1. Bell Ringer – “Write down some of the work restrictions/limitations that you know of (ie: minimum

wage)

2. Notes sheet and study guide

3. Powerpoint – Industrialization in the US

AGENDA – 8/26/2013

Coach BlackCoach Black

THE RISE OF INDUSTRY

Gross National Product (GNP) – total value of all goods and services that a country produces

Eight times greater than it had been in 1865

Natural resources/transcont. Railroad accelerated US industrialization

LARGE WORKFORCE

Between 1860-1910 – population nearly tripled

Two Reasons

1. large families

2. immigration

1870-1910 – 17 million immigrants arrived in US

CAUSES OF RAPID INDUSTRIALIZATIONCAUSES OF RAPID INDUSTRIALIZATION

1. Steam Revolution of the 1830s-1850s.

2. The Railroad fueled the growing US economy:

First big business in the US.

A magnet for financial investment.

The key to opening the West.

Aided the development of other industries.

1. Steam Revolution of the 1830s-1850s.

2. The Railroad fueled the growing US economy:

First big business in the US.

A magnet for financial investment.

The key to opening the West.

Aided the development of other industries.

CAUSES OF RAPID INDUSTRIALIZATIONCAUSES OF RAPID

INDUSTRIALIZATION3. Technological innovations.

Bessemer and open hearth process

Refrigerated cars

Edison o “Wizard of Menlo Park”

o light bulb, phonograph, motion pictures.

3. Technological innovations. Bessemer and open hearth

process

Refrigerated cars

Edison o “Wizard of Menlo Park”

o light bulb, phonograph, motion pictures.

THOMAS ALVA EDISONTHOMAS ALVA EDISON

“Wizard of Menlo Park” “Wizard of Menlo Park”

THE LIGHT BULBTHE LIGHT BULB

THE PHONOGRAPH (1877)

THE PHONOGRAPH (1877)

THE EDIPHONE OR DICTAPHONE

THE EDIPHONE OR DICTAPHONE

THE MOTION PICTURE CAMERA

THE MOTION PICTURE CAMERA

ALEXANDER GRAHAM BELLALEXANDER GRAHAM BELL

Telephone (1876)Telephone (1876)

ALTERNATE CURRENTALTERNATE CURRENT

George WestinghouseGeorge Westinghouse

ALTERNATE CURRENTALTERNATE CURRENT

Westinghouse Lamp adWestinghouse Lamp ad

THE AIRPLANETHE AIRPLANE

Wilbur Wright Orville Wright Wilbur Wright Orville Wright

Kitty Hawk, NC – December 7, 1903 Kitty Hawk, NC – December 7, 1903

MODEL T AUTOMOBILEMODEL T AUTOMOBILE

Henry FordI want to pay my workers so that they

can afford my product!

Henry FordI want to pay my workers so that they

can afford my product!

“MODEL T” PRICES & SALES“MODEL T” PRICES & SALES

U. S. PATENTS GRANTEDU. S. PATENTS GRANTED

1790s 276 patents issued. 1790s 276 patents issued.

1990s 1,119,220 patents issued. 1990s 1,119,220 patents issued.

4. Unskilled & semi-skilled labor in abundance.

5. Abundant capital.6. New, talented group of businessmen

[entrepreneurs] and advisors.7. Market growing as US population increased.8. Government willing to help at all levels to

stimulate economic growth.9. Abundant natural resources.

4. Unskilled & semi-skilled labor in abundance.

5. Abundant capital.6. New, talented group of businessmen

[entrepreneurs] and advisors.7. Market growing as US population increased.8. Government willing to help at all levels to

stimulate economic growth.9. Abundant natural resources.

CAUSES OF RAPID INDUSTRIALIZATIONCAUSES OF RAPID INDUSTRIALIZATION

FREE ENTERPRISEFREE ENTERPRISE1. Laissez Faire “let the people

be”1. Laissez Faire “let the people

be” Individual as a moral and economic ideal.

Individuals should compete freely in the marketplace.

Gov’t not interfere w/ economy other than to protect private property rights.

Relies on supply and demand to regulate prices and wages

Low taxes and limited regulations on business

Individual as a moral and economic ideal.

Individuals should compete freely in the marketplace.

Gov’t not interfere w/ economy other than to protect private property rights.

Relies on supply and demand to regulate prices and wages

Low taxes and limited regulations on business

2. SOCIAL DARWINISM2. SOCIAL DARWINISM× British economist.× Advocate of

laissez-faire.× Adapted Darwin’s

ideas from the “Origin of Species” to humans.

× Notion of “Survival of the Fittest.”

× British economist.× Advocate of

laissez-faire.× Adapted Darwin’s

ideas from the “Origin of Species” to humans.

× Notion of “Survival of the Fittest.”Herbert SpencerHerbert Spencer

2. SOCIAL DARWINISM IN AMERICA

2. SOCIAL DARWINISM IN AMERICA

William Graham SumnerFolkways (1906)

William Graham SumnerFolkways (1906)

$ Individuals must have absolute freedom to struggle, succeed or fail.

$ Therefore, state intervention to reward society and the economy is futile!

$ Individuals must have absolute freedom to struggle, succeed or fail.

$ Therefore, state intervention to reward society and the economy is futile!

Tariffs – taxes on imports and exports

Tariffs contradicted laissez-faire

MORRILL TARIFF

Union Pacific Railway stockholders set up construction company called Credit Mobilier.

Credit Mobilier

UP and CM run by same people

Signed contracts with themselves

Overcharged on contracts = make more $

Members of Congress took stocks

CREDIT MOBILIER SCANDAL

Bell Ringer – Explain the concepts of laissez-faire government. How did advocates believe it would prosper?

Transcontinental Railroad notes

Section 1 of Study Guide

AGENDA 8/27

What is GNP?

What were the three components that accelerated US industrialization?

What were Edison’s big inventions? Graham Bell’s?

What was the objective of the Morrill Tariff ? Why was it a failure? What did it contradict?

REVIEW

Completed in four years

Connected US

Provided jobs – primarily immigrants (Chinese) - $1/day

-time zones were created to make rail service more reliable

-railroad companies were given land grants to sell

-money used to financed construction of railroad

TRANSCONTINENTAL RAILROAD

Cornelius Vanderbilt – steamboats first

Merged NY railroads

Responsible for construction of NY Grand Central

Then merged from Chicago to NY

Jay Gould

One of most corrupt railroad owners – “Robber baron”

Manipulated markets

Gordon-Gordon and Black Friday – Boss Tweed

KEY PLAYERS IN RAILWAYS

Explain – How did construction companies

BELL RINGER

NEW TYPE OF BUSINESS ENTITIES

NEW TYPE OF BUSINESS ENTITIES1. Pool

1887 Interstate Commerce Act Interstate Commerce Commission created.

2. Trust John D. Rockefeller

1. Pool 1887 Interstate Commerce Act

Interstate Commerce Commission created.

2. Trust John D. Rockefeller

Standard Oil Co. Standard Oil Co.

BIG BUSINESSThe Big Idea

The growth of big business in the late 1800s led to the creation of monopolies.

Main Ideas

• The rise of corporations and powerful business leaders led to the dominance of big business in the United States.

• People and the government began to question the methods of big business.

Many entrepreneurs formed their businesses in the late 1800s as corporations, or businesses that sell portions of

ownership called stock shares.

Corporate leaders were some of the most widely respected members of American society.

Successful corporations rewarded not only the people who founded them, but also investors who held stock.

Corporations encouraged more investment in businesses because stockholders could sell stock whenever they

wanted.

MAIN IDEA 1: THE RISE OF CORPORATIONS AND

POWERFUL BUSINESS LEADERS LED TO THE DOMINANCE OF BIG BUSINESS IN THE

UNITED STATES.

Andrew Carnegie• One of most

admired businesspeople of the time

• Focused on steelmaking

• Used vertical integration, owning businesses involved in each step of manufacturing, to lower costs

John D. Rockefeller

• Standard Oil Company was country’s largest refinery

• Developed horizontal integration, owning all businesses in a field

• Formed a trust, grouping many companies under a single board

BUSINESS LEADERS

Leland Stanford

• Made fortune selling equipment to miners

• Governor of California, one of founders of Central Pacific Railroad, and founder of Stanford University

People and the government began to view big business as a problem in the late 1800s.

Concerned about child labor, low wages, and poor working conditions

Many business leaders believed in social Darwinism.Darwin’s “survival of fittest” applied to which human beings

would succeed in business and in life in general.

Other business leaders believed that the rich should help the poor.

Carnegie, Rockefeller, Stanford, and other business leaders gave away large sums of money to charities.

MAIN IDEA 2:PEOPLE AND THE GOVERNMENT BEGAN TO

QUESTION THE METHODS OF BIG BUSINESS.

STANDARD OIL CO.STANDARD OIL CO.

NEW TYPE OF BUSINESS ENTITIESNEW TYPE OF BUSINESS ENTITIES

2. Trust: Horizontal Integration John D. Rockefeller

2. Trust: Horizontal Integration John D. Rockefeller

Vertical Integration:o Gustavus Swift Meat-packingo Andrew Carnegie U. S. Steel

Vertical Integration:o Gustavus Swift Meat-packingo Andrew Carnegie U. S. Steel

IRON & STEEL PRODUCTIONIRON & STEEL PRODUCTION

NEW TYPE OF BUSINESS ENTITIESNEW TYPE OF BUSINESS ENTITIES

1. Economy of Sale- cost of manufacturing decreased-done by using sales of stock

2. Fixed Costs – mortgage, taxes, loans, etc. Has to be paid

3. Operating Costs – paying employees, shipping, supplies

-such a small part of a massive corporations costs – even in tough times

– keep operating.

RUNNING A BUSINESS

Vertical Integration – owns all businesses for which it depends on

Carnegie needed – iron, limestone, coal, ships and trains – He bought them all

Horizontal integration – buyout competing companies , particularly w/ OIL refineries

-buy out an entire market - monopoly-US passed laws to make it illegal

Holding Companies – does not produce anything-owns stocks of companies that do

-essentially merging

BUSINESS FIND LOOPHOLES