Chapter 14: Industry and Railroads
The Main Idea
ñ During the late 1800s, new technology led to rapid industrial growth and the expansion of railroads.
Reading Focus
ñ What new industries emerged in the late 1800s, and why were they important?
ñ Why did railroads expand, and what changes resulted?
New Industries Emerge
New technologies
ñ Electrical power replaced steam and water power.
◦ This change characterized the Second Industrial Revolution
ñ Larger factories produced more and more goods.
ñ Faster transportation moved people and goods more cheaply.
ñ Dramatic industrial growth
ñ Period sometimes called the Second Industrial Revolution
New Industries Emerge
Making steel
ñ The Bessemer process revolutionized the steel industry.
ñ Helped to make America the world’s top producer and transformed the U.S. into a modern industrial economy.
ñ Construction companies could build bigger bridges and taller buildings.
Oil industry begins
ñ Oil was a key commodity as a fuel source and for lubrication.
ñ Edwin L. Drake drilled the first successful oil well in Pennsylvania
ñ Oil prospectors, or Wildcatters, looked for oil in other regions.
ñ The oil boom at Spindeltop Texas caused a dramatic increase in oil production from 1900-1910
Railroads expand
More tracks
ñ Between 1865 and 1890, the number of miles of railroad track increased nearly fivefold. Aiding the growth, the federal government gave thousands of acres of land to railroad companies.
Union Pacific
ñ Laid tracks westward from Omaha, Nebraska
ñ In laying track for the Transcontinental railroad, the Union Pacific Railroad proceeded more quickly because it benefited from smoother terrain.
Central Pacific
ñ Tracks were laid eastward from Sacramento, California. Chinese workers laid tracks through tougher terrain, crossing deserts and blasting through mountains.
ñ Uniting the country physically and economically, the two rail lines met on May 18, 1869.
Import Effects
ñ The Transcontinental railroad was important because it promoted trade and provided jobs.
ñ Settlement of the West was easier, small areas began to fill with people. With railroads, new towns were founded and existing ones expanded.
ñ Railroads led to the adoption of standard time zones. Before, each area had its own local time based on the position of the sun.
ñ By 1918 standard time was adopted for the nation as a whole.
The Rise of Big Business
The Main Idea
ñ Corporations run by powerful business leaders became a dominant force in the American economy.
Reading Focus
ñ What conditions created a favorable climate for business during the late 1800s?
ñ How did business structures change?
ñ Who were the leading industrial tycoons, and what did they achieve?
ñ How did mass marketing change the way goods were sold?
A Favorable Climate for Business
ñ The American ideal was one of self-reliant individualism. A strong work ethic made one successful
Free markets
ñ With capitalism, most industries are run by private businesses.
ñ In the 1800s, business leaders believed in laissez-faire capitalism with no government intervention.
ñ They believed government regulation would destroy self-reliance, reduce profits, and harm the economy.
Social Darwinism
ñ Charles Darwin believed that members of a species compete for survival in a natural selection process.
ñ Believers in social Darwinism thought that weak and struggling business should never get assistance from the government
Business Structures Change
Proprietorships and partnerships
ñ Small businesses were run by individual proprietors or had more than one owner in a partnership. In either case, owners are personally responsible for all business debts and obligations.
Corporations
ñ Corporations are owned by stockholders decisions made by a board of directors, with day-to-day operations run by corporate officers
ñ One advantage of a corporation is the ability to raise money and the limited liability of stockholders
ñ Corporations and partnerships are similar in that they are held or owned by two or more people.
Trusts and Monopolies
ñ Some companies merged and turned their stocks over to a board of trustees who ran the group of companies as a single entity. Sometimes a trust gained a monopoly, having complete control of an industry. With no competition, prices could be raised or lowered at will. If a trust was completely successful, it would hold a monopoly.
Industrial Tycoons
Rockefeller and oil
ñ John D. Rockefeller bought barrel factories, oil fields, pipelines and railroad cars in an example of vertical integration.
ñ John D. Rockefeller became a famous for building his businesses through both horizontal and vertical integration.
Carnegie and steel
ñ Andrew Carnegie rose from immigrant child to steel magnate. He used profits from various business investments to found his own company. By the end of the century the Carnegie Steel Company dominated the U.S. steel industry.
ñ In Gospel of Wealth Carnegie explained his belief that great wealth was a resource to be used to benefit others.
Industrial Tycoons
Cornelius Vanderbilt
ñ Vanderbilt began investing in railroads during the Civil War. By 1872, he owned the New York Central Railroad. At the height of his career he controlled 4,500 miles of track.
ñ He supported few charities, but gave money to what would come to be Vanderbilt University. He died leaving an estate of $100 million.
George Pullman
ñ George Pullman made his fortune designing and building sleeper cars that made long-distance travel more comfortable.
ñ He built a town to house workers in relative comfort, believing happy workers were more productive.
ñ The town of Pullman, south of Chicago was notable because it was built and controlled by the Pullman Company
A Mixed Legacy
Critics
ñ Business tycoons were “robber barons” who profited unfairly by squeezing out competitors. They lived lavish lifestyles from their ill-gotten rewards.
Proponents
ñ Business tycoons were “captains of industry” who used their business skills to make the American economy more productive. That in turn made the American economy stronger.
Mass Marketing
ñ Retailers looked for new ways to maximize their profits.
ñ Household goods were targeted toward women, who made most of those purchasing decisions. Wholesome images were used to convey a sense of purity. Brand names helped customers remember products.
ñ Shopping became easier with the emergence of department stores
ñ The development of mail order catalogs benefited rural Americans
Workers Organize
The Main Idea
ñ Grim working conditions in many industries led workers to form unions and stage labor strikes.
Reading Focus
ñ What was the relationship between government and business in the late 1800s?
ñ What were working conditions like for industrial workers?
ñ How did workers seek change?
Government and Business
Hands-off policy
ñ Government did not interfere with business in the late 1800s, but as corporations expanded and gained power, that policy began to change.
Controlling the giants
ñ In 1890 Congress passed The Sherman Antitrust Act to promote competition and free trade.
ñ The Act made it illegal to form trusts that interfered with free trade. It prohibited monopolies and activities hindering competition.
ñ The law was vague, however, and it was seldom enforced.
Workers
ñ The government paid less attention to workers, who scraped by on small wages. By 1890, 10 percent of the population controlled 75 percent of the nation’s wealth. The rich were very rich, and the poor were very poor. A lot like today.
Industrial Workers
The workforce
ñ Many factory workers were immigrants or rural Americans moving to the cities for jobs.
ñ The best jobs went to native-born whites or European immigrants.
ñ Less well-paying jobs were open to African Americans, as household help or laborers.
ñ By 1900, one in six children between the ages of 10 and 15 held factory jobs.
Working conditions
ñ Most unskilled laborers worked 10-hour days, six days a week.
ñ They had no paid vacation and no sick leave.
ñ Speed of production led to terrible accidents. Injured workers were replaced.
ñ Sweatshops were common. These cramped workshops set up in shabby tenement buildings were common in the garment industry.
Workers Seek Change
Early organizing
ñ In 1794, Philadelphia shoemakers formed a trade union. Over decades, unions formed for skilled trade workers, but they remained small and local.
Nation Unions
ñ After the Civil War, things changed. The Knights of Labor formed in 1869. Under the leadership of Terence V. Powderly in the 1880s, they began to accept unskilled workers, women, and African Americans as members. They campaigned for reforms, such as eight-hour workdays and the end of child labor through boycotts and negotiations.
The Great Railroad Strike
ñ After wage cuts, the first railroad strike occurred in 1877. Initial strikes quickly spread, and state militias were called out. Violence ensued, lives were lost, and costly damage was done. The arrival of U.S. Army troops put an end to the strike.
Strikes and Turmoil
The Haymarket Riot
ñ 1886 was a difficult year for labor.
ñ One of the worst clashes was at Haymarket Square in Chicago. A bomb was thrown in a crowd gathered to protest violent police action. Gunshots rang out, and eleven people were killed and hundreds injured before it was over.
ñ Foreign-born unionists were blamed for the violence, and the press fanned xenophobia.
ñ Eight men were charged with conspiracy, but no evidence connected them to the crime.
ñ All eight were convicted and sentenced to death. After four hangings and one suicide, the last three were pardoned.
The American Federation of Labor
ñ Employers struck back at organized labor, forcing employees to sign documents saying they would not join a union.
ñ Blacklists of people deemed troublemakers were made and shared by employers, who refused to hire anyone listed.
ñ Striking workers were replaced with “scabs,” or strikebreakers.
ñ Samuel Gompers led a group of skilled workers to form the American Federation of Labor in 1886.
ñ Using strikes and other tactics, the AFL did win wage increases and shorter workweeks.
The Homestead Strike
ñ Unions made some gains, but conflicts continued. Carnegie Steel workers in Homestead, Pennsylvania, refused to work faster, and the manager tried to lock them out. The workers seized the plant. Gunfire erupted when private guards hired by the company tried to take control. After a 14-hour battle and fourteen deaths, the governor called out the state militia. The steelworkers’ union withered within months.
The Pullman Strike
ñ After laying off a third of its employees in 1893, the Pullman Company cut the wages of remaining workers by 25 percent without lowering their rents. Workers went on strike with the support of Eugene V. Debs, the leader of the American Railway Union. The government ordered the strike be called off, but the union refused. President Grover Cleveland called in federal troops, and the strike collapsed. The late 1800s would remain an era of big business.
The Age of Invention
The Main Idea
ñ Important innovations in transportation and communication occurred during the Second Industrial Revolution.
Reading Focus
ñ What advances in transportation were made in the late 1800s?
ñ What inventions led to a communications revolution?
ñ How did Thomas Edison help shape the modern world?
Advances in Transportation
ñ Streetcars were horse-drawn vehicles placed on rails on the street to make the ride smoother.
ñ Cable cars were invented in San Francisco to get cars up the steep hills there.
ñ Subways developed as a result of increased traffic from horses and electric streetcars competing for space. Boston built the first subway line in 1897, with New York City following in 1904.
ñ Mass Transit systems are public transportation systems that carry large numbers of people and make fixed stops along established routes.
Advances in Transportation
ñ Automobiles—The first practical motorcar in the U.S. was built in 1893. Automobiles were only for the wealthy; a new car cost about $2,500.
ñ Airplanes—Ohio bicycle makers Wilbur and Orville Wright were the first to successfully fly an airplane.
◦ The first true flight in an airplane took place on December 17, 1903 near Kitty Hawk, North Carolina–
Communications Revolution
The telegraph
ñ Samuel F. B. Morse patented his method of communicating by sending messages over wires with electricity, calling it the telegraph.
ñ Operators tapped out patterns of long and short messages that stood for letters of the alphabet. The system was known as Morse code.
ñ After the Civil War, the telegraph grew with the railroads. Telegraph wires were strung along the tracks, and train stations had telegraph offices in them.
The telephone
ñ Alexander Graham Bell gets the credit for the invention of the telephone in 1876.
ñ Companies found the telephone to be an essential business tool. People wanted to have them in their homes as well.
ñ By 1900, more than a million telephones had been installed across the nation.
The Typewriter
ñ Inventors in many nations made attempts to create a writing machine.
ñ Christopher Latham Sholes, a Milwaukee printer, developed the first practical typewriter in 1867. He later improved upon his machine by designing the QWERTY keyboard, still the standard on keyboards today. The most frequently used letters were placed far apart so they would not jam when they were struck.
ñ The typewriter could produce legible documents very quickly. Businesses began to hire women as typists to manage company correspondence, opening up new job opportunities for women.
Thomas Edison
Obsessed with progress
ñ As a child, Thomas Edison was curious about everything. Nearly deaf by twelve, he declared himself an inventor by age twenty-two. In 1886, he opened his own research laboratory in Menlo Park, N.J.
Hard work
ñ Edison said, “Genius is 1 percent inspiration, 99 percent perspiration.” He worked alongside his assistants and spent long hours tinkering with designs.
ñ Edison's attitude towards failures were that they were as valuable to him as success
Electric lighting
ñ Edison developed the practical electric lighting. With the incandescent bulb came the need for widely available electricity. Edison would bring electricity to New York City, designing and producing all of the parts necessary for an electricity network. Electric power plants spread across the country.