2. Essential Question: Warm-Up Question:
How did the “Second Industrial Revolution” transform the U.S. during the Gilded Age?
Warm-Up Question:
To what extent had the United States developed a “national market economy” by the outbreak of the Civil War (1860)?
What developments were still needed to improve America’s national market economy?
Lesson Plan for Monday, November 24, 2008: Warm-up question, The Rise of Industry & Urbanization Notes

3. Gilded Age Industrialization
During the Gilded Age, American businesses were transformed:
Massive corporations replaced small, family businesses
New technology, transportation, marketing, labor relations, & efficient mass-production
By 1900, the U.S. was the most industrialized country in the world

4. The Business of Invention
19th-century inventors led to an “Age of Invention”:
Cyrus Field’s telegraph cable
Business typewriters, cash registers, adding machines
High-speed textile spindles, auto looms, sewing machines
George Eastman’s Kodak camera
Alexander G. Bell’s telephone
By 1905, 10 million Americans had phones; (Bell Telephone Co became AT&T) 13

5. The Business of Invention
Thomas Edison, the “Wizard of Menlo Park,” created the 1st research lab in New York
Edison Illuminating Co was the to 1st use electric light in 1882
Tesla’s alternating current (AC) allowed electricity to travel over longer distances & to power streetcars & factories

6. Patents Issued ( )

7. The Business of Invention
New technologies allowed for increased industrial production
New machines were incorporated into the first assembly lines which allowed for continuous & faster production of goods
The railroad linked every region of America & allowed for a mass consumption of goods 13

8. Chicago Meatpackers: The 1st “Disassembly Line”

9. The Midwest Made Meat for America
A new-and-improved “market revolution”: More regional specialization made mass production & mass consumption possible
(Chicago→meat, St Louis→beer, & Minneapolis→grain)

10. New Methods of Marketing
Marketing became a “science”:
Advertising firms boomed
Department stores like Macy’s & Marshall Field’s allowed customers to browse & buy
Chain stores like A&P Grocery & Woolworth’s “Five & Ten”
Mail-order catalogues, like Montgomery Ward sold to all parts of America 14

11. New Forms of Business Organization
“Trusts” use a board of trustees to manage a company
“Holding companies” oversee & manage other subsidiary companies
New types of business organization were used to increase profits:
“Trusts” & “holding companies” integrated various businesses under 1 board of directors
Vertical & horizontal integration maximized corporate profits
Frederick Taylor’s “scientific management” emphasized time efficiency & mid-level managers
Led to monopolists like Carnegie, J.P. Morgan, & Rockefeller 13

12. Vertical & Horizontal Integration
U. S. Corporate Mergers
By 1900, 1% of U.S. companies controlled 33% of all industry

13. New Forms of Business Organization
Business leaders used a variety of ideas to justify their wealth:
The “Gospel of Wealth” argued that it is God's will that some men attained great wealth
Social Darwinism taught that natural competition weeds out the weak & the strong survive
Were monopolists “captains of industry” or “robber barons”? 14

14. The “Robber Barons” of the Past

15. The Industrialization of America

16. The Second Industrial Revolution was fueled by 3 industries: railroads, steel, & oil

17. The Railroad Industry
America’s first “big business” was the railroad industry:
Railroads stimulated the coal, petroleum, & iron/steel industries
Large companies bought small railroads, standardized gauges & schedules, & pooled cars
Small lines in the east acted as tributaries to the 4 great trunk lines into the West 3

18. Cornelius “the Commodore” Vanderbilt was the most powerful figure in the railroad industry
Jim Fisk

19. Problems of Growth
Speculators like Jay Gould built & bought rail lines to profit with little concern for efficient use
But, the railroad industry faced problems due to overbuilding in the 1870s & 1880s:
Mass competition among RRs
RR lines offered special rates & rebates (secret discounts) to lure passengers & freight on their lines
Pooling & consolidation failed to help over-speculation 8

20. Problems of Growth
RR bosses asked bank financier J.P. Morgan to save their industry:
Morgan created a traffic-sharing plan to end wasteful competition
“Morganization” fixed costs, cut debt, stabilized rates, issued new stock, & ended rebates
Created a “board of trustees”
By 1900, 7 giant (centralized & efficient) rail systems dominated 8

21. The Steel Industry
Steel transformed world industry:
Allowed for taller buildings, longer bridges, stronger railroad lines, & heavier machinery
Andrew Carnegie’s company made more steel than England
Carnegie converted his steel plants to the Bessemer process & was able to out-produce his competition & offer lower prices
Andrew Carnegie was the great example of the “American Dream” & social mobility
Henry Bessemer (& William Kelly) turned iron into steel in 1850s—process allowed for mass production of steel 9

22. International Steel Production, 1880-1914
The U.S. was ideal for steel production because it had lots of coal, iron, & railroads

23. Rockefeller and Oil Petroleum also changed industry
New industrial machines needed kerosene for lighting & lubricants
John D. Rockefeller monopolized the oil industry, lowered oil costs & improved the quality of oil
By 1879, Standard Oil ruled 90% of all U.S. oil & sold to Asia, Africa, & South America
In 1863, John D. Rockefeller created Standard Oil Company in Cleveland (at age 24!); he also used spies, bribery, threats 12

24. Standard Oil: The Monster Monopoly?

25. Essential Question: Reading Quiz Ch 18 B (625—639)
What role did the business leaders play in stabilizing the chaotic business cycles of the Gilded Age?
Reading Quiz Ch 18 B (625—639)
Lesson Plan for Tuesday, November 25, 2008: RQ 18B, Finish Industrialism notes, Examine Center for Learning Activity #26, Using Mindsparks overheads to develop a class discussion: Were Gilded Age corporate leaders “robber barons” or “captains of industry”?