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The American Nation
A History of the United States
Fourteenth Edition
Chapter
17
An Industrial Giant
Emerges
The American Nation: A History of the United States, Fourteenth Edition
Mark C. Carnes • John A. Garraty
Copyright ©2012, ©2008 by Pearson Education, Inc.
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Essentials of Industrial Growth
The American Nation: A History of the United States, Fourteenth Edition
Mark C. Carnes • John A. Garraty
Copyright ©2012, ©2008 by Pearson Education, Inc.
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Essentials of Industrial Growth
• Value of manufactured products grew from
$1.8 billion in 1859 to over $13 billion in
1899
• American manufacturing flourished
because:
 New natural resources were discovered and
exploited thereby increasing opportunities
 Opportunities attracted the brightest and most
energetic of an expanding population
The American Nation: A History of the United States, Fourteenth Edition
Mark C. Carnes • John A. Garraty
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Essentials of Industrial Growth (cont'd)
 Growth of the country added to the size of the
national market
 Protective tariffs shielded the market from
foreign competition
The American Nation: A History of the United States, Fourteenth Edition
Mark C. Carnes • John A. Garraty
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Essentials of Industrial Growth (cont'd)
• Search for wealth led to corrupt business
practices: stock manipulation, bribery,
cutthroat competition
• European immigrants provided needed
labor
 2.5 million arrived in 1870s
 Twice as many arrived in 1880s
The American Nation: A History of the United States, Fourteenth Edition
Mark C. Carnes • John A. Garraty
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Essentials of Industrial Growth (cont'd)
• Period of rapid advance in basic science
leading to new machines, processes and
power sources that increased industrial
and agricultural productivity
 Displaced some people
 Made farmers dependent on vagaries of
distant markets and powerful economic
forces beyond their control
The American Nation: A History of the United States, Fourteenth Edition
Mark C. Carnes • John A. Garraty
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Essentials of Industrial Growth (cont'd)
• Improved milling of grain led to packaged
cereals
• Commercial canning of food expanded
rapidly
• Cigarette rolling machine created a new
industry
• George B. Eastman developed massproduced, roll photographic film and
simple but efficient Kodak camera
The American Nation: A History of the United States, Fourteenth Edition
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Essentials of Industrial Growth (cont'd)
• Remington company perfected the
typewriter in the 1880s, revolutionizing the
way office work was performed
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Railroads: The First Big Business
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Mark C. Carnes • John A. Garraty
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Railroads: The First Big Business
• 1865: 35,000 miles of track
• 1875: 74,000 miles of track
• 1900: 193,000 miles of track
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Railroads: The First Big Business
• 1890: mature but growing system took in
over $1 billion in passenger and freight
revenues (federal income was only $403
million)
 Value of railroad property was more than $8.7
billion
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Railroads: The First Big Business
(cont'd)
• Emphasis in railroad construction after
1865 was on organizing integrated
systems
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Mark C. Carnes • John A. Garraty
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Railroads: The First Big Business
(cont'd)
• Lines had high fixed costs—taxes, interest
on bonds, maintenance of track and rolling
stock, salaries of office personnel—so to
earn profits had to carry as much traffic as
possible
 Spread out feeder lines to draw business into
main lines
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Railroads: The First Big Business
(cont'd)
• Cornelius Vanderbilt built one of first
interregional railroad networks with his
combination of lines in New York with
those in the Midwest in 1870s
• At the same time, Thomas Scott was
building connections from Pennsylvania to
Midwest
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Railroads: The First Big Business
(cont'd)
• By 1869, Erie extended from New York to
Cleveland, Cincinnati, and St. Louis and
soon extended to Chicago
• 1874: Baltimore and Ohio also reached
Chicago
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Railroads: The First Big Business
(cont'd)
• Jay Gould was dominant system builder of
Southwest
 Consolidated Kansas Pacific (Kansas City to
Denver) with Union Pacific and Missouri
Pacific (Kansas City to St. Louis)
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Railroads: The First Big Business
(cont'd)
• Henry Villard constructed another great
complex in Northwest based on control of
Northern Pacific
• James J. Hill controlled another large
network, the Great Northern
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Railroads: The First Big Business
(cont'd)
• Civil War highlighted need for railroad
connections to South
 Chesapeake and Ohio opened a direct route
from Norfolk, Virginia, to Cincinnati
 By 1880s: Richmond and West Point Terminal
Company controlled 8,558 mile network
 Most of lines were controlled by northern
capitalists
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Railroads: The First Big Business
(cont'd)
• Trunk lines connected, which created need
to standardize many of their activities
 1883: Railroads developed present system of
time zones
 1886: Standard track gauge developed
 Standardized car coupling and braking
systems, even standard methods of
accounting were essential
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Railroads: The First Big Business
(cont'd)
• Lines sought to work out fixed rates for
carrying different types of freight, charging
more for valuable than for bulky freight
and agreeing to permit rate concessions to
shippers to avoid hauling empty cars
• By 1880s, a professionalized railroad
management saw the advantages of
cooperating with one another to avoid
“senseless” competition
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Railroads: The First Big Business
(cont'd)
• Railroads in sparsely settled regions and
in areas with underdeveloped resources
devoted money and effort to stimulating
local economic growth
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Railroads: The First Big Business
(cont'd)
• To speed settlement of new regions,
railroads:
 Sold land cheaply and on easy terms
 Offered reduced rates to travelers interested
in buying farms and set up “bureaus of
immigration” that distributed brochures
describing the wonders of the new country
 Sent agents to eastern ports and to Europe to
encourage immigrants
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Railroads: The First Big Business
(cont'd)
• Technological advances accelerated
economic development
 1869: George Westinghouse invented air
brake, which made possible increase in size
of trains and speed at which they could be
operated
 1864: George Pullman invented sleeping car
 To pull heavier trains, more powerful
locomotives were needed
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Railroads: The First Big Business
(cont'd)
• Technological advances accelerated
economic development
- In turn led to call for more durable rails which was
supplied by steel that had become cheaper due to
technological innovations
• Railroads had close ties with Western
Union Telegraph, which they let string
wires along their rights of way in exchange
for free telegraph service
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Iron, Oil, and Electricity
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Iron, Oil, and Electricity
• Iron industry
 Output rose from 920,000 tons in 1860 to
10.3 million tons in 1900
 Big break in production of steel which
combines hardness of cast iron with
toughness of wrought iron
- Problem: Too expensive
- Solution: 1850s Bessemer Process developed by
Henry Bessemer of England and perfected by
William Kelly of Kentucky
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Iron, Oil, and Electricity (cont'd)
• Iron industry
 Bessemer process and open-hearth method
introduced commercially in 1860s
- 1870: 77,000 tons of steel produced
- 1890: 5 million tons
• Pittsburgh became iron and steel capital of
country (separate complex developed
around Birmingham, Alabama)
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This 1900 photograph of steel factories at night
in Duquesne, near Pittsburgh, was tinted by
hand.
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Iron, Oil, and Electricity (cont'd)
• Petroleum Industry
 1859: First successful well drilled by Edwin
Drake in Pennsylvania
 Production ranged between 2 and 3 million
barrels a year during Civil War but had
reached 50 million barrels by 1890
 Prior to auto and gasoline engine, major use
was kerosene for lamps
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Iron, Oil, and Electricity (cont'd)
 By early 1870s refiners developed process to
obtain more kerosene and to use the
byproducts
 Increase in supply of crude oil drove prices
down
 Put a premium on refining efficiency which
meant larger plants using more expensive
machinery and employing skilled technicians
became more important
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Iron, Oil, and Electricity (cont'd)
- In mid-1860s only three refineries could process
2,000 barrels a week
- By 1870s, plants capable of handling 1,000
barrels a day were common
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Iron, Oil, and Electricity (cont'd)
• Telephone and Electric Light Industry
 Telephone invented in 1876 by Alexander
Graham Bell
- By 1900: almost 800,000 telephones in U.S.
(twice total for all Europe)
- Dominated by American Telephone and Telegraph
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Iron, Oil, and Electricity (cont'd)
 Thomas Edison built prototype of modern
research laboratory at Menlo Park in New
Jersey, where he developed the electric light
in 1879
- 1882: opened power station in New York City
- By 1898, there were 3,000 stations in the country
 Electricity replaced steam power in factories
and by early 20th century 6 billion kilowatt
hours of electricity were produced annually
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Competition and Monopoly:
The Railroads
The American Nation: A History of the United States, Fourteenth Edition
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Competition and Monopoly:
The Railroads (cont'd)
• To deal with loss of profits from
competition, railroads:
 Issued rebates and drawbacks
 Gave passes to favored shippers
 Built sidings at the plants of important
companies without charge
 Gave freely of their landholdings to attract
businesses to their territory
 Charged higher rates at waypoints where no
competition existed
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Competition and Monopoly:
The Railroads (cont'd)
• Cheap transportation stimulated economy
but cutthroat competition hurt it
 Small shippers, and anyone located where
there was no competition, suffered
 Railroad discrimination speeded
concentration of industry in large corporations
located in major centers
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Competition and Monopoly:
The Railroads (cont'd)
 Instability of rates hampered planning
 Loss of revenue from rate cutting combined
with inflated debts put most railroads in
trouble when economic downturn came
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Competition and Monopoly:
The Railroads (cont'd)
• 1880s: major roads responded to
problems by building or buying lines to
create interregional systems—the first
giant corporations, capitalized in the
hundreds of millions of dollars
 Led to another wave of bankruptcies when
true depression hit in 1890s
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Competition and Monopoly:
The Railroads (cont'd)
• Reorganization put most railroads under
control of financiers such as J. Pierpont
Morgan
 Opposed rate wars, rebating and other
competitive practices
 Because representatives of bankers sat on
the board of every railroad they saved,
control of railroad network became
centralized
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Competition and Monopoly: Steel
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Competition and Monopoly: Steel
• Iron and steel industry intensely
competitive
 Demand varied erratically
 New technology put emphasis on efficiency
 Improved transportation let widely separated
manufacturers compete with one another
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Competition and Monopoly:
Steel (cont'd)
• Andrew Carnegie (born in Scotland) was
the kingpin of the industry
 1890: Carnegie Steel Company dominated
the industry
 Output increased tenfold in next decade
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Competition and Monopoly:
Steel (cont'd)
• 1901: Morgan put together United States
Steel—world’s first billion dollar
corporation
 Included all Carnegie properties (wanted to
retire and do social good), Federal Steel
Company (Carnegie’s largest competitor),
American Steel and Wire Company, the
American Tin Plate Company, and National
Tube Company
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J.P. Morgan
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Competition and Monopoly: Oil
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Competition and Monopoly: Oil
• Output surged ahead of demand
• 1870s: chief refining areas were
Cleveland, Pittsburgh, Baltimore, and New
York City
 1870: Standard Oil Company of Cleveland
founded by John D. Rockefeller
 By 1879: controlled 90% of nation’s oil
refining capacity along with a network of oil
pipelines and large reserves of petroleum in
the ground
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Competition and Monopoly: Oil
(cont'd)
• Won control of market
• Obtained 10% rebate and drawbacks on
competitors’ shipments from railroads
 Cut prices locally to force small independents
to sell out or face ruin
 Kerosene was sold in grocery stores so
Standard supplied its outlets with meat,
sugar, and other supplies at artificially low
prices in order to crush outlets that sold other
brands
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Competition and Monopoly: Oil
(cont'd)
 Employed spies to track down customers of
other brands and offer them cheap prices
 Bribery
• Rockefeller sought not so much to crush
competition as to get them to join him
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Competition and Monopoly: Oil
(cont'd)
• To stabilize monopoly, Rockefeller created
the trust (1879, perfected 1882)—stock
from companies acquired was turned over
to “trustees” who were empowered to
exercise general supervision and in
exchange stock holders received trust
certificates on which dividends were paid
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Competition and Monopoly:
Retailing and Utilities
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Competition and Monopoly:
Retailing and Utilities
• In early stages of electric light and
telephone industry, Edison and Bell spent
a large amount of time in court protecting
their patents
• 1892: Edison and Thomson-Houston
Electric merged to form General Electric, a
$35 million corporation whose only major
competition was Westinghouse
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Competition and Monopoly:
Retailing and Utilities (cont'd)
• In retail, the period saw growth of
department stores
 1862: Alexander Stewart had an 8-story
emporium in New York City
 By 1880s John Wanamaker in Philadelphia
and Marshall Field in Chicago had similar
establishments
- Advertised heavily, stressing low prices, efficient
service, and money-back guarantees
- High volume made for large profits
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American Ambivalence to
Big Business
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American Ambivalence to
Big Business
• Americans believed in laissez-faire
government non-interference
• Encouraged by belief in Darwinian
theories
 By the 1870s his theory was influencing
opinion in U.S.
 Nature had ordained a kind of inevitable
progress, governed by natural selection of
individual organisms best adapted to survive
in a particular environment
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American Ambivalence to
Big Business (cont'd)
 Complemented reasoning of classical
economists and concept of “invisible hand”
• William Graham Sumner took these ideas
and applied to social relations—social
Darwinism
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American Ambivalence to
Big Business (cont'd)
• Yet while Americans disliked powerful
governments in general and strict
regulation of the economy in particular,
they never meant they objected to all
government activity in the economic
sphere
 Banking laws, tariffs, internal improvement
legislation, and the granting of public land to
railroads
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American Ambivalence to
Big Business (cont'd)
• Americans concerned by new corporate
enterprises
• Also concerned about monopoly
 Worried they were destroying economic
opportunity and threatening democratic
institutions
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American Ambivalence to
Big Business (cont'd)
• Businessmen responded that
concentration was necessary to create
stability, economy, efficiency, and benefit
the community
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American Ambivalence to
Big Business (cont'd)
• Laissez-faire
 A French term—literally, “to let alone”— used
in economic contexts to signify the absence
of governmental interference in or regulation
of economic matters.
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American Ambivalence to
Big Business (cont'd)
• Social Darwinism
 A belief that Charles Darwin’s theory of the
evolution of species also applied to social and
economic institutions and practices: The
“fittest” enterprises or individuals prevailed,
while those that were defective naturally
faded away; society thus progressed most
surely when competition was unrestricted by
government.
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The Biltmore Estate in Asheville, North Carolina
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Reformers: George, Bellamy, Lloyd
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Reformers: George, Bellamy, Lloyd
• 1879: Henry George published Progress
and Poverty, an attack on uneven
distribution of wealth and proposed a
property tax to take profit landowners
earned just by holding land—single tax
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Reformers: George, Bellamy, Lloyd
(cont'd)
• 1888: Edward Bellamy wrote utopia novel
Looking Backward, 2000–1887
 Sold over a million copies in first few years
 Described a future America that was
completely socialized
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Edward Bellamy
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Reformers: George, Bellamy, Lloyd
(cont'd)
• 1894: Henry Demarest Lloyd wrote Wealth
Against Commonwealth which attacked
Standard Oil and application of Darwin’s
survival of the fittest to economic and
social affairs and condemned laissez-faire
policies
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Reformers: George, Bellamy, Lloyd
(cont'd)
• None questioned underlying values of
middle class majority
• Insisted reform could be accomplished
without inconvenience to any class or
individual
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Table 17.1 Defenders of Economic
Consolidation
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Reformers: The Marxists
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Reformers: The Marxists
• 1877: Socialist Labor party formed
• 1884: Lawrence Gronlund attempted to
explain Marx’s ideas to the American
public
 Capitalism contained the seeds of its own
destruction
 State ought to own all means of production
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Table 17.2 Reformers Oppose Economic
Consolidation
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The Government Reacts to Big
Business: Railroad Regulation
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The Government Reacts to Big
Business: Railroad Regulation
• Political action regarding business
regulation began on state level with
railroads
 By end of century 28 states had railroad
commissions to supervise lines in their states
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The Government Reacts to Big
Business: Railroad Regulation (cont'd)
• National Grange of the Patrons of
Husbandry, founded in 1867 by Oliver H.
Kelley, was created to provide social and
cultural benefits for isolated rural
communities
 14 states had Granges by 1872
 1874: Membership reached 800,000
 Became political—candidates won seats in
Southern and Western state legislatures
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The Government Reacts to Big
Business: Railroad Regulation (cont'd)
• Munn v. Illinois (1877): grain elevator
operator refused to comply with a state
warehouse act but Supreme Court ruled
that a business that served a public
interest was subject to state control
 Legislatures might fix maximum charges and
if they seemed unreasonable then
businesses should complain to legislatures or
voters and not courts
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The Government Reacts to Big
Business: Railroad Regulation (cont'd)
• Wabash, St. Louis & Pacific Railroad v.
Illinois (1886): declared unconstitutional an
Illinois regulation outlawing the long-runshort-haul evil—essentially stating that
Illinois could not regulate interstate
shipments
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The Government Reacts to Big
Business: Railroad Regulation (cont'd)
• Congress filled the gaps created by
Wabash decision by passing the Interstate
Commerce Act (1887)
 States all charges made by railroads shall be
“reasonable and just”
 Rebates, drawbacks, the long-and-short-haul
evil and other competitive practices were
deemed illegal as were monopolistic
counterparts—pools and traffic-sharing
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The Government Reacts to Big
Business: Railroad Regulation (cont'd)
 Railroads were required to publish schedules
of rates and forbidden to change them
without due public notice
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The Government Reacts to Big
Business: Railroad Regulation (cont'd)
 Established Interstate Commerce
Commission (ICC), first federal regulatory
board, to supervise the affairs of railroads,
investigate complaints and issue cease and
desist orders when railroads acted illegally
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The Government Reacts to Big
Business: Railroad Regulation (cont'd)
• National Grange of the Patrons of
Husbandry
 A farmers’ organization, founded in 1867 by
Oliver H. Kelley, that initially provided social
and cultural benefits but then supported
legislation, known as the Granger laws,
providing for railroad regulation.
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The Government Reacts to Big
Business: Railroad Regulation (cont'd)
• Interstate Commerce Act
 Federal law establishing the Interstate
Commerce Commission in 1887, the nation’s
first regulatory agency.
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The Government Reacts to Big
Business: The Sherman Antitrust Act
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The Government Reacts to Big
Business: The Sherman Antitrust Act
• First antitrust laws originated in southern
and western states—were vaguely worded
and ill-enforced
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The Government Reacts to Big Business:
The Sherman Antitrust Act (cont'd)
• 1890: federal passage of Sherman
Antitrust Act
 Any combination “in the form of trust or
otherwise” that was “in restraint of trade or
commerce among the several states, or with
foreign nations” was declared illegal
 Persons forming such combinations were
subject to fines of $5,000 and a year in jail
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The Government Reacts to Big Business:
The Sherman Antitrust Act (cont'd)
 Individuals and businesses who suffered
losses as result of illegal combinations could
sue in federal court for triple damages
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The Government Reacts to Big Business:
The Sherman Antitrust Act (cont'd)
• Supreme Court quickly emasculated act:
United States v. E.C. Knight Company
(1895) held that the American Sugar
Refining Company had not violated the
law by taking over a number of important
competitors even though now controlled
98 percent of sugar refining in U.S.
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The Government Reacts to Big Business:
The Sherman Antitrust Act (cont'd)
• Supreme Court did rule in 1898 and 1899
that several agreements to fix prices or
divide the market violated the Sherman
Act
 Led to outright mergers in which a handful of
large companies swallowed hundreds of
smaller companies
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The Government Reacts to Big Business:
The Sherman Antitrust Act (cont'd)
• Sherman Antitrust Act
 A federal law, passed in 1890, that outlawed
monopolistic organizations that functioned to
restrain trade.
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Table 17.3 Major Congressional and Supreme
Court Decisions Concerning Corporations
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The Labor Union Movement
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The Labor Union Movement
• Aside from ironworkers, railroad workers,
and miners, few industrial laborers
belonged to unions
• The growth of national craft unions was
stimulated by labor dissatisfaction during
the Civil War
 1866: National Labor Union was founded
 By early 1870s: many new trades had been
unionized
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The Labor Union Movement (cont'd)
 Most of leaders were visionaries who were
out of touch with practical needs of workers
- Opposed the wage system, strikes, and anything
that increased the workers’ sense of being
members of the working class
- Major objective was formation of worker-owned
cooperatives
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The Labor Union Movement (cont'd)
• 1869: Knights of Labor founded by Uriah
S. Stephens and headed by Terence V.
Powderly
 Supported political objectives that had no
direct connection with working conditions
such as currency reform and curbing of land
speculation
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The Labor Union Movement (cont'd)
 Rejected idea that workers must remain part
of working class, believing instead that
workers could pool their resources and
advance up the economic ladder and enter
the capitalist class
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The Labor Union Movement (cont'd)
 Attacked wage system and frowned on strikes
 Tended to be more industrial rather than craft
oriented
 Welcomed blacks, women, unskilled workers
and immigrants
 Demanded 8-hour day
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The Labor Union Movement (cont'd)
• Originally Knights were a secret
organization that had about 10,000
members by 1879
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The Labor Union Movement (cont'd)
• Under Powderly, secrecy was abandoned
and successful strikes in 1882 and 1886
brought new recruits
 1882: 42,000 members
 1885: 110,000 members
 1886: 700,000 members
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The Labor Union Movement (cont'd)
• National leadership unable to control
locals who engaged in poorly planned and
unsuccessful strikes while public became
alienated by sporadic acts of violence and
intimidation
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The Labor Union Movement (cont'd)
• 1886: several hundred thousand workers
were on strike in various parts of the
country by May in support of the 8-hour
day
 In Chicago, 80,000 were involved
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The Labor Union Movement (cont'd)
• When a striker was killed at the
McCormick Harvesting Machine Company,
anarchists called a protest meeting on
May 4 in Haymarket Square
 Police intervened to break up the meeting
and someone hurled a bomb into their ranks
killing seven police officers and injuring a
number of others
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The Labor Union Movement (cont'd)
• Knights of Labor
 A national labor organization, formed in 1869
and headed by Uriah Stephens and Terence
Powderly, that promoted union solidarity,
political reform, and sociability among
members. Its advocacy of the eight-hour day
led to violent strikes in 1886 and the
organization’s subsequent decline.
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The American Federation of Labor
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The American Federation of Labor
• In response to Haymarket, 7 anarchists
were condemned to death and 4 were
executed
• Knights of Labor, while not actually
involved, was believed to be by the public
and soon ceased to exist as a force in the
labor movement
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The American Federation of Labor
(cont'd)
• American Federation of Labor (AFL), a
combination of craft unions formed in
1886, took its place
 Concentrated on “bread and butter” issues
such as higher wages and shorter hours
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The American Federation of Labor
(cont'd)
• AFL accepted that most workers would
remain wage earners all their lives and
tried to develop in them a sense of
common purpose and pride in their skills
and station
 Unions were a club as well as a way of
defending and advancing rights
 Chief weapon was the strike
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The American Federation of Labor
(cont'd)
 Federation worked for 8 hour days,
employers’ liability, and mine safety laws but
stayed out of politics
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The American Federation of Labor
(cont'd)
• AFL grew
 1886: 150,000 members
 1892: 250,000 members
 1901: passed the million mark
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The American Federation of Labor
(cont'd)
• American Federation of Labor (AFL)
 A union, formed in 1886, that organized
skilled workers along craft lines. It focused on
workplace issues rather than political or
social reform.
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Labor Militancy Rebuffed
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Labor Militancy Rebuffed
• AFL stress on strikes reflected increasing
labor militancy, especially since average
employer acted as a tyrant toward workers
and refused to bargain collectively with
unions
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Labor Militancy Rebuffed (cont'd)
• 1877—Great Railroad Strike
 Began on Baltimore and Ohio system in
response to wage cut and spread through
other eastern lines and then throughout West
until about two thirds of railroad mileage in
country was shut down
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Labor Militancy Rebuffed (cont'd)
• 1877—Great Railroad Strike
 Violence broke out, railroad yards were
torched, businessmen formed militia
companies to patrol streets of Chicago
 Eventually President Hayes sent federal
troops to restore order
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Labor Militancy Rebuffed (cont'd)
• Twice as many strikes occurred in 1886 as
in any previous year
• 1892: Violent strike by silver miners at
Coeur d’Alene, Idaho
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Labor Militancy Rebuffed (cont'd)
• Homestead Strike at Carnegie’s steel plant
near Pittsburgh—strikers attacked 300
private guards brought in to protect
strikebreakers
 7 guards killed and the rest forced to
“surrender”
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Labor Militancy Rebuffed (cont'd)
 Steel producers insisted the workers were
holding back progress by resisting
technological advances while workers
believed company was refusing to share the
fruits of more efficient operation fairly
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Labor Militancy Rebuffed (cont'd)
 Strike started when company decided to
crush union
 Defeated after 5 months, destroyed
Amalgamated Association of Iron and Steel
Workers and eliminated unionism in steel
industry
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Labor Militancy Rebuffed (cont'd)
• 1894—Pullman Strike
 Workers at Pullman Company outside
Chicago walked out in protest of wage cuts
and failure of Pullman to reduce rents in the
company town accordingly
 Some workers belonged to American Railway
Union headed by Eugene Debs
 After strike had dragged on, union voted not
to handle any trains with Pullman cars
attached
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Labor Militancy Rebuffed (cont'd)
• 1894—Pullman Strike
 Railroad owners appealed to President
Cleveland who, on the pretext of ensuring the
movement of the mail, sent soldiers
 Debs defied an injunction to end the strike
and was jailed
 The strike was broken
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Whither America,
Whither Democracy?
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Whither America,
Whither Democracy?
• Each year, more of the nation’s wealth
was in fewer hands
 By 1913: Morgan and the Rockefeller
National City Bank group between them could
name 341 directors to 112 corporations worth
over $22.2 billion
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Whither America,
Whither Democracy? (cont'd)
• Centralization increased efficiency in
industries that used a great deal of
expensive machinery to turn out goods for
the mass market and in those where close
coordination of output, distribution and
sales was important
 Living standards rose
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Whither America,
Whither Democracy? (cont'd)
• Courts seemed only concerned with
protecting the rich and powerful
 Eugene Debs, in prison for contempt,
became a socialist in 1897
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Chapter Review
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