1. The Triumph of Industry 1865-1914
New York City, 1860s

2. Key Terms and People Entrepreneur Protective Tariff Laissez faire
Patent
Thomas Edison
Bessemer process
Suspension bridge
Time zone
Mass production
Essential Question:
How did industrialization and new technology affect the economy and society?

3. First Industrial Revolution
Began in Britain during 1700s - Textile Industry
Key Components:
Steam Engine
Factory System
Key Resources:
Iron
Coal
Diagram of Watt’s Steam
Engine, 1755

4. Second Industrial Revolution
Began around 1850s
Dominated by steel, oil and electricity
Bessemer Furnace, Kelham Island Museum, Sheffield England

5. Think About It…
What sorts of items were necessary during the Civil War?
How did the Civil War encourage industry?

6. America’s Natural Resources
Vast resource supply helped fuel growth
Coal mines along east coast
Thick forests cut down for lumber
First oil well drilled in 1859
Strip Coal Mine, Sullivan County, PA

7. What impact might this have had on industry?
Immigration in the U.S.
Post Civil War – large influx of Europeans and Asians due to:
Political unrest
Religious discrimination
Crop failures
1881 – 750,000 immigrants
1905 – more than 1,000,000 per year
What impact might this have had on industry?

8. Street Life in New York Published in 1868 by Horatio Alger
Told the story of a poor boy who rose to wealth and fame by working hard
From “rags to riches” story
Horatio Alger,

9. Can you think of any other economic systems?
What is Capitalism?
Free enterprise; individuals own most businesses
Entrepreneurs – people who invest money in a business or product in order to make a profit.
Can you think of any other economic systems?

10. Government Policies
Gave railroad builders large pieces of land in order to link East and West coasts.
Protective Tariffs – taxes that made imported goods cost more.
Laissez-faire – allowed businesses to operate under minimal government regulation.

11. Think About It…
What factors spurred industrial growth in the late 1800s?

12. Innovation Drives the Nation
Patent – grant by the federal government giving the inventor the exclusive right to develop, use, and sell an invention for a set period of time
Original Microwave Oven Patent
Dr. Percy Spencer, 1950

13. Major Inventions of the 1800s
1844 – Telegraph
1846 – Sewing Machine
1852 – Safety Elevator
1880 – Light Bulb
1884 – Steam Boiler Furnace
Thomas Edison

14. Drawing of Henry Bessemer, Vanity Fair, 1880
The Bessemer Process
Steel – Henry Bessemer, a British engineer, developed a process for purifying iron, which resulted in a strong, lightweight steel.
What impact do you think this had on society? What is steel currently used for?
Drawing of Henry Bessemer, Vanity Fair, 1880

15. Technology and Transportation
1883 – Three transcontinental railroad lines in the U.S.
1884 – Delegates from 27 countries decided to divide the world into 24 time zones, one for each hour of the day
During most of the 1800s towns set their clocks independently. By 1883, why did this become a problem?

16. Railroad Steam Engine, late 1800s
The Railroad Effect
Trains transported large amounts of goods, cheaply, quickly and efficiently
Allowed business to obtain raw materials easily, and opened up new markets to sell goods
What is mass production?
Why did this occur?
Railroad Steam Engine, late 1800s

17. Think About It…
How did new technologies shape industrialization?

18. Impact of Industrialization
Globalization
Linked world markets; American economy expanded
As United States grew into a world power, it often conflicted with political views and political policies of other countries.
American Society
Farms became mechanized=fewer workers, joblessness=influx of workers to cities
Greater access to goods and products; no longer made items by hand
Increased cost of living, depended on cash wages
Environment
Late 1800s – industrial waste is rapidly rising = Midwest; soil erosion and dust storms
Congress’ response – National Park Service; Yellowstone, 1872

19. Question for Reflection
What impact did industrialization have on Americans?

20. The Rise of Big Business
Key Terms and People:
Corporation
Monopoly
Cartel
John D. Rockefeller
Horizontal integration
Trust
Andrew Carnegie
Vertical integration
Social Darwinism
Interstate Commerce Commission
Sherman Antitrust Act
Essential Question:
How did big business shape the American economy in the late 1800s and early 1900s?

21. Think About It…
Before the Industrial Revolution businesses were not very large. How did the IR change this?

22. Corporations
Corporation – A business in which a number of people share in the ownership
Advantages –
Greater access to resources
Share cost of ownership
Has the same rights as individuals (buy and sell land, sue in court, etc.)

23. The Competitive Edge Wide-spread advertising
JP Morgan – investing in research
Monopoly – corporation that has complete control of a product
Cartel – group of corporations that band together in order to eliminate competition from other businesses
J.P. Morgan
John D. Rockefeller
Henry Flagler
Andrew Carnegie

24. Horizontal and Vertical Integration
Horizontal Integration – creating a giant company with low production costs by consolidating many firms into one company
Ex. Rockefeller – Standard Oil Company
Vertical Integration – consolidating many different businesses involved with the development of a specific product
Ex. Rockefeller and Carnegie

25. What is a Trust?
Ohio law prevented one company from owning stock in another, thus preventing horizontal integration.
Rockefeller’s lawyer created the TRUST to get around this law.
Trust – companies assign their stock to a board of trustees, who combine them into a new organization. The trustees run the organization, and then pay themselves dividends on the profits.

26. Think About It…
What strategies did corporations use to decrease costs and increase profits?

27. Robber Barons or Captains of Industry?
Small businesses squeezed out of business
Cartels often set unfairly high prices
ROBBER BARON!
Provided jobs for millions of workers
Technological development
Economy boomed
CAPTAINS OF INDUSTRY!

28. Social Darwinism
Charles Darwin, On the Origin of Species (1859); animals evolved based on the process of natural selection – “Only the strong survive”
This theory was soon applied to American capitalism. What do you think were the results of this?

29. Social Darwinism
Wealth was a measure of one’s inherent value; those who had it were most ‘fit’
Laissez-faire: Government should stay out of the business world. This process of “natural selection” would make the country grow rich and strong.
Many used this theory to validate racist beliefs and values. Cited poverty-stricken condition as evidence of the inferiority of minorities!

30. Government Regulations
Interstate Commerce Commission (1887)
Oversaw railroad industry to fight price-fixing and pooling
First government agency to regulate business, but was weak:
Could only monitor railroads that crossed state lines
Could not make laws or control railroads transactions
Could force railroad industry to submit records to Congress

31. Government Regulations
Sherman Antitrust Act (1890)
Outlawed any trust that operated “in restraint of trade or commerce among the several states.”
Was rarely enforced but started a trend of government oversight and regulation
Sen. John Sherman