The Incorporation of America APUSH – CH 19

Rise of Industry Pages  Causes of Industrialization  Role of the Railroads  New Business Models

Causes of Rapid Industrialization 1. Steam Revolution of the 1830s-1850s. 2. The Railroad fueled the growing US economy: * First big business in the US. * First big business in the US. * A magnet for financial investment. * A magnet for financial investment. * The key to opening the West. * The key to opening the West. * Aided the development of other industries. * Aided the development of other industries. 1. Steam Revolution of the 1830s-1850s. 2. The Railroad fueled the growing US economy: * First big business in the US. * First big business in the US. * A magnet for financial investment. * A magnet for financial investment. * The key to opening the West. * The key to opening the West. * Aided the development of other industries. * Aided the development of other industries.

3. Unskilled & semi-skilled labor in abundance. 4. Abundant capital. 5. New, talented group of businessmen [entrepreneurs] and advisors. 6. Market growing as US population increased. 7. Government willing to help at all levels to stimulate economic growth. 8. Abundant natural resources. 3. Unskilled & semi-skilled labor in abundance. 4. Abundant capital. 5. New, talented group of businessmen [entrepreneurs] and advisors. 6. Market growing as US population increased. 7. Government willing to help at all levels to stimulate economic growth. 8. Abundant natural resources. More Causes of Rapid Industrialization

Railroad Construction

Age of Railroads  Transcontinental Railroad – 1869 Union Pacific and Central Pacific RailroadsUnion Pacific and Central Pacific Railroads Harsh work conditionsHarsh work conditions  Time problems No standard time zonesNo standard time zones  Opportunities Nationwide network of suppliers and marketsNationwide network of suppliers and markets New towns and communitiesNew towns and communities Expanded travel and settlementExpanded travel and settlement

What time is it?  Eastern Standard Time = +1 hour  Central Standard Time = NOW!  Mountain Standard Time = -1 hour  Pacific Standard Time = -2 hours

Railroad Problems  Corruption Credit Mobilier – company inflated costs to build railroads – paid off CongressmenCredit Mobilier – company inflated costs to build railroads – paid off Congressmen Price fixing against farmersPrice fixing against farmers  Overbuilding  Non standard gauges / iron vs. steel rails  Competition  Lack of government regulations

Cornelius [“Commodore”] Vanderbilt Can’t I do what I want with my money?

William Vanderbilt $ The public be damned! $ What do I care about the law? H’aint I got the power? $ The public be damned! $ What do I care about the law? H’aint I got the power? #2

New Business Culture Laissez Faire  the ideology of the Industrial Age. * Individuals should compete freely in the marketplace. * Individuals should compete freely in the marketplace. * No room for government in the market! * No room for government in the market! * Individuals should compete freely in the marketplace. * Individuals should compete freely in the marketplace. * No room for government in the market! * No room for government in the market!

New Type of Business Entities 1. Pool – a group making secret agreements, setting prices and determining business conditions 2. Trust – a combination of firms or corporations formed by a legal agreement headed by a small group. The goal of a trust is to reduce or eliminate competition. 1. Pool – a group making secret agreements, setting prices and determining business conditions 2. Trust – a combination of firms or corporations formed by a legal agreement headed by a small group. The goal of a trust is to reduce or eliminate competition.

Standard Oil Company

New Types of Business Entities 2. Trust: * Horizontal Integration  John D. Rockefeller * Vertical Integration: A. Gustavus Swift  Meat-packing B.Andrew Carnegie  U. S. Steel C.John D. Rockefeller – Standard Oil B.Andrew Carnegie  U. S. Steel C.John D. Rockefeller – Standard Oil

Iron & Steel Production

U. S. Corporate Mergers

Industrial Consolidation: Iron & Steel Firms

Robber Barons / Gospel of Wealth  Andrew Carnegie  John D. Rockefeller  J.P. Morgan  Social Darwinism  Gospel of Wealth

Big Business Emerges  Andrew Carnegie Steel Baron – 80% of American SteelSteel Baron – 80% of American Steel Management GeniusManagement Genius Gospel of WealthGospel of Wealth  90% ($325 million) donated to music, arts, and libraries  John D. Rockefeller Oil Baron – Standard Oil – 90% of American OilOil Baron – Standard Oil – 90% of American Oil Consolidate, compete, and dominateConsolidate, compete, and dominate Philanthropist - $500 million to U of C, foundations, and hospitalsPhilanthropist - $500 million to U of C, foundations, and hospitals  J.P. Morgan Financial GeniusFinancial Genius Philanthropist – smaller scale but still huge $$Philanthropist – smaller scale but still huge $$

Current Philanthropists 2010 Grants  Gates Foundation - $3 Billion  Ford Foundation - $500 Million  Johnson Foundation - $350 Million  Hewlett Foundation - $340 Million  MacArthur Foundation - $300 Million  Kellogg Foundation - $244 Million  Wal-Mart Foundation - $216 Million  Rockefeller Foundation - $145 Million

New Financial Businessman The Broker: * J. Pierpont Morgan

Social Darwinism × Adapted Darwin’s ideas from the “Origin of Species” to humans. × Notion of “Survival of the Fittest.” × Adapted Darwin’s ideas from the “Origin of Species” to humans. × Notion of “Survival of the Fittest.” Herbert Spencer

Social Darwinism in America William Graham Sumner Folkways (1906) $ Individuals must have absolute freedom to struggle, succeed or fail. $ Therefore, state intervention to reward society and the economy is futile! $ Individuals must have absolute freedom to struggle, succeed or fail. $ Therefore, state intervention to reward society and the economy is futile!

New Business Culture: “The American Dream?” Protestant (Puritan) “Work Ethic” * Horatio Alger [100+ novels] Is the idea of the “self-made man” a MYTH??

The Gospel of Wealth: Religion in the Era of Industrialization Russell H. Conwell $ Wealth no longer looked upon as bad. $ Viewed as a sign of God’s approval. $ Christian duty to accumulate wealth. $ Should not help the poor. $ Wealth no longer looked upon as bad. $ Viewed as a sign of God’s approval. $ Christian duty to accumulate wealth. $ Should not help the poor.

“ On Wealth” Andrew Carnegie $ The Anglo-Saxon race is superior. $ “Gospel of Wealth” (1901). $ Inequality is inevitable and good. $ Wealthy should act as “trustees” for their “poorer brethren.” $ The Anglo-Saxon race is superior. $ “Gospel of Wealth” (1901). $ Inequality is inevitable and good. $ Wealthy should act as “trustees” for their “poorer brethren.”

Rise of Labor / Changing Economy of the South Pages  Labor vs. Management  Knights of Labor  Haymarket Riot  American Federation of Labor  Southern Industry

The Changing American Labor Force

Management vs. Labor “Tools” of Management “Tools” of Labor  “scabs”  P. R. campaign  Pinkertons  lockout  blacklisting  yellow-dog contracts  court injunctions  open shop  boycotts  sympathy demonstrations  informational picketing  closed shops  organized strikes  “wildcat” strikes

Knights of Labor Terence V. Powderly An injury to one is the concern of all!

Goals of the Knights of Labor  Eight-hour workday.  Abolition of child and prison labor.  Equal pay for men and women.  Safety codes in the workplace.  Prohibition of contract foreign labor.  Downfall of the KOL: combination of skilled and unskilled labor across multiple industries weakened strength and focus

Haymarket Riot (1886) McCormick Harvesting Machine Co.

Haymarket Martyrs

Governor John Peter Altgeld

The American Federation of Labor: 1886 Samuel Gompers

How the AF of L Would Help the Workers  Catered to the skilled worker.  Represented workers in matters of national legislation.  Maintained a national strike fund.  Evangelized the cause of unionism.  Prevented disputes among the many craft unions.  Mediated disputes between management and labor.  Pushed for closed shops.

Why the Unions didn’t get Equality  Union members viewed as anarchists  Easy and available replacements for unskilled labor  Emergence of craft specific unions weakened national groups  Small ‘real’ numbers of members (less than 5% of workforce in 1900)  Congressional issues – impact of influence?  working-stiffed working-stiffed

Shifting South  “Coffin nails” – automation changes South from raw material producer to horizontal integrator  Shift in textile manufacturing Why?Why? Blessing or curse?Blessing or curse?  Long term impacts

Urbanization/Immigration Pages  Growth of Urban Areas ChallengesChallenges  Rise of Immigration Who & why?Who & why? Native reactionsNative reactions Government restrictionsGovernment restrictions

Immigration  Why? Poverty, famine, land shortages, religious or political persecutionPoverty, famine, land shortages, religious or political persecution  Who? Britain, Ireland, Germany, Italy, Russia, Austria-Hungary, China, Japan, West Indies, MexicoBritain, Ireland, Germany, Italy, Russia, Austria-Hungary, China, Japan, West Indies, Mexico  How many? Between 1870 – 1920Between 1870 – 1920  20,000,000

Issues  Difficult journey SteamshipSteamship  Inspection at Ellis Island or Angel Island Physical examinationPhysical examination Document examinationDocument examination Literacy examinationLiteracy examination Ability to workAbility to work $25$25

Characteristics of Urbanization During the Gilded Age 1. Megalopolis. 2. Mass Transit. 3. Magnet for economic and social opportunities. 4. Pronounced class distinctions. - Inner & outer core 5. New frontier of opportunity for women. 6. Squalid living conditions for many. 7. Political machines. 8. Ethnic neighborhoods.

Urban Growth:

Problems of Urbanization  By 1910, immigrant families make up half of the population of 18 major US cities  Challenges Maintain culture and learn the “American” wayMaintain culture and learn the “American” way  Americanization movement – learn English, US history and government, social etiquette OvercrowdingOvercrowding TransportationTransportation Water and SanitationWater and Sanitation FireFire CrimeCrime

Urban Problems  Housing Row houses, tenements, dumbell tenementsRow houses, tenements, dumbell tenements  Transportation Rise of mass transit (streetcars and subways)Rise of mass transit (streetcars and subways)  Sanitation WaterWater  No indoor plumbing, fresh water Trash, manure, pollutionTrash, manure, pollution  Fire Wood buildings + limited water = FIREWood buildings + limited water = FIRE Volunteer fire departmentsVolunteer fire departments  Crime Small police forces outnumberedSmall police forces outnumbered

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