Industrial Era

Populist Party

alliance of farmers, factory workers, miners, and african americans

The Gilded Age 1870’s-1900

Private business and partnerships still existed HOWEVER, corporations became the dominant form of business and led to the enormous wealth of corporate owners of the era

Why were farmers angry at railroad owners?

• The railroad companies were given the best land by the government

• they charged farms for both storing AND transporting their goods

Why were farmers angry at bank owners?

• they charged farmers extremely higher interest rates then everyone else

The Grange Movement

founded to advance methods of agricultures, as well as to promote the social & economic needs of farmers in the U.S.

What did the Grangers advocated for?

• cooperative purchasing, by a group of farmers, as a means of obtaining lower prices on farm equipment & supplies

• pooling of savings, among farmers, as an alternative to dependence on banks for loans (an early form of credit union)

• cooperative (jointly own.operated) grain elevators to hold non-perishable crops until the optimal times to sell; instead of having to pay R.R. companies to store their products

Oliver Hudson Kelley

formed the National Grange of the Patrons of Husbandry:

• devoted to educational events and social gatherings to spread sound agricultural practices

• later began to advocate for unionship among farmers b/c of poor working conditions

“Grange Laws”

a series of laws that allowed states to regulate the business practices of the R.R. companies (Ex. set maximum rates, establish uniform rates)

1877 Munn V. Illinois

States CAN regulate INTRASTATE Commerce (trade that takes place only within a state’s boundary lines) SO, the states CAN regulate the R.R> companies even though they are private businesses IF it’s in “the best interest of the public good.”

1886 Wabash V. St. Louis R.R. Company

Only CONGRESS can regulate INTERSTATE trade. Since trains conduct trade BETWEEN the states, the IS interstate trade so the states CANNOT regulate the R.R. Companies

The interstate Commerce Act 1887

• established the Interstate Commerce Commision (ICC) as a regulatory agency

• shipping rates had to be reasonable & published in advance

• politicians/business owners could NOT be given special rates

• price discrimination against small towns/markets was made illegal

Corporate Form of Business

• limited impact of financial failures

• corporations have the same rights and activities as “a person” normally would

• less difficulty in attracting investors & raising capital/money

• able to raise additional capital just by selling more shares of stock in their companies to the public → expansion

• complex corporate administration

John D. Rockefeller

oil

Cornelius Vanderbilt

steamboats & R.R. shipping

J.P. Morgan

banking

John Jacob Astor

real estate

Leland Stanford

R.R. construction

Andrew Carnegie

steel

Eliminating Competition Process

1. Drastically lower prices

2. Outsell your competitor

3. Raid the company

4. RAISE prices

The Wealth of Nations (Adam Smith)

• Capitalism > best form of economic system

• The government should:

  • NOT regulate/control businesses

  • let people have private ownership of means to production

Laissez-Faire Capitalism

Government should NOT interfere with business practice

Social Darwinism

businesses/businessmen that were best fit would thrive and those that were unfit would fail. That’s just business!

Working Conditions

• Lower paid employees face pressure and even physical punishments

• Machines weren’t safe so many accidents were fatal/maiming

• Sweatshops were poorly ventilated and lit

• Miners developed “black lungs” after years of working in the mines

• Worked 16+ hours and was barely paid

Knights of Labor

• Founded by: Uriah Stevens

• Open to anyone

• Fought to end child labor & shorten working hours

• favored arbitration & mediation

Arbitration

technique used to resolve disputes between workers and bosses outside the court system. An arbiter listens to both sides and makes a final decision.

Mediation

A neutral person is brought in a dispute between workers and bosses and helps both sides negotiate so that they can come to an agreement.

American Federation of Labor (AFL)

• Founded by Samuel Gompers

• first federations of labor unions organized in the U.S.

• fought to reduce work hours & increase wages

• belonged to specialized/craft workers

• regularly used strikes

The Great Strike of 1877

• Railroad company employees went on strike after their wages were cut again

• The government stepped in because strikers were interfering with interstate commerce

Homestead Strike/Massacre

• steel & iron workers strike as a result of a new contract that would lower their wages and increase in production

Haymarket Affair/Riot of 1886

• 12 hundred people gathered and protested the killing of a striker by the police a day before

• Someone threw a homemade bomb and police opened fired on the crowd, later speakers at the protest were arrested and hanged

• as a result, the public began to turn against labor movements

The Pullman Strike

• when workers were rehired but were given higher wages or decreased rents, they went on strike

• Violence broke out when strikebreakers were hired

• many were jailed, fired and blacklisted afterwards

Monopolies

one company has control over an industry’s production, pricing & wages

Vertical Integration

• purchase of companies at all levels of production

• dominating the supply chain

Horizontal Integration

• purchase of competing companies in same industry

• dominate one industry

Trusts

competing companies merge to form one giants COMBINATION

• goal: eliminate your competition

• pay dividends to investors

• issue stocks