Summary
Highlights
From the end of the Civil War to the early 20th century, the U.S. population grew significantly, the national product tripled, and manufacturing surpassed agriculture for the first time. By 1900, the U.S. was the world's largest manufacturing nation, leading to immense wealth, particularly in iron and steel. This period, from 1870 to 1890, is known as the Gilded Age, a term coined by Mark Twain to suggest a façade of prosperity, hiding underlying social issues like the rich getting richer at the expense of the poor.
The Gilded Age saw the rise of corporations. Unlike small, family-owned businesses, corporations are legal entities that can attract investors without exposing their personal wealth to liability. This limited liability encouraged investment and expansion, leading to the dominance of industries by a few powerful individuals. Without anti-monopoly laws, figures like Andrew Carnegie (steel) and John D. Rockefeller (oil) monopolized their respective markets, amassing unprecedented wealth and power. Rockefeller, through aggressive tactics like undercutting competitors and securing favorable railroad rates, controlled 90% of U.S. oil, making him the richest man in U.S. history at the time. This concentration of wealth sparked concerns about the influence of these powerful men on democracy.
Technological advancements played a crucial role in enabling corporations to expand and monopolize. The Gilded Age brought electric appliances, canned goods, and boxed cereals, simplifying daily life. Key inventions included Alexander Graham Bell's telephone (patented in 1876), which revolutionized communication and efficient business operations, leading to the formation of the Bell Telephone Company (now AT&T). Thomas Edison, though not the inventor of electricity or the first lightbulb, patented the first commercially viable electric lightbulb, leading to the creation of General Electric. These innovations not only improved daily life but also extended working hours and increased corporate efficiency. Research labs became integral to corporations, constantly innovating to maintain market leadership, as seen with U.S. Rubber developing new uses for rubber beyond tires.
The Gilded Age brought two major shifts in the labor force: a transition from skilled to unskilled labor and a rise in immigrant workers. Mechanization reduced the need for skilled labor, leading to lower wages as almost anyone could operate machines. Concurrently, millions of immigrants, particularly from Southern and Eastern Europe, arrived in the U.S., often fleeing persecution or famine. Their willingness to work for lower wages created intense job competition with native-born whites, further driving down wages and fostering nativism. Nativism, a fear of immigrants, led to the creation of a racial hierarchy, justifying discrimination against these new immigrant groups through pseudoscientific claims of biological inferiority, giving native-born whites an advantage in the job market.
Working conditions for the labor force were dismal. Men worked 60 hours a week for extremely low wages (equivalent to $14,000 annually today), while women and children earned even less. These subsistence wages kept workers in poverty, making it impossible to save money and fostering loyalty to employers out of necessity. Animosity grew between different worker populations, as women, racial minorities, and children were often used as 'scabs' to break strikes. Factories were dangerous, with frequent injuries due to untrained workers operating complex machinery, often resulting in job loss as injured workers were deemed 'unfit.' Living conditions in overcrowded urban tenements were equally grim, with poor sanitation leading to widespread illness. While the middle and upper classes enjoyed new luxuries in the suburbs, the working class struggled in unhealthy, cramped quarters, highlighting the extreme disparities of the Gilded Age.
The prevailing ideology that justified these inequalities was Social Darwinism, a concept introduced by Herbert Spencer and popularized in the U.S. by William Graham Sumner. Applying Charles Darwin's 'survival of the fittest' to human society, proponents of Social Darwinism argued that the government should not intervene to help the poor, believing that society would strengthen by allowing the 'weak' to die off. Critics like Lester Ward and Thorstein Veblen argued against this, suggesting that governmental intervention, like a farmer nurturing a crop, could lead to a more prosperous society. Veblen further contended that if only the working class died off, the upper and middle classes would cease to be productive, leading to national regression. Despite these logical criticisms, Social Darwinism remained dominant, largely supported by the wealthy who benefited from it and resisted policies that would increase their responsibilities to the working class.