Industrial Expansion 1860-1890


Postwar industrial expansion, partly a result of the railroad network, rapidly began to assume gigantic proportions. When Lincoln was elected in 1860, the Republic ranked only fourth among the manufacturing nations of the world. By 1894 it had bounded into first place. Why the sudden upsurge?

Liquid capital, previously scarce, was now becoming abundant. The word millionaire had not been coined until the 1840s, and in 1861 only a handful of individuals were in this class. But the Civil War, partly through profiteering, created immense fortunes; and these accumulations could now be combined with the customary borrowings from foreign capitalists.

The amazing natural resources of the nation were now about to be fully exploited, including coal, oil, and iron. For example, the Minnesota-Lake Superior region, which had yielded some iron ore by the 1850s, contributed the rich deposits of the Mesabi Range by the 1890s. This priceless bonanza, where mountains of red-rusted ore could be scooped up by steam shovels, ultimately became a cornerstone of a vast steel empire.

Unskilled labor, both homegrown and imported, was now cheap and plentiful. Steel, the keystone industry, came to be based largely on the sweat of low-priced immigrant labor, working in two twelve-hour shifts, seven days a week.

American ingenuity at the same time played a vital role in the second American industrial revolution. Techniques of mass production, pioneered by Eli Whitney, were being perfected by the captains of industry. American inventiveness flowered luxuriantly in the postwar years: between 1860 and 1890 some 440,000 patents were issued. Business operations were facilitated by such machines as the cash register, the stock ticker, and the typewriter ("literary piano"), which attracted home-confined women to industry. Urbanization was speeded by the refrigerator car, the electric dynamo, and the electric railway, which displaced animal-drawn cars.

One of the most ingenious inventions was the telephone, introduced by Alexander Graham Bell in 1876. A teacher of the deaf who was given a dead man's ear to experiment with, he remarked that if he could make the mute talk, he could make iron speak. America was speedily turned into a nation of "telephoniacs," as a gigantic communication network was built on his invention. The social impact of this instrument was further revealed when an additional army of "number please" women was attracted from the home into industry. Telephone boys were at first employed at switchboards, but their profanity shocked patrons.

The most versatile inventor of all was Thomas A. Edison, who as a boy had been considered so dull-witted that he was taken out of school. This "Wizard of the Wires" ran a veritable invention factory in New Jersey. He is perhaps best known for his perfection in 1879 of the electric light, which he unveiled after trying some six thousand filaments. So deaf that he was not easily distracted, he displayed sleepless energy and a flair for practical money-making schemes rather than pure science. He invented, perfected, or did useful exploratory work on the phonograph, the mimeograph, the dictaphone, and the moving picture. "Genius," he said, "is one percent inspiration and ninety-nine percent perspiration.""


Steel is king!" might well have been the exultant war cry of the new industrialized generation. The mighty metal ultimately held together the new steel civilization, from skyscrapers to coal scuttles, while providing it with food, shelter, and transportation. Steel making, notably rails for railroads, typified the dominance of "heavy industry," which concentrated on making "capital goods," as distinct from the production of "consumer goods" such as clothes and shoes.

Now taken for granted, steel was a scarce commodity in the wood-and-brick America of Abraham Lincoln. Considerable iron went into railroad rails and bridges, but steel was expensive and was used largely for products like cutlery. The early iron horse snorted exclusively (and dangerously) over iron rails; and when in the 1870s "Commodore" Vanderbilt of the New York Central began to use steel rails, he was forced to import them from England.

Yet within an amazing twenty years, the United States had outdistanced all foreign competitors and was pouring out more than one-third of the world's supply of steel. By 1900 the Americans were producing as much as England and Germany combined.

What wrought the transformation? Chiefly the invention in the 1850s of a method of making cheap steel--the Bessemer process. It was named after a derided British inventor, although an American had stumbled on it a few years earlier. William Kelly, a Kentucky manufacturer of iron kettles, discovered that cold air blown on red-hot iron caused the metal to become white-hot by igniting the carbon and thus eliminating impurities. He tried to apply the new "air boiling" technique to his own product, but his customers decried "Kelly's fool steel," and his business declined. Gradually the Bessemer-Kelly process won acceptance, and these two "crazy men" ultimately made possible the present steel civilization.

A revolutionary steel-fabricating process was not the whole story. America was one of the few places in the world where one could find relatively close together abundant coal for fuel, rich iron ore for smelting, and other essential ingredients for making steel. The nation also boasted an abundant labor supply, guided by industrial know-how of a high order. The stage was set for miracles of production."


"Monarchs of yore invoked the divine right of kings, and America's industrial plutocrats took a somewhat similar stance. Some candidly credited heavenly help, and the body of ideas with which they justified their social position came to be known as the "Gospel of Wealth." "Godliness is in league with riches," preached the Episcopal bishop of Massachusetts, and hardfisted John D. Rockefeller piously acknowledged that "the good Lord gave me my money." But most defenders of wide-open capitalism relied more heavily on the survival-of-the-fittest theories of Charles Darwin. "The millionaires are a product of natural selection," concluded Yale Professor William Graham Sumner. "They get high wages and live in luxury, but the bargain is a good one for society." Despite plutocracy and deepening class divisions, the captains of industry provided material progress.

Self-justification by the wealthy inevitably involved contempt for the poor. Many of the rich, especially the newly rich, had pulled themselves up by their own bootstraps; hence they concluded that those who stayed poor must be lazy and lacking in enterprise. The Reverend Russell Conwell of Philadelphia became rich by delivering his lecture "Acres of Diamonds" thousands of times. In it he said, "There is not a poor person in the United States who was not made poor by his own shortcomings." Such attitudes were a formidable roadblock to social reform.

Plutocracy, like the earlier slavocracy, took its stand firmly on the Constitution. The clause that gave Congress sole jurisdiction over interstate commerce was a godsend to the monopolists; their high-priced lawyers used it time and again to thwart controls by the state legislatures. Giant trusts likewise sought refuge behind the Fourteenth Amendment, which had been originally designed to protect the rights of the ex-slaves as persons. The courts ingeniously interpreted a corporation to be a legal "person" and decreed that, as such, it could not be deprived of its property by a state without "due process of law" (see Amendment XIV, para. 1). There is some questionable evidence that slippery corporation lawyers deliberately inserted this loophole when the Fourteenth Amendment was being fashioned in 1866.

Great industrialists likewise sought to incorporate in "easy states," like New Jersey, where the restrictions on big business were mild or nonexistent. For example, the Southern Pacific Railroad, with much of its trackage in California, was incorporated in Kentucky."


"Economic miracles wrought during the decades after the Civil War enormously increased the wealth of the Republic. The standard of living rose sharply, and well-fed American workers enjoyed more physical comforts than their counterparts in any other industrial nation. Urban centers mushroomed as the insatiable factories demanded more American labor and as immigrants swarmed like honeybees to the new jobs.

Early Jeffersonian ideals were withering before the smudgy blasts from the smokestacks. As agriculture declined in relation to manufacturing, America could no longer aspire to be a nation of small freehold farms. Jefferson's concepts of free enterprise, with neither help nor hindrance from Washington, were being thrown out the factory window. Tariffs had already provided assistance, but the long arm of federal authority was now committed to decades of corporation curbing and "trust-busting."

Older ways of life also wilted in the heat of the factory furnaces. The very concept of time was revolutionized. Rural American migrants and peasant European immigrants, used to living by the languid clock of nature, now had to regiment their lives by the factory whistle. The seemingly arbitrary discipline of industrial labor did not come easily and sometimes had to be forcibly taught. One large corporation simultaneously instructed its Polish immigrant workers in the English language and in the obligations of factory work schedules:


I hear the whistle. I must hurry.

I hear the five-minute whistle.

It is time to go into the shop. ...

I change my clothes and get ready to work.

The starting whistle blows.

I eat my lunch.

It is forbidden to eat until then. ...

I work until the whistle blows to quit.

I leave my place nice and clean.

I put all my clothes in the locker.

I must go home.


Probably no single group was more profoundly affected by the new industrial age than women. Sucked into industry by recent inventions, chiefly the typewriter and the telephone switchboard, millions of stenographers and "hello girls" achieved a new economic and social independence. Careers for women also meant delayed marriages and smaller families.

The clattering machine age likewise accentuated class division. "Industrial buccaneers" flaunted bloated fortunes, and their rags-to-riches spouses displayed glittering diamonds. Such extravagances evoked bitter criticism. Some of it was envious, but much of it rose from the small and increasingly vocal group of socialists and other radicals, many of whom were recent European immigrants. The existence of an oligarchy of money was amply demonstrated by the fact that by 1900 about one-tenth of the people owned and controlled nine-tenths of the nation's wealth.

A nation of farmers and independent producers was becoming a nation of wage earners. In 1860 half of all workers were self-employed; by the century's end, two of every three working Americans depended on wages. Real wages were rising, and times were good for workers who were working. But with dependence on wages came vulnerability to the swings of the economy and the whims of the employer. The fear of unemployment was never distant. A breadwinner's illness could mean catastrophe for an entire family. Nothing more sharply defined the growing difference between working-class and middle-class conditions of life than the precariousness of the laborer's lot. Reformers struggled to introduce a measure of security--job and wage protection, and provision for temporary unemployment--into the lives of the working class.

Finally, strong pressures for foreign trade developed as the tireless industrial machine threatened to flood the domestic market. American products radiated out all over the world--notably the five-gallon kerosene can of the Standard Oil Company. The flag follows trade, and empire tends to follow the flag--a harsh lesson that America was soon to learn."


The American Pageant

Chapter 26.16

The Impact of the New Industrial Revolution on America


The American Pageant

Chapter 26.13

The Gospel of Wealth


The American Pageant

Chapter 26.10

The Supremacy of Steel


The American Pageant

Chapter 26.8

Miracles of Mechanization