“Robber Barons” Harvey Wasserman’s “Robber Baron” is a harsh critic of not only legendary titans in the American business history, but also of the politics and politicians of the Gilded Age. In his monograph, the images of “robber barons”, corrupt politicians and laissez-faire government is conjured in the era wherein many important sectors of the American economy were dominated by a handful of firms as cut-throat business competition were compounded by frequent economic contractions that gripped the nation.
Wasserman accused the captains of industry of financial trickery and of political corruption with the bribing of legislatures, and attacking them for the inhumane treatment of labor which included the imposition of heavy hours, unhealthy working conditions and using cheap immigrant labor to undercut wage rates. But above all, Wasserman condemned them as merciless monopolists who engaged in ruthless competition by choking off rivals using railroad rebates, controlling raw materials and money supply, and the forced purchase of competing firms.
According to Wasserman, Carnegie, Rockefeller, Morgan, and Vanderbilt all had something in common – they were all “Robber Barons” who monopolize the railroad, petroleum, banking, and steel industries, profiting massively and gaining personally, but not doing a whole lot for the common wealth. Many of the schemes and techniques that are used today to rob people of what is rightfully theirs, such as pensions, stocks, and even their jobs, were invented and used often by these four men.
Wasserman’s narrative relentlessly pursue troubling and crippling side effects of the Gilded Age: high levels of political corruption, the arrogance of global economic power, the twisting of the U. S. tax code, and the voter belief in the captivity of government to private interests. But is it fair to consummate in totality, as per Wasserman, these early industrialists as “robber barons” and the business practices of the Gilded Age as completely corrupt and pointless?
The stereotype is indeed irresistible, especially so that it resonates in our time with the Enron, WorldCom and other corporate debacles. But nonetheless, Wasserman’s critique of capitalism is one-sided and obscures other dimensions of corporate activity and opportunity during the era. Take for instance, the doubling of the number of farms and the amount of land in cultivation during the period, the increased size of the workforce, especially in the manufacturing sector, the increased railroad track mileage and the swelling of steel production – all pointed to a surging Gross National Product (GNP).
With increased life expectancy, economic data proved that industrialization indeed did raise the standard of living for the majority of Americans during that era. The railroads that became the point of contention between business moguls, was the definite symbol of industrialization as it lowered the cost of shipping freight, which in turn permitted the reduction in the prices consumers paid for food and durable items, thus creating the evolution of national markets that stimulated new levels of competition, opportunity and further growth.
Although it still remains an endless debate as to the exact preposition that beholds the likes of Carnegies, Rockefeller, Morgan and Vanderbilt, it is beyond doubt that corporations, a number of which were owned by these men, were the engines of economic growth. In the 40 years following Appomattox, the United States amazed European investors and bankers with the speed at which she changed from a backward agricultural republic to the most powerful industrial force in the world.
During the years of the so-called “robber barons”, America outpaced other nations by large margins when it came to growth in per-capita income, industrial production and rising values generally. Moreover, the Gilded Age also saw economic participation at all levels of society, including numerous previously disenfranchised constituencies. Thus, it is worth noting, Wasserman’s narrative, along with that of Charles Beard and Matthew Josephson (the original creator of the “robber barons” dichotomy), needs a further reassessment.
From Wasserman’s narrative, it is easy to reach the conclusion that the post Civil War program providing subsidies to western railroads was a disaster, a way of transferring millions of the people’s wealth to a few politically well-connected plutocrats. Seemingly, it would have been attempted. But when all the dust settled, the United States did have a transcontinental railroad. Without the offer of mammoth government subsidies, such railroad construction would not have happened for decades.