American History

    The Great Railroad Strike of 1877 was one of the worst labor uprisings in the history of the United States. There was wide scale destruction of private and corporate properties. For the first time, the federal government called on the army to quell a labor uprising. The vindictive effect of the uprising spread from Virginia to New York, as far as Florida the Mississippi region. However, like any other historical event, the uprising had indirect and immediate causes.

    In 1873, depression rocked Western Europe. On September 18 of the same year, depression reached the United States with the failure of banking firm Jay Cooke and Company. Cooke was the prime investment banker, backing loans to the Northern Pacific Railroad Company as well as shouldering the governments wartime expenses. The closing of the bank signaled a contraction of the economy. Out of almost 400 railroads, 90 went bankrupt, - about 20 000 businesses closed shop between 1873 and 1876. Unemployment reached critical levels in 1876 (about 14). There was also a 45 cut in minimum wage. The Panic of 1873 forced investors to reinstate capital in same channels of investment. Indeed, the overinvestment of bankers in the railroad industry destroyed the prospect of an early recovery. By 1874, the workers were in constant opposition with the capitalists (the federal government was seen as an agent of capitalist greed).

    In 1877, the federal government implemented a series of wage cuts. The election of Hayes into the presidency (which was controversial) darkened the issue. Hayes wanted a generalized wage cut to allow businesses to recover from the 1873 shock. In the same year, a second wage cut was implemented. The workers rose in open revolt, threatening the Baltimore  Ohio Railroad. When the governor sent state militia units to restore train service, the strike to Maryland and New York, setting the frantic stages of the uprising.