INDUSTRY COMES OF AGE, INDUSTRY COMES OF AGE, 1865-1900 1865-1900

Chapter 24Chapter 24

The Iron Colt Becomes An Iron HorseThe Iron Colt Becomes An Iron Horse

RR building exploded after the Civil War. RR building exploded after the Civil War. US government subsidized the first two US government subsidized the first two

transcontinental RR transcontinental RR How land-grants workedHow land-grants worked Why subsidies were necessary.Why subsidies were necessary. In all RR got over 200 Mill acres from Feds In all RR got over 200 Mill acres from Feds

and states—area larger than the state of and states—area larger than the state of Texas.Texas.

Benefits of SubsidiesBenefits of Subsidies

US benefited from giving land to US benefited from giving land to RR. How?RR. How? RRs promoted immigration RRs promoted immigration promoted of westward migration.promoted of westward migration. RR gave the government a break RR gave the government a break

on mail and military transport. on mail and military transport. Free land a cheap way to Free land a cheap way to

subsidize. subsidize. Why?Why?

Spanning The Continent With RailsSpanning The Continent With Rails After secession, Congress Commissioned After secession, Congress Commissioned

a transcontinental RR. a transcontinental RR. Union Pacific and Central Pacific. Union Pacific and Central Pacific. 20 square miles of land for each mile of 20 square miles of land for each mile of

track laidtrack laid Building began in earnest in 1865 after the Building began in earnest in 1865 after the

Civil War.Civil War. Credit Mobiler scandalCredit Mobiler scandal

Completion of transcontinental RailroadCompletion of transcontinental Railroad

CP was led by "The Associates," familiarly known as the "Big Four," who pushed the project to completion with its share of rancor and scandal. Leland Stanford became president and later served as California governor and U.S. senator. He founded Stanford University in honor of his son, who died at 16. Collis Huntington, vice president, secured suppliers for the railroad and attracted investors to fund it. Charles Crocker was head of construction and got the railroad built through torturous terrain. Mark Hopkins handled the railroad's accounts and maintained harmony among the three younger men

Building the RailroadsBuilding the Railroads On both lines mostly poor On both lines mostly poor

immigrants did the work. immigrants did the work. Irish were predominant on Irish were predominant on

the UP linethe UP line Chinese on the Central Chinese on the Central

Pacific line. Often beset Pacific line. Often beset by Indians.by Indians.

Moving tent cities Moving tent cities Hundreds of labors died.Hundreds of labors died. Significance of Significance of

transcontinental RRtranscontinental RR

Binding The Country With Railroads Binding The Country With Railroads

Four other Transcontinental lines were Four other Transcontinental lines were built. None received cash grants, but built. None received cash grants, but three received land grants.three received land grants.

Many other RR went bankrupt and fleeced Many other RR went bankrupt and fleeced investors. investors.

Towns competed with bribes to RR Towns competed with bribes to RR promoters to get the RR to come to their promoters to get the RR to come to their town. Many of these RR took the money town. Many of these RR took the money and ran.and ran.

Federal Land Grants to RailroadsFederal Land Grants to Railroads

Cornelius Vanderbilt Cornelius Vanderbilt Railroad Railroad Consolidation and Consolidation and

mechanizationmechanization Cornelius VanderbiltCornelius Vanderbilt welded welded

together and expanding older together and expanding older eastern Network. eastern Network.

Had made a huge fortune in Had made a huge fortune in steamboats and used this wealth steamboats and used this wealth to fund RRs. to fund RRs.

He was coarse, ill educated, He was coarse, ill educated, ungrammatical and ruthless, but ungrammatical and ruthless, but knew how to make money.knew how to make money.

Railroad Consolidation and Railroad Consolidation and MechanizationMechanization

Significant Improvements to RR facilitated Significant Improvements to RR facilitated growth of railroads:growth of railroads: Steel railSteel rail Standard gauge track:Standard gauge track: WestinghouseWestinghouse brake brake PullmanPullman sleeping cars: sleeping cars: made travel more made travel more

comfortable for passengers—1860s.comfortable for passengers—1860s. Trains still dangerous.Trains still dangerous.

Revolution By RailwaysRevolution By Railways Transcontinental RR caused many changes:Transcontinental RR caused many changes:

Stimulated American economy Stimulated American economy Stimulated manufacturing and industrialization Stimulated manufacturing and industrialization Westward expansion of agriculture Westward expansion of agriculture Stimulated immigration Stimulated immigration Bigger cities Bigger cities Settlement of the unsettled areas Settlement of the unsettled areas Time zones Time zones Created Millionaires Created Millionaires Changed Western ecologyChanged Western ecology

Wrongdoing in RailroadingWrongdoing in Railroading

The railroads were The railroads were rife with corruption rife with corruption

Jay GouldJay Gould Stock WateringStock Watering BriberyBribery Trusts and Pooling Trusts and Pooling

AgreementsAgreements RebatesRebates

Government Bridles The Iron HorseGovernment Bridles The Iron Horse

Farmers resented the RR Farmers resented the RR Why? Why?

Generally, the country was slow to respond to Generally, the country was slow to respond to abuses of RR. abuses of RR. Laissez faireLaissez faire

Depression of 1870 spurred the government into Depression of 1870 spurred the government into action. action.

GrangeGrange put pressure on many Midwestern put pressure on many Midwestern legislatures to regulate the RR monopoly. legislatures to regulate the RR monopoly.

State laws held unconstitutional in the famous State laws held unconstitutional in the famous Wabash caseWabash case. Why?. Why? Interstate commerce could not be regulated by statesInterstate commerce could not be regulated by states

Interstate Commerce ActInterstate Commerce Act Interstate Commerce ActInterstate Commerce Act in 1887.in 1887.

Prohibited rebates and poolsProhibited rebates and pools Required RR to publish their rates openlyRequired RR to publish their rates openly Outlawed discrimination against shippersOutlawed discrimination against shippers outlawed charging more for short hauls than for long outlawed charging more for short hauls than for long

onesones Set up the Set up the Interstate Commerce CommissionInterstate Commerce Commission to to

administer and enforceadminister and enforce Was not a revolutionary victory; simply modest Was not a revolutionary victory; simply modest

regulation regulation Did provide an orderly forum. Did provide an orderly forum. water-shed in establishing the power of water-shed in establishing the power of

government to regulate businessgovernment to regulate business

Miracles of MechanizationMiracles of Mechanization 1865-1895 saw a huge industrial boom. 1865-1895 saw a huge industrial boom. Reasons:Reasons:

Much more Much more liquid capitalliquid capital natural resourcesnatural resources started to be exploited started to be exploited Massive immigrationMassive immigration provided cheap unskilled labor provided cheap unskilled labor American inventions made businesses and factories American inventions made businesses and factories

more efficient.more efficient. telegraph, mass production, cash register, stock ticker .telegraph, mass production, cash register, stock ticker .

TelephoneTelephone (1876) and expanded (1876) and expanded telegraph; telegraph; communications revolution. “Telephoniacs”communications revolution. “Telephoniacs”

EdisonEdison and Electric Light and Electric Light

Thomas Alva EdisonThomas Alva Edison

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

The Trust Titan EmergesThe Trust Titan Emerges

Businesses, left alone, hate competition. Businesses, left alone, hate competition. Ways to avoid competition.Ways to avoid competition.

Vertical Integration--Andrew Carnegie’s Steel Vertical Integration--Andrew Carnegie’s Steel operations. More effeciantoperations. More effeciant

Horizontal Integration, wipe out competiationHorizontal Integration, wipe out competiation—Rockefeller and Standard Oil —Rockefeller and Standard Oil

Trusts—Rockefeller “ Let us Prey”Trusts—Rockefeller “ Let us Prey” Interlocking Directorates—J.P. Morgan put Interlocking Directorates—J.P. Morgan put

bank managers on all board of directorsbank managers on all board of directors

The Supremacy Of SteelThe Supremacy Of Steel

Steel became King after the Civil War. Steel became King after the Civil War. Foundation for much of the industrial Foundation for much of the industrial

expansion expansion Bessemer processBessemer process.. America biggest Steel producer by 1900. America biggest Steel producer by 1900.

Produced 1/3 of the world’s steel.Produced 1/3 of the world’s steel. Why America dominant. Why America dominant.

Carnegie And Other Sultans Of SteelCarnegie And Other Sultans Of Steel

Andrew Carnegie—US Andrew Carnegie—US SteelSteel

King of American SteelKing of American Steel Produced ¼Produced ¼

Carnegie cleared 25 Mil. Carnegie cleared 25 Mil. a year. Huge fortunea year. Huge fortune

Sold out to J.P. Morgan Sold out to J.P. Morgan for 400 Million.for 400 Million.

Spent the rest of his life Spent the rest of his life giving money awaygiving money away

Rockefeller and Standard OilRockefeller and Standard Oil

Oil industry emerges after the Oil industry emerges after the Civil War.Civil War.

Rockefeller and Standard Oil. Rockefeller and Standard Oil. ruthless. ruthless. Big believer in commercial Big believer in commercial

Darwinism.Darwinism. By 1877 controlled 95% of all By 1877 controlled 95% of all

the old refineries in the country.the old refineries in the country. Benefits.Benefits.

Standard Oil—The OctopusStandard Oil—The Octopus

The Gospel of WealthThe Gospel of Wealth Social obligations of new Social obligations of new

super-rich?super-rich? Charles Graham SumnerCharles Graham Sumner

Get richer; none to poorGet richer; none to poor ““Social Darwinism”Social Darwinism”

Rich deserve to be rich; Rich deserve to be rich; poor deserve to be poorpoor deserve to be poor

Contempt for poor who had Contempt for poor who had “earned” their own poverty“earned” their own poverty

Russell ConwellRussell ConwellCharles Graham Charles Graham SumnerSumner

Carnegie’s Gospel of WealthCarnegie’s Gospel of Wealth

Inequality is inevitable and Inequality is inevitable and good.good.

Wealthy should act as Wealthy should act as “trustees” for their “poorer “trustees” for their “poorer brethren.”brethren.”

Wealthy had to prove they Wealthy had to prove they deserved their wealth.deserved their wealth.

Give back to the community Give back to the community as a whole, not to individualsas a whole, not to individuals

Carnegie gave away millionsCarnegie gave away millions

Government Tackles The Trust EvilGovernment Tackles The Trust Evil Sherman Anti Trust Act of 1890. Sherman Anti Trust Act of 1890. Forbids combinations in restraint of trade. Forbids combinations in restraint of trade.

Did not prove very effective because went after Did not prove very effective because went after bigness and not badness. bigness and not badness.

Not very effective because penalties weak and Not very effective because penalties weak and loopholes loopholes

Biggest effect was unintended--Was used against Biggest effect was unintended--Was used against unions.unions.

Importance of the law was not its immediate Importance of the law was not its immediate effect but the shift in thinking that it represented. effect but the shift in thinking that it represented.

The South In The Age Of IndustryThe South In The Age Of Industry

South did not benefit muchSouth did not benefit much Produced smaller % of Manufacturing Produced smaller % of Manufacturing

goods than pre-Civil Wargoods than pre-Civil War James Duke—CigarettesJames Duke—Cigarettes Barriers to Southern developmentBarriers to Southern development

Railroad rate discriminationRailroad rate discrimination Textile MillsTextile Mills

Pros and ConsPros and Cons

The Impact Of IndustrializationThe Impact Of Industrialization Increased wealth of nationIncreased wealth of nation Standard of living rose sharplyStandard of living rose sharply Workers enjoyed many more physical comfortsWorkers enjoyed many more physical comforts Urban centers mushroomedUrban centers mushroomed Jeffersonian Ideal of nation of small farmers died Jeffersonian Ideal of nation of small farmers died Concept of time changed. Concept of time changed. Many more women in the workforceMany more women in the workforce Delayed marriages and smaller familiesDelayed marriages and smaller families New class systemNew class system Workers becoming more dependent and more Workers becoming more dependent and more

vulnerable. vulnerable.

In Unions There is StrengthIn Unions There is Strength Surplus of unskilled labor.Surplus of unskilled labor. Individual workers were powerless to bargain Individual workers were powerless to bargain Early Unions had little power, as well. Early Unions had little power, as well.

strike-breakers, lawyers and thugs (“Oh my!”)strike-breakers, lawyers and thugs (“Oh my!”) Courts issued injunctions against strikes based Courts issued injunctions against strikes based

on Anti-Trust laws. on Anti-Trust laws. Yellow-dog contractsYellow-dog contracts Black-lists Black-lists Company storesCompany stores Middle-class was largely unsympathetic.Middle-class was largely unsympathetic.

Labor Limps AlongLabor Limps Along

Unions strengthened after the Civil War.Unions strengthened after the Civil War. National Labor Union organized in 1866 National Labor Union organized in 1866

and did well, and did well, 600,000 members, both skilled and unskilled600,000 members, both skilled and unskilled Did not recruit women or blacksDid not recruit women or blacks Goals: arbitration of industrial disputes, 8-hour Goals: arbitration of industrial disputes, 8-hour

dayday damaged by the depression in the 1870s.damaged by the depression in the 1870s.

Knights of Labor

Terence V. Terence V. PowderlyPowderly

An injury to one is the concern of An injury to one is the concern of all!all!

Knights of Labor took over Knights of Labor took over where the National Labor Union where the National Labor Union had left off. had left off. Sought to include all labor in one Sought to include all labor in one

big Union. big Union. They stayed out of politics, but They stayed out of politics, but

campaigned hard for economic and campaigned hard for economic and social reform. social reform.

Their biggest issue was the 8-hour Their biggest issue was the 8-hour work day. work day.

Won that fight from a number of Won that fight from a number of industries and their ranks swelled.industries and their ranks swelled.

Unhorsing The Knights Of LaborUnhorsing The Knights Of Labor Knights of Labor riding for a fallKnights of Labor riding for a fall Problems:Problems:

The Haymarket Square incident in Chicago in The Haymarket Square incident in Chicago in 1886 1886

Fusion of both skilled and unskilled labor. Fusion of both skilled and unskilled labor. Skilled workers abandoned the Knights for Skilled workers abandoned the Knights for

the American Federation of Labor.the American Federation of Labor. This dealt the Knights a death blow, and This dealt the Knights a death blow, and

the union slowly withered.the union slowly withered.

Haymarket Riot (1886)

McCormick Harvesting Machine Co.McCormick Harvesting Machine Co.

The AF Of L To The ForeThe AF Of L To The Fore AF of L --1886 AF of L --1886 Brain child of Samuel Gompers. Brain child of Samuel Gompers. President of the union every year President of the union every year

for 38 years but one.for 38 years but one. Confederation of self-governing Confederation of self-governing

independent unions for skilled independent unions for skilled laborers.laborers.

Gompers political strategy. Gompers political strategy. Major goal was closed shop. Major goal was closed shop. Weapons were walk-outs and Weapons were walk-outs and

boycotts.boycotts.

The AF Of L To The ForeThe AF Of L To The Fore

Let unskilled workers, Let unskilled workers, blacks and woman fend blacks and woman fend for themselves.for themselves.

500,000 members by 500,000 members by 1900.1900.

1881-1900 over 23,000 1881-1900 over 23,000 strikesstrikes

By 1900, increased but By 1900, increased but fragile supportfragile support

1894—Labor Day holiday.1894—Labor Day holiday. Most employers still Most employers still

fought labor aggressively. fought labor aggressively.

Management vs. Labor

““Tools” of Tools” of ManagementManagement

““Tools” of Tools” of LaborLabor

““scabs”scabs” P. R. campaignP. R. campaign PinkertonsPinkertons lockoutlockout blacklistingblacklisting yellow-dog yellow-dog

contractscontracts court injunctionscourt injunctions open shopopen shop

boycottsboycotts sympathy sympathy

demonstrationdemonstrationss

informational informational picketingpicketing

closed shopsclosed shops organized organized

strikesstrikes ““wildcat” wildcat”

strikesstrikes