The Telegraph in America, 1832-1920
by David Hochfelder

Reviewed by Dan Wuebben

¨(Name)! Have a great day!¨ ¨Happy Birthday (insert nickname)!¨ (NAME)!!! Muchas Felicidades!!!!! ¨ Or, in Morse code, “HB2U”: .... -... ..--- ..-

Countering our revulsion with Facebook´s mercurial privacy-settings is our fascination with the social economics of its Birthday feature. The give and get of Facebook birthdays is unquestionably a feature of real simplicity and power. Yet, if history repeats, increasing efforts on behalf of Facebook to make birthdays ever more special may be symptomatic of the decline of the social network’s cultural cache and stock value.

During the great depression, with the telegraph industry in a tailspin, Western Union began offering users similarly cheap, prefabricated birthday greetings and other holiday messages such as ¨ I´m just a little tot, I haven´t much to say, just want to wish you a happy Mother´s Day¨ (cost .25 cents). The ¨Fixed Text¨ campaign was designed to ¨embrace sociability¨ and to help alter the public perception that telegrams were restricted to business correspondence, stock trades, and sensational news. In short, these bland, canned birthday messages were a ploy to introduce the medium to a broader audience and give everyone something to say (and pay for).

Americans sending long-distance artificial greetings is one thread in the band of distinct, though often tangled, lines of similarity that run between current Internet practices and the approximately century-long rise and fall of telegraphy. Hochfelder’s Telegraph in America, 1832-1920 does not mention Facebook, but it does begin to parse that cluster of lines, methodically charting the telegraph’s technological development—from single-circuit, sender-to-receiver transmissions, to the self-relaying quadraplex systems able to transmit numerous messages simultaneously over single wires—and the corresponding social changes that, Hochfelder’s writes, ¨proved as significant to human experience as the invention of writing in the ancient world and the printing press revolution of early modern Europe.¨

During the second half of the nineteenth century, wiring information quickly from A to B concatenated the U.S. Government, the military, commerce, media outlets, and financial markets. However, the revolutionary, widespread social effects that accompanied these new electric connections were emphatically not neat nor instantaneous. Samuel F.B. Morse spent nearly a decade trying to convince politicians and investors of the usefulness of his invention and, despite the initial excitement generated by his inauguration of the telegraph in 1844 with the message—“What Hath God Wrought?”—the communication technology was viewed as little more than a parlor trick. Early customers often indulged in the new technology to no greater depth than paying to send the message “hello.” A handful of investors could see the technology’s potential, but the telegraph did not begin to forcibly change the playing field until the Civil War (1861-1865), when rudimentary telegraph keys and boxes of wire were carried onto the battlefield. As the 1862 Battle of Antietam unfolded, commanders coordinated attacks and redirected troops using telegraph messages. Meanwhile, crowds gathered regularly at telegraph offices to get the latest updates. The scripts of on-the-scene reports became a sought-after source of print journalism. On July 22, 1861 The New York Times published ¨a running account of the previous day’s battle at Bull Run, reproducing some thirteen telegraphic bulletins sent between 11.00am and 5.45pm.¨ Shortly after George McClellan was appointed general-in-chief, he ordered field generals to build telegraph lines to connect their headquarters to his offices in Washington D.C. Secretary of War Edwin Stanton then ordered the lines to be rerouted from McClellan’s headquarters to the War Department offices. From the War Department, Stanton thereafter controlled army communications and “oversaw the censoring of telegraphic news dispatches.” Meanwhile, Secretary of State William Seward reportedly vowed to “talk the telegraph in my own hands” and “straighten out …the press.” The war thus forced generals and politicians to develop a new technological literacy. From that point forward, electric lines proved crucial mediators between generals, politicians, the press, and the public.After showing the telegraph’s multifaceted influence on the Civil War, Hochfelder’s history disembarks from its sequential narrative and follows four prominent and, sometimes overlapping forces that underlay telegraphy’s “heydey” between 1860 to 1920: 1) debates about consolidation vs. regulation and private vs. public ownership 2) altered meanings and uses of written language and journalism 3) electronic trading and growth of modern finance capitalism 4) the rise of AT&T and the telephone’s succession of the telegraph.

Western Union is the connecting thread between these various forces. In 1866, Western Union’s buyout of American Telegraph gave them control of almost 80% of all telegraph traffic. Their dominance produced calls for increased regulation and plans to wrestle private control of all wires from the private sector and hand them over to the U.S. post office “ebbed and flowed with the absence and presence of meaningful competition with Western Union.” Western Union discouraged such competition by making deals for exclusive rights with railroad companies, financial markets, and press associations. The telegraph increased the circulation of ideas; the telegraph owners subsequently used price gouging and censorship to control them. For example, in 1867, Western Union forced the New York Associated Press to cut ties with the Omaha Republican because it ran an editorial calling the company a “grievous,” “onerous,” and “gigantic” “monopoly.” By 1881, Hochfelder reveals, “Western Union and press associations had come to work so closely together that they controlled the flow of the nation’s news.” As Hochfelder notes, between 1866 and 1900 congress “considered nearly one hundreds bills and issues forth-eight committee reports on postal telegraphy, making it one of the most heavily studied and debated issues of the day, and yet efforts to curb such practices through widespread reform failed.” In one of his rarer moments of subjective speculation, Hochfelder says the failure to impose stricter regulations and put the network under federal control “might well be the origin of today’s cheapened political debate and impoverishment of the public sphere.”

While offering new insights into the relationship between Western Union and the Associated Press, Hochfelder’s strongest contribution to the history of telegraphy is his analysis of the impact of wiring on financial markets and the subsequent spread of speculation and gambling fueled by private wires and telegraph ticker services. With the advent of continuous trading and ticker service in the 1870s, the nature of markets changed fundamentally: “Instead of markets that relied on information, they increasingly became markets in information.” Brokers no longer bought and sold products, they wagered on the rise or fall of a price that emerged from a telegraph ticker. Of course, those with more direct access to quotations secured an advantage of hours, and then minutes, and then seconds, that helped them to manipulate trading (an advantage that has continued up through the present day high-frequency trading). The frenzy was most intense in the “bucket shops” which first appeared in New York in 1877. In these gambling parlors, ordinary Americans could wager as little as $5 on the movement of a stock price. These shadow markets effectively blurred the line between legitimate trading and outright gambling. In most cases, Western Union was on the winning end: in fact, Hochfelder writes that “a majority” of their ticker business “came from gambling in bucket shops, horse-race gambling parlors, and saloons.” Bucket shops would be outlawed in most states by the turn of the century, just as the far-reaching and seemingly omnipotent network facilitated by Western Union was beginning to fade. In 1879, Western Union and AT&T reached an agreement that began the technology’s decline into obsolescence. It goes without saying that this was in fact no extinction at all, but rather an evolution. In The Telegraph in America, 1832-1920, one glimpses much that is prescient of this late age: of Twitter, high-frequency trading algorithms, of the moment a seemingly omniscient company begins marketing the exchange of watered down social capital in an attempt to stem the decline of its earning potential.