industry comes of age 1865 - 1900. an empire of rails at the end of the civil war the u.s. had...
TRANSCRIPT
An Empire of RailsAn Empire of RailsAt the end of the Civil
War the U.S. had 35,000 miles of railroad east of the Mississippi River
Mostly localized & built to protect local commerce
By 1900: 192,256 miles of track – more than all of Europe combined
Much of the new construction was west of the Mississippi
1841 - 1850
1851 - 1860
1861 - 1870
1871 - 1880
1881 - 1890
1891 - 1900
1901 - 1910
1911 - 1920
0 10,000 20,000 30,000 40,000 50,000 60,000 70,000 80,000
Railroad Construction 1830 - 1920
Expansion of Railroads•1869, 30,000 miles of track•1900, 200,000 miles of track•Distribution System to the marketplace•Symbol of growth
Civil War showed the value of long distance transportationEnded the debate between North & South over construction
Pacific Railway Act (1862)Congress authorizes the construction of the first transcontinental railway
The Union Pacific will build west from Omaha, Nebraska & the Central Pacific will build east from Sacramento, California
1863: Construction beginsMeet at Promontory Point, Utah, May 10, 1869
Significance:Linked continentStimulated western growth & Far East trade
Monumental achievement
Federal government, citing military & postal needs, funds the railroads through Land Grants & subsidies
Land is granted to Railroads at 20 square miles (640 acres) either side of rails in alternate sections (checkerboard)155,000,000 acres given to railroads
Millions of dollars received in loans from federal & state gov’t
Funding gives rise to Credit Mobilier Scandal
The “Big Four”Leland Stanford, Collis Huntington, Charles Crocker, & Mark Hopkins
Built the Central Pacific railroad were never shown to be involved in scandal
Union Pacific built by many Irish immigrants (“paddies”)
Central Pacific built by many Chinese immigrants (“coolies”)
Four other Transcontinental Railroads built in 1800's
1883: Northern Pacific - Duluth, MN to Tacoma, WA
1884: Atchison, Topeka & Santa Fe = Kansas - San Francisco
1884: Southern Pacific - New Orleans to Los Angeles
1893: Great Northern - Duluth to Seattle by James G. Hill (best)
New TechnologiesNew TechnologiesBessemer steel
railsSafer & more
economicalCornelius
Vanderbilt replaces NY Central's iron rails
Cornelius VanderbiltCornelius Vanderbilt
“Law! What do I care about the
Law? Hain’t I got the
power?”
“Law! What do I care about the
Law? Hain’t I got the
power?”
Standard gauge of 4' 8½" rail increases efficiency
Air brakes & couplers increased safety
Refrigerator cars increased profits
Pullman Palace cars made traveling more comfortable
Telegraph, double tracking, block signals, & switches increase safety
Passengers have to change their clocks some 20 times in making a transcontinental tripGeneral Time Convention created in 1883, creating four standard time zones
Mandated by the federal Standard Time Act of 1918
The “Robber Barons”The “Robber Barons”Enormous profits lead to
corruption & greed Jay Gould, financier
Stock watering & other shady financial practices to inflate the value of stock to cheat out greater profits
Rate wars & control of routesCharge more for shorter routes
Offer special rates to big shippers
Use rebates = secret reductions for certain customers
Inability of competitors to cooperate & results of huge debts led to the formation of “Pools”Agreements to share profits in areas
Many railroads collapsed in the Panic of 1893Led to takeover by bankersJ.P. Morgan & a few others took over the railroad industry Eliminated "wasteful competition"
Government RegulationsGovernment RegulationsSome state legislatures,
under pressure from farm groups such as the Grange, began to try to regulate the railroad monopolies
Wabash v. Illinois (1886)Supreme Court decided that a state has no power to control interstate commerce within its own bordersOverturned Munn v. Illinois (“Granger Laws”)
Interstate Commerce Act (1887)Interstate Commerce Act (1887)Prohibited rebates &
pools, & forces railroads to publish all rates
Created the 5 man Interstate Commerce Commission
Does not act to give strong government control over business, but does set a precedent of government regulation
How and why did How and why did transportation transportation developments spark developments spark economic growth during economic growth during the period of 1860-1900 in the period of 1860-1900 in the United States?the United States?
Quickwrite
At the start of the Civil War the US lagged behind the European industrial nations Germany, France, Great Britain
By 1900, US had vaulted into the lead, with a manufacturing output that exceeded the combined output of its three European rivals
2. Government supported transportation network
3. Abundant source of cheap labor - native & immigrant
4. Massive internal market - largest free-trade market in the world
5. Government stability & the use of power to protect business through tariffs, but not to regulate
Encouraged foreign & domestic investors
6. Technological progress & invention
1876: Alexander Graham Bell developed telephone
Thomas Edison developed electric light, phonograph, moving pictures, etc.
1790s 276 patents issued. 1990s 1,119,220 patents issued.
Gave an inventor the right to make and sell an invention.
1790s 276 patents issued. 1990s 1,119,220 patents issued.
Gave an inventor the right to make and sell an invention.
Rise of the Industrialists “nouveau riche”Social Darwinism
Herbert Spencer’s idea“Millionaires a product of natural selection.”
Divine Providence“Acres of Diamonds”
lectures
Andrew Carnegie (1835 - 1919)
Sold railroad bonds to build Bessemer process steel plant in Pittsburgh in 1872
1880's converted the Homestead Steel plant to making steel beams for "Sullivan" skyscrapers
Making $40 million a year by 1900 - largest industrial company in the world
Vertical integration Control all stages of development in production process
Improve efficiencyEliminate middleman fees
The Gospel of WealthHis wealth was given to him in "trust“
Through his superior administrative abilities he should wisely give back to the community & "help those who would help themselves"
Involved in government financing during Civil War
1880's involved in financing railroads
1880-1900: bought out & reorganized failing railroads
1895: formed a syndicate to bail out the U.S. Treasury during gold depletion crisis after "Crash of 1893"
Created "interlocking directorates" out of failed companies in the '90sHeld controlling stock interests in companies instead of buying them outright
1901: bought Carnegie Steel
Enlarged his steel holdings to create United States Steel - the first billion dollar corporation
Morgan had controlling interests in railroads, marine operations, steel, International Harvester, General Electric, American Telephone & Telegraph72 different directorships
John D. Rockefeller (1839 - 1937)
1859: Edwin Drake drills oil well near Titusville, Pennsylvania ("Drakes Folly“)Uses soon found for petroleum
1862: Rockefeller sent by investors to investigate the uses of oil found in OhioHe reports "no use" & invests heavily
1863: at 24 he begins oil business in Cleveland, Ohio
1870: incorporates the Standard Oil Company of Ohio
Standard Oil used vertical integration to be more efficient
Began process of Horizontal Integration to destroy or control all competition
Coke fields
purchased by
Carnegie
Coke fields
Iron ore deposits
purchased by
Carnegie
purchased by
Carnegie
Coke fields
Iron ore deposits
Steel mills
purchased by
Carnegie
purchased by
Carnegie
purchased by
Carnegie
Coke fields
Iron ore deposits
Steel mills
Ships
purchased by
Carnegie
purchased by
Carnegie
purchased by
Carnegie
purchased by
Carnegie
Coke fields
Iron ore deposits
Steel mills
Ships
Railroads
purchased by
Carnegie
purchased by
Carnegie
purchased by
Carnegie
purchased by
Carnegie
purchased by
Carnegie
Vertical IntegrationVertical Integration You control all phases of production from the raw material to the finished
product
Horizontal IntegrationHorizontal Integration Buy out your competition until you have control of a
single area of industry
1882: created the Standard Oil Trust9 trustees given power "to hold, control, & manage" all of Standard Oils vast holdings
Led to trusts by tobacco, sugar, whiskey, lead, etc.
Also led to movement of "trust busting" & anti-trust legislation
The ‘Bosses’ of the SenateThe ‘Bosses’ of the SenateThe ‘Bosses’ of the SenateThe ‘Bosses’ of the Senate
““Robber Barons”Robber Barons” Business leaders built
their fortunes by stealing from the public.
They drained the country of its natural resources.
They persuaded public officials to interpret laws in their favor.
They ruthlessly drove their competitors to ruin.
They paid their workers meager wages and forced them to toil under dangerous and unhealthful conditions.
““Captains of Industry”Captains of Industry” The business leaders served
their nation in a positive way. They increased the supply of
goods by building factories. They raised productivity and
expanded markets. They created jobs that
enabled many Americans to buy new goods and raise their standard of living.
They also created museums, libraries, and universities, many of which still serve the public today.
Anti-Trust LegislationSherman Anti-Trust Act
(1890)Outlawed any organization that acted “in restraint of trade”
Federal government move to regulate interlocking directorates, pools, & trusts
Law lacked teeth, but ironically used to attack labor unions
The New SouthSouth remained mostly
agrarianTextile plants were built
to take advantage of cheap labor
Steel production was checked by preferential rates for northern goods
Effects of IndustryWomen found new jobs
as stenographers & “hello girls” while leaving the factories
Wealthy displayed conspicuous consumption leading to class struggle
Weakness of LaborUnskilled labor had little
power & wages were lowEmployers had the power
to break labor unionsYellow dog contracts, iron-clad oaths, black lists, scabs, lockouts, company stores, troop, starvation...
Rise of Labor Unions1866: The National
Labor Union is formed 600,000 members both skilled & unskilled
Called for social reform
Won the 8 hour day for government workers but no means of enforcing
Killed by the depression of the 1870’s
Molly Maguires (1875)Irish coal minersUsed violence to protest1877: became martyrs for labor movement
Great Railroad Strike1877: 1st nationwide strikeHayes sent federal troops
The Knights of Labor (1869)Led by Terence PowderlyAll workers in one big unionEconomic & social reform
without politics
Knights of LaborKnights of Labor
Terence V. PowderlyTerence V. Powderly
An injury An injury to one is to one is
the the concern concern of all!of all!
Goals of the Knights of LaborGoals of the Knights of Labor Eight-hour workday.Eight-hour workday.
Workers’ cooperatives.Workers’ cooperatives.
Worker-owned factories.Worker-owned factories.
Abolition of child and prison labor.Abolition of child and prison labor.
Increased circulation of greenbacks.Increased circulation of greenbacks.
Equal pay for men and women.Equal pay for men and women.
Safety codes in the workplace.Safety codes in the workplace.
Prohibition of contract foreign labor.Prohibition of contract foreign labor.
Abolition of the National Bank.Abolition of the National Bank.
Haymarket Square (1886)Bloody explosion in Chicago led to conviction of 8 Anarchists
Governor Altgeld later pardoned all survivors
Bad feelings led to the weakening of the Knights
American Federation of Labor (1886)
AFL founded & led by Samuel Gompers
Anti-socialist & simply wanted more for labor (“bread & butter” issues)
Excluded unskilled workers
Wanted the “Closed Shop”
Avoiding politics & staying united helped the AFL grow to the largest labor organization
How the AFL Would Help WorkersHow the AFL Would Help Workers Catered to the skilled worker.Catered to the skilled worker.
Represented workers in matters of national Represented workers in matters of national legislation.legislation.
Maintained a national strike fund.Maintained a national strike fund.
Evangelized the cause of unionism.Evangelized the cause of unionism.
Prevented disputes among the many craft Prevented disputes among the many craft unions.unions.
Mediated disputes between management Mediated disputes between management and labor.and labor.
Pushed for Pushed for closed shopsclosed shops..
“The Tournament of Today: A Set-to Between Labor and Monopoly”
“The Tournament of Today: A Set-to Between Labor and Monopoly”
Major StrikesHomestead Strike (1892)
Stronger employer (Carnegie) could break a union with private police force & gov’t help
Homestead Strike (1892)Homestead Strike (1892)
The Amalgamated The Amalgamated Association of Association of
Iron & Steel WorkersIron & Steel Workers
Homestead Steel WorksHomestead Steel Works
Eugene V. Debs & American Railway Union
Federal troops sent in with Cleveland’s approval to put down strike
The Pullman Strike of 1894The Pullman Strike of 1894
Government by injunction!Government by injunction!
President Grover ClevelandPresident Grover Cleveland
If it takes the entire army and navy to If it takes the entire army and navy to deliver a postal card in Chicago, that card deliver a postal card in Chicago, that card
will be delivered!will be delivered!
Impacts of the 2nd IRStandard of living roseUrban centers grewIndustry eclipsed
agricultureMonopoly over free-
enterprise
The The Changing Changing American American
Labor Labor ForceForce
The The Changing Changing American American
Labor Labor ForceForce