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Ch 24 Rise of Industry

Ch 24 Rise of Industry. RRs, Industrialization, Immigration, Labor Unions. Post Civil War RR expansion. Some RR production from 1840-65 Post CW RR production skyrocketed. Congress encouraged w/ land grants totaling over 155million acres.

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Ch 24 Rise of Industry

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  1. Ch 24 Rise of Industry RRs, Industrialization, Immigration, Labor Unions

  2. Post Civil War RR expansion • Some RR production from 1840-65 • Post CW RR production skyrocketed. • Congress encouraged w/ land grants totaling over 155million acres. • Cos were allowed 10 mile wide strips of land, mapped in alternating 1 mi square sections some to keep & some to sell • Cleveland stopped practice 1887 • Towns where RR came through became sprawling cities; those skipped by RRs bcm ghost towns

  3. Transcontinental RR • When south seceded congress commissioned Union Pacific RR for the northern route • Omaha, NE to CA 1862 • Co received huge $$ grants to build but Credit Mobilier netted 23 mill in profits • Central Pacific RR in CA built eastbound route • Irish hired to lay westward route; Chinese hired to lay eastern route. • RR workers defended tracks from Indian attacks • Averaged 7-10 miles of track per day • Central Pac backed by ‘Big 4’: (with) • Leland Stanford (ex gov CA)& Collis P. Huntington (lobbyist)

  4. RRs (3) • Central Pac also had to drill through Sierra Nevadas • First Transcontinental route completed at Ogden, UT in 1869 • By 1900, 4 other Transcontinental routes built • Northern Pacific RR (Lake Superior Puget Sound) • Atchison, Topeka & Santa Fe crossed SW deserts • Southern Pacific from Orleans to SF, CA • Great Northern (Duluth to Seattle) • James J. Hill project- greatest RR builder

  5. RRs consolidate • Many pioneers over invested in land & banks that supported them often failed when land value turned out to be low • Cornelius Vanderbilt (NY Central RR) financed many western RRs • RR advances: • Steel rails (stronger than iron) • Westinghouse Air Brake • Pullman Palace Cars • Telegraphs • Double racking & block signals • Train accidents still common, many fatalities

  6. Effects of RRs • Tied nation together, created huge market & many jobs • Helped industrialize US • Stimulated mining, agriculture by bringing people, supplies • Creation of 4 time zones: Nov 18, 1883 • Stopped independent times/ scheduling nightmare • Created millionaire class

  7. RR wrong doings • Credit Mobilier • Jay Gould made millions watering stock • Embezzled from Erie, KS Pacific, Union Pacific, TX Pacific etc • Inflated worth of stocks; sold over value • Owners abused public • Bribed judges, legislatures, hired lobbyists • Elected their own to office • Used free passes as bribes w/ press • Formed defensive alliances, Trusts, then called Pools

  8. Government’s first attempts to regulate business • Gov position had always been pro business • Adam Smith: the market will regulate itself • The People attempted to regulate RRs to stop injustices through the Grange • Several state cases allowed States to intervene, as in the Wabash case • Each time, the Supreme Ct overturned; only Congress can reg. interstate commerce • Interstate Commerce Act 87- banned rebates, pools, req’d RRs to publish rates openly, banned charging more for short hauls • Set up ICC to enforce

  9. Mechanization • 1860- US: 4th largest mfctr in world • 1894: #1 • Abundant liquid capital • Exploited natural resources: coal, iron, oil • Abundant cheap labor: immigration • American ingenuity (inventions) • Mass production • Cash register, stock ticker, typewriter, refrigerator car, electric dynamo, electric railway • Bell’s telephone • Thomas Edison (wizard of Menlo Park): light bulb, phonograph & dozens more

  10. Trust Titans & Robber Barons • Andrew Carnegie (steel) • Vertical integration • Controlled all aspects of industry (from ground up) • John D. Rockefeller (oil) • Horizontal integration • Controlled certain parts of process, ie: all mining or all shipping • Standard Oil forced all weaker competitors to the wall • Trusts: giant monopolistic corporations • Rockefeller also put his own men on boards of directors of other rival companies • “interlocking directories”

  11. Supremacy of Steel • 1860: scarce, expensive • 1900, US produced more than England & Germany together • Due to Bessemer process (though American, Wm Kelly discovered it first) • Cold air blown over molten steel allows iron burned carbon impurities to rise up and be skimmed off • Purifies iron into steel • US had abundant iron, coal (heating)

  12. Carnegie • Began as poor clerk for RR co • Acted quickly to resolve company crisis • Rewarded w/ opportunity to buy stock.. Quickly bought up as much as he could • Eventually owned RR • On to Steel. • Pittsburgh area- produced ¼ nation’s Bessemer Steel • J.P. Morgan (banker) attempted to move into Steel tubing • Carnegie threatened to ruin him • Negotiated settlement: Morgan bought out Carnegie for $400 million • Carnegie gave away $350 mill to charity, pensions, libraries • Added other steel holdings, formed: US steel 1901: first billion $$ corp in world

  13. Rockefeller • 1859 Drake first mined oil in Titusville PA • By 1870s used to light kerosene lamps all over nation (whale oil – obsolete) • By 1885 1/4mill Edison Electric light bulbs in use- made kerosene obsolete • Industry shifts to gas burning internal combustion engine • Rockefeller already owned 95% oil production in US when he org’d Standard Oil of Ohio 1882 • Crushed weaker competitors • American Beauty Rose theory of competition • Trusts: built superior product at cheaper price, Gustavus Swift & Philip Armour: meat barons

  14. Gospel of Wealth • Many rags to riches stories (Horatio Alger) in real life • Newly rich feel some are destined to become rich (predestination.. Calvinist) AND help society w/ $$ • Rev. Russell Conwell (Phila) bcm rich on his lecture: “Acres of Diamonds” preached poor people made themselves poor, rich made themselves rich.. Everything was based only on your actions • Corporate lawyers used 14th amendment to defend trusts as living entities (big people) entitled to their property • Plutocracy ruled

  15. Gov attacks trusts • 1890: Sherman Anti-trust Act • Forbade combinations in restraint of trade • No distinction between good & bad trusts • Could not be enforced • 1914- enforced, violators first punished

  16. South in Age of Industry • Agrarian • James Buchanan Duke: cigarette industry: • American Tobacco Company • Donations to Duke University • Henry Grady (Ed. Atlanta Constitution) urged S. to industrialize • No. companies set rates to keep S from gaining competitive edge • Textile mills developed in S • Cheap labor led to creation of many jobs, (low wages) still welcomed in S

  17. Impact of Industrial Age • Standard of Living rose • Immigrants poured in for opportunities • Jeffersonian ideas of dominance of agriculture faded • Women swarmed to factories, found new opportunities • Gibson Girl (Charles Dana Gibson): romantic ideal of the age • Pressures of foreign trade developed • Overproduction will drive us to develop more foreign markets • Leads to Imperialism

  18. In Unions There Is Strength • National Labor Union • 1866- 600,000 members- lasted only 6 yrs • Excluded Chinese • Never recruited blacks; women • Worked for arbitration of industrial disputes • & 8 hr day • Won 8 hr day for Gov workers- till Depression 1873

  19. Unions (2) • Knights of Labor • 1869 – 1881 (in secret) • Barred only liquor dealers, prof. gamblers, lawyers, bankers, stockbrokers • Campaigned for economic & social reform • Led by Terence V. Powderly • Won many strikes for 8 hr day • After strike against Jay Gould’s Wabash RR 1885, membership went up to ¾ million

  20. End of Knights of Labor • Involved in several May Day strikes; half failed • Chicago: (80K knights & hundreds anarchists) • May 4, 1886- Police advancing on meeting called to protest brutality by authorities (Haymarket Sq) • Bomb thrown, killing & injuring many • 8 anarchists rounded up; no proof • Jury sentenced 5 to death for conspiracy • Other 3 long prison terms • 1892 John P. Altgeld, Dem Gov IL pardoned 3 survivors after studying case • Defeated in re-election bid • Forever assoc w/ anarchists- KOL membership dropped

  21. A F of L • 1886- Samuel Gompers founded Am Fed of Labor • Assoc of self gov’d unions, all indep • Demanded ‘fairer share for labor’ • Better hours, wages • Skilled workers only (labor trust) • 1881-1900 over 23,000 strikes; w/ 6.6 mill workers • Still less than 3% of all workers unionized. • 1894 Labor Day became legal holiday • Most owners fought unions still

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