The United States Since the Civil WarLingley, Charles Ramsdell
History
The United States Since the Civil War
Lingley, Charles Ramsdell
United States -- History -- 1865-1921
It will be remembered that the consolidation of small railroad lines
into large systems was accompanied by such advantages to the companies
and to the travelling public, as to demonstrate that combination was the
inevitable order of the day. The similar integration of small industrial
and commercial enterprises took place more slowly between 1870 and 1890,
but the process was no less inevitable on that account. The census of
1890 indicated that the production of manufactured articles had greatly
increased since 1870; more capital was engaged; the product was more
valuable; and more workmen were employed. Nevertheless the number of
establishments which were in operation had shown a considerable decline
in many industries. An army of 100,000 employees represented the
expansion of the wage-earning force in the iron and steel works, for
example, and $270,000,000 the increase in the value of their products;
yet the number of establishments engaged showed a shrinkage of nearly
fourteen per cent. The workers in the textile mills grew from 275,000 to
512,000, and the capital outlay from $300,000,000 to $750,000,000, but
the number of factories declined from 4,790 to 4,114. A cartoon in
_Puck_ on January 26, 1881, remarked that "the telegraph companies have
been consolidated, which in simple language means that Mr. Jay Gould
controls every wire in the United States over which a telegram can be
sent."
Some of the reasons for the prevalent tendency toward combination were
not hard to discover. In the first place, although industrial
organizations fought one another with the utmost bitterness, it was in
the nature of things for them to combine if threatened by any common
foe. Moreover, production on a large scale made possible savings and
improvements that were outside the grasp of more modest enterprises;
buying and selling large quantities of goods commanded opportunities for
profit; waste products could be made use of and costly scientific
investigations conducted in order to discover improved methods, overcome
difficulties and open new avenues of activity; large salaries and
important positions could be offered to men of executive capacity; and
expensive equipment could be purchased and utilized.[1] An effective
force which tended to drive industries to combine was the cut-throat
competition which prevailed. Herbert Croly in his stimulating book _The
Promise of American Life_ vividly describes the bitter, warlike
character of industrial competition after 1865. Competition was battle
to the knife and tomahawk. The leaders were constantly seeking bigger
operations, to which the bigger risks only added zest. A company might
be making unbelievable profits one year and "skirting" bankruptcy the
next. Exciting as all this was, however, the desire for adventure was
not as powerful as the desire for profits, and cut-throat competition in
industry led as naturally to combination, as rate-wars on the railroads
led to pooling agreements.
Public-domain text, read in full here on John Shaqi.
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