Big Business Organized Labor

1. Big Business Organized Labor Unit 5: Growing Pains

2. Rise of Big Business: Causes • Labor Shortage • Labor saving machinery • Technological Innovation • Standardization • Advances in productivity • Agriculture Production • Directed by the industrial sector • Provide cattle to slaughter and products to be milled • Railroad Network • Inexpensive Power Sources • Governmental Support • High-tariff on foreign imports • Land and Cash for the railroad

3. Second Industrial Revolution • Mid-19th Century • U.S. and Germany • Three related developments • Transportation • Electric Power • Scientific research

4. Railroads • First big business in the U.S. • Key to opening the west • Aided in development of other industries • Iron, steel and lumber consumers • Created an interconnected national market • Magnet for financial investment • Transcontinental plan • Construct a railroad line from the Missouri River to Pacific Ocean

5. Financing Railroads • Private Companies • Bonds • 1850 government subsidy • $707 million in cash • $335 million in land • Good Investment by government • Half fare or free for government hauling • Linked country together • Jay Gould • Railroad speculator • corrupt • Commodore Cornelius Vanderbilt • Consolidated control of New York Central railroad

6. Transcontinental Railroad Union Pacific Central Pacific Extended westward from Omaha Pre-Civil War construction Work crews of ex-soldiers, former enslaved and Irish and German immigrants Extended eastward from Sacramento Pre-Civil War construction Work crews of Chinese immigrants Lines met in 1869

7. Financing Railroads • Private Companies • Bonds • 1850 government subsidy • $707 million in cash • $335 million in land • Good Investment by government • Half fare or free for government hauling • Linked country together • Commodore Cornelius Vanderbilt • Consolidated control of New York Central railroad

8. Technological Advances • Bessemer and open hearth process • Made steel faster and cheaper to produce • Refrigerated car • Meat packing industry • Thomas Edison • Electricity • Alexander Graham Bell • Telephone

9. Robber Barons or Captains of Industry?

10. Rockefeller and the Oil Trust • Rose from poverty • Obsessed with order • “pay nobody a profit” • Practiced vertical integration • No middle man • Company produced everything related to the production of oil

11. Carnegie and the Steel Industry • Born in Scotland • Rags to Riches • Textile mill to captain of industry • Gospel of Wealth • Philanthropy • Distributor of Wealth

12. J.P. Morgan Financier • Born to wealth • Investment banker • Buy cooperate stock and bonds to sell at a profit • 1890s saw Morgan controlling 1/6 of the nation’s railways • Bought Carnegie steel and iron holdings $480 million • United Steel first billon dollar corporation

13. Retail • Montgomery Ward • Mail-order catalogues • Reduced middle men • Cut prices • Sears, Roebuck and Company • Helped create a national market • Catalogue featured a plethora of items

14. Impact of industrialization • Impact of industrialization • Cheaper goods; higher standard of living for many workers • But these improvement came hand-in-hand with a dehumanizing work environment • Mechanization led to deskilling • Alienation from labor • Adjustment to industrial time

15. Labor • Developments in labor Wealth and income • Standard of living • Disparities between rich and poor • 10% of American families owned ¾ of the nations physical wealth in both 1860 and 1900 • Degree of social mobility • Upward mobility was common • Increase in manufacturing wages • Living and working conditions • Average work week 59 hours

16. Economic conditions • Increasing class polarization • 1890: Only 45% of all workers earned enough to keep them above the poverty line • 25% lived in real destitution • Relied on labor of women; children • Only 15% able to earn between $800-1100/yr • Highly unstable economy • Workers routinely through out of work

17. New industrial workforce • 1860-90: # of industrial workers rose from 885,000 to 3.2 million • 1/3rd of the entire population • 1/3rd of industrial workers foreign-born • Worked 10-12 hour days; 6 or even 7 days a week • In extremely dangerous conditions • Example of RR work • 1890-1917: 72,000 workers killed; 2 million injured • No workmen’s compensation

18. Chinese Labor • Lured to California by gold rush and railroad jobs • Most single men • Earn money and return home • Endured harsh working conditions for less pay • $27 to $30 per month minus room and board • Irish workers received $35 a month with board

19. Child Labour • In 1900, an estimated 20 million children working full time • Some worked 12 hours a day and six days a week

20. Knights of Labour • Uriah Stephens in 1869, Philadelphia • Secrecy • Platform • Previously advocated 8 hour workday • Elimination of convict-labor competitions • Paper currency • Equal pay for equal work • Haymarket Affair 1886 • Strike to advocate shorter workday by the • Anarchist protest rally • Peaceful until police official sent unit to disperse crowd • Pipe bomb thrown into police killing seven • Police fired on the crowd, killing 4 workers • Integrations and detainment of workers followed

21. American Federation of Labour • 1886 an alliance of craft unions non-industrial • Samuel Gompers • Focused the AFL’s efforts on concrete economic gains • Higher wages • Shorter working hours • Better working conditions • Growth of AFL • 1900 about 500,000 members • 1914 2 million • 1920 4 million

22. Violence in Union Activity • Molly Maguire's • Secret Irish organization • Fought against the dangerous working conditions • Practiced retaliation • Railroad Strike of 1877 • First major interstates strike • In response to wage cuts • Walk outs and sympathy walk-outs • Spread from Maryland to San Francisco • Disorganization led to violence and looting • Pittsburg 26 dead • Strike failed • Denis Kearney • Workingmen’s Party • Anti-Chinese immigration • Party elected many members to state legislature and a mayor • Lasting legacy was the 10 year prohibition on Chinese immigration • Anarchism

23. Violence in 1890s • Homestead Strike, 1892 • Tarnished Carnegie reputation • Fick cut wages and broke the union • Lock-out • Pinkerton Agency • Fight b/w strikers and militia • Pullman Strike, 1894 • Walkout that paralyzed the economies of twenty-seven states and territories • Cut wages but did not lower rents and other charges • Strike ended through government interference

24. Socialism in American Labor • Karl Marx • Daniel DeLeon and Eugene Debs • Social Democratic party • Early work • Height of influence • Rise of the IWW • 1893 in Montana • Industrial workers, • Revolutionary goals • Destruction of government, replacement by on big union • Causes for decline • Internal disputes • Labeled as anarchist

25. Factors that hampered unionization in the US • Ethnic and racial diversity • Threat of scabs • High rates of geographic mobility • Relative social mobility • No labor party • Corporations wielded enormous power • Back by the federal government

26. Fundamental questions • What conditions led to widespread worker unrest and violence? • Why did that violence not lead to a high level of unionization? • Germany • Virtually all skilled workers belonged to a union • 35-50% of unskilled male workers • 10% of women • U.S. • By 1900, 8% of all workers unionized; vast majority skilled workers • 3% of women