THE RISE OF INDUSTRIAL AMERICA, 1865–1900

1. THE RISE OF INDUSTRIAL AMERICA, 1865–1900 AP US History East High School Mr. Peterson Spring 2011

2. Focus Questions • What innovations in technology and business drove increases in industrial production after 1865? • How did Carnegie, Rockefeller, and other corporate leaders consolidate control over their industries? • Why did the South’s experience with industrialization differ from that of the North and the Midwest? • How did the changing nature of work affect factory workers’ lives, and how did they respond? • How did corporations undercut labor’s bargaining power in the 1890s?

3. The Rise of Corporate America

4. The Character of Industrial Change • Large-scale manufacturing • Large coal deposits • Technological innovation • Demand for workers who could be controlled • Constant pressure to cut costs and prices • Relentless drop in prices • Money supply shortage leads to high interest rates

5. p. 538

6. Railroad Problems and Innovations • 193,000 miles by 1900 • Collis Huntington, Jay Gould and others need capital • Land and loan subsidies from all levels of government • Bonds and stock to public • High levels of debt by 1900 • Magnetic telegraph • New organizations and accounting

7. Consolidating the Railroad Industry • Large companies buy up smaller ones • Divide country into 4 time zones • Standard gauge track • Relied on shipping rate cuts • Interstate Commerce Act (1887) • Oversee railroads • Banned monopolistic activity • Banker J. Pierpont Morgan gets control of many railroads

8. Applying the Lessons of Railroads to Steel • Andrew Carnegie • Rags to riches story • Builds own steel mill • Uses Bessemer process • “watch the costs, and the profits will take care of themselves” • Vertical integration • Could see big picture

9. p. 539

12. p. 539

13. Fig. 18-2, p. 541

14. Table 18-1, p. 541

15. The Trust: Creating New Forms of Corporate Organization • Consolidation in many industries • Oligopolies • Petroleum drilled in 1859 • Edwin Drake • Titusville, PA • “crude-oil” distilled • Lubricants, kerosene

18. John D. Rockefeller • Took over competition in oil industry • Lower prices • Set up pool of companies, trust • Standard Oil Trust • 90% of oil refining capacity • Integrated oil industry vertically and horizontally

20. James B. “Buck” Duke • Cigarette industry • American Tobacco trust • Targeted young with trading cards and prizes

22. p. 541

23. Sherman Anti-Trust Act • 1890 • Outlawed trusts and monopolies • Ineffective • Failed to define trust or restraint of trade • United States v. E.C. Knight (1895) • Manufacturing not interstate commerce

24. Stimulating Economic Growth

25. The Triumph of Technology • New inventions • Streamlined manufacturing • Stimulated consumer demand • Singer Sewing Machine Company • Alexander Graham Bell-telephone

26. Thomas A. Edison • “invention factory” • Phonograph- “sound writer” • Incandescent light bulb • Electric power system • Motion picture camera • Menlo Park laboratory • Model for other businesses

27. p. 543

28. Electricity • Thomas Edison • Interrelated system of power plants, transmission lines, light fixtures • Direct current-DC • George Westinghouse • Alternating current-AC • Systems combine-110 AC • Private ownership, regulated monopolies

29. p. 544

30. p. 545

31. Specialized Production • Manufacturing • Skilled workers • Seamstresses • Shift styles quickly

32. p. 546

33. Advertising and Marketing • Mass-produced consumer goods • Flour, soap, matches, canned goods • Brand names, trademarks, guarantees, slogans, endorsements, unique products • Demand and brand loyalty

34. p. 547

35. Social and Environmental Costs and Benefits • Social benefits • Labor-saving products • Lower prices • Advances in transportation and communications • Social costs • Bankrupt companies and dreams • Expendable workers • Environmental devastation

36. p. 548

37. The New South

38. Obstacles to Economic Development • Lagging industrial development • Lack of capital • Few banks • Growing cash crops such as cotton or tobacco made farmers vulnerable to world markets • Limited funds for education

39. The New South Creed and Southern Industrialization • Henry Grady • Atlanta Constitution • Industrialize South • Attract Northern capital • More opportunities for black workers in industry

40. The Southern Mill Economy • Mill towns supported textile industry • Center of textiles by 1920 • Augusta, GA: Lowell of the South • Low wages • Often paid in company scrip • Did little to help farmers/sharecroppers

41. The Southern Industrial Lag • Birmingham (AL) Steel controlled by U.S. Steel • Higher prices, despite lower costs • Segregated work force • Environmental damage

42. p. 550

43. Factories and the Work Force

44. From Workshop to Factory • Restructuring of work habits • Emphasis on workplace discipline • Example of shoemakers • Skilled artisan to unskilled factory worker • Lower-paid women and children

45. p. 555

46. The Hardships of Industrial Labor • High demand for unskilled laborers • Workers often drifted • 12-hour shifts • Dangerous work • Children as young as 8 • Railroads dangerous for adults • Minimal financial aid for disabled and families

49. Immigrant Labor • French Canadians in NE • Chinese in West • Eastern and Southern European immigrants • Subject to discipline and eviction from company provided homes • Faced discrimination

50. p. 559