Economic History of the U. S. Econ 1740, Class Time Line. Part 1: The Colonial Era; 1607 – 1776

Chapter 11

1860-

1830-

1840-1850’s

1845-1847

1860

1820-

1827-  

1776–1860

1860-

1847-

Chapter 12 and 13

1781-

1783-

1787-

1792-

1793-

1808-

1812-

1816-

1825-

1827-

1828-

1837-

1839-

1842-

1843-

1848-

1850-

1854-

• 
  The South had to use some of its precious manpower to repress its slave labor force. And, when circumstances permitted, slaves and free blacks joined the Union forces, further tipping the balance in the favor of the North.
  
• 
  The South’s hope was that the North would eventually tire of the enormous human costs of the war and agree to let the south go its own way. The Revolutionary War had provide a forceful example of a nation winning independence from an economic and militarily more powerful foe.
  
• 
  The South’s early confidence in the power of King Cotton and the likelihood of a quick end to fighting, moreover, encouraged it to adopt trade policies that reinforced its poor preparation for war.
  
• 
  Despite the heroism and daring displayed by the Confederates, Union troops increasingly disrupted and occupied more and more southern territory.
  
• 
  Once a Union victory appeared likely, confidence declined even more sharply, producing the astronomical rates of inflation experienced in the final months of the war.
  
• 
  The economic strain of the war was not as severe in the North as it was in the South, but the costs of the war were extremely high even there. A substantial portion of the labor force was reallocated to the war effort, and the composition of production changed with the disruption of cotton trade and growing number of defaults on southern debts.
  
• 
  The Union government also resorted to inflationary finance. Paper notes, termed “greenbacks” because of their color were issued.
  
• 
  The Beard-Hacker thesis emphasized that the war stimulated the economy and the increased investment. This part of the thesis, however, has been rejected in subsequent research, based on estimates of economic activity that were not available when the thesis was formulated.
  
• 
  The tragedy of the Civil War is compounded by the fact that in 1860, the total market value of slaves was approximately $3.06 billion. The costs of the war were more than twice the cost of purchasing the slaves. This does not mean that peaceful abolition was realistic before the war.
  
• 
  The economic outcome of the war was a distinct reversal in the relative POSITIONS OF THE North and South. In 1860, the North’s real commodity output per capita was slightly less than the South’s. By 1870, the North’s per capita output exceeded the South’s by nearly two-thirds.
  
• 
  During the decline in the Deep South, firstly, the highly efficient plantation system was destroyed, and attempts to resurrect plantation methods proved futile. A second closely reason was the significant withdrawal of labor from the fields, especially labor by women and children. Finally, the growth of the demand for southern cotton slowed because of competition from India, Brazil, and Egypt, and because of the growth of world demand slowed. The decline in the Deep South immediately after the Civil War was to be expected. The tragedy was that southern agricultural production remained depressed for decades afterward.
  
• 
  Concentration on cotton production was not irrational. Stephen DeCanie has shown that the South had a comparative advantage in cotton production and that southern cotton farmers were about as responsive to price changes as northern wheat farmers were to wheat prices.
  
• 
  The recruitment and drafting of large numbers of men might have been expected to raise the real wages of those working on the home front by reducing the availability supply of labor, but this did not happen.
  
• 
  The South did not use slaves for fighting because both masters and slaves knew the enemy provided a route to freedom. Ironically, the efforts of slaves to grow cotton, spurred by the exceptionally high prices in the early 1860’s, was negated by the South’s trade policies to England. Most of this vital labor was simply wasted as high stockpiles of cotton rotted in the countryside and on the docks.
  
• 
  The Thirteenth Amendment to the Constitution freed all slaves; the Fourteenth Amendment ensured that no state shall deprive any person of life, liberty or property, without the due process of law and guaranteed that the right of citizens to vote shall not abridged. These amendments were passed soon after the war but were not sufficient to ensure sustained progress for blacks.
  
• 
  Land reform that broke up the plantations and gave the land to former slaves was pushed by Republicans in Congress. This might have set the South, and ultimately the whole country, on a different course. The House and Senate each passed a bill to give black heads of households 40 acres, but President Andrew Johnson vetoed it. Except in a few isolated areas such as the Sea Islands of Georgia and on the former plantation of Confederate President Jefferson Davis, where land reform proved to be a success in promoting stable farming communities, most of the land remained in the hands of the same people who had owned it before the war.
  

• 
  1800’s Government land policies including the homestead act of 1862. This policy gave 160 acres of land to one person, or 320 to a married couple. This was not terribly successful as the land available was good for cattle grazing and ranching which required more land. Only 1 acre in 5 belonged to a homesteader. 1873 The Timber-Culture act. This policy gave a person 160 acres of land if 40 were used to plant trees. 1877 the desert land act. This act gave640 acres at $1.25 an acre if the owner agreed to irrigate the land in three years. A problem with this act was the loose definition of irrigation. 1878 the Timber and Stone act. For $2.50 an acre a person could buy valuable timber and mining land in the northwest and west coast. 1878 the Timber-Cutting act. This allowed people of certain regions to cut down trees on government land for free, provided that the timber were used for agriculture, mining, or domestic building.
  
• 
  1880 Refrigerated railroad cars allowed for transport of perishable items such as dairy, meat, and fruits and vegetables. The cars allowed for region specific items to have a national market.
  

• 
  1857 Excerpt from the Scientific American “Every Farmer who has a hundred acres of land should have at least the following: a combined reaper and mower, a horse rake, a seed planter, and mower…a thresher and grain cleaner, a portable grist mill, a corn-sheller, a horse power, three harrows, a roller, two cultivators, and three plows. (Danhof 1951, 150)” this was a list of mechanical advancements made to help industrialize farming.
  
• 
  1867 The National Grange of the Patrons of Husbandry was formed, this was the first farm organization. By 1874 it had 20,000 branches and 1.5 million members. They work unofficially with reform parties in politics to pass agriculture friendly laws, and help farmers fight unfair business practices by getting farmers into business for themselves. The grangers were also responsible for the farmer’s cooperative markets where farmers could sell and buy from each other. At this time there were also independent farm clubs forming in the south and the west. These usually joined together to form state alliances which joined together to make the Northwest alliance and the Southern alliance. They each advocated monetary reform, government owned transportation, and cooperative business ventures. Below is a picture of a granger meeting found in the textbook on page 273.
  

• 
  Land, Water and Timber Conservation. 1907, President Theodore Roosevelt’s Achievements. 1901 Bureau of Forestry, in 1905 this became the United States Forest Service. Roosevelt appointed Gifford Pinchot to be chief advisor for conservation, they made a program for scientific forestry. The government also kept 75 million acres of land containing coal, phosphates and oil.
  

• 
  Few developments have captured the attention of historians and contemporary observers quite like the railroad. Fast and powerful, reaching everywhere, the railroad came to dominate the American Landscape and the American imagination. Trains became the symbol of modern America, epitomizing America’s economic superiority in an industrializing world.
  
• 
  The Gold rush of 1849 yielded knowledge about riches of the Pacific Coast and about the vast spaces that separated East from West
  

• 
  There were 3 ways to get to the West, all difficult, wagons trains had bad weather. Sea route via the Isthmus of Panama cut 6 to 8 month trip to as little as 6 weeks, but from the Eastern Port on the Isthmus to Panama City was 5 day journey by native dugout and mule back, and at Panama City, travelers might have a long wait before securing passage north. For those who could afford it, the best way to California was by clipper ship, which made the passage around the Horn in about 100 days.
  
• 
  Government participation was viewed as essential. It was assumed that while the profits to the nation would be enormous, the profits to private investors would be insufficient to compensate for the enormous uncertainty surrounding such project.
  
• 
  By 1853, congress was convinced of the feasibility of a railroad to the West Coast and directed government engineers to survey practical routes.
  

• 
  From Minneapolis to New Orleans, cities along the Mississippi River vied for the position of gateway to the west, boasting of their advantages while deprecating the claims of their rivals.
  
• 
  Civil war outbreak removed the proponents of the Southern routes from Congress, and in 1862, the Northern Platte River route was selected because it was used by the Pony Express Stages and Freighter Wagons.
  
• 
  Pacific Railways Act of 1862, Congress granted a charter of incorporation to the Union Pacific Railroad, which was authorized to build a line from Council Bluffs, Iowa, to the West of Nevada.
  
• 
  The government agreed to furnish financial assistance in 2 ways: 10 sections of public land were granted for each mile of track laid. The government agreed further to lend the companies certain sums per mile of construction, the loans were to be secured by First-Mortgage bonds.
  
• 
  Act of 1862 failed to attract sufficient private capital, the law was amended in 1864 to double the amount of land grants and to provide second-mortgage security of government loans, thus enabling the railroads to sell first mortgage bonds to the public
  
• 
  To encourage speed of construction, the Central Pacific was permitted to build 150 miles beyond Nevada line, later it was authorized to push eastward until a junction was made with the Union Pacific.
  
• 
  Last 2 years of construction were marked by storied race between the 2 companies to lay the most tracks.
  
• 
  The Union Pacific, relying on ex-soldiers and Irish immigrants, laid 1086 miles of track, the Central Pacific, relying on Chinese immigrants, laid 689 miles, part of it through the mountains.
  

• 
  All major lines tried to secure access to NY in the East and to Chicago and St. Louis in the west.
  
• 
  1877 Northerly Routes, the New York Central completed a through line from New York to Chicago by 1877, and Erie did the same only a few years later.
  
• 
  From 1864to 1900, the greatest percentage of track varying from 1/3 to nearly 1/2 of the Country's total annual construction, was laid in the Great Plains States.
  
• 
  Chicago became Chief railroad terminus, the center of web of rails, extending North, West, and South. STL, KC, MN, Omaha and Denver became secondary.
  
• 
  The Southeast and Southwest lagged both in railroad construction and in the combination of local lines into through systems.
  
• 
  The only Southern Trans mountain crossing utilized before 1880 was the Chesapeake and Ohio, except for the Southern, no main north-south line was completed until the 1890's.
  
• 
  It is interesting to note, however, that the total absolute mileage doubled in the 25 years preceding 1910.
  
• 
  Railroad construction had a strong influence on aggregate demand and business cycles. It accounted for 20 % of U.S. gross capital formation in the 1870's, 15% of the total in the 1880's and 7.5% of the total in each of the remaining decades until 1920
  
• 
  1920, railroad employment reached its peak.
  

• 
  The rapid but slowing pace of growth in construction is also seen in the gains in railroad productivity.
  
• 
  Total factor productivity of the railroad somewhat more than doubled in the 40 years between 1870 and 1910.
  
• 
  Despite the expected slowing of the railroads productivity advance, it continued throughout the period up to WWI.
  
• 
  The railroads were not, in themselves, the cause of America's rapid economic progress in the 19th century but for several generations of Americans, they symbolized the ceaseless wave of entrepreneurial energy and technology advance that was the cause of progress.
  

• 
  Joseph Schumpter, one of the leading economists of the early 20th century, argued that many midwestern railroad projects "meant building ahead of demand in the boldest sense of phrase" and that "Middle Western and Western projects could not be expected to pay for themselves within a period such as most investors care to envisage."
  
• 
  The implication of Schumpeter's argument was that government aid to the railroads was necessary in order to open the West.
  
• 
  Albert Fishlow tested Schumpeter's assertion by analyzing profit rates on railroad investments in the antebellum period.
  
• 
  Fishlows findings on all 3 tests failed to support Schumpeter's assertion that the railroads were built ahead of demand.
  
• 
  The Central Pacific and the Union Pacific had private rates of return above rates on alternative investments in the long run. The Texas and Pacific, the Santa Fe, and the Northern Pacific did not.
  
• 
  Interesting to note that the total absolute mileage doubled in the 25 years preceding 1910.
  
• 
  Railroad construction had a strong influence o aggregate demand and business. It accounted for 20% of U.S. gross capital formation in the 1870’s, 15% of the total in the 1880’s and 7.5% of the total in each of the remaining decades until 1920
  
• 
  In 1920, railroad employment reached its peak
  

• 
  Before the Pacific Railway Act of 1862, America’s largest manufacturing plants rarely had more than $500,000 invested in capital or as many as 1000 employees. In contrast, five railroads at that time each had more than $20 million invested and tens of thousands of employees.
  
• 
  Perhaps 175$ million in government bonds was loaned to the Union Pacific, the Central Pacific, and four other transcontinental, but after litigation, most of this amount was repaid.
  
• 
  Congress gave a portion of the unsettled lands in the public domain to the railroads in lieu of money or credit.
  
• 
  Land grant subsidies to railroads were discontinued after 1871 because of public opposition, but not before 79 grants amounting to 200 million acres, reduced by forfeitures to just over 131 million acres had been given.
  
• 
  However, that aid to the railroads was not given unconditionally. Congress required that companies that received grants transport mail, troops, and government property at reduced rates.
  
• 
  While land grant rates were in effect, the government obtained estimated reductions of more than 500$ million- a sum several times the value of land grants when they were made and about equal to what the railroads received in land grants with an allowance for the long run increase in the value of the land.
  
• 
  First examples of truly large corporations, railroad companies led the way in developing fundraising techniques by selling securities to middle class investors.
  
• 
  After civil war, these securities proliferated as railroads appealed to people who had been introduced to the investing through purchases of government debt during the war.
  
• 
  Conservative investors avoided the common stock of the railroads, the proliferation of such issues added tremendously to the volume of shares listed and traded on the floor of the NYSE.
  

• 
  Railroad promoters sometimes indulged in fraudulent practices.
  
• 
  Railroad contracted with a construction company to build a certain number of miles of road at a specific amount per mile then met the costs by paying cash that they obtained by selling bonds to the public, and issuing common stock to the construction company.
  
• 
  The system was easily abused
  
• 
  Not all railroad construction was financed through inside construction companies, but it was common especially during the 1860s and 1870s.
  

• 
  Major companies often faced no competition at all in local traffic and therefore had great flexibility in setting prices for relatively short hauls, but for long hauls between major cities there were usually two or more competing carriers.
  
• 
  Railroad managers were in charge of firm and high fixed costs
  
• 
  Rates were inflated when hauling empty cars, for shippers this practice was called “blackhaul problem”
  
• 
  Another form of rate discrimination arose when the same railroad was in a monopolistic position with respect to certain customers
  

• 
  Started in the early 1870s  the Granger movement = wanted regulation of railroads, grain elevators, and public warehouses
  
• 
  The legislation was known as the Granger Laws
  
• 
  The review of the laws by the Supreme Court was known as the Granger case
  
• 
  Munn v Illinois 1877
  
• 
  Supreme Court said that when businesses are “clothed with a public interest,” their regulation as public utilities is constitutional
  
• 
  Settled the constitutionality of the state regulation of railroads and certain other enterprises within the states – but not between states
  
• 
  1886 Wabash case – St. Louis and the Pacific Railway Company v Illinois
  
• 
  States could not regulate interstate commerce due to the fact that was given to the federal government based on the Constitution
  

• 
  1887 Act to Regulate Commerce
  
• 
  Brought all railroads engaged in interstate commerce under federal regulation
  
• 
  Railroads were to be just and reasonable
  
• 
  Prohibited personal discrimination. A lower charge could no longer be made in the form of a “special rate, rebate, drawback, or other device.”
  
• 
  No due preference of any kind should be accorded by any railroad to any shipper, any place, or any special kind of traffic
  
• 
  Enacted the pro rata clause of the Granger legislation by prohibiting greater charges “for the transportation of passengers or of like kind of property, under substantially similar circumstances and conditions, for a shorter than for a longer distance, over the same line, in the same direction, the shorter being included in the longer distance.”
  
• 
  Pooling was also prohibited
  
• 
  Created Interstate Commerce Commission (ICC)  the 1^st permanent independent federal regulatory agency
  
• 
  Commission was required to examine the business of the railroads
  
• 
  Charged with hearing complaints that arose from possible violations of the act and was empowered to issue cease and desist orders if unlawful practices were discovered
  
• 
  Required railroads to submit annual reports based on a uniform system of accounts
  
• 
  The commission was required to submit to congress annual reports of its own operations
  
• 
  Hepburn Act of 1906
  
• 
  Extended the jurisdiction of the ICC to private-car companies that operated joint express, tank, and sleeping cars
  
• 
  Services such as storage, refrigeration, and ventilation were also made subject to the controls of the commission
  
• 
  Shifted the burden of proof from ICC to the carriers
  

• 
  Argued that growth was a dynamic process of applying major technological advances, both invention and innovation, and that the railroad epitomized these growth-generating forces
  
• 
  Argued that the railroad was a “leading sector” in the nation’s “take-off” to modern economic growth
  
• 
  The measure of the direct effect on the economy of the railroad suggests that the output per capita counted for about 2 years’ worth of growth
  
• 
  This countered the popular belief that the railroads were indispensable to the economic growth of the US
  
• 
  Credit Mobilier of America :
  
• 
  The federal government in 1864 had chartered a “Union Pacific Railroad,” with $100,000,000 capital, to complete a transcontinental line west from the Missouri River. It offered to assist it by a loan of $16,000 to $48,000 a mile according to location, over $60,000,000 in all, and a land grant of 20,000,000 acres, worth $50,000,000 to $100,000,000. Even this offer attracted no subscribers: it meant building 1,750 miles of road through desert and mountain, at enormous freight costs for supplies, with frequent bloody encounters with Indians, and no probable early business to pay dividends.[1]
  
• 
  George Francis Train and Thomas C. Durant, a vice president of the Union Pacific Railroad, formed the Crédit Mobilier in 1864. The original company, Pennsylvania Fiscal Agency, was a loan and contract company chartered in 1859.[1] The creation of Crédit Mobilier of America was a deliberate attempt to falsely present to the Government of the United States and the general public the appearance that an independent (of the Union Pacific Railroad and its principal officers) corporate enterprise had been impartially chosen by the Union Pacific Railroad’s officers and directors to be the principal construction contractor and construction management firm for the Union Pacific Railroad project. It was created by the officers of the Union Pacific to shield the companies' shareholders and management from the then common charge that they were using the construction phase of the Union Pacific project (as opposed to the operating phase of carrying passengers and freight), to line their pockets in excess profits, profits which these corporate officers did not in fact believe would come to exist from the actual operation of the railroad. So they created a sham company to charge the U.S. Government extortionate fees and expenses for the construction of the line.
  
• 
  In simplified terms the Crédit Mobilier fraud worked in the following manner. The Union Pacific made contracts with Crédit Mobilier, paid by check, to build the Union Pacific railway. The Crédit Mobilier would use these checks to buy stock and bonds in the Union Pacific at par value, the crux to the whole fraud, and then would sell them on the open market to make huge profits. These construction contracts brought huge profits to the Crédit Mobilier, which was owned by Durant and the other directors and principal stock holders of the Union Pacific. The Crédit Mobilier would split these huge profits with the stockholders. The net result was that the U.S. Congress paid $94,650,287.25 and $50,720,958.94 respectively to the Union Pacific and Crédit Mobilier. This left $43,929,328.31 in profits, counting at par values the shares and bonds that Crédit Mobilier paid itself. The Crédit Mobilier directors reported this as a cash profit of only $23,366,319.81, a financial misrepresentation.[1][2]
  
• 
  If the Union Pacific’s corporate officers had openly undertaken the construction of the railroad themselves, this scheme (to make windfall profits immediately through the construction of the railroad), would have been exposed to public scrutiny, and it would have given proof of fraud to the opponents of the plan as an unprofitable venture. These opponents believed that the whole project was in fact an ambitious fraud to build a "railroad to nowhere" and to make tremendous profits doing so; all the while getting the United States Government to pay for it. And most importantly, to construct the railroad in such a way, and going to such locations, that the project had no regard for trying to create a worthwhile and profitable transportation enterprise when it was completed.
  
• 
  The principal means of the fraud was the method of indirect billing. The Union Pacific itself could and did present to the U.S. Government genuine and accurate invoices for construction costs, generated by Crédit Mobilier of America, and presented to the Union Pacific Railroad for payment. The railroad then prepared meticulously detailed invoices to the U.S. Government, requesting payment for these bills, accrued by the Union Pacific from Crédit Mobilier of America, for the construction of the line, with only a small additional fee over the cost stated on the Crédit Mobilier invoices, for the Union Pacific's overhead expenses,
  
• 
  Any audit of the Union Pacific and its invoices to the U.S. Government would have revealed no evidence of fraud or profiteering. Union Pacific was only accepting for payment genuine Crédit Mobilier invoices and was only applying an auditable overhead expense for management and administration during construction of the railroad.
  
• 
  The underlying fraud of a common and unified ownership of the two companies, as regards their principal officers and directors, was not immediately revealed. Nor was it immediately revealed that in every major construction contract drawn up between the Union Pacific and Crédit Mobilier, the contract’s terms, conditions and price had been offered (by Crédit Mobilier) and accepted (by the Union Pacific) through the actions of corporate officers and directors who were one and the same persons. Furthermore, the company sought, and was largely successful in maintaining, this fraud and its secrecy by giving discounted (well below the market value, of this highly profitable company) shares of stock (in Crédit) to members of Congress who also agreed to support additional funding for the railroad, when (through the excessive charges for building the line), the Union Pacific had to come back to the government for additional construction funds. For its time, it was a very sophisticated corporate scam, and it was, at the time, largely not illegal.
  

• 
  Rise of industrial manufacturing sector in the United States was a key feature of modern economic growth and development.
  
• 
  Agriculture expanded greatly during these times but fell relatively because of more rapid increases elsewhere.
  
• 
  Relative to the rest of the world, American gains in manufacturing output were also phenomenal.
  
• 
  In 1913 the U.S. accounted for more than 1/3 of the world’s industrial production
  
• 
  1865-1900, U.S. experienced tremendous economic growth
  
• 
  8 factors of economic growth
  

1. 
   Technology
   
2. 
   Natural resources
   
3. 
   Investment in Human Capital
   
4. 
   Capital
   
5. 
   New organizational business trade
   
6. 
   Economics of trade
   
7. 
   New energy sources
   

1860-61 - Water Power #1 Energy Source for Manufacturing

1870’s - Steam Power Surpassed Water

Coal

1920 80% of all industrial energy was from coal

Petroleum

1945 petroleum and natural gas became strategic fuels

Electricity

By WWI 1/3 of the nation’s industrial power was electricity

½ of urban dwellings had electricity

98% of farms were still burning kerosene lamps after dark

8. 
   Shifts in resource from lower to higher productivity uses
   

Ex. Boot and shoes industry

In the 1850s they started to make shoes shaped for the right and left foot

1857 Goodyear welt process

In 1871 Charles Goodyear patented his welting machine. The Goodyear welt, as it is now called, is a method of securing the upper and insole of a shoe. Shoes made in this way are still generally regarded as the highest quality, and the region is still the largest area of Goodyear welted manufactured shoes in the world.

Ex. Advances in metalworking machinery for steel processing, copper, and aluminum 1860-1810

Machine tools became automatic of semiautomatic

Compressed air and electricity were used to drive high-speed cutting tools and presses

• 
  Technological changes, investments in human capital, new energy sources that widened markets and brought new organizational business structures and economies of scale, and structural shifts in resources from lower to higher productivity uses all combined to cause these exceptional long term trends.
  
• 
  The boot and shoe industry, the second fastest growing in terms of value added per worker, was also markedly changed by invention and products standardizing innovations.
  
• 
  Improvements in steel processing and in nonferrous metals, especially copper and aluminum, made possible rapid advances in metalworking machinery, which jumped between 1860 and 1910 from the seventh largest to the largest manufacture.
  

• 
  Between 1860 and World War 1, there was a remarkable transition from reliance on the power of wind and water and the physical exertion of humans and animals to other sources of energy.
  
• 
  1870, steam surpassed water as a source of power.
  
• 
  Another way of utilizing the force of water flow was to be devised.
  

• 
  Between 1869 - 1899 agriculture & manufacturing flip-flopped in their % of the economy
  
• 
  By 1914 the industry was industrialized
  
• 
  This era became known as the Second Industrial Revolution
  

In 1899: 33% agriculture 53% manufacturing 14% mining and construction

• 
  1860-1910 - All major sectors of the economy grew but railroads grew most (more than 23 times)
  

First U.S. legislation enacted to curb concentrations of power that restrict trade and reduce economic competition.

Proposed by Sen. John Sherman, it made illegal all attempts to monopolize any part of trade or commerce in the U.S.

Section 1. Trusts, etc., in restraint of trade illegal; penalty

Every contract, combination in the form of trust or otherwise, or conspiracy, in restraint of trade or commerce among the several States, or with foreign nations, is declared to be illegal . . .

Section 2. Monopolizing trade a felony; penalty

Every person who shall monopolize, or attempt to monopolize, or combine or conspire with any other person or persons, to monopolize any part of the trade or commerce among the several States, or with foreign nations . . .

• 
  Sherman Act enforced by the US Attorney General/Justice Dept. by pursuing either civil and/or criminal charges
  
• 
  Actual meaning of Act left to the courts
  
• 
  Initially Sherman Act not enforced against business corporations - Initially used against trade unions
  
• 
  In time, Sherman Act used to prosecute monopolistic companies
  

• 
  1880’s/90’s labor statistics 2.5 million women working 1900 it increases to 5.3 million 1920 8.5 million
  

1905 AFL (American Federation Labor) had 1.5 million member

• 
  1886 Haymarket Affair. This was an altercation between labor activist and police in Chicago. A bomb was thrown to disrupt a meeting. Several people died as a result. Seven men who were probably innocent were executed as punishment for the attack. It was used by both labor activists and anti-unionists to promote their separate agendas.
  
• 
  1892 a strike at the Carnegie Homestead Works was turned violent when Henry Frick, a close associate of Carnegie, brought in Pinkerton detectives to help stop the strike. The union won the battle but ultimately lost the war because the Pennsylvania state militia was called in to stop the violence.
  

• 
  Coinage
  

• 
  Paper Money
  

• 
  Panic of 1907
  

• 
  Federal Reserve
  

Was brought into effect in 1907. Which allows banks to issue emergency currency to be substituted instead of gold.