Chapter 14: a New Industrial Age

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Chapter 14: A New Industrial Age 1865-1901

Section 1: The Rise of Industry

American industry grew rapidly after the Civil War, bringing revolutionary changes to American society.

I. The United States Industrializes (pages 436-437)

A. With the end of the Civil War, American industry expanded and millions of people left their _________ to work in mines and factories.

B. By the early 1900s, the U.S. had become the world’s largest leading ________ nation. By 1914 the GNP, was eight times greater than at the end of the Civil War.

C. What was responsible for this growth?

-3 Factors That Led to the Industrial Boom:

1. A wealth of ________________________________.

2. A growing urban ___________________ that provided both cheap labor and markets for new products.

3. Government_____________ for business.

1st Factor Natural Resources: abundance of raw materials; vast natural resources that industry depended on; water, timber, coal, iron, and copper.

• These resources were here in America! Less __________ of resources now because America had them!

• Most of these resources were located in the mountains of the _________. The settlement of the West helped accelerate _________________, as did the transcontinental railroad by bringing settlers and miners to the West and moving resources back to the factories in the __________.

• *______________________- drilled the first oil well near Titusville, PA in 1859; oil production increased.

2nd Factor Large Workforce:

• Between 1860 and 1910, the population of the U.S. ____________. This provided a large workforce and a greater demand for consumer goods.

• Why the population growth? Large families and a flood of ____________________.

3rd Factor Government Support for business:

• __________________________ economics, popular idea in the late 1800s; government should not interfere with the economy. Supply and demand needed to regulate prices and wages.

• Profit motive = ___________________ increase; attracted to manufacturing and transportation fields. Result=hundreds of factories and thousands of miles of railroad built.

• _________________ investments( helped fund the nation’s industrial buildup.

• Laissez-faire = government low taxes and low spending; no regulations on industry = all policies to help industry.

• High tariff controversy? Is the U.S. ready to compete by the early 1800s freely with other nations or do we still nee a protective tariff?

II. New Inventions Promote Change: New inventions increased America’s productivity, which in turned produced wealth and job opportunities.

A. _____________________: 1844 telegraph to send messages; before telegraph horse and rider

B. Elias Howe: 1846 sewing machine

C. Elisha Otis: 1852 safety elevator kept elevator cars from suddenly falling

D. George Pullman: 1864 rail sleeping car

E. Thaddeus Lowe: 1865 ice machine

F. Gustavus Swift: invented refrigerated rail cars for transporting food

G. _________________________-:1876 invented telephone

H. _________________________: 1879 light bulb; electric generator, motion picture

The Power of Electricity

*Thomas Alva Edison- 1876 established the world's first research lab in New Jersey. There he perfected the incandescent light bulb, which was patented in 1880. He later invented an entire system for producing and distributing electrical power.

-The harnessing of electricity completely changed the nature of business in America.

Inventions Change Lifestyles

*Alexander Graham Bell and *Thomas Watson- 1876 invented the telephone, which opened the way for a worldwide communications network.

-Both the typewriter and the telephone created new jobs for women.

-In 1870 women made up 5% of the workforce -- by 1910 they counted for nearly ______of the clerical workforce.

Section 2: The Age of the Railroads

After the Civil War, the rapid construction of railroads accelerated the nation’s industrialization and linked the country together.

I. Linking the Nation

A. After the Civil War, railroad construction dramatically expanded. In 1862 President Abraham Lincoln signed the _______________________, which provided for the construction of a transcontinental railroad by the Union Pacific and Central Pacific railroad companies. To encourage rapid construction, the government offered each company land along its right of way.

B. In 1865 the Union Pacific, under engineer ____________________, pushed westward from Omaha, Nebraska. Weather, labor, money, and engineering problems hampered the project. The workers included Civil War veterans, Irish immigrants, farmers, miners, cooks, and ex-convicts. Camp life was dangerous.

C. Four merchants known as the _____________ invested in the Central Pacific Railroad. They each bought stock in the railroad and eventually made a fortune. One of them, Leland Stanford, became Governor of CA, founded Stanford University, and later became a U.S. Senator.

*___________________________________- in May 1869 the Central Pacific and the Union Pacific met in Utah to nail the Golden Spike that marked the nation's first cross-country railroad.

II. Railroads Spur Growth

A. ____________________ encouraged the growth of American industry. They linked the nation and increased the size of markets. The railroad industry stimulated the economy by spending large amounts of money on steel, coal, and timber (natural resources( )

B. ______________________: famous railroad consolidator

C. 1883 American Railway Association divided the country into ____ time zones, or regions. where the same time was kept = safety and more reliability = Eastern, Central, Mountain, and Pacific.

D. Large integrated railroad systems provided increased efficiency, a decrease in time spent in long distance travel, and it united Americans from different regions.

III. The Land Grant System

A. __________________________ were given to railroad companies by the federal government to encourage railroad construction.

B. Railroad companies like the Union Pacific and Central Pacific were able to cover all their building costs by selling land to settlers, real estate agencies, and other businesses.

IV. Robber Barons-The growth and consolidation of railroads benefited the nation, but also led to __________________ and required government regulation.

A. The wealth of railroad entrepreneurs led to accusations that they had acquired their wealth through illegal means. One of the entrepreneurs with the worst reputation was ______________, who used information he obtained as a railroad owner to manipulate stock prices to his benefit.

B. Railroad investors realized they could make more money through land grants than by running a railroad, so many investors bribed members of Congress to vote for more land grants.

C. In 1872 corruption in the railroad system became public with the _____________________ scandal. Several stockholders of the Union Pacific set up the Credit Mobilier, a construction company. The investors signed contracts with themselves. The company greatly overcharged Union Pacific, and the railroad agreed to pay the inflated bills.

D. When the railroad was completed, the investors had made a fortune, but the railroad was almost bankrupt. Congress agreed to give additional grants to the railroad after several members of Congress were given shares in Union Pacific at a price well below market value. An investigation implicated several members of Congress, including _________________________, who later became president( Union Pacific had taken up to $23 million in stocks, bonds, and cash.

E. Not all railroad entrepreneurs were corrupt. ___________________ built the Great Northern Railroad without any federal grants or subsidies. It became the most successful transcontinental railroad and the only one not to go bankrupt. (

Chapter 14, Section 3 Guided Reading Notes: Big Business

I. The Rise of Big Business: By 1900, big businesses dominated the economy.

A. The Role of Corporations

1. Big business would not have been possible without the corporation.

2. Corporation: an organization owned by many people but treated by law as though it were a single person.

3. Stockholders/Stocks

B. Economies of Scale:

1. Money from stock = investment of in new technologies, hiring a large workforce, and purchase of machines that increase efficiency

2. Economies of scale: corporations making goods cheaply because they produce so much so quickly using large manufacturing facilities.

3. Criticisms of corporations: using wealth to drive small companies out of business.

II. The Consolidation of Industry: To stop prices from falling (cut in their profits), many companies formed pools, or agreements to maintain prices at a certain level. Criticism: interfered with competition and private property rights. Companies that formed pools had no legal protection and could not enforce their agreements in court. Pools generally did not last long. Sooner or later competition resumed.

A. Andrew Carnegie and Steel:

1. Built first American steel mills to use the Bessemer Process: make high quality steel efficiently and cheaply.

2. Vertical Integration: (steel industry) company owns all of the different businesses on which it depends for its operation.

3. Horizontal Integration: (oil) combining many firms engaged in the same type of businesses into one large corporation. = monopolies; Rockefeller Standard Oil (buyouts)

4. Later monopolies would be outlawed by the Sherman Antitrust Act

III. Selling the Product:

1. Advertising Industry Rose: Woolworth’s; Sears, Roebuck

2. Mail-order catalogs, chain stores

Chapter 14, Section 4 Guided Reading Notes: Unions (the other side of the spectrum)

I. Working the United States:

A. Life for workers in industrial America was difficult.

B. Machines replaced skilled labor; work became monotonous. = little pride in one’s work.

C. Working conditions were unhealthy and dangerous. Workers breathed in dust, lint, and toxic fumes. High number of injuries.

D. Real wages rose ( Standard of living rose(

E. Uh-oh – Deflation: workers felt like they were being paid less money for the same amount of work. = many workers decided to organize.

II. Early Unions:

A. Trade Unions: unions limited to people with specific skills. Largest and most successful in 1873: Iron Molders’ International Union.

B. Employers were often forced to recognize and negotiate with trade unions because they represented workers whose skills they needed.

C. However, employers generally regarded labor unions as conspiracies that interfered with their property rights. They particurlaly opposed industrial unions: united all craft workers (special skills and training) and common laborers (few skills and received low wages).

D. Techniques used to stop labor unions:

a. Oaths and sign contracts promising not to join an union; hired detectives to go undercover and identify union organizers; blacklist: a list of “troublemakers”; lockout: locked workers out of the property and refused to pay them; hired strikebreakers.

E. Political and Social Opposition

a. Workers wanting to join a union faced several major problems:

1. No laws allowing workers the right to organize.

2. Owners were not required to negotiate with workers.

3. Courts frequently rules against them, referring to them as conspiracies.

4. Perception that they threatened American industries.

5. Marxism: basic force shaping capitalist society was the class struggle between workers and owners; workers would eventually revolt, seize control of the factories, and overthrow the gov’t; then gov’t would seize all private property and create a socialist society where all property would be evenly divided; leading to a Communist society.

6. Many labor supporters agreed with Marx, and a few even supported anarchism.

7. All of these ideas were driving forces in Euorpoean unions = immigrants = nativism = attempts at suppression of unions.

III. The Struggle to Organize

A. The Great Railroad Strike: Circle Map

B. The Knights of Labor: Circle Map

C. The Haymarket Riot: Circle Map

D. The Pullman Strike: Circle Map

IV. The American Federation of Labor

A. AFL: first leader Samuel Gompers: his approach helped unions become accepted in American society.

B. He believed that unions should stay out of politic; rejected socialist and communist ideas.

C. Gompers felt that the AFL should fight for small gains within the American system. Gompers was willing to use the strike method, but preferred negotiations.

D. AFL’s 3 main goals under Gompers leadership:

1. Tried to get companies to recognize unions and to agree to collective bargaining.

2. Pushed for closed shops: companies could only hire union workers.

3. Promoted an 8-hour workday.

V. Working Women

A. After Civil War women wage earners increased.

B. “women’s work” – teachers, nurses, sales clerks, domestic servants.

C. Light industrial jobs

D. Paid less than men; most unions, including the AFL excluded women.

E. Mary Kenney O’Sullivan and Leonora O’Reilly: decided to establish a separate union for women with the help of Jane Addams and Lillian Ward = WTUL

F. WTUL: pushed for creation of minimum wage, an end to evening work for women, and abolition of child labor.

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Section 3: Big Business and Labor

Carnegie's Inventions

*Andrew Carnegie- a millionaire who made his riches in the steel industry. By 1899, the Carnegie Steel Company manufactured more steel and all the factories in Great Britain.

-He attempted to control as much of the steel industry as he could.

*Vertical Integration- was a process in which he bought out his suppliers coal fields and iron mines, ore freighters, and railroad lines -- in order to control the raw materials and transportation systems. (A company buys out all of its suppliers).

-Carnegie also attempted to buy out competing steel producers. In this process, known as *Horizontal Integration- companies producing similar products merge.

Social Darwinism and Business

Principles of Social Darwinism- the philosophy grew out of the English naturalist Charles Darwin's theory of biological evolution.

-Has process of "natural selection" stated that only the fittest would survive.

*Laissez Fair- (a French term meaning "allow to do”) This theory justified the efforts of millionaires and discouraged government interference and big business.

-Riches were a sign of God's favor, and therefore the poor must be lazy or inferior people who deserved their lot in life.

Fewer Control More

*John D. Rockefeller- established the Standard Oil Company. He created trust to gain control of the oil industry in America.

-He would pay his employees low wages and sell this oil at lower prices than businesses could produce it for -- driving his competitors out of business. Then, when he controlled the market, he hiked up prices.

-His company went from refining 3% of the nation's oil in 1870 to refining 90% a decade later.

-Critics began to refer to the tactics of industrialists such as Rockefeller as *Robber Barons.

-Although Rockefeller kept most of his assets, he still gave away over $500 million, establishing the Rockefeller Foundation, providing funds to found the University of Chicago, and creating a medical institute that helped find a cure or prevent yellow fever.

*Sherman Antitrust Act- 1890, made it illegal to form a trust that interfered with free trade between states or with other countries. Finding it hard to enforce the act, the consolidation of businesses continued.

-As business boomed in the north, the south was still trying to recover from the Civil War. However, growth industries in mining, and in the tobacco, furniture, and textile industries offered hope.

Section 4: Labor Unions Emerge

Long Hours and Danger

-7 day work week -- 12 hour days -- no vacation or sick leave -- no unemployment compensation or reimbursements for injuries suffered on the job.

-Injuries were common. Many caused by dangerous or faulty equipment.

-Wages: sweatshops- $.27 for 14 hour day. In 1899 women earned $267 a year, while men earned $498 year.

Early Labor Organizations

*National Labor Union (NLU)- 1866, the refusal of some NLU local chapters to admit African Americans led to the *Colored National Labor Union (CNLU).

-In 1868 that NLU persuaded Congress to legalize the eight-hour workday for government workers.

Union Movements Diverge

-2 major types of unions made great gains under forceful leaders.

-Craft Unions- included skilled workers from one or more trades.

*Samuel Gompers- led the Cigar Makers International Union to join with other craft unions in 1886.

*The American Federation of Labor (AFL)- with Gompers as its president, it focused on collective bargaining, or negotiation between representatives and labor-management to reach written agreements on wages, hours, and work conditions.

-The AFL use strikes as a major tactic.

-Industrial Unionism- unions that included all laborers-skilled and unskilled, in a certain industry.

*Eugene V. Debs- formed the American Railway Union (ARU).

*Industrial Workers of the World (IWW)- the Wobblies, headed by William "Big Bill" Haywood, included minors, lumberers, and cannery and dockworkers.

-It was organized by a group of radical unionists and socialists in Chicago in 1905 and it welcomed African-Americans, unlike the ARU.

Strikes Turned Violent

-Industry and government respond forcefully to union activity, which they saw as a threat to the entire capitalist system.

*The Great Strike of 1877- railroad workers struck over a second pay cut. Federal troops were sent in to end the strike.

*The Haymarket Affair- May 1886, 3,000 people gathered at Chicago's Haymarket Square to protest police brutality -- a striker had been killed and several had been wounded at a plant the day before.

-Then someone threw a bomb into a police line and the police fired back. After this incident, the public began to turn against the labor movements.

*The Homestead Strike of 1892- over working conditions and a pay cut at the Carnegie Steel Company’s Homestead Plant in PA.

-The National Guard was called in to put it down. After this, it would take 45 years for steelworkers to mobilize once again.

*Pullman Company Strike- during the panic of 1893, Pullman cut wages and laid people off but never cut the prices on employees housing. After paying the rent, workers took home less than $6 a week.

-The strikes turned violent and federal troops were sent in.

-Debs was jailed and most of the strikers were fired and blacklisted from working at other railroad jobs.

Women Organize

*Mary Harris Jones- organized the United Mine Workers of America (UMW). Nicknamed Mother Jones, she led 8 million children, many with hideous injuries, on a march to the home of President Teddy Roosevelt. This helped pass some child labor laws.

*The Triangle Fire- 1911, at the Triangle Shirtwaist Factory in New York City.

-The company had locked all but one of the exit doors and the one that was unlocked was blocked by fire. There was no sprinkler system and the single fire escape collapsed killing 146 women.

-Public outrage flared after this -- New York set up a task force to study factory-working conditions.

Management and Government Pressure Unions

-The more powerful the unions became, the more employers came to fear them.

-Many employers would make their employees sign *Yellow Dog Contracts- swearing they would not join a union.

-The industrial leaders, with the help of the courts, turned the Sherman Antitrust Act against labor. All the company had to do was say that a strike, picket line, or boycott hurt the interstate trade, and the state or federal government would issue an injunction against the labor action.

-These legal limitations made it more and more difficult for unions to be effective.

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