Study Guide

The Gilded Age Analysis

  • Labor

    Steel's Iron Man

    On July 23rd, 1892, Henry Frick—the plant manager of Andrew Carnegie's steel yard in Homestead, Pennsylvania—was working at his desk when a man, claiming to be a labor representative, entered his office. As Frick rose to greet him, the man shot him twice in the neck. 

    Frick lunged at his attacker and wrestled him to the ground, but as the two men thrashed about on the floor, Frick's assailant stabbed him several times with a steel file. Despite bleeding profusely from his many wounds, Frick managed to subdue the would-be assassin until police arrived. Frick's co-workers wrapped his wounds the best they could and urged him to go see a doctor immediately. 

    But, according to legend, he refused to leave his office. It was only mid-afternoon—not yet quitting time—and Frick would go seek medical care only when the workday ended.

    The episode won Frick accolades. The "iron man" of the steel industry was heralded as a model of heroic industriousness. When it was discovered that his attacker, Alexander Berkman, was an anarchist, sympathetic with the steel workers currently engaged in a bitter strike against the Homestead plant, Frick was celebrated by many Americans for standing firm against dangerous labor radicalism—a model of the toughness needed to bring order to America's turbulent factories. 

    But many others were more ambivalent in their attitudes towards Frick. While they condemned his would-be murderer, they also argued that Frick himself had provoked the strike in the first place by trying to crush the labor union recently formed by the workers. Berkman had clearly gone too far—but perhaps, in his own way, Frick had as well. 

    For two decades, America's industries had faced a seemingly endless series of strikes that often turned violent. Perhaps, critics suggested, industrialists needed to take a more tempered approach to their workers' complaints rather than relying always upon an uncompromising steely resolve.

    The Great Railroad Strike of 1877

    The widespread labor violence that threatened, by 1890, to spin out of control had exploded onto the national scene in 1877 with a railroad strike that crippled transportation throughout the Northeast. 

    There had been strikes before in America—but nothing that matched the scope and violence of this one. 

    In retrospect, it isn't surprising that this period of tumultuous labor unrest began with the railroads. In many ways, railroads provided the model for the new industrial economy: 

    • They required vast capital investment and relied on large management bureaucracies.
    • Railroad companies also competed ruthlessly against one another. Rival companies built extraordinarily expensive lines, sometimes parallel to those of their competitors, and then fought for business by promising faster and cheaper service.
    • The competition and costs within the industry led to harsh labor practices—15-hour days, low wages, and extremely hazardous work conditions—as companies struggled to gain any advantage in the market.

    The life of a railroad operator was so dangerous that life insurance companies routinely refused to provide coverage—in fact, the first labor organizations among railroad workers were really insurance cooperatives, brotherhoods that provided funeral funds and life insurance to their short-lived members.

    The railroads were thus a combustible industry. In 1877, when the owners of the Baltimore and Ohio (B&O) Railroad announced a pay cut—the fourth in as many years—workers walked off the job. They walked off first in Camden Junction, Maryland, but as word spread up and down the line, other B&O employees, workers from rival railroads, and even workers from entirely different industries abandoned their jobs in sympathy. 

    Together, this growing mass of workers attacked railroad yards, burning trains and tearing up tracks. The violence was the worst in Pittsburgh, where a crowd of some 5,000 workers fought 650 federal troops in a pitched battle. The workers laid waste to the railroad yard, burning more than 500 cars, 104 locomotives, and 39 buildings. The troops exacted a more deadly toll—25 people were killed when they fired into the rioting crowd. The entire bloody scene seemed to portend a bleak future of labor violence or even outright class warfare.blank" href="https://www.shmoop.com/civil-war/">Civil War. 

    For the workers and industrialists at the center of the strike, the events were less shocking than educative. Both sides realized that this was the beginning, not the end—and that steps needed to be taken to prepare for future battles.

    What Workers Learned

    Workers learned that they needed to organize. They had no chance to prevail in a power struggle against the combined forces of industrial owners and the United States government unless they built stronger unions. 

    Before 1877, union organization had been sporadic and largely local. Small craft unions organized local workers around local concerns. The great exception was the National Labor Union, formed in 1866. 77 delegates representing 60,000 workers gathered at Baltimore to launch this national organization and adopt a platform focused on securing legislation protecting the eight-hour day. 

    But the union was short-lived. Its foray into direct political action failed miserably when its 1872 candidate for president tallied fewer than 30,000 votes nationwide. And more critically, the economic depression of 1873 drove millions of workers into unemployment and out of their unions. By 1877, the nation's total union membership had fallen from a peak of 300,000 in 1872 to just 50,000.

    The Knights of Labor

    But in the decade following the railroad strike, unions grew rapidly. The most ambitious of these was the Knights of Labor. Founded in 1869, the Knights sought to build a comprehensive organization uniting workers of all races, genders, ethnicities, and occupations. 

    The Knights were equally expansive in their objectives. They lobbied government for the eight-hour day and child labor restrictions. They also campaigned for the initiative and referendum—electoral processes through which common citizens could draft and vote upon laws. But most fundamentally, and most radically, they sought to build more cooperative labor-management relations. They envisioned industries governed by councils of workers and managers within genuinely democratic, and ultimately collectively owned enterprises.

    During the 1880s, the Knights grew rapidly. By 1885, the organization claimed 100,000 members. And in that year, it experienced its greatest success. When the Wabash Railroad, one of the railroads within Jay Gould's Southwest System, tried to break a local union, the Knights walked out in sympathy. Within days, the entire Southwest System was paralyzed and the Wabash was forced to negotiate with its workers. 

    Flush with victory, the Knights drew in thousands of new members. Within a year, 750,000 workers were united under the comprehensive umbrella of the Knights of Labor.

    Craft and Industrial Unions

    More enduring gains were made by unions that sought to organize only a particular craft or industry. The American Federation of Labor (AFL), led by Samuel Gompers, was the most successful of these. 

    Less a single union than a federation of semi-independent craft associations, the AFL admitted only skilled, white men. Its objectives were also comparatively limited—the federation focused only on achieving higher wages and shorter workdays for its members, forsaking the larger social objectives that had motivated the Knights. But the AFL did grow—by 1892, it claimed more than a quarter million members.

    After the collapse of the Knights of Labor, railroad workers formed their own labor organization, the American Railways Union. It adopted an organizational strategy somewhere in between that of the Knights and the AFL. The ARU organized all railroad workers, regardless of craft or specific job, within this one union. More inclusive than the AFL, but less comprehensive than the Knights of Labor, the ARU was America's first industrial union. 

    And just a year after its founding, it achieved a major victory. When, in August 1893, the Great Northern Railroad cut workers' wages, the ARU called a strike. Within three weeks, the railroad relented and restored wages to their former levels.

    What Industrialists Learned

    But workers weren't the only ones to organize during these years. Industry owners also walked away with some lessons from the railroad strike of 1877. But the question we might ask is whether the conclusions they drew best served their interests.

    Factory pay was extremely low, and living conditions in urban slums were horrific. The rapid mechanization of American industries had transformed work and the role of work in people's lives. In the records left by workers, what jumps off the page are the complex reasons why workers were so unhappy with their lives in the factories. It wasn't just the pay, the hours, or the conditions—it was also the loss of satisfaction and status that they had formerly found through their work. 

    One worker explained that he used to call himself a "mechanic" and he considered himself "above the average working man." But with the introduction of more machinery, and the subdivision of the manufacturing process in such a way that an individual worker understood only one tiny part of that process, this once proud "mechanic" had been reduced to a "laborer." 

    He was no longer a skilled craftsman, in possession of a useful and respected body of knowledge. He was just an "ordinary laborer...the same as the others...no more and no less."blank">1920s, industrialists would decide that they could improve factory morale and productivity—and profits—by addressing some of their workers' material needs. 

    For example, in 1914, Henry Ford famously decided to offer his assembly-line workers a massive wage increase to $5 a day. The move paid for itself because absenteeism and employee turnover both decreased by orders of magnitude, increasing productivity, and the wage hike also helped Ford stay union-free for decades.

    But in the aftermath of the 1877 strike, most industrial leaders concluded only that they should close ranks and hunker down. Class conflict—perhaps violent class conflict—seemed inevitable. So, they refused to raise wages, shorten hours, or improve conditions. Instead, they developed private security forces, or hired agencies like the Pinkerton Guards, and prepared for future battles.

    The stage was set for the major labor conflicts of the 1890s. 

    While most industrial workers weren't members of unions, they'd learned the potential value of organization and they'd made some inroads in critical industries. Meanwhile, industry owners had come to believe that unions represented a mortal threat to their own interests, and resolved to organize themselves just as resolutely to take timely action to crush the workers' nascent organizational efforts before they altered the balance of power within America's industries.

    The stage was set for Homestead.

    Homestead Steel

    This background shaped events at Homestead, Pennsylvania, the site of one of Andrew Carnegie's steel plants, in 1892. 

    The Amalgamated Association of Iron and Steel Workers had managed to establish a footing at Homestead. The union represented about one-fourth of the plant's workers and had successfully negotiated a pay scale that paid workers between 14 and 20 cents per hour. But Henry Frick, the man Carnegie had left in charge of his steel empire while he semi-retired to his native Scotland, believed that this union represented a costly and dangerous precedent. 

    So, when the existing agreement between Carnegie Steel and the union expired in 1892, Frick announced pay cuts of 18 to 26%.blank">Emma Goldman—resolved to kill Henry Frick. Believing that events in Homestead represented a revolutionary moment, he hoped to inspire further resistance on the part of the strikers and other labor sympathizers. 

    He failed utterly to do so. Instead, to the vast majority of Americans, reading about the strike in their daily papers, Berkman's assassination attempt fed growing anxieties about the dire state of industrial labor relations. By 1892, Americans had witnessed 15 years of labor violence. Their initial shock had given way to a different sort of fear—and a more complex assessment of blame. 

    During the railroad strike of 1877, most newspaper editorials had blamed the workers (especially after they destroyed company property), primarily because most Americans in 1877 still retained a confidence in the ability of the economic system to allow upward mobility for those who sought it. In other words, they viewed poverty and occupational stagnation as personal failings, not failings of the system. 

    But by 1892, the analysis offered in newspapers and Sunday sermons had grown more complex. Journalists and ministers still condemned all acts of violence, but they increasingly tended also to criticize the new industrial order's seemingly declining opportunities for mobility. And many began to see labor unions less as radical and suspiciously foreign, and more as legitimate answers to the labor challenges of the new economic era. 

    Within this new, more balanced assessment, Frick's decision to destroy the fledgling steelworkers' union seemed unwise. And his decision to lock out workers and use strikebreakers and Pinkerton Guards to deny men access to their livelihoods struck many as unnecessarily hard-hearted and provocative.

    Pullman: Paradise or Prison

    It was with this growing sense of anxiety that middle-class observers greeted the efforts of George Pullman in Chicago. 

    Pullman built railroad cars at a plant just outside the city. And, as he was equally worried about the direction of industrial labor conditions, he introduced a set of innovative practices labeled "industrial paternalism." Pullman argued that industry owners had an obligation to treat their workers fairly—and that well-treated workers would reward their employers with compliant hard work. So, Pullman surrounded his factory with a company-owned community complete with houses, parks, schools, and churches.

    To middle-class observers, Pullman Town represented an enlightened alternative to the bare-knuckle union-busting methods of Henry Frick. In Pullman's little village, they saw the end of labor violence and the dawning of a new era of harmonious social relations. 

    But what they didn't see was the discontent and exploitation that actually filled the community. Rents in the village were high, about 25% higher than comparable housing outside the village. Utility prices were also billed at above-market rates.

    The Pullman Strike

    The limitations of Pullman's paternalism were revealed in 1894 when workers struck after Pullman reduced their wages. Pullman had defended the wage cuts as a necessity forced by the economic depression of 1893. But when employee negotiators demanded that Pullman also reduce the rents he charged for company housing, he fired them. 

    So, on May 11th, the workers went on strike. Just like in 1877, news of the Pullman strike spread quickly up and down the nation's rail lines—and just like in 1877, railroad workers across the country walked off the job in droves. But this time their efforts were coordinated by the American Railways Union and its charismatic leader Eugene Debs.

    Debs instructed union members not to handle any Pullman cars, and railroad managers retaliated by firing employees who complied with Debs' instructions. By the end of June, virtually every railroad in the midwestern United States was operating at a fraction of its capacity. Total freight tonnage fell to about one-fourth its pre-strike levels.

    But even though more effectively organized than the strike of 1877, the strike of 1894 eventually collapsed. Railroad owners brought in replacement workers from Canada and hired more than 3,000 private guards. President Grover Cleveland dispatched federal troops to Chicago with predictably violent results—a three-day battle between soldiers and rioting strikers in early July left 30 people dead. 

    The final blow to the strikers came when the federal government sued, arguing that the strike was interfering with the delivery of the United States mail. A federal court agreed, and declared illegal all efforts on the part of union leaders to discourage railroad workers from doing their jobs. When Debs and other leaders refused to comply, they were arrested—and within weeks the strike collapsed.

    What Middle-Class Observers Finally Learned

    For workers, the Pullman strike may have seemed just another major defeat. But for many in the general public, this latest crisis prompted a noticeable shift in opinion. 

    As in the past, violence against private property was swiftly and almost universally condemned. But the failure of yet another approach to labor relations—Pullman's paternalism—led many to believe that some sort of higher intervention was necessary. Industrialists and workers had proven themselves completely incapable of preserving labor peace—their efforts had yielded only a seemingly endless string of violent, terrifying strikes. These strikes brought the economy to a standstill and seemed to threaten the fabric of society in more profound ways. 

    Gun battles in the streets of Homestead, train yards in flames, government troops marching against American citizens on American soil—it was all too much.

    By the end of the 19th century, America's large middle class had crystallized as the demographic center of the American populace and the critical mass that shaped American politics. By the end of the century, that critical mass had moved toward the belief that the federal government needed to play a more even-handed part in mediating the labor conflicts that plagued the nation. 

    Up to this point, the federal government had always intervened on the side of the owners in breaking strikes—but the middle class began to question the justice of this approach.

    In 1901, an assassin's bullet would kill President William McKinley, elevating Vice President Theodore Roosevelt to the Oval Office. Roosevelt wasn't a nostalgic economic reformer. He applauded the rise of American industries as a critical bastion of American power. Nor was he a social leveler; he wasn't interested in transforming the basic social or economic structures of America. But he believed that these new industrial powers had to play fair—and that the federal government was responsible for ensuring that they did. 

    As the 19th century gave way to the 20th, as the Gilded Age gave way to the Progressive Era, a new president and a new public mood would combine to usher in a new era in industrial relations.

  • Gender

    Breaking the First Rule

    In the cult classic Fight Club, urban terrorist Tyler Durden (played by Brad Pitt) sums up the cause of his army's psychological maladjustment: "We are a generation of men raised by women." 

    The film, based on the 1996 novel by Chuck Palahniuk, actually offers a more extensive critique of modern life. According to the film, our work is meaningless and our "single-serving" relationships are shallow. We obsess over the junk in the IKEA catalog and we construct identity through consumption. Our lives are so flat, we feign terminal illnesses in order to tour real suffering. 

    But at the center of this critique lies the idea that men have been stripped of their masculinity. Unsatisfying work and the quest for convenience and comfort have left men something less than men. "Now, why do guys like you and me know what a duvet is?" Tyler asks. "Is this essential to our survival, in the hunter-gatherer sense of the word? No. What are we then?"

    While intended as a commentary on life in the late-20th century, the film would have resonated just as fully with audiences of the 1890s. There's more than a little irony in the concerns about masculinity that pervaded the closing decades of the 19th century. In 1890, women couldn't vote or hold public office. They enjoyed more educational opportunities but their career opportunities were few. The dominant cultural norms prescribed marriage for women—it was generally believed that women were neither physically nor intellectually suited for the demands of the workplace. The millions of working class women toiling in America's factories and sweatshops were pitied, condemned, or ignored in their "unfeminine" employment. 

    More than a century after Americans fought to defend the principle that "all men are created equal," women remained second-class citizens.

    But ironically—some might say typically—American writers and social critics obsessed far more about the condition of men as the 19th century came to a close. Despite the gross inequalities between men and women during the Gilded Age, it was the condition of men that was most lamented, the threats to American manhood that were most commonly explored.

    Work

    The supposed assault on the American man began with the changing nature of work. 

    As American cities grew, and more and more men found work in the office buildings of the American corporate economy, many worried that these forms of work bred softness. 

    Men, who'd once worked in the fresh air, working with the soil and in collusion with nature, now toiled in the stale air of an office building. Separated from nature, they were alienated from a portion of themselves—and as a result, they became less fully men.

    Comfort

    The sterility and effeminate nature of work was reinforced, many argued, by Americans' growing preoccupation with physical and emotional comfort. Since the beginning of the 19th century, a number of medical advancements had reduced the unavoidability of pain. 

    Improved anesthetics and aspirin were just the tip of the iceberg. By the end of the century, Americans could easily and legally acquire laudanum, cocaine, morphine, and opium to soften the edges of their daily lives. But these pharmacological aids were just one of the keys to modern comfort. As the Gilded Age advanced, indoor plumbing and central heating filled more and more homes, and a whole range of new consumer goods made life more convenient and comfortable.

    There was no denying the benefits of all this, but for many people, the price of comfort was an unsettling removal from the primal realities of life. Could life be too comfortable? Could a life stripped of all pain and discomfort prove too easy? 

    For a growing number of social critics, the Victorian parlor—crammed full of overstuffed furniture, heavy draperies, and shelves loaded with all of the conveniences of modern life—summed up the over-civilized and emasculating character of Gilded Age society, the softness, the clutter and the silliness of the new consumer world.

    Rationalization

    The drive for increased comfort was paralleled by the pursuit of increased rationality. The importance of the rigid regulation of the one's entire person was a value preached over the course of the entire 19th century. But the demands of the growing corporate industrial economy placed an even greater premium on the values of punctuality, order, sobriety, and industriousness. 

    The emphasis on self-rationalization was paralleled by a cult of efficiency in the factories. Frederick Taylor, an industrial scientist, preached the value of time-management and production efficiency. His legion of efficiency experts, equipped with stopwatches and clipboards, broke the production process down into micro-units, outlining the steps to ever greater workplace productivity. 

    And indeed, these values and methods did grease the wheels of the new economy. But again, growing numbers questioned the impact on the male psyche—the crushing of a former virility, the regulating into extinction of more vital qualities that had served individuals and nations in other times. Regulation might serve the workplace, but nations needed heroism and courage—the bold stroke, the creative and barrier-shattering initiative. 

    If America became a nation of self-regulated drones, could it ever live out its greater destiny?

    Religion

    Some social critics argued that even American religion had been emasculated. Over the last decades of the 19th century, the harsh demands and even harsher cosmic view of Calvinism had been replaced by the feel-good doctrines of liberal Protestantism. 

    Calvin's God of judgment and wrath had been replaced by a God of unconditional love and forgiveness. In this new version of Christianity, hell was no longer a real place or a real threat—it was just not consistent with the rational and loving God of liberal theology, the modern God that was as much committed to comfort and pain-free existence as were His people. 

    Here again, Christians flocked to the more reassuring doctrines of religious liberalism, but, as many critics pointed out, these feel-good teachings came with a price. People found peace of mind, but the universe lost some of its majesty. God became less terrible but also less awe-inspiring. 

    As cultural historian T. Jackson Lears has suggested, modern Christians "won freedom from fear but lost possibilities for ecstasy."

  • Economy

    Understanding the Gilded Age Economy

    Many argue that America's extraordinary economic development during the Gilded Age can be summarized by a handful of statistics. 

    In 1860, the nation's total wealth was $16 billion. By 1900, it was $88 billion. This translated into a per capita increase from $500 to $1,100. Driving this growth was an explosion in American manufacturing—in 1869, the manufacturing sector of the economy generated $3 billion, a figure which rose to $13 billion by 1900. This was accompanied by an increase in America's labor force from 13 million to 19 million people.

    Similarly, many economic historians suggest that America's economic development can also be reduced to a rather simple formula: the convergence of a handful of critical ingredients.

    For starters, there was an unprecedented explosion of new industrial and agricultural technology. The United States patent office issued 440,000 patents between 1860 and 1900—12 times more than during the preceding 70 years. On the farms, steam tractors and mechanical reapers, harvesters, and combines all greatly increased agricultural productivity. By 1900, it required only 15 man-hours per acre to raise wheat, while a century earlier, it had taken 56 man-hours per acre. 

    In the factories, the Bessemer blast furnace and the Siemens-Martin open hearth process radically changed steelmaking. 

    In America's office buildings, cash registers, adding machines, and typewriters transformed the way people did business. Alexander Graham Bell's telephone, developed in 1876, revolutionized business communication, while Thomas Edison's work with electricity lit homes and powered factories. 

    John D. Rockefeller employed new oil refining methods, while somewhat less famously, Charles Pillsbury and Cadwallader Washburn (Gold Medal Flour) developed technologies that delivered inexpensive high-quality flour to American kitchens.

    Second, these growing industries generated goods for growing urban markets. During the Gilded Age, America's cities exploded. By 1900, America's 30 million city dwellers represented 40% of the American population—up from 20% in 1860. About half of these new urban residents were immigrants, the vast majority of them from Europe. During the 1880s, five million people came to America from overseas. During the 1890s, immigration slowed—but there was still a net arrival of 3.7 million people from abroad.

    The other half of this new urban population migrated to the cities from America's rural areas. Contrary to the popular myth that the American West would provide a safety valve for America's overcrowded cities, migration actually flowed in the opposite direction, from the country to the city. The new residents came for a variety of reasons—some came for the jobs offered by the expanding manufacturing sector, while others came for the conveniences and excitement city life offered. The 68,000 African Americans who moved to northern cities from the South during the 1870s came for their own more complex and distinctive reasons. 

    In addition, Pullman Palace sleeper cars made travel more comfortable, and refrigerated boxcars enabled meat, vegetables, and fruits to be transported across the country. In order to make this rail system more efficient, railroad companies switched to a standard rail gauge of 4' 8.5" between 1880 and 1890, allowing different railroads to use the same equipment. 

    In the name of efficiency, the railroads even used standardized time. At the stroke of noon (Eastern Standard Time) on November 18th, 1883, the railroads introduced a carefully devised system of new time zones, ending centuries of human experience in which each town set its own clocks to a slightly different time according to the position of the sun in the sky.

    Fourth, financing for all of this came from an increased supply of capital—and from capital derived from new, more extended sources. Earlier in the century, most capital used for industrial expansion had come from the expanding companies themselves. But in the decades after the Civil War, individual personal savings increased and a whole new batch of institutions were created to capture and make available those savings to business borrowers—commercial banks, savings banks, and insurance companies all provided new vehicles for accumulating and dispensing the capital needed to fuel American economic growth.

    And finally, new forms of business organization were devised that supported economic growth. Confronted by the ragged cycles of an immature industrial economy—volatile periods of boom and bust, overproduction and then contraction in individual industries—industrialists experimented with new forms of organization. They began by forming pools or cartels. In these loose associations, former competitors became informal partners and tried to smooth out the market through the adoption of "gentlemen's agreements" on production levels and prices. 

    Soon, these informal alliances evolved into more formal cooperative ventures among owners. By forming "trusts" and "holding companies," they avoided state laws forbidding monopolies while reaping the benefits of unified control over entire industries. In these associations, the stock certificates from several companies were exchanged for trust certificates, and then a board of trustees exercised governance over all of the theoretically independent companies within the trust.

    The final step in this movement toward centralization was the merger movement of the late 1890s. Abandoning altogether the appearance of competition, industrial leaders simply absorbed their competitors. The movement began in 1897 with a record 69 mergers, and then accelerated. In 1898 there were 303 mergers, and in 1899, a whopping 1208 mergers.

    Technology, markets, infrastructure, capital, organization—the unprecedented economic growth of the Gilded Age can be attributed to textbook ingredients for economic development, a series of large structural transformations in the economy.

    The Importance of Culture

    Other economic historians, however, insist that this sort of analysis neglects equally critical ideological contributors to Gilded Age growth. 

    For starters, economic development was facilitated by a supportive culture—one which placed confidence in industrialists and businessmen and refused to permit government to interfere in their efforts. Most Americans embraced the principles of laissez faire economics, which argued that economic forces should be allowed to work themselves out with maximum freedom and minimal government interference. 

    Part of the logic was purely economic—it was believed that government involvement tended to hinder, or even prevent, economic development. But part of the argument was ethical. Laissez faire advocates argued that government interference distorted the natural and equitable forces of economic development. Government intervention was considered tantamount to "class legislation"—an unjust and artificial reallocation of economic resources and power from one group to another.

    Laissez faire ideals enabled industrialists and entrepreneurs to operate with public support and without government interference. In addition, the philosophy was translated by the courts into a set of practical rules that enabled businesses to operate with even greater autonomy. 

    For example, during the last decades of the 19th century, the court strengthened rules increasing the sanctity of the contract. State laws that attempted to regulate the workplace, like restrictions on work hours and safety requirements, were repeatedly struck down by state courts with the argument that they violated the rights of employers and employees to enter into contracts freely. Courts also increasingly applied the "fellow servant" rule, which relieved employers of responsibility for workplace injury if a contributing cause was the negligence of another employee. 

    And the courts weakened unions by insisting that employers had a right to replace striking workers while at the same time denying that strikers had a right to organize boycotts.

    For many historians, America's economic history during the Gilded Age can't be explained without reference to this philosophical and legal culture, which was so supportive of unregulated economic growth. 

    Yet still others insist that acknowledging the importance of this culture doesn't complete the story. These scholars insist that a handful of key players were critical to the particular way that America's economy unfolded. They argue that the skills and strategies of a handful of individual industrial giants were essential to America's extraordinary economic growth.

    John D. Rockefeller

    John D. Rockefeller, trained as a bookkeeper, built a monopoly over the oil business in less than a decade and brought order to a chaotic vital industry. When he entered the oil business, it was an industry subject to violent jags in production and prices. Each discovery of a new oilfield led to rapid overproduction by wealth-seeking adventurers. 

    But invariably, markets were soon glutted, prices collapsed, and producers went bust. Rockefeller's bean-counting sensibilities were repulsed by this disorder. And he recognized that control, and order, could be achieved by dominating a single bottleneck in the production process.

    So, he began to acquire refineries.

    In 1868, when he formed Standard Oil, the company was just one of 30 oil refining companies in Cleveland, processing only 5% of the nation's total oil. Over the next decade, Rockefeller built his monopoly by cultivating preferential treatment from the railroads that hauled his product. He negotiated secret contracts in which he leveraged his growing market share for lower transportation rates. These "rebates" enabled him to ship oil at a lower cost, allowing him to undercut his competitors by selling at a lower price. 

    But rebates were just the first step in his scheme. As his share of the oil refining business grew even larger, he was able to demand "drawbacks" from the railroads that desperately wanted his business—that is, a percentage of the hauling fees paid to them by other refineries. In other words, Rockefeller made money off the shipment of other refineries' oil.

    By the mid-1880s, Rockefeller refined 90% of the nation's oil. By controlling this vital bottleneck in the production process, he had established a virtual monopoly over the entire industry. With almost every drop of the country's oil flowing through his refineries, he was able to shape price structures and production decisions at every other phase of the process, from the oil wells to consumers' homes. 

    His method of controlling one aspect of the production process—labeled horizontal integration—was soon imitated by other industrialists also anxious to eliminate their competitors and to bring a similar stability (and profitability) to their industries.

    Andrew Carnegie

    Andrew Carnegie did for steel what Rockefeller did for oil. 

    In the early 1870s, he realized that the steel rails being introduced in England were superior to the iron rails used in America, and that it was only a matter of time before American railroads imitated their English cousins. And so, he set about investing in steel. Utilizing the newest technologies, like the Bessemer blast furnace and the Siemens-Martin open hearth, he built the largest steel company in America.

    And Carnegie could be as deliberate as Rockefeller in crushing his competitors—and more aggressive in crushing his workers' attempt to unionize. After first supporting the right of workers to unionize, he gave his plant manager, Henry Frick, a free hand in beating back the fledgling American Association of Iron and Steel Workers when the union tried to organize his Homestead steel plant outside Pittsburgh. 

    Despite the violence at Homestead, the public was generally more forgiving of Carnegie than they were of Rockefeller. One reason was because people found his industrial methods more defensible. Carnegie used vertical integration to bring stability to the steel industry: he worked to control the entire production process, from the iron mines through steel production and distribution. 

    By the time he retired, Carnegie's holdings were enormous. They included pig iron works, coke refineries, and a line of steamships, as well as steel works. But the public was more accepting of this sort of industrial monopoly than they were of Rockefeller's creation of a market bottleneck through horizontal integration. It seemed better to honor the spirit of market competition.

    John Pierpont Morgan

    J. P. Morgan completed the triad of America's great Gilded Age industrial giants. He similarly pursued monopoly-like control over his sector of the economy—but he ultimately established a more varied set of holdings than either Rockefeller or Carnegie. 

    Even his contemporaries disapproved of his earliest business deals—during the Civil War, he sold defective guns to the Union Army at inflated prices, and he installed a telegraph line in his office so he could buy and sell gold based on battle news from the front. 

    After the war, he brought the same shrewd instinct to his goal of monopolizing the railroads. As a result, by the end of the century, his assets included the South Atlantic, Reading, Erie, and Northern Pacific Railroads, and he held major stakes in the B&O, and the Atchison, Topeka, and Santa Fe Railroads as well. 

    But not content with controlling just the railroads, Morgan also built General Electric into a great industrial conglomerate by merging the Edison General and Thompson-Houston Electric Companies. And in 1901, he forged a merger between Carnegie Steel and several other companies to form U.S. Steel. Morgan's financial moves built the great industrial corporations that would lead the American economy's charge into the 20th century.

    What's Missing?

    It's hard to ignore the contributions of these industrial giants to the development of the American economy. But some historians suggest that focusing on these sorts of individuals still fails to capture the full character of the emerging industrial economy. Like the statistical portrait, or the reduction of the economy to a list of abstract ingredients, a focus on just a handful of powerful individuals fails to capture the character of the economy for the vast majority of America's 75 million people. 

    In particular, these approaches fail to reveal the impact of this particular form of economic growth on those at the bottom of the economic ladder. 

    The same economy that gave Carnegie, Rockefeller, and Morgan the opportunity to amass the largest fortunes in the history of the world also required unskilled industrial laborers to work an average of 60 hours per week for 10 cents an hour. (Accounting for inflation, 10 cents in 1880 was worth about as much as $2 today.)

    So, a complete economic history of the Gilded Age requires an understanding of the nation's expanding underclass. But as these people left fewer records, historians have had to patch together the character of their existence by constructing a different sort of snapshot. Their lives were lived in America's growing urban slums, places most middle-class and wealthy Americans tried to avoid. 

    More than a million people were crammed into New York's 32,000 infamous dumbbell tenements—overcrowded, poorly ventilated fire traps. Chicago's slums were three times more densely packed than Calcutta's.

    In these living conditions, disease ran rampant: cholera, typhoid, tuberculosis, consumption. Nor did it help that city governments couldn't build water and sewage facilities fast enough to serve their rapidly swelling populations. In New Orleans, the census reported that pedestrians sank in the mud made by the "oozing of foul privy vaults." In Philadelphia, the city's water supply, the Delaware River, was replenished daily with 13,000 gallons of untreated sewage.

    In short, the economic history of the late-19th century can't be too narrowly summarized. The period's label, "Gilded Age," comes close to capturing the juxtaposition of enormous wealth alongside crushing poverty. But even this only hints at the underside of America's booming economy. 

    To complete the picture, you should look at some...well, pictures. In 1890, Jacob Riis, a police reporter for the New York Tribune, published How the Other Half Lives, a stark portrait of urban slum life. His classic work, complete with text and photographs, is available here.

  • Ideology

    Old Questions, Old Answers

    Is wealth a good thing?

    • Should the rich be allowed to keep all the money they earn?
    • Or does the public have a right to a portion of that money?
    • Should businesses compete or cooperate?
    • Are we better served by an economy made up of small competing businesses, or one dominated by a handful of large monopolies?
    • What should guide a voter when casting his or her ballot?
    • Whose interests should an elected office holder serve?

    For a long time, Americans thought they knew the answers to these questions. Informed primarily by the agrarian vision of thinkers like Thomas Jefferson, Americans valorized a nation of small, independent farmers and craftsmen. 

    Wealth was suspect: it generated vice and it corrupted people and nations. Competition was valued as a source of innovation and efficiency. In addition, the hard-working small producers of this economic vision were thought to make ideal citizens. Uncorrupted by wealth, and rendered impervious to political pressure by their economic self-sufficiency, they were able, rationally and virtuously, to recognize and promote the communal interest that should lie at the center of public policy. Citizenship and patriotism were equated with self-sacrifice, the subordination of self-interest to the greater good of the nation.

    But during the Gilded Age, this vision was challenged. The huge changes in the American economy forced a reconsideration of these long-held, but perhaps obsolete values. The emergence of much larger business enterprises, the generation of much greater individual fortunes, and the surfacing of a new type of politician forced Americans to reconsider the values defining American society and politics.

    Addressing the New Dimensions of the American Economy

    The challenge to traditional American ideals began with the sheer size of America's new industries. In 1900, Andrew Carnegie operated eight steel mills and produced more than 4 million tons of steel annually. 

    Or even worse, they were dominated by the self-serving ambitions of people De Leon described as industrial tyrants—men like John D. Rockefeller. What was needed, concluded De Leon, was a central directing authority committed to the welfare of the greater community—by overseeing production, by managing the allocation and distribution of resources, the government would ensure more beautiful and more equitable economic music.

    Reconciling Wealth and Republicanism

    While Rockefeller and De Leon debated the best way to manage the size of America's economic realties, others debated the meaning and the legitimacy of the new wealth that this economy generated. In Jefferson's vision, wealth was suspect—it bred luxury and vice, and it raised frightening visions of a European aristocracy. It softened people's moral fiber and undermined the virtue that was essential to good citizenship. 

    But during the Gilded Age, Americans witnessed the growth of personal fortunes of unprecedented dimension. Homes of unprecedented size lined posh urban streets, and newspapers provided elaborate accounts of gaudy social events that violated traditional understandings of material moderation. 

    Could America—a nation built on republican values of material restraint—absorb this sort of wealth and still retain its traditional virtue?

    James Baird Weaver, a leader in the farmer's reform movement known as Populism, said no. He noted that Dives and Lazarus—Biblical characters representing wealth and poverty—"always make their appearance side by side in disturbing contrast just before the tragic stage of revolution is reached." 

    This was a far cry from Thomas Jefferson's call to disinterested public service, the surrender of self-interest to the welfare of the community. But in Plunkitt's view, citizenship, and even patriotism, were more about personal rewards than personal sacrifice. His musings were filled with stories of "patriotic" young men whose national spirit had been crushed when they were denied a city job. In one of these tragic tales, the jilted patriot eventually died in Cuba, fighting for America's Spanish enemy.

    The key to Plunkitt's power was the favor-seeking voters who did his bidding on Election Day. Plunkitt built a following from the ground up—and he offered their votes to politicians who promised him information from which he could profit and city jobs that he could distribute back to his followers. 

    Consequently, Plunkitt's great nemesis was civil service reform. A batch of reform measures dating to the 1870s, civil service sought to remove public jobs from the control of politicians like Plunkitt. In cities where these reforms were implemented, job seekers had to take a test, and positions were awarded on the basis of performance. 

    In effect, civil service reform was an attempt to restore the meritocratic ideal that Jefferson had introduced in somewhat different form under the guise of a "natural aristocracy." Jefferson had argued that good government found ways to elevate the most "talented and virtuous" among the public; civil service reform sought to identify those most fit for public bureaucracies through examinations. 

    But for a politician like Plunkitt, these reforms were a curse—they threatened to undermine the entire system of entrepreneurial government that served him, and many of his followers, so well.

    Plunkitt's ideas clashed sharply with traditional notion of political behavior. Fortunately, most Americans still find his views unsettlingly corrupt. 

    But what's most striking, and most important, about Plunkitt's ideas is that he presented them to the public willingly. He made no attempts to hide his philosophy. He wasn't offering a soul-bearing confession. He was introducing a new political ideology—a new definition of citizenship and even patriotism. And his ability to succeed with this philosophy, and then lay it before the public, speaks to the dramatic transformation of America's social and political environment during the last decades of the 19th century.

    Like Rockefeller, Carnegie, De Leon, and Weaver, Plunkitt was addressing the realities of the new order. And while Plunkitt's ideas may seem the most jarring to contemporary ears, Rockefeller's and De Leon's proclamation that the age of the individual was over was just as disturbing in their own time. 

    And before we judge Plunkitt too harshly, we should remember that he succeeded as long as he did because a large number of New York's voters supported and benefitted from his methods. Plunkitt's pragmatic, service-exchanging approach to government, while deeply contrary to traditional notions of public service, offered something to New York's working-class immigrant population that no other public agency was willing to provide.

    Eventually, city, state, and federal government officials would embrace the idea that government should play a part in solving the public's small problems—that is, they would adopt that part of Plunkitt's philosophy that suggested that improving the daily lives of common people was one of government's responsibilities. Americans would similarly draw upon the ideas of Carnegie in reconciling traditional republican values with the new levels of personal wealth, just as they would borrow from the ideas of Rockefeller and De Leon in resolving the tension between the values of competition and benefits of consolidation and central management.

    In other words, the Gilded Age changed both America and the ways we think about America. By the turn of the century, America looked much different than it did 50 years earlier, and Americans had begun to find new answers to old questions.

  • Politics

    "A Stalwart of the Stalwarts"

    In 1881, Charles Guiteau, a mentally unstable gadfly, went postal on the President of the United States, James Garfield. 

    Guiteau, whose career ambitions had bounced from religion to law to politics, believed he was entitled to a political appointment to a plum government job after campaigning for Garfield in the election of 1880. When he didn't receive the government post he thought he deserved, he bought a gun, spent two weeks learning to use it, and then shot James Garfield as the president prepared to board a train. 

    Guiteau realized that he was making history—as he waited at the train station for the president's arrival, he had his shoes shined and then arranged for a cab that could take him to jail in style. But he wasn't much of a writer. After shooting Garfield, Guiteau shouted his carefully practiced line, "I am a Stalwart of the Stalwarts—Arthur is president now." 

    It was no "Sic semper tyrannis," but Guiteau's prosaic line did reveal the political passions of the times—a period in which party loyalty was a transcendent value and the distribution of patronage was among the national government's central tasks.

    Political Corruption

    The political history of the Gilded Age is usually reduced to a tale of corruption and scandal. And indeed, there were plenty of both to go around, at all levels of public life. 

    The administration of President Ulysses S. Grant was a cesspool of graft and abuse. Treasury Department officers demanded bribes from importers if they wanted their goods to be processed efficiently. The Naval Department awarded contracts on the basis of favoritism rather than competitive bidding. The Secretary of War accepted bribes from merchants interested in lucrative trading franchises on Native American lands. Even Grant's personal secretary conspired with whiskey distillers to avoid excise taxes.

    The most high-reaching and elaborate scandal involved the Crédit Mobilier, a firm whose shady relationship with the Union Pacific Railroad was shielded from government investigation by the Vice President of the United States, Schuyler Colfax. In return for running interference against government oversight, Colfax and other government officials were allowed to buy stock using future dividends. 

    That is, he was allowed to "buy" them for free. We should all be so lucky.

    At the municipal level, the corruption was just as great and the headlines were just as sensational. The political machines that dominated urban politics distributed city jobs to loyal supporters regardless of ability, and they awarded city contracts for construction and services to those offering the largest bribes. As cities swelled with migrants moving from rural areas and immigrants arriving from Europe, roads had to be built, sewer and gas lines had to be laid, and police and fire departments had to be staffed. Political insiders grew rich meeting the needs of the rapidly expanding cities.

    The most powerful example of this political corruption was New York's Tammany Hall. This Democratic political organization capped off its smorgasbord of self-rewarding control over New York City politics by building an elaborate new city hall. 

    One loyal member of the Tammany organization was dubbed the "Prince of Plasterers" by the New York press when it was discovered that his connections had earned him a tidy $3 million for his work on the new building.

    But the corruption that plagued American politics was only the most sensational shortcoming of American political life during these decades. More subtle, but just as problematic, was the general lethargy that crippled national government and the failure of either of the major parties to advance an agenda adequate to the needs of America's rapidly changing society. 

    As America's industries expanded, as America's workers wrestled with the new demands of the industrial workplace, as industrialists devised new business structures to tame the market, as immigrants arrived in record numbers, and as America's cities swelled to the breaking point, the national government proved unable to do much more than argue about tariff rates and forms of currency.

    A Dynamic but Unambitious Democracy

    On the surface, American politics appeared vital and dynamic. 

    Voter participation rates were extraordinarily high. On average, 78% of the nation's eligible voters voted in the presidential elections between 1876 and 1896. And often, these contests were decided by razor-thin margins—Presidents Garfield, Cleveland, and Harrison all won by less than 1% in the elections of 1880, 1884, and 1888. And while the Republican Party dominated the presidency during these years, the Democrats consistently controlled the House of Representatives.

    But beneath this statistical portrait of an energetic and keenly contested political culture lay political parties that were largely indistinguishable from one another on most matters of policy and an electorate that chose sides more on the basis of ethnicity, religion, and culture than ideology or policy. 

    In other words, American political life during these years was dynamic and participatory, but there wasn't much substance to it at all.

    The observation requires some qualification. There were indeed general philosophical differences between the two major parties. Republicans tended to favor greater government involvement in economic and social issues. They retained old Hamiltonian and Whig beliefs in the value of federal action in promoting economic development. They also were more likely to support various restrictions on alcohol and modified forms of Sabbatarianism. 

    Democrats, on the other had, tended to favor small government and states' rights. They opposed government intervention in the economy and they resisted moralistic encroachments on personal freedoms. 

    But in translating these philosophies into policy, neither party was very creative or ambitious. A handful of issues dominated the national agenda for decades—tariffs and currency reform and, to a lesser extent, civil service reform. And in the absence of more expansive visions, the two parties waged battle largely for the spoils of patronage that victory would bring. 

    Voters, in similar fashion, marched in parades, attended rallies, and vehemently claimed party affiliation more as an exercise in identity formation than in an effort to chart public policy.

    It's no wonder that the presidents elected during this era were largely forgettable figures. They were loyal party functionaries who came to office with relatively narrow policy ambitions but many favors to repay. Benjamin Harrison calculated that he spent four to five hours a day on questions regarding patronage. 

    Even Cleveland, who gained national recognition as the reform mayor of Buffalo, discovered that "dreadful, damnable office seeking" demanded an extraordinary amount of his attention.

    Explaining the Political Malaise

    Why American political life became so uninspired is hard to say. Several factors converged to make the Gilded Age—politically, the years between Presidents Grant and McKinley—so unimaginative and unambitious. 

    For starters, the very competitiveness of politics during these years encouraged a sort of middling political strategy. With so many contests decided by such narrow margins, the parties aimed toward the center of the electorate and vied for the handful of swing voters that could turn an election their way. 

    Moreover, in most presidential elections, 16 states could be counted on to vote Republican, while 14 reliably voted Democrat. That left just five swing states—California, Connecticut, Indiana, New York, and Nevada—whose middle-of-the-road voters had to be courted cautiously by the rival parties. This wasn't an electoral map that encouraged bold agendas.

    In addition, there were certain philosophical factors inhibiting a more robust governmental response to the changes and challenges of the period. Most Americans embraced the laissez faire economic theories that served industrial leaders so well. According to these theories, government intervention into the economy would only gum up the wheels of progress. These economic ideas dovetailed nicely with the constitutional conservatism that dominated this period. Most Americans believed that the powers of the federal government were constitutionally severely limited. After almost a century of debate, policymakers agreed that the federal government could generate revenues through a tariff, that had a certain narrow authority over interstate internal improvements such as railroads, and that the federal government was responsible for monitoring American currency. 

    But beyond this, there was little agreement over specifics, and a general tendency to err on the side of caution in interpreting the constitution's allocation of governmental authority within the economy.

    In addition to these philosophical inhibitions to government ambition, there were what might be labeled psychological inhibitions as well. Many analysts believed that the reformist, interventionist philosophies of the 1840s and 1850s had culminated in the bloodbath of the Civil War. According to this analysis, antislavery activists, who refused to accept the conciliatory, compromising strategy modeled by the Constitution's framers, had forced a deadly, destructive war on Americans. And their self-righteous, impatient zeal had done still further damage during the period of Reconstruction labeled "radical." 

    Just like prewar antislavery activists, these radical reformers had refused to allow history to take its more patient course; they'd insisted on trying to force change upon an unready region. And consequently, nothing—perhaps worse than nothing—had been achieved.

    It was therefore the convergence of a series of demographic, historical, and philosophical factors that bred the lethargic political culture of the Gilded Age. It took the formation of a third party focusing on the needs of American farmers—the entrance into the political arena of a group of outsiders—to shake up the system and point American political development in a new direction.

    The Farmers' Revolt

    America's farmers experienced a dramatic shift in fortunes over the course of the Gilded Age. In the years after the Civil War, growing urban markets and increased exports to Europe inspired agricultural expansion into the Midwest. Between 1860 and 1900, farmers placed 430 million new acres under cultivation. To assist them in their work, new technologies and new fertilizers rapidly increased productivity. And America's expanding network of railroads enabled Midwestern farmers to transport their crops to eastern markets and ports.

    But by 1880, farmers' once lucrative markets had weakened. Increased production in Europe and South America, and European tariffs that blocked American exports, left American farmers facing increased competition and falling prices. 

    In addition, farmers experienced the flip side of their new technology—increased productivity meant that market saturation could be achieved by fewer men. By 1900, one farmer could produce as much wheat as it had taken twenty to produce in 1860.

    As domestic and foreign markets shrank, farmers' prospects dimmed, especially since many carried large debt burdens optimistically taken on during the preceding boom decades. But rather than go broke quietly, farmers attempted to adapt the organizational lessons of industry and labor to their own sector of the economy. They began to organize and experiment with the benefits of cooperation and size. 

    The Grange (founded in 1867) and the Farmers' Alliance (founded in 1877) introduced marketing and equipment cooperatives, collectively owned mills, and even credit unions. But by 1890, farmers had decided that they needed to take their organizational efforts to the next level—so they formed their own political party. In July 1892, 1300 delegates gathered at Omaha, Nebraska to write a national platform and select a presidential nominee—The People's (or Populist) Party was born.

    Breaking ties with the established parties was often a painful process in an era when party affiliation was a critical part of personal identity. But easing this separation was the particular character of the farmers' analysis of their circumstances. In sorting out the causes of their economic distress, they tended to focus less on the structural changes within international markets than the "conspiracy" of Eastern money interests that they believed was working against them—banks that charged exploitive interest rates, railroads that levied discriminatory rates, and commodities middlemen that reaped the greatest rewards from the farmers' back-breaking labor. 

    There was some validity to their assessment. Railroads, in particular, were guilty of charging discriminatory rates on western goods—a producer paid 95 cents per ton from Chicago eastward, but $3.20 per ton west of the Missouri river. 

    But more important than the actual accuracy of their assessment was the way that it functioned to tie farmers together as a victimized class. In blaming bankers, middlemen, and railroad tycoons—all agents of the new industrial economy—for their woes, farmers were able to transform their economic concerns into a crusade on behalf of America's agrarian past. 

    In blaming a conspiracy of money men rather than the vicissitudes of global markets, farmers were able to build a coherent movement rather than just a political coalition, a movement for justice rather than just another political party.

    The Populist Platform

    United and given direction by their conspiratorial analysis of farmers' predicament, the Populist Party advanced an ambitious agenda that called for unprecedented levels of government involvement in the economy. 

    Arguing that the Interstate Commerce Commission, created in 1877 to regulate the railroads, had proven completely inadequate to this task, they proposed that the government assume ownership of the railroads, as well as the telegraph lines. Complaining that the current network of national and state banks charged excessively high interest rates on rural borrowers, they recommended the creation of "postal savings banks" controlled by locally elected officials.

    To address what they perceived as inequities in local and state tax systems, the Populists argued that property taxes should be replaced by a graduated income tax. After all, they argued, in an industrial economy acreage was a poor indicator of wealth. And to redress what they saw as inequities in land ownership, they proposed that the land reclaimed through the nationalization of the railroads be made available to agrarian settlers.

    The Populist Party also proposed an innovative government agency labeled the regional subtreasury. Since farmers were often victimized by falling prices, but yet were unable to hold onto their crop until prices rose because they had debts to service, the Populists proposed that the federal government create a network of storage/credit institutions that would lend farmers a percentage of their crops' value while they waited for prices to rise.

    And finally, the Populists suggested that the federal government should increase the amount of money in circulation through the "free coinage" of silver. 

    Since the Civil War, Americans had debated how much and what kind of money should be allowed to circulate. While some suggested a limited supply of money, backed only by gold, would ensure that its value would be sustained, others argued that an expanded money supply, backed also by silver, would facilitate economic growth and allow common people easier access to cash. 

    By 1890, something of a compromise had been reached. Gold was coined and placed into circulation, and gold-backed bank notes circulated as a form of currency. Silver was also coined, but the amount was severely limited in order to contain the amount of money in circulation and protect its value.

    Populists argued that the money supply produced by this compromise was inadequate to the needs of America's expanding population, and that the limitations placed on the coinage of silver hurt farmers and other common people unable to compete with more affluent borrowers. But if silver was freely coined, if the government coined all of the silver available to it, America's money supply would grow, crop prices would rise, and borrowers would be able to more easily pay down their debts. 

    In modern economic terms, the farmers wanted the government to pursue an inflationary monetary policy.

    By the middle of the 1890s, the farmers had built a national political party with growing membership throughout the South and Midwest. And unlike the other major parties, they'd advanced a creative and pragmatic solution for the farmers' problems.

    What effect the farmers' solution would have had on the other sectors of the economy was another question entirely, of course.

    Unlike the other parties, the Populists had managed to shake off many of the philosophical and historical inhibitions that had limited the national government for the previous thirty years. And, for better or for worse, they had forced the other parties to take notice.

    The Fate of Third Parties

    The Democrats were the hardest hit by the farmers' defections from their party to the Populists. They, far more than the Republicans, relied on southern and western votes. And so they did what America's major political parties usually do when facing a challenge from a third party—they co-opted one of their challengers' issues and stole most of their thunder. 

    At the 1896 Democratic National Convention, Nebraska Congressman William Jennings Bryan delivered a ringing call for the free coinage of silver. Declaring that "you shall not press down upon the brow of labor this cross of thorns, you shall not crucify mankind upon a cross of gold," the messianic Bryan brought convention delegates to their feet. 

    A few days later, he was named the party's nominee for the presidency.

    The Populists were left in quandary. Many among the rank and file had earlier encouraged joining forces with the Democrats. These "fusionists" now urged their fellow-Populists to join the Democrats in nominating Bryan for the presidency. A second group, labeled "mid-roaders," argued that the Democrats would never embrace the full breadth of the Populist agenda—after all, silver was just one plank of their platform. If they allowed themselves to be absorbed by the Democrats, their full agenda and the distinctive character of their movement would be lost. 

    But the fusionists prevailed—the People's Party followed the Democrats in naming Bryan its nominee, and the mid-roaders succeeded only in placing one of their own, Tom Watson, on the Populist ticket as the vice-presidential candidate.

    The decision to embrace Bryan may have been the judicious course, but the Populist Party would never be the same. Much of the crusade-like enthusiasm that had animated the party's rank-and-file was lost in the decision to accept the candidate of the old, established party. And when Bryan was defeated by Republican William McKinley in the general election, many Populists lost confidence in political action altogether.

    Over the next several years, other factors would converge to weaken the Populist appeal. The discovery of gold in the Yukon would dramatically increase the nation's gold reserves, and consequently the nation's money supply; the Yukon Gold Rush had much the same inflationary impact that free silver would have done. 

    At the same time, poor European harvests would boost prices for American agricultural products. 

    But while the Populist Party would never recover, the Populists' insurgency had produced a revolution of sorts in American politics. They had, at least for a moment, broken the stranglehold of the two traditional parties and produced a viable third alternative for American voters. They had articulated a creative and expansive platform that spoke to real issues left unaddressed by the other parties. And they had scared the Democrats and the Republicans to death. 

    In the decades that followed, both parties would recognize the need not just to reach out to these disaffected voters, but to re-imagine the role of government in this new industrial era.