Alan Trachtenberg


Synopsis of
Chapter 03: Capital and Labor
As Trachtenberg previously stated, the new machines caused a need for a new form of production and business. A rapid increase in industrialization created many discontented wage laborers and enterprising capitalists. Unsure of where the lines were drawn, the two forces clashed repeatedly throughout this period.


With the depression of 1873 and the violence of 1877, the United States was again facing a civil disaster. The rise in unemployment, poverty, unrest, and strikes -- situations people left the Old World to escape -- threatened the haven found in the republican experiment of this nation.

Called everything from suspicious-looking individuals to enemies of society, strikers continually fought for the promised equality of the free labor system offered by the Republican party during the Civil War. With this situation in the foreground of public consciousness, social contrasts between the monied class and the poor industrial worker moved the problems into the larger field of politics.

An expanding middle class found itself caught between the two social extremes. For this rising middle class, the wealthy represented those true Americans who had fulfilled the ambition of upward mobility and self-employment. However, the lower class wage laborer resented the stifling of his upward mobility and self-employment. It was for the ability to pursue this ambition that workers went on strike. As the product of this wealthy accumulation of business, the workers regarded the resulting wage labor as "slavery." The immense structure of capital and capitalists became an anti-democratic disease.

Because of these differing views, political and ideological campaigns took the appearance of struggles for the meaning of "America" and "American." This issue of definition swept across every campaign and conflict, no more so than in the contest between capital and labor.

After aligning themselves with the Republicans during the war, the laborers' disenchantment with the capitalist system spawned from the growing sense of discrepancy between the promises of a party and the actualities.

During the Civil War, the Republican/Northern Consensus espoused the doctrine of free labor, the nobility and dignity of work. This doctrine was based on the idea of personal advancement and security for honest labor and conservative values. However once the war ended, Republican politicians compromised on this issue in order to create a strong National government backed by both North and South. This compromise justified the place of big business as the American ideal.

Although increasingly insulted by society, working people still compared themselves with the doctrine of free labor, the republican tradition. Labor spokesmen combined this doctrine with the ideals of "republican" to form an image of manual workers fighting to defend the republic. The struggle between capital and labor had moved beyond just the workers complaints and into a conflict of culture.


As the system grew, the gulf between the wage laborer and the capitalist owner expanded as well, moving beyond the work place and permeating all of life. Wealthy owners left the cities and moved into the country, building new communities based on ownership and wealth. No longer would a common wage laborer attend the same church as the privileged class, nor their children the same schools. More and more, the workers took on a foreign cast. The monied class started resembling each other: white, Anglo-Saxon, Protestant, and Republican.

New technology expanded the rift and caused people to question definitions of established words--capital, labor, enterprise, work, ownership. Rapid changes left the country in turmoil. Old ideals for success quickly shifted. The ability to mobilize, organize, and incorporate replaced thrift and diligence. Obedience and loyalty became the new qualities represented within the free labor system. Social Darwinism explained the whole process of extreme transfers of money and power.

Out of this chaos, robber barons with the ability of restructuring enterprises into corporations succeeded. Capable of both controlling competition and creating a pool of capital, corporations swiftly displaced individual ownerships and partnerships as the significant organizations of business. With this growth of the corporation, the divide between the common laborer and management grew, creating a new class of middle management.

Immense images of personal power, force, and money dominated the Gilded Age; names became household figures: Rockefeller, Carnegie, Morgan, Stanford, Harriman. Known for their ruthless ability to monopolize, organize, and move, these men started the trends seen today in business. As Rockefeller said, "The day of combination is here to stay. Individualism has gone, never to return."


Not only did these robber barons control the businesses, with their money they slowly took over all aspects regarding culture. By prominent displays of wealth, the corporate owners convinced the middle classes the drive for success, for competitive enterprise, fulfilled the American ideal.

As a white middle class continued to rise, occupying the upper management levels of these corporations, the working class created a startling contrast in both appearance and ideals. Women and children joined the lower class work force, separating the two classes of workers by offering another change from the middle class ideals of home and school. Daily increasing in distance, the wide gulf between the industrial workers and owners mirrored itself in a wide gulf between ideas of "American" values.

The unrest caused by this chasm displayed itself in the rising number of strikes and labor unions. Used as a tool to display a collective response to local circumstances, workers viewed the strike as a defiance of the societal norm. Developing from terms used within various processes of work (the act of taking down sails, tearing down), the word "strike" became a negative (as opposed to productive) form of collective freedom, thus the representative of republican values.

Causes of these strikes were numerous. At first, the strikes started as expressions of dissatisfaction with the wage level. Over forty percent of the nation was considered well below the poverty level. Conditions within the work place -- long hours, unhealthy/unsafe environments -- as well as a general unease with the commodification of the workers' time (worker = hours worked = money) and the appropriation of skills by industrialization ignited strikes throughout the land.

Unions formed to help mediate between and fight the machine that displaced the worker as a human being. However, disputes arose within the unions, as the traditional boundaries of race, ethnicity, and gender could not be breached to form a collective whole.

The idea of the collective voice arose within a time rife with divisions: black and white, Protestant and Catholic/Jewish, capital and labor, men and women. Advocating equal pay for equal work, the unions borrowed rhetoric from a variety of sources deemed useful. The actual source of the language lost its importance as it was appropriated by the collective whole.

Although republican in rhetoric, the labor movement created problems within the cultural definition of success, the individualistic values of business and middle-class aspirations. Both the corporation and the union represented one person as an entity. For the corporation, this collective whole was a way of diminishing liabilities for the investors. For the union, the collective whole took on the liabilities of the individual. The debate between capital and labor became a debate of the qualities of America, with neither side willing to set all the terms.

Echoed by this rise in the numbers of laborers and the growing split in the classes, a rise in the cities populations also challenged ideas of America. Previous puritanical ideas of the city had to be revised to correspond with this growth.