Most of the tendencies which characterized the growth of population, the expansion of the West, the concentration of the people in cities, the development of manufacturing and agriculture, and the extension of the railway system, from 1870 to 1890, were equally significant during the two decades following the latter year. Nevertheless there were important differences of detail in the tendencies of the later period; and about the year 1900 in particular there occurred changes that were far-reaching.
[Illustration:
The chief foreign elements in the population of the United States, 1910]
The rate of growth of population slowed up slightly after 1890, being twenty-one per cent. per decade, as contrasted with twenty-five per cent. from 1870 to 1890. The increases were distributed over a larger area during the later two decades, and aside from the industrial states, those which showed the greatest growth were Oklahoma, Texas and California. Immigration continued to be large, and concentrated in the north, especially in the cities. In New York city, for instance, forty per cent. of the inhabitants in 1910 were foreign born, and thirty-eight per cent. more were of foreign, or mixed foreign and native parentage. The chief European contributors to the population of America in 1910 in the order of their importance were Germany, Austria-Hungary, Russia, Ireland, Italy and England. Moreover the foreign elements had frequently become concentrated in especial states: the Germans in Wisconsin, Minnesota and Illinois; the Russians in New York, North Dakota and Connecticut; the Austrians in Pennsylvania and New Jersey; and the Irish in Massachusetts, Connecticut and New York. The immigration of Canadians, which had been of importance before 1900, appreciably slowed down after that year; and instead there was a distinct movement in the opposite direction, especially from Minnesota, North Dakota and Washington. The emigration was caused mainly by the desire to take up fertile lands which had been widely advertised by the Canadian government. The migration from the eastern states toward the West continued as in earlier years. It was noticeable, however, that whereas previous migration had been almost wholly on east and west lines, there was in later years a greater tendency to seek favorable openings wherever they were found. Oklahoma, for example, in 1910 contained 71,000 natives of Illinois, 101,000 Kansans and 162,000 Missourians. The trend of population toward the cities was so rapid between 1890 and 1910 as to suggest the likelihood that by 1920 half the people of the country would be living in communities of 2,500 persons or more. Of the twenty-three towns that more than doubled in numbers during the two decades after 1890, seventeen were in the South and on the Pacific Coast, indicating that the tendency toward urban life was no longer confined to the North and East.
Manufacturing increased its importance as the greatest economic activity in the Northeast, and was moving westward so rapidly that Ohio, Michigan, Indiana and Illinois found their interests becoming increasingly like those of the eastern states. Parts of the South, also, developed considerable industrial interests. The manufacture of cotton goods, for example, increased with such rapidity that three of the first five states in the value of their product in 1909 were southern states—North Carolina, South Carolina and Georgia. Since 1889 the production of lumber has taken a prominent place. Louisiana doubled its activity from 1889 to 1899 and had tripled this record by 1909. Almost the entire South from Virginia to Louisiana produced large amounts during the twenty years under consideration. The iron and steel industry in Alabama, and the production of turpentine, resin and fertilizers were other important southern interests. Throughout the country at large the number of wage earners engaged in manufacturing grew somewhat more rapidly than the population, being about twenty-five per cent. per decade from 1890 to 1910.
The center of agriculture continued to be in the Middle West, in which was to be found nearly fifty-three per cent. of the improved farm lands and fifty-eight per cent. of the value of all farm property. It was in this part of the country that the greatest increases in the amount of improved land took place, and particularly in the prairie country west of the Mississippi. By 1890 the Plains had lost their earlier unique and picturesque characteristics as a cattle country, and had given way to the homesteader. Hence the greatest expansion in agriculture took place in the tier of states from North Dakota to Texas. It appeared, therefore, that manufacturing was driving agriculture farther and farther to the west: New England cultivated less farm land in 1910 than in 1850; the improved area in New York, New Jersey and Pennsylvania declined after 1880; Ohio tilled fewer acres in 1910 than in 1900, and the gradual replacement of agriculture by manufacturing was observable in Indiana and Illinois. Oklahoma and Texas, on the other hand, together opened to cultivation between 1890 and 1910 nearly 24,000,000 acres, an expanse almost equivalent to the combined areas of New Hampshire, Vermont, Massachusetts and Maryland.
By 1890 it was clear that the future of the Far West lay in agriculture, rather than in the mining of the precious metals. Between that date and 1910, the amount of improved farm land in the section increased sixty-five per cent. In the states of Washington, New Mexico, Colorado, Idaho and Montana, large areas were placed under cultivation. In Washington the amount of improved farm land increased about 350 per cent. The growing of fruits and nuts was brought to a high state of excellence in the coast states. The timber industry developed after 1880 and particularly after 1900. About the close of the nineteenth century the great lumber companies began to seek sources of supply to take the place of those around the Great Lakes. They turned to the South and the Far West. The methods which were used for getting control of the land, and the recklessness with which the supplies of timber were cut off became of importance as causes of the conservation movement. The main handicap in the way of the development of trade between the Far West and the East was the great distances involved. Hence arose the interest of the Coast in transcontinental railway rates and the project for a canal across the isthmus of Panama.
An economic fact of no little importance was a change in the downward tendency of the price level after 1896. It will be remembered that the constant fall in prices from 1873 to 1896 had brought distress to the farmers of the West and had been one of the causes of the Populist revolt. After 1896 the process was reversed. Between that year and 1913 the quantity of gold in circulation considerably increased, as has been seen; bank deposits subject to check trebled in volume, and the use of checks became more common; altogether it was estimated by Professor Irving Fisher that the quantity of money in circulation increased two-fold. Prices were fifty per cent. higher in 1913 than in the earlier year, and accordingly the complaints of the farmer were less frequently heard. The wage earner in the factories, however, was differently affected. The price which he had to pay for the necessities of life increased faster than his wages, so that his standard of living was going down. Inasmuch as the number of wage earners in the factories was rapidly increasing, it seemed inevitable that the problem of rising prices after 1896 would constitute as great a problem as the problem of falling prices had done before that year.
[Illustration:
The Cost of Food, 1900-1912]
In industrial enterprise the close of the nineteenth century and the opening of the twentieth were characterized by a mad rush toward consolidation. To a milder degree the process had, of course, been under way for many years, during which the Standard Oil Company and other trusts were the subject of much study and legislation. In the course of time some of these concerns made such great profits that their leaders sought attractive openings for the investment of their surplus. They began to appear on the boards of directors of railways, banks, electric lighting companies and other industrial organizations. Before 1900 two powerful groups had definitely formed. The Standard or Rockefeller group was obtaining large interests in such railroads as the Missouri, Kansas and Texas, the Delaware, Lackawanna and Western, and the Chicago, Milwaukee and St. Paul. It was reaching out to the gas and electric companies in New York, had an alliance with the National City Bank and others, and was in touch with great life insurance companies such as the Equitable and the Mutual of New York. Such connections enabled them to determine the policies and direct the investments of these important concerns. The Morgans extended their influence over the Philadelphia and Reading, the New York, Lake Erie and Western, the Lehigh Valley and others. Morgan himself also entered the industrial field as organizer of the Federal Steel Company and the National Tube Company.
The mania for organizing large corporations came to a climax about 1900. The census taken in that year noted ninety-two that had been formed between January 1, 1899, and June 30, 1900. Early in 1904 the editor of Moody's Manual of Corporation Securities noted the existence of 440 large industrial and transportation combinations whose capitalization as measured by the par value of their stocks and bonds was nearly $20,500,000,000. The securities—stocks and bonds—of the new companies were eagerly taken up by the investing public. Prosperity was wide-spread and the financial strength behind the organizations seemed unlimited. Speculation became common. A few individuals amassed wealth through the shrewd purchase and sale of stocks, and countless others sought unsuccessfully to imitate them. Where sales of 400,000 shares on the stock exchange had formerly been looked upon as a good day's business, the record jumped to a million, then two, and even three.[1]