Economy resumed its post-war recovery (until 1873)
2. ________________________________ (1872)
• Involved the Union Pacific Railroad and the fraudulent Crédit Mobilier of America construction
company, which was to build the eastern portion of the First Transcontinental Railroad
• created by Thomas C. Durant, a vice president of the Union Pacific Railroad, was a deliberate
attempt to __________________ the U.S. Government and public of millions of dollars.
• In 1868, a Congressman involved in CM sold shares of stock in Crédit Mobilier to other
congressmen, in addition to making cash bribes, to keep quiet about the illegal business
• Essentially, the government paid the fraudsters to build nothing
• The muckraking paper The Sun exposed the scandal during the 1872 presidential campaign
3. ____________________________
• Grant signed the _____________________ (1873), making ___________ the only money standard:
dollars would be exchanged on demand for only __________.
– End of 1873: NY stock brokerage house fails to fully sell a bond on its own purchases in
Northern Pacific Railway, and collapsed
• Collapse panicked _____________________: other banks and brokerages with railroad stocks and
bonds also collapsed
– 89 of the 364 U.S. railroads went bankrupt
– New York Stock Exchange suspends trade 10 days
• Grant, traveled to NY to consult leading businessmen and bankers for advice on how to curb this panic
• Grant believed that, as with the Gold Ring’s collapse, the panic was just economic flux affecting
only bankers and stockbrokers
• Response: Treasury bought $10 mill. in government bonds, injecting cash into economy
• Purchases stopped Wall Street panic, but a five-year industrial depression started
(_____________________________________)
• To help the economy, Congress passed an inflationary policy called the
_____________________________ (1874).
– _____________________________ favored addition of $64 million in greenbacks to circulation
– ________________ bankers opposed; would _____________ the dollar
• Grant unexpectedly vetoed the bill because he thought it would destroy the nation’s credit
– Veto was the beginning of the __________________ Party's belief in gold-backed dollar
4. ___________________________ (1875)
• Employees in President Ulysses S. Grant’s administration were accused of pocketing
____________________ taxes, with the help of the __________________________________
• Grant immediately called for swift punishment; backfired on him when he tried to protect his
personal secretary, with whom he allegedly had an affair, causing an even bigger scandal.
IV. Compromise of 1877
• The Compromise of 1877 was an informal, unwritten deal that settled the intensely disputed
________________________________________________________, pulled federal troops out of state
politics in the South, and ended the Reconstruction Era.
• Through the Compromise, Republican ____________________________ was awarded the White
House over Democrat ________________________________.
• Democrats complained Tilden had been cheated (also called the “Corrupt Bargain II”)
• The compromise said Southern Democrats would acknowledge Hayes as president, but only if
Republicans would meet points of the compromise:
– Removal of all remaining _______________________________ from former Confederate States
– Appointment of at least one Southern _____________________ to Hayes's cabinet
– The construction of another transcontinental railroad using the Texas and Pacific in the South
• part of the "__________________," started the process that led to the final compromise
– Legislation to help _________________________ the South and improve economy
• Outgoing president, Republican Ulysses S. Grant, removed the soldiers from Florida. As president,
Hayes removed the remaining troops in South Carolina and Louisiana. As soon as the troops left, many
white Republicans also left and the "Redeemer" Democrats took control. African American historians
sometimes call it "The Great Betrayal."
V. Rise of the “_________________________”
• In the early 1870s, leadership of the Republican Party (mostly in the North) passed from reformers of
the antebellum/CW era, Thaddeus Stevens (13th Amendment, “radical”) and Charles Sumner
• To political manipulators under the influence of state party bosses: _________________________(NY)
and _____________________ (ME)
• These “spoilsmen” were deeply involved in _______________________, or giving jobs and gov’t
favors (spoils) to their supporters.
• This would end with the assassination of _____________________ by disappointed office seeker denied
a position in the spoils system government
• Patronage or ____________________________- giving government jobs to loyal party workers or
friends (popularized by ___________________________)
– Used position to get money from government (________________)
VI. Republicans Split
Roscoe Conkling was also the leader of the Republican faction known as the “_________________”
• stalwart—someone/something who is _______________ or ________________
• Believed and furthered the idea of the patronage system and continued to believe that sectional appeals
(“waving the bloody shirt”) were still valid even after gradual end of Reconstruction in the South
James G. Blaine of Maine led the Republican faction known as “_______________________”
– Nickname came from willingness to depart from Stalwart orthodoxy
• Many, including President Hayes, believed the patronage system contributed to the scandals and graft
during Grant’s presidency
• ____________________________________ became a popular cause among the Half Breeds
_________________________________ 1883
• Attempted to end patronage/spoils System
• Created the _________________________________________ which required appointed govt. officials
to pass the Civil Service Exam to base jobs on ____________ (qualifications) instead of friendship
• Federal employees did not have to contribute to campaign funds and could not be fired for political
reasons
• President _________________________________ signed Pendleton Act into effect
VII. “Big Business”
• _________________________ : Companies that controlled the majority of one industry:
– Rockefeller’s Standard Oil
– Carnegie’s U.S. Steel
– Vanderbilt’s railroads
• ______________-A group of separate companies placed under the control of a single managing board
• Critics called these practices unfair and the business leaders “____________________________”
Rationalizing Big Business
Social Darwinism--used Darwin’s theory to explain business, promoted by Harvard professor
_________________________________________________
– Natural Selection, Survival of the Fittest
– ________________________ -policy that US had followed since inception to not allow govt. to
interfere with business
____________________________ of 1890: law outlawing a combination of companies that restrained
interstate trade or commerce; important to prevent monopolies. Not initially enforced properly.
__________________________________ -belief that the wealthy are “chosen by God” to be successful and
were therefore responsible to look out for the well being of those less fortunate. (started by Andrew Carnegie)
o Many Industrialists shared wealth although rarely through direct welfare.
o ________________________________: a positive idea that industrial leaders worked hard and deserved
their wealth
_______________________________
• A Scottish immigrant, Andrew Carnegie helped build the American steel industry—Carnegie Steel Co.
(originally started as an ironworks foundry)
• 1900 Carnegie Steel produced more of the metal than all of Great Britain
– Richest man in the world at the time
• One of the first _________________________, gave his
collected fortune away to cultural, educational and
scientific institutions for "the improvement of mankind."
(Gospel of Wealth)
– Carnegie Hall, NYC
– Carnegie-Mellon University
– Over 2,500 public libraries
– $350 million by the time he
Carnegie was unusual because he preached for the rights of
laborers to unionize and to protect their jobs.
• However, Carnegie's steel workers were often pushed to
long hours and low wages-- ______________________
Strike of 1892
Building a monopoly (as described by Andrew Carnegie)
• ____________________________: process in which a company buys out all of the suppliers. (Ex. coal
and iron mines, ore freighters, RR lines)
• ____________________________: process in which a company buys out or merges with all competing
companies (JP Morgan bought out Carnegie steel and other companies)
The Steel Industry’s Impact on America
• ______________________: developed around 1850 injected air into molten iron to remove impurities
and make steel-a lighter, more flexible, rust resistant metal
• Steel is used in railroads, farm equipment, canned goods
• Engineers use steel to create skyscrapers and longer bridges (___________________________)
__________________________
• Industrialist and financier who started U.S. Steel from Carnegie Steel and other companies
• Became 1st billion- dollar corporation
• Bailed out the U.S. economy on more than one occasion
__________________________
• He was a co-founder of the ___________________________________, which dominated the oil
industry and was the first great U.S. business trust
– As kerosene and gasoline grew in importance, became the world's richest man and the first
American worth more than a _______________________________; cited as the richest person
in history
• Like Carnegie, was a philanthropist under the Gospel of Wealth:
– An abolitionist, Creator of Spelman College, donator to the University of Chicago and other
major medical universities
– Owned a large portion of real estate in Manhattan, NYC
________________ (“The Commodore”) and W.H. ____________________
• Originally a steamboat entrepreneur, C. Vanderbilt became a ____________________________
• Initially did not think his son was fit for the job
– W.H. became president of Central and Hudson River Railroad, Lake Shore and Michigan
Southern Railway, the Canada Southern Railway, and the Michigan Central Railroad
• An active philanthropist, giving extensively to a number of philanthropic causes:
– Funded the Metropolitan Opera
– Funded College of Physicians and Surgeons at Columbia University.
– In 1880, he provided the money for Vanderbilt University in Nashville, Tennessee
__________________________(“The Wizard of Menlo Park”)
• An American inventor and businessman. He developed many devices that greatly influenced life around
the world, including:
– Phonograph
– motion picture camera
– Long-lasting electric light bulb (successfully marketed to J.P. Morgan)
• One of the first to apply the _______________________________ and large-scale teamwork to the
process of invention
– Created the first industrial __________________________
– Later electrical genius ______________________ worked for Edison and is (unofficially)
credited with many of his inventions
– 1,093 US patents in his name
• Inventions established major new industries world-wide:
– Electric light/power, power utilities, sound recording, motion pictures
– Telecommunications: stock ticker, mechanical vote recorder, battery for an electric car, recorded
music device