Chapter 24 Objective: Students will understand the role that industry played in the United States during the Gilded Age

Iron Horse 35,000 miles of track in 1865 and by ,000 Too expensive, needed government funding, mostly done through land grants Checkerboard land grants next to the tracks, this was the cheapest way for the government, didn’t have to come up with cash 1862 creation of the UP RR to build a transcontinental RR ▫Paid for by gov’t loans and land grants and built by Irish and Chinese workers ▫Central Pacific RR worked east through the Sierra Nevadas  Big 4 were the founders including Stanford ▫1869 Promontory Point in Utah Opened the way West, trade with Asia, etc. 5 total transcontinental RR by 1900 Northern Pacific, UP, Santa Fe, Southern Pacific, Great Northern

--Western lines existed by joining older eastern lines  Vanderbilt  Made his fortune off steamboats and turned to trains  Had over $100 million, founded Vanderbilt University with a million dollar contribution  Steel rails replaced iron, heavier loads  Standard gauge, air brakes, Pullman cars, etc.

 United the whole country, created domestic markets for raw materials and manufactured goods, helped industrialize the country  Stimulated mining and agriculture, immigration, etc.  Brought on rapid ecological change to the west  Created time zones  Millions made and lost in RR speculation

 Credit Mobilier Scandal—UP  Jay Gould  Stock watering, Pools  The railroaders bribed judges, congressmen, etc or elected their own men  Operated control over people’s lives, more so than the gov’t

 Grange  Political organization of farmers that tried to regulate the RR  Wabash case  States had no power to regulate interstate commerce  Interstate Commerce Act of 1887  Prohibited rebates, pools, had to publish rates, stopped unfair discrimination, outlawed charging more for short vs. long hauls  Set up the ICC; Interstate Commerce Commission to enforce the laws  Tended to stabilize the RR not revolutionize them, helped the RR not the common people  1 st attempt by the federal government to regulate business for the benefit of the people

Vertical integration Carnegie used every aspect of steel from mining it to shipping it after it was formed Horizontal integration Eliminate all competition, Rockefeller and Standard Oil, controlled 95% of the oil refineries in US Interlocking Directorates—Morgan Had his own officers on the board of directors for dozens of his competitors

 By 1880 US produced 1/3 of the world’s steel  Bessemer Process (also Kelly) apply cold air to the hot iron to burn off impurities  Carnegie  Started at the bottom and worked his way up  Controlled the steel mills in Pittsburgh and made over 25$ million a year in pure profits for himself  Sold out to Morgan for over 400$ million  Ended up giving away over 350$ million of it  Morgan created United States Steel Corporation worth 1.4$ billion  By 1880 US produced 1/3 of the world’s steel  Bessemer Process (also Kelly) apply cold air to the hot iron to burn off impurities  Carnegie  Started at the bottom and worked his way up  Controlled the steel mills in Pittsburgh and made over 25$ million a year in pure profits for himself  Sold out to Morgan for over 400$ million  Ended up giving away over 350$ million of it  Morgan created United States Steel Corporation worth 1.4$ billion

 Created Standard Oil in 1870 by 1877 he controlled 95% of all refineries  Used ruthless tactics to take over his competitors, if they didn’t sell out to him he would ruin them  He did produce a better product at a low price  Perfect example of a social Darwinist, survival of the fittest  Created Standard Oil in 1870 by 1877 he controlled 95% of all refineries  Used ruthless tactics to take over his competitors, if they didn’t sell out to him he would ruin them  He did produce a better product at a low price  Perfect example of a social Darwinist, survival of the fittest

 Many of the wealthy credited God for their riches, it was His will  Carnegie believed the wealthy had to prove their worthiness according to the “Gospel of Wealth”  Most Robber Barons believed in Social Darwinism, survival of the fittest  Had a natural contempt for the poor, saw it as their own fault because they were lazy  Used the Interstate Commerce clause and 14 th amendment of the Constitution to stay in power  Many of the wealthy credited God for their riches, it was His will  Carnegie believed the wealthy had to prove their worthiness according to the “Gospel of Wealth”  Most Robber Barons believed in Social Darwinism, survival of the fittest  Had a natural contempt for the poor, saw it as their own fault because they were lazy  Used the Interstate Commerce clause and 14 th amendment of the Constitution to stay in power

 1 st tried state legislation but it was declared unconstitutional  Sherman Antitrust Act 1890  Forbade combinations in restraint of trade  Didn’t make distinctions between good and bad trusts—big was bad  It was very ineffective, had no teeth and too many loopholes  Actually used to stop labor unions

 While industrialization in the North was massive in the South it was tiny  Less manufacturing than before the civil war  Southern agriculture did get a boost from a cigarette rolling machine, helped create the cigarette trust  Industrialists tried to industrialize the south but it remained to rural  RR charged more for southern goods helped keep the south in a 3 rd world status supplying raw materials to the north and buying its manufactured goods  Birmingham had ore and coal but RR charged them outrageous prices  One area they did have an advantage in was textiles  Employed poor whites in the textile factories  While industrialization in the North was massive in the South it was tiny  Less manufacturing than before the civil war  Southern agriculture did get a boost from a cigarette rolling machine, helped create the cigarette trust  Industrialists tried to industrialize the south but it remained to rural  RR charged more for southern goods helped keep the south in a 3 rd world status supplying raw materials to the north and buying its manufactured goods  Birmingham had ore and coal but RR charged them outrageous prices  One area they did have an advantage in was textiles  Employed poor whites in the textile factories

 Increased the wealth of the country, standard of living, urbanization  Decline in agriculture led to the death of Jeffersonian Democracy  No longer a nation of small farmers and free enterprise  Started living according to the factory whistle not nature  Changed women’s lives dramatically  Typewriter, telephone, idea of an athletic women became in fashion  Careers meant later marriages, fewer kids  Worked because they had to  Larger gap between rich and poor- 10% owned 90% of the wealth

 Labor did most of the work and the employers got the benefit  Labor was impersonalized- didn’t know the people they worked with or even the boss  People were replaced by machines  Too many people, too much labor drove prices down  The workers were almost powerless to change anything, needed the job, the corporation could fire the workers and find more  Federal government even helped business by breaking strikes to stop troops, courts even issued injunctions for the strikers to stop  Lockouts, yellow dog contracts, black lists, company town

 National Labor Union years 600,000 members  8 hour work day for government employees  Knights of Labor (Noble and Holy Order of the Knights of Labor 1869)  Included all workers-700,000 in all  Wanted economic and social reform, safety codes, 8 hour days  Beat Gould in a strike for the 8 hour day  1886 Knights lost several strikes  Haymarket Riot May 4, 1886  Police broke up a meeting and a bomb was thrown that killed police  8 were arrested – 5 executed  Last hurray for the Knights  Also hurt by skilled and unskilled workers the skilled left to the AFL (American Federation of Labor)  National Labor Union years 600,000 members  8 hour work day for government employees  Knights of Labor (Noble and Holy Order of the Knights of Labor 1869)  Included all workers-700,000 in all  Wanted economic and social reform, safety codes, 8 hour days  Beat Gould in a strike for the 8 hour day  1886 Knights lost several strikes  Haymarket Riot May 4, 1886  Police broke up a meeting and a bomb was thrown that killed police  8 were arrested – 5 executed  Last hurray for the Knights  Also hurt by skilled and unskilled workers the skilled left to the AFL (American Federation of Labor)

 Set up by Samuel Gompers and was the president every year but one  It was a federation of smaller unions  Wanted a larger share of the profits, better wages, shorter hours, better working conditions  Tools were the walk out and the boycott  Pooled money to ride out the strikes  Skilled labor only  By 1900 had 500,000 members  Labor Day 1894  Set up by Samuel Gompers and was the president every year but one  It was a federation of smaller unions  Wanted a larger share of the profits, better wages, shorter hours, better working conditions  Tools were the walk out and the boycott  Pooled money to ride out the strikes  Skilled labor only  By 1900 had 500,000 members  Labor Day 1894