(old)Gilded Age pt 1

Gilded Age (1865-1900)

Period marked by rapid industrial growth, extreme wealth inequality, political corruption, and unregulated capitalism

Adam Smith

Wrote "The Wealth of Nations," believed in capitalism regulated by competition

"All that glitters is not gold" (Mark Twain)

Meaning of the Gilded Age: wealth and success looked impressive but hid corruption and exploitation

Age of the Plutocrat

The wealthy reign over politics and the economy

Era of the Robber Baron

Business leaders gain wealth by taking advantage of workers and consumers

Era of Business Oligarchy

Businesses dominate politics by "buying" off legislators

Era of Conspicuous Consumption

The wealthy spend lavishly to prove their wealth

Laissez-faire Capitalism

Government does not regulate business, with only minor exceptions like the ICC and Sherman Act

Era of Good Stealings

Nickname for Grant's administration due to widespread corruption

Tweed Ring

Political corruption scandal involving New York City government

Credit Mobilier

Scandal involving railroad company bribing government officials

Whiskey Ring

Scandal involving tax evasion by whiskey distillers

Belknap Scandal

Corruption involving bribery in the War Department

Trusts' Goal

Maximize profits and keep government from interfering on behalf of workers

Justification by Businesses for Monopolies

Economies of Scale, Gospel of Wealth, Social Darwinism, Labor Unions, Horatio Algerism

Economies of Scale

Consolidation of businesses increases productivity, allows more capital for R&D, lowers production costs, and lowers consumer prices

Gospel of Wealth

The wealthy are trustees of the nation's wealth and should distribute it through philanthropy

Philanthropy

Wealthy donating money to institutions like libraries (Carnegie)

Social Darwinism

"Survival of the fittest"; the wealthy are wealthy because they are the most intelligent business managers

Labor Unions (business view)

Seen as communistic and socialist and against American individualism

Horatio Algerism

Belief that anyone can move up in society; "rags to riches" stories

Andrew Carnegie

Steel magnate; used vertical integration; author of the Gospel of Wealth

Vertical Integration

Controlling all steps of production

John D. Rockefeller

Founder of Standard Oil; used horizontal integration and cutthroat practices; controlled 95% of oil refining

Horizontal Integration

Buying out competitors to control an industry

J.P. Morgan

Banker who used interlocking directorates; banker's bank; "saves" US in Panic of 1889

Interlocking Directorates

Same people sit on boards of multiple companies to control business decisions

Practices by Trusts to Stop Labor Unions

Conquer and divide, "yellow dog contracts," court injunctions, blacklisting

Conquer and Divide

Trust tactic of hiring different ethnic groups to create conflict and prevent unionization

Yellow Dog Contracts

Employees agree not to join a union

Court Injunctions

Courts issue cease-and-desist orders against strikers; strikers can be jailed (In re Debs)

Blacklisting

Labor agitators' names are shared so they cannot get work in the town

Marxism Vision

There will be a class conflict between the proletariat (working class) and bourgeoisie (wealthy class), and the proletariat will win

Populist Party (1892)

Political party supporting farmers and laborers; wanted bimetallism, government-owned railroads, and government-run "farm banks"

Bimetallism

Use of gold and silver to back currency

Railroad Monopolies

Railroads use unfair practices to maximize profits

Short Hauls

Higher rates for short-distance shipping

Long Hauls

Lower rates for long-distance shipping

Discrimination in Pricing

Railroads charge different customers different prices

Pooling

Railroad companies set prices and schedules and do not compete

Rebates

Large customers receive freight discounts; farmers pay more

Storage Fees

Fee charged to store goods in railroad-owned warehouses

Stockwatering

tricking investors by selling more stock than is claimed in books

Cornelius Vanderbilt

Railroad conglomerate leader

Jay Gould

Railroad conglomerate leader

Munn v. Illinois

States can regulate businesses that affect the public interest

Wabash Case (1886)

Reversed Munn; states cannot regulate interstate railroads

Interstate Commerce Act (1887)

Created the ICC to regulate railroads

Sherman Anti-Trust Act (1890)

result of Pullman strike; "prohibits all combinations in restraint of trade"; first anti-monopoly law; not enforced for 15 years

Labor Unions

Organizations formed to improve wages, hours, and working conditions

National Labor Union

Early national labor organization

Knights of Labor

Led by Terence Powderly; included skilled and unskilled workers

American Federation of Labor (AFL)

Led by Samuel Gompers; only skilled workers; more leverage

Great Railroad Strike (1877)

Federal troops sent by Hayes to end strike

Haymarket Square Riot

Anarchists bombed Chicago; Knights of Labor destroyed

Pullman Strike (1892)

Federal troops sent in; Eugene Debs jailed (In re Debs)

Homestead Strike (1894)

300 armed guards and National Guard sent to put down strikers

Eight Hours for Work, Eight Hours for Rest, Eight Hours for What We Will

Knights of Labor slogan

Mill town

town where company owns homes, factories, and businesses

Sharecropping

System where farmers pay landowners with a share of crops

Tenant Farming

Farmers rent land for cash

Crop-Lien System

Credit system trapping farmers in debt

Booker T. Washington

Advocated vocational training and gradual equality

Tuskegee Institute

School founded by Washington for vocational education

Atlanta Exposition Speech

Argued separation of races was acceptable; Blacks should focus on hard work and economic progress

W.E.B. Du Bois

Advocated immediate equality and higher education

Talented Tenth

Du Bois's belief that the top 10% should lead African American advancement