Account For America’s Industrial Growth After 1865.

The sheer geographical size of America was advantageous with respect to quantity of land and accumulated mineral resources, however had it not been for the railways it is likely that industrial growth would have been retarded. Canals, roads and rivers provided adequate transport links prior to the mid nineteenth century and continued to do so, but it was the railways that provided a massive boon to industry by both utilising and advancing other market sectors. The railways had already begun to ease the passage West earlier in the century, consequently aiding the creation of a national market by making vast areas of land accessible and increasing settlement. From the 1860’s the widening markets and reduced transportation costs opened the floodgates for a surge of industrial activity, producing a stronger demand for capital goods. This encouraged the growth of the metal and manufacturing industries. By 1900 193,000 miles of railroad track covered America, linking East to West and symbolising the very essence of progress.

The iron and steel industries were direct benefactors of the railway growth. An innovation in steel manufacture called the Bessemer Process meant that steel could be economically produced and hence became major agent in contributing to industrial expansion. The durability and strength of steel compared to iron aided the development of the railway network; stronger rolling stock and steel rails meant freight loads could be increased maximising efficiency and profits, therefore generating capital. Steel was also used widely in the construction industry, for ship building, bridges and later in the automobile industry; it provided the industrial skeleton on which the American economy was built.

The complex symbiosis existing between accessibility to natural resources, improving raw materials and the emergence of new technological innovation and invention was another crucial development for American industrialisation. The increase in inventiveness and search for new techniques was illustrated by the rise in the number of patents from an annual average of 13000 in the 1870’s to 21000 in the 1890’s. The Americans were not adverse to applying technology and shamelessly exploiting discoveries made by Europeans. Telephones took over from telegraph improving communications and Thomas A. Edison and George Westinghouse pioneered electricity as source of light and power, through development of the electric light bulb and the application of alternating current. The new technologies brought about mass production, increased profits, lowered costs and maximised efficiency.  

Mechanisation and new technology was at the very core of industrial growth, however the human element was just as crucial. The rising population created an expanding market and provided a workforce. The need for unskilled labour in the new factory systems was met largely by the influx of immigrants; between 1860 and 1920, 30 million immigrants entered America. The growth in population by immigration was advantageous to the economy as it supplied a workforce for which no financial outlay had been required in formative years. It was the role of the businessman to guide the process of industrialisation, smaller businessmen like the aforementioned Edison, turned invention into business by creating companies to market his numerous inventions. Others like butcher Gustavus Swift used invention to aid their businesses. Swift pioneered the use of refrigerated rail freight to enhance his meat packing business in 1885. This genre of businessmen did contribute to the process of industrial growth, but it was the emergence of a small but highly significant group of entrepreneurs who truly revolutionised managerial systems and business structures. These men have been dubbed as ‘Robber Barons’ or ‘Captains of Industry’.

‘By virtue of their personalities, their talents or their tactics these business leaders bestrode the economic landscape like Gullivers in the Land of Lilliput, endowing the age with many of their personal characteristics.’

Their business interests were spread over various industries and the most notable figures were Jay Gould who was associated with the railways, Cornelius Vanderbilt, a shipping magnate, Andrew Carnegie a self made man who built a steel empire, J. P. Morgan, a banker and John D. Rockefeller, an oil tycoon. Some of these men like Gould were ruthless and corrupt, others like Carnegie more philanthropic and socially astute. These men revolutionised business structure by consolidating many small businesses into large units and then applying vertical and in the case of Rockefeller, horizontal integration to the structure thus forcing out competition and creating giant monopolies and amassing huge fortunes while many who worked for them remained in the depths of poverty.

The desire for wealth and success during this period stimulated the drive for profit and promoted the idea of laissez-faire conservatism and Social Darwinism. These ideologies were the dominant social and political doctrines at the time and drew on the theories of the biologist Charles Darwin and philosopher Herbert Spencer. Spencer applied Darwin’s theory of natural selection to social principles and maintained that the notion of ‘survival of the fittest’ encouraged human progress. Intervention by the state to aid the weaker members of society would impinge on the path of progress. Despite predisposition to the doctrine of laissez-faire government support for business assisted the process of industrial growth in many ways. The Republican ideal was one committed to expansion, growth and free trade and therefore the paternalistic intervention in economic policy was something of a paradox.  The railways were heavily subsidised by the federal government, particularly where private and foreign investment was lacking due to the risk of fluctuations inherent in the emergent capitalist economy. Between 1850 and 1872 the federal government gave 70 railroads, 183 million acres of land, and cash loans worth millions to aid railroad construction. This did pay dividends as it has been calculated that the Union Pacific Railroad alone added approximately $16.5million a year to the national income. Liberal land laws like the Homestead Act of 1862 were a significant intervention in economic policy as they opened public land for private ownership attracting immigrants and encouraging settlement in the West.  Protective tariffs were also imposed on some imported goods to protect and nurture the domestic economy.

The factors thus far discussed are not altogether unique to American experience; many other European countries experienced similar conditions but failed to industrialise so quickly. Perhaps the one constituent that may have catalysed the rapidity of industrial growth, more than the railways, the steel industry or the Robber Barons is the underpinning intangible concept of the ‘American Dream.’ This ethos remains as strong now, as it appeared to be then. For the massive influx of immigrants, America was a land of opportunity that supported change and embraced progress. ‘In a country of such scope and variety, all things seemed possible’. The ideology of individualism promoted the idea that by working hard the prospect of social mobility in true ‘rags to riches’ fashion was an obtainable aspiration. The Jacksonian motto of ‘equal opportunity for all, special privileges for none’ reigned supreme. In a land with no monarchy and no tradition there seemed no limits to curtail the ‘American Dream’. The reality for many settled Americans and immigrants alike could not have presented a more contradictory experience.

 

The brief account above is merely an outline of the main causes of industrialisation in America after 1865, stressing the elements that seemed to intensify and accelerate the process of industrial growth. It is difficult to pinpoint one single causal factor, although arguably it may be possible to rank the causes. Essentially the very nature of the phenomenon exists only as a complex combination of factors, their simultaneous interaction, producing in just one generation, growth so intense, and so pervasive, that the entire American infrastructure was completely transformed. The social costs of such rapid industrial and economic change however, was a price still to be paid.

BIBLIOGRAPHY

SECONDARY SOURCES

Boyer et al The Enduring Vision, A History of the American People (Boston: Houghton Mifflin Company. Concise 4th Edition 2002)

Thomas C Cochran  ‘ Did the Civil War Retard Industrialization?’ in Essays in American Economic History, ed. by A.W. Coats and Ross M. Robertson (London: Edward Arnold, 1969)

Carl N. Degler The Age of the Economic Revolution 1876-1900 (Glenview, Illinois: Scott, Foresman and Company 1977 2nd Edition) 

Major Problems in the Gilded Age and the Progressive Era ed. by Leon Fink (Toronto: D.C Heath and Company 1993)

Robert L. Heilbroner, Aaron Singer The Economic Transformation of America: 1600 to the Present. (San Diego: Harcourt Brace Jovanovich, Publishers 2nd Edition 1984)

Maldwyn A. Jones The Short Oxford History of the Modern World, The Limits of Liberty, American History 1607-1980 (Oxford: Oxford University Press, 1983)

 

H.Wayne Morgan Unity and Culture, The United States 1877-1900 (England: Penguin Books 1971)

Word count 1998

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