13 Politics in the Gilded Age, 1870—1900

Politics in the Gilded Age, 1870—1900

The challenges Americans faced in the post-Civil War era extended far beyond the issue of Reconstruction and the challenge of an economy without slavery. Political and social repair of the nation was paramount, as was the correlative question of race relations in the wake of slavery. In addition, farmers faced the task of cultivating arid western soils and selling crops in an increasingly global commodities market, while workers in urban industries suffered long hours and hazardous conditions at stagnant wages.

Farmers, who still composed the largest percentage of the U.S. population, faced mounting debts as agricultural prices spiraled downward. These lower prices were due in large part to the cultivation of more acreage using more productive farming tools and machinery, global market competition, as well as price manipulation by commodity traders, exorbitant railroad freight rates, and costly loans upon which farmers depended. For many, their hard work resulted merely in a continuing decline in prices and even greater debt. These farmers, and others who sought leaders to heal the wounds left from the Civil War, organized in different states, and eventually into a national third-party challenge, only to find that, with the end of Reconstruction, federal political power was stuck in a permanent partisan stalemate, and corruption was widespread at both the state and federal levels.

As the Gilded Age unfolded, presidents had very little power, due in large part to highly contested elections in which relative popular majorities were razor-thin. Two presidents won the Electoral College without a popular majority. Further undermining their efficacy was a Congress comprising mostly politicians operating on the principle of political patronage. Eventually, frustrated by the lack of leadership in Washington, some Americans began to develop their own solutions, including the establishment of new political parties and organizations to directly address the problems they faced. Out of the frustration wrought by war and presidential political impotence, as well as an overwhelming pace of industrial change, farmers and workers formed a new grassroots reform movement that, at the end of the century, was eclipsed by an even larger, mostly middle-class, Progressive movement. These reform efforts did bring about change—but not without a fight.

The Gilded Age

Mark Twain coined the phrase “Gilded Age” in a book he co-authored with Charles Dudley Warner in 1873, The Gilded Age: A Tale of Today. The book satirized the corruption of post-Civil War society and politics. Indeed, popular excitement over national growth and industrialization only thinly glossed over the stark economic inequalities and various degrees of corruption of the era. Politicians of the time largely catered to business interests in exchange for political support and wealth. Many participated in graft and bribery, often justifying their actions with the excuse that corruption was too widespread for a successful politician to resist. The machine politics of the cities, specifically Tammany Hall in New York, illustrate the kind of corrupt, but effective, local and national politics that dominated the era.

Nationally, between 1872 and 1896, the lack of clear popular mandates made presidents reluctant to venture beyond the interests of their traditional supporters. As a result, for nearly a quarter of a century, presidents had a weak hold on power, and legislators were reluctant to tie their political agendas to such weak leaders. On the contrary, weakened presidents were more susceptible to support various legislators’ and lobbyists’ agendas, as they owed tremendous favors to their political parties, as well as to key financial contributors, who helped them garner just enough votes to squeak into office through the Electoral College. As a result of this relationship, the rare pieces of legislation passed were largely responses to the desires of businessmen and industrialists whose support helped build politicians’ careers.

What was the result of this political malaise? Not surprisingly, almost nothing was accomplished on the federal level. However, problems associated with the tremendous economic growth during this time continued to mount. More Americans were moving to urban centers, which were unable to accommodate the massive numbers of working poor. Tenement houses with inadequate sanitation led to widespread illness. In rural parts of the country, people fared no better. Farmers were unable to cope with the challenges of low prices for their crops and exorbitant costs for everyday goods. All around the country, Americans in need of solutions turned further away from the federal government for help, leading to the rise of fractured and corrupt political groups. (2)

The Key Political Issues: Patronage, Tariffs, and Gold

Patronage: The Spoils System vs Civil Service

At the heart of each president’s administration was the protection of the spoils system, that is, the power of the president to practice widespread political patronage. Patronage, in this case, took the form of the president naming his friends and supporters to various political posts. Given the close calls in presidential elections during the era, the maintenance of political machinery and repaying favors with patronage was important to all presidents, regardless of party affiliation. This had been the case since the advent of a two-party political system and universal male suffrage in the Jacksonian era. For example, upon assuming office in March 1829, President Jackson immediately swept employees from over nine hundred political offices, amounting to 10 percent of all federal appointments. Among the hardest-hit was the U.S. Postal Service, which saw Jackson appoint his supporters and closest friends to over four hundred positions in the service.

At the same time, a movement emerged in support of reforming the practice of political appointments. As early as 1872, civil service reformers gathered to create the Liberal Republican Party in an effort to unseat incumbent President Grant. Led by several midwestern Republican leaders and newspaper editors, this party provided the impetus for other reform-minded Republicans to break free from the party and actually join the Democratic Party ranks. With newspaper editor Horace Greeley as their candidate, the party called for a “thorough reform of the civil service as one the most pressing necessities” facing the nation. Although easily defeated in the election that followed, the work of the Liberal Republican Party set the stage for an even stronger push for patronage reform.

Clearly owing favors to his Republican handlers for his surprise compromise victory by the slimmest of margins in 1876, President Hayes was ill-prepared to heed those cries for reform, despite his own stated preference for a new civil service system. In fact, he accomplished little during his four years in office other than granting favors, as dictated by Republic Party handlers. Two powerful Republican leaders attempted to control the president. The first was Roscoe Conkling, Republican senator from New York and leader of the Stalwarts, a group that strongly supported continuation of the current spoils system. Long supporting former President Grant, Conkling had no sympathy for some of Hayes’ early appeals for civil service reform. The other was James G. Blaine, Republican senator from Maine and leader of the Half-Breeds. The Half-Breeds, who received their derogatory nickname from Stalwart supporters who considered Blaine’s group to be only “half-Republican,” advocated for some measure of civil service reform.

With his efforts towards ensuring African American civil rights stymied by a Democratic Congress, and his decision to halt the coinage of silver merely adding to the pressures of the economic Panic of 1873, Hayes failed to achieve any significant legislation during his presidency. However, he did make a few overtures towards civil service reform. First, he adopted a new patronage rule, which held that a person appointed to an office could be dismissed only in the interest of efficient government operation but not for overtly political reasons. Second, he declared that party leaders could have no official say in political appointments, although Conkling sought to continue his influence. Finally, he decided that government appointees were ineligible to manage campaign elections. Although not sweeping reforms, these were steps in a civil service direction.

Hayes’ first target in his meager reform effort was to remove Chester A. Arthur, a strong Conkling man, from his post as head of the New York City Customs House. Arthur had been notorious for using his post as customs collector to gain political favors for Conkling. When Hayes forcibly removed him from the position, even Half-Breeds questioned the wisdom of the move and began to distance themselves from Hayes. The loss of his meager public support due to the Compromise of 1877 and the declining Congressional faction together sealed Hayes fate and made his reelection impossible. (2)

An Assassin’s Bullet Sets the Stage for Civil Service Reform

In the wake of President Hayes’ failure, Republicans began to battle over a successor for the 1880 presidential election. Initially, Stalwarts favored Grant’s return to the White House, while Half-Breeds promoted their leader, James Blaine. Following an expected convention deadlock, both factions agreed to a compromise presidential candidate, Senator James A. Garfield of Ohio, with Chester Arthur as his vice-presidential running mate. The Democratic Party turned to Winfield Scott Hancock, a former Union commander who was a hero of the Battle of Gettysburg, as their candidate.

Garfield won a narrow victory over Hancock by forty thousand votes, although he still did not win a majority of the popular vote. But less than four months into his presidency, events pushed civil service reform on the fast track. On July 2, 1881, Charles Guiteau shot and killed Garfield (Figure), allegedly uttering at the time, “I am a Stalwart of Stalwarts!” Guiteau himself had wanted to be rewarded for his political support—he had written a speech for the Garfield campaign—with an ambassadorship to France. His actions at the time were largely blamed on the spoils system, prompting more urgent cries for change.

Charles Guiteau was a lawyer and supporter of the Republican Party, although not particularly well known in either area. But he gave a few speeches, to modest crowds, in support of the Republican nominee James Garfield, and ultimately deluded himself that his speeches influenced the country enough to cause Garfield’s victory. After the election, Guiteau immediately began pressuring the new president, requesting a post as ambassador. When his queries went unanswered, Guiteau, out of money and angry that his supposed help had been ignored, planned to kill the president.

He spent significant time planning his attack and considered weapons as diverse as dynamite and a stiletto before deciding on a gun, stating, “I wanted it done in an American manner.” He followed the president around the Capitol and let several opportunities pass, unwilling to kill Garfield in front of his wife or son. Frustrated with himself, Guiteau recommitted to the plan and wrote a letter to the White House, explaining how this act would “unite the Republican Party and save the Republic.”

An engraving of James A. Garfield's assassination, published in Frank Leslie's Illustrated Newspaper. The caption reads Washington, D.C.—The attack on the President's life—Scene in the ladies' room of the Baltimore and Ohio Railroad depot—The arrest of the assassin / from sketches by our special artist's [sic] A. Berghaus and C. Upham. President Garfield is at center right, leaning after being shot. He is supported by Secretary of State James G. Blaine who wears a light colored top hat. To left, assassin Charles Guiteau is restrained by members of the crowd, one of whom is about to strike him with a cane
Figure 3-6 Garfield assassination, engraving cropped by A. Berghaus and C. Upham is in the Public Domain . An engraving of James A. Garfield’s assassination, published in Frank Leslie’s Illustrated Newspaper. The caption reads “Washington, D.C.—The attack on the President’s life—Scene in the ladies’ room of the Baltimore and Ohio Railroad depot—The arrest of the assassin / from sketches by our special artist’s [sic] A. Berghaus and C. Upham.” President Garfield is at center right, leaning after being shot. He is supported by Secretary of State James G. Blaine who wears a light colored top hat. To left, assassin Charles Guiteau is restrained by members of the crowd, one of whom is about to strike him with a cane.

Guiteau shot the president from behind and continued to shoot until police grabbed him and hauled him away. He went to jail, and, the following November after Garfield had died, he stood trial for murder. His poor mental health, which had been evident for some time, led to eccentric courtroom behavior that the newspapers eagerly reported and the public loved. He defended his case with a poem that used religious imagery and suggested that God had ordered him to commit the murder. He defended himself in court by saying, “The doctors killed Garfield, I just shot him.” While this in fact was true, it did not save him. Guiteau was convicted and hanged in the summer of 1882.

Surprising both his party and the Democrats when he assumed the office of president, Chester Arthur immediately distanced himself from the Stalwarts. Although previously a loyal party man, Arthur understood that he owed his current position to no particular faction or favor. He was in the unique position to usher in a wave a civil service reform unlike any other political candidate, and he chose to do just that. In 1883, he signed into law the Pendleton Civil Service Act, the first significant piece of anti-patronage legislation. This law created the Civil Service Commission, which listed all government patronage jobs and then set aside approximately 10 percent of the list as appointments to be determined through a competitive civil service examination process. Furthermore, to prevent future presidents from undoing this reform, the law declared that future presidents could enlarge the list but could never shrink it by moving a civil service job back into the patronage column. (2)

Tariffs in the Gilded Age

In addition to civil service, President Arthur also carried the reformist spirit into the realm of tariffs, or taxes on international imports to the United States. Tariffs had long been a controversial topic in the United States, especially as the nineteenth century came to a close. Legislators appeared to be bending to the will of big businessmen who desired higher tariffs in order to force Americans to buy their domestically produced goods rather than higher-priced imports. Lower tariffs, on the other hand, would reduce prices and lower the average American’s cost of living, and were therefore favored by many working-class families and farmers, to the extent that any of them fully understood such economic forces beyond the prices they paid at stores. Out of growing concern for the latter group, Arthur created the U.S. Tariff Commission in 1882 to investigate the propriety of increasingly high tariffs. Despite his concern, along with the commission’s recommendation for a 25 percent rollback in most tariffs, the most Arthur could accomplish was the “Mongrel Tariff” of 1883, which lowered tariff rates by barely 5 percent.

Such bold attempts at reform further convinced Republican Party leaders, as the 1884 election approached, that Arthur was not their best option to continue in the White House. Arthur quickly found himself a man without a party. As the 1884 election neared, the Republican Party again searched their ranks for a candidate who could restore some semblance of the spoils system while maintaining a reformist image. Unable to find such a man, the predominant Half-Breeds again turned to their own leader, Senator Blaine. However, when news of his many personal corrupt bargains began to surface, a significant portion of the party chose to break from the traditional Stalwarts-versus-Half-Breeds debate and form their own faction, the Mugwumps, a name taken from the Algonquin phrase for “great chief.”

Anxious to capitalize on the disarray within the Republican Party, as well as to return to the White House for the first time in nearly thirty years, the Democratic Party chose to court the Mugwump vote by nominating Grover Cleveland, the reform governor from New York who had built a reputation by attacking machine politics in New York City. Despite several personal charges against him for having fathered a child out of wedlock, Cleveland managed to hold on for a close victory with a margin of less than thirty thousand votes.

Cleveland’s record on civil service reform added little to the initial blows struck by President Arthur. After electing the first Democratic president since 1856, the Democrats could actually make great use of the spoils system. Cleveland was, however, a notable reform president in terms of business regulation and tariffs. When the U.S. Supreme Court ruled in 1886 that individual states could not regulate interstate transportation, Cleveland urged Congress to pass the Interstate Commerce Act of 1887. Among several other powers, this law created the Interstate Commerce Commission (ICC) to oversee railroad prices and ensure that they remained reasonable to all customers.

This was an important shift. In the past, railroads had granted special rebates to big businesses, such as John D. Rockefeller’s Standard Oil, while charging small farmers with little economic muscle exorbitant rates. Although the act eventually provided for real regulation of the railroad industry, initial progress was slow due to the lack of enforcement power held by the ICC. Despite its early efforts to regulate railroad rates, the U.S. Supreme Court undermined the commission in Interstate Commerce Commission v. Cincinnati, New Orleans, and Texas Pacific Railway Cos. in 1897. Rate regulations were limits on profits that, in the opinion of a majority of the justices, violated the Fourteenth Amendment protection against depriving persons of their property without due process of the law.

As for tariff reform, Cleveland agreed with Arthur’s position that tariffs remained far too high and were clearly designed to protect big domestic industries at the expense of average consumers who could benefit from international competition. While the general public applauded Cleveland’s efforts at both civil service and tariff reform, influential businessmen and industrialists remained adamant that the next president must restore the protective tariffs at all costs.

To counter the Democrats’ re-nomination of Cleveland, the Republican Party turned to Benjamin Harrison, grandson of former president William Henry Harrison. Although Cleveland narrowly won the overall popular vote, Harrison rode the influential coattails of several businessmen and party bosses to win the key electoral states of New York and New Jersey, where party officials stressed Harrison’s support for a higher tariff, and thus secure the White House. Not surprisingly, after Harrison’s victory, the United States witnessed a brief return to higher tariffs and a strengthening of the spoils system. In fact, the McKinley Tariff raised some rates as much as 50 percent, which was the highest tariff in American history to date.

Some of Harrison’s policies were intended to offer relief to average Americans struggling with high costs and low wages, but remained largely ineffective. First, the Sherman Anti-Trust Act of 1890 sought to prohibit business monopolies as “conspiracies in restraint of trade,” but it was seldom enforced during the first decade of its existence. Second, the Sherman Silver Purchase Act of the same year required the U.S. Treasury to mint over four million ounces of silver into coins each month to circulate more cash into the economy, raise prices for farm goods, and help farmers pay their way out of debt. But the measure could not undo the previous “hard money” policies that had deflated prices and pulled farmers into well-entrenched cycles of debt. Other measures proposed by Harrison intended to support African Americans, including a Force Bill to protect voters in the South, as well as an Education Bill designed to support public education and improve literacy rates among African Americans, also met with defeat. (2)

Monetary Policies and the Issue of Gold vs Silver

Although political corruption, the spoils system, and the question of tariff rates were popular discussions of the day, none were more relevant to working-class Americans and farmers than the issue of the nation’s monetary policy and the ongoing debate of gold versus silver. There had been frequent attempts to establish a bimetallic standard, which in turn would have created inflationary pressures and placed more money into circulation that could have subsequently benefitted farmers. But the government remained committed to the gold standard, including the official demonetizing of silver altogether in 1873. Such a stance greatly benefitted prominent businessmen engaged in foreign trade while forcing more farmers and working-class Americans into greater debt.

As farmers and working-class Americans sought the means by which to pay their bills and other living expenses, especially in the wake of increased tariffs as the century came to a close, many saw adherence to a strict gold standard as their most pressing problem. With limited gold reserves, the money supply remained constrained. At a minimum, a return to a bimetallic policy that would include the production of silver dollars would provide some relief. However, the aforementioned Sherman Silver Purchase Act was largely ineffective to combat the growing debts that many Americans faced. Under the law, the federal government purchased 4.5 million ounces of silver on a monthly basis in order to mint silver dollars. However, many investors exchanged the bank notes with which the government purchased the silver for gold, thus severely depleting the nation’s gold reserve. Fearing the latter, President Grover Cleveland signed the act’s repeal in 1893. This lack of meaningful monetary measures from the federal government would lead one group in particular who required such assistance—American farmers—to attempt to take control over the political process itself. (2)

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Farmers Revolt in the Populist Era

The challenges that many American farmers faced in the last quarter of the nineteenth century were significant. They contended with economic hardships born out of rapidly declining farm prices, prohibitively high tariffs on items they needed to purchase, and foreign competition. One of the largest challenges they faced was overproduction, where the glut of their products in the marketplace drove the price lower and lower.

Overproduction of crops occurred in part due to the westward expansion of homestead farms and in part because industrialization led to new farm tools that dramatically increased crop yields. As farmers fell deeper into debt, whether it be to the local stores where they bought supplies or to the railroads that shipped their produce, their response was to increase crop production each year in the hope of earning more money with which to pay back their debt. The more they produced, the lower prices dropped. To a hard-working farmer, the notion that their own overproduction was the greatest contributing factor to their debt was a completely foreign concept.

In addition to the cycle of overproduction, tariffs were a serious problem for farmers. Rising tariffs on industrial products made purchased items more expensive, yet tariffs were not being used to keep farm prices artificially high as well. Therefore, farmers were paying inflated prices but not receiving them. Finally, the issue of gold versus silver as the basis of U.S. currency was a very real problem to many farmers. Farmers needed more money in circulation, whether it was paper or silver, in order to create inflationary pressure. Inflationary pressure would allow farm prices to increase, thus allowing them to earn more money that they could then spend on the higher-priced goods in stores. However, in 1878, federal law set the amount of paper money in circulation, and, as mentioned above, Harrison’s Sherman Silver Act, intended to increase the amount of silver coinage, was too modest to do any real good, especially in light of the unintended consequence of depleting the nation’s gold reserve. In short, farmers had a big stack of bills and wanted a big stack of money—be it paper or silver—to pay them. Neither was forthcoming from a government that cared more about issues of patronage and how to stay in the White House for more than four years at a time. (2)

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Farmers Begin to Organize

The initial response by increasingly frustrated and angry farmers was to organize into groups that were similar to early labor unions. Taking note of how the industrial labor movement had unfolded in the last quarter of the century, farmers began to understand that a collective voice could create significant pressure among political leaders and produce substantive change. While farmers had their own challenges, including that of geography and diverse needs among different types of famers, they believed this model to be useful to their cause.

One of the first efforts to organize farmers came in 1867 with Oliver Hudson Kelly’s creation of the Patrons of Husbandry, more popularly known as the Grange. In the wake of the Civil War, the Grangers quickly grew to over 1.5 million members in less than a decade. Kelly believed that farmers could best help themselves by creating farmers’ cooperatives in which they could pool resources and obtain better shipping rates, as well as prices on seeds, fertilizer, machinery, and other necessary inputs. These cooperatives, he believed, would let them self-regulate production as well as collectively obtain better rates from railroad companies and other businesses.

The Farmers’ Alliance, a conglomeration of three regional alliances formed in the mid-1880s, took root in the wake of the Grange movement. In 1890, Dr. Charles Macune, who led the Southern Alliance, which was based in Texas and had over 100,000 members by 1886, urged the creation of a national alliance between his organization, the Northwest Alliance, and the Colored Alliance, the largest African American organization in the United States.

Led by Tom Watson, the Colored Alliance, which was founded in Texas but quickly spread throughout the Old South, counted over one million members. Although they originally advocated for self-help, African Americans in the group soon understood the benefits of political organization and a unified voice to improve their plight, regardless of race. While racism kept the alliance splintered among the three component branches, they still managed to craft a national agenda that appealed to their large membership. All told, the Farmers’ Alliance brought together over 2.5 million members, 1.5 million white and 1 million black.

The alliance movement, and the subsequent political party that emerged from it, also featured prominent roles for women. Nearly 250,000 women joined the movement due to their shared interest in the farmers’ worsening situation as well as the promise of being a full partner with political rights within the group, which they saw as an important step towards advocacy for women’s suffrage on a national level. The ability to vote and stand for office within the organization encouraged many women who sought similar rights on the larger American political scene. Prominent alliance spokeswoman, Mary Elizabeth Lease of Kansas, often spoke of membership in the Farmers’ Alliance as an opportunity to “raise less corn and more hell!”

The alliance movement had several goals similar to those of the original Grange, including greater regulation of railroad prices and the creation of an inflationary national monetary policy. However, most creative among the solutions promoted by the Farmers’ Alliance was the call for a subtreasury plan. Under this plan, the federal government would store farmers’ crops in government warehouses for a brief period of time, during which the government would provide loans to farmers worth 80 percent of the current crop prices. Thus, farmers would have immediate cash on hand with which to settle debts and purchase goods, while their crops sat in warehouses and farm prices increased due to this control over supply at the market. When market prices rose sufficiently high enough, the farmer could withdraw his crops, sell at the higher price, repay the government loan, and still have profit remaining.

Economists of the day thought the plan had some merit; in fact, a greatly altered version would subsequently be adopted during the Great Depression of the 1930s, in the form of the Agricultural Adjustment Act. However, the federal government never seriously considered the plan, as congressmen questioned the propriety of the government serving as a rural creditor making loans to farmers with no assurance that production controls would result in higher commodity prices. The government’s refusal to act on the proposal left many farmers wondering what it would take to find solutions to their growing indebtedness. (2)

From Organization to Political Party

Angry at the federal government’s continued unwillingness to substantively address the plight of the average farmer, Charles Macune and the Farmers’ Alliance chose to create a political party whose representatives—if elected—could enact real change. Put simply, if the government would not address the problem, then it was time to change those elected to power.

In 1891, the alliance formed the Populist Party, or People’s Party, as it was more widely known. Beginning with nonpresidential-year elections, the Populist Party had modest success, particularly in Kansas, Nebraska, and the Dakotas, where they succeeded in electing several state legislators, one governor, and a handful of congressmen. As the 1892 presidential election approached, the Populists chose to model themselves after the Democratic and Republican Parties in the hope that they could shock the country with a “third-party” victory.

At their national convention that summer in Omaha, Nebraska, they wrote the Omaha Platform to more fully explain to all Americans the goals of the new party. Written by Ignatius Donnelly, the platform statement vilified railroad owners, bankers, and big businessmen as all being part of a widespread conspiracy to control farmers. As for policy changes, the platform called for adoption of the subtreasury plan, government control over railroads, an end to the national bank system, the creation of a federal income tax, the direct election of U.S. senators, and several other measures, all of which aimed at a more proactive federal government that would support the economic and social welfare of all Americans. At the close of the convention, the party nominated James B. Weaver as its presidential candidate.

In a rematch of the 1888 election, the Democrats again nominated Grover Cleveland, while Republicans went with Benjamin Harrison. Despite the presence of a third-party challenger, Cleveland won another close popular vote to become the first U.S. president to be elected to nonconsecutive terms. Although he finished a distant third, Populist candidate Weaver polled a respectable one million votes. Rather than being disappointed, several Populists applauded their showing—especially for a third party with barely two years of national political experience under its belt. They anxiously awaited the 1896 election, believing that if the rest of the country, in particular industrial workers, experienced hardships similar to those that farmers already faced, a powerful alliance among the two groups could carry the Populists to victory. (2)

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Social and Labor Unrest in the 1890s

Insofar as farmers wanted the rest of the country to share their plight, they got their wish. Soon after Cleveland’s election, the nation catapulted into the worst economic depression in its history to date. As the government continued to fail in its efforts to address the growing problems, more and more Americans sought relief outside of the traditional two-party system. To many industrial workers, the Populist Party began to seem like a viable solution. (2)

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From Farmers’ Hardships to a National Depression

The late 1880s and early 1890s saw the American economy slide precipitously. As mentioned above, farmers were already struggling with economic woes, and the rest of the country followed quickly. Following a brief rebound from the speculation-induced Panic of 1873, in which bank investments in railroad bonds spread the nation’s financial resources too thin—a rebound due in large part to the protective tariffs of the 1880s—a greater economic catastrophe hit the nation, as the decade of the 1890s began to unfold.

The causes of the Depression of 1893 were manifold, but one major element was the speculation in railroads over the previous decades. The rapid proliferation of railroad lines created a false impression of growth for the economy as a whole. Banks and investors fed the growth of the railroads with fast-paced investment in industry and related businesses, not realizing that the growth they were following was built on a bubble. When the railroads began to fail due to expenses outpacing returns on their construction, the supporting businesses, from banks to steel mills, failed also.

Beginning with the closure of the Philadelphia & Reading Railroad Company in 1893, several railroads ceased their operations as a result of investors cashing in their bonds, thus creating a ripple effect throughout the economy. In a single year, from 1893 to 1894, unemployment estimates increased from 3 percent to nearly 19 percent of all working-class Americans. In some states, the unemployment rate soared even higher: over 35 percent in New York State and 43 percent in Michigan. At the height of this depression, over three million American workers were unemployed. By 1895, Americans living in cities grew accustomed to seeing the homeless on the streets or lining up at soup kitchens.

Immediately following the economic downturn, people sought relief through their elected federal government. Just as quickly, they learned what farmers had been taught in the preceding decades: A weak, inefficient government interested solely in patronage and the spoils system in order to maintain its power was in no position to help the American people face this challenge. The federal government had little in place to support those looking for work or to provide direct aid to those in need. Of course, to be fair, the government had seldom faced these questions before. Americans had to look elsewhere.

A notable example of the government’s failure to act was the story of Coxey’s Army. In the spring of 1894, businessman Jacob Coxey led a march of unemployed Ohioans from Cincinnati to Washington, DC, where leaders of the group urged Congress to pass public works legislation for the federal government to hire unemployed workers to build roads and other public projects. From the original one hundred protesters, the march grew five hundred strong as others joined along the route to the nation’s capital. Upon their arrival, not only were their cries for federal relief ignored, but Coxey and several other marchers were arrested for trespassing on the grass outside the U.S. Capitol. Frustration over the event led many angry works to consider supporting the Populist Party in subsequent elections.

Several strikes also punctuated the growing depression, including a number of violent uprisings in the coal regions of Ohio and Pennsylvania. But the infamous Pullman Strike of 1894 was most notable for its nationwide impact, as it all but shut down the nation’s railroad system in the middle of the depression. The strike began immediately on the heels of the Coxey’s Army march when, in the summer of 1894, company owner George Pullman fired over two thousand employees at Pullman Co.—which made railroad cars, such as Pullman sleeper cars—and reduced the wages of the remaining three thousand workers. Since the factory operated in the company town of Pullman, Illinois, where workers rented homes from George Pullman and shopped at the company store owned by him as well, unemployment also meant eviction. Facing such harsh treatment, all of the Pullman workers went on strike to protest the decisions. Eugene V. Debs, head of the American Railway Union, led the strike.

In order to bring the plight of Pullman, Illinois, to Americans all around the country, Debs adopted the strike strategy of ordering all American Railroad Union members to refuse to handle any train that had Pullman cars on it. Since virtually every train in the United States operated with Pullman cars, the strike truly brought the transportation industry to its knees. Fearful of his ability to end the economic depression with such a vital piece of the economy at a standstill, President Cleveland turned to his attorney general for the answer. The attorney general proposed a solution: use federal troops to operate the trains under the pretense of protecting the delivery of the U.S. mail that was typically found on all trains. When Debs and the American Railway Union refused to obey the court injunction prohibiting interference with the mail, the troops began operating the trains, and the strike quickly ended. Debs himself was arrested, tried, convicted, and sentenced to six months in prison for disobeying the court injunction. The American Railway Union was destroyed, leaving workers even less empowered than before, and Debs was in prison, contemplating alternatives to a capitalist-based national economy. The Depression of 1893 left the country limping towards the next presidential election with few solutions in sight. (2)

The Election of 1896

As the final presidential election of the nineteenth century unfolded, all signs pointed to a possible Populist victory. Not only had the ongoing economic depression convinced many Americans—farmers and factory workers alike—of the inability of either major political party to address the situation, but also the Populist Party, since the last election, benefited from four more years of experience and numerous local victories. As they prepared for their convention in St. Louis that summer, the Populists watched with keen interest as the Republicans and Democrats hosted their own conventions.

The Republicans remained steadfast in their defense of a gold-based standard for the American economy, as well as high protective tariffs. They turned to William McKinley, former congressman and current governor of Ohio, as their candidate. At their convention, the Democrats turned to William Jennings Bryan—a congressman from Nebraska. Bryan defended the importance of a silver-based monetary system and urged the government to coin more silver. Furthermore, being from farm country, he was very familiar with the farmers’ plight and saw some merit in the subtreasury system proposal. In short, Bryan could have been the ideal Populist candidate, but the Democrats got to him first.

The Populist Party subsequently endorsed Bryan as well, with their party’s nomination three weeks later.

As the Populist convention unfolded, the delegates had an important decision to make: either locate another candidate, even though Bryan would have been an excellent choice, or join the Democrats and support Bryan as the best candidate but risk losing their identity as a third political party as a result. The Populist Party chose the latter and endorsed Bryan’s candidacy. However, they also nominated their own vice-presidential candidate, Georgia Senator Tom Watson, as opposed to the Democratic nominee, Arthur Sewall, presumably in an attempt to maintain some semblance of a separate identity.

The race was a heated one, with McKinley running a typical nineteenth-century style “front porch” campaign, during which he espoused the long-held Republican Party principles to visitors who would call on him at his Ohio home. Bryan, to the contrary, delivered speeches all throughout the country, bringing his message to the people that Republicans “shall not crucify mankind on a cross of gold.” (2)

William Jennings Bryan and the “Cross Of Gold”

William Jennings Bryan was a politician and speechmaker in the late nineteenth century, and he was particularly well known for his impassioned argument that the country move to a bimetal or silver standard. He received the Democratic presidential nomination in 1896, and, at the nominating convention, he gave his most famous speech. He sought to argue against Republicans who stated that the gold standard was the only way to ensure stability and prosperity for American businesses. In the speech he said:

We say to you that you have made the definition of a business man too limited in its application. The man who is employed for wages is as much a business man as his employer; the attorney in a country town is as much a business man as the corporation counsel in a great metropolis; the merchant at the cross-roads store is as much a business man as the merchant of New York; the farmer who goes forth in the morning and toils all day, who begins in spring and toils all summer, and who by the application of brain and muscle to the natural resources of the country creates wealth, is as much a business man as the man who goes upon the Board of Trade and bets upon the price of grain; … We come to speak of this broader class of business men.

This defense of working Americans as critical to the prosperity of the country resonated with his listeners, as did his passionate ending when he stated, “Having behind us the producing masses of this nation and the world, supported by the commercial interests, the laboring interests, and the toilers everywhere, we will answer their demand for a gold standard by saying to them: ‘You shall not press down upon the brow of labor this crown of thorns; you shall not crucify mankind upon a cross of gold.’”

The speech was an enormous success and played a role in convincing the Populist Party that he was the candidate for them.

The result was a close election that finally saw a U.S. president win a majority of the popular vote for the first time in twenty-four years. McKinley defeated Bryan by a popular vote of 7.1 million to 6.5 million. Bryan’s showing was impressive by any standard, as his popular vote total exceeded that of any other presidential candidate in American history to that date—winner or loser. He polled nearly one million more votes than did the previous Democratic victor, Grover Cleveland; however, his campaign also served to split the Democratic vote, as some party members remained convinced of the propriety of the gold standard and supported McKinley in the election.

Amid a growing national depression where Americans truly recognized the importance of a strong leader with sound economic policies, McKinley garnered nearly two million more votes than his Republican predecessor Benjamin Harrison. Put simply, the American electorate was energized to elect a strong candidate who could adequately address the country’s economic woes. Voter turnout was the largest in American history to that date; while both candidates benefitted, McKinley did more so than Bryan.

In the aftermath, it is easy to say that it was Bryan’s defeat that all but ended the rise of the Populist Party. Populists had thrown their support to the Democrats who shared similar ideas for the economic rebound of the country and lost. In choosing principle over distinct party identity, the Populists aligned themselves to the growing two-party American political system and would have difficulty maintaining party autonomy afterwards. Future efforts to establish a separate party identity would be met with ridicule by critics who would say that Populists were merely “Democrats in sheep’s clothing.”

But other factors also contributed to the decline of Populism at the close of the century. First, the discovery of vast gold deposits in Alaska during the Klondike Gold Rush of 1896–1899 (also known as the “Yukon Gold Rush”) shored up the nation’s weakening economy and made it possible to thrive on a gold standard. Second, the impending Spanish-American War, which began in 1898, further fueled the economy and increased demand for American farm products. Still, the Populist spirit remained, although it lost some momentum at the close of the nineteenth century. As will be seen in a subsequent chapter, the reformist zeal took on new forms as the twentieth century unfolded. (2)

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