The political and economic situation early in the 1870s went from bad to worse, and then from worse to disaster. The “Panic of '73” ushered in a severe depression, one that lasted through most of the decade and depressed prices and wages substantially. Bankruptcies in 1873 and 1874 were horrendous, but the depression persisted, which resulted in bankruptcies in 1877 and 1878 exceeding those of the earlier years. 1 The depression hammered the working class 2 as well as financial investors. The latter lost great sums because of speculation in railroad construction by the banking houses of Jay Cooke and George Opdyke. Gold had been made the sole monetary standard early in 1873, and the monetary practices of the government created enormous financial hardships in several sectors of the economy. Especially hard hit was agriculture, which was being priced out of world markets. Money was in short supply, and gold flowed from the North American continent to Europe almost as quickly as ships could be found to carry it. 3 Yet, despite the economic hard times, daily newspapers were started at the highest rate in history. In 1880, there were 69 percent more newspapers than in 1870. Even the boom years of the 1880s would not surpass this rate of increase. 4
Most of the new dailies were started in small cities in towns close to metropolitan areas or in new industrial cities, and many of them practiced “Western Journalism, ” which later was called New Journalism. Nearly every metropolitan area, with the exception of the Far West and the South, developed such newspapers. The partisan and opinion press, which had dominated and defined American journalism for decades, did not grow as rapidly as those newspapers practicing a New Journalism, but it did grow, sometimes by grafting some of the New Journalism news and business practices onto a thoroughly partisan press. The graft seldom took, unless the partisanship was kept from the news.