INDUSTRIAL AMERICA AT THE END OF THE CIVIL WAR

A comprehensive survey of the United States, at the end of the Civil War, would reveal a state of society which bears little resemblance to that of today.Almost all those commonplace fundamentals of existence, the things that contribute to our bodily comfort while they vex us with economic and political problems, had not yet made their appearance.The America of Civil War days was a country without transcontinental railroads, without telephones, without European cables, or wireless stations, or automobiles, or electric lights, or sky-scrapers, or million-dollar hotels, or trolley cars, or a thousand other contrivances that today supply the conveniences and comforts of what we call our American civilization.The cities of that period, with their unsewered and unpaved streets, their dingy, flickering gaslights, their ambling horse-cars, and their hideous slums, seemed appropriate settings for the unformed social life and the rough-and-ready political methods of American democracy.

The railroads, with their fragile iron rails, their little wheezy locomotives, their wooden bridges, their unheated coaches, and their kerosene lamps, fairly typified the prevailing frontier business and economic organization.But only by talking with the business leaders of that time could we have understood the changes that have taken place in fifty years.For the most part we speak a business language which our fathers and grandfathers would not have comprehended.The word "trust" had not become a part of their vocabulary; "restraint of trade" was a phrase which only the antiquarian lawyer could have interpreted;"interlocking directorates," "holding companies," "subsidiaries,""underwriting syndicates," and "community of interest"--all this jargon of modern business would have signified nothing to our immediate ancestors.Our nation of 1865 was a nation of farmers, city artisans, and industrious, independent business men, and small-scale manufacturers.Millionaires, though they were not unknown, did not swarm all over the land.Luxury, though it had made great progress in the latter years of the war, had not become the American standard of well-being.The industrial story of the United States in the last fifty years is the story of the most amazing economic transformation that the world has ever known; a change which is fitly typified in the evolution of the independent oil driller of western Pennsylvania into the Standard Oil Company, and of the ancient open air forge on the banks of the Allegheny into the United States Steel Corporation.

The slow, unceasing ages had been accumulating a priceless inheritance for the American people.Nearly all of their natural resources, in 1865, were still lying fallow, and even undiscovered in many instances.Americans had begun, it is true, to exploit their more obvious, external wealth, their forests and their land; the first had made them one of the world's two greatest shipbuilding nations, while the second had furnished a large part of the resources that had enabled the Federal Government to fight what was, up to that time, the greatest war in history.But the extensive prairie plains whose settlement was to follow the railroad extensions of the sixties and the seventies--Kansas, Nebraska, Iowa, Oklahoma, Minnesota, the Dakotas--had been only slightly penetrated.This region, with a rainfall not too abundant and not too scanty, with a cultivable soil extending from eight inches to twenty feet under the ground, with hardly a rock in its whole extent, with scarcely a tree, except where it bordered on the streams, has been pronounced by competent scientists the finest farming country to which man has ever set the plow.Our mineral wealth was likewise lying everywhere ready to the uses of the new generation.The United States now supplies the world with half its copper, but in 1865it was importing a considerable part of its own supply.It was not till 1859 that the first "oil gusher" of western Pennsylvania opened up an entirely new source of wealth.Though we had the largest coal deposits known to geologists, we were bringing large supplies of this indispensable necessity from Nova Scotia.It has been said that coal and iron are the two mineral products that have chiefly affected modern civilization.Certainly the nations that have made the greatest progress industrially and commercially--England, Germany, America--are the three that possess these minerals in largest amount.From sixty to seventy per cent of all the known coal deposits in the world were located in our national domain.Nature had given no other nation anything even remotely comparable to the four hundred and eighty square miles of anthracite in western Pennsylvania and West Virginia.

Enormous fields of bituminous lay in those Appalachian ranges extending from Pennsylvania to Alabama, in Michigan, in the Rocky Mountains, and in the Pacific regions.In speaking of our iron it is necessary to use terms that are even more extravagant.From colonial times Americans had worked the iron ore plentifully scattered along the Atlantic coast, but the greatest field of all, that in Minnesota, had not been scratched.From the settlement of the country up to 1869 it had mined only 50,000,000tons of iron ore, while up to 1910 we had produced 685,000,000tons.The streams and waterfalls that, in the next sixty years, were to furnish the power that would light our cities, propel our street-cars, drive our transcontinental trains across the mountains, and perform numerous domestic services, were running their useless courses to the sea.

Industrial America is a product of the decades succeeding the Civil War; yet even in 1865 we were a large manufacturing nation.

The leading characteristic of our industries, as compared with present conditions, was that they were individualized.Nearly all had outgrown the household stage, the factory system had gained a foothold in nearly every line, even the corporation had made its appearance, yet small-scale production prevailed in practically every field.In the decade preceding the War, vans were still making regular trips through New England and the Middle States, leaving at farmhouses bundles of straw plait, which the members of the household fashioned into hats.The farmers' wives and daughters still supplemented the family income by working on goods for city dealers in ready-made clothing.We can still see in Massachusetts rural towns the little shoe shops in which the predecessors of the existing factory workers soled and heeled the shoes which shod our armies in the early days of the Civil War.

Every city and town had its own slaughter house; New York had more than two hundred; what is now Fifth Avenue was frequently encumbered by large droves of cattle, and great stockyards occupied territory which is now used for beautiful clubs, railroad stations, hotels, and the highest class of retail establishments.

In this period before the Civil War comparatively small single owners, or frequently copartnerships, controlled practically every industrial field.Individual proprietors, not uncommonly powerful families which were almost feudal in character, owned the great cotton and woolen mills of New England.Separate proprietors, likewise, controlled the iron and steel factories of New York State and Pennsylvania.Indeed it was not until the War that corporations entered the iron industry, now regarded as the field above all others adapted to this kind of organization.The manufacture of sewing machines, firearms, and agricultural implements started on a great scale in the Civil War; still, the prevailing unit was the private owner or the partnership.In many manufacturing lines, the joint stock company had become the prevailing organization, but even in these fields the element that so characterizes our own age, that of combination, was exerting practically no influence.

Competition was the order of the day: the industrial warfare of the sixties was a free-for-all.A mere reference to the status of manufactures in which the trust is now the all-prevailing fact will make the contrast clear.In 1865 thousands of independent companies were drilling oil in Pennsylvania and there were more than two hundred which were refining the product.Nearly four hundred and fifty operators were mining coal, not even dimly foreseeing the day when their business would become a great railroad monopoly.The two hundred companies that were making mowers and reapers, seventy-five of them located in New York State, had formed no mental picture of the future International Harvester Company.One of our first large industrial combinations was that which in the early seventies absorbed the manufacturers of salt; yet the close of the Civil War found fifty competing companies making salt in the Saginaw Valley of Michigan.In the same State, about fifty distinct ownerships controlled the copper mines, while in Nevada the Comstock Lode had more than one hundred proprietors.The modern trust movement has now absorbed even our lumber and mineral lands, but in 1865 these rich resources were parceled out among a multiplicity of owners: No business has offered greater opportunities to the modern promoter of combinations than our street railways.In 1865 most of our large cities had their leisurely horse-car systems, yet practically every avenue had its independent line.New York had thirty separate companies engaged in the business of local transportation.Indeed the Civil War period developed only one corporation that could be described as a "trust" in the modern sense.This was the Western Union Telegraph Company.Incredible as it may seem, more than fifty companies, ten years before the Civil War, were engaged in the business of transmitting telegraphic messages.These companies had built their telegraph lines precisely as the railroads had laid their tracks; that is, independent lines were constructed connecting two given points.

It was inevitable, of course, that all these scattered lines should come under a single control, for the public convenience could not be served otherwise.This combination was effected a few years before the War, when the Western Union Telegraph Company, after a long and fierce contest, succeeded in absorbing all its competitors.Similar forces were bringing together certain continuous lines of railways, but the creation of huge trunk systems had not yet taken place.How far our industrial era is removed from that of fifty years ago is apparent when we recall that the proposed capitalization of $15,000,000, caused by the merging of the Boston and Worcester and the Western railroads, was widely denounced as "monstrous" and as a corrupting force that would destroy our Republican institutions.

Naturally this small-scale ownership was reflected in the distribution of wealth.The "swollen fortunes" of that period rested upon the same foundation that had given stability for centuries to the aristocracies of Europe.Social preeminence in large cities rested almost entirely upon the ownership of land.

The Astors, the Goelets, the Rhinelanders, the Beekmans, the Brevoorts, and practically all the mighty families that ruled the old Knickerbocker aristocracy in New York were huge land proprietors.Their fortunes thus had precisely the same foundation as that of the Prussian Junkers today.But their accumulations compared only faintly with the fortunes that are commonplace now.How many "millionaires" there were fifty years ago we do not precisely know.The only definite information we have is a pamphlet published in 1855 by Moses Yale Beach, proprietor of the New York Sun, on the "Wealthy Men of New York."This records the names of nineteen citizens who, in the estimation of well-qualified judges, possessed more than a million dollars each.The richest man in the list was William B.

Astor, whose estate is estimated at $6,000,000.The next richest man was Stephen Whitney, also a large landowner, whose fortune is listed at $5,000,000.Then comes James Lenox, again a land proprietor, with $3,000,000.The man who was to accumulate the first monstrous American fortune, Cornelius Vanderbilt, is accredited with a paltry $1,500,000.Mr.Beach's little pamphlet sheds the utmost light upon the economic era preceding the Civil War.It really pictures an industrial organization that belongs as much to ancient history as the empire of the Caesars.His study lists about one thousand of New York's "wealthy citizens."Yet the fact that a man qualified for entrance into this Valhalla who had $100,000 to his credit and that nine-tenths of those so chosen possessed only that amount shows the progress concentrated riches have made in sixty years.How many New Yorkers of today would look upon a man with $100,000 as "wealthy"?

The sources of these fortunes also show the economic changes our country has undergone.Today, when we think of our much exploited millionaires, the phrase "captains of industry" is the accepted description; in Mr.Beach's time the popular designation was "merchant prince." His catalogue contains no "oil magnates" or "steel kings" or "railroad manipulators"; nearly all the industrial giants of ante-bellum times--as distinguished from the socially prominent whose wealth was inherited--had heaped together their accumulations in humdrum trade.Perhaps Peter Cooper, who had made a million dollars in the manufacture of isinglass and glue, and George Law, whose gains, equally large, represented fortunate speculations in street railroads, faintly suggest the approaching era; yet the fortunes which are really typical are those of William Aspinwall, who made $4,000,000 in the shipping business, of A.T.Stewart, whose $2,000,000represented his earnings as a retail and wholesale dry goods merchant, and of Peter Harmony, whose $1,000,000 had been derived from happy trade ventures in Cuba and Spain.Many of the reservoirs of this ante-bellum wealth sound strangely in our modern ears.John Haggerty had made $1,000,000 as an auctioneer;William L.Coggeswell had made half as much as a wine importer;Japhet Bishop had rounded out an honest $600,000 from the profits of a hardware store; while Phineas T.Barnum ranks high in the list by virtue of $800,000 accumulated in a business which it is hardly necessary to specify.Indeed his name and that of the great landlords are almost the only ones in this list that have descended to posterity.Yet they were the Rockefellers, the Carnegies, the Harrimans, the Fricks, and the Henry Fords of their day.

Before the Civil War had ended, however, the transformation of the United States from a nation of farmers and small-scale manufacturers to a highly organized industrial state had begun.

Probably the most important single influence was the War itself.

Those four years of bitter conflict illustrate, perhaps more graphically than any similar event in history, the power which military operations may exercise in stimulating all the productive forces of a people.In thickly settled nations, with few dormant resources and with practically no areas of unoccupied land, a long war usually produces industrial disorganization and financial exhaustion.The Napoleonic wars had this effect in Europe; in particular they caused a period of social and industrial distress in England.The few years immediately following Waterloo marked a period when starving mobs rioted in the streets of London, setting fire to the houses of the aristocracy and stoning the Prince Regent whenever he dared to show his head in public, when cotton spindles ceased to turn, when collieries closed down, when jails and workhouses were overflowing with a wretched proletariat, and when gaunt and homeless women and children crowded the country highways.No such disorders followed the Civil War in this country, at least in the North and West.Spiritually the struggle accomplished much in awakening the nation to a consciousness of its great opportunities.The fact that we could spend more than a million dollars a day--expenditures that hardly seem startling in amount now, but which were almost unprecedented then--and that soon after hostilities ceased we rapidly paid off our large debt, directed the attention of foreign capitalists to our resources, and gave them the utmost confidence in this new investment field.