Chicago 1835-1900

1. Chicago 1835-1900 It’s going to be the next big thing

2. Boosters • In 1836, Chicago had a population of only 3,820. But it was no longer a French & Indian trading village. • Chicago had boosters who said that it would be a major city and become the transportation hub to the West, but other cities seemed primed to get there first. Milwaukee and Michigan City, IN were both larger than Chicago and had their own boosters. • St. Louis was already a large established city enjoying a thriving trade with New Orleans.

3. Michigan and Illinois canal • In 1833 it was announced that the State of Illinois would build a ninety-six mile long canal connecting the Chicago River with the Illinois River. This would provide an all-water route for the Atlantic to the Gulf of Mexico at a time when all freight transportation was by water. (Atlantic Ocean > St. Lawrence Seaway > Great Lakes > Chicago River > Illinois River > Mississippi River > Gulf of Mexico)

4. canal • Announcement of the canal created a land boom in Chicago. Eastern investors saw a great opportunity to invest in land around the proposed canal. Some Easterners came to Chicago to watch over their investments, increasing the population. • Construction on canal didn’t begin until 1836 and wasn’t completed until 1848. • The Irish were the first immigrants to come to Chicago, in order to work on the canal. Big projects like the canal require lots of labor, and the immigrants supplied the labor.

5. immigration • By 1860 there 110,000 citizens living in Chicago, and half of them were foreign born. These included 21,000 Germans, 20,000 Irish, and 2,200 Scandinavians (Swedes and Norwegians).

6. The canal worked well • In the first year of operation (1848) corn shipments to the city increased by a factor of eight, and lumber shipments doubled. • The new canal tripled the geographic area controlled by Chicago merchants (allowing them to sell to three times more people than before, thus allowing them to expand their businesses and hire new people, and thus increasing the city’s population). • The canal was a huge success. But in a shorter time than it took to build the canal in became obsolete because of…

7. Railroads • In 1848, the year the canal opened, there was ten miles of railroad track in Chicago. • By 1857 there was three thousand (!) miles of railroad track in Chicago and 100 trains came and left the city every day. • Railroads revolutionized business in Chicago, making the geographic area a Chicago business could serve virtually nation-wide (as a customer buying something or a farmer selling something would no longer have to be near a body of water).

8. Railroads • Railroads routed most east-west travel through the city. No railroad operated track both east AND west of the city, meaning goods and humans would have to be unloaded and and re-loaded here, making Chicago an ideal place for warehouses and hotels and, therefore, merchants. • Business boomed. And people flocked to the city. Chicago’s populations went from 30,000 in 1850 to 110,000 in 1860. • Chicago began to dominate four industries that caused the city to grow even larger: grain, lumber, meatpacking, and the mail-order catalog.

9. Railroads changed time • Because Chicago was the nation’s largest rail hub, many railroads had their corporate offices here. • During most of the 19th century every major city kept their own time for themselves and their immediate surrounding area, which was fine when everyone stayed in the same place, but very difficult when railroads allowed people to travel far and frequently. • In a meeting of railroad executives in Chicago in 1883, time zones were invented, and for the first time ever, everyone in any part of the country would know exactly what time it was in any other part of the country.

10. Wheat: The Golden Grain • Prior to 1850 farmers in the sparsely populated Midwest rarely grew wheat, instead they grew corn. Corn is hardy, it doesn’t need to be processed before it can be eaten, it won’t spoil if it takes a long time to get to market, and surplus can be fed to livestock. None of those things are true of wheat. But wheat was worth a lot more.

11. Wheat: the golden grain • One of the issues with growing wheat is that a farmer only has a few days to harvest it and get it to market before it spoils, and if there isn’t enough labor then the whole crop could go bad. • Cyrus McCormick’s reaper solved that problem. McCormick’s invention allowed farmers to harvest wheat without additional labor help. McCormick built his reaper factory in Chicago in 1847.

12. Wheat: the golden grain • McCormick invented two other things besides the reaper: newspaper advertising and credit. The advertising allowed farmers to know about his reaper. Credit allowed them to use it. The reaper was expensive, and farmers wouldn’t have cash till after a harvest, so credit was the only way to go.

13. Wheat: The Golden Grain • At around the same time, the automatic grain elevator was invented. These were massive storage facilities that allowed wheat to be stored without spoilage for a longer time than before, and also allowed grain to be unloaded/loaded from railcars or ships without a lot of human labor. Many were build in Chicago along the banks of the river. They became Chicago’s first tall buildings.

14. Wheat: The Golden Grain • Finally, the railroads all came to Chicago. So farmers could now easily harvest wheat and send it via rail to Chicago, where it could be stored in an elevator, re-sold, and immediately shipped anywhere in the country. • Reaper + Railroad + Grain Elevator = Wheat is a big reason for the growth of Chicago.

15. Would you like some wood? • The need for lumber in the Midwest was great. The prairies were ideal for large wheat crops because they were treeless, but farmers needed lumber for homes, barns, fences, and heating fuel. • The railroads themselves created a demand for lumber. Railroad track construction required wooden railroad ties.

16. Would you like some wood? • Chicago needed its own lumber. Homes, wharves, warehouses, stores, and sidewalks were made of wood. • The wood used was white pine, which came from the forests of upstate Minnesota, Wisconsin, and Michigan. Unlike hardwoods, white pine floats, so lumberjacks could float the lumber down the Great Lakes to Chicago. • My laborers who worked on farms in the summer travelled to the North Woods to work as lumberjacks in the winter.

17. Would you like some wood? • Chicago merchants bought the lumber and sold it west, travelling by train. • By 1867, more than 200 lumber-bearing ships unloaded in Chicago every day. By 1884 there was the equivalent of 250,000 trees stacked in lumber yards in Chicago. The lumber yards were located on the South Branch of the Chicago River, where the wood could be moved by water or rail.

18. Would you like some wood? • The lumber business began to decline by 1900 because railroads went directly to the sawmills near the forests, and lumberjacks could sell retail. Also, white pine declined in popularity compared the the Douglas fur of the Pacific Northwest and the yellow pine of the South.

19. We have the meats • The Chicago Stockyards were the city’s biggest tourist attraction. As many as 10,000 visitors a day came to watch the butchering. • What made the Chicago meatpacking industry unique was that butchering became a centralized science.

20. We have the meats • Before the Stockyard, in the 1850s, Chicago’s many small stockyards sold live pigs, cattle, and sheep to city butchers, who killed the animals themselves and prepared the meat in their shops. • The Civil War changed that. With more than one million men in uniform, there was an unprecedented demand for processed (salted, brined) meat. • In 1864 the Chicago Pork Packers’ Association purchased a half-square mile four miles south of downtown, which became the centralized Stockyard.

21. We have the meats • The Stockyard had three miles of water troughs and ten miles of feed troughs. Thirty miles of drain pipes carried blood and other waste directly into the Chicago River. • By 1868 the Stockyard held 21,000 cattle, 75,000 hogs, 22,000 sheep, and 200 horses at a time. • An army of 25,000 men worked at the Stockyard. On the “disassembly line” an animal was bled, skinned, scraped, and butchered, then plunged immediately in a forty-acre large chilling room.

22. We have the meats • People were used to preserved pork, but Americans preferred their beef fresh. Chicago butchers had a hard time convincing people back east to buy their beef until Gustavus Swift invented the refrigerated rail car. • When Eastern butchers refused to sell Chicago beef, the agents for Chicago companies sold beef directly off the rail car at ridiculously low prices.

23. We have the meats • The meat companies only broke even on selling consumable meat. They made their profit on the other stuff: hide, skull, hooves, internal organs, cartilage, and bones were made into margarine, brushes, combs, bouillon, musical instrument strings, fertilizer, glue, buttons, and chess pieces. • By 1893 one in every five people in Chicago was somehow connected to the meatpacking industry.

24. Order it up • In 1872, in Chicago, Aaron Montgomery Ward opened the first mail-order retail company in America. 125 years before Internet retail, the Montgomery Ward catalog allowed people to buy goods without being in the physical presence of the products (or salesmen) for the first time. • The catalog allowed rural farmers in the Midwest to be almost as much a part of the Chicago economy as residents on downtown State Street.

25. Order it up • In the late 1800s farmers were increasingly upset by the profits taken from middlemen and travelling salesmen. Farmers formed an alliance that became known as the Grange Movement and resulted in the formation of a short-lived but influential third political party, the Populist Party. Ward was able to take economic advantage of this situation.

26. Order it up • Ward was prepared to open business in 1871, but a little complication called the Great Chicago Fire set him back a year. • Ward bought consumer goods in mass quantities, which enabled him to buy at the lowest possible prices. By buying directly from Ward, farmers could bypass the greedy middleman and pay low wholesale prices.

27. Order it up • Ward offered an unconditional money-back guarantee, which was an innovation. • In 1874 the Ward catalog was 8 pages long. By the end of the 1880s it was 540 pages long. By 1900 it was 1,200 pages long and contained 70,000 items. • In 1893 Richard Sears got into the business for himself, following the Ward formula, but combining advertising that convinced customers to buy things rather than just listing them.

28. Order it up • Sears was a staggering success. He reached $50 million in sales in 1902. When Sears and his 9,000 employees moved into a new 40-acre building on Chicago’s West Side in 1906, Sears was the largest retail business in the world.