In: Economics
Explain about Baltimore and Ohio railroad strike of 1877. What were some of the most violent confrontations, and what caused them? Discuss why business and government were so opposed to collective bargaining ?
The Baltimore & Ohio Railroad (B&O) is the oldest railroad in the United States of America and it is the first common carrier railroad. The first section was opened in 1830.
In 1877 the Baltimore & Ohio Railroad Strike took place. This was also referred as The Great Railroad Strike or the Great Upheaval. It began on July 14, 1877 in Martinsburg, West Virginia, US after the B&O cut wages for the third time in that particular year. This strike ended after on Sep 4th, 1877.
This strike had a huge significance in the other cities also. Workers in New York, Pennsylvania, Maryland, Illinois & Missouri also went out on strike. It was estimated that around 100 people were killed in this unrest across the country.
So, it all started with the end of the Civil war which led to the boom in the railroad construction. The railroads became the second largest employer after agriculture hence it required huge capital and investment. This led to massive financial risk and Speculators, investment banks, government fed huge amounts of money into railways industry, causing abnormal growth and over-expansion. It was like a bubble being created for this industry which paved way for the ensuing collapse.
Jay Cooke’s firm had very huge amount of investment. They were granting loans to government to finance the railroad. And this led to the bankruptcy of this firm. In the early 1873 there was a panic resulting to the bitter relation between the works and the industry leader. Immigrants from Europe were the rural workers in the cities, which increased the competition hence driving down the wages and easy lay offs. By 1877, 10 % wage cuts and poor working conditions led to workers conducting numerous railroad strikes that prevented the trains from moving. This was solely for the purpose to improve their conditions. Management never listened to them and tried to minimize such strikes by breaking it up.
In the 14th July , 1877 around 100000 people were involved in the strike and around 1000 people were jailed. 100 people lost their lives. Politicians talked about it but nothing came out of it. It was all forgotten after a couple of months.
The business and the government was so opposed to the collective bargain because of the good availability of the workers and the government support for the business. This limited the workers. We have always learnt that bargaining is possible only when the business understands the worth of the workers. But this was not the case in this strike. Since they had large availability of workers (migrants from Europe), they never felt the use to come to a collective bargain.