Challenge of the Gilded Age: The Myth of Laissez-Faire Economics in American History, Part II

Within the framework of laissez-faire ideology it would be necessary to wonder what the role of the federal government should be in cases such as the 1877 Railroad Strikes. Because of the growing unrest throughout the industry and the mass waves of chaos that seemed to be ensuing (whether caused by the strikers or the militias), it is reasonable to expect the government to step in and calm the storm. But what then of the federal role? This was not a time of war, so intervention on behalf of industry could not be as easily justified as during the Civil War. This was also not a case of violence instigated by the workers themselves; indeed, many militias were sent in under orders to shoot to kill, regardless of whether the strikers had committed acts of violence on their own. In this situation, perhaps a true proponent of liassez-fair economics would insist that the federal government restore order and then stand by in neutrality while the two sides worked toward a non-violent, constructive agreement.

But this is not what happened. What did happen would set a very powerful precedent for the remainder of the nineteenth century and into the twentieth. President Hayes received numerous requests to send in federal troops to end the strikes, and every time he complied. He got some help from bankers like J.P. Morgan and August Belmont who provided the government with loans to be able to pay for the calling out of troops. General Winfield Scott Hancock led 3,000 troops into various cities, under the direction of the war department, to remove strikers and allow the trains to continue to move. President Hayes remarked emphatically in his diary: "The strikers haven been put down by force (emphasis added)."³

And the results of government intervention? The safe importation of strikebreakers was assured by the presence of federal troops, rendering the strikers' efforts useless. Strikers were forced to return to work, their leaders arrested and blacklisted. The conditions and pay over which the strikes were organized remained relatively unchanged. Courts continued to declare trade unions and other such organizations as conspiracies to disrupt trade. Conspiracy laws would be passed in state legislatures, national guard armories and federal arsenals would be expanded and improved. Striking and picketing would continue to prove more and more difficult as local, state, and federal governments worked with the railroad industry to help ensure that such strikes

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