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Gilded Age Industrialization. During the Gilded Age, American businesses were transformed: Massive corporations replaced small, family businesses New technology, transportation, marketing, labor relations, & efficient mass-production
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Gilded Age Industrialization • During the Gilded Age, American businesses were transformed: • Massive corporations replaced small, family businesses • New technology, transportation, marketing, labor relations, & efficient mass-production • By1900,theU.S.wasthemost industrializedcountryintheworld
The Business of Invention • 19th-century inventors led to an “Age of Invention”: • Cyrus Field’s telegraph cable • Business typewriters, cash registers, adding machines • High-speed textile spindles, auto looms, sewing machines • GeorgeEastman’sKodakcamera • Alexander G. Bell’s telephone By 1905, 10 million Americans had phones; (Bell Telephone Co became AT&T)
The Business of Invention • Thomas Edison, the “Wizard of Menlo Park,” created the 1st research lab in New York • Edison Illuminating Co was the to 1st use electric light in 1882 • Tesla’s alternating current (AC) allowed electricity to travel over longer distances & to power streetcars & factories
The Business of Invention • New technologies allowed for increased industrial production • Newmachineswereincorporated into the first assembly lines which allowed for continuous & faster production of goods • The railroad linked every region of America & allowed for a mass consumption of goods
The Midwest Made Meat for America A new-and-improved “market revolution”:More regional specialization made mass production & mass consumption possible
New Methods of Marketing • Marketing became a “science”: • Advertising firms boomed • Department stores like Macy’s & Marshall Field’s allowed customers to browse & buy • Chain stores like A&P Grocery & Woolworth’s “Five & Ten” • Mail-order catalogues, like Montgomery Ward sold to all parts of America
New Forms of Business Organization “Trusts” use a board of trustees to manage a company “Holding companies” oversee & manage other subsidiary companies • Newtypesofbusinessorganization were used to increase profits: • “Trusts” & “holding companies” integrated various businesses under 1 board of directors • Vertical & horizontal integration maximized corporate profits • Frederick Taylor’s “scientific management” emphasized time efficiency & mid-level managers
U. S. Corporate Mergers Vertical & Horizontal Integration By 1900, 1% of U.S. companies controlled 33% of all industry
New Forms of Business Organization • Business leaders used a variety of ideas to justify their wealth: • The “Gospel of Wealth” argued that it is God's will that some men attained great wealth • Social Darwinism taught that natural competition weeds out the weak & the strong survive • Were monopolists “captains of industry” or “robber barons”?
The Second Industrial Revolution was fueled by 3 industries: railroads, steel, & oil
The Railroad Industry Cornelius “the Commodore” Vanderbilt was the most powerful figure in the railroad industry • America’s first “big business” was the railroad industry: • Railroads stimulated the coal, petroleum,& iron/steel industries • Large companies bought small railroads, standardized gauges & schedules, & pooled cars • Small lines in the east acted as tributaries to the 4 great trunk lines into the West
Problems of Growth Speculators like Jay Gould built & bought rail lines to profit with little concern for efficient use • But, the railroad industry faced problems due to overbuilding in the 1870s & 1880s: • Mass competition among RRs • RR lines offered special rates & rebates (secret discounts) to lure passengers & freight on their lines • Pooling & consolidation failed to help over-speculation
Problems of Growth • RR bosses asked bank financier J.P. Morgan to save their industry: • Morgan created a traffic-sharing plan to end wasteful competition • “Morganization” fixed costs, cut debt, stabilized rates, issued new stock, & ended rebates • Created a “board of trustees” • By 1900, 7 giant (centralized & efficient) rail systems dominated
The Steel Industry • Steel transformed world industry: • Allowed for taller buildings, longer bridges, stronger railroad lines, & heavier machinery • Andrew Carnegie’s company made more steel than England • Carnegie converted his steel plants to the Bessemer process & was able to out-produce his competition & offer lower prices Andrew Carnegiewas the great example of the “American Dream” & social mobility
International Steel Production, 1880-1914 The U.S. was ideal for steel production because it had lots of coal, iron, & railroads
Rockefeller and Oil • Petroleum also changed industry • New industrial machines needed kerosene for lighting & lubricants • JohnD.Rockefellermonopolized the oil industry, lowered oil costs & improved the quality of oil • By 1879, Standard Oil ruled 90% of all U.S. oil & sold to Asia, Africa, & South America
Industrial Workers • Industrial work was hard: • Laborers worked long hours & received low wages but had expensive living costs • Industrial work was unskilled, dangerous, & monotonous • Gender,religious,&racialbiases led to different pay scales • These conditions led to a small, but significant union movement
Early American Labor Unions • In 1868, Knights of Labor formed to help all type of workers escape the “wage system” • The most successful union, the American Federation of Labor (1886) led by Samuel Gompers: • Made up only of skilled labor & sought practical objectives (better pay, hours, conditions) • Included 1/3 of all U.S. laborers Membership regardless of skill, race, or sex The KoL lacked organization to survive Excluded women, blacks, unskilled laborers
The U.S. experienced an “era of strikes” from 1870-1890 The Great RR Strike of 1877 shut down railroads from WV to CA & resulted in hundreds of deaths During the Chicago Haymarket Strike (1886), unionists demanded an 8-hr day; led to mob violence & the death of the Knights of Labor The Homestead Strike (1892) resulted from a 20% pay cut at one of Carnegie’s steel plants
Gilded Age Urbanization • From 1870 to 1900, American cities grew 700% due to new job opportunities in factories: • European, Latin American, & Asianimmigrantsfloodedcities • Blacks migrated into the North • Rural farmers moved from the countryside to cities
The Lure of the City By 1920, for the 1st time in U.S. history, more than 50% of the American population lived in cities
Skyscrapers and Suburbs • By the 1880s, steel allowed cities to build skyscrapers • The Chicago fire of 1871 allowed for rebuilding with new designs: • John Root & Louis Sullivan were the “fathers of modern urban architecture” • New York & other cities used Chicago as their model
Louis Sullivan “Form follows function” John Root “Simple & Dignified”
Skyscrapers and Suburbs • Cities developed distinct zones: • Central business district with working- & upper-class residents • Middle-class in the suburbs • Electric streetcars & elevated rapid transit made travel easy
Tenements & Overcrowding • ½ of NYC’s buildings were tenements which housed the poor working class • “Dumbbell” tenements were popular but were cramped & plagued by firetraps • Slums had poor sanitation, polluted water & air, tuberculosis • Homicide, suicide, & alcoholism rates all increased in U.S. cities
Jacob Riis’ “How the Other Half Lives” (1890) exposed the poverty of the urban poor
Strangers in a New Land • From 1880-1920, 23 million immigrants came looking for jobs: • These “new” immigrants were from eastern & southern Europe; Catholics & Jews, not Protestant • Kept their language & religion; created ethnic newspapers, schools, & social associations • Led to a resurgence in Nativism & attempts to limit immigration
Foreign-born Population, 1890 The influx of ethnic nationalities led to a new “melting pot” (“salad bowl”?) national image
Urban Political Machines • Urban “political machines” were loose networks of party precinct captains led by a “boss” • Tammany Hall was the most famous machine; Boss Tweed led the corrupt “Tweed Ring” • Political machines were not all corrupt (“honest graft”); helped the urban poor & built public works like the Brooklyn Bridge
Boss Tweed Tweed Courthouse—NY CountyCourthouse was supposed to cost $250,000 but cost $13 million. But the Tweed Ring catered to immigrants by building the Brooklyn Bridge & hosting holiday barbeques
Social Changes in the Gilded Age Women made up 40% of university students Private philanthropy led to Stanford, Tulane, Vanderbilt, Cornell, & the Univ of Chicago • Urbanization changed society: • The U.S. saw an increase in self-sufficient female workers • Most states had compulsory education laws & kindergartens • 150 new public & private colleges were formed • Cities set aside land for parks & American workers found time for vaudeville & baseball Land Grant Act (1862) led to the Universities of WI, CA, MN, IL “Family time” disappeared for working class People of all races married later & had fewer children
American Industrialization • Benefits of rapid industrialization: • The U.S. became the world’s #1 industrial power • Per capita wealth doubled • Improving standard of living • Human cost of industrialization: • Exploitation of workers; growing gap between rich & poor • Rise of giant monopolies