1. President Grant & the Importance of the Railroads
“Era of Good Stealings”

2. The Grant Administration
Laissez faire – Govt. did little to regulate businesses; working conditions or trade
Spoils System/Patronage
Hiring “unqualified” friends or supporters for govt. positions
Numerous domestic scandals involving Grant’s subordinates

3. Black Friday
Jay Gould and James Fisk attempted to corner the gold market in the US
Helped by President Grant’s brother in law
Millions were lost as stock prices plummeted
Inadvertently led to the end of Reconstruction as people refused to vote for Republicans over fear of corruption
“Era of Good Stealings”

4. Whiskey Ring
Millions of dollars in liquor taxes were stolen by numerous government employees over several states
Over 110 convicted, including President Grant’s personal secretary

5. Railroad Corruption Credit Mobilier corruption scandal
RR defrauded the US government of land and money
Later found some US politicians profited too
Huge RR profits led to calls for regulation to protect average Americans
Almost cost Grant reelection
Revealed growing tension between social classes out West

6. Railroads and Expansion
Pacific Railway Act – Millions of acres given to railroad companies for building tracks and telegraph lines
1st Transcontinental Railroad completed at Promontory Point, Utah in 1869
5 transcontinental railroads built between and 1893

7. Railroads were needed to ship food from the West to the East
Government subsidized RR’s
Good for US economy
Led to the creation of time zones; train schedule

9. ©2004 Wadsworth, a division of Thomson Learning, Inc
©2004 Wadsworth, a division of Thomson Learning, Inc. Thomson Learning™ is a trademark used herein under license.
Railroad Expansion, 1870–1890

10. Railroads and Immigration
Widespread Chinese & Irish immigration to build the railroads led to persecution
Chinese Immigration Act of 1882 – Barred Chinese Immigration to the West Coast
Fear that they would not assimilate

11. The Gilded Age

12. The “Gilded Age”
Era marked by extreme wealth among rich and extreme poverty among poor
Conspicuous consumption was encouraged
Buying things to show your rich
“Keeping up with the Joneses”

13. Business Leaders John D. Rockefeller – Standard Oil
Andrew Carnegie – Carnegie Steel
Cornelius Vanderbilt – Railroads
JP Morgan – Banking
Thomas Edison / General Electric
Jay Gould – Banking / Railroads

14. Two separate views arise of business leaders
Captains of Industry
Robber Barons
Social Darwinism - Some individuals work harder, are smarter, and deserve more rewards
Survival of the fittest / strongest

15. Captains of Industry
Wealthy business leaders have earned what they have through hard work, dedication (smarter)
Provide Jobs, Pay Taxes to the govt.
Philanthropy – giving large sums of money to charity
Carnegie gave millions to public libraries aka
“Gospel of Wealth”
Many gave to universities
Vanderbilt, Carnegie Mellon

16. Robber Barons
Common nickname for business leaders among the working class
They got unbelievably rich while workers lived in tenements (slums)
Workers worked long hours in unsafe conditions for little pay and no benefits
No Insurance, Overtime, Vacations

17. You get hurt you get fired Kids worked the same hours as adults
Cities were crowded, filthy, and polluted
Disease and crime were the norm

18. 2nd Industrial Revolution
Emergence of US Corporate America,

19. An Expansive and Volatile Economy
All sectors expanding, especially manufacturing
Economic power brought political influence and corruption
Railroad industry was the backbone of economic growth
Bessemer process was the most important
Made steel much cheaper to produce
Led to a dramatic increase in skyscrapers

20. Development of new technology Electric Power
Gasoline-powered internal combustion engine
Led to rise of related industries
Light bulb, elevators, telephone

21. Value Added by Economic Sector, 1869–1899
©2004 Wadsworth, a division of Thomson Learning, Inc. Thomson Learning™ is a trademark used herein under license.
Value Added by Economic Sector, 1869–1899
(in 1879 prices)

22. Change in Distribution of the American Workforce, 1870–1920
©2004 Wadsworth, a division of Thomson Learning, Inc. Thomson Learning™ is a trademark used herein under license.

23. Creation of Corporations
Rise of large corporations created national markets and mass production and distribution
Corporation – Large business, buy stock
Get a cut of the company profits
Complicated corporate hierarchies
Board of Directors, Advisors, etc.

24. Managing Factories Scientific management
Frederick Winslow Taylor, The Principles of Scientific Management (1911)
Jobs were broken down into the most routine and quickest tasks
Removed the skill from most jobs
Allowed businesses to pay workers much less
Henry Ford and the Assembly Line

25. The Monopoly Game
Corporations began to consolidate to overcome market competition
Horizontal Consolidation – A business takes control of most of its competitors
Vertical Consolidation – A business takes control of a supply chain
Monopoly – common term for Horizontal and vertical integration
Prices go up, quality down

26. The Role of Government?
Laissez faire – Govt. did little to regulate businesses; working conditions, trade, monopolies
Sherman Anti-Trust Act
Allowed govt. to break up monopolies
Commonly used against labor unions at first
U.S. Vs E.C. Knight Company
Supreme Court overruled parts of the Sherman Anti-Trust Act
S.C reversed their decision in the 1930’s

27. ©2004 Wadsworth, a division of Thomson Learning, Inc
©2004 Wadsworth, a division of Thomson Learning, Inc. Thomson Learning™ is a trademark used herein under license.
Industrial America,
1900–1920

28. Discussion Questions
Discuss the factors which contributed to the dramatic industrial growth of the United States in the late 19th century.