U.S. History SSUSH 11

1. U.S. History SSUSH 11

2. The student will describe the economic, social, and geographic impact of the growth of big business and technological innovations after Reconstruction. SSUSH 11

3. SSUSH 11a Explain the impact of the railroads on other industries, such as steel, and on the organization of big business

4. RAILROADS Industrial Growth

5. Railroad • The growth & consolidation of railroads benefited the nation & led to the creation of the first large industries in the U.S. They made possible the expansion of industry across the U.S.

6. Transcontinental Railroad • The Pacific Railway Act provided for land grants to railroads that would build a rail line linking the east to the west. • The Union Pacific begin building westward from St. Louis and the Central Pacific began building eastward from Sacramento, California.

7. Transcontinental Railroad • The two lines would eventually meet at Promontory Point, Utah in 1869 completing the first transcontinental rail road. Other rail lines soon followed.

8. Immigrant Labor • Building the transcontinental Railroad depended largely on immigrant labor. • The union Pacific relied on large numbers of Irish immigrants & Civil War veterans.

9. Immigrant Labor • The Central Pacific began hiring large numbers of Chinese immigrants. • The Chinese would work long hours for less money than white workers. • White workers were paid about $45 a month plus food. The Chinese would work for $35 a month & supply their own food (they didn’t the food the railroad provided). The work was dangerous many died.

10. Railroad Time • It soon became clear that a new standard time would be needed to keep trains running on a schedule and not colliding on the same tracks due to different time schedules

11. Railroad Time • Therefore railroad companies created the first time zones in the United States. • Initially called “Railroad Time” it was adopted in 1883 & became law in 1918.

12. Railroad time • Railroads helped create new towns and markets. • Movement west was increased by the rail roads. • Abilene, Kansas & Chicago, Illinois are examples of towns that grew due to railroads. • Farmers and ranchers could transport their crops & cattle east & finished goods could travel west.

13. SSUSH 11a Explain the impact of the railroads on other industries, such as steel, and on the organization of big business

14. The Increase in Railroadsstimulated national economic growth. The growth of Railroads contributed to the rise of big business & the steel industry.

15. Bessemer Process • Process for making steel invented by Henry Bessemer. • Made Steel stronger by removing impurities. • Uses air to blow out gases and carbon that weaken steel.

16. Benefits of the Bessemer Process • Steel made cheaper and more affordable. • Made for faster expansion of railroads. And more construction. • Products made from steel are longer lasting and withstand pressure

17. Effects of Steel Industry • Faster expansion of railroads • Taller buildings (skyscrapers) • Ability to ship large amounts of products over land quickly • The ability to carry goods & resources great distances in a timely manner was a major contributor to the growth of big business.

18. The 1860s Expansion of Railroads caused Big Business to dominate the Economy of the United States.

19. Giants of Big Business • Cornelius Vanderbilt- extended his New York Central railroad to reach Chicago. Travelers could go form New York to Chicago without having to transfer trains multiple times.

20. Andrew Carnegie • Scottish born founder of Carnegie Steel • Company that produced more steel than all of Great Britain • Sold his company to J.P. Morgan for almost $500 million in 1901 (made him richest man) • Then devoted his time to “Gospel of Wealth” – using his wealth to finance philanthropy

21. SSUSH 11c Identify John D. Rockefeller and the Standard Oil Company and the rise of trusts and monopolies.

22. John D. Rockefeller • Founder of the Standard Oil Company in 1863 at the age of 24 • He bought out or destroyed his competition, • Set up a monopoly on the oil industry and became very wealthy • Tactic was Horizontal integration – He bought out all competitors to create a Monopoly then a Trust.

23. J. P. Morgan • Bought Carnegie Steel in 1901 • He merged it and other steel companies into US Steel in march 1901

25. “Robber Barons” “Captains of Industry” • Wealthy entrepreneurs and businessmen during the Industrial Age • Made the U.S. extremely wealthy – referred to in a positive way as “Captains of Industry” • People underpaid, child labor, poor and unhealthy working conditions in order to make a profit – referred to as “Robber Barons” • Notable robber barons include Andrew Carnegie and John D. Rockefeller

27. Monopoly • Main goal is to eliminate competition. • Considered unfair by progressives. • During the 1800s industrial and business leaders accumulate wealth by forming monopolies and trusts.

28. Characteristics Definition An economic market in which there is only one supplier of a product and no market competition and the company has complete control over quality, wages, Prices. The only company. No other choice to buy the product or service. Monopoly : Examples Non-Examples Georgia Power is the only power company in Reidsville & Canoochee EMC is the only power company outside the city in Tattnall County. If you want a cell phone you can shop with (Choice): Verizon Wireless or Alltel

29. Organization of Business to Eliminate Competition Horizontal Integration Vertical Integration A business strategy in which one corporation owns not only the company that produces the finished product, but also the companies that provide the materials needed. In some instances, the transportation to the market is also owned. • A business strategy in which one corporation buys out all of its competitors. For instance, One Steel mill will buy out other steel mills that are competing against it.

30. Vertical Integration • Type of organization in which a company owns and controls the entire process of production from raw materials to manufacture and sale of finished product.

32. Andrew Carnegie

33. Example of Vertical Integration Used by Andrew Carnegie in the formation of Carnegie Steel company

34. Owns Company that Makes Steel

35. Owns Iron Ore Mine

36. Owns Railroad to Transport Steel

38. Purpose of Horizontal & Vertical Integration • John D. Rockefeller once said in his own words that he was determined to “pay nobody a profit” • The purpose was to cut down on cost and enjoy the profits of the business. • Simple formula to get rich: Bring in more money than you pay out!

39. John D. Rockefeller & Vertical and Horizontal Integration • John D. Rockefeller owned the Oil industry. • Rockefeller bought out other oil businesses. (Horizontal Integration). • Rockefeller also owned his own barrels, cans, to ship the oil in, the railroad to ship the Oil on, etc. (Vertical Integration). • Rockefeller went a step further when he joined other Monopolies to form a TRUST!

40. Trust A business formation in which competing companies create one large corporation and each company is entitled to dividends.

41. Characteristics Definition Set prices. Control the industry. Total economic domination. A business arrangement under which a number of companies unite into one system with the intention of destroying competition and creating monopolies. Trust : Examples Non-Examples Trusts are illegal now so there are not real examples. Verizon, Alltell, At&t, Microsoft, and internet providers are not together and must COMPETE with one another to get consumers money. If Verizon, Alltell, At&t, and Microsoft, Internet providers come together they could dominate the communication industry. Eliminate competition, set prices, Competition results in cheaper prices, better quality, and more services.

43. Laissez-Faire • The idea that government would have a “hands-off” policy and would not regulate big Business • No Minimum Wage, No OSHA, No law against child labor, no regulatory commissions for safe and clean food. Adam Smith Wealth of Nations

44. Social Darwinism • Theory that grew out of Charles Darwin’s Origin of the Species theory of biological evolution. • “survival of the fittest” Natural Selection • Social Darwinism was a theory created by Herbert Spencer to explain the evolution of human society. • This theory justified the disparity in wealth and encouraged unregulated competition and frowned on government regulation.

46. Characteristics Definition Only the fittest will be rich. Weaker will be poor. It is natures way. Natural for this to be. The idea that promoted inequality in wealth based on Charles Darwin’s theory of evolution but transferred to social differences among humans. Social Darwinism : Examples Non-Examples Everyone is equal and should have the same pay regardless. Bill Gates is rich because he is intelligent and worked hard. Average individual that drops out school, doesn’t read, and does drugs lives in poverty and jail because he/she is weaker and inferior. Government Regulation of Business. (minimum wage, OSHA, 40 hr. work week, no child labor) Redistribution of Wealth - Socialism.

47. John D. Rockefeller Quote “The growth of large business is merely the survival of the fittest.”

48. SSUSH 11b Describe the impact of the railroads in the development of the West; include the transcontinental railroad, and the use of Chinese labor.

49. Impact of Railroads - Positive • Made it easier for people to move west and populate the west at a faster rate. • Made life in the west possible by allowing farmers, ranchers, and other settlers access to eastern markets and resources.

50. Impact of Railroads - Negative • Native Americans will suffer. • Buffalo are killed and great numbers by fur trappers and cow ranchers and the Plains Indians relied heavily on the Buffalo to live. • Interrupted Native American way of life. • Native Americans forced to relocate to reservations. • Native Americans forced to assimilate American customs and ways of life. (Dawes Act)