PeriodVI:1865-1898Part3:IndustrialSupremacy

EconomicTransformation•  Newtechnologies•  Newformsofcorporateorganiza4on•  Waveofimmigra4on–cheapandabundantlaborforce•  VastnaturalresourcesoftheUS

NewTechnologies•  Newsteelproduc4ontechniques•  Bessemerprocess•  westernPAandeasternOH

•  Newtransporta4on•  Steamfreighters,railroads

•  PetroleumIndustry

NewTechnologies•  Automobile•  PerfectedbyHenryFord–appliedassemblylinetechniqueandinterchangeableparts

•  Airplane•  WilburandOrvilleWright

NewTechnologies•  CorporateResearchandDevelopment•  Transforma4onofhighereduca4on–receivedfundingfromcorpora4ons

•  Changesinproduc4ontechniques•  “Taylorism”–ledtomovingassemblyline

NewTechnologies•  Railroadexpansion•  Principalformoftransporta4on•  Gaveaccesstorawmaterialsandmarkets•  Ledtogrowthofotherindustries•  Developmentof“standard4me”and4mezones

•  CorneliusVanderbilt

Corporations•  Emergenceof“modern”corpora4ons•  Financethroughsaleofstock–“limitedliability”•  Onlyriskamountofinvestment

•  Steel–AndrewCarnegie,HenryClayFrick•  Ver4calIntegra4on•  CarnegiesoldintereststoJ.P.MorganformingU.S.Steel

Corporations•  HorizontalIntegra4on•  Combinefirmsinvolvedinsameenterpriseintoonecorpora4on

•  Ver4calIntegra4on•  Takingoverdifferentbusinessesonwhichacompanyreliedforitsprimaryfunc4on

•  UsedbyJohnD.Rockefeller–StandardOilCo.

TrustandHoldingCompany•  “Trust”•  Stockholdersandindividualcorpora4onstransferstockstoasmallgroupoftrusteesinexchangeforsharesinthetrustitself

•  “Holding”Company•  Centralcorporatebodythatwouldbuyupstockoftrustandestablishdirectownershipofcorpora4onsinthetrust

•  CONSOLIDATIONisthetheme•  1%ofcorpora4onscontrol33%ofmanufacturingbyendofnineteenthcentury

CapitalismandControversy•  Mythofthe“self-mademan”–manytycoonsbegancareersfromposi4onsofwealthandprivilege

•  Ruthlesscorrup4onprevalent•  Poortreatmentofworkers,briberyofpoli4cians,blackmail

SocialDarwinism•  “SurvivaloftheFi\est”•  Richesseenasarewardforworthiness–hardwork,thri],skill

•  Jus4fica4onforstatusquo•  Jus4fiedelimina4onofcompe44on

•  TheGospelofWealth:AndrewCarnegie•  Believedwealthyhadobliga4ontosocialprogress–philanthropy

•  Waswealthavailableforeveryone?•  RussellConwell,Hora4oAlger:“ragstoriches”stories

ProblemsofMonopoly•  Controlofmarketbylargecorporatecombina4ons•  nocompe44on•  Blamedforar4ficiallyhighprices•  Unstableeconomy•  Threatenedabilityofindividualstoadvance•  Baronslivelivesofluxurywhileothersstruggle

ImmigrantWorkForce•  Mexico,Asia,Canada,mostlyEurope•  25millionbetween1865and1915

•  Shi]fromnorthernandwesternEuropetosouthernandeasternEuropearound1871•  Italy,Poland,Russia,Greece,Slaviccountries

•  Heightenedethnictensions

WagesandWorkingConditions•  $400-$500ayear-$600requiredforminimallevelofcomfort•  Li\lejobsecurity•  Repe44vetasks–monotonousschedule•  10hoursaday,6daysaweek•  Unsafe,unhealthycondi4ons•  Nocontroloverlabor

WomenandChildren•  Couldbehiredatlowerwages•  Twoincomeso]enbecamearequirementforfamilies

•  Needforaddi4onalwagesledtohiringofchildren•  Earlychildlaborlawswereineffec4ve

TheStruggletoUnionize•  Triedtousetechniquesofconsolida4on•  Na4onalLaborUnion

•  “MollyMaguires”–militantlabororganiza4on•  Li\lesuccessinlate1800s

GreatRailroadStrikeof1877•  Responseto10%wagecut•  Strikersdisruptedrailservice,destroyedequipment,rioted•  PresidentHayesusedfederaltroopstosuppress•  Firstmajor,na4onallaborconflict

TheKnightsofLabor•  Firstmajorefforttocreateagenuinelyna4onallaborunion•  Membershipopentovirtuallyallworkers•  Metwith“localassemblies”looselyaffiliatedwithna4onal“generalassembly”

•  Disappearedaroundtheturnofthecentury

TheAFL–AmericanFederationofLabor•  LedbySamuelGompers•  Representedmainlyskilledlaborers•  Opposedtofemaleemployment–s4llsoughtequalpay•  Wantedagreatershareofcapitalism’srewardsforworkers

HaymarketSquare-Chicago•  Partofgeneralstrike–strikehadalreadybegan•  Policeorderedcrowdtodisperse–bombthrownintopoliceforma4on•  Policefiredintocrowd–killedfour

TheHomesteadStrike-1892•  AmalgamatedAssocia4onofIronandSteelWorkers•  Deniedrighttonego4atebyCarnegieandFrick

•  Constantwagecuts•  Amalgamatedcalledforstrike•  FrickshutdownHomesteadplantandbroughtin300PinkertonDetec4vestoprotect“scabs”•  Ledtooutbreakofviolence

ThePullmanStrike-1894• PullmanPalaceCarCompany•  Slashedwages,highrentin“companytown”•  StrikesupportedbyAmericanRailwayUnion–EugeneDebs•  2,000troopssenttoquellstrikers

Labor’sWeaknesses•  Fewvictoriesforlabor•  Onlyasmallpor4onofworkersrepresentedbyunions•  Shi]ingnatureofworkforce–workermobility•  Corpora4onsweretoostrong