4.3 Gilded Age Responses

Organizing Against Big Business

The wealth of the Gilded Age rested on long hours, low pay, and dangerous conditions. NYSED Key Idea 11.5 asks how workers and farmers responded to concentrated economic power. Two movements dominate the exam: labor unions representing industrial workers, and the Populist movement representing farmers. Understand what each group wanted, the tactics they used, and why most of their early efforts failed against businesses backed by the courts and government.

Labor Unions: Knights of Labor vs. AFL

The first major national union was the Knights of Labor, founded in 1869 and led by Terence Powderly. It was strikingly inclusive: it welcomed skilled and unskilled workers, women, and (in principle) Black workers, and it sought broad goals like an eight-hour day, an end to child labor, and worker-owned cooperatives. Membership surged to about 700,000 in the mid-1880s but collapsed after the union was blamed for the Haymarket Affair (1886), a Chicago labor rally where a bomb killed police officers and turned public opinion against radical unionism.

Into that vacuum stepped the American Federation of Labor (AFL), founded in 1886 and led for decades by Samuel Gompers. The AFL took the opposite approach: it organized only skilled craft workers into trade unions and pursued narrow, practical "bread and butter" goals — higher wages, shorter hours, and better conditions — through collective bargaining. This focus made the AFL more durable than the Knights.

Strikes and Their Outcomes

Strikes were labor's main weapon, and the Regents expects you to know that most late-1800s strikes failed, because owners could call in private guards, courts issued injunctions, and presidents sent federal troops.

• Great Railroad Strike of 1877 — the first nationwide strike, broken when President Hayes sent federal troops.
• Haymarket Affair (1886) — a bombing during a Chicago rally that discredited the Knights of Labor.
• Homestead Strike (1892) — steelworkers at Carnegie's Homestead plant fought Pinkerton guards; the strike was crushed and the union destroyed.
• Pullman Strike (1894) — railway workers led by Eugene V. Debs were stopped by a federal court injunction and troops sent by President Cleveland to keep the mail moving.

The Populist Movement

Farmers faced falling crop prices, high railroad rates, and heavy debts. They first organized through the Grange in the 1870s (winning "Granger laws" that regulated railroads) and then through the Farmers' Alliance, which grew into the People's (Populist) Party in 1892. The party's Omaha Platform (1892) is one of the most-tested documents of the era. Its demands included:

1. Free and unlimited coinage of silver (bimetallism) to expand the money supply and raise crop prices.
2. A graduated income tax on the wealthy.
3. Government ownership of railroads, telegraphs, and telephones.
4. Direct election of U.S. senators (later achieved by the 17th Amendment).
5. A secret ballot and other democratic reforms.

In 1896 the Populists backed Democrat William Jennings Bryan, whose "Cross of Gold" speech championed silver, but he lost to Republican William McKinley and the party faded. Yet many Populist ideas — the income tax, direct election of senators, railroad regulation — became law during the Progressive Era, so Populism is best seen as a bridge to Progressivism.

The Money Question and Railroad Regulation

To understand Populism you must grasp two economic grievances the Regents tests. First, the money supply: because U.S. currency was tied to a limited gold standard, prices slowly fell (deflation), which meant debtors had to repay loans with dollars worth more than the ones they borrowed. Farmers wanted "free silver" — coining silver freely alongside gold — to inflate the money supply, raise crop prices, and ease their debts. Bankers and industrialists defended gold as "sound money." Second, railroad rates: the Grange won early state "Granger laws," upheld in **Munn v.

Illinois (1877)**, establishing that states could regulate businesses affecting the public interest. After the Supreme Court limited state power over interstate lines, Congress responded with the Interstate Commerce Act of 1887, creating the Interstate Commerce Commission (ICC) — the first federal regulatory agency. These fights show farmers demanding, and slowly winning, government intervention in the economy.

The Sherman Antitrust Act of 1890

The first federal attempt to limit big business was the Sherman Antitrust Act of 1890, which declared illegal "every contract, combination... or conspiracy in restraint of trade." On paper it outlawed monopolies; in practice, early enforcement was weak. In United States v. E.C. Knight Co. (1895) the Supreme Court narrowed it so far that it barely touched manufacturing monopolies, and courts perversely used it against labor unions, calling strikes illegal restraints of trade. Real antitrust enforcement waited for Theodore Roosevelt and the Clayton Antitrust Act of 1914 (Section 4.4).

Common Traps

• Knights = everyone; AFL = skilled workers only. The AFL's narrow focus is why it survived.
• Most Gilded Age strikes lost; do not assume workers won.
• The Sherman Act (1890) was passed but rarely enforced at first — and was even turned against unions.