Lesson 16: Mechanization
We have already discussed many things that happened during the period of Mechanization. Typically, this period covers the 1880s and 1890s. It was the time period when we begin to replace the things we do by hand with machines, particularly in the workplace and the home. This wasn't just in the cities either. Thomas Edison invented the incandescent light bulb during this time. Alexander Graham Bell invented the telephone. During this period, 440,000 patents were given, most of them dealing with electricity. In describing his inventions, Thomas Edison said, "Genius is 1% inspiration and 99% perspiration." Eli Whitney's ideas of mass production began to take hold. The monopolies of Andrew Carnegie, John D Rockefeller, and JP Morgan were built. Along with this wealth came some new ideas as well.
The Gospel of Wealth
The Gospel of Wealth is the idea that if a god has control of the world and you are rich, then you must be blessed by that god. This was often used as an excuse by the rich to justify what they were doing to other people. Although the pay gap was large then, between the rich and the poor, the gap today is much wider.
As a result of mechanization and the idea of the Gospel of Wealth, people started to do things that weren't necessarily honest to become rich. Below are some examples, particularly from the railroad.
Credit Mobilier - Thomas Durant was a civil servant (worked for the government) in charge of getting a company to build the transcontinental railroad. The way this works is that a public notice is sent out and companies are asked to bid for the job. The lowest bid gets the job. Durant, however, did not ask for bids. He created his own company, called Credit Mobilier of America and used it to bid on the railroad. Since the lowest bid (and only bid) was his own company, Durant pretty much gave himself the bid. President Ulysses S Grant (president at the time) was blamed for the scandal. Durant did not get in any legal trouble because it wasn't against the law, but a law was soon passed so no one else could ever do it again.
There were several other scandals that occurred during President Grant's administration. Two men, Fisk and Gould, who worked in the U.S. Treasury Department made millions of dollars by telling their friends when the United States was selling and buying gold. A group of people in the Postal Service sold more stamps than they reported to the government and pocketed the money. A political boss in New York made his employees put their names on their ballots so he could fire them if they didn't vote the way he told them to. Needless to say, Samuel Clemens (Mark Twain) had called this period the Gilded Age to make fun of it.
Price fixing - Since the railroads were all owned by different people, it could potentially be cheaper to ride a train (or ship) from Chicago to Atlanta than Chicago to St. Louis, even though the distance is farther to Atlanta. However, all the railroads decided to raise their prices together so that they could all make more money. This price fixing, along with other railroad issues, led people to not like the railroad industry. As soon as it was feasible to transport people and supplies by car and truck, industries left the railroads, which is why there are so many semi-trucks transporting goods on our freeways today.
Stock Watering - prices, particularly for cows, were set based on how much they weighed. Stock were weighed before they were put on the trains to be shipped to buyers. People who raised cattle found that if they would not let the cows eat or drink for a couple days before they were weighed, and then allowed the cows to eat and drink as much as they wanted the day of or day before the weighing, the cows would weigh more than if they had fed and watered the cows normally. Unfortunately for the buyer, they would expect to get more than they actually received because it was all water-weight, which was lost during the cows' train ride.
With all the corruption surrounding the railroads, the government did try to step in and stop it. The Interstate Commerce Act of 1887 created the ICC (Interstate Commerce Commission). It's job was to watch over the railroads and keep them from being corrupt. A great idea, but the railroads bought out the ICC officials. The states tried to stop the corruption as well. A Supreme Court Case, Wabash v. Illinois, was brought up and the verdict said that the states couldn't do anything because only the federal government can regulate interstate commerce.
As noted before, trusts began to appear. Some other trusts not previously discussed were on sugar, leather, tobacco, and a harvester trust. The sugar trust was actually from Utah, called U&I Sugar. The tobacco trust was the most difficult to get rid of, since the FDA (Food and Drug Administration) didn't have any regulation over them.
In all, the American Dream was very real during the time of Mechanization. People were able to get rich, but there was often a lot of corruption and bribery that occurred as well.
As a result of mechanization and the idea of the Gospel of Wealth, people started to do things that weren't necessarily honest to become rich. Below are some examples, particularly from the railroad.
Credit Mobilier - Thomas Durant was a civil servant (worked for the government) in charge of getting a company to build the transcontinental railroad. The way this works is that a public notice is sent out and companies are asked to bid for the job. The lowest bid gets the job. Durant, however, did not ask for bids. He created his own company, called Credit Mobilier of America and used it to bid on the railroad. Since the lowest bid (and only bid) was his own company, Durant pretty much gave himself the bid. President Ulysses S Grant (president at the time) was blamed for the scandal. Durant did not get in any legal trouble because it wasn't against the law, but a law was soon passed so no one else could ever do it again.
There were several other scandals that occurred during President Grant's administration. Two men, Fisk and Gould, who worked in the U.S. Treasury Department made millions of dollars by telling their friends when the United States was selling and buying gold. A group of people in the Postal Service sold more stamps than they reported to the government and pocketed the money. A political boss in New York made his employees put their names on their ballots so he could fire them if they didn't vote the way he told them to. Needless to say, Samuel Clemens (Mark Twain) had called this period the Gilded Age to make fun of it.
Price fixing - Since the railroads were all owned by different people, it could potentially be cheaper to ride a train (or ship) from Chicago to Atlanta than Chicago to St. Louis, even though the distance is farther to Atlanta. However, all the railroads decided to raise their prices together so that they could all make more money. This price fixing, along with other railroad issues, led people to not like the railroad industry. As soon as it was feasible to transport people and supplies by car and truck, industries left the railroads, which is why there are so many semi-trucks transporting goods on our freeways today.
Stock Watering - prices, particularly for cows, were set based on how much they weighed. Stock were weighed before they were put on the trains to be shipped to buyers. People who raised cattle found that if they would not let the cows eat or drink for a couple days before they were weighed, and then allowed the cows to eat and drink as much as they wanted the day of or day before the weighing, the cows would weigh more than if they had fed and watered the cows normally. Unfortunately for the buyer, they would expect to get more than they actually received because it was all water-weight, which was lost during the cows' train ride.
With all the corruption surrounding the railroads, the government did try to step in and stop it. The Interstate Commerce Act of 1887 created the ICC (Interstate Commerce Commission). It's job was to watch over the railroads and keep them from being corrupt. A great idea, but the railroads bought out the ICC officials. The states tried to stop the corruption as well. A Supreme Court Case, Wabash v. Illinois, was brought up and the verdict said that the states couldn't do anything because only the federal government can regulate interstate commerce.
As noted before, trusts began to appear. Some other trusts not previously discussed were on sugar, leather, tobacco, and a harvester trust. The sugar trust was actually from Utah, called U&I Sugar. The tobacco trust was the most difficult to get rid of, since the FDA (Food and Drug Administration) didn't have any regulation over them.
In all, the American Dream was very real during the time of Mechanization. People were able to get rich, but there was often a lot of corruption and bribery that occurred as well.
Assignment #2
1. What time period did mechanization occur?
2. Define mechanization.
3. Do you think the idea of the Gospel of Wealth exists today? Explain.
4. Why did Mark Twain call the 1880s the Gilded Age?
5. Why did people leave the railroads for cars, when they were available?
6. Explain stock watering in your own words.
7. Imagine you were the president of the United States, had passed the Interstate Commerce Act, and found out that the railroad had bought out the officials. What would you do? (Nothing illegal!)
8. Were the opportunities given for the American Dream worth all the corruption? Explain.
9. Besides the three trusts talked about in other lessons, name two trusts that developed during this time period.
10. What is price fixing?
11. What did Thomas Durant do? Was it illegal?
12. How many patents were given out during this era? What were most of them for?
2. Define mechanization.
3. Do you think the idea of the Gospel of Wealth exists today? Explain.
4. Why did Mark Twain call the 1880s the Gilded Age?
5. Why did people leave the railroads for cars, when they were available?
6. Explain stock watering in your own words.
7. Imagine you were the president of the United States, had passed the Interstate Commerce Act, and found out that the railroad had bought out the officials. What would you do? (Nothing illegal!)
8. Were the opportunities given for the American Dream worth all the corruption? Explain.
9. Besides the three trusts talked about in other lessons, name two trusts that developed during this time period.
10. What is price fixing?
11. What did Thomas Durant do? Was it illegal?
12. How many patents were given out during this era? What were most of them for?