History 2710

The Gilded Age

 Readings:  

• Jacob Riis, How the Other Half Lives, 1890--illustrations
• essay by economist Brad Delong on "The Robber Barons.

Discussion Forum:

In the introduction to How the Other Half Lives, Jacob Riis wrote:

• How does Riis' work confirm Mark Twain's characterization of the post Civil War period as a "Gilded Age." 

In-class discussion:

How does deLong help answer the question which is important for us today: At what level does corruption become intolerable and undermine the legitimacy of democracy?

A cartoon about Rockefeller's excessive influence in Washington, D.C.

Corporation: One of the three basic forms of business organization (the other two are proprietorship and partnership). A corporation is a business established through ownership shares (termed corporate stock). Since Supreme Court rulings in the 1870s, A corporation is considered a distinct legal person, that can be sued, forced to pay taxes, etc., just like a human person. Unlike proprietorships and partnerships businesses, a corporation business exists separately from its owners. As such, the owners have what lawyer-types term limited liability. Owners can not be held personally responsible for corporate debts. The owners can only lose the value of their ownership shares, but no more. 

Socialism develops in the 19th century as a critique of capitalism -advocates a system of collective or government ownership and management of the means of production and distribution of goods. Because of the collective nature of socialism, it is to be contrasted to the doctrine of the sanctity of private property that characterizes capitalism. Where capitalism stresses competition and profit, socialism calls for cooperation and social service. In a broader sense, the term socialism is often used loosely to describe economic theories ranging from those that hold that only certain public utilities and natural resources should be owned by the state to those holding that the state should assume responsibility for all economic planning and direction. 

The January 11, 1896 cover of The Ram's Horn, a magazine devoted to the "social gospel." ( The Ram's Horn was published in Chicago, Illinois during the 1890s and the early years of the twentieth century by Frederick L. Chapman & Company. Frank Beard was its principal illustrator.)

Mark Twain called the late nineteenth-century the "Gilded Age." In the popular view, the late nineteenth century was a period of greed and guile, when rapacious robber barons, unscrupulous speculators, and corporate buccaneers engaged in shady business practices and vulgar displays of wealth. It is easy to caricature the Gilded Age as an era of corruption, scandal-plagued politics, conspicuous consumption, and unfettered capitalism. But it is more useful to think of this period as modern America's formative era, when the rules of modern politics and business practice were just beginning to be written.

While the rich wore diamonds, many wore rags. In 1890, 11 million of the nation's 12 million families earned less than $1200 per year; of this group, the average annual income was $380, well below the poverty line. Rural Americans and new immigrants crowded into urban areas. Tenements spread across city landscapes, teeming with crime and filth. Americans had sewing machines, phonographs, skyscrapers, and even electric lights, yet most people labored in the shadow of poverty.

Between 1870 and 1900 the United States became an industrialized economy--the leading industrial nation in the world. And wealth became markedly more concentrated. The share of national wealth held by the richest one percent of households peaked at around 45 percent sometime around 1900

The gap between the rich and the poor during the late 19th century can be expressed in:

Source: Zunz, The Changing Face of Inequality, 1982

Source: U.S. Bureau of the Census

Topic #2: Take a virtual Tour of a New York Tenement. Report your reactions.