1. Triumph of Industry

2. The Foundations for Economic Growth
Abundant Natural Resources
The “Free Enterprise” System
Capitalism – system of economic organization under which tools, factories, and other means of production – known as capital – are privately owned.
Market economy – people can buy and sell goods and labor on an open market.
Encourages the production of better and cheaper goods.

3. The Foundations for Economic Growth
Social Darwinism – the most successful individuals were those with superior talent who had the ability to adapt, survive, and thrive.
Poverty the fault of the poor.

4. The Foundations for Economic Growth
The Role of Government
“laissez-faire” capitalism – as little government interference in the free market as possible.
Gov’t still interfered a little

5. Patent system – guarantees an inventor exclusive rights to the use of his or her invention for a limited period, if a patent was filed and issued.
Tariffs – protects American manufacturing by placing a duty, or tax, on foreign-made goods.

6. The Foundations for Economic Growth
The Legacy of the First Industrial Revolution
Economic Stimulus Provided by the Civil War
Northern industries benefitted by laws and tariffs passed during the war

7. America’s Second Industrial Revolution
“Second Industrial Revolution” – from , period of rapid industrial development and economic growth.

8. Railways
From 35,000 miles of track in 1865 – more than 175,000 miles by 1890.
George Pullman – invented the sleeping car
George Westinghouse – invented the air brake, which stopped all the cars of a train at the same time.
Railroad schedules created the need for time zones.

11. Technological Innovation
Invention – process of developing something for the first time
Innovation – process of putting these ideas and methods into practice
“Necessity is the mother of invention.”

12. Steel
“Bessemer process” – made producing steel more than 80% cheaper. Removed impurities from the iron by oxidation with air being blown through the molten iron.
Made it possible to build: railroad track, giant steamships, steel suspension bridges, large turbines and engines, and skyscrapers.

14. Communications
Samuel Morse ( ) – developed the telegraph and a code for transmitting the alphabet.
Telegraph - a system for transmitting messages from a distance along a wire by creating signals by making and breaking an electrical connection.

16. Alexander Graham Bell (1847-1922)
Cyrus Field ( )
Laid the first transatlantic cable to carry telegraphic messages from America to Europe.
Alexander Graham Bell ( )
Patented the telephone.

17. Electricity Thomas Alva Edison invented:
Phonograph – record player
Electrical light bulb
Electric motors invented and replaced some steam engines.
Nicola Tesla developed a motor for producing alternating current which could travel longer.

19. Oil Edwin Drake – drilled the first oil well in Pennsylvania in 1859
Refining oil allowed products to be made from petroleum – such as kerosene and gasoline.

20. Other Industries
Internal combustion engine – used controlled explosions of gasoline to move pistons in a cylinder – able to run automobiles.
Henry Ford – automobile manufacturer
Wilbur and Orville Wright – used internal combustion engine to power the first airplane.

22. Women and African-Americans
Josephine Cochran – invented the first automatic dishwasher
John Albert Burr – patented and improved the rotary-blade lawnmower
Granville T. Woods – patented a series of inventions for trains and streetcars
Elijah McCoy – patented oil-drip cups to add oil to engines automatically.

23. Sarah Goode – first African-American woman to receive a patent
Sarah Goode – first African-American woman to receive a patent. Created a foldaway bed.
Madam C.J. Walker – African-American cosmetic producer. Invented shampoos to help with scalp diseases. May have been the first African-American millionaire.
Lewis Howard Latimer – Improved the carbon filaments used in the electric light bulb

24. A Growing Population
Farmers able to produce more food due to new machinery and land.
Population more than tripled between 1860 and 1920.

25. Emergence of a National Market
Large city population and ease of transportation led to a national market.
Large corporations and advertising developed.
Department stores, chain stores, mail order stores, and specialty shops.

26. Entrepreneurial Spirit
Entrepreneurs – are those who take risks by engaging in business to make a profit.
In Second Industrial Revolution, entrepreneurs were known for:
Adopting new technologies
Called “Robber Barons” – exploited workers, used dishonest tactics, and exercised their monopoly control over individual industries to overcharge the public.

28. Great Entrepreneurs
“Gilded Age” – nickname of the Second Industrial Revolution due to displays of wealth by industrialists, often obtained through unethical and dishonest tactics.

29. Known for steel production
Andrew Carnegie
Known for steel production
One of the first to adopt the Bessemer process
Vertical integration – complete control over all stages of the production and distribution process.
Spent the end of his life giving his money away in acts of philanthropy.
Wrote the Gospel of Wealth – expressed his belief that a rich man should not die with his wealth but should give it away.

31. John D. Rockefeller Known for oil. Formed Standard Oil Company
Bought out competitors and made agreements with other companies to keep his oil cheaper than his competitors.
Formed the Standard Oil Trust
First industrial trust
Owned 90% of all oil refining in the USA.
Horizontal integration – when one owner controls all companies and facilities at one stage of production of a good or commodity.

34. John Pierpont (J.P) Morgan
Helped Thomas Edison form the Edison Electric Company.
Kicked Edison out and remained the company General Electric and adopted Tesla’s system.
Formed the J.P. Morgan and Company – an investment banking institution.
Bought Carnegie’s steelworks and formed US Steel – the first billion-dollar company in the US.

36. The Consolidation of Big Business and the Government Response
Depression of 1873
big entrepreneurs drove out smaller competitors
falling prices led to rival companies joining together.

37. Pooling agreements – informal agreements to fix prices or divide markets.
Trusts – smaller companies within a larger corporation that are controlled as a single enterprise.
Holding company – a company that owned a controlling number of shares in other companies.

38. The Dangers of Monopoly
Monopoly – complete control over the production of a good or service.
Disadvantages of a monopoly:
Less incentive to improve product due to no competition
Prices could go up because consumers had no other alternatives.

39. Early Government Regulation of Business
Munn v. Illinois (1877) – Supreme Court ruled that states can regulate businesses affecting the public interest, such as railroads.
Wabash v. Illinois (1886) – Ruled states could not regulate railroads running through several states since this was “interstate commerce.”
Interstate Commerce Act (1887) – Law against unfair practices by railroads. All customers required to pay the same rates. A special regulatory commission established to enforce the act.

40. Sherman Antitrust Act (1890) – Congress forbade all trusts, combinations, and conspiracies that limited or restricted interstate trade.
U.S. v. E.C. Knight Company (1895) – ruled the Sherman Antitrust Act could not be used to break up a monopoly unless the monopoly dealt with interstate commerce.