ESSAY

Jackie Q., Blake F., Emily M.                                                                                         2/28/08

AHAP                                                                                                                                KLM

Worker Exploitation and the “Robber Barons” of the Gilded Age

At the end of the 19^th century, industrialization rapidly spread throughout the U.S. A handful of individuals gained substantial power, allowing their big businesses and corporations to flourish. Paradoxically, the standards and conditions of the American working class worsened.  Through monopolies, trusts, and other “tools” of management, big-time industrialists exercised virtually complete authority over the economy. Although some believed in the "Gospel of Wealth" and the sharing of profits, many sought to reap as much benefit as possible and use power for personal gain. In turn, these "Robber Barons” exploited and put down those who worked beneath them.

With big businesses on the rise, many investors and entrepreneurs were out to make a profit. Some companies formed monopolies as they controlled specific markets, forcing “mom-and-pop” shops and new businesses to fail. Building these monopolies through vertical or horizontal integration practically eliminated any significant competition for the company, allowing for complete dominance in its respective market. However, as new markets and big corporations gained momentum, a steady demand for products, and thus a large supply of labor, was needed. Fortunately for these big businesses, the influx of immigrants and large number of unskilled workers during the late nineteenth and early twentieth centuries helped to satisfy the demand for large-scale labor. Because these laborers performed basic and sometimes rudimentary tasks, their skills were not viewed as valuable to the company; they were simply a pair of hands on the assembly line. In this light, many of these workers were exploited as working conditions were sacrificed for increased production. Corporations lowered wages, increased hours, and disregarded safety and sanitation in their factories. Many workers had trouble understanding how one rich man was able to control the lives of many. Industrial tycoons such as Andrew Carnegie and J.P. Morgan had started from scratch, and built themselves up to become millionaires. Many workers asked themselves the questions: If he is a “self-made” man, why not I? What future is there for the common man? Some workers challenged the management that allowed or created these conditions, yet others simply had to accept them. The workers that revolted against unfair working conditions formed labor unions to protect themselves from harsh management. However, the “tools” exercised by management over the labor unions far outweighed any potential “tools” of defense the unions had. Union members would go on strike or boycott products in response to wage cuts or unfair conditions. However, these corporations would call in military backup (the actual U.S. military or companies such as the Pinkertons), blacklist strike and union leaders, and bring in scabs. Scabs were workers, often African Americans or immigrants, who were called in to take the place of striking workers. In the Railroad Strike of 1877, the Baltimore-Ohio Railroad Company workers revolted against the corporation for unfair conditions. Subdued by the Pinkertons (a hired-out militant detective agency) and the U.S. Army, the strike turned into a bloody riot, resulting in many deaths and a defeat for the workers.

Another powerful trade union of the late 19^th century was the Amalgamated Association of Iron and Steel Workers. The Association was mainly comprised of skilled workers, which were in high demand by employers. Thus, this unionhad significant control over the conditions under which its members worked. However, in the early 1890s, Henry Clay Frick, a lieutenant for Andrew Carnegie, realized the Amalgamated were becoming too powerful as workersand therefore must go. For the next two years, the steel corporation continually cut the wages of the union workers until they finally went on strike. However, the Pinkertons were called in and the protest was suppressed. This event was a turning point for the Association, which steadily declined after the incident.  The Association also faced failure partly due to competition with multitude of unskilled jobs and the inexperienced workers that filled them. Between 1890 and 1910, there were over 25,000 strikes and job riots, most of them ending in victory for the corporation. In addition to subduing labor unions, industrialists further strengthened their power by developing new techniques in order to lessen competition and consolidate business. One such technique was the creation of trusts. In trusts, stockholders of individual corporations hand their stocks to a small group of trustees. Thus, the trustees have control over the stockholders’ company, and sometimes several different corporations at once. Another method used by corporations to maximize profits and minimize risks was pooling. By consolidating funds and resources, assets were more easily managed by large corporations.

            The 19th century was an era of widespread invention and discovery with significant developments in labor-saving technology. These included the assembly line, the vacuum cleaner, the sewing machine, the engine and many more. These inventions were very beneficial to big businesses and corporations. Labor-saving technology increased production of goods as they decreased the demand for labor. This process is known as the Luddite fallacy. Along with the fact that the big businesses were increasing unemployment, they were also making work more difficult for those who were still able to hold jobs. For example, the “speed-up” concept of the assembly line rushed workers to produce more goods and work faster as corporate and factory managers sped up the assembly line. Not only did this make the work much more difficult, but the workers also didn't receive an increase in pay, which clearly shows that this method was only beneficial for the corporations. Due to the fact that the workers were still receiving the same wages while the corporations were prospering, the rich were gaining more wealth than they deserved, thus widening the gap between the elite and the working class.

            Evidently, there were many social consequences brought about by the concentration of economic power in big businesses, but none with as much impact as their exploitation of the working class. With the rise of these corporations came wretched conditions under which the new working class were forced to work, including unsafe and unsanitary working conditions, low wages, long hours, and little job security, leaving them vulnerable to boom-and-bust cycles and thus unemployment. These “Robber Barrons,” who benefited disproportionately from their underpaid labor, failed to appreciate or even recognize that their wealth and prosperity was created by the working classes.

 FINAL GRADE --> 18/20 --> other tools of management?  Gospel of Wealth??