Last updated: December 18, 2010 2:18 pm

American Colossus

American Colossus: The Triumph of Capitalism 1865-1900, by HW Brands, Doubleday RRP$35, 624 pages

Lee Chew, the son of a Chinese peasant farmer, was content to remain on his Canton farm in the 1860s until “a man of our tribe” came home in triumph from the United States of America, where he had made a fortune.

 
John D Rockefeller

John D Rockefeller as an industrial emperor in a 1901 cartoon from Puck magazine

“He put a large stone wall around and led some streams through and built a palace and a summer house and about 20 other structures, with beautiful bridges over the streams and walks and roads. Trees and flowers, singing birds, water fowl and curious animals were within the walls ... The wealth of this man filled my mind with the idea that I, too, would like to go to the country of the wizards and gain some of their wealth.”

Capitalism and surging industrialisation had brought untold wealth to these wizards – the Morgans, the Rockefellers, the Vanderbilts. In 1883 George Vanderbilt held a gala at his new mansion at Fifth Avenue at 52nd Street that dazzled New York society and set off “an orgy of conspicuous consumption”. Vanderbilt’s sister-in-law wore a white satin gown trimmed with diamonds and a diamond head-dress, calling herself “The Electric Light”.

In the current era of US self-doubt, beset by intimations of political and economic decline, the era of American hegemony seems awfully distant – although as recently as the 1990s globalisation seemed to be remaking the world in the US mould. So it is poignant as well as breathtaking to read this lively and panoramic account of the rise of US capitalism and the transformation of a continent.

More

On this story

John Gapper

The life stories of the first JP Morgan, John D Rockefeller and Cornelius Vanderbilt have been written by authors such as Ron Chernow. But HW Brands weaves them into a broader account of the astonishing social changes that rippled through the nation in these decades – shaking up the lives of everyone from the southern slaves to Lower East Side immigrants.

It is possible now to witness a society in the middle of a capitalist revolution, with dazzling contrasts of wealth and poverty and a transformation of cities and transport so rapid that it appears to be happening in front of your eyes. Just take a bullet train from Nanjing to Shanghai and then stand on the Bund to see the skyscrapers of the Pudong financial district lit up like a scene from Bladerunner.

It probably felt like that to ride the Union Pacific Railroad; or to go to Chicago after the fire of 1871 cleared the way for the first skyscrapers; or to see the harvest on the bonanza farms of the Minnesota Red River; or cross the Brooklyn Bridge for the first time. “Babylon had her hanging gardens, Egypt her pyramids, Athens her Acropolis, Rome her Coliseum, so Brooklyn has her bridge,” read a banner at the opening.

 

This is a long and dense book, packed with anecdotes and statistics ranging across all facets of politics and society. Yet it draws its greatest power from the accounts of those who saw the changes, from Jacob Riis, the “muckraker” of the immigrant slums, to Black Elk, the son of an Oglala Sioux medicine man and second cousin to Crazy Horse, who witnessed the Battle of Wounded Knee.

“It was a good winter day when all this happened,” he recalled. “The sun was shining. But after the soldiers marched away from their dirty work, a heavy snow began to fall. The wind came up in the night. There was a big blizzard and it grew very cold. The snow drifted deep in the crooked gulch, and it was one long grave of butchered women and children and babies, who had never done any harm and were only trying to run away.”

Brands, a professor of history at the University of Texas who has written Pulitzer Prize-shortlisted biographies of Benjamin Franklin and Franklin Delano Roosevelt, does not shy away from such suffering. He chronicles the tensions between capitalism and democracy created by extreme divergences of fortune and the lobbying power of big business – tensions that are no less strong today.

It was a financial earthquake and it claimed victims such as Chinese young women shipped to San Francisco for prostitution by the tongs as well as giving moguls their Gilded Age. Most of the Chinese “coolies” who emigrated to the US worked as railroad labourers rather than gaining the fortunes to which Lee Chew aspired. Their attempts to strike for higher wages were violently suppressed.

Yet Brands concludes that “the capitalist revolution was in many ways the best thing ever to befall the ordinary people of America”. The population grew from 40m in 1876 to 76m in 1900, one-third of the rise coming from immigration. Infant mortality fell by one-third and life expectancy grew by one-seventh. Output tripled and average per capita income doubled as the proportion of the workforce on farms halved.

Above all, it provided the opportunity for entrepreneurs to get rich very quick. He recounts how John D Rockefeller, who had paid $300 to get himself out of the draft for the Union Army, was inspired by the Pennsylvania oil rush of 1859, although “black gold” was initially used mainly as a substitute for whale oil in lamps.

Rockefeller sensed greater potential and Henry Ford later proved him right. (In his philanthropic years, Rockefeller piously told Ford he would see him in heaven, and Ford muttered: “You will if you get in.”) It was better to take risks as an entrepreneur than to take a salary, as Andrew Carnegie observed: “A man must necessarily occupy a narrow field who is at the beck and call of others.”

In contrast, this was the life of JP Morgan. “Not long after closing the [US Steel trust] deal with Carnegie and Rockefeller, Morgan sailed for France on his annual vacation and art-hunting expedition. He bagged a Raphael altarpiece, the “Colonna Madonna”, and some smaller game in Paris before retiring to Aix-les-Bains. There, in early May, he received a cable from New York explaining that unknown raiders had mounted an assault on the Northern Pacific Railroad.” Who wouldn’t have wanted to be an American capitalist?

John Gapper is the FT’s chief business commentator

Copyright The Financial Times Limited 2014. You may share using our article tools.
Please don't cut articles from FT.com and redistribute by email or post to the web.