1. American History 2
Chapter 14 Presentation

2. Chapter 14
14.1 The Rise of Industry 14.2 The Railroads 14.3 Big Business 14.4 Unions
Thomas Edison

3. 14.1 The Rise of Industry Natural Resources Workforce Free Enterprise
Technology

4. Chapter Standards ACOS:
1.) Explain the transition of the United States from an agrarian society to an industrial nation prior to World War I.
AHSGE Standard V:
1. Identify and evaluate the events that led to the settlement of the West.
2. Evaluate the concepts, developments, and consequences of industrialization and urbanization.

5. Natural Resources
America had plenty of natural resources including water, timber, coal, iron, and copper.
Railroads brought settlers and miners to the West.
They used the railroads to send resources back to the East.

6. Natural Resources Petroleum was a new resource in high demand.
It was used to make kerosene.
Kerosene was used in lanterns and in stoves.
Edwin Drake drilled the first oil well in Pennsylvania in 1859.
Edwin Drake

7. Ellis Island Immigrants
Workforce
America had a large workforce to contribute to industrial growth.
These workers also created greater demand for products.
Population growth was a result of two factors: bigger families and immigration.
Ellis Island Immigrants

8. Free Enterprise
America’s economic system contributed to industrial growth.
Government decisions have a direct and indirect impact on the economy.
For example, measurements taken of Union soldiers during the Civil War led to the development of ready-made clothes.

9. Free Enterprise American’s supported the idea of laissez-faire.
This means government should have a “hands-off” policy towards the economy.

10. Free Enterprise
Entrepreneurs are rewarded for success in a free enterprise system.
Entrepreneurs are people who take risks to start businesses to make profits.

11. Free Enterprise
Supply and demand regulate prices and wages when a laissez-faire policy is implemented.
A laissez-faire policy supports government interference in the economy only to protect property rights and maintain peace.

12. Free Enterprise
The profit motive, or hope to make money, attracted people of high ability and ambition into business.
A nation's gross national product is the total value of all goods and services it produces during a year.

13. Technology Alexander Graham Bell invented the telephone in 1876.
Alexander Graham Bell spoke the first words on a telephone: “Come here, Watson, I want you.”
In 1877 Bell created the Bell Telephone Company.

14. Technology
Today, that company is called the American Telephone and Telegraph Company (AT&T).

16. Technology
Thomas Edison invented the phonograph (sound writer), like a record player.
Thomas Edison established his laboratory at Menlo Park, New Jersey.

17. Technology
Edison also perfected the light bulb around 1880 using a bamboo filament.
He also formed a power company in New York in 1882.
It and other Edison companies merged to create the Edison General Electric Company in 1889.
The company is called GE today.
Edison used direct current electricity.

18. Technology George Westinghouse discovered alternating current.
It was cheaper to produce.
It could travel further and be boosted at a transformer.

19. Technology
Thaddeus Lowe invented the ice machine, forerunner of the refrigerator.

20. Technology
Gustavus Swift created the refrigerated railroad car which could ship meat and other goods.

21. Technology In 1889, the first electric sewing machine was invented.
Cyrus Field laid the transatlantic telegraph in 1866.
Radio would also be developed during this era.

22. 14.2 The Railroads The Transcontinental Railroad The Railroad Industry
The Credit Mobilier Scandal
The Great Northern

23. Chapter Standards ACOS:
1.) Explain the transition of the United States from an agrarian society to an industrial nation prior to World War I.
AHSGE Standard V:
1. Identify and evaluate the events that led to the settlement of the West.
2. Evaluate the concepts, developments, and consequences of industrialization and urbanization.

24. The Transcontinental Railroad
President Lincoln signed the Pacific Railway Act in 1862.
Two railroad companies were hired to build a railroad to connect the east and west coasts.

25. The Transcontinental Railroad
The Union Pacific Company worked westward from Omaha, Nebraska.
Grenville Dodge engineered the project for Union Pacific.
They hired veterans, immigrants, miners, farmers, ex-convicts, and others.
They shipped their supplies from the Missouri River.

26. The Transcontinental Railroad
The Central Pacific Company worked eastward from Sacramento, California.
They could not find enough American workers.
They hired 10,000 Chinese workers.
They shipped their supplies around South America or across the Isthmus of Panama.
Both companies raced to lay the most track.

28. The Railroad Industry
The railroad industry helped other markets grow.
Cornelius Vanderbilt linked smaller railroad tracks together and made a lot of money.
He began the first direct rail service from New York City to Chicago.

29. The Railroad Industry
The American Railway Association created four time zones.
Local times had depended on the sun.
Different times created confusion and danger.
These time zones are still in effect today.

31. The Railroad Industry
The government tried to encourage railroad development by offering land grants.
Companies received land around the track they laid.
They would resell the land for profit.
Some people took unfair advantage of these grants.

32. The Railroad Industry
People who loot an industry and give nothing back are called robber barons.
Jay Gould practiced “insider trading” to his advantage.
Companies often bribed congressmen to offer more land grants.

33. The Credit Mobilier Scandal
The Union Pacific Company hired an outside company—Credit Mobilier—to actually build the tracks.
Credit Mobilier overcharged for their services.
Most of the money became the profit of the investors.
When they needed more money, they bribed congressmen for support.

34. The Credit Mobilier Scandal
The congressmen bought stock in Credit Mobilier at a “discounted” price.
The corruption was eventually investigated.
Even a future U.S. president was involved (James Garfield).
Despite scandals like this one, some people earned profits fairly and effectively.

35. The Great Northern
The Great Northern Railroad did not receive federal support.
It was run by James J. Hill.
Hill was not a robber baron.
The Great Northern became the most successful transcontinental railroad.
It was also the only one that was not forced to file for bankruptcy.

36. 14.3 Big Business Economics Andrew Carnegie Monopolies and Trusts

37. Chapter Standards ACOS:
1.) Explain the transition of the United States from an agrarian society to an industrial nation prior to World War I.
AHSGE Standard V:
1. Identify and evaluate the events that led to the settlement of the West.
2. Evaluate the concepts, developments, and consequences of industrialization and urbanization.

38. Economics Corporations began to form.
A corporation is an organization owned by many people but treated by the law as if it were one person.
Corporations became bigger and achieved economies of scale.
Economies of scale refers to the reduction of costs as a result of increased production at a given facility.

39. Economies of scale result in reduced costs and prices.
Economics
Economies of scale result in reduced costs and prices.

40. Economics All businesses have fixed costs and operating costs.
Fixed costs are costs the company has to pay no matter what.
Operating costs are costs that occur when running a company,
These costs can change depending on production.

41. Economics
Smaller corporations with high operating costs find it hard to compete with larger ones.
Many are forced out of business by the larger corporations.

42. Andrew Carnegie Carnegie was poor but became successful.
He invested in companies that supported the railroad industry.

43. Andrew Carnegie Carnegie also used the Bessemer Process.
Sir Henry Bessemer invented a new process for making high quality steel efficiently and cheaply.
Carnegie opened a steel company in Pittsburgh.

44. Andrew Carnegie
Carnegie began the vertical integration of the steel industry.
A vertically integrated company owns all the different businesses it uses for operation.
It saved the company money.

46. Andrew Carnegie He also supported horizontal integration.
This is the combining many firms engaged in the same type of business into one large corporation.
John D. Rockefeller used horizontal integration also.
John D. Rockefeller

47. Click the mouse button or press the Space Bar to display the answer.

48. Monopolies and Trusts
Rockefeller’s Standard Oil Company controlled 90% of American oil refining industry.
Rockefeller created a monopoly.
A monopoly happens when a company achieves control of an entire market.
Monopolies are now illegal.

49. Monopolies and Trusts Standard Oil then created the first trust.
A trust is a legal concept that allows a person to manage another’s property.
A trustee is the person who manages the money.
This allowed Rockefeller to control the other companies without actually owning them.

50. Business The advertising industry grew as the business industry grew.
Department stores offered many services in a fancy environment.
Chain stores offered lower prices without the elaborate service and decor.
Rural people shopped from mail order catalogues like Montgomery Ward and Sears, Roebuck.

51. Read about this moment in history on page 450.

52. You’re the Historian! Investigating Standard Oil
Read pages
On a separate sheet of paper, write the question and answer to the three questions under “Understanding the Issue.”

53. 16.4 Unions Working in the United States Early Unions
The Struggle to Organize
The American Federation of Labor
Working Women

54. Chapter Standards ACOS:
1.) Explain the transition of the United States from an agrarian society to an industrial nation prior to World War I.
AHSGE Standard V:
1. Identify and evaluate the events that led to the settlement of the West.
2. Evaluate the concepts, developments, and consequences of industrialization and urbanization.

55. Working in the United States
Working conditions were poor.
Long hours
Poor environment
Dangerous machinery
Low wages
Industrialism increased the standard of living.
Deflation during the late 1800s caused prices to fall.
Wages were also cut.

56. Early Unions There were two types of industrial workers:
Craft workers had special skills and training. (ex: machinists, iron molders, carpenters)
Common laborers had few skills and received lower wages.
Craft workers began to form trade unions—unions limited to people with specific skills.
Employers typically hated unions.

57. Early Unions
Industrial unions united craft and common workers in a particular industry.
Employers tried to undermine the unions by:
Making employees sign oaths not to join a union.
Firing workers who joined unions.
Hiring strikebreakers to replace workers on strike.

58. Early Unions Employers also organized lockouts.
A lockout is a technique for breaking a union in which the company refused to allow the workers on the property and refused to pay them.

59. Early Unions Employers thought unions promoted communism.
Karl Marx, the founder of communism, argued, “The basic force shaping capitalism is the class struggle between workers and owners.”
Increased immigration increased fears of political unrest.

60. The Struggle to Organize
Railroad workers went on strike and blocked the tracks in the Great Railroad Strike of 1877.
Violence erupted following the strike.
President Hayes ordered the army to stop the violence.
Peace was restored.

61. The Struggle to Organize
The first nationwide industrial union was the Knights of Labor.
It pushed for better working conditions and wages.
They used boycotts, arbitration, and eventually strikes.
The Haymarket Riot undermined the Knights when police arrested one of their members for bombing police at a protest meeting.

63. The Struggle to Organize
The Pullman Strike nearly crippled the economy.
Railroad workers created the American Railway Union (ARU) in 1893.
Eugene V. Debs led the ARU.
The Pullman Company was part of the union.
Three workers were fired for protesting cut wages.

64. The Struggle to Organize
The union organized a strike.
Railroad managers attached the U.S. Mail cars to their Pullman cars.
When mail delivery was disrupted, President Cleveland issued an injunction ordering the union to stop the boycott.

65. The American Federation of Labor
The AFL was first led by Samuel Gompers.
It rejected socialism.
The AFL fought for higher wages and better working conditions.

66. Working Women
The number of women in the work force increased after the Civil War.
Women were paid less than men.
Most unions excluded women.
The Women’s Trade Union League (WTUL) was the first national association promoting women’s labor issues.

67. Test Tomorrow!