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Reconstruction
The Republican policies of Reconstruction and Southern Democratic resistance to black civil rights was an issue in the presidential elections of 1868, 1872, and 1876. Many scholars consider Reconstruction the major issue of the 1868 campaign. The question before the electorate was whether Reconstruction would be continued under Republican nominee Ulysses S. Grant or rolled back under Democratic nominee Horatio Seymour. Salmon Chase advocated black manhood suffrage, but lost the Democratic nomination.

Both parties tried to sidestep that important issue. The Republican platform in 1868 endorsed the Reconstruction policy of requiring black manhood suffrage in the former Confederate states, while leaving the Northern and border states free to decide the matter. The Democratic platform condemned "Negro supremacy" and demanded a restoration of states' rights without specifically mentioning suffrage. The readmission of several Southern states with large black electorates, however, forced the question into the forefront.

In the 1872 and 1876 campaigns, Democrats accepted Reconstruction as a fait accompli, but wanted the federal troops in the South removed from policing politics. Republicans offered no policy initiatives for blacks or the South, but publicized the violence that Southern blacks and their white Republican supporters faced. Although often sincere, and certainly based in fact, it was part of the Republican strategy of "waving the bloody shirt"-i.e., associating the Democratic party with secession and the Confederate cause.

Nativism
The decade from 1845 to 1854 saw the greatest proportionate influx of immigrants in American history. By 1860 more than one out of every eight Americans were foreign-born, with the most numerous being Irish, German, and English immigrants. When the wave of immigration began, the United States was an overwhelmingly Protestant nation whose citizens were affiliated primarily with Protestantism's evangelical wing. Most American Protestants held deep-seated prejudices against Roman Catholicism, which was the religion of most of the Irish and a large segment of the German immigrants. It was assumed that the Catholic immigrants' first loyalty would be to Rome, not their adopted country, and that Catholicism would undermine America's political and religious liberties.

Several anti-immigrant groups formed to promote the severe restriction of immigration (at the time, America's borders were open to all) and the substantial lengthening of the naturalization process of becoming citizens. The most important of the anti-immigrant, or nativist, organizations was the Order of the Star Spangled Banner, founded in 1849. Within a few years it had grown into a formidable political party called the American party. It became popularly known as the "Know-Nothing" party because when asked about the organization, members were to reply, "I know nothing."

In the turbulent political circumstances of the mid-1850s, the American party sometimes served as a way station between the crumbling Whig party and the emerging Republican party for those who considered slavery and Catholicism to be twin-evils that threatened the nation. In the 1854 and 1855 elections, the American party made a strong showing, electing over 100 Congressmen, eight governors, several mayors of major cities, and thousands of state and local officials. The party soon collapsed, however, as slavery became the major issue in American politics and as the new Republican party captured the loyalty of most slavery opponents.

Chinese in America were another immigrant group that faced prejudice and discrimination in the late-19th century. The Burlingame Treaty of 1868 allowed a free flow of immigration between China and the United States. The Chinese population in the United States, located primarily on the West Coast, remained tiny, but racial prejudice and economic competition roused intense and sometimes bloody reaction against them.

During the 1870s several measures were introduced into Congress to limit or prohibit Chinese immigration. The 1876 Democratic platform condemned the "coolie-trade" and "the incursions of a race not sprung from the same great parent stock." The 1876 Republican platform called on Congress "to investigate the effects of the immigration and importation of Mongolians on the moral and material interests of the country." Finally, in 1882, Congress passed the Chinese Exclusion Act which banned all Chinese immigration to the United States for ten years (extended by subsequent laws) and prohibited Chinese already resident in the United States from being American citizens. For more information, visit HarpWeek's site on "The Chinese American Experience, 1857-1892."

The Tariff Question
The public debate over tariffs (federal duties on foreign imports) had existed since the early days of the republic, but reached a peak in the late-nineteenth and early-twentieth centuries as the United States became increasingly industrial, urban, and connected to world markets. Trade protectionists argued that high tariff rates discouraged the importation of foreign goods, thereby allowing American industry to expand and prosper, the American economy to strengthen, and jobs to be created and maintained for Americans. Trade reformers countered that high tariff rates benefited only narrow economic interests at the expense of others segments of the U.S. economy, inflated the prices consumers paid for goods (thus increasing the cost of living), hampered the national economy, and increased international tension. Most tariff reformers advocated lowering tariff rates so that they were only high enough to raise revenue for the federal government. Trade protectionist often erroneously charged the reformers were “free traders” who wanted to eliminate all tariffs.

The two major political parties were internally divided on the tariff question. However, in the 1880s, Republicans began emerging as the party of trade protection and Democrats became more closely associated with tariff reform. Senator James Blaine helped convince the GOP to emphasize trade protection late in the party’s national campaign of 1880 and made it a cornerstone of his own presidential campaign four years later. At the same time, he favored the mutual lowering of some tariffs through reciprocal trade agreements with select nations, particularly in Latin America, in order to strengthen commercial ties between those countries and the United States. In the Democratic Party, Grover Cleveland won the presidential nomination in 1884 partly because his ambiguous stance on the tariff issue made him acceptable to both trade protectionists and reformers within the party. Under his guidance as president (1885-1889, 1893-1897), though, the Democratic Party became identified with tariff reform. Nevertheless, there remained minority factions of trade protectionists in the Democratic Party and tariff reformers in the Republican Party.

In 1882, Republican President Chester Arthur had established a commission to study the tariff question. Its report advised sharp rate reductions, but the “Mongrel Tariff” passed by Congress in 1883 lowered the overall rate by only 1 percent. In December 1887, Democratic President Cleveland used his annual message to Congress to appeal for a reduction in the nation’s high tariffs. An administration-backed bill passed the House in early 1888. It and a Senate Republican alternative were debated fiercely during that year’s presidential campaign, but neither proposal became law.

At the 1888 Democratic National Convention an intense backroom fight over the tariff plank in the party platform ended with victory for the reformers when a tariff-for-revenue-only policy was ratified. Meanwhile, the Republican Party reaffirmed its commitment to trade protection and reciprocity. After Republican Benjamin Harrison defeated Cleveland, the new president appointed Blaine secretary of state, and he negotiated several reciprocal trade agreements with Latin American nations. Republican control of Congress allowed passage of the McKinley Tariff Act of 1890. Sponsored by Congressman William McKinley, the protectionist law raised tariff rates to an average 48%, the highest peacetime level in American history to that date. It provoked a popular backlash resulting in the Republican loss of the House of Representatives that November.

In 1892, the Democratic Party again declared for tariff reform and nominated Cleveland for president. After returning to office, President Cleveland worked with Congressman William Wilson to introduce a tariff reform bill in December 1893. The Wilson Tariff, which would have lowered the overall tariff rate by 15%, passed the House in February 1894. Senator Arthur Pue Gorman, a Democrat protectionist, transformed the legislation into a high-tariff bill. The final compromise version cut overall rates by only 7% and actually increased duties on many items. It passed in July and became law without the president’s signature. In 1896, Republicans regained the White House under William McKinley and majorities in both houses of Congress. In 1897, they enacted the Dingley Tariff Act, which raised the average rate to 46% (from the previous 41%).

The high-tariff policy remained in place while the GOP was dominant in national politics during the early-twentieth century. However, in 1908, Republican presidential nominee William Howard Taft and the party platform endorsed revising tariff policy to make it more equitable. The next year, President Taft called Congress into special session to enact tariff-reform legislation, resulting in the Payne-Aldrich Tariff Act. It lowered the overall tariff rate by only five percent (to 41%) and raised rates on crucial resources like coal and iron ore. Although not as substantial as Taft had hoped, it was the first successful attempt at tariff reform in 15 years. The law also included the president’s suggestion of a tariff commission to study rates and recommend further changes. A split in the Republican Party in 1912 between Taft and former president Theodore Roosevelt allowed Democrat Woodrow Wilson to win the White House. In 1913, President Wilson signed into law the Underwood Tariff Act, which reduced the average rate from 41% to 27% and expanded the free list to include iron and steel, among other major items.

The Trust Question (Business Monopoly)
Business enterprises had, of course, existed in America since colonial days, and industrialization had been underway since the early-nineteenth century. It was in the late-nineteenth century, however, that technological advances and economic needs combined to facilitate the emergence of the large business corporation. In that transitional period from an agrarian society to an industrial one, the vast majority of business firms remained small, while a few giant corporations received most of the attention.

Before the Civil War, most businesses were necessarily local in scope and limited in personnel and product line. The railroad and telegraph diminished the obstacles of space and time in the sprawling nation, enabling the development of national markets and the establishment of business corporations which could plan, communicate, coordinate, and distribute their products nationally, and even internationally. Other inventions or innovations, such as electrical power and steel processing, further advanced the productivity and diversity of American business and industry. The dramatic growth of the urban population in the post-war decades provided expanding markets for more, new, and improved goods, and stimulated mass merchandizing, mass production, and mass distribution. By 1900, the United States was the leading industrial nation in many fields.

Large business corporations arose in industries dominated by a few companies, such as railroads, petroleum, steel, meatpacking, and tobacco. These enterprises required a hierarchy of managers and a tremendous amount of capital investment, especially for equipment, buildings, and other overhead costs. The latter often made the competition for revenue between firms fierce, leading to overproduction or price reductions that threatened the solvency of the companies. One strategy for preventing the frequent bankruptcies was the establishment of (sometimes secret) trade associations called “pools,” in which firms in a given industry agreed to cooperate by regulating their rates and dividing the market.

Pools were often unsuccessful, however, so business mergers became an effective alternative. John D. Rockefeller’s Standard Oil Company, for example, bought up other petroleum companies, so that by the late 1870s he controlled 90% of the nation’s oil industry. Standard Oil also formed a legal trust, through which a board of trustees held stock in all subsidiary companies. Other firms expanded vertically by buying or creating companies in other areas of the flow of goods; for example, Carnegie Steel purchased mining operations and Singer Sewing Machine Company opened retail stores.

Although large corporations were a small minority of American businesses in the late-nineteenth century, their substantial size and influence on the American economy, their often clandestine deal-making, and their sheer novelty on the economic landscape were among the factors provoking fear and heated rhetoric among critics. Political movements, like the Grangers and the Populists, arose to combat what they perceived as the problems resulting from business consolidation. State governments began creating regulatory commissions, primarily aimed at railroad companies, but in 1886 the U.S. Supreme Court ruled that only Congress was constitutionally authorized to regulate interstate commerce. The next year, Congress enacted the Interstate Commerce Act, which established the first federal regulatory commission.

In January 1888, the first of several antitrust bills was introduced in the U.S. House of Representatives. Although none of the proposals made it out of committee, Senator John Sherman, an Ohio Republican, drafted a bill that passed Congress in June 1890 with only one dissenting vote. The sweeping but vague language of the Sherman Antitrust Act outlawed any “restraint on trade,” and subjected violators to fines or prison. At first, the federal government instituted only a few lawsuits, and in 1895 the Supreme Court limited the scope of the law. Business consolidation actually picked up pace, so that the period from 1893 to 1904 is sometimes called the “Great Merger Wave” for the record number of business mergers.

In 1900, the Democratic National Platform declared that imperialism was the “paramount” issue, but in his September 18 letter officially accepting the presidential nomination, William Jennings Bryan emphasized the trust question. He charged that the Republican Party was the “sponsor at the cradle of more trusts than ever sprang into existence before.” Bryan’s antitrust attack was blunted by national economic prosperity, President McKinley’s forceful remarks against monopolies and for further antitrust legislation, and by Bryan’s association with Democratic politicians who had ties to trusts.

When McKinley was assassinated in September 1901, the presidency of his successor, Theodore Roosevelt, ushered in a new era of federal regulation of business. In his first annual message to Congress in December 1901, Roosevelt acknowledged both the social benefits and problems resulting from the emergence of large business corporations. Although he soon earned the nickname, “Trustbuster,” his preference was for the federal government to regulate, rather than prohibit or dismantle, big business. Nevertheless, in February 1902, Roosevelt’s Justice Department sued in federal court under the Sherman Antitrust Act to break up J. P. Morgan’s railroad trust, the Northern Securities Company. Two years later, the Supreme Court ruled 5-4 that the company was in violation of the federal antitrust statute. The case was the first of 45 antitrust suits filed during Roosevelt’s presidency (1901-1909). An even larger number of antitrust lawsuits were advanced effectively by the presidential administration of Republican William Howard Taft (1909-1913). The most notable result was the breakup of Standard Oil and the American Tobacco Company in 1911.

While large business corporations aroused fear and concern, most Americans willingly accepted the dazzling array of product choices and services they offered, as luxuries were transformed into commonplace items through mass production and lower consumer prices. For all the attendant problems that industrialization and business consolidation brought, by the early-twentieth century the United States had the most productive economy and the highest standard of living in the world.

 

 
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