Capital and Labor 16 Notes PDF

**Capital and Labor** - American History II: Chapter 16 The Gilded Age -- 1865-1900 The phrase was coined by Mark Twain - a period of growth, technology, and wealth - a growing income divide between the classes I. The growth of labor unions A. [The Great Railroad Strike of 1877] 1\. [R...

**Capital and Labor** - American History II: Chapter 16 The Gilded Age -- 1865-1900 The phrase was coined by Mark Twain - a period of growth, technology, and wealth - a growing income divide between the classes I. The growth of labor unions A. [The Great Railroad Strike of 1877] 1\. [Rail line workers wages slashed while profits increased] 2\. [Workers' strike shut down rail line traffic across the country] 3\. State militias were sent to stop the strikes resulting in violence with 20 strikers killed in Pittsburgh and the city was set on fire. 4\. Federal troops were sent to defeat strikes B. The strike galvanized the country [1. Workers - the need for institutionalized unions ] [2. businesses - the need for: ] - [a greater political influence] - [government aid ] II\. The March of Capital A. The worker 1\. powerless as skills mattered less against powerful companies 2\. Laborers a\. long hours b\. dangerous working conditions c\. Low wages that could not support families d\. health hazards - black lung disease from breathing coal dust B. Industry 1\. Technological innovations cut the cost of production 2\. [Scientific management - Taylorism] a\. more efficiency b\. subdividing tasks c\. interchangeable parts d\. interchangeable workers sped the production process 3\. Mass production increased- Duke cigarettes, Singer sewing machines, Mc Cormick reapers 4\. The U.S. became the world leader in manufacturing by 1900 5\. Bigger profits resulted from bigger production C. [The Corporation] 1\. [vast amounts of capital with liability limited for shareholders] 2\. Eliminated competition through pools, trusts, mergers, price price-fixing agreements with some firms dominating the market - DuPont, General Electric 3\. [U.S. Steel ] [a. J.P. Morgan ] [b. the world's first billion-dollar corporation] built from 8 steel companies he purchased [c. Monopoly -- complete control over the market] III\. The Rise of Inequality A. [Industrial capitalism created tremendous inequity in society] 1\. Extreme wealth of the industrial titans 2\. Urban and rural poor lived in squalid conditions in some cases with workers receiving low wages - \$10 per week B. Industrial Titans/the Robber Barons [1. Cornelius Vanderbilt -- railroads] [2. John D. Rockefeller -- oil] [3. Andrew Carnegie -- steel ] [4. J.P. Morgan -- banking and finance] 5\. Their fortunes were among the largest in American history when adjusted to inflation - The richest 1% owned 25% of the nation's assets - The richest 10% owned 70% of the nation's assets - 1900 The richest 10% owned 90% of the nation's wealth C. Social Darwinism 1\. [Herbert Spencer -- "survival of the fittest"] 2\. [H.L. Mencken- wrote *Synthetic Philosophy* - all creatures subject to a relentless struggle for survival- inequality should be tolerated] - *The Bosses of the Senate* Source: *Ottmann, J. Puck. 1889. Print* D. Politics 1\. Businesses achieved political protection through the federal government 2\. [The Republican Party -- supported of American business] a\. land grants to railroads b\. high protective tariffs shielded businesses from foreign competition IV\. The Labor Movement -- Why? A. American workers 1\. placed in unskilled positions due to mechanization and mass production 2\. worked 60 hours per week, unemployed one month per year, low wages 3\. women and children forced into the labor markets B. [Strikes -- refusal to work] 1\. [Workers wanted higher wages, safer working conditions and shorter hours] 2\. Organization of workers was fleeting C. [Knights of Labor] 1\. [sought to unite skilled and unskilled workers] through local unions 2\. Strikes against Jay Gould's rail lines 3\. National strike May 1, 1886 4\. [Haymarket Square bombing and riot in Chicago caused the power of the union to erode] - **The Haymarket Strike** D. [The American Federation of Labor] 1\. Wanted higher wages, fewer hours and safer conditions with [a conservative approach] 2\. [Homestead Strike (1892) at the Carnegie Steel mills- ] [Manager -] Henry Frick called in the Pinkerton detectives, but the steelworkers fought back 3\. The Pennsylvania state militia, called by the governor, broke the strike and mill reopened- the union was destroyed E. [The Pullman Strike] 1. The Pullman company cut wages by 25%, but kept utilities and rent high in the company town. Result: the workers went on strike 2.The American Railway Union launched a sympathy strike and refused to handle any Pullman cars all over the country. 3\. [National railroad traffic cut to a halt] 4\. Federal reaction: [Pres. Cleveland sent soldiers to break the strike] and the federal court issued a preemptive injunction against union leadership Eugene Debs, a labor leader, was imprisoned which further radicalized him. V. The Populist Movement A. Farmers hit hard by industrialization 1\. mechanization decreased commodity prices 2\. Farmers fell into debt and many lost their land as banks foreclosed. 3\. Farmers were subjected to a national economic system that included rapid price swings, speculation, and regulation. 4\. They needed a political voice for their needs to be met. B. [The Farmers' Alliance 1877] 1\. Texas farmers formed the first to restore economic power to farmers dealing with merchants, bankers, and railroads 2\. [They formed cooperatives] that shared machinery, negotiated prices, and bargained with wholesalers 3.The alliances spread throughout the country with pamphlets and newspapers. C. [The Populist Party] 1\. Pointed out deep flaws in a\. the political economy b\. class inequalities 2\. fought for reform 3\. The Omaha Platform [a. create a stronger federal government that would work in the best interests of the people] b\. platforms - [graduated income tax,] - [coinage of silver - bimetallism] - [secret ballot elections] - postal savings banks to protect depositors and extend credit - government ownership of rail lines - federal warehouses for crops - Mary Elizabeth Lease: The Money Question (1892) - [Wall Street owns the country. It is no longer a government of the people, by the people, and for the people, but a government of Wall Street, by Wall Street, and for Wall Street. The great common people of this country are slaves, and monopoly is the master. The West and South are bound and prostrate before the manufacturing East. Money rules... The parties lie to us and the political speakers mislead us.] We were told two years ago to go to work and raise a big crop, that was all we needed. We went to work and plowed and planted; the rains fell, the sun shone, nature smiled, and we raised the big crop that they told us to; and what came of it? Eight-cent corn, ten-cent oats, two-cent beef, and no price at all for butter and eggs that\'s what came of it. Then the politicians said we suffered from overproduction. 4\. [Challenges in the South ] [racial division and mistrust ] 5\. Colored Farmers' Alliance formed as they were not allowed to join the Farmer's Alliance in order to have their interests met. Cotton pickers who were sharecroppers went on strike for fair wages, violently repressed. 6\. Populists were at the forefront of racial segregation and disenfranchisement keeping with racism at the time -- Thomas Watson of Georgia 7\. They race-baited Democrats to join their cause against Republicans who had African Americans as a part of their political party. VI\. William Jennings Bryan A. Born to a devout family and had a passion for law, public speaking and politics B. Worked for the Democratic Party with his [oratory skills ] C. [Called for bimetallism-- free coinage of silver that he felt could alleviate farmers' debts ] He gave his famous "Cross of Gold" Speech "You shall not crucify mankind upon a cross of gold." D. [Democratic candidate for president in 1896 and 1900, but lost to William McKinley who championed the gold standard] E. The Democratic Party co-opted Populist issues and fused them into their party platform 1\. Graduated income tax 2\. Direct election of senators F. The Populist Party laid the groundwork for the Progressive movement in the early 20^th^ century - The Wizard of Oz and Populism VII\. [Socialists] A. They felt that wealth was in the hands of too few and that investors grew rich while workers remained poor B. Industrialization was a world class struggle C. [It drew from a diverse constituency without race, class, ethnicity and religion] D. Failed to persuade most Americans, but tapped into deep discontent among the working classes VIII\. Conclusion A. Industrial capitalism brought both wealth and poverty B. Workers organized into institutionalized labor unions C. The wealthy built tremendous empires in steel, oil, railroads, and banking -- called robber barons D. Social Darwinism applied to societies E. The Populist Party emerged as a champion of farmers F. The Democratic Party adopted some of the ideals of the Populists G. Socialism was another attack on capitalism, but failed to appeal to most Americans