This chapter focuses on the industrial side of the post-Civil War period known as the Gilded Age.
It discusses the rise and development of some important industries, as well as the interplay of big
business with governmental politics. The topic is introduced with a description of Mark Twain's
The Gilded Age
, a book that satirizes the corruption and venality of the era and questions
the future of democracy.
Old Industries Transformed, New Industries Born, pp. 599-610
In the years following the Civil War, American industry expanded mightily. Old industries were
transformed into new, modern industries, with discovery and invention stimulating many new
industries. Railroads were the key development in this change, creating a national market and
spurring the growth of the steel industry. Business magnates like Jay Gould, Andrew Carnegie,
and John D. Rockefeller pioneered the way in the booming capitalism of the Gilded Age.
Railroads, America's First Big Business
After the Civil War, the United States built the largest railroad system in the world. Jay Gould's
career as a railroad magnate parallels the rise of the railroads as the single largest and most
important industry in America. Although he used railroads more as a tool for manipulating the
stock market than as a transportation source, Gould contributed to the explosion of railroad
building during the Gilded Age. Built without any central planning, the railroads eventually
became overextended and destructively competitive. To encourage railroad building, the federal
and state governments provided the railroad companies with generous cash subsidies and land
grants. States and local communities clamored to offer inducements to railroad builders, knowing
that towns and villages along the tracks would grow and flourish. A similar revolution in
communications accompanied and supported the growth of the railroad. Here again Jay Gould
took a leading role. By 1879, through stock manipulation, he seized control of Western Union, the
company that monopolized the telegraph industry. In 1892, Jay Gould died, and newspapers
labeled him the most hated man in America.
Andrew Carnegie, Steel, and Vertical Integration
Andrew Carnegie became the premier "rags to riches" hero during the Gilded Age. He rose from
humble Scottish origins as a child factory laborer to become one of the greatest industrialists of
his day. He made his fortune in the steel industry using techniques learned from the railroad
industry, a large amount of capital acquired from the stock market, and the newly developed