2. Essential Question Industrialization increased the standard of living and the opportunities of most Americans, but at what cost?

3. Following the Civil War, an industrial boom had begun transforming the nation's economic base from agriculture to industrial. Resources could be pooled and risks reduced through their merger. –oil trusts –steel trusts –mining trusts –sugar trusts.

4. Meet the Main Characters Vanderbilt Rockefeller Carnegie Morgan Swift Gould Fisk Ford Monopoly power also meant strength. –Standard Oil - Rockefeller –industry captains such as steel magnate J. P. Morgan If rivals tried to enter a market, the monopolists would sell their goods at a loss until the competitors were destroyed, after which prices shot back up

5. Causes of Rapid Industrialization 1.Steam Revolution of the 1830s-1850s. 2.The Railroad fueled the growing US economy:  First big business in the US.  A magnet for financial investment.  The key to opening the West.  Aided the development of other industries. 1.Steam Revolution of the 1830s-1850s. 2.The Railroad fueled the growing US economy:  First big business in the US.  A magnet for financial investment.  The key to opening the West.  Aided the development of other industries.

6. Alexander Graham Bell Telephone (1876)

7. War of the Currents Edison vs Westinghouse/Tesla Edison depended on low-voltage direct current (DC) –only capable of sending electricity little more than a mile. George Westinghouse/Tesla had developed a far-reaching system that used high-voltage alternating current (AC)

8. Causes of Rapid Industrialization 3.Technological innovations.  Henry Bessemer and open hearth process  Refrigerated cars 3.Technological innovations.  Henry Bessemer and open hearth process  Refrigerated cars

9. Thomas A. Edison  Thomas A. Edison o “Wizard of Menlo Park” o light bulb, phonograph, motion pictures. o Direct Current Electricity

10. Thomas Alva Edison “Wizard of Menlo Park” Phonograph, Light bulb, Motion Picture Camera and Dictaphone

11. Alternate Current Westinghouse Lamp ad

12. Alternate Current George Westinghouse Nikola Tesla

13. The Airplane Wilbur Wright Orville Wright Kitty Hawk, NC – December 7, 1903

14. Model T Automobile Henry Ford I want to pay my workers so that they can afford my product! Henry Ford I want to pay my workers so that they can afford my product!

15. “Model T” Prices & Sales

16. U. S. Patents Granted 1790s  276 patents issued. 1990s  1,119,220 patents issued.

17. 4.Unskilled & semi-skilled labor in abundance. 5.Abundant capital. 6.New, talented group of businessmen [entrepreneurs] and advisors. 7.Market growing as US population increased. 8.Government willing to help at all levels to stimulate economic growth. 9.Abundant natural resources. 4.Unskilled & semi-skilled labor in abundance. 5.Abundant capital. 6.New, talented group of businessmen [entrepreneurs] and advisors. 7.Market growing as US population increased. 8.Government willing to help at all levels to stimulate economic growth. 9.Abundant natural resources. Causes of Rapid Industrialization

18. New Business Culture 1. Laissez Faire  the ideology of the Industrial Age.  Individual as a moral and economic ideal.  Individuals should compete freely in the marketplace.  The market was not man-made or invented.  No room for government in the market!  Individual as a moral and economic ideal.  Individuals should compete freely in the marketplace.  The market was not man-made or invented.  No room for government in the market!

19. 2. Social Darwinism × British economist. × Advocate of laissez-faire. × Adapted Darwin’s ideas from the “Origin of Species” to humans. × Notion of “Survival of the Fittest.” × British economist. × Advocate of laissez-faire. × Adapted Darwin’s ideas from the “Origin of Species” to humans. × Notion of “Survival of the Fittest.” Herbert Spencer

20. 2. Social Darwinism in America William Graham Sumner Folkways (1906) $Individuals must have absolute freedom to struggle, succeed or fail. $Therefore, state intervention to reward society and the economy is futile! $Individuals must have absolute freedom to struggle, succeed or fail. $Therefore, state intervention to reward society and the economy is futile!

21. New Business Culture: “The American Dream?” 3.Protestant (Puritan) “Work Ethic”  Horatio Alger [100+ novels] 3.Protestant (Puritan) “Work Ethic”  Horatio Alger [100+ novels] Is the idea of the “self-made man” a MYTH??

22. New Type of Business Entities 1.Pool 1887  Interstate Commerce Act  Interstate Commerce Commission created. 2.Trust  John D. Rockefeller 1.Pool 1887  Interstate Commerce Act  Interstate Commerce Commission created. 2.Trust  John D. Rockefeller  Standard Oil Co.

23. Standard Oil Co.

24. New Type of Business Entities 2.Trust:  Horizontal Integration  John D. Rockefeller 2.Trust:  Horizontal Integration  John D. Rockefeller  Vertical Integration: o Gustavus Swift  Meat-packing o Andrew Carnegie  U. S. Steel  Vertical Integration: o Gustavus Swift  Meat-packing o Andrew Carnegie  U. S. Steel

25. Iron & Steel Production

26. New Type of Business Entities

27. Standard Oil Companies After the Breakup Exxon (now Exxon Mobil) Chevron (Chevron/Texaco) Mobil (now Exxon Mobil) Texaco (Now Chevron/Texaco) Amoco (now part of BP) Conoco Phillips

28. U. S. Corporate Mergers

29. New Financial Businessman The Broker:  J. Pierpont Morgan The Broker:  J. Pierpont Morgan

30. Wall Street – 1867 & 1900

31. The Reorganization of Work Frederick W. Taylor The Principles of Scientific Management (1911) Frederick W. Taylor The Principles of Scientific Management (1911)

32. The Reorganization of Work The Assembly Line

33. % of Billionaires in 1900

34. % of Billionaires in 1918

35. The Protectors of Our Industries

36. The ‘Bosses’ of the Senate

37. The ‘Robber Barons’ of the Past

38. Cornelius [“Commodore”] Vanderbilt Can’t I do what I want with my money?

39. William Vanderbilt $ The public be damned! $ What do I care about the law? H’aint I got the power? $ The public be damned! $ What do I care about the law? H’aint I got the power?

40. Railroads Pacific Railway Act (1862) funding for Transcontinental Railroad, seen as a necessity –Union Pacific – granted 20 square miles of land for each mile of RR track, resold for profit (Credit Mobiler), earned 73 Million for 50 million dollars of work, –Central Pacific – same, except less profitable Led by Big 4 –Used Irish and Chinese labors, “Not a Chinamen’s Chance”, derogatory term from time period Coolies Linked at Promontory Point Utah UP 1,086 and CP 689 Significance of Railroads – linked USA for Transportation and Communication, Increased growth of US, perceived as a great achievement

41. “The Big Four” Railroad Magnates Charles Crocker Mark Hopkins Leland Stanford Collis Huntington

42. Were Railroads built ahead of demand? http://www.stanford.edu/group/spatialhistory/c gi-bin/site/viz.php?id=341&project_id=0http://www.stanford.edu/group/spatialhistory/c gi-bin/site/viz.php?id=341&project_id=0

43. Chinese chain gang workers building the transcontinental railroad

44. The Gospel of Wealth: Religion in the Era of Industrialization Russell H. Conwell $ Wealth no longer looked upon as bad. $ Viewed as a sign of God’s approval. $ Christian duty to accumulate wealth. $ Should not help the poor. $ Wealth no longer looked upon as bad. $ Viewed as a sign of God’s approval. $ Christian duty to accumulate wealth. $ Should not help the poor.

45. “On Wealth” Andrew Carnegie $ The Anglo-Saxon race is superior. $ “Gospel of Wealth” (1901). $ Inequality is inevitable and good. $ Wealthy should act as “trustees” for their “poorer brethren.” $ The Anglo-Saxon race is superior. $ “Gospel of Wealth” (1901). $ Inequality is inevitable and good. $ Wealthy should act as “trustees” for their “poorer brethren.”

46. Regulating the Trusts 1877  Munn. v. IL - against railroads, Granger Law, public has right to regulate business when the public has an interest 1886  Wabash, St. Louis & Pacific Railroad Company v. IL overturns Munn, only Federal government can regulate business 1887 – Interstate Commerce Act prohibited pools, railroads must publish fares, no more short vs. Long Haul rates 1890  Sherman Antitrust Act  in “restraint of trade”  “rule of reason” loophole 1895  US v. E. C. Knight Co. –manufacturing is not trade or commerce so not under Sherman A-T 1877  Munn. v. IL - against railroads, Granger Law, public has right to regulate business when the public has an interest 1886  Wabash, St. Louis & Pacific Railroad Company v. IL overturns Munn, only Federal government can regulate business 1887 – Interstate Commerce Act prohibited pools, railroads must publish fares, no more short vs. Long Haul rates 1890  Sherman Antitrust Act  in “restraint of trade”  “rule of reason” loophole 1895  US v. E. C. Knight Co. –manufacturing is not trade or commerce so not under Sherman A-T

47. Relative Share of World Manufacturing

48. Modern ‘Robber Barons’??