Notes: The Rise of Big Business

Antebellum Foundations

• Antebellum: Latin meaning “before the war” (i.e. before the Civil War).
• The Rise of Big Business draws on economic growth that existed prior to the Civil War; growth in all sectors of the economy as a foundation for later industrial consolidation.

The Rise of Big Business: Key Figures and Concepts

• Andrew Carnegie
  • Steel industry leader; Bessemer Process contributed to steel production efficiency.
  • Associated with the idea of philanthropy and the Gospel of Wealth (1889).
  • Innovation and scale helped build a dominant steel empire.
• John D. Rockefeller
  • Dominance of Standard Oil Company: control at a level such as $90\%$ dominance in oil refining.
  • Innovation in business practices and vertical integration.
  • Philanthropy and the public image of wealth (philanthropy as response to wealth concentration).
• J. P. Morgan
  • Born into wealth; investment banker who consolidated the steel industry and helped create U.S. Steel.
  • Part of a broader pattern of supercorporations shaping the U.S. economy.
• Core ideas across these figures
  • Rapid industrialization, integration of production and distribution, and financial consolidation.
  • Emergence of the ‘old’ rich who wielded influence across multiple industries.

Wealth Concentration and Living Standards

• Gaps in Wealth (1890):
  • The bulk of wealth concentrated in less than $10\%$ of the U.S. population.
  • The top $10\%$ owned $\frac{3}{4}{ }$ of the nation’s wealth.
  • Despite wealth concentration, the rising standard of living benefited the middle class as the new economic order expanded.
• Living conditions for many workers remained hard despite overall gains; urbanization and factory work persisted.

Visual and Social Context of Work

• Depictions of workers and living conditions in late 19th century:
  • Mill girls, young boys at work, and tenements in Brooklyn, NY illustrate urban industrial life and crowded urban housing.
• The human toll of rapid industrialization contrasted with philanthropy and corporate growth.

Backlash Against Big Business and Early Unions

• Unions emerged as a primary means for workers to improve conditions.
• Challenges to organizing:
  • Unskilled or semi-skilled workers faced high risk since jobs could be readily filled by immigrants.
  • Multilingual immigrant communities faced language barriers.
• Civic leaders often sided with property owners and business leaders in disputes over labor conditions.

Great Railroad Strike of 1877

• A significant early national labor conflict reflecting wage cuts and protest against industrial conditions.
• Date: $1877$.

Anti-Chinese Discrimination and Immigration Policy

• Primary public rhetoric and actions against Chinese labor:
  • Political cartoons and speeches portraying Chinese workers as threats to American workers.
  • Notable quotes and slogans from the period reflect anti-immigrant sentiment.
  • Example primary sources include lines such as:
  • "Can this be? We are ruined by Chinese labor." (Tramp Nye)
  • "Which is why I remark, And my language is plain, That for ways that are dark And tricks that are vain, The heathen Chinee is peculiar, Which the same I am free to maintain." (Truthful James, G. Blaine)
• Legislative outcome:
  • The continued growth of organized labor and immigration contributed to the push for restrictive immigration policies.

New Movements Growing Out of the Strike

• Workingmen’s Party of California – Denis Kearney: violence against Chinese workers associated with the period.
• 1882: Congress votes to stop Chinese immigration for 10 years.
• Other foundations:
  • Continued growth of organized labor in the late 19th century—built on foundations created by organized labor before the Civil War.
  • National Labor Union (1866): social and political reforms.
  • Contract Labor Act of 1864: aimed to limit competition from immigrant labor.

Knights of Labor (Late 1800s)

• Inclusive goals:
  • All wage earners eligible for membership (except lawyers, doctors, bankers, and liquor sellers).
• Demands and tactics:
  • Creation of bureaus of labor statistics to monitor salaries.
  • Limit competition from convict labor.
  • 8-hour workday; equal pay for men and women (progressive for the time).
  • Advocacy for paper money to ease debt repayment.
  • Preferential use of boycotts to strikes.
• Membership trajectory:
  • Peak around $1886$ with about $700{,}000$ members; declined after the failure of the Great Railroad Strike.

Unionism and the Taint of Anarchism

• Anarchism contributed to radicalization of organized labor and public fears about worker intent.
• Anarchists believed governments were tools of the rich to oppress the poor; many European anarchists immigrated to the U.S. during this period.
• Violent tensions between labor and management increased; anarchism appealed to some within the labor movement.

Haymarket Affair and the Knights of Labor

• Haymarket bombing and the Knights of Labor involvement tainted the union movement.
• Federal Bureau of Labor Statistics (1884) and Foran Act (1885) emerged in response to labor unrest.
• Goals achieved by the Knights of Labor included broad reforms but ultimately faced a decline after public associations with violence.

Other Major Unions: AFL (American Federation of Labor), 1886

• AFL characteristics:
  • Union for skilled workers only; formed by 25 craft unions; federation of national organizations with some autonomy.
  • Leader: Samuel Gompers (president).
  • Strategy focused on immediate gains: higher wages, shorter hours, better conditions.
• Growth and influence:
  • By 1928, the AFL had about $4{,}000{,}000$ members.
• Distinction from Knights of Labor:
  • Focus on craft-specific, skilled labor and incremental gains rather than broad inclusivity.

Major Setbacks for Labor in the 1890s

• Homestead Strike, 1892
  • Key players: Amalgamated Association of Iron and Steel Workers; Andrew Carnegie; Henry Clay Frick; Pinkerton Detective Agency; Alexander Berkman (assailant of Frick).
  • Outcome reflected the power of management and the vulnerability of unions in certain industrial sectors.
• Pullman Strike, 1894
  • Strike paralyzed economies of $27$ states and territories; centered in Pullman, Illinois.
  • Pullman Place Car Company; American Railway Union and Debs; role of strikebreakers ("scabs"); mail delivery as a justification for federal intervention.
  • Leaders involved: Eugene Debs; George Pullman.

Visual Depictions of Trusts and Corporate Power

• Cartoons and public imagery portrayed trusts as the real bosses of the Senate and as monopolists influencing policy.

The Pullman Strike in Detail

• The strike underscores conflicts over wages, rents, and corporate control in the late 19th century.
• Public opinion and government intervention shaped the outcome of strikes and the regulatory environment.

Radical Political Ideologies and Labor

• Marxism and socialism in the U.S. discourse:
  • Karl Marx and Marxism influenced radical thought about capitalism and labor.
  • Socialist Labor Party (organized in 1877 in the U.S.).
  • Daniel de Leon and his socialist newspaper.
  • Debs and the Social Democrats (socialist organizations and advocacy).
• IWW (Industrial Workers of the World) – the Wobblies
  • Advocacy for industrial unionism and syndicalism; goal of replacing government with one big union.
  • Internal fragmentation among leaders (William Haywood, De Leon, Debs).
  • WWI context: anti-war sentiment, opposition from the IWW, and eventual dissolution under pressure.
• The IWW's association with radicalism and anarchism during this period and their eventual suppression during wartime.

Connections to Foundational Principles and Real-World Relevance

• The era illustrates core tensions between industrial growth and workers’ rights.
• The concentration of wealth and corporate power prompted ongoing debates about regulation, antitrust policy, and social responsibility (philanthropy vs. exploitation).
• The labor movement, including unions like the Knights of Labor and the AFL, sought to secure wage gains, reasonable working hours, and safer conditions, while facing violent backlash and political challenges.
• Immigration policy and xenophobia intersected with labor organization and economic competition.
• Ideological debates (Marxism, socialism, syndicalism) influenced labor strategies and public policy debates about workers’ rights and the role of government in the economy.

Key Dates and Figures (Summary)

• $1877$: Great Railroad Strike.
• $1882$: Chinese immigration restrictions discussed; expansion of labor organizations.
• $1886$: AFL formed; Knights of Labor peak around this time.
• $1889$: Gospel of Wealth proposed by Carnegie.
• $1884$: Federal Bureau of Labor Statistics established.
• $1885$: Foran Act passed (anti-Chinese immigration enforcement).
• $1892$: Homestead Strike.
• $1894$: Pullman Strike.
• $1897$: Bradley Martin Ball (illustrative of era imagery).
• $1899$: Period of intensified industrial consolidation and ongoing labor conflict.
• Phases of wealth concentration and middle-class expansion continued into the early 20th century.

Summary of Ethical, Philosophical, and Practical Implications

• Ethical tension between wealth accumulation and workers’ rights; philanthropy vs systemic inequality.
• The debate over the proper role of government in regulating monopolies and protecting workers.
• The tension between national security (labor stability) and civil liberties in the context of strikes and anti-immigrant sentiment.
• Philosophical debates about workers’ dignity, the legitimacy of unions, and the legitimacy of state intervention in economic life.