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Industrialization and Corporate Consolidation

Industrialization and Corporate Consolidation. Industrial Growth in America - Reasons. Natural Resources – coal, oil, iron Immigration – steady flow both Asia and Europe Capitalist mentality supported by laissez faire government

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Industrialization and Corporate Consolidation

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  1. Industrialization and Corporate Consolidation

  2. Industrial Growth in America - Reasons • Natural Resources – coal, oil, iron • Immigration – steady flow both Asia and Europe • Capitalist mentality supported by laissez faire government • Ingenuity – 440,000 patents in 1800s – inventions – Edison’s invention factory

  3. The Telephone

  4. The Light Bulb

  5. Steel Beam Girders

  6. The Electric Trolley

  7. The Typewriter

  8. Railroads • 1865 – 35,000 Miles • 1900 – 200,000 miles • Land claiming – railroad companies given land claims – size of Texas • Success of town based on railroad stop – no railroad = “ghost town” • Transcontinental – Leland Stanford Union Pacific meets Central Pacific

  9. The Golden Spike Ceremony: Utah, May 10,1869

  10. Corruption • money from government not used appropriately – Credit Mobilier • Abuse of Chinese and other immigrant labor • Faulty tracks just to make a dime • Improvements – steel – safer/stronger – standardized size – standardized time • “Stock watering” – make stock in railroads look better than it is – bribed judges

  11. Steel • Andrew Carnegie – monopolized then gave away $450 million by death • America producing 1/3 of world’s steel thanks to Bessemer Process • Carnegie - $1.4 billion more than US worth in 1800 • “Vertical” Consolidation

  12. Oil • Rockefeller – kerosene first pushed – then automobile • Vertical Consolidation – own supply and distribution • Horizontal Consolidation - 95% of oil refineries • Rockefeller – uses illegal rebates and spies to control industry

  13. Laissez Faire Conservatism • government policy in late 19th century • industry controls gov’t • Gospel of Wealth – Lord gave money to wealthy class – must be morally responsible • Social Darwinism – wealthy deserve it – inherently better • Poor by own shortcomings –poor deserve it

  14. Effects on worker • Business becomes depersonalized – feel like merely a cog in a machine – hurts creativity • Free enterprise/farming replaced by corporation • Factory controls life – whistle and artificial discipline – become subservient • Gibson Girl – advertising campaign encourages women to work in offices • 2/3 dependent on wage – unemployment not based on effort, but larger economic issues

  15. Picketing for the 8 Hour Work Day

  16. The Gibson Girl

  17. Union Movement • Manual laborers vulnerable – employers can always bring in cheaper immigrant labor • Machines displace workers • Corporations make labor organization impossible • Control legal process – best lawyers, politicians corrupt • employs “scabs”/strike breakers – “I can hire one half to kill the other half • Force workers to take ironclad oath – won’t join a union • Create company town – employees in debt to company stores

  18. Labor Unions • Knights of Labor – replaced National Labor Union – began as a secret society • Open to everyone – regardless of gender/race • Overzealous – talked about social reform/changing society – goals too unrealistic • Haymarket Square – Chicago – dynamite injures cops – anarchists linked to unions • Leads to massive riot – destroys reputation of Knights of Labor • American Federation of Labor – Samuel Gompers – “bread and butter” unionism • More realistic – wages, hours, working conditions • Used walkout and boycott to get way • by 1900 view of labor starts to change – not seen as chaos starters

  19. Industrialization Judgment • Were capitalists “Captains of Industry” or “Robber Barons?” • Class tension never as big a deal in America as in Europe • Creates belief in upward mobility • But…destroyed traditional farmer’s values/spiritual lives for capitalism • Two classes resulted – owners of labor class and the labor class

  20. Questions to Consider • What were the costs and benefits of the industrial transformation of the post-Civil War era? • Should industrialists like Vanderbilt, Carnegie, and Rockefeller be viewed as robber barons or captains of industry? • Was the growing class division of the time a threat to American democracy? Why or why not? • Why did American workers have such trouble responding to the new industrial conditions of labor? Why were business and the middle-class public generally hostile to allowing workers to organize as industry did? Why did the AF of L survive while the Knights of Labor failed? • Does the government regulation of the economy disprove the belief that capitalism is a morally superior economic theory? Why or why not?

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