Big Business in the Gilded Age

The late 19th century and early 20th century, dubbed the Gilded Age by writer Mark Twain, was a time of great growth and change in every aspect of the United States, and even more so for big business. It was this age that gave birth to many of the important modern business practices we take for granted today, and those in charge of business at the time were considered revolutionaries, whether it was for the good of the people or the good of themselves.

The exact period of time in which the Gilded Age occurred is ever-debatable, but most historians can at least agree that it started within the 20 years after the Civil War ended and lasted until the early 1920s. (West) The Gilded Age itself was characterized by the beginnings of corporations and corrupt political machines. Policies such as the General Incorporation Laws allowed business to grow larger more easily, and with less red tape involved. New technology allowed faster and more efficient production, but this explosive growth of industry called for not only more resources, but new business practices and leaders as well. (Moritz 10-12)

Although not a natural resource, railroads were considered one of the key factors in almost every widespread industry. It allowed companies to quickly send products across the entire nation without using expensive and time-consuming caravans or wagons. Cornelius Vanderbilt was a prominent leader in the railroad industry at this time. He was already in his later years by the time the Gilded Age rolled around and didn't even get to see the uprising of some of the greatest leaders of the time. The railroad companies took advantage of their necessity by constantly overcharging customers, especially farmers. This led to one of the first labor unions in the United States, an organization known as the Grange. The members of the Grange banded together and put up a big fight against the railroads, a fight which eventually led to the basis of the Interstate Commerce Act of 1887. This law forced the railroads to report to the federal government before making important decisions like how much to charge customers. The railroad companies were outraged and used the defense that their monopolies were almost automatically formed, but there was nothing they could do since the law was federal. (Moritz 19-24, 28)

Telegraph grids were another technological advancement of the Gilded Age. For the first time in history, transcontinental communication was possible. People could now find out about news from across the nation within minutes of it happening, instead of days as it sometimes took before. Businesses took advantage of this by building plants and factories all across the country, hiring managers for each individual outfit, and communicating among each location with ease. (Sinclair 75) Telegraph lines were also a nurturing point for one of the most famous business tycoons of the Gilded Age, Andrew Carnegie. (Carnegie 653)

Carnegie not only got his start as a young Irish immigrant working as a railroad telegraph operator, his first major corporation was the Keystone Telegraph Company, in which he acquired the Pacific and Atlantic Telegraph Company. Carnegie thought of giving up on business after having moderate success, but on a trip to England in 1872, he met with Henry Bessemer and saw his plans for steel. (Carnegie 657-62) This greatly intrigued Carnegie, and in the next 27 years of his life, he used newly developed business practices such as horizontal and vertical integrations to build one of the largest steel companies in the world, which is still in existence today as United States Steel. (West)

Around the same time of Carnegie, another young immigrant got his start into the business world.