The Supreme Court case that slaughtered the Gilded Age dream
The opulence of the Gilded Age in America is so mesmerizing, it’s no wonder HBO’s series of the same name has been such a hit with viewers. The ornate architecture, lavish fashion, and over-the-top balls of the time easily lend themselves to delightful storytelling. But it is the characters that make this era truly intriguing.
The show highlights the rise of the nouveau riche, a new class of high society not born into money but propelled upward by the opportunities of the Second Industrial Revolution. The air was thick with entrepreneurship and permissionless innovation, which radicalized the American Dream. For the motivated and bold, they needn’t wait for their hard work and sacrifice to yield a better life for future generations—in the Gilded Age, family fortunes were obtained almost overnight.
Oil, steel, railroads, banking, and electricity were just a few of the new, relatively unregulated industries that not only fueled unprecedented upward mobility but also improved the lives of everyday Americans. Yet just as the prosperity of the Gilded Age was gaining momentum, a landmark Supreme Court ruling in the Slaughter-House Cases drove the first nail in the coffin of the era’s greatest promise: freedom to prosper.
The self-made man who lit the world
The real-life self-made entrepreneurs of the Gilded Age were even more impressive than the HBO characters they inspired. And there is perhaps no one that personified the potential of this renaissance of economic self-determination like John D. Rockefeller.
As the son of a traveling “snake oil” salesman and a mother who pinched pennies to keep her family afloat, young Rockefeller never could have imagined that he would one day be the wealthiest man in America. Teachers called him “slow” and “talentless,” but his relentless work ethic told another story. Within a decade of leaving school, enrolling in a business course, and mastering bookkeeping, Rockefeller had revolutionized the oil industry.
His mother’s financial prudence taught him to value efficiency. When he discovered how much byproduct was being thrown out during the oil refining process, he was horrified and searched for solutions. Free from arbitrary regulations, he experimented with discarded materials and discovered uses for them in lubricants, paraffin, and petroleum jelly.
The extra revenue generated from the new products allowed him to cut the price of kerosene by more than 80 percent. He also built his own oil pipelines to reduce reliance on railroads. When he needed to use railroads, he worked to negotiate lower costs through volume discounts.
His obsession with efficiency and innovation pulled him out of poverty. But by improving his own economic circumstances, he bettered the lives of millions of households who now have access to cheap and reliable energy.
While Rockefeller was building Standard Oil in Ohio, another group of entrepreneurs were fighting for their own economic survival in Louisiana and discovering how fragile the right to earn a living could be when government chose favorites.
The butchers of New Orleans
The City of New Orleans sits right on the Mississippi River—the epicenter of American trade in the 1860s. The river’s steady flow of livestock shipments, paired with its proximity to local markets, made its riverbanks the ideal location for dozens of independent butchers. But the river wasn’t just a source of commerce; it supplied the city’s drinking water. Runoff from the slaughterhouses was dumped into the river, filling the water with blood and animal guts—not ideal for sanitation.
As cholera and yellow fever spread throughout the city, state legislators were called upon to address the public health crisis. The legislature’s solution was to create the Crescent City Livestock Landing and Slaughter-House Company—a private company that was granted the exclusive right to establish and operate the city’s new slaughterhouse, which would be built farther downstream.
Louisiana lawmakers had taken it upon themselves to decide who would win and who would fail in the slaughterhouse industry. The losers were the smalltime butchers, many of them immigrants, who were exercising their right to pursue their fortunes and better their lives through legitimate enterprise. The winners were a group of influential businessmen with deep political ties and even deeper pockets who—either through influence or bribes, as some accounts indicate—were now the only game in town.
The butchers were forced to close their businesses. If they wished to continue in the industry, they had to rent stalls in Crescent City’s new slaughterhouse. Essentially, they were coerced into paying for their right to earn a living.
In the end, the Louisiana law financially crippled the independent butchers while doing very little to solve the health crisis. Without proper sanitation or waste treatment, the problem wasn’t resolved, just relocated—and not very far, for that matter.
The butchers weren’t going down without a fight. They recognized this unconstitutional regulatory creep for what it was and sued, arguing that the law violated their Fourteenth Amendment right to economic liberty.
Privileges or Immunities
The Fourteenth Amendment’s Privileges or Immunities Clause says that “No State shall make or enforce any law which shall abridge the privileges or immunities of citizens of the United States.”
According to Representative John Bingham, the primary author of Section 1 of the Fourteenth Amendment, the clause was intended to protect “the liberty … to work in an honest calling and contribute by your toil … to the support of yourself [and] your fellowmen, and to be secure in the enjoyment of the fruits of your toil.” The phrase “privileges or immunities” might be vague on its own, but Rep. Bingham made it quite clear that the clause protected the right to earn a living and secure your own economic prosperity.
This idea of economic liberty did not originate with Bingham. Its forerunner was the Constitution’s Privileges and Immunities Clause in Article IV, constructed to protect the rights of citizens across all states. Like much of the Constitution, this principle is rooted in English common law where it referred to an Englishman’s rights to life, liberty, property, and the ability to pursue lawful callings.
Yet, despite Bingham’s words and the historical context, the lower courts disagreed with this interpretation, and the case eventually made it to the Supreme Court, where the strength of the newly ratified amendment was put to the test.
Tragically, the Court gutted the Privileges or Immunities Clause, insisting it applied only to a narrow set of national rights—like access to federal ports or protection while abroad—while denying that it shielded core individual freedoms such as the right to earn a living. That single decision closed the door on what could have been the Constitution’s strongest safeguard of economic liberty.
Dissenting from the majority, Justice Joseph Bradley called out his colleagues for failing to protect the “right of any citizen to follow whatever lawful employment he chooses to adopt.” Justice Noah Swayne echoed this sentiment, calling the decision “indefensible invasion of the rights of many for the benefit of a few.” Justice Stephen Field added that the decision rendered the Privileges or Immunities Clause “a vain and idle enactment, which accomplished nothing.”
By stripping economic liberty of its constitutional protection, the Court destroyed the key features of the American Dream: the right of every person to freely work, trade, and rise.
Back to Rockefeller
Imagine if, at the start of the oil boom, safety concerns over drilling practices resulted in the Crescent City Oil Refining Company being granted an exclusive charter to refine every drop of oil. Rockefeller never would have had the opportunity to compete by cutting costs, improving efficiency, or finding new uses for byproducts we rely on today. The same ingenuity that lowered kerosene prices and lit millions of American homes could have been strangled before it began.
Thankfully, Rockefeller was not subject to the same state-sanctioned monopolies as the butchers. But within a generation, the government moved to regulate oil through state pipeline monopolies and railroad rate controls—both aimed at Standard Oil. Later, state governments like Texas imposed “prorationing” laws that fixed output and protected established big businesses from competition. Just as in the slaughterhouse industry, politicians claimed they were protecting the public, but in practice they were deciding who could compete—and on what terms.
The Slaughter-House decision was an early warning that the Gilded Age’s momentum—fueled by the liberty of livelihood—would not last. In time, the age of self-made abundance would yield to the Progressive Era, where protectionist policies crept in under the banner of the “public good.”
The ghost of Slaughter-House still haunts hardworking Americans today. Across the country, entrepreneurs are routinely prevented from earning a living because of precedents set during the Gilded Age. Pacific Legal Foundation is fighting to protect every individual’s right to provide for their livelihood. But more than a century later, the Supreme Court is still hesitant, or perhaps downright unwilling, to broach the topic.
The lesson of Slaughter-House remains clear: When government claims the power to decide who may prosper, the American Dream itself hangs in the balance.
