UNITED STATES HISTORY AND THE CONSTITUTION

South Carolina Standard USHC-4.4

Mr. Hoover, Abbeville High School

BIG BUSINESS As the influence of Big Business grew in the late

nineteenth century, farmers and workers formed political organizations in an effort to influence the government and claim greater political leverage and economic well-being for themselves.

TECHNOLOGY BACKLASH In order to understand the economic problems

and the political actions of farmers in the 19th century, students must understand the influence of supply and demand on prices.

As a result of the introduction of the steel plow, mechanization such as the reaper that greatly improved productivity, and the availability of land in the West, American farmers produced an abundance of cash crops.

LOSING GROUND Despite the growing urban market, supply

exceeded demand and the price that farmers were able to get for their crops fell.

Farmers were unable to make payments on the loans that they had taken to purchase land and equipment.

ORGANIZING POLITICALLY Farmers first responded to this problem as

individuals by planting more so that they could make more profit.

However, the more farmers planted, the greater the supply and the more prices fell.

Farmers tried to solve their economic problems by organizing politically and farmers elected representatives to state legislatures.

HARDER TIMES During periods of depression of 1873, 1884

and 1893, farmers were hard pressed to make payments on their loans and suffered foreclosures.

Farmers wanted the money supply to be increased to inflate the price they could get for their crops while at the same time allowing them to pay off their fixed mortgages with money that was not worth as much as when they took out the loan.

GRANGER LAWS Because farmers blamed their economic

distress on the railroad for the high prices they charged to ship farm goods to market and to store crops prior to shipment.

State legislatures passed laws, known collectively as the Granger Laws after the farmers’ organization, which tried to regulate how much the railroad could charge for transport and storage of crops.

INTERSTATE COMMERCE However, the Supreme Court found that state

law could not regulate the rate charged by the railroad for transportation across state lines because only the federal government can regulate interstate commerce.

INTERSTATE COMMERCE ACT In response to the outcry of the farmers, the

United States Congress passed the Interstate Commerce Act to control railroad rates and practices, which set a precedent for regulation of business by the federal government.

However, in a series of cases ,the Freight Rate Cases, the Supreme Court severely limited the effectiveness of this law.

POPULIST MOVEMENT Farmers also attempted to influence the national

government through the Populist movement. The Populist Party was formed in the 1890s and

supported the regulation of railroads and banking and an inflationary currency in the form of the free and unlimited coinage of silver, which Populists argued would help them get higher prices for their goods.

EIGHT-HOUR DAY The party also advocated government

reforms to protect democracy from the overweening influence of Big Business such as the popular election of Senators, the secret ballot, and a graduated income tax.

The farmers attempted to ally with the workers by advocating an eight-hour day and restrictions on immigration.

The Populist Party was successful in electing senators, governors and state legislators in the South and West but failed to win the presidency.

DEVELOPMENT OF UNIONS The workers’ attempt to join together to

protect themselves against the abuses of the market place resulted in the development of unions.

As a ‘right to work’ state, there is little public sympathy in South Carolina for the role of unions, so it is essential that unionization receive a balanced treatment in the classroom.

It is also important not to judge the unions of the late 19th century by 20th century allegations of corruption.

POOR WORKING CONDITIONS Workers protested their

treatment in the colonial era and continue to protest their treatment today but the Gilded Age saw the greatest movement toward organization.

This organization was fostered by the deteriorating working conditions, including long hours, low wages and unsafe working conditions, and the changing composition of the work force.

PURSUIT OF PROFIT The pursuit of profit

caused management to increasingly treat workers as replaceable cogs in the wheels of production.

Long hours and unsafe working conditions also resulted from management’s attempt to hold down the cost of production.

WOMEN AND CHILDREN

The law of supply and demand was applied to labor. As more and more immigrants came to the United States, women and children were added to the industrial work force and the influx of dispossessed farmers drove down wages.

During the 1890s only 45% of unskilled workers earned more than $500 a year, the equivalent of today’s poverty line

INJURY AND DEATH Unemployment, injury and death were a

constant threat to the industrial worker. Labor unions developed to address these

conditions. Although the early unions advocated

arbitration and opposed the strike, wildcat walkouts, spontaneous responses to lay-offs or wage cuts, were blamed on the union.

These conditions often occurred during cyclical depressions.

FIRST STRIKES Striking when many

other unskilled workers were also desperately seeking employment undermined the effectiveness of the strike.

Management used recent immigrants and African Americans as ‘scabs’ to break the strikes.

PRIVATE SECURITY FORCES Management also

employed private security forces, exercised economic pressure through company ownership of homes and company stores as well as ‘yellow dog’ contracts and blacklisting to control the workers.

Local and national government also took the side of management, protecting their property by putting down strikes and arresting strikers.

STRIKE OF 1877 The U.S. government used of government

troops in major labor incidents such as the Railroad Strike of 1877, the Haymarket Incident and the Pullman strike.

As a result of violence during strikes, union members were often associated in the media and therefore in the public mind with dangerous foreign radicals such as socialists, communists and anarchists.

THE SHERMAN ANTI-TRUST ACT Nativist prejudices created animosity towards

labor organizations. The arrest and imprisonment of the leader of

the Pullman strike led to the Supreme Court’s application of the Sherman Anti-Trust Act to unions.

This act, designed to control the power of Big Business, was used against the workers’ unions at the same time that the court was finding that it could not be applied to Big Business.

CRAFT UNIONS The organization of workers into craft unions

of skilled workers rather than industrial unions of all workers led to some success for the labor union movement through use of collective bargaining on the “bread and butter” issues of wages, hours and conditions.

Skilled workers were more difficult to replace and so the threat of strike was more effective.

UNION EFFECTIVENESS Although wages rose and hours fell by the

end of the century, the average hours worked were still far longer than the 8-hour day advocated by unions.

Wages were still very low. Union effectiveness was undermined by the

relatively small number of workers who belonged to unions, only about 4% of all workers by 1900.

LABOR UNIONS Labor unions of the late nineteenth century

were neither socialist nor communist organizations.

This common misunderstanding is the result of anti-immigrant and anti-union rhetoric.

By the end of the 19th century, unions were not successful in changing the abuses of the workplace.

This was due to public perception of them as dangerous and to government support of Big Business.

ELECTION OF 1896 The election of 1896

was a pivotal one for farmers and workers. Although the main issue was “soft” money versus “hard” money, bimetallism vs. gold;

The underlying issue was which groups the government would protect: bankers and businessmen or farmers and laborers.

WILLIAM JENNINGS BRYAN They should be

familiar with William Jennings Bryan and the “Cross of Gold” speech, with the front porch campaign of William McKinley and the role of Big Business in securing McKinley’s election. 

INFLATIONARY MONETARY POLICY Workers voted for the Republican Party

because they feared for their jobs and because they did not support an inflationary monetary policy that would raise the price of food.

Farmers and workers were unsuccessful in using the democratic process to solve their economic problems in the 19th century because they failed to appeal to the growing middle class

GREAT DEPRESSION The problems of the farmers and workers

continued into the 20th century and were somewhat addressed by policies of the Progressive Era and that farmers and workers fell onto hard times again in the 1920s with the policies of Republican presidents and depression.

Farmers’ and workers’ issues were eventually addressed during the Great Depression in the New Deal.