A NEW INDUSTRIAL AGE

1. A NEW INDUSTRIAL AGE

2. Section 1“The Expansion of Industry” • NATURAL RESOURCES FUEL INDUSTRIALIZATION • After the civil war, the US was still largely an agricultural nation. • 60 years later, the US became the leading industrial power in the world. • Due to: wealth of natural resources, government support for business, & a growing urban population that provided cheap labor & markets for new products.

3. BLACK GOLD • Eastern Native Americans made fuel and medicine from crude oil long before Europeans arrived. • Abraham Gesner discovered how to distill fuel from oil & coal and Americans began using kerosene to light lamps. • 1859, Edwin L. Drake successfully used a steam engine near Titusville, Penn. to drill for oil. • The steam engine made removing oil from beneath the earth’s surface practical. • Oil Boom: Kentucky, Ohio, Illinois, Indiana, & Texas • Petroleum refining industries transformed oil into kerosene. • Gasoline was thrown away until the auto became popular in which time gasoline became the most important form of oil.

4. BESSEMER STEEL PROCESS • US had very abundant deposits of coal & iron. • Coal production increased from 33m tons in 1870 to more than 250m tons in 1900. • Iron = dense, soft, tends to break and rust.; contains carbon. • Removing the carbon = lighter, more flexible, rust resistant metal called steel. • Bessemer Process involved injecting air into molten iron to remove the carbon and other impurities. • 1880, 90% of the nations steel was made through this process. • Bessemer process was replaced by the 1860s by an open-hearth process which produced quality steel from scrap metal as well as raw materials.

5. NEW USES FOR STEEL • Railroads were the #1 customers for steel b/c of the thousands of miles of tracks being laid for travel. • Other uses: Joseph Glidden’s barbed wire; McCormick & Deere’s farm machines.

6. NEW USES FOR STEEL • Face of the Nation: Brooklyn Bridge (1883) spanned 1,595ft. Home Insurance Building in Chicago was the 1st skyscraper. • Before steel, buildings were supported by their walls and iron frames that limited buildings height. • Steel frames allowed architects to build up as high as they wanted.

8. INVENTIONS PROMOTE CHANGE • Because of natural resources and peoples own ingenuity, inventors changed not only the landscape of America, but also the way people lived and worked.

9. THE POWER OF ELECTRICITY • Thomas Alva Edison perfected the incandescent light bulb & developed an entire system for producing and distributing electrical power. • Along with Edison, George Westinghouse made electricity safer and less expensive. • Electricity completely changed the way businesses were run in America at the time. Running machines such as fans & printing presses. • Electricity became available in homes & brought about time saving appliances. • Electric streetcars made city travel cheap and efficient as well as promoting the outward spread of cities. • Electricity allowed manufacturers to locate plants anywhere, not just where power was available. • Electricity equals industry growth!

10. INVENTIONS CHANGE LIFESTYLES • Christopher Sholes invented the typewriter (1867) • Alexander Graham Bell & Thomas Watson invented the telephone (1876) • Telephone is probably the most dramatic invention next to the light bulb.

11. INVENTIONS CHANGE LIFESTYLES • Typewriter and Telephone created new jobs for women. • Women were 5% of work force in 1870, b/c of these inventions, by 1910 women made up 40% of the clerical work force. • Home work was now done in factories b/c of inventions. • Industrialization allowed sewing to be done in factories which allowed mass-production of clothing, which in turn provided a need for female workers. • Industrialization freed factory workers of hard labor and improved workers standard of living. • Average workweek was reduced by 10 hours. • Laborers felt their worth was declining due to so many tasks being mechanized.

12. Section 2“The Age of the Railroads” • RAILROADS SPAN TIME AND SPACE • Railroads were very important to westward expansion for both people and business. • The government gave the railroads huge land grants and loans b/c of the importance they had in settling the West.

13. A NATIONAL NETWORK • 1856 – Railroads extended west of the Mississippi River. • 1859 – Railroads crossed the Missouri River • May 19, 1869 crowds cheered as the Central Pacific and Union Pacific Railroads met at Promontory Point Utah. • 1st Transcontinental Railroad was marked with a golden spike.

14. ROMANCE AND REALITY • Railroads brought dreams of available land, adventure, and a fresh start to Americans, but only by living the life of a railroad worker. • Central Pacific hired Chinese immigrants, Union Pacific hired Irish Immigrants & out of work Civil War Veterans to lay track. • Treacherous terrain, Native American attacks, Accidents and diseases disabled and killed thousands of men.

15. RAILROAD TIME • Each area worked on its own time, with noon when the sun was directly overhead. • Boston 12 min. later than New York • Travel from Maine to California, reset watch 20 times. • C.F. Dowd proposed the earth’s surface be broken into 24 time zones, one for each hour of the day. • US contained Eastern, Central, Mountain, and Pacific zones • November 18, 1883, watches were synchronized across the country. • 1884 an international conference set world wide time zones that incorporated railroad time. • 1918, Congress adopts railroad time as the standard for the nation.

17. OPPORTUNITIES AND OPPORTUNISTS • Railroads influences industries and business • Iron, Coal, Steel, Lumber, & Glass industries grew rapidly trying to keep pace with the railroads’ demands for materials. • Railroads also contributed to the growth of towns, establishment of new markets, and offered opportunity for visionaries and profiteers.

18. NEW TOWNS AND MARKETS • Railroads linked previously isolated cities, towns, and settlements promoting trade and interdependence. • Railroads supplied nationwide network allowing individual towns to specialize in particular products. • Chicago – stockyards; Minneapolis – grain industries • Cities prospered by selling huge quantities of their product to the whole country. • Cities grew along the rail lines: Abilene, Kansas; Flagstaff, Arizona; Denver, Colorado; Seattle, Washington.

19. PULLMAN • George M. Pullman built a factory for manufacturing sleepers and other railroad cars on the Illinois Prairie. • Pullman provided basic needs. Workers lived in clean, well built brick houses and apartment buildings with at least one window in every room. • Services offered – doctors’ offices, shops, athletic field • Pullman was a town under company control to hopefully ensure a stable work force. • Pullman’s refusal to lower rents after cutting his employees’ pay led to a violent strike in 1894.

20. CREDIT MOBILIER • Construction company formed in 1864. • Stockholders gave this company a contract to lay track at two to three times actual cost, and pocketed the profit. • Officers of the Union Pacific took up to $23m in stocks, bonds, and cash. • Vice-President Schuyler Colfax & Congressman James Garfield • Figures kept their profits but the reputation of the Republican Party was tarnished.

21. THE GRANGE AND THE RAILROADS • Farmers were disturbed by railroad corruption. • Grangers – members of the Grange – demanded government control over the railroad industry.

22. RAILROAD ABUSES • Farmers were angry at railroad companies for many reasons. • Misuse of government land grants – railroads sold the land to other businesses rather than to settlers. • Entered into formal agreements to fix prices, which kept farmers in debt. • Charged different customers different rates. • More $ for short hauls for which there was no alternative carrier. • Long hauls cheaper b/c there were alternative carriers.

23. GRANGER LAWS • Grangers took political action in response to railroads. • Sponsored state & local political candidates, elected legislators and pressed for laws protecting their interests. • 1871 Illinois commission “to establish maximum freight and passenger rates & prohibit discrimination. • Called these types of laws, Granger Laws. • Railroads fought back challenging the regulatory laws. • 1877, Munn v. Illinois, Supreme Court upheld Granger Laws • States won the right to regulate the railroads for the benefit of farmers and consumers. • Grangers help establish principle – the federal government’s right to regulate private industry to serve the public interest.

24. INTERSTATE COMMERCE ACT • 1886, Supreme Court ruled a state could not set rates on interstate commerce coming in or from another state. • 1887, Congress passed the Interstate Commerce Act. • Act established the right of the federal government to supervise railroad activity and established a five-member Interstate Commerce Commission (ICC). • ICC had difficulty regulating railroad rates b/c of long legal battles and railroad resistance. • 1897, Supreme Court ruled the ICC could not set maximum railroad rates. • 1906, ICC gained the power it needed to be effective under the Presidency of Theodore Roosevelt.

25. PANIC AND CONSOLIDATION • Corporate abuses, mismanagement, overbuilding, and competition pushed many railroads to the brink of bankruptcy. • Railroad financial problems played a role in the nations economic collapse. • Panic of 1893: by the end of the year 600 banks & 15,000 businesses failed. • Middle of 1894, quarter of the nations railroads had been taken over by financial companies. • 1895, 4m people lost their jobs. • 20th century: seven powerful companies held sway over two-thirds of the nation’s railroad tracks.

26. Section 3“Big Business and Labor” • CARNEGIE’S INNOVATIONS • 1873, after touring a British steel mill and witnessing the Bessemer Process, Carnegie entered the steel business. • 1899, Carnegie Steel Company manufactured more steel than all the factories in Great Britain.

27. NEW BUSINESS STRATEGIES • Carnegie’s success was due to his management practices. • Searched for ways to make better products more cheaply • Incorporated new machinery and techniques such as accounting systems to enable him to track precise costs • Attracted talented people by offering stock in the company • Encouraged competition among his employees • Vertical Integration – a company’s taking over its suppliers and distributors and transportation systems to gain total control over the quality and cost of its products. • Horizontal Integration – the merging of companies that make similar products

28. SOCIAL DARWINISM AND BUSINESS • Carnegie explained his success by pointing to his hard work, shrewd investments, and innovative business practices. • Philosophers explained his success as a new scientific theory of – Social Darwinism

29. PRINCIPLES OF SOCIAL DARWINISM • Derived from Charles Darwin’s theory of evolution • Darwin – “some individuals of a species flourish and pass their traits along to the next generation, while others do not.” • “Natural Selection” – weeded out less suited individuals and enabled the best-adapted to survive. • Regulation of the marketplace? • William G. Sumner promoted the theory that success and failure in business were governed by natural law and that no one had the right to intervene.

30. A NEW DEFINITION OF SUCCESS • 4,000 millionaires emerged since the civil war. • The theory supported the notion of individual responsibility and blame. • Theory appealed to Protestant work ethic of Americans. • Social Darwinism – riches were a sign of God’s favor, and therefore the poor must be lazy or inferior people who deserved their lot in life.

31. FEWER CONTROL MORE • Business owners in theory endorsed “natural law” but in practice most did everything they could do to control the competition that threatened the growth of their business empires.

32. GROWTH AND CONSOLIDATION • “If you can’t beat ‘em, join ‘em” • Most industrialists pursued horizontal integration in the form of mergers or when one corporation bought out the stock of the other. • If a firm bought out all of its competitors, it could achieve a monopoly, or complete control over its industry’s production, wages, and prices. • How to build a monopoly? Set up a holding company! • J.P. Morgan bought Carnegie Steel, became world’s largest business. • John D. Rockefeller, Standard Oil Company, joined with competing companies in trust agreements. • Trust participants turned their stock over to trustees – people who ran the separate companies as one large corporation. • Companies were entitled to dividends on profits earned by the trust. • Trusts were not legal mergers. • Rockefeller used a trust to gain total control of the oil industry in America.

33. ROCKEFELLER & THE “ROBBER BARONS” • Rockefeller reaped huge profits by paying his employees extremely low wages and driving his competitors out of business by selling his oil at a lower price than it cost to produce it. • When he controlled the market he then increased the prices far more than original levels. • This process brought about the term “Robber Barons” • Rockefeller gave away over $500m, establishing the Rockefeller Foundation, funds to found the Univ. of Chicago, & created a medical institute that helped find a cure for yellow fever. • Carnegie donated about 90% of his wealth during his lifetime; still supports the arts and learning today. • “It will be a great mistake for the community to shoot the millionaires, for they are the bees that make the most honey, and contribute most to the hive even after they have gorged themselves full.”

34. SHERMAN ANTITRUST ACT • Government was concerned that expanding corporations would stifle free competition. • 1890, Sherman Antitrust Act made it illegal to form a trust that interfered with free trade between states or with other countries. • If firms felt pressure from the government they simply reorganized into single corporations. • Government stopped trying to enforce the Sherman Act, and the consolidation of business continued.

35. BUSINESS BOOM BYPASSES THE SOUTH • Industrial growth concentrated in the North, the South was still trying to recover from the Civil War and had a lack of capital to spend. • Northern businesses owned 90% of the stock in the southern railroads, thus keeping the South in a stranglehold. • South remained mostly agricultural and at the mercy of the railroad rates. • Entrepreneurs suffered from excessive transportation costs, high tariffs on raw materials and imported goods, and a lack of skilled workers. • Growth in forestry, mining, tobacco, furniture, and textile industries offered hope for the South to come out of economic stagnation.

36. LABOR UNIONS EMERGE • Northern wages were generally higher than Southern wages, exploitation and unsafe working conditions drew workers together across regions in a nationwide labor movement. • Laborers – skilled and unskilled, female and male, black and white, - joined together in unions to try to improve their lot.

37. LONG HOURS AND DANGER • 7-day workweeks, 12 hours a day • Employees not entitled to vacation, sick leave, unemployment compensation, or reimbursement for injuries suffered on the job. • Dirty, poorly ventilated factories, workers had to perform repetitive, mind dulling tasks, sometimes with dangerous faulty equipment. • 1882, average of 675 laborers were killed in work-related accidents each week. • Wages were so low, families could not survive unless all members held a job. • 1890, 4m women – 1910, 8m women working. • 20% of boys and 10% of girls under age 15, some as young as 5, held full time jobs.

38. LONG HOURS AND DANGER • Sweatshop employment was often the only work available to women and children because it did not require skills. • Jacob Riis – “The bulk of the sweater’s work is done in the tenements, which the law that regulates factory labor does not reach …. In them the child works unchallenged from the day he is old enough to pull a thread. There is no such thing as a dinner hour; men and women eat while they work, and the day is lengthened at both ends far into the night.” • Sweatshops paid the lowest wages – 27 cents for a child’s 14 hour work day. • 1899, women earned average $267 while men earned average $498. • 1900, Andrew Carnegie made $23m with no income tax.

39. EARLY LABOR ORGANIZING • 1866, National Labor Union (NLU) founded by William H. Sylvis. • Colored National Labor Union (CNLU) • 1868, NLU persuaded Congress to legalize an 8-hour work day for government workers. • Noble Order of the Knights of Labor – “an injury to one is the concern of all” • Membership in the Knights was officially open to all workers regardless of race, gender, or skill level. • Knights supported 8-hour workday. • Advocated “equal pay for equal work” - men and women

40. UNION MOVEMENTS DIVERGE • CRAFT UNIONISM • Included skilled workers from one or more trades. • Samuel Gompers led Cigar Makers’ International Union to join w/ other craft unions in 1886. • American Federation of Labor (AFL) focused on collective bargaining, or negotiations between representatives of labor and management, to reach written agreements on wages, hours, and working conditions. • AFL used strikes as a major tactic. • From 1890 to 1915, average weekly wages in unionized industries rose from $17.50 to $24, and the average workweek fell from almost 54.5 hours to just under 49 hours.

41. INDUSTRIAL UNIONISM • Eugene V. Debs formed American Railway Union (ARU) formed with skilled and unskilled workers in the industry. • 1894, won a strike for higher wages. • 2-months its membership climbed to 150,000, dwarfing the 90,000 of the other four skilled railroad unions. • Like the Knights of Labor, the ARU never recovered from a failed strike, but did add to the momentum of union organizing.

42. SOCIALISM AND THE IWW • Debs and other labor activists turned to socialism – economic and political system based on government control of business and property and equal distribution of wealth – to solve the problems faced by workers. • 1905, Industrial Workers of the World (IWW) organized by a group of radical unionists and socialists. • IWW included miners, lumberers, cannery and dock workers. • Welcomed African Americans, but never topped 100,000 • Like other unions, IWW gave dignity and a sense of solidarity to unskilled workers.

43. OTHER LABOR ACTIVISM IN THE WEST • 1903, approximately 1,000 Japanese and Mexican workers organized a successful strike in the sugar beet fields of Ventura County, California. • Formed the Sugar Beet and Farm Laborers’ Union of Oxnard. • Wyoming, State Federation of Labor supported a union of Chinese and Japanese miners who sought the same wages and treatment as other union miners. • These small independent unions increased both the overall strength of labor movements and the tension between labor and management.

44. STRIKES TURN VIOLENT • Industry and government responded forcefully to union activity, which they saw as a threat to the entire capitalist system. • THE GREAT STRIKE OF 1877 • 1877, railroad workers in Baltimore and Ohio struck to protest their second wage cut in two months. • Freight and passengers were stopped for more than a week. • State Governors asked President Rutherford B. Hayes to intervene, saying the strikers were impending interstate commerce, federal troops ended the strike.

45. THE HAYMARKET AFFAIR • May 4, 1886 – 3,000 people gathered at Chicago’s Haymarket Square to protest police brutality; striker had been killed and several wounded at the McCormick Harvester plant the day before. • Bomb was thrown into the police line; police opened fire and seven police officers and several workers died. • After Haymarket, the public began to turn against the labor movement.

46. THE HOMESTEAD STRIKE • June 29, 1892 – Carnegie Steel Company, steelworkers called a strike after the company president, Henry Clay Frick, announced his plans to cut wages. • Frick hired armed guards from Pinkerton Detective Agency to protect the plant so he could hire strikebreakers to keep the operation going. • Steelworkers forced out the Pinkertons and kept the plant closed until the Pennsylvania National Guard arrived July 12. • Strike lasted till November, but by then the union had lost its support and gave in to the company.

47. THE PULLMAN COMPANY STRIKE • Panic of 1893, Pullman company laid off more than 3,000 of its 5,800 employees and cut the wages of the rest by 25-50% without cutting the cost of employee housing. • After rent workers took home < $6 a week. • 1894, Pullman strike. Pullman failed to restore wages or lower rent. • Debs asked for arbitration but Pullman refused. • ARU began boycotting Pullman trains. • Pullman hired strikebreakers and violence ensued. • President Cleveland had to send in federal troops. • Debs was jailed, most strikers were fired, and the railroad blacklisted many.

48. WOMEN ORGANIZE • Mary Harris Jones, most prominent female organizer of the women’s labor movement. • Organized for the United Mine Workers of America • 1903; Jones led 80m children, many with hideous injuries, on a march to the home of President Theodore Roosevelt. Her crusade influenced the passage of child labor laws. • 1909; Pauline Newman, 16, became the first female organizer of the International Ladies’ Garment Workers’ Union. • March 25, 1911; Triangle Shirtwaist Factory fire. 146 women died.

49. MANAGEMENT AND GOVERNMENT PRESSURE UNIONS • Unions got stronger, Employers feared them. • Management refused to recognize Unions. Many forbade union meetings. • Industrial Leaders with the help of the courts, turned the Sherman Antitrust Act against labor. • Company had to say a strike, picket line, or boycott would hurt interstate trade, and the state or federal government would issue an injunction against the labor action.