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Chapter 13

Chapter 13. The Rise of Industrialism. 13.2 New Innovations and Technologies. Before this time U.S. mainly Agricultural Society. TJ saw U.S. as a land of Yeoman farmers Inventions needed investors to be able to fund these new ideas

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Chapter 13

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  1. Chapter 13 The Rise of Industrialism

  2. 13.2 New Innovations and Technologies • Before this time U.S. mainly Agricultural Society. • TJ saw U.S. as a land of Yeoman farmers • Inventions needed investors to be able to fund these new ideas • capitalism: an economic system in which factories, equipment, and other means of production are privately owned rather than controlled by government. • Investing was a big risk, but paid off for many • Example: Edison backed by J.P Morgan • Patents protected inventors and investors

  3. 13.2 New Innovations and Technologies • Big Inventions • Electric Lightbulb- Thomas Edison ( the Wizard of Menlo Park) • The Telegraph – Samuel F.B. Morse • The Telephone- Alexander Gram Bell • The Automobile- Came from Europe • The First powered airplane flight- The Wright Brothers near Kitty Hawk, NC • Oil Drilling- Use instead of Whale Oil • Bessemer Process- New stronger steel= bigger buildings • central generating station for electricity- Thomas Edison

  4. 13.3An Explosion of Industrial Growth • Companies selling goods nation wide- need new ways to operate to meet demand • How to do it? • Specialized Machinery • Many Unskilled Workers- and a few supervisors • Reorganize the factory- one person does a single task • Fredrick Taylor • Motion Studies- more efficient- The Principles of Scientific Management • Henry Ford • Pioneered the moving assembly line

  5. 13.3 An explosion of Industrial Growth • As business grows the factors of production grow as well • land, labor, and capital • Capital is any asset that can be used to produce an income. Money, buildings, tools, and machinery are all forms of capital. • A corporation is a company that is recognized by law as existing independently from its owners • By buying stock, investors became owners of the company. • Business owners began devising ways to reduce competition. One method was to buy or bankrupt competitors. • Rockefeller- Standard Oil- Monopoly. • Monopoly-company that completely dominates an industry • trusts [trust: a set of companies managed by a small group known as trustees, who can prevent companies in the trust from competing with each other]. A trust is a set of companies that are managed by a small group known as trustees. Keep companies from competing

  6. 13.4 Big Business and the Government • Trusts and monopolies concentrated capital—and power—in the hands of a few people • horizontal integration [horizontal integration: a corporate expansion strategy that involves joining together as many firms from the same industry as possible]. – Rockefeller- Standard Oil • vertical integration [vertical integration: a corporate expansion strategy that involves controlling each step in the production and distribution of a product, from acquiring raw materials to manufacturing, packaging, and shipping].- Carnegie Steel

  7. 13.4 Big Business and the Government • The Government Leaves Business Alone • laissez-faire [laissez-faire: the idea that the free market, through supply and demand, will regulate itself if government does not interfere]. “Allow to do” or “Leave business alone” • social Darwinism [social Darwinism: an idea, based on Charles Darwin's theory of evolution, that the best-run businesses led by the most capable people will survive and prosper], • The Government actually aided business by tariffs and low prices on land • Allows the economy to prosper By 1900, the United States had the strongest industrial economy in the world.

  8. 13.4 Big Business and the Government • Government Takes Some Action to Limit Business • Sherman Antitrust Act [Sherman Antitrust Act: an 1890 federal law that outlawed trusts, monopolies, and other forms of business that restricted trade] • the Sherman Antitrust Act was full of vague language which made it hard to enforce

  9. 13.5 The Guilded Age • Book by Mark Twain-The Gilded Age. = Something that is gilded looks like gold, but only on the outside. • 3 Industries make U.S. economy soar • 1. Steel-Carnegie • 2. Oil- Rockefeller • 3. Railroads-Vanderbilt • Entrepreneurs-bold risk-takers who established new businesses. Along the way, they amassed huge fortunes. • Carnegie’s Rags to riches story • After arriving from Scotland in 1848 at the age of 12, he worked in a Pennsylvania cotton mill earning $1.20 a week. His thrift and shrewd investments gave him a $50,000 annual income by the time he was 30. • "A man who dies rich dies disgraced."

  10. 13.5 The Guilded Age • philanthropist [philanthropist: a person who gives money to support worthy causes] • Carnegie and Rockefeller both gave millions to education, libraries, etc. • Vanderbilt never believed he had a duty to use his wealth to benefit society. Nevertheless, he donated $1 million to found Vanderbilt University in Nashville, Tennessee. • Robber Barons or Captains of Industry??

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