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Great Railroad Strike of 1877

Widespread US rail-worker strike

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"Blockade of Engines at Martinsburg, West Virginia," an engraving on front cover of "Harper's Weekly, Journal of Civilization," Vol XXL, No. 1076, New York, Saturday, August 11, 1877. Fighting occurre
Unknown author · Public domain

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Through Trade union, Great Depression and Unemployment

At the time, the workers were not represented by trade unions. Disruption was widespread, and at its height the strikes were supported by about 100,000 workers. Labor continued to work to organize into unions to work for better wages and conditions. Fearing future social disruption, many cities built armories to support local National Guard units; these defensive buildings still stand as symbols of the effort to suppress the labor unrest of this period.

With public attention on workers' wages and conditions, the B&O in 1880 founded an Employee Relief Association to provide death benefits and some health care. In 1884, it established a worker pension plan. Other improvements were implemented later.

Background

Panic of 1873 and the Long Depression

The Long Depression, which began in the United States with the financial Panic of 1873 and lasted 65 months, was the longest economic contraction in American history, including the later more famous, 45-month-long Great Depression of the 1930s. The failure of the Jay Cooke bank in New York was followed quickly by that of Henry Clews, and this set off a chain reaction of bank failures, which temporarily closed the New York stock market.

Unemployment rose dramatically, reaching 14 percent by 1876, with many more severely underemployed, and wages overall dropping to 45% of their previous level. Thousands of American businesses failed, which defaulted on more than a billion dollars of debt. One in four laborers in New York were out of work in the winter of 1873–1874. National construction of rail lines dropped from 7,500 miles of track in 1872 to just 1,600 miles in 1875, and production of iron and steel dropped as much as 45%.

Agricultural communities were also hit hard by the depression, as falling crop prices and rising debt pushed many farmers into financial ruin. The economic downturn led to an increase in foreclosures and farm bankruptcies, particularly in the Midwest and South, where reliance on credit was high. This financial strain fueled political movements such as the rise of the Greenback Party which advocated for the issuance of paper money not backed by gold to stimulate economic growth and ease debt burdens. The Long Depression also contributed to growing labor unrest, as striking workers demanded better wages and working conditions in the face of widespread economic hardship.

Reason for strike

When the Civil War ended, a boom in railroad construction ensued; roughly 35,000 miles (55,000 kilometers) of track was laid from coast to coast between 1866 and 1873. The railroads, the second-largest employer outside of agriculture, required large amounts of capital investment and thus entailed massive financial risk. Speculators fed large amounts of money into the industry, causing abnormal growth and over-expansion. Many banking firms invested a disproportionate share of depositors' funds in the railroads.

In addition to Cooke's direct infusion of capital into the railroads, the firm had become a federal agent for the government's direct financing of railroad construction. As building track in areas where land had not yet been cleared or settled required land grants and loans that only the government could provide, the use of Cooke's firm as a conduit for federal funding worsened the effects that Cooke's bankruptcy had on the nation's economy.

In the wake of the Panic of 1873, a bitter antagonism between workers and the leaders of industry developed. Immigration from Europe was underway, as was migration of rural workers into the cities, increasing competition for jobs and enabling companies to drive down wages and easily lay off workers. By 1877, 10 percent wage cuts, distrust of capitalists and poor working conditions led workers to conduct numerous railroad strikes that prevented the trains from moving, with spiraling effects in other parts of the economy. Workers continued to organize to try to improve their conditions. Employers and liberals feared the spread of communism, particularly through organizations like the Workingmen's Party recently founded in Chicago, and often drew comparisons between such movements and the recent Paris Commune of 1871.

Many of the immigrant workers were Catholics, and their church had forbidden participation in secret societies since 1743, partially as a reaction against the anti-Catholicism of Freemasonry. But by the late 19th century, the Knights of Labor (KOL), a national and predominately European and Catholic organization, had 700,000 members seeking to represent all workers. In 1888, Archbishop James Cardinal Gibbons of Baltimore sympathized with the workers and collaborated with other bishops to lift the prohibition against workers joining the KOL. Other workers also took actions, and unrest marked the following decades. In 1886, Samuel Gompers founded the American Federation of Labor for the skilled craft trades, attracting skilled workers from other groups. Other labor organizing followed.

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