The Tycoons: How Andrew Carnegie, John D. Rockefeller, Jay Gould, and J. P. Morgan Invented the American Supercompany
Page 23
Things are seldom what they seem;
Skim milk masquerades as cream;
Lard and soap we eat for chease;
Butter is but axle-grease.
A vast range of products made life simpler: Bissell carpet sweepers, Gillette “safety” razors with disposable blades, rubber boots and shoes, zippers, ice boxes (often with an opening on a house’s outer wall, so the iceman could fill it), Levi’s for workers. Or made life more fun: roller skates were a craze in the 1870s; bicycles in the 1890s. James Bonsack’s automatic cigarette-making machine went into production in James Duke’s factory in 1886. By 1900, Americans were buying more than four billion cigarettes a year, almost all of them from Duke, including still-current brands like Lucky Strike. A pre-Duke cigarette maker invented the baseball card. Young women were discouraged from smoking, but had a “mania” for cosmetics. Handbag stores prestuffed their bags with branded lipsticks and rouge. Helena Rubinstein and Elizabeth Arden, between them, dominated the business by the early 1900s. Household walls were festooned with chromolithographs, color facsimiles of paintings by American artists such as Audubon, Bierstadt, and Winslow Homer. Currier and Ives were among the first to produce paintings specifically for chromolithography. Mark Twain’s Connecticut Yankee knows he is in a strange place because the medieval castle has no “chromos” on the walls.
Residential mail service triggered a postcard craze, and then a greeting card craze. Postcards with photographic scenes were popular collectibles; one company produced 16,000 different views. Thomas Edison invented the phonograph in 1879, but Emile Berliner came up with the popular “gramophone” and the flat “record” in 1889; his system could make thousands of records from a single master. Versions of the modern jukebox proliferated in the 1890s, and it was a natural accompaniment to the drugstore soda fountain—a pharmacist could pull in $500 worth of nickels a week. Both were an index of the increased leisure time of young people. Middleclass parents kept their kids in school instead of sending them off to the factory, and were discovering that the demographic between child and adult was a previously undreamed-of species.
Home entertainment sales boomed—lawn tennis and croquet, board games, and stereoscopes. Two stereoscopic slides viewed in front of a light source produced a three-dimensional scene. Millions of slides were produced—natural wonders, stories, religious matter; Oliver Wendell Holmes, Jr., once boasted that he had seen more than 100,000 stereo views. George Eastman introduced the celluloid film roll for his Kodak in 1888. A Kodak-sponsored photography contest in New York in 1897 drew 26,000 people. By 1900, the country had more than 1.5 million telephones. Improvements in printing technology produced an outpouring of magazines, inexpensive novels, and city newspapers. Plant lighting made morning papers possible, and publishers pulled in readers with sports pages, comics, puzzles, women’s pages, and advice columns. Dorothy Dix’s column started in 1896. Professional entertainment—baseball, boxing, vaudeville, burlesque, Barnum’s circus, and the “Amusement Park”—were fixtures even in smaller cities. The Ferris wheel at the 1893 Chicago Exposition was 264 feet high, each of its cars was larger than a Pullman coach, and the fully loaded wheel handled more than two thousand people at a time.
Armory Practice Redux
The full wealth effects of a mass consumer society are not captured by raw income data. It’s not just that the average person has more money, but that technology creates entirely new classes of products while radically reducing the cost of products once available only to the elite. In that respect, the American consumer boom represented the final flowering of the Connecticut Valley machine tradition of Thomas Blanchard, John Hall, and the great superintendents at the Springfield Armory. The woman who breaks the bobbin on her sewing machine while running up curtains at home and the soldier in the field with a broken gunlock present a common problem—neither can get full value from their product if it requires the attendance of a skilled craftsman. Isaac Singer’s worldwide distribution of his sewing machine was a new chapter in consumer marketing, but it was not until the 1880s that he finally understood the requirements of consumer support. Singer’s business went through painful adjustments for much of that decade to bring its output closer to Armory standards of precision: if a part breaks, just screw a new one in. The bicycle industry that fed the cycling enthusiasm of the 1880s and 1890s was one of the first where manufacturers understood the importance of Armory standards from the outset, and nicely illustrates the direct gene transfer from Valley practice to mass consumer manufacturing.
The “father” of the bicycle in America was Albert A. Pope, a Boston merchant who became infatuated with bicycles when he saw a British high-wheel cycle at the 1876 Philadelphia Exposition. He traveled to Europe, learned how they were manufactured, and returned to create a bicycle industry in America. Pope seems to have understood the opportunity for a mass production industry from the very start, because he was determined that, unlike the European products, his would be produced with “interchangeable parts,” an advantage he promoted in his earliest brochures.
Pope contracted production of his first bicycles to the Weed Sewing Machine Co., which, along with Singer and Willcox & Gibbs, was one of the three original sewing machine makers. Both Weed and Willcox & Gibbs used manufacturers directly from the Valley community—Brown and Sharpe for Willcox & Gibbs, and the Robbins & Lawrence/Sharps Rifle Co. for Weed. Robbins & Lawrence had worked closely with Simeon North, the first outside contractor for John Hall’s rifles; and it was a Robbins & Lawrence rifle that took the gold medal at the 1851 Crystal Palace Exhibition. But Weed and Willcox were better technologists than marketers, and never won more than a small percentage of the trade—although by the time Pope contacted them, Weed had taken over the Sharps factory and was producing sewing machines as its main line business.
A superb businessman and marketer, Pope bought up every American bicycle patent he could find and evangelized his cycles by financing bicycling magazines and sponsoring bicycle clubs, competitions, and trade shows. He organized local pressure groups, coordinated through his “American Wheelmen’s Association,” to demand better roads, and his bicycle posters, some by Maxwell Parrish, became popular artwork. Pope achieved impressive volumes even with his high-wheelers, which were an athletic challenge and a bit dangerous—more of a sport than a means of transportation. Business really took off with the introduction of the “safety bicycle,” essentially the same design as a 1950s Schwinn. Almost anyone could ride it.
Pope introduced his Columbia safety bicycle in 1890 and bought out the Weed company to bring manufacturing within his own control. While Weed was an excellent manufacturer, it had never strayed far from established Armory practice and always maintained other manufacturing lines. Pope eliminated all nonbicycle production, reorganized the plant, and introduced innovations in forging, assembly, and especially in finishing processes, where consumer markets posed much more demanding challenges than arms makers had faced. By the mid-1890s, American bicycle production was in excess of 1.2 million units a year. Pope wasn’t always the largest producer, but he never lost his reputation for the highest quality. Almost all of his competitors were also from the Connecticut sewing machine and small arms tradition. Important manufacturing innovations from other bicycle companies included steel stamping and primitive assembly lines, all critical, if groping, first steps toward the mother of all mass production systems—that for Henry Ford’s Model T, now less than twenty years away. Pope himself was an early experimenter with automobile manufacture, and may also have made the first commercial motorcycle (with a regular bicycle chain if the motor failed).
The early 1890s now feels like a long-ago era. That is why pictures and descriptions of the “Model Home” at the 1893 Columbia Exposition’s Electricity Building are so surprising. It has electric lighting, electric stove, hot plate, electric washing machine, electric carpet sweeper, electric doorbells and fire alarms. In short, it looks like us. Ordinary people were reaping the benefits of the va
st constructions of the Gilded Age titans. Not at all paradoxically, large-scale infrastructure allowed many consumer industries, like paints, furniture, and household tools and utensils, to achieve competitive efficiencies at quite modest scales. Electricity liberated smaller manufacturers from the tyranny of the steam engine or the water run. The city of Cleveland, for example, became a major center of venture-backed electricity-related manufacturing in the last quarter of the century, more or less replicating the development pattern around the Connecticut River fifty years before. Midsize manufacturers achieved access to national markets through the agency of large-scale retailers. As a Sears executive later put it with considerable insight, their success came from concentrating “money, organization, and brains in the distribution field, and, paralleling that, the growth of efficiency of the small manufacturer.” A Sears or a Wanamaker was an impresario of brand competition, presiding over a free-for-all in price, quality, and variety that spiraled into the massive outpouring of goods of a modern mass consumption society.
The country that had been trembling on the brink of modernity at Lincoln’s death, discovered thirty years later that it had made the leap. And it was scary.
Anxiety
The flip side of American fluidity was status anxiety. The sure connections between one’s father’s place in society and one’s own, the reliable guides to behavior so firmly attached to one’s station, were all gone. The psychological costs could be heavy. De Tocqueville, as usual, was one of the first to note it:
Thus not only does democracy make every man forget his ancestors, but it hides his descendants and separates his contemporaries from him; it throws him back forever upon himself alone and threatens in the end to confine him entirely to the solitude of his own heart.
But it was not just the individuals seeking their own way who were anxious. Here is the longtime quasiofficial moralist, Henry Ward Beecher, in the 1840s, sounding much like a modern-day imam:
We grade our streets, build our schools, support all our municipal laws, and the young men are ours; our sons, our brothers, our wards, clerks, or apprentices. . . . [But there is] a whole race of men, whose camp is the Theatre, the Circus, the Turf, or the Gaming Table . . . a race whose instinct is destruction, who live to corrupt, and live off the corruption which they make. . . . and when they offer to corrupt all these youth . . . and we get the courage to say that we had rather not; that industry and honesty are better than expert knavery—they turn on us in great indignation with, Why don’t you mind your own business—what are you meddling in our affairs for?
The irony, or poignancy, in Beecher’s fulminations is that he was so vulnerable himself. Although his advice manuals roundly condemned seducers, he was famously involved in a seduction scandal with a member of his congregation in the 1870s. He appears also to have been an addicted shopper. His compulsive lecturing, commanding top-market fees for endless rounds of selling prudence and frugality, was in part to keep up with his compulsive spending. One hopes he was a tortured soul—it would at least inspire sympathy.
America had once been an archipelago of small towns in which hierarchy commanded deference and local opinion bounded behavior. But the country’s extraordinary social and geographic mobility was creating a horizontal society. When every man or woman is free to constantly recreate himself or herself, one never knows who one should be or, just as frightening, whom one is meeting. In her wonderful study, Confidence Men and Painted Women, Karen Halttunen describes the elaborate social rituals that developed during the American Victorian era, the nervously managed systems of social signaling to identify who was real, who was fake, who was dangerous.
Anxiety was compounded by the rapid shift to paper-based wealth. Herman Melville’s 1857 novel The Confidence Man, set on a steamboat trip, becomes a kind of “Ship of Fools,” as passenger vignettes compound into an escalating series of paper swindles. Fear of deception led to a cult of candor and simplicity in midcentury, then, comically, to paroxysms of anxiety as it dawned that the truly deceitful person would appear the most sincere of all—which prompted an absurd outpouring of instruction on spotting the dishonest person by his face or her hands. By the 1870s, the middle classes may have been gaining their sea legs, for they began poking fun at their own canons of correctness and accumulating pomposities.
But there were grounds enough for middle-class anxiety, some of which struck at core features of traditional family life. Maintaining firm domestic control over children, and investing in their educational advancement—key elements in the middle-class life strategy—was feasible for most couples only with small families. Not only were they forgoing economic contributions from their children but they also were stretching out the period of dependence. William Dean Howells’s Basil and Isabel March are better off than most of the middle classes, and clearly enjoy their lifestyle—Isabel’s ability to pursue literary activities, the flexibility to consider the move to New York. One cannot imagine it is an accident that they have only three children, for having many more would have placed so much of that at risk.
American fertility rates declined steadily throughout the nineteenth century, but the reasons for the decline shifted over time. In the first half of the century, the decline was Malthusian; it can be traced mostly to later marriages and earlier female deaths. But the downtrend after midcentury looks intentional, for it is especially concentrated in middle-class families. Taking into account child mortality rates, the middle classes barely reproduced at replacement levels, or at about the same rate as in America today.
We now know a surprising amount about how they did it, thanks to a documentation project conducted over thirty years by a remarkable woman named Clelia Duel Mosher, which has been only recently exhumed and analyzed by scholars. Mosher was born in 1863, and like any good Victorian girl took her father’s advice to live at home after secondary school, tending a small greenhouse business. She did so, that is, until she had socked away enough money to go off to college and medical school. She attended Wellesley, Wisconsin, and Stanford, where she received her bachelor’s and master’s degrees in biology, before getting a medical degree from Johns Hopkins. She later spent many years on the faculty of Stanford, with a special interest in women’s health. Of interest here is her detailed survey on reproductive and contraceptive practices among educated women of her own age (born between 1860 and 1870). Her respondents had all finished secondary school, most had some college, and all were married to well-educated men.
The very frank responses to the Mosher surveys show that virtually all these women consciously managed family size by practicing contraception and limiting coital frequency. Compared to college-educated women of the same age in the 1955 Kinsey survey, they had sex only about half as often—about once a week, compared to nearly twice a week for the Kinsey sample, although very few resorted to abstinence. They used a variety of contraceptive practices. In about a third of the cases, contraception was primarily “male-directed”—condoms and/or withdrawal, which were about equally unreliable, given the uncertain quality of the day’s condoms. The rest relied on “female-directed” techniques, primarily douching and fertility timing. (Although doctors did not yet understand ovulation cycles, statistical models suggest that fertility timing combined with the reported coital frequencies should have been about as effective as other available techniques.) A few were experimenting with newer devices, such as cervical caps; the diaphragm was not available until the twentieth century. Mosher did not ask about abortion, but there are suggestions that abortion rates in this group were quite low.
Mosher’s data both confirm long-held expectations and hold several surprises. The data clearly support the conventional assumption that falling fertility among middle-class women was a conscious economic strategy. And given the marital discipline these couples exercised, it is reasonable to assume that the Victorian era’s public restraint in sexual matters evolved to reinforce a policy of “careful love.” But Mosher’s women relied much less on abstinence
and far more on artificial techniques than many historians had assumed—and this long before Margaret Sanger “pioneered” the acceptance of birth control. The apparent low rate of abortion, if the inference is correct, also runs contrary to historians’ expectations. A final interesting data point: once Mosher’s women reached menopause, they had sex about as often as Kinsey’s sample did, and almost as frequently as in their first years of marriage, suggesting again that low coital frequencies in the early years were an adaptive strategy rather than a consequence of generalized prudery.
In such an officially prudish society, the cartoonishly erotic, pinched-waist and bustled dress standard for middle-class women is especially odd; it may have been an infantilizing strategy, a last-ditch resistance to growing female independence. But the control exercised by women within the confines of family life, as consumers, lifestyle managers, and sexual partners was already transmuting into markedly greater public assertiveness, in causes such as suffrage, birth control, and temperance. By the early twentieth century, that energy would spill over into a much broader, often women-led, social reform agenda.
An analyst recently wrote about modern China, “As . . . more and more Chinese people are able to start affording life’s little luxuries, China’s domestic economy is starting to become a powerful engine of growth in its own right.” Nineteenth-century America was the trailblazer for that virtuous cycle of consumer-driven growth, and it presented industrialists and financiers with an entirely new order of demands—to achieve ever-greater scale, but with much greater product varieties and to higher standards of precision. The technical challenge was one that few entrepreneur-managers were up to. To cope, companies had to assemble entirely new sorts of managerial and technical bureaucracies. The age of the consumer, that is, could not get under way except in parallel with the age of the corporation.