A new industrial age

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Unit 6


In the Civil War (1860s) era, the USA was largely agricultural
By the 1920s USA is the world’s leading industrial power
Industry – power, energy, production, inventions, technology, factories
I. Natural Resources

  • Titusville, PA – oil is discovered. Used for lighting.

  • Coal Mining - 1870 – 33 Tons

1900 – 250 Tons

Used to produce heat, which produces steam, which produces power

  • Iron – iron to steel method perfected by Henry Bessemer. He discovers a way to make steel cheaply and effective.

      • Track, bridges, machines, towers, cables, skyscrapers. JOBS!

II. Inventions that Promote Change

  • Thomas Edison – inventor – 1084 patents – light bulb/electricity. Phonograph (voice recorder). Motion picture camera. He will utilize the factory system of mass production. GE(General Electric)

  • Alexander Graham Belle – telephone (communications)

  • Christopher Sholes – typewriter

III. Railroads

  • By 1890, USA has 180,000 miles of track

  • RR are dramatized (power, speed, opportunity/jobs, see the world, adventure)

  • BUT…..dangerous to build. 1888 – 2000 killed and 20000 are injured (heat, disease, accidents, Indians)

  • Time is altered that leads to time zones. 24 time zones world wide.

IV: Opportunists vs Opportunity

  • With RR track linking towns and cities this increases trade and dependence. Towns are growing because they specialize in certain industries.

  • Company towns – railroad barons (George Pullman) will build towns just to support their railroad workers. Owners force their workers to buy from Their stores, see their doctors, live on their land. MONOPOLY. High prices. High Rents. Company control is strong

  • Credit Mobilier Scandal – A construction company receives a government bid to build a railroad. Credit Mobilier bid 3 times what the lower bid was and won. After they won the bid they gave 20 Congressman stock in their company. CORRUPTION!!!. Company makes 23 million bucks!!!!! Newspapers expose this deal. Republican Party and Pres. Grant’s image greatly tarnished.

V. Grange vs the Railroads

  • Grange (united farmers) very alarmed at Credit Mobilier Scandal. Demands the government control the railroad industry.

  • Grange accuses the railroad companies of working together to keep the prices high.

  • Grange (united farmers) gets politicians elected and their goal is to regulate the railroads. (Grange Laws). Railroads sue. Saying that the government has no right to interfere in business. Supreme Court Case Mullins vs. Illinois establishes that the government CAN interfere in business in the name of the public interest. Railroads do everything possible to resist this law.

VI. Andrew Carnegie

  • Carnegie begins his business ventures buying stock in rail companies. Starts Carnegie Steel Company in 1899. He uses both vertical and horizontal integration.

      • Vertical (buying up your suppliers: coal, iron, rail, etc)

      • Horizontal (merging or destroying competition).

Very quickly Carnegie controls all of the USA’s steel production. Monopoly.

He does try to make things cheap and affordable.

He does hire talented people.

Gives 90% of his wealth to charities.
VII. Social Darwinism

  • The belief that the strongest will survive while the weak will perish

  • The talented, hard working, righteous, educated, rich will survive while the lazy, uncivilized, ignorant, sinful, poor will perish.

  • Racism

  • Many people are going to think that this is the reason why people are rich or poor.

VIII. Big Business – Rockefeller

  • Big Business sets up holding companies. Holding Companies sole purpose is buy good stocks from other companies. The rich get richer. The first modern corporation is formed.

  • John D. Rockefeller establishes Standard Oil. He uses Carnegie’s business methods. He allows other companies to exist, but he owns all of their stock. Soon Rockefeller controls all of the nation’s oil.

  • Rockefeller pays horrible wages. Keeps his prices low until the competition goes under. Then he hikes up the price.

  • Rockefeller gives away 500 million dollars.

  • Congress is alarmed at the lack of competition in steel and oil. Alarmed at their high/unfair prices. Congress passes the Sherman Anti-Trust Act which makes it illegal to form monopolies and holding companies. Very, very, very ineffective.

  • 90% of all stock is owned by Northern businesses. South is still locked in agriculture/economic stagnation (not growing).

IX. Emergence of Labor Unions

  • Laborers must band together to improve their existence in the face of power business (Carnegie, Rockefeller)

  • No vacations, no sick leave, no unemployment help, workers comp, safe/clean worker conditions, low wages.

  • Wives and kids must work to help the family survive. Rise of the sweatshop.

      • Kids work 14 HRS for 27 ¢

      • Women – year 267.00

      • Men – year 468.00

      • Andrew Carnegie – year 23 million

  • Early labor unions were very anti-women and anti-black

  • Unions of different skills/trades make different unions.

  • American Federation of Labor – attempts to get all unions to work together for rights and gains. AF of L led by Samuel Gompers. He gets unions to concentrate on collective bargaining (written lawful contract). The AF of L organizes strikes. Very effective. Politicians must listen to them. Skilled labor unions are the most effective. Unskilled laborers not so much. Ideas of socialism (Karl Marx) emerge

X. Strikes Turn Violent

  • 1877 – Railroad workers go on strike. Forcibly broken up by the FEDS. Arrests.

  • 1886 – Chicago Haymarket Square – a striker throws a bomb into a police line. Police open fire. Dozens killed.

  • 1892 – Pennsylvania steel workers broken up by company’s strikebreakers. Dozens killed

  • 1893 – Pullman RR strike is violently broken up by the FEDS

  • Mother Jones leads a strike of children. The point is to bring attention to the child labor problem in America.

  • Improvement in labor conditions comes very very very slowly in this country.

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