The label “Gilded Age” comes from the title of an 1873 book by Mark Twain and Charles Dudley Warner—The Gilded Age: A Tale of Today. The book is a political satire, depicting a greedy, materialistic society where people aimed to get rich quickly, with little concern for ethical standards. It is not one of Twain’s best-known or most critically acclaimed works, but the title seemed a fitting label for an era of extravagant wealth juxtaposed against extreme poverty, and it stuck.

These last decades of the nineteenth century were marked by explosive growth, in terms of wealth and population. The population of the United States nearly doubled between 1870 and 1900—from an estimated 40 million in the 1870 census to an estimated 76 million at the end of the century, with much of the increase due to immigration (U.S. Bureau of the Census, 1975). The estimated GNP for the period also doubled, although the distribution of wealth grew increasingly less equitable. Immigration continued to increase steadily until around 1920, but the economic expansion came to a dramatic halt with the Panic of 1893, a severe economic depression that lasted until 1897.

1. Urbanization
2. Immigration
3. Machine Politics and Corruption
4. Inventors and Entrepreneurs
5. Business Growth and Regulation
6. The Emergence of the Labor Movement

I. Urbanization

The growth of urban areas after the Civil War was unprecedented. New immigrants flocked to U.S. cities in record numbers and Americans from small towns also headed to the cities in search of better jobs. The population of urban areas nearly tripled in the last three decades of the nineteenth century, with over one-third of the U.S. population living in cities (U.S. Bureau of the Census, 1975). The infrastructure of the cities was simply unprepared for such rapid growth and conditions deteriorated. Suburbs emerged as the middle class opted to live outside the city limits—close enough to enjoy the benefits of the city, but away from the squalor and poverty that plagued the densely inhabited areas.

There was, of course, another side to the city. The infrastructure of New York City, like that of other major cities, was ill-equipped to handle the millions of people who flooded in looking for a better life. Factories were in the cities in most cases, and few people could afford public transportation, so they had to live in the city in order to walk to work. As a result, apartment complexes called dumbbell tenements sprang up around the factories, crowding hundreds of people into tiny spaces, with few windows and little ventilation. (Click on the thumbnail Multimedia: Tenement Life | Multimedia transcript.) The best tenements featured a communal bathroom on each floor, while others required residents to use an outhouse. The sanitation systems could not keep pace and trash piled up along the streets. The few health and safety laws that existed were seldom enforced, and disease was rampant. Gangs of youths who couldn’t find jobs turned to pick-pocketing and more serious crime. Murder rates skyrocketed and many long-time city residents fled to the suburbs, coming into the city for work and recreation. Those who remained as residents of the city were mostly poor or recent immigrants who had no choice.

II. Immigration

Nearly ten million immigrants came to the United States during the Gilded Age (U.S. Bureau of the Census, 1975). Some came in search of religious or political freedom, but many more were lured from around the world by stories of the gold rush. Few literally believed that the streets in America were paved in gold, but they embraced the idea that an enterprising soul could make his or her fortune with relative ease. These immigrants arrived in the major cities on the East and West coasts and a good percentage of them did not venture further.

Prior to 1880, most immigrants to America were from western Europe, but this begins to shift in the last decades of the century. A growing number of immigrants arrived from southern and eastern Europe, where political and economic conditions were poor. Unlike earlier immigrants, there were greater cultural and religious differences, and a larger percentage of the newcomers arrived with little or no money. Most of the immigrants settled in the cities, seeking factory work, and they usually chose to live in neighborhoods populated by others from their homeland. These ethnic neighborhoods allowed the new immigrants to adjust more easily to their new surroundings, but they also made assimilation more difficult.

Ellis Island was constructed in 1892 to handle the surge in foreign arrivals. Those with contagious illnesses were turned away, but that was the only exception. The caption on the Statue of Liberty, a gift from France in 1886, wasn’t an exaggeration in this era, and the “huddled masses, yearning to breathe free” poured into New York City and other eastern cities.

Open immigration policies did not apply to Chinese immigrants, however. The 1850 census recorded 748 persons of Chinese origin in the United States (U.S. Bureau of the Census, 1975). In 1868, the U.S. granted China most-favored nation status, and actively recruited Chinese workers as laborers on the Transcontinental Railroad. The timing coincided with a period of economic and political turmoil in China, and by 1880, the census recorded approximately 100,000 Chinese, with about three-quarters living in California (ibid). The rate of growth alarmed both business and political leaders, resulting in the Chinese Exclusion Act of 1882, which banned virtually all Chinese immigration into the country. This Act was periodically renewed, and was not lifted until 1943.

Other examples of nativism and xenophobia grew during the Gilded Age, as well. Many native-born Americans saw the newcomers as economic and cultural threats. (Click on the thumbnail Multimedia: Reaction to Immigration | Multimedia transcript.) Birthrates were high among the new immigrants, and some were concerned that American bloodlines might be corrupted through intermarriage with “lesser” people. Other fears were purely economic. The new immigrants were willing to work for lower wages than native workers and some factories took advantage of this by employing immigrants as strike breakers. Nativist organizations grew during the Gilded Age, especially as the economy declined, and they began to push for legislation to restrict immigration. Their attempts would not be successful, however, until 1917.

III. Machine Politics and Corruption

Corruption was rampant in the Gilded Age, in all levels of government. (Click on the thumbnail Multimedia: Grant Era Scandals | Multimedia transcript.) Cities were often run under a system of machine politics, with a few powerful individuals determining who received public jobs and contracts. Corruption was also a major issue in the business world, largely because there were few laws to constrain the ambitious and unethical. Corporations developed numerous schemes for enriching the owners at the expense of workers and stockholders. One of the most devious was the “interlocking directorate,” where a single board of directors oversaw two companies and would bankrupt one company by transferring assets to the other. This technique was used by Union Pacific Railroad during the construction of the Transcontinental Railroad. Union Pacific directors created a separate company, Crédit Mobilier, to supply workers and construction materials and then diverted profits to that company, at the expense of Union Pacific stockholders. The directors attempted to cover up the scheme, bribing several congressmen and the vice-president Schuyler Colfax, but were eventually exposed by newspaper reporting during the 1872 presidential campaign.

The “spoils system” also contributed to the corruption of the era. Based on the adage “to the victor go the spoils,” government jobs were distributed to family members (nepotism) and to friends and supporters (patronage), rather than on the basis of merit. Political appointments still occur today, but in the 1870s it was the system for determining all government jobs. The Republican Party, which controlled the White House after 1868 was split over the issue of civil service reform, until the country faced a tragedy that was directly connected to the problems of the spoils system. President James Garfield was elected in 1880, but killed only six months later by Charles Guiteau, who was angry that he did not receive a government position from Garfield. The next president, Chester Arthur, established a Civil Service Commission. Although it initially covered only about ten percent of government positions, it grew over time to include most government jobs.

IV. Inventors and Entrepreneurs

The Gilded Age is also referred to by some as the “second Industrial Revolution,” and by the mid-1890s, the United States was the top manufacturing country in the world. This was due in part to the discovery of additional natural resources, but also to investments in the nation’s infrastructure, such as the railroads and a growing network of canals. In addition, the manufacturing sector embraced the mass production techniques of Eli Whitney and moved toward mechanizing many aspects of industrial labor. A steady supply of cheap labor due to immigration was an added bonus, and the government lent a hand by keeping tariffs high, thus limiting foreign competition in the market.

Innovation was also an important element in economic growth. (Click on the thumbnail Multimedia: Inventors and Inventions.) The Patent Office was swamped with over 400,000 applications between 1860 and 1890 (U.S. Bureau of the Census, 1975). Many of these inventions were vitally important in the twentieth century, including Alexander Graham Bell’s telephone and Thomas Edison’s electric light bulb, phonograph, and motion-picture technology. The typewriter and cash register helped to open up a wider array of jobs for women and commuter rail allowed more people to work in the cities but live in the suburbs that were emerging around most major cities.

Inventive minds helped to launch much of the growth in this era, but businesses also required investment of capital. The government maintained a laissez faire position toward business, which allowed a few leaders to dominate in various industries like steel, oil, and transportation. John D. Rockefeller, Cornelius Vanderbilt, and Andrew Carnegie were the most prominent industrialists of the era. Known for their lavish lifestyles and for their philanthropy, none were friends of the labor movement.

The rags-to-riches stories that were popularized in this era by writers like Horatio Alger suggest that most of these leaders rose up from poverty, but that was true of only about ten percent of the wealthiest industrialists of the Gilded Age (Weir 2000). The rest of the multimillionaires were from middle or upper class backgrounds. The idea that one could rise from being a bootblack to a “Captain of Commerce” did, however, play an important role in limiting worker complaints and in justifying a system where just a few individuals controlled much of the nation’s wealth.

V. Business Growth and Regulation

The huge gap between the rich and the poor was a growing source of concern for reformers in the late 1800s. Some worried that this concentration of power in the hands of a few could eventually erode our system of government, and there was some valid reason for concern. There were others, among the middle and upper class, who were alarmed at the rise of violent strikes and feared that these class divisions would increase and threaten the stability of the nation.

To support their position, wealthy industrialists used the doctrine of Social Darwinism, a view that holds that the individuals in society struggle for existence based on the “survival of the fittest,” where those who acquired wealth were “fit” while those who did not were the “unfit.” The theory argued against social assistance and supported laissez-faire capitalism. Darwin’s On the Origin of Species was first published in 1859, and while his argument dealt specifically with biological selection, others were quick to apply it to the economic system and society in general. Herbert Spencer argued that Darwin’s theory helped to explain why small businesses were inevitably—and rightly—put out of business by monopolies and trusts. William Graham Sumner claim that the existence of the wealthy class was due to natural selection. Others, like Andrew Carnegie, did not take it to quite that extreme, but he wrote in 1889 that disparities in income were not just inevitable, but evidence of the advancement of the human race (Hutchinson 2004, 88-89). (Click on the thumbnail Multimedia: The Gospel of Wealth | Multimedia transcript.)

Despite the fact that these views were pushed in popular culture, the working class and rural farmers were not so easy to convince. The pervasive corruption that they saw among business and government leaders contributed to a growing sense that some degree of business regulation was required. In 1887, Congress passed the Interstate Commerce Act, which regulated railroad fees and required that companies publish their rate and set up the Interstate Commerce Commission (ICC) to ensure that regulations were followed and to control abuses of power and discrimination by the railroads. The importance of the act went beyond the railroads, however, as it established a precedent for government regulation of any business that engaged in interstate trade. Another major piece of legislation was the Sherman Anti-Trust Act of 1890, which aimed to prevent monopolies and ensure open competition in order to protect companies from each other and to protect American consumers from unfair business practices. The act was not well-enforced, however, and actually worked against the interests of laborers, as it was often used to restrict efforts to form labor unions.

VI. The Emergence of the Labor Movement

Wealth increased at a rapid pace in the Gilded Age, but it was concentrated in the hands of only a few. Ten percent of Americans controlled three-quarters of the nation’s wealth at the turn of the century (Bagwell and Mingay 1987, 220). Workers were mostly unskilled and they were generally viewed as expendable. A sixty-hour work week was common and wages were rarely adequate to support a family. As a result, child labor was common. The working conditions in factories were unhealthy, but there were no laws to protect workers. Efforts to unionize were frequently blocked by employers and if government interceded, it was generally on behalf of the owners, not to protect the rights of workers.

Entire communities and towns, such as McDonald, Ohio, and the Pullman area of Chicago, were owned by companies. These companies controlled the stores and apartment buildings and kept workers in debt so that they could not afford to leave, even if conditions were poor and wages decreased. The steady stream of immigrants enabled employers to blacklist those who complained because there were always other workers willing to take their jobs.

Prior to the Civil War, workers made few attempts to unionize. There were scattered strikes for better pay and working conditions, however, and these increased as the country became more industrialized. In the 1860s and early 1870s, dozens of national craft unions were formed. In 1863, the first railroad union, the Brotherhood of Locomotive Engineers, was created and others would soon follow. The short-lived National Labor Union (1866-1872) attempted to unite a variety of labor unions at the nation level, and quickly grew to over half a million members (Northrup 2005). The insistence of the Union’s leaders that political action was necessary in order to obtain key goals such as the eight-hour day alienated many members, however, and the organization did not survive the economic downturn in 1872.

Labor agitation and unrest were widespread throughout the 1870s due to the depression. Workers joined together to strike against wage cuts and layoffs, as factors increased the use of labor-saving machines. Factory owners opposed unionization and often used force to prevent it. The Molly Maguires, a secret group that operated in the coal mines of Pennsylvania, reportedly used tactics of intimidation and violence to improve working conditions. When railroad workers on the Baltimore and Ohio (B&O) line went on strike in 1877 in West Virginia, the movement quickly spread to other states and other railroads. (Click on the thumbnail Multimedia: Major Strikes of the Gilded Age | Multimedia transcript.) Local and state militias were unable to restore order during the forty-five day strike, and federal troops were called in. Over 100 people were killed but there were no real gains for the workers (Zinn 2003). They gradually returned to their jobs, but the experience was important in pushing many toward backing third parties like the Workingmen’s Party in the 1880s, which offered greater support for worker’s rights.

The American Federation of Labor (AFL) was formed in 1886 in Chicago, with an initial membership of around 316,000 workers from 25 national unions. By 1920, the total membership would exceed four million (Northrup 2005). The AFL was a confederation of independent unions, each of which retained the right to negotiate with workers and employers in that field. The AFL focused on skilled workers and specific goals, such as reductions in work hours and increased pay. Taking a lesson from the failed National Labor Union, they avoided political entanglements and simply urged members to vote for candidates that supported their goals, regardless of political party.

Despite some successes in the late 1800s, labor unions grew slowly, due both to a lack of public support and the direct opposition of government and industry. The severe depression of the 1890s also curbed union growth, as did several violent clashes between unions and management. The first was the Homestead Strike of 1892, followed two years later by the Pullman Strike between the American Railway Union and the Pullman Palace Car Company. In both cases, the federal government played a central role in putting down the strike. Although the public was not fond of strikes that disrupted their lives, incidents such as these raised public awareness and attitudes began to shift toward worker’s rights in the Progressive Era.

References

Bagwell, Philip Sidney, and G. E. Mingay. 1987. Britain and America 1850-1939: A study of economic change. New York: Routledge.

Hutchinson, William R. 2004. Religious pluralism in America: The contentious history of a founding ideal. New Haven, CT: Yale University Press.

Northrup, Cynthia Clark. 2005. The American economy: A historical encyclopedia. Santa Barbara, CA: ABC-Clio.

U.S. Bureau of the Census. 1975. Historical statistics of the United States, colonial times to 1970, bicentennial edition, parts 1 and 2. Washington, DC: U.S. Government Printing Office.

Weir, Robert E. 2000. Knights unhorsed: Internal conflict in a Gilded Age social movement. Detroit, MI: Wayne State University Press.

Zinn, Howard. 2003. A people’s history of the United States. New York: Harper Collins.

Image Credit

Keppler, Joseph F. “Mark Twain.” Illustration. Puck, December 16, 1885, 256. From Library of Congress Prints and Photographs Online Catalog http://hdl.loc.gov/loc.pnp/cph.3g04294 (accessed December 1, 2008). Book cover: Twain, Mark, and Charles Dudley Warner. 1873. The Gilded Age: A tale of to-day. Hartford, CT: American Publishing Co.

Return to top of page

Report broken links or any other problems on this page. Copyright © by University of Maryland University College.