AMERICAS INDUSTRIAL
SUPREMACY
Chapter 17
1870-1900: Unprecedented Progress
in Industry Marked by Unequal
Prosperity
Causes & Sources of Industrial
Growth
Advantages of U.S. Industry
Huge supply of raw materials
Large (and growing) labor force
Technological innovations allowed production
to be more efficient and quicker
Generation of Entrepreneursa group (of
mostly men) who were energetic, and willing
to take risks to make it big
What type of risks were they taking?
Expanding Domestic Market (which will soon
turn to a world market)
Industrial Technologies
Communications
TelegraphTransatlantic Telegraph completed
in 1866
Connected the U.S. to Europe with instantaneous
intercontinental communication
Later would be used to transmit telephone
signals, then television, then data.
Industrial Technologies
Communications
Commercial
telephone
technology
Alexander Graham
Bell, 1876
Telephone turned
communication from
graphic, to auditory
Industrial Technologies
Communications
Early Radio
First time instantaneous mass communication
was possible
What are radios main benefits?
Typewriter
Cash Register
Adding Machinecalculator
Industrial Technologies
Electricity (1870s)light and power
Thomas Edison invents the incandescent light
bulb in 1879
How does this invention change life as
Americans knew it?
Power plants begin to be built bringing
electricity to businesses and homes
Where did electricity go to first?
Who was the first to use electricity?
How did electricity effect the American
Economy?
Steam technology also becomes more
efficient which helped lower rail shipping
Iron and Steel
Steel
Steel first developed and produced in Pennsylvania
and Ohio
Made from iron ore being shipped to factories in
steam engine trains.
Steel is a metal alloy stronger, lighter, more
durable metal than iron
More things can be made from it
It is easier to work
Bessemer/Kelly Processcreates stronger steel by
blowing air threw molten metal to get out the
impurities.
Allowed the steel industry to develop because people
wanted steel over iron.
The Railroads
Railroads contribute to economic growth by:
Providing mass transportation cheaply
Increasing access to distant sources of raw materials
Provides access to previously inaccessible markets (the West)
Promotes the construction business.
Governments subsidized the building of railroads after
the Civil War. Why?
Concentration of power among the very few James J.
Hill, and Cornelius Vanderbilt.
Stockholders become rich and powerful
Limited Liability of the railroads protect themselves
from labor issues, safety regulations, etc., through
political lobbying.
The Corporation
Corporations become the main element
and cause of industrial development.
WHY?
TAYLORISMnew method of business
management that stressed a focus on
using math to develop and plan the
production process.
Led to:
The assembly line, scientific management, mass
production, and the subdivision of labor.
The Corporation
Managerial Techniques
developed
Corporate
hierarchylevels of
employees
Division of responsibilities among
the labor force
Cost accountingthe investment of
capital and the beginning of companies
making money off of money
Middle managers within the
corporate structure change the way
The Corporation
CONSOLIDATIONThe creation of massive
corporations
HORIZONTAL INTEGRATION Combining many firms in the
same business into a single corporation
Example: McDonalds, Burger King, Hardees, and Wendys consolidate
into one company.
VERTICAL INTEGRATIONTaking over all facets of
production: Supply, production, transportation, sales, etc.
Example: U.S. Steelbuys mines, railroads, and steel production
facilities to control their own operating costs
Standard OilJohn D. Rockefeller, starts by buying small oil firms, then
buys companies that produce and build oil drilling and refining
equipment, then branches out to other resources.
The Erie War 1868 Erie Railroad built with public funds
then was taken over by private citizen, stock manipulated by
railroad tycoons to buy out the Erie to create a monopoly
Monopolies
MONOPOLIESwhen consolidation completely
eliminates competition.
People disliked monopolies because they:
eliminated jobs
drove up prices
and consolidated power to the very few
Three kinds of Monopolies
TRUSTSstocks
transferred to a holding group that
combines investments
Trustees (people who own the stocks) use wealth to consolidate businesses
example: Standard Oil
Results of trusts and holding companieseconomic power held by the few
(trustees)
HOLDING
COMPANIES
where one company owns the majority of
another company by buying their stocks.
POOLS when large sums of money from multiple investors are used to
control an industry through one trustee
Capitalism and its Critics
Many people dont like the new industrial age
Industrialists counter with Survival of the
Fittest
Individuals given opportunity to succeed and gain
wealth in the industrial system
Self-made men
Tycoons
This idea was called SOCIAL DARWINISM
In human society only the most fit individuals survive in
the market place
Celebrates competition and the open market
Created by Herbert SpencerSociety benefits from the
elimination of the unfit.
The Gospel of Wealth
The idea that a rich person should be
a trustee of wealth and should use
those funds for public benefit.
(Carnegie)
people with great wealth are responsible for
the progress of society
The Ordeals of the Worker
Era marked by progress in standard of livingyet,
danger, less control, less power for regular individuals
Southern Blacks, foreign immigrants, eastern farmers,
and young rural woman migrated to the industrial city
after the Civil War.
The Immigrant Work Force
influx greater than any other era25 million (Civil War to WWI)
Usually became unskilled workers
Created close-knit ethnic communities (China Town, Little Italy,
etc.)
Germans and Jews were the most successful immigrants. Why?
Harsh
working conditions
routine, strict schedule, monotony, impersonality, long hours
women and children tapped for laborunskilled
child labor laws in responseoften ignored
The Ordeals of the Worker
Emerging Unionization
Generally
unsuccessful during the erabut small steps taken
public hostility and recession years undermine the movement
Railroad
Strike of 1877U.S.s first major national labor conflict
RR announces 10% pay cutrioting, looting, sabotage in response
State militias and fed troops put down widespread rioting
Scores of RR workers killedpotential strength for unions?
Who does the government/courts support?
The Knights of Labor
The
first effort to create a truly national labor organization
Uriah S. Stephens as founderopen to all, inc. women and African-Americans
Focus:
workday, child labor, but also economic reform and wage
restructure
Initial success (700 k in 1886)repression and violence
undermine organizing the union
The Ordeals of the Worker
The American Federation of Labor (AFL)
National
labor union formed in 1886 whose goal was to
organize skilled labor by craft to affect change in
management, pay, and working conditions.
Rivaled Knightscollection of autonomous craft unions
skilled workers
Haymarket Square Bombing (May, 1886) radicals
protest death of strikers
ordered to disperse, unknown throws bomb police
killed/wounded
police fire into crowd, kill several protesters
trial of anarchists who organized protestseven sentenced to
death
becomes symbol of social chaos and radicalismanarchism
decried
The Ordeals of the Worker
The Homestead Strike (1892)
Amalgamated Association of Iron and Steel Workers
Most powerful trade unionskilled, high demandsignificant power
Henry Clay Frickchief lieutenant of Andrew Carnegie
Amalgamated Association had to gowages cut, union ignored
Strike called for (actually a lockout of unionists)
Strikebreakers (scabs) called in, protected by security
specialistsPinkertons
Pitched battle occurs, several killedPinkerton
Detectives flee
National Guard intervention and attempt on Fricks life
sway public opinion
The Ordeals of the Worker
The Pullman Strike (1894)
Pullman
Palace Car Company (Chicago)company
town for workers
George M. Pullman envisions town as solution to labor conflicts
marked by regimentation and high rent
citing
depression, wages slashed by 25%--rent remains
high
American Railway Movement (Eugene V. Debs) organize strikes
Thousands strike across 27 statesChicago to Pacific paralyzed
State
refuses militiafederal troops move in (mail)
injunction ordered
Arrests of union leaders and federal protection help to
collapse strike
The Ordeals of the Worker
Sources of Labor Weakness
Few
gains for labor despite organizing efforts
Perhaps less political power and less control of workplace?
Reasons
for weaknessadvantages lie with capital
Main labor organizations represent only a small % of workers
Divisions within workforcetensions among ethnic groups
fluid nature no long term plans for most workersmigration
corporate organization of vast wealth and power
determined to crush resistance
support of authorities to preserve order
public opinion bristles at militants and radicals
rugged individualism, bravery, courage not compatible with
unions?
