Chapter 14: Industrial AgeChapter 14: Industrial Age1870 - 19001870 - 1900

Introduction Edwin Drake Henry Bessemer

Thomas A. Edison George Westinghouse Chris Sholes: 1867 Telephone: 1876 Transcontinental Railroad:

1869 Immigrants Regulation George Pullman Credit Mobilier: 1864 Interstate Commerce Act:

1887• Intrastate Trade

Social Darwinism• Success

Horatio Alger Jr. Monopoly Trust Octopus Andrew Carnegie

• Gospel of Wealth

J.P. Morgan• Holding Company

Vanderbilt John D. Rockefeller

• Cut Throat Competition Robber Barons Sherman Anti-Trust Act 1890 Working Conditions Mother Jones Unions National Strike 1877

• Yellow Dog Contracts Knights of Labor (KoL)

• Arbitration Haymarket Square Riot 1886 American Federation of Labor

(AFL)• Collective Bargaining

Eugene Debs Government & Business Injunction Results of Injuctions

IntroductionIntroduction

During the late 1800s, the United States will During the late 1800s, the United States will experience a 2experience a 2ndnd Industrial Revolution Industrial Revolution that will change that will change American industryAmerican industry

Problems in the work place will be addressed by Problems in the work place will be addressed by the creation of labor unions & the federal governmentthe creation of labor unions & the federal government

Bessemer & DrakeBessemer & Drake Oil Drill: Invented by Edwin

Drake.

Effects: Drilling for oil becomes more practical• New use for the steam engine• Gasoline

Steel Production – “The Bessemer Process”: Invented by Henry Bessemer

Effects: Large scale building – cities

Many new inventions• Plow, windmill, skyscrapers,

barbed wire• Efficient & cheap

Steel more flexible & stronger, won’t rust if made properly

New Uses for SteelNew Uses for Steel

Railroad biggest consumer• Tracks & Spikes

Barbed wire, Mechanical reaper, John Deere’s Plow

Tin can Brooklyn Bridge built in

1883• Many were unsure of its

safety so Barnum (the circus guy) marched elephants across it to prove its strength

Jenney: 1st skyscraper• Home Insurance Bldg.,

Chicago

Incandescent Light BulbIncandescent Light Bulb Invented by Thomas A. Edison

• Safer than the arc light Effects: Safer form of

electricity 1,000s of inventions

• Phonograph• Microphone• Stock ticker• Projecting Kinetoscope• Galvanized batteries

Electrical Distribution System: Invented by George Westinghouse

Effects: Safer & cheaper way to distribute electricity long distance

TypewriterTypewriter18671867

Invented by Chris Sholes Created jobs for women Letter arrangement was changed because workers were typing too fast!

Telephone: Telephone: 18761876

Invented by Alexander Graham Bell & Thomas Watson

Considered toys at 1st until its usefulness was proved

Quicker & more efficient communication

More jobs for women• Telephone operators

– Why not men?

1910: Women made up 40% of the clerical workforce

Changes in SocietyChanges in Society

Consumer becoming important part of business• More products on the

marker & we’re buying more stuff

More recreational activities like the phonograph, bikes & cameras become popular

How to balance industrialization & environmental pollution?

Social DarwinismSocial Darwinism Survival of the fittest in

business• Big business naturally takes

over smaller businesses Darwin’s Origin of Species

• Process of Natural Selection

Sumner: Success & failure in business were governed by natural law that no one (gov’t) had right to interfere.

Favors a Laissez-Faire Gov’t where the gov’t. doesn’t control industry

New definition of success: God gave $ to deserving & the poor were lazy

New Business Practices:New Business Practices:Horizontal MergerHorizontal Merger

Merging companies that Merging companies that make similar productsmake similar products

Shell Gas

Hess Gas

Exxon Gas

BP Gas

New Business Practice:New Business Practice:Vertical MergerVertical Merger

1 company takes over 1 company takes over the suppliers, the suppliers, distributors, & distributors, & transportation system to transportation system to gain control of the entire gain control of the entire industryindustry

Oil Drills

Oil Refineries

Oil Pipelines

Oil Trucks

Stations

New Business PracticesNew Business Practices

Oligopoly: Only a few sellers provide particular product• Usually result of merger

Monopoly: 1 company dominates the market = no competition• Buy out all competitors to control market (production,

quality, sales)• Prices go up!!

Trust: Same as monopoly

Octopus represented

trusts & monopolies in

political cartoons

Big BusinessBig Business

Powerful Powerful industriesindustries• OilOil• SteelSteel• RailroadRailroad

Very involved Very involved in Gov’t. in Gov’t.

Andrew CarnegieAndrew Carnegie

Made $ in steel Made $ in steel industry industry

Founded US Steel Founded US Steel Co.Co.

1901: Controlled 1901: Controlled 80% steel industry80% steel industry

Nearly monopolized Nearly monopolized steel industrysteel industry

Gospel of Wealth: Rich had a social Rich had a social obligation to help the obligation to help the poor & the poor & the communitycommunity

John D. RockefellerJohn D. Rockefeller

Standard Oil Company

90% oil refining industry

Didn’t share benefits w/employees, paid low

Used Cut Throat Competition: Drive competitors out of business by lowering prices…• Once the competition is

weak, her buys them & raises prices again!!

Control market, then raised prices• No alternative

J.P. MorganJ.P. Morgan

Made $ from banking & bought out many railroads

Holding Company: Buy stock of competing companies until it controls the majority

1900: control 50% of RxR in US

Cornelius VanderbiltCornelius Vanderbilt

Made money Made money from the from the railroadsrailroads

Charged very Charged very high prices in high prices in the Westthe West• Poor farmers Poor farmers

Built luxury railroad cars (Pullman Sleeper Cars)

Creature comforts• Plush chairs,

temperature control etc.

Company Town: Employees forced to live in Pullman town…keeps them in debt to the company

TitlesTitles

Captains of Captains of IndustryIndustry

Name given to Name given to industry industry leadersleaders

Robber Robber BaronsBarons

Monopolists Monopolists who used who used unfair/cut unfair/cut throat tacticsthroat tactics

Credit Mobilier: 1864Credit Mobilier: 1864

Railroad scandal linked to Grant’s VP One of the many reasons Northerners stopped

paying attention to the South

Interstate Commerce Act: Interstate Commerce Act: 18871887

Not enforced at 1st; until T. Roosevelt

Federal Gov’t. can supervise railroads & regulate interstate trade• Trade between states

Interstate Commerce Commission established to supervise, but difficult job• Too much paper work (red

tape)

Horatio Alger Jr.Horatio Alger Jr.““Pulling yourself up form the

bootstraps”

Not everyone agreed w/Social DarwinismWrote dime novels: rags to riches storiesNo shame in humble beginningsPeople looked differently at poor

•Fault of individual, not economy

Other MonopoliesOther Monopolies

Charles PillsburyCharles Pillsbury• FlourFlour

RJ ReynoldsRJ Reynolds• TobaccoTobacco

J.B. DukeJ.B. Duke• TobaccoTobacco

All southern monopoliesAll southern monopolies

Monopolists who used cut throat competition

Defending themselves by contributing to charity: most gave very little

Carnegie gave 90% of earning (he was the exception to the rule)

Sherman Anti-Trust ActSherman Anti-Trust Act18901890

Fighting back against monopolies• Drive prices up – many farmers, workers & poor can’t

afford products

Stated any attempt to interfere with free trade was illegal• Monopolies, but later included strikes & workers’ union

Used to break up monopolies

Weak at 1st• Supreme Court didn’t support, monopolies continued

Used to control Unions

Working ConditionsWorking Conditions

UnsafeUnsafe working working conditionsconditions• Low pay ($3-$12 Low pay ($3-$12

week)week)• Long hours (16)Long hours (16)• No sick, vacation No sick, vacation

workman’s comp.workman’s comp.– Injuries commonInjuries common

– 1882: 675 died 1882: 675 died weeklyweekly

1890-1917: 1890-1917: 200,000+ workers 200,000+ workers killed, 2 mil. injuredkilled, 2 mil. injured

Triangle Shirtwaist Co. Triangle Shirtwaist Co. 19111911

Fire spread throughout Fire spread throughout factoryfactory

Workers tried to escape, Workers tried to escape, but doors were lockedbut doors were locked

No sprinkler systemNo sprinkler system Fire escape collapsedFire escape collapsed 154 dead154 dead Owner acquittedOwner acquitted ResultsResults

• Established Fire codesEstablished Fire codes• Abolished child laborAbolished child labor• Sunday offSunday off• 54 hour work week54 hour work week

Child LaborChild Labor

Cheap - .27 cents Cheap - .27 cents dayday

Could fit in machines Could fit in machines to fixto fix

20% children working 20% children working – no school– no school

Chained to machinesChained to machines Hunger & exhaustion Hunger & exhaustion

lead to accidentslead to accidents OverheadsOverheads

Mother JonesMother Jones

Called for reforms Called for reforms in child laborin child labor

Brought situation Brought situation to public eyeto public eye

Widespread Widespread publicitypublicity

Emergence of UnionsEmergence of Unions

Formed to protect rights of laborersFormed to protect rights of laborers

Against immigrants because they could take Against immigrants because they could take American jobs (Work for less $)American jobs (Work for less $)

National StrikeNational Strike18771877

Strike against the railroads

1st national strike

Federal troops sent to stop strikers• Interfering with free trade,

stopped 50,000 miles of track

Protesting long hours, bad pay

Supported by miners (experiencing same things)

To keep their jobs, strikers were forced to sign Yellow Dog Contracts• Would not join a union or

strike

Knights of Labor (K.o.L.)Knights of Labor (K.o.L.)

Focused on individuals “Injury to one, hurts us all” Union opened to skilled & unskilled laborers; minorities Used arbitration: to settle disputes

• unbiased 3rd party settles disagreement Used strikes

Haymarket RiotHaymarket Riot5/4/18865/4/1886

Chicago Protesting the death of

striker by cops Cops show up Bomb thrown into

crowd Leads to decline of K. o.

L.• Anarchists linked to

Knights of Labor• Public turns against them

because of violence• Creation of AFL

American Federation of Labor American Federation of Labor (AFL)(AFL)

Founded by Samuel Gompers

Union open to only skilled workers

No minorities

Used collective bargaining to settle disputes• Group negotiations • Done before striking

Raised wages, shortened work week

Different tactics used by K.O.L & AFL

Socialist Union leaderSocialist Union leader

Dignity & solidarityDignity & solidarity

Wanted separate Wanted separate unions for skilled & unions for skilled & unskilled laborers of unskilled laborers of different tradesdifferent trades• Miners union, Miners union,

Electricians union etc.Electricians union etc.

Threatened wealthy, Threatened wealthy, supported by poorsupported by poor

Pullman StrikePullman Strike

Laid off 3,000 workersLaid off 3,000 workers Cut wages by 40% Cut wages by 40%

• Making $6 a weekMaking $6 a week Rent high in company Rent high in company

towntown Workers on strikeWorkers on strike Strikebreakers hired by Strikebreakers hired by

Pullman (Pinkertons)Pullman (Pinkertons) Violence eruptedViolence erupted

• Debs jailedDebs jailed• Strikers fired & Strikers fired &

BlacklistedBlacklisted

Government & BusinessGovernment & Business

Gov’t. supports businessInjunction: Court order (in this case) to prohibit strikes

Results of InjunctionsUnions began to decline early 1900sLost support, strikes caused shortage of goodsLosing members