Industrial RevolutionIndustrial Revolution

InventionsInventions

• Edwin DrakeEdwin Drake: proved that oil could be : proved that oil could be extracted from the ground through a well, extracted from the ground through a well, used steam engine to drill holeused steam engine to drill hole

• Bessemer Steel Process: Bessemer Steel Process: easier and easier and cheaper way to remove impurities for cheaper way to remove impurities for making steel, made possible mass making steel, made possible mass production of steelproduction of steel

• Uses for steelUses for steel: railroads, barbed wire, : railroads, barbed wire, farm machineryfarm machinery

InventionsInventions

• Thomas EdisonThomas Edison: light bulb, : light bulb, phonographphonograph

• Samuel MorseSamuel Morse: telegraph: telegraph

• George WestinghouseGeorge Westinghouse: airbrakes, : airbrakes, electricity safer and less expensiveelectricity safer and less expensive

• Fredrick TaylorFredrick Taylor: published : published The The Principles of Scientific ManagementPrinciples of Scientific Management

• Henry FordHenry Ford: assembly line: assembly line

InventionsInventions

• Christopher SolesChristopher Soles: typewriter: typewriter

• Alexander Graham BellAlexander Graham Bell: telephone: telephone

Benefits of ElectricityBenefits of Electricity

• Travel cheap- outward expansion of Travel cheap- outward expansion of citiescities

• Manufactures could locate Manufactures could locate businesses where ever they chosebusinesses where ever they chose

Benefits of InventionsBenefits of Inventions

• Women: new jobsWomen: new jobs

• Workers: realized they were easily Workers: realized they were easily replaceablereplaceable

• Increased productivity = cheaper Increased productivity = cheaper goodsgoods

• Employ fewer peopleEmploy fewer people

• Improved standards of livingImproved standards of living

RailroadsRailroads

• Central Pacific Central Pacific RailroadsRailroads

• Eastward out of Eastward out of SacramentoSacramento

• Employed Chinese Employed Chinese immigrantsimmigrants

• Pd $35 per month; Pd $35 per month; provide own mealsprovide own meals

• Union Pacific Union Pacific RailroadsRailroads

• Toward WestToward West

• Employed Irish Employed Irish immigrantsimmigrants

• b/c white paid more b/c white paid more ($40-$60 per month)($40-$60 per month)

RailroadsRailroads

• Formation of new citiesFormation of new cities• Began to specialize in one productBegan to specialize in one product• George PullmanGeorge Pullman: built factory for : built factory for

manufacturing sleepers, built a town manufacturing sleepers, built a town for employers to live in, under for employers to live in, under company’s control; hoped it would company’s control; hoped it would ensure a positive workplace; refused ensure a positive workplace; refused to lower rent after cutting wages- led to lower rent after cutting wages- led to violent striketo violent strike

Credit MobilierCredit Mobilier

• Formed by Union Pacific RailroadFormed by Union Pacific Railroad

• Stockholders gave company contract to lay Stockholders gave company contract to lay track 2-3 times the actual cost track 2-3 times the actual cost

• Pocketed the profitsPocketed the profits

• Donated shares to representativesDonated shares to representatives

• Congressional investigation found that Congressional investigation found that investors had taken up $23 million in stocksinvestors had taken up $23 million in stocks

• Tarnished reputation of Republican partyTarnished reputation of Republican party

RailroadsRailroads• Corruption: charging different people different Corruption: charging different people different

pricesprices• Granger LawsGranger Laws: establish maximum freight and : establish maximum freight and

passenger rates, prohibit discriminationpassenger rates, prohibit discrimination• Munn v IllinoisMunn v Illinois: states won right to regulate : states won right to regulate

railroads for the benefits of farmers and railroads for the benefits of farmers and consumers and fed govt right to regulate consumers and fed govt right to regulate private industry to serve the public interestprivate industry to serve the public interest

• Interstate Commerce ActInterstate Commerce Act: reestablished the : reestablished the right of the federal govt to supervise railroad right of the federal govt to supervise railroad activities and established a five member panel activities and established a five member panel (ICC)(ICC)

• Panic of 1893Panic of 1893: railroads having financial : railroads having financial problems, taken over by banks, Morgan and problems, taken over by banks, Morgan and Vanderbilt began to seize RRVanderbilt began to seize RR

Big BusinessBig Business

• Corporations: company that is Corporations: company that is recognized by law as existing recognized by law as existing independently from its owners; people independently from its owners; people buy stock; most they could lose is buy stock; most they could lose is amount of stockamount of stock

• CapitalismCapitalism: economic system in which : economic system in which means of production are privately means of production are privately owned rather than being controlled by owned rather than being controlled by govtgovt

Andrew CarnegieAndrew Carnegie

• Founded 1Founded 1stst steel plants to use steel plants to use Bessemer process in PittsburgBessemer process in Pittsburg

• Make better products, cheaperMake better products, cheaper• Cut prices to drive competitors out of Cut prices to drive competitors out of

businessbusiness• People should be free to make as People should be free to make as

much money as possible as long as much money as possible as long as they give it awaythey give it away

Business StrategiesBusiness Strategies• Vertical integration: buying out suppliers; Vertical integration: buying out suppliers;

controlling each stepcontrolling each step

• Horizontal integration: buy out competition; Horizontal integration: buy out competition; monopolize industrymonopolize industry

• Laissez-faire: (allow to do) market place Laissez-faire: (allow to do) market place should not be regulatedshould not be regulated

• Social Darwinism: “natural selection” Social Darwinism: “natural selection” survival of the fittest; govt should not survival of the fittest; govt should not intervene in businessintervene in business

• Monopoly: dominating a particular industry Monopoly: dominating a particular industry (Rockefeller’s Standard Oil); complete (Rockefeller’s Standard Oil); complete control over industry’s production, wages control over industry’s production, wages paid, quality, prices chargedpaid, quality, prices charged

John D. RockefellerJohn D. Rockefeller• Used trusts: set of companies that Used trusts: set of companies that

are managed by a small group are managed by a small group known as trustees. A method of known as trustees. A method of consolidating competing companies consolidating competing companies in which participants turn their stock in which participants turn their stock over to a board of trusteesover to a board of trustees

• Owned Standard Oil Co.; controlled Owned Standard Oil Co.; controlled 90% of refining business90% of refining business

• Pd employers low wage; sold oil at Pd employers low wage; sold oil at extremely low rates; once control of extremely low rates; once control of market raised pricesmarket raised prices

Robber Barons & Captains of Robber Barons & Captains of IndustryIndustry

• Robber Barons: business leaders who Robber Barons: business leaders who built their fortunes by stealing from built their fortunes by stealing from the public; drained country of natural the public; drained country of natural resources, employees underpaid, resources, employees underpaid, poor working conditionspoor working conditions

• Captains of Industry: served the Captains of Industry: served the nation in a positive way; increasing nation in a positive way; increasing supply of goodssupply of goods

Sherman Anti-trust ActSherman Anti-trust Act

illegal to form a trust that interfered illegal to form a trust that interfered with free trade between states or with free trade between states or with other countrieswith other countries

Didn’t define what a trust was, hard to Didn’t define what a trust was, hard to prosecute companiesprosecute companies

WorkersWorkers

• Hazardous tasks, monotony, no vaca, Hazardous tasks, monotony, no vaca, sick leave, unemployment sick leave, unemployment compensationcompensation

• Wages so low everyone in family had to Wages so low everyone in family had to workwork

• Child labor: didn’t have to pay as much, Child labor: didn’t have to pay as much, most dangerous working conditionsmost dangerous working conditions

• Living conditions: lived in slums, Living conditions: lived in slums, tenements tenements

Labor UnionsLabor Unions• Groups of workers joined together to Groups of workers joined together to

improve conditions (higher wages, shorter improve conditions (higher wages, shorter hours, better working conditions) hours, better working conditions)

• Power from threat of strikesPower from threat of strikes• National Labor Union: passage of 8 hour National Labor Union: passage of 8 hour

workdayworkday• Noble Order of the Knights of Labor: open Noble Order of the Knights of Labor: open

to all, used arbitration instead of strikesto all, used arbitration instead of strikes• American Federation of Labor: skilled American Federation of Labor: skilled

workers, Samuel Gompers president, workers, Samuel Gompers president, collective bargaining, used strikes, won collective bargaining, used strikes, won higher wages, shorter weekshigher wages, shorter weeks

• American Railway Union: Eugene Debs American Railway Union: Eugene Debs founderfounder

SocialismSocialism

• Believed rich getting richer, poor Believed rich getting richer, poor getting poorer turned to socialismgetting poorer turned to socialism

• Economic and political system based Economic and political system based on govt control of business and on govt control of business and property and equal distribution of property and equal distribution of wealthwealth

• Communism: extreme form, classless Communism: extreme form, classless societysociety

• Industrial Workers of the World: Industrial Workers of the World: formed by unskilled workersformed by unskilled workers

Violent StrikesViolent Strikes• Great Strike of 1877: B&O Railroad Great Strike of 1877: B&O Railroad

employees striking after 2employees striking after 2ndnd wage cut wage cut in 1 month, trains didn’t run for a in 1 month, trains didn’t run for a week, Hayes called in federal troops week, Hayes called in federal troops to stop striketo stop strike

• Haymarket Affair: gathered to Haymarket Affair: gathered to protest police brutality; rain lead to protest police brutality; rain lead to crowd leaving; police arrived; bomb crowd leaving; police arrived; bomb thrown @ them; 7 police officers & thrown @ them; 7 police officers & several workers died b/c of chaosseveral workers died b/c of chaos

Violent StrikesViolent Strikes• Homestead Strike: Pres of co. planned on Homestead Strike: Pres of co. planned on

cutting wages, led to strike, hired armed cutting wages, led to strike, hired armed guards to protect factory so they could guards to protect factory so they could hire scabs (strikebreakers) killed 3 det. 6 hire scabs (strikebreakers) killed 3 det. 6 workers, Penn National Guard arrivedworkers, Penn National Guard arrived

• Pullman Strike: during Depression laid off Pullman Strike: during Depression laid off 3000 employees, cut wages of rest, didn’t 3000 employees, cut wages of rest, didn’t cut cost of living, strike b/c failed to cut cost of living, strike b/c failed to restore wages, decrease rent; hired scabs, restore wages, decrease rent; hired scabs, turned violent, Cleveland sent in troops, turned violent, Cleveland sent in troops, Pullman fired most of strikers, rest Pullman fired most of strikers, rest blacklistedblacklisted