Let’s travel back to 1919 when 2 million soldiers returned to celebrate World War I’s victory.
As the war veterans march, a cheering crowd of optimistic Americans can be heard for miles in Madison Square Garden. They are nestled in the world’s largest financial market, considered the beating heart of American capitalism- filled with pride and optimism. In retrospect, I wonder if they would have approached the matter differently if they had known veterans, bankers, and hell…the whole country was in for an unpleasant surprise on that cheerful day.
There is a lot of talk about the Gilded Age. Every generation believes they are ushering in a new Gilded Age that is better than the previous one. It took me quite a bit of time to research what the end of the Civil War to the end of World War I meant for Americans, and I do not know if the analogy of the Gilded Age is something I would like to have repeated.
However, to those living during that brief period- I am sure it all seemed very Gatsby-like. Or was it? Social media, films, and books paint a glitzy picture of luxurious clothing, outlandish parties, and overall freedom to spend without worrying about what was sitting in the bank account.
But what did Mark Twain say? It was glittering on the outside but corrupt on the inside? Not really a pretty picture- no matter how many themed parties we throw.
I consider the last shreds of golden fabric to have been whisked away when those service members walked through Madison Square Garden. Any hope to return to the late 1800s after such a brutal war was as far-fetched as an Alice in Wonderland story. The pictures invoke a sense of financial security, freedom to work hard and play harder, and confidence in our national security.
And yet, just 25 years earlier, this country was facing its most significant depression. It was a time when thousands of Americans went to bed hungry, children lacked proper clothing or shoes, education was nonexistent, and big businesses used the concept of ‘The American Dream’ to justify their inhumane treatment.
Discover what life was like for most people in the Gilded Age as we journey along the road of a parallel story.
Panic of 1893:
In February 1893, the Philadelphia and Reading railroads collapsed. In return for their numerous investments, the railroads had hired thousands of workers to build more and more lines, creating a financial bubble in America. Many American families relied on good-paying jobs with railroads to support themselves and their families, and farmers benefited from the ability to ship their products nationwide. When the railroad announced that it would be entering into receivership, it created what Matthew Josephson in The Robber Barons called a “rich man’s panic.”
However, a second player emerges from the left stage simultaneously- The National Cordage Company.
It was the nation’s leading producer of rope and twine. This was a company that was started as a group of rope manufacturers that quickly formed an efficient trade association that grew into the trust and corporation called the National Cordage Company. Within three years, it had control over 40% of the nation’s rope and twine production. By 1892, it controlled almost 90% of the nation’s cordage mills. The financial press hailed it as a rising giant in the American industrial field.
Fairy tales teach us that the giant never wins.
Overtrusting management and using natural fibers only available in certain seasons led to the company’s failure. As the National Cordage Company bought out competitors, the smaller companies agreed to permanently exit the field through a handshake, not a legal agreement. Red flag #1.
This, coupled with the fact that the materials needed to produce baler twine, which was four-fifths of its production, were only available during harvest seasons, the company borrowed a large amount of capital to sustain it. Red flag #2.
However, the company announced early in 1893 that it would offer a 100% stock dividend in addition to a 10% per annum payable to its investors. Red flag #3.
It was announced within weeks that the company was filing for receivership. Within a few months, the company’s stock plummeted from $138.00 to $20.00.
May 1893- the New York Stock Exchange collapsed. A terrible depression fell over the country. Crop prices fell, wages dropped, 25,000 businesses declared bankruptcy, and unemployment raised to almost 19%.
To many, the Gilded Age was a memory of standing in unemployment and bread lines, praying for the same big businesses who caused the mess to help fix it. They never came.
According to legend, the power lies in the pen and the brave. In the early 1900s, a few journalists thought articles on parties, openings, and the latest fashion were irrelevant during the Gilded Age. Known as Muckrakers, they exposed injustices in America through their work.
“Tweed Days in St. Louis” (1902) was an article written by Lincoln Steffens in McClure’s magazine that depicted how big businesses were working with officials to maintain power within the city while simultaneously draining the public treasury.
The city’s money was loaned at interest, and the interest was converted into private bank accounts. City carriages were used by the wives and children of city officials. Supplies for public institutions found their way to private tables; one itemized account of food furnished the poorhouse included California jellies, imported cheeses, and French wines! A member of the Assembly caused the incorporation of a grocery company, with his sons and daughters the ostensible stockholders, and succeeded in having his bid for city supplies accepted although the figures were in excess of his competitors’. In return for the favor thus shown, he endorsed a measure to award the contract for city printing to another member, and these two voted aye on a bill granting to a third the exclusive right to furnish city dispensaries with drugs.Lincoln Steffens Exposes “Tweed Days in St. Louis”
When Ida Tarbell’s father was driven out of business by the Rockerfellers, she wrote “History of Standard Oil Company” for McClure. Years of research enabled Ida to discover the illegal means John D. Rockefeller employed during the early days of the oil industry. In addition to damaging internal documents, former employees were willing to share. With Mark Twain’s help, she met with Henry H. Rogers, a senior executive at the time who ‘sealed the deal.’
John Spargo wrote a gut-wrenching article entitled “The Bitter Cry of the Children” in 1906, which detailed the working conditions of children in America. Children in the workforce were not unheard of as they were considered ideal in mines or factories where they could squeeze into areas that a normal adult could not.
I met one little fellow ten years old in Mt. Carbon, W. Va., last year, who was employed as a “trap boy.” Think of what it means to be a trap boy at ten years of age. It means tosit alone in a dark mine passage hour after hour, with no human soul near; to see no living creature except the mules as they pass with their loads, or a rat or two seeking to share one‟s meal; to stand in water or mud that covers the ankles, chilled to the marrow by the cold draughts that rush in when you open the trap door for the mules to pass through; to work for fourteen hours—waiting—opening and shutting a door—then waiting again for sixty cents; to reach the surface when all is wrapped in the mantle of night, and to fall to the earth exhausted and have to be carried away to the nearest “shack” to be revived before it is possible to walk to the farther shack called “home.”John Spargo’s The Bitter Cry of the Children, 1906
Progressive Era Reforms:
Although much is to be said about the industrial age and the ability to chase ‘The American Dream,’ the Gilded Age was characterized by the concentration of wealth among a small group of elite people. It is estimated that manufacturing production rose by over 800% during this period; however, the profits were primarily enjoyed by 1% of the population.
It has been claimed that the assassination of President William McKinley in 1901 finalized the end of the Gilded Age. His Vice-President, Theodore Roosevelt, was a strong, opinionated, untiring person who believed in a ‘square deal’ for everyone. A prime example is the Meat Inspection Act and the Pure Food and Drug Act which ensured that wealthy businesses were not profiting at the expense of public health. However, there were many social changes during this period: labor unions, birth control acts, tax reforms, election reforms, and increased conservation efforts.
By 1916, it seems that the country had policed itself up. The cities were cleaner, the public was healthier, the jobs were safer, and wages covered expenses. At this point, the average American could pursue their own ‘American Dream.’
The wealthy were still rich and would be for generations until they squandered their fortunes away. However, the corruption had been exposed for the nation to see, and they had to answer for their crimes. Their blinders were now off, as the world saw the photos and stories showing how the ‘greatest country’ could not even feed or house its citizens.
I think we have assumed the Gilded Age was one massive Gatsby party for everyone because the period has been polished and rewritten so many times. The reality is that it was not a pleasant time for 99% of the American population, so before we romanticize this era, consider if you would want to be one of them? Because chances are- you would have been.
As always my friends, I invite you to do more research on the topic yourself to dive deeper into the end of the Gilded Age and the Progressive Era reforms and what their impact is on our society today.
And remember…Be Great at something you are Good at!
For further research or reading I have included a link to some books that you might enjoy…. Click here!