The Rise of Industrial America1865-1900
Industrial Growth: 1865-1900Industrial Growth
CausesUS has wealth of natural resourcesExplosion of inventions = better business and manufacturing efficiencyGrowing urban population provides workers and marketsRR establish new markets - spur business growth
EffectsBig business emergesBusiness consolidates under monopolies and trustsWorkers endure harsh conditionsLabor unions developMajor strikes by industrial workers = violence
Important individuals in the late 1800s
Growth of Big Business: CausesTechnological boomHeavy investment in technologyRR encourage expansion of businessSocial Darwinism = favorable public opinion
Railroads Create National NetworkAfter the Civil War rail tracks started to follow a standard tracks and signals.The key event to the rail expansion was the Transcontinental Railroad Railway that traveled from coast to coast.Railroads adopted time zones in 1883.
Thomas EdisonMenlo Park LaboratoryElectricityElectric Light BulbGeneral ElectricPower PlantsGrammaphoneProlific Inventor
The Bessemer ProcessProcess allowed for the mass production of steel. Steel became cheaper and more available.With steel in greater supply new building projects were undertaken.The Brooklyn Bridge became the symbol of the new era of American technological innovations.
Growth of Big Business: MethodsVertical integration (Carnegie Steel)Horizontal consolidation [integration] (Standard Oil)TrustsEconomies of ScaleMonopolistic tendencies
The Big Business ModelBusinesses in the late 1800s transformed into a completely new form because of many factors:Larger Pool of Capital (Money) businesses needed large amounts of money to run. Turned to private investors.Wider Geographic Span railroads allowed businesses to have operations throughout the country.Broader Range of Operations Became responsible for all stages of operation.Revised Role of Ownership Owning and management became two different things.New Methods of Managements Specialized departments (HR, Accounting, Security, Benefits) were created to manage such large companies.What it takes to run a large company.
Rockefeller & CarnegieJohn D. Rockefeller Formed Standard Oil Company in 1870 and soon became one of the worlds richest men. Business tactics were questionable.By the end of his life he gave $500 million in charity to help fund social well being.Andrew Carnegie Became the main supplier of steel in U.S. in late 1800s.Believed in Gospel of WealthGave away 80% of fortune to education alone.
He was no Santa Clause
Which one?Captains of IndustryRobber Barons
Growth of Big Business: FeaturesLarge pools of capitalWider Geographic reachChanged role of ownership - professional managersNew administrative techniquesOligopolyRobber Barons or Captains of Industry --- Industrial Statesmen?
Growth of Big Business: Government RelationsGovernment:Friendly to big businessMinimal interference (laissez-faire = hands off)Sherman Antitrust Act (1890) - first used against labor unions NOT big business. (Would later change)
Bosses of the Senate
Growth of Big Business: Effects IUS becomes industrial power internationallyMany jobs available for immigrants & failed farmersBetter business efficiencyHigher productivityBusiness cycles = Boom and BustSocial class of super rich is createdIncome gap grows widerLabor Unions increased presence
Growth of Big Business: Effects IIIncreased number of workers = decreased wages (generally)Families workIncreased mechanization = less need for human laborNo insurance or benefits for most industrial workersChild laborPoor conditions = bad health of workers
Boom and Bust Cycles
Gradual Shift to Industrialized Labor
Child Labor: 1870-1930
Major Labor Strikes of the Late 19th century (1870s-1890s)
Social DarwinismBig businessmen began to adopt Social Darwinism.An extension of Darwins natural selection process.Social Darwinists argued that society should interfere with competition as little as possible.Believed government should stay out of businesses who were most fit to succeed and become rich.Believed society would benefit from the success of the fit by weeding out the unfit.