Economic

• Populism, Progressivism, and Imperialism (1890-1920)


  • Agricultural reforms
  • Graduated income tax
  • Gov ownership of railroads
  • Bimetallic currency- silver coins as readily available as gold
• Some historians view Populists as forward looking liberal reformers, others view them as reactionaries trying to recapture idyllic, utopian past based on farming
• Capital investment in manufacturing


  Increased from $1 billion to $10 billion by 1900 & value of manufacturing grew from $2 billion to $13 billion
• In 1914, the US was producing 33% of the world's manufactured goods
• Technical growth


  In 1890, there were 440,000 patents for new products and processes, e.g. Bessemer Converter= sped up steel production for development of railroad tracks, skyscrapers, ploughs, bridges etc
• In 1900, there were 8000 car owners, but only the rich could afford them
• In 1888, New York alone had more telephones than the whole of the UK & 100,000 Americans purchased cameras
• Improved communications


  More fresh food through railroad communication centres= improved diets of city dwellers= improved production methods
• Value of silver


  $156,000 in 1860 grew to $57 million by 1890
• Populists felt the high value of gold led to high interest rates & shortage of credit, and maintaining the gold standard was the same as the Bank of England only acting in its own interests/ excluding other groups
• In 1890, the Sherman Silver Purchase Act was passed, which required the government to purchase 4,500,000 ounces of silver per month, but it was repealed by Cleveland in 1893
• Wheat prices fell from $1.60 a bushel in 1860 to 60 cents by 1890, and cotton fell from 30 cents a bushel to 6 cents
• High tariffs on foreign goods meant foreigners wouldn't buy US agricultural products, increasing competition for European markets, e.g. Australia, Russia and Canada
• In the late 1880s, harvests deteriorated due to poor weather conditions
• Southern and western farmers didn't share in the prosperity and expansion experienced by industry, and objected to the power of bankers and corporations
• Traditionally self-sufficient farmers, falling agricultural prices meant they had to rely on loans to pay for higher prices charged for grain storage and transportation, leaving them with less income to repay the loans, which they blamed on the railroads and bankers
• Farmers Alliances promoted unity through co-operation & mutual self-respect, and supported Populists and Democrats in the presidential election of 1896
• Iron production


  Increased from 920,000 tons in 1860 to 10.3 million tons by 1900
• Pittsburgh was the centre of the iron industry, highly centralised with 38 steel plants along 42km of navigable rivers
• In 1901, the success of the Lucas Well in Texas marked the beginning of modern oil production, producing 70,000-110,000 barrels per day before being capped, and further 'gushes' were discovered, with Oklahoma becoming the leading oil producer by 1907, producing 25% of the nation's oil 6 years later
• Trusts and monopolies continued to develop, with the largest 4% of US companies producing 57% of total industry in 1904, and 319 major consolidations occurring between 1898-1902, e.g. DuPont controlled 85% of the nation's electric power, and Carnegie Steel Corporation was sold to J.P. Morgan and renamed US Steel, becoming the world's first billion-dollar corporation
• The Depression of 1893


  • Stock market crash: Reading Railroad declared bankruptcy= 'Industrial Black Friday'
  • 24 businesses failed per day in May alone
  • 4 year depression: 15,00 companies and 600 banks closed= national unemployment rate approached 20%
  • NY unemployment reached 35%
  • Soup kitchens opened to feed destitute
• Cleveland took a laissez-faire approach, believing the business cycle was a natural occurrence and politicians shouldn't interfere, and supported a sound monetary system based on gold, which helped boost business confidence and gradually stemmed unemployment after the repeal of the Silver Purchase Act
• The crisis of the Depression alienated many from the economy and political process, and the effects lasted until 1897, with the bankruptcies leading to an upsurge in business consolidations, leaving the poor feeling ignored and at the mercy of trusts, contributing to the rise of Progressivism
• American Federation of Labour


  Represented labour unions & encouraged mutual support for better working conditions & better wages through strike action
• In 1886, there were 1,400 strikes involving 500,000 members
• Employers were hostile to unions, sacking striking workers who joined trade unions and using blackleg labour to break strikes
• The Pittsburgh Steelworkers' strike of 1892 ended in defeat for the union, with the company calling in the militia, armed with rifles and machine guns, to attack the strikers, setting back union power considerably
• The Pullman Strike of 1894 was the first national strike, paralyzing the railway system, but ended in failure, with Cleveland siding with the railway owners and sending in troops to keep the trains running, killing 4 people, and the Omnibus Indictment Act being used against the union to permit legal banning of strikes, remaining in force until the 1930s
• The government's hostility to unions and willingness to shoot its own citizens contributed to the Populist Party gaining support
• Many immigrants were welcomed by employers as cheap and willing labour, with over a quarter of immigrants existing below subsistence level by 1900, and their wives and children having to work too
• Agents efficiently matched immigrants to jobs, with most having employment within a few hours of arrival, providing an unskilled workforce for rapidly growing industries
• By 1920, the US was the world's leading industrial nation, partly due to the impact of World War I, as the US economy benefited greatly from the war while the economies of other leading countries were badly affected
• During World War I, the US took over from Germany as the world's leading producer of fertilizers and chemicals, and the war stimulated technological advancements, particularly in mechanization, with the US leading the world in new technology
• By 1920, the US produced and consumed 70% of the world's oil and was the leading producer of coal and steel, with the Great Plains supplying nearly a quarter of the world's wheat and over two-thirds of its corn
• While the US was a wealthy country with a higher standard of living for many American families than their European counterparts, wealth was unevenly distributed, with millions not sharing in the nation's prosperity, and industrial workers at the mercy of large business corporations that refused them any negotiating rights over working hours or pay, forcing many to live in slum areas, while small farmers faced financial difficulties competing with larger agricultural enterprises and foreign competition