6.6 Gilded Age Interpretation Assignment

Vanderbilt, Carnegie, Rockefeller, and others are often remembered as monopolists, yet they radically lowered prices. As early entrants into their markets, they fought their way through chaotic competition by strictly controlling costs and increasing efficiency at every step. By making transportation, steel, and oil far cheaper and more widely available, they contributed to the rapid growth of the American economy, and the creation of tremendous wealth.

Not everyone was happy with these developments. The rise of large companies also gave rise to a new class of lifelong wage workers (by contrast with earlier generations, which had anticipated owning their farms or shops). Unionization and strikes increased rapidly after the Civil War. Starting in the 1870s, workers demanded laws to limit the workday to eight hours.

Farmers, too, felt helpless before the railroads—"the greatest and most powerful monopoly on the face of the earth," in the words of one orator. "They let the public feel their power in the fuel of their kitchens, the bread of their bodies, the material for their houses." Cheaper transportation integrated the national marketplace, putting farmers in distant regions into direct competition with each other. And railroads gave discounts to large, long distance shippers; farmers who sent their harvest and livestock over short distances to local markets resented paying a higher rate per mile.

As with workers’ demands for eight-hour laws, agrarian radicals wanted government action. One council of Grangers declared, "We hold that a state cannot create a corporation that it cannot thereafter control." Another speaker said, "The time would come when the management of the roads must fall into the hands of the public."

This call for public regulation, even ownership, marks a major shift in politics. Gone were the days when Jacksonian radicals wanted the government to stay out of the economy, to allow individuals to rise on their merits. Now those on the left embraced government intervention as a means of countering the new power of large corporations, which towered over the economy as no businesses had before the Civil War.

It took decades for this kind of regulation—especially federal regulation—to emerge. Yet even before the death of Cornelius Vanderbilt in January 1877, the modern argument over private enterprise and the role of government had clearly emerged. In a sense, it does not matter whether one sees Vanderbilt and his peers as robber barons or captains of industry; it is the fact that we argue about them as one or the other that matters most. They not only changed the way we live—they changed the way we think.