The American Pageant Chapter 24 Industry Comes of Age Cover Slide Copyright © Houghton Mifflin Company. All rights reserved. Adapted from: Ms. Susan M

Essential Question Industrialization increased the standard of living and the opportunities of most Americans, but at what cost?

The Iron Colt Becomes an Iron Horse After Civil War: railroad production grew enormously 35,000 mi. of track laid in 1865 to a whopping 192,556 mi. of track laid in 1900. Congress gave land to railroad companies 155,504,994 acres. Railroads = value towns where railroads ran became sprawling cities those skipped by railroads = ghost towns, towns wanted railroads in them.

Spanning the Continent with Rails transcontinental railroad: Able to be built in North after the South seceded, and in 1862: Congress commissioned the Union Pacific Railroad to begin westward from Omaha, Nebraska, to gold-rich California. received huge sums of money & land to build its tracks corruption also plagued it (insiders of the Credit Mobilier reaped $23 million in profits) Irishmen, who might lay as much as 10 miles a day built the railroad

Some Indians attacked while trying to save their land Irish would fight them, many Indians died during construction. California, the Central Pacific Railroad extended the railroad eastward, backed by the Big Four including : Leland Stanford, the ex-governor of California who had useful political connections, Collis P. Huntington, an adept lobbyist. Central Pacific used Chinese workers received same incentives as the Union Pacific had to drill through the hard rock of the Sierra Nevada. Spanning the Continent with Rails

1869: transcontinental rail line was completed at Promontory Point near Ogden, Utah the Union Pacific built 1,086 mi. of track 689 mi. by the Central Pacific. Spanning the Continent with Rails

Binding the Country with Railroad Ties Before 1900, 4 other transcontinental railroads were built: The Northern Pacific Railroad stretched from Lake Superior to the Puget Sound (1883) The Atchison, Topeka, and Santa Fe stretched through the Southwest deserts (1884) The Southern Pacific (completed in 1884) went from New Orleans to San Francisco. The Great Northern ran from Duluth to Seattle and was the creation of James J. Hill, probably the greatest railroad builder of all.

Many pioneers over-invested on land, the banks that supported railroads often failed & went bankrupt when the land wasnt worth as much as initially thought. Binding the Country with Railroad Ties

Railroad Consolidation and Mechanization Older eastern railroads, like the New York Central, headed by Cornelius Vanderbilt, often financed the successful western railroads. Advancements in railroads included: the steel rail=stronger & more enduring than the iron rail the Westinghouse air brake which increased safety, Pullman Palace Cars which were luxurious passenger cars telegraphs, double-racking, and block signals. Nevertheless, train accidents = common as well as death.

Revolution by Railways Railroads stitched the nation together, generated a huge market lots of jobs helped the rapid industrialization of America stimulated mining and agriculture in the West brought people & supplies to &from the areas where such work occurred.

Railroads helped people settle in the previously harsh Great Plains. Due to railroads, the creation of four national time zones occurred on November 18, 1883, instead of each city having its own time zone (that was confusing to railroad operators). Railroads were also the makers of millionaires and the millionaire class. Revolution by Railways

Wrongdoing in Railroading Corruption existed in Railroad Business Credit Mobilier scandal. Jay Gould: made millions embezzling stocks from the Erie, Kansas Pacific, the Union Pacific, and the Texas and Pacific railroad companies. stock watering: cheap moneymaking in which railroad companies grossly over-inflated the worth of their stock and sold them at huge profits.

Railroad owners: abused the public bribed judges and legislatures, employed arm-twisting lobbyists elected their own to political office, gave rebates which helped the wealthy but not the poor used free passes to gain favor in the press. Wrongdoing in Railroading

railroad giants began the first of what would be called trusts at that time they were called pools. pool (AKA, a cartel) = group of supposed competitors who agree to work together, usually to set prices. Wrongdoing in Railroading

Government Bridles the Iron Horse Background: People were aware of such injustice, but were slow to combat it. Grange was formed by farmers to combat such corruption Some states stop the railroad monopoly They were stopped by the Supreme Court with the Wabash case ruled that states could not regulate interstate commerce, such as trains.

Interstate Commerce Act (1887) banned rebates & pools required the railroads to publish their rates openly (so as not to cheat customers), forbade unfair discrimination against shippers banned charging more for a short haul than for a long one. set up the Interstate Commerce Commission (ICC) to enforce this. Government Bridles the Iron Horse

Interstate Commerce Act (1887) cont.. not a victory against corporate wealth, Richard Olney a shrewd corporate lawyer, noted that they could use the act to their advantage, Did = 1 st attempt by Congress to regulate businesses for societys interest. Government Bridles the Iron Horse

Miracles of Mechanization 1860, the U.S. = 4th largest manufacturer in the world by 1894, it was #1, why? Now-abundant liquid capital. Fully exploited natural resources (like coal, oil, and iron, the iron came from the Minnesota-Lake Superior region which yielded the rich iron deposits of the Mesabi Range).

Massive immigration made labor cheap. American ingenuity played a vital role, as such inventions like: mass production (from Eli Whitney) were being refined and perfected. Popular inventions included: the cash register the stock ticker, the typewriter the refrigerator car the electric dynamo The electric railway, which displaced animal-drawn cars. Miracles of Mechanization

Thomas Alva Edison Wizard of Menlo Park

The Light Bulb

The Phonograph (1877)

The Ediphone or Dictaphone

The Motion Picture Camera

Alexander Graham Bell Telephone (1876)

The Trust Titan Emerges Industry giants used various ways to eliminate competition and maximize profits: Andrew Carnegie used a method called vertical integration: meant that he bought out & controlled all aspects of an industry Ex:,he mined the iron, transported it, refined it, and turned it into steel, controlling all parts of the process

The Trust Titan Emerges John D. Rockefeller = master of horizontal integration simply allied with or bought out competitors to monopolize a given market used this method to form Standard Oil & control the oil industry by forcing weaker competitors to go bankrupt.

New Type of Business Entities

Standard Oil Co.

J.P. Morgan (banker) placed his own men on the boards of directors of other rival competitors why? gain influence there reduce competition, a process called interlocking directorates. The Trust Titan Emerges

New Financial Businessman The Broker: J. Pierpont Morgan The Broker: J. Pierpont Morgan

The Supremacy of Steel During Civil War: steel = very scarce & expensive by 1900, Americans produced as much steel as England & Germany combined. Due to an invention that made steel- making cheaper & much more effective: the Bessemer process named after an English inventor even though an American, William Kelly, had discovered it first

Bessemer Process: Cold air blown on red-hot iron burned carbon deposits and purified it. America was one of the few nations that had a lot of coal for fuel, iron for smelting, & other essential ingredients for steel making quickly became #1. The Supremacy of Steel

Iron & Steel Production

Carnegie & Other Sultans of Steel Andrew Carnegie: started off as a poor boy in a bad job by working hard, assuming responsibility, & charming influential people, he worked his way up to wealth. started in the Pittsburgh area Didnt like trusts by 1900, he was producing 1/4 of the nations Bessemer steel, & getting $25 million a year.

J. Pierpont Morgan: already made a fortune in the banking industry & in Wall Street ready to step into the steel tubing industry Carnegie threatened to ruin him after some tense negotiation, Morgan bought Carnegies entire business at $400 million (this was before income tax) Carnegie, fearing ridicule for possessing so much money, spent the rest of his life donating $350 million of it to charity, pensions, & libraries. Carnegie & Other Sultans of Steel

Meanwhile, Morgan took Carnegies holdings added others launched the United States Steel Corporation (1901) the worlds first billion-dollar corporation (it was capitalized at $1.4 billion). Carnegie & Other Sultans of Steel

Rockefeller Grows an American Beauty Rose by the 1870s: kerosene, a type of oil = used to light lamps all over the nation. By 1885, 250,000 of Edisons electric light bulbs were in use electric industry soon made kerosene obsolete just as kerosene had made whale oil obsolete.

Rockefeller Grows an American Beauty Rose Oil demand was increasing gasoline-burning internal combustion engine. John D. Rockefeller = ruthless & merciless organized the Standard Oil Company of Ohio in 1882 (five years earlier, he had already controlled 95% of all the oil refineries in the country). crushed weaker competitors part of the natural process according to him did produce superior oil at a cheaper price.

Other trusts, which also generally made better products at cheaper prices, emerged, such as the meat industry of Gustavus F. Swift and Philip Armour. Rockefeller Grows an American Beauty Rose

The Gospel of Wealth Gospel of Wealth. : Many of the newly rich had worked from poverty to wealth, so? felt that some people in the world were destined to become rich & then help society with their money Social Darwinism applied Darwins survival-of-the-fittest theories to business said the reason a Carnegie was at the top of the steel industry was that he was most fit to run such a business.

Reverend Russell Conwell of Philadelphia became rich by delivering his lecture, Acres of Diamonds 1000s of Xs preached that poor people made themselves poor rich people made themselves rich everything was because of ones actions only Corporate lawyers used the 14th Amendment to defend trusts judges agreed, saying that corporations were legal people and thus entitled to their property, & plutocracy ruled. The Gospel of Wealth

Government Tackles the Trust Evil Sherman Anti-Trust Act (1890) it forbade combinations (trusts, pools, interlocking directorates, holding companies) in restraint of trade, without any distinction between good and bad trusts. Ineffective--couldnt be enforced. Wasnt enforced until 1914 when those prosecuted for violating the law were actually punished

The South in the Age of Industry South remained agrarian (despite all the industrial advance) James Buchanan Duke developed a huge cigarette industry = American Tobacco Company made many donations to what is now Duke University. Henry W. Grady, editor of the Atlanta Constitution newspaper urged the South to industrialize.

***Many northern companies set rates to keep the South from gaining any competitive edge Ex: including the rich deposits of iron and coal near Birmingham, Alabama & the textile mills of the South cheap labor led to the creation of many jobs despite poor wages, many white Southerners saw employment as a blessing. The South in the Age of Industry

Impact of the New Industrial Revolution standard of living rose immigrants swarmed to the U.S. early Jeffersonian ideals about the dominance of agriculture fell.

Impact of the New Industrial Revolution Gibson Girl Cultural icon who represented women who had swarmed to factories encouraged by recent inventions found new opportunities created by Charles Dana Gibson became the romantic ideal of the age. young, athletic, attractive, and outdoorsy (not the stay-at-home mom type).

In Unions There Is Strength Background: immigrants were providing a labor force that would work for low wages & in poor environments, workers who wanted to improve their conditions couldnt: bosses could easily hire unemployed to take their places

Corporations weapons against strikers hiring strikebreakers asking the courts to order strikers to stop striking & if they continued, to bring in troops. hiring scabs or replacements lockouts to starve strikers into submission often, workers had to sign ironclad oaths or yellow dog contracts banned them from joining unions blacklist employees put on a list and denied privileges elsewhere. In Unions There Is Strength

middle-class response to workers? annoyed by the recurrent strikes grew deaf to the workers outcry. people like Carnegie & Rockefeller had battled & worked hard to get to the top, so? workers could do the same if they really wanted to improve their situations. In Unions There Is Strength

Labor Limps Along Civil War increased the demand for labor helped labor unions grow. The National Labor Union (1866) represented a giant boot stride by workers attracted an impressive total of 600,000 members, but it only lasted 6 years excluded Chinese & didnt really try to get Blacks & women to join. worked for the arbitration of industrial disputes Worked for the 8-hour workday Won that for government workers, but the depression of 1873 knocked it out.

Knights of Labor (1869 ) continued secretly until 1881 similar to the National Labor Union only barred liquor dealers, professional gamblers, lawyers, bankers, and stockbrokers campaigned for economic & social reform. Led by Terence V. Powderly won a number of strikes for the 8-hour day successful strike against Jay Goulds Wabash Railroad in 1885 membership mushroomed to of a million workers. Labor Limps Along

Knights of Labor Terence V. Powderly An injury to one is the concern of all!

Knights of Labor Knights of Labor trade card

Goals of the Knights of Labor Eight-hour workday. Workers cooperatives. Worker-owned factories. Abolition of child and prison labor. Increased circulation of greenbacks. Equal pay for men and women. Safety codes in the workplace. Prohibition of contract foreign labor. Abolition of the National Bank.

Unhorsing the Knights of Labor Knights became involved in a number of May Day strikes (1/2 failed) Chicago (Haymarket Square Bombing) home to about 80,000 Knights (& a few hundred anarchists that advocated a violent overthrow of the American government) tensions had been building May 4, 1886, Chicago police were advancing on a meeting that had been called to protest brutalities by authorities dynamite bomb was thrown, killing or injuring several dozen people.

Haymarket Square Bombing (cont.) 8 anarchists rounded up no one could prove that they had any association with the bombing since they had preached incendiary doctrines, the jury sentenced 5 of them to death On account of conspiracy gave the other 3 stiff prison terms.

In 1892, John P. Altgeld German-born Democrat is elected governor of Illinois pardoned the 3 survivors after studying the case extensively Received violent verbal abuse for that was defeated during re-election. Result: Haymarket Square Bombing is associated with the Knights of Labor & anarchists lowered their popularity & effectiveness membership declined those that remained fused with other labor unions. Haymarket Square Bombing (cont.)

Haymarket Riot (1886) McCormick Harvesting Machine Co.

Haymarket Martyrs

Governor John Peter Altgeld

The AF of L to the Fore Samuel Gompers : founded the American Federation of Labor (1886) an association of self-governing national unions, each of which kept its independence the AF of L = unifying overall strategy. Gompers demanded a fairer share for labor. He simply wanted more, : sought better wages, hours, & working conditions.

The American Federation of Labor: 1886 Samuel Gompers

How the AF of L Would Help the Workers Catered to the skilled worker. Represented workers in matters of national legislation. Maintained a national strike fund. Evangelized the cause of unionism. Prevented disputes among the many craft unions. Mediated disputes between management and labor. Pushed for closed shops.

The AF of L established itself on solid but narrow foundations tried to speak for all workers, but didnt quite do that It was composed of skilled laborers Let unskilled laborers fend for themselves Critics called it the labor trust. The AF of L to the Fore

The stats: 1881-1900: there were over 23,000 strikes involving 6,610,000 workers total loss to both employers & employees of about $450 million. Greatest weakness of labor unions? only embraced a small minority3%of all workers The AF of L to the Fore

By 1900: public began to concede the rights of workers They got some or most of what they wanted. 1894, Labor Day = legal holiday few owners realized that losing $ to fight labor strikes = useless though most owners still dogmatically fought labor unions. Age of big business had dawned Age of big labor was still some ways away The AF of L to the Fore

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The American Pageant Chapter 24 Industry Comes of Age Cover Slide Copyright © Houghton Mifflin Company. All rights reserved. Adapted from: Ms. Susan M