Economic Reform

1. Economic Reform SSUSH7 Students will explain the process of economic growth, its regional and national impact in the first half of the 19th century, and the different responses to it. a. Explain the impact of the Industrial Revolution as seen in Eli Whitney’s invention of the cotton gin and his development of interchangeable parts for muskets.

2. Industrial Revolution • A variety of inventions that produced goods and materials faster and more cheaply became known as the Industrial Revolution. • Began in Britain in the 1700s with changes in the textile industries • Important inventions of the Industrial Revolution: spinning jenny, the power loom, steam engine

3. Industrial Revolution Continued • Eli Whitney came up with the theory of interchangeable parts (parts made to an exact standard) and the cotton gin (machine that separates the seeds from raw cotton) • Whitney assembled a musket from pieces chosen at random from a crate of parts – this lead to developing tools with which unskilled workers could make uniform parts • The invention of the cotton gin caused profit from cotton to skyrocket, causing many southern planters to use it as their main crop – they expanded their land to grow more cotton

4. Whitney’s Inventions

5. Transportation • Transportation advances were key in the industrial revolution – it allowed people in different regions to do business with each other and allowed the economy to grow through communication, travel, and transportation of goods • Roads were built – this began to connect the U.S. together and made travel and trade easier

6. Transportation • River travel – the Steamboat was invented, making it possible for boats to travel upriver instead of having to float with the current – this also increased trade • Canals – man made waterways built because natural waterways did not go everywhere people needed to go • The Erie Canal stretched 363 miles and connected the Atlantic Ocean to the Great Lakes • This helped make New York the dominant port in the country

7. Transportation • Railroads – first one in U.S. constructed in 1828 and began in Baltimore, MD • Railroads were fast, able to cross almost any terrain, and could operate in severe weather • By 1840 – the U.S. had more than 3,300 miles of track

8. Communication • Mail increased • Newspapers, magazines, and books became popular as the nation’s literacy rate increased

9. Market Revolution • New inventions changed the way Americans made, bought and sold goods • This caused the American economy to soar after the War of 1812

10. Manufacturing • In the early 1800s, the U.S. was a country of farmers – advances in technology caused people to turn to manufacturing – the use of machinery to make products • Began in New England – the power from rivers there ran the mills • Free enterprise system – an economic system in which private companies compete for profits

11. Working and shopping • Americans began to work outside the home in factories or other professions rather than on farms • The self-sufficient family began to disappear – people worked for money and then shopped for the things they needed in stores

12. Banking • The first banks appeared in the U.S. in the 1780s and 1790s • Most loans were made from investment capital – money that a business spends in hopes of future gain • In the 1800s, banks were not restricted to making loans to people who could pay them back – an economic crisis could cause the banks to fail • Bank notes were the most common form of money – a piece of paper banks issued to their customers – not paper money