industry comes of age 1865-1900...industry comes of age 1865-1900 american pageant chapter 24 ....
TRANSCRIPT
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Industry Comes of Age 1865-1900
American Pageant Chapter 24
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Transportation
• 1865- 35,000 miles of Railroads (RR) • 1900-192,556 miles of RR • Government subsidized transcontinental RR by
granting companies large tracts of land to build on – Gave away 155,504,994 acres!
• Towns fought over who would have RR going through them – Could mean the survival of the town
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Spanning the Continent with RR’s
• Debate over North or South transcontinental RR ended when South seceded
• 1862 Union Pacific RR began construction starting in Omaha, Nebraska and running West
• RR were laid as quickly as possible after Civil War – Lots of Irishmen worked on RR – Often attacked by Indians – The Cali end began in Sacramento and ran East
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• The “Big Four” oversaw the construction and made millions – Leland Stanford, Collis P. Huntington
• Cali line built by Central Pacific RR and mostly used Chinese workers
• “Wedding of the rails” took place in 1869 in Ogden, Utah • RR tied West and East together, opened trade with Asia
and allowed more settlers to move West • Four other transcontinental RR were built by 1900
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Railroad Consolidation and Mechanization
• Cornelius Vanderbilt – Owner of New York Central Rail
– Made over $100 million
– Donated $1 million to build Vanderbilt University in Tennessee
• RR started using steel rails instead of iron – Cheaper and could hold a heavier load
• Started using the same gauge of track – Eliminated a lot of train changes for
passengers and cargo
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Revolution by Railways
• US became a national market for goods – Brought in foreign investors
• Sped up industrialization – Moved goods quickly – Demanded large amount of steel and iron
• Helped agriculture – Transported crops to markets
• Helped cause the rise of cities – Could bring in lots of supplies
• Greatly changed the environment – Corn fields planted – Buffalo hunted almost to extinction – Forests cut down for lumber
• Changed time – Until 1880’s every town had it’s own “local” time
• Nightmare for RR
– November 18, 1883 RR said continent would be split into time zones
• Made some people enormously rich
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Corruption and Greed
• Lots of corruption tied to RR business
• Jay Gould – Made millions manipulating RR
stocks
• RR owners started working together (like a cartel) to fix prices and make huge profits – Bribed officials and the press
• RR barons had massive control over people’s lives
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Government Tries to Help
• Americans did not want Govt involved in economy but by 1870’s farmers were being “railroaded” into bankruptcy
• States began to try to regulate the RR’s • Wabash supreme court case stopped that
– Only federal govt can regulate interstate commerce
• Congress passed the Interstate Commerce Act of 1887 – Required RR’s to publish rate to public – Set up the Interstate Commerce Commission (ICC) to
enforce new laws – Did some good but not a whole lot
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Miracles of Mechanization
• 1876 Alexander Graham Bell – Invented the
telephone
• Thomas A. Edison – Invented the
phonograph, moving pictures
– 1879 perfected the electric light bulb
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The Trust Titan Emerges
• Big names of the time to know – Andrew Carnegie, steel
– John D. Rockefeller, oil
– JP Morgan, banking
• All tried to avoid competition in their industries, used “vertical integration” – Carnegie Steel owned:
• Mines
• Ships
• RR’s
• Steel factory
– No one touched Carnegie steel except Carnegie employees
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• Rockefeller used “horizontal integration”, allying competitors to monopolize the market
• Formed Standard Oil Co in 1870
• Created a “trust”
– Stockholders in small oil companies assigned their stocks to Standard Oil. Standard Oil then controlled all oil companies to make the most profit for all stock holders
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Supremacy of Steel
• Steel replaced iron as the dominate metal in the late 1800’s
• 1870 Vanderbilt had to import steel from England
• 1890 US produced 1/3 of the World’s steel, why?
• Steel became cheaper to make through the Bessemer Process – Cold air blown on red-hot steel caused
the steel to become white-hot, eliminating it’s impurities and making better steel
• US had all of the natural resources to make steel and a large labor force
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Carnegie and Morgan
• Andrew Carnegie – Moved to America when he was
12 from Scotland
– Worked for $1.20 a week
– Slowly saved money and invested in steel
– Eventually became to steel maker in US
– 1900 he was producing ¼ of US steel • $25 million a year, no income tax!
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• J.P. Morgan – Top banker in US
• 1900 Carnegie was looking to sell his steel company – Morgan was just getting into steel business
• Morgan agreed to buy Carnegie out for $400 million – Carnegie spent the rest of his life as a
philanthropist, giving away ~$350 million
• Morgan expanded his steel company and created US Steel Corporation in 1901 – Worth $1.4 billion – 1st billion-dollar corporation
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Rockefeller and Oil
• Oil became big business after Civil War – Used mainly to make kerosene – 1870 kerosene was US’s 4th most valuable export
• By 1885 people were turning to electricity – Bad for oil business
• By 1900 gasoline-burning internal combustion engine developed and the century of the automobile dawned – Great for oil!
• John D Rockefeller – 1870 organized Standard Oil Co
• Turned into a trust in 1882 – By 1877 Rockefeller controlled 95% of oil refineries in US – Rockefeller was ruthless in business
• Would ruin any competitor, survival of the fittest
• Other trusts formed as well – Sugar, tobacco, leather, meat
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The Gospel of Wealth
• Some viewed themselves as chosen by God to be rich
• Others thought it was social Darwinism
• Many millionaires thought poor people were just lazy – “There is not a poor person in the US who was not made poor by his
own shortcomings.” » Rev. Russell Conwell
• Big business used the Constitution to protect themselves – Supreme Court ruled that a corporation was a “person”, thus their
property was protected by the 14th Amendment
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Government Tackles the Trust
• Sherman Anti-Trust Act of 1890 – Forbade combinations in restraint of trade
• Most corporations got around law through loopholes
• It did end up hurting labor unions though – Restricting trade?
• A step towards government restricting business
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The South in the Age of Industry
• South could not keep up with the North • Mostly sharecroppers and tenant farmers • James Buchanan Duke
– Took advantage of the new machine that rolled cigarettes in the 1880’s – 1890 absorbed his main competitors into the American Tobacco Co – Duke University named after him
• North actively worked to keep the South down – Example: Charging southerners more to ship on the RR’s
• North began building textile mills in the South – Lots of cotton, cheap un-unionized labor – Very bad conditions
• Worked dusk till dawn • Paid ½ of what Northerners were paid
– Employed lots of women and children
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The Impact of the New Industrial Revolution on America
• Standard of living rose • Immigration went up • Jeffersonian ideals of a country of small farmers gone • Women entered the workforce
– Same hours and conditions – Less money
• By 1900 1/10 of Americans were wage earners – Dependent on employers
• Foreign trade went up as US market became saturated with goods
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In Unions There is Strength
• Workers had no rights or power against the corporations – Could be easily replaced – Thousands of immigrants a year came for work
• Kept wages low
• Corporations had Federal Courts on their side – Could send in troops to break strikes
• Employers could “lockout” workers and starve them into submission • Forced people to sign “yellow-dog contracts”
– Swore not to join a labor union • You could be “blacklisted”
– No one would hire you • Many middle-class Americans were tired of hearing workers cry
– US had some of the highest wages in the world – More supportive of Big Business than the worker
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Labor Limps Along • 1869 The Knights of Labor formed
– Secret union that welcomed every workers • Women and Blacks included
– Fought for workers safety and an eight hour work day
• 1886 Chicago – Home to 80,000 Knights – Protest held in the Haymarket Square – Police moved in to stop the protest – Someone threw dynamite into the crowd
• Killed/injured dozens, including police
– Blamed on Anarchists, but Knights were associated with it
• Skilled workers began to leave the Knights – Formed the American Federation of Labor
• By 1890’s Knights had only 100,000 members
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The A.F.L.
• American Federation of Labor
– Started in 1886
• Led by Samuel Gompers
• Was made up of many independent unions
• Fought for better wages, hours, and working conditions
• Used walk-outs and boycotts
• By 1900 had 500,000 members
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Unions
• From 1881-1900 23,000 strikes took place
– Cost $450 million
• 1900 only 3% of working people were in unions
• Public started to agree with organized labor
– 1894 Congress made Labor Day a national holiday
• Still lots of fighting ahead for labor and businesses