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The Triumph of Industry1865-1914
New York City, 1860s
Key Terms and People
EntrepreneurProtective TariffLaissez fairePatentThomas EdisonBessemer processSuspension bridgeTime zoneMass production
Essential Question:
How did industrialization and new technology affect the economy and society?
First Industrial Revolution
Began in Britain during 1700s - Textile Industry
Key Components:Steam EngineFactory System
Key Resources:IronCoal Diagram of Watt’s Steam
Engine, 1755
Second Industrial Revolution
Began around 1850s
Dominated by steel, oil and electricity
Bessemer Furnace, Kelham Island Museum, Sheffield England
Think About It…
• What sorts of items were necessary during the Civil War?
• How did the Civil War encourage industry?
America’s Natural Resources
Vast resource supply helped fuel growthCoal mines along east coast
Thick forests cut down for lumber
First oil well drilled in 1859
Strip Coal Mine, Sullivan County, PA
Immigration in the U.S.
Post Civil War – large influx of Europeans and Asians due to:Political unrestReligious discriminationCrop failures
1881 – 750,000 immigrants 1905 – more than 1,000,000 per year
What impact might this have had on industry?
Street Life in New York
Published in 1868 by Horatio Alger
Told the story of a poor boy who rose to wealth and fame by working hard
From “rags to riches” story
Horatio Alger, 1832-1899
What is Capitalism?
Free enterprise; individuals own most businesses
Entrepreneurs – people who invest money in a business or product in order to make a profit.Can you think of any other
economic systems?
Government Policies
Gave railroad builders large pieces of land in order to link East and West coasts.
Protective Tariffs – taxes that made imported goods cost more.
Laissez-faire – allowed businesses to operate under minimal government regulation.
Think About It…
• What factors spurred industrial growth in the late 1800s?
Innovation Drives the Nation
Patent – grant by the federal government giving the inventor the exclusive right to develop, use, and sell an invention for a set period of time
Original Microwave Oven PatentDr. Percy Spencer, 1950
Major Inventions of the 1800s
1844 – Telegraph1846 – Sewing Machine
1852 – Safety Elevator
1880 – Light Bulb1884 – Steam Boiler Furnace
Thomas Edison
The Bessemer Process
Steel – Henry Bessemer, a British engineer, developed a process for purifying iron, which resulted in a strong, lightweight steel.
What impact do you think this had on society? What is steel currently
used for?Drawing of Henry Bessemer, Vanity Fair, 1880
Technology and Transportation
1883 – Three transcontinental railroad lines in the U.S.
1884 – Delegates from 27 countries decided to divide the world into 24 time zones, one for each hour of the day
During most of the 1800s towns set their clocks independently. By 1883, why did this become a problem?
The Railroad Effect
Trains transported large amounts of goods, cheaply, quickly and efficiently
Allowed business to obtain raw materials easily, and opened up new markets to sell goods
What is mass production?
Why did this occur?
Railroad Steam Engine, late 1800s
Think About It…
How did new technologies shape industrialization?
Impact of Industrialization
Globalization Linked world markets; American economy expanded As United States grew into a world power, it often conflicted with
political views and political policies of other countries.
American Society Farms became mechanized=fewer workers, joblessness=influx of
workers to cities Greater access to goods and products; no longer made items by
hand Increased cost of living, depended on cash wages
Environment Late 1800s – industrial waste is rapidly rising = Midwest; soil
erosion and dust storms Congress’ response – National Park Service; Yellowstone, 1872
Question for Reflection
What impact did industrialization have on Americans?
The Rise of Big Business
Key Terms and People: Corporation Monopoly Cartel John D. Rockefeller Horizontal integration Trust Andrew Carnegie Vertical integration Social Darwinism Interstate Commerce
Commission Sherman Antitrust Act
Essential Question:
How did big business shape the American economy in the late 1800s and early 1900s?
Think About It…
Before the Industrial
Revolution businesses were
not very large. How did the IR change this?
Corporations
Corporation – A business in which a number of people share in the ownership
Advantages –Greater access to
resourcesShare cost of ownershipHas the same rights as
individuals (buy and sell land, sue in court, etc.)
The Competitive Edge
Wide-spread advertisingJP Morgan – investing in
researchMonopoly – corporation
that has complete control of a product
Cartel – group of corporations that band together in order to eliminate competition from other businesses
J.P. Morgan John D. Rockefeller
Henry Flagler Andrew Carnegie
Horizontal and Vertical Integration
Horizontal Integration – creating a giant company with low production costs by consolidating many firms into one companyEx. Rockefeller – Standard Oil Company
Vertical Integration – consolidating many different businesses involved with the development of a specific productEx. Rockefeller and Carnegie
What is a Trust?
Ohio law prevented one company from owning stock in another, thus preventing horizontal integration.
Rockefeller’s lawyer created the TRUST to get around this law.
Trust – companies assign their stock to a board of trustees, who combine them into a new organization. The trustees run the organization, and then pay themselves dividends on the profits.
Think About It…
What strategies did corporations use to decrease costs and increase profits?
Robber Barons or Captains of Industry?
Provided jobs for millions of workers
Technological development
Economy boomed
CAPTAINS OF INDUSTRY!
Small businesses squeezed out of business
Cartels often set unfairly high prices
ROBBER BARON!
Social Darwinism
Charles Darwin, On the Origin of Species (1859); animals evolved based on the process of natural selection – “Only the strong survive”
This theory was soon applied to American capitalism. What do you think were the results of this?
Social Darwinism
Wealth was a measure of one’s inherent value; those who had it were most ‘fit’
Laissez-faire: Government should stay out of the business world. This process of “natural selection” would make the country grow rich and strong.
Many used this theory to validate racist beliefs and values. Cited poverty-stricken condition as evidence of the inferiority of minorities!
Government Regulations Interstate Commerce Commission (1887)
Oversaw railroad industry to fight price-fixing and pooling First government agency to regulate business, but was
weak: Could only monitor railroads that crossed state lines Could not make laws or control railroads transactions Could force railroad industry to submit records to Congress
Government RegulationsSherman Antitrust Act (1890)
Outlawed any trust that operated “in restraint of trade or commerce among the several states.”
Was rarely enforced but started a trend of government oversight and regulation
Sen. John Sherman