6.1

The Expansion of Industry

At the end of the 19th century, natural resources, creative ideas, and growing markets fuel an industrial boom.

Natural Resources Fuel Industrialization

The Growth of Industry1920s: U.S. leading industrial power

•Wealth of natural resources•Government support for business•Increased urban population

Black Gold1859: Edwin L. Drake uses steam engine to drill for oil

•kerosene, then gasoline

Bessemer Steel ProcessAbundant deposits of coal, iron spur industry—Bessemer process

•Iron into steel by injecting air an removing carbon•Replaced by open-hearth process

New Uses for Steel• railroads, barbed wire, farm machines• construction:

•Brooklyn Bridge•steel-framed skyscrapers

Inventions Promote Change

The Power of Electricity1876: Thomas Alva Edison first research laboratory

•1880: patents incandescent light bulb•system for electrical production, distribution

Impact in Industrialization•manufacturers can locate plants anywhere; industry grows•available in homes; encourages invention of appliances

Inventions Change Lifestyles1867: Christopher Sholes—typewriter 1876: Alexander Graham Bell—telephone

Impact on Industrialization• Women in workforce

•1910: 40% of clerical workers are women•clothing factories

• improves standard of living•1890: average workweek 10 hours shorter

• as consumers, workers regain power in market

Dissent: mechanization reduces value of human worker

The growth &consolidation of railroads benefits the nation but also leads to corruption that would

require government regulation.

6.2

The Age of the Railroads

Railroads Span Time and Space

Railroads Encourage Growth•local transit and westward expansion •Govn’t: land grants, loans to railroads to settle West

A National Network•1859: railroads extend west of Missouri River•1869: first transcontinental railroad, spans the nation

Romance and Reality•offer land, adventure, fresh start•Railroads built under harsh conditions:

•Central Pacific: Chinese immigrants•Union Pacific: Irish immigrants, Civil War vets•Accidents & disease

•1888: 2,000 killed; 20,000 injured

Railroad Time•Lack of uniform schedules•1869: C. F. Dowd proposes 24 time zones•1883: U.S. railroads, towns adopt time zones

•internat’l conference sets world zones via railroad time•1918: Congress adopts railroad time

Opportunities and Opportunists

New Towns and Markets• Iron, coal, steel, lumber, glass industries ↑• RR link towns, promote trade; interdependence• Nationwide network of suppliers, markets

•specialization

Pullman, Illinois•1880: George M. Pullman builds railcar factory•Provides: housing, doctors, shops, sports field•Company controls residents → stable work force

Crédit Mobilier• 1864: Union Pacific stockholders form construction co.—Crédit

Mobilier •overpay for laying track, pocket profits

• Republican politicians implicated; party tarnished

The Grange and the Railroads

Grange—farmer’s organization•angry over perceived railroad corruption

•Land grants, fixed prices, different rates

NEXT

Granger Laws•Press for laws to protect farmers’ interests•Munn v. Illinois—upholds states’ right to regulate RR

•Fed. government can regulate private industry

Interstate Commerce Act1886: Court rules states cannot set rates on interstate

commerce

1887: Interstate Commerce Act •fed. govn’t supervise railroads•est. Interstate Commerce Commission (ICC)

Panic and Consolidation• Abuses, mismanagement, competition bankrupt many railroads• Panic of 1893 • 1894: 25% railroads taken over by financial companies

The expansion of industry results in the growth of big business and prompts laborers to form unions to better their lives.

6.3

Big Business and Labor

NEXT

Carnegie’s Innovations

New Business StrategiesGOAL: make better products more cheaply

•Hires talented staff; offers company stock; promotes competition•vertical integration—buys out suppliers; control materials•horizontal integration merges with competition

Carnegie controls almost entire steel industry

NEXT

Social Darwinism and Business

Principles of Social Darwinismtheory of biological evolution applied to society: Social Darwinism

•Natural selection•Economists use to justify doctrine of laissez faire

A New Definition of Success•success of the most capable appeals to wealthy•individual responsibility follows Protestant ethic

•riches as sign of God’s favor•poor must be lazy, inferior

NEXT

Growth and ConsolidationMergers: buy out competitorsMonopolies: control production, wages, prices

•Holding companies: buy stock of other companies

John D. Rockefeller and Standard Oil Company•trust; trustees run separate companies as if one

Fewer Control More

Rockefeller and the “Robber Barons”Profits:•low wages and underselling•control market → raise prices

Robber barons as philanthropists

NEXT

Sherman Antitrust ActGovernment concern: expanding corporations stifle free competitionSherman Antitrust Act: trust illegal if interferes with free trade

Business Boom Bypasses the South•North owns 90% of stock in RR, most profitable Southern businesses •Business problems: high transport cost, tariffs, few skilled workers

Labor Unions Emerge

Long Hours and Danger•Exploitation, unsafe conditions unite workers

•1882: 675 workers killed each week•12-hour days, 6 day/week; repetitive tasks•no vacation, sick leave, or injury compensation

•Women and children: sweatshops•require few skills; lowest wages

Early Labor Organizing•National Labor Union (NLU)

•Local chapters reject blacks; CNLU forms•1868: Congress legalizes 8-hour day to civil servants

•Noble Order of the Knights of Labor, Uriah Stephens •Open to all races, genders, degrees of skill•8-hour day, equal pay, arbitration•Strikes as last resort

NEXT

Union Movements Diverge

Craft Unionism: skilled workers from one or more tradesSamuel Gompers and the American Federation of Labor (AFL)

•collective bargaining for better wages, hours, conditions•strike successfully, wins higher pay, shorter workweek

Industrial Unionism: skilled & unskilled workers in an industry•Eugene V. Debs forms American Railway Union (ARU); strikes

Socialism and the IWWSocialism

•factors of production owned and operated by the people• equal distribution of wealth

1905: Industrial Workers of the World (IWW or Wobblies)•radical unionists, socialists; include African Americans•Industrial unions give unskilled workers dignity, solidarity

NEXT

Strikes Turn Violent

The Great Strike of 1877•B&O Railroad strike spreads—50,000 miles•impeding interstate commerce; federal troops intervene

The Haymarket Affair•3,000 gather at Chicago’s Haymarket Square, protest police brutality•Violence ensues; 8 charged with inciting riot, convicted•Public opinion turns against labor movement

The Homestead Strike•1892, Carnegie Steel workers strike over pay cuts•Win battle against Pinkertons; National Guard reopens plant•Steelworkers do not remobilize for 45 years

The Pullman Company Strike•lays off 3,000, cuts wages but not rents; workers strike•Pullman refuses arbitration; violence ensues; federal troops sent•Debs jailed, most workers fired, many blacklisted

NEXT

Women OrganizeWomen barred from many unionsMary Harris Jones: United Mine Workers

•1903: leads children’s march to Roosevelt’s homePauline Newman—International Ladies’ Garment Workers

Management and Government Pressure Unions•Employers forbid unions; turn Sherman Antitrust Act against labor•Legal limitations cripple unions, but membership rises

1911: Triangle Shirtwaist factory fire