American Industrialization

American American IndustrializationIndustrialization

Edwin L. DrakeEdwin L. Drake 18591859 Titusville, PATitusville, PA Drilled for oil using Drilled for oil using

steam powered engine.steam powered engine. Cheaper and more Cheaper and more

efficient way to obtain efficient way to obtain oil.oil.

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Drake’s WellDrake’s WellTitusville,Titusville,

PennsylvaniaPennsylvania18591859

Produced 10 Produced 10 barrels per barrels per

dayday

Thomas EdisonThomas Edison 1880 improved the filament in light 1880 improved the filament in light

bulbs (bamboo fiber).bulbs (bamboo fiber). 1882 built first power plant that lit 1882 built first power plant that lit

dozens of buildings in NYC.dozens of buildings in NYC. Used direct current which could Used direct current which could

only travel short distances.only travel short distances. Received over 1090 patents from Received over 1090 patents from

U.S. Govt.U.S. Govt.

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Thomas EdisonThomas Edison

Thomas EdisonThomas Edison

Thomas EdisonThomas Edison

George WestinghouseGeorge Westinghouse

Ω 18851885Ω Used alternating current (AC).Used alternating current (AC).Ω Cheaper & traveled longer distance than Cheaper & traveled longer distance than

direct current (DC).direct current (DC).Ω Invented the transformer to boost or Invented the transformer to boost or

reduce the power level as needed.reduce the power level as needed.Ω Made home electricity use practical.Made home electricity use practical.

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Samuel F. B. MorseSamuel F. B. MorsePerfected the telegraph (did not Perfected the telegraph (did not

invent it).invent it).1844 – sent first telegraph 1844 – sent first telegraph

message.message.Morse Code – short & long Morse Code – short & long

electrical impulses to represent electrical impulses to represent letters of the alphabet.letters of the alphabet.

Began a communication revolution.Began a communication revolution.

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The TelegraphThe Telegraph

Morse CodeMorse Code

Alexander Graham BellAlexander Graham Bell

1876 – Patented the “talking telegraph.”

1885 – Set up the American Telephone & Telegraph Company (AT&T) to build long distance telephone lines.

1900 – 1.5 million telephones in use in America.

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The earliest “talking The earliest “talking telegraphs”telegraphs”

The latest “talking The latest “talking telegraphs”telegraphs”

Henry BessemerHenry Bessemer 1856 – received first patent for the 1856 – received first patent for the

“Bessemer process.”“Bessemer process.” Made production of steel from iron Made production of steel from iron

faster and cheaper.faster and cheaper. Mass production of steel allowed Mass production of steel allowed

the building of skyscrapers, the building of skyscrapers, railroad rails, and large suspension railroad rails, and large suspension bridges (Brooklyn Bridge 1883).bridges (Brooklyn Bridge 1883).

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Andrew CarnegieAndrew Carnegie Born in Scotland.Born in Scotland. Immigrated to U.S. when 12.Immigrated to U.S. when 12. Worked as a bobbin boy in a Worked as a bobbin boy in a

textile mill.textile mill. Created Carnegie Steel.Created Carnegie Steel. Became wealthiest man in U.S.Became wealthiest man in U.S. “ “Gospel of Wealth” philosophy.Gospel of Wealth” philosophy.

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Andrew CarnegieAndrew Carnegie

Brooklyn bridgeBrooklyn bridge

Gospel of Wealth People should be free to make as People should be free to make as

much money as possible, but much money as possible, but should give most of it away to should give most of it away to improve society as a whole.improve society as a whole.

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John D. RockefellerJohn D. Rockefeller• Son of a poor street peddler in NYC.Son of a poor street peddler in NYC.• Invested in a grain and meat partnership Invested in a grain and meat partnership

during Civil War.during Civil War.• 1870 – joined with other businessmen to 1870 – joined with other businessmen to

form the Standard Oil Company of Ohio.form the Standard Oil Company of Ohio.• 1882 – joined Standard Oil stock with 40 1882 – joined Standard Oil stock with 40

other oil companies to form Standard Oil other oil companies to form Standard Oil Trust.Trust.

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John D. RockefellerJohn D. Rockefeller

John D. Rockefeller &

John D. Jr. 1921

Railroads

Transcontinental railroad

1862-1869 Railway extending from the east to the

west coast. Funded by the U.S. government. Irish immigrants worked from the East. Chinese immigrants worked from the

West. Completed about 8 miles of track per

day. Tracks met at Promontory Point, Utah.

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Transcontinental railroad

Central Pacific Locomotive #1

Transcontinental Railroad“Driving of the Golden Spike”

Transcontinental Railroad Route

Promontory Point, Utah

Significance of Railroads

Faster, cheaper way to move people and products.Connects isolated markets.Encourages other industry to develop. 50% of steel and 20% of coal produced went to the RR’s.

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Railroad Corruption

Overcharged customers.

Rebates to favored customers.

Charged more for a short-haul than a long-haul.

Kept rates secret and charged different customers different amounts for the same service.

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Interstate Commerce Act

1887 - Regulated the prices railroads charged to move freight between states - based on distance traveled. Outlawed special rates. Showed that Congress had the power to regulate interstate trade. Established the Interstate Commerce Commission.

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The Growth of

BIG Business in America

Social Darwinism

• Philosophy that applied Charles Darwin’s theory of “survival of the fittest” to the business world.

• The most “fit” businesses would grow and prosper and the “unfit” ones would fail.

• So government should stay out of the affairs of business and let the process of “natural selection” operate.

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New Types of Business

Structures

Oligopoly•A type of market structure in

which a particular product is produced by only a few large profitable companies.

•Examples: automobiles, breakfast cereals, appliances.

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Monopoly• Complete control of a product or

service by one company.• Happens when one company

forces its competition out of business or buys them out.

• Bad for consumers because without competition, a company could charge unreasonable prices.

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Trust• A type of business monopoly.• Instead of one business buying out

the competition, several companies combine their assets and give control to a “board of trustees.”

• How J.D. Rockefeller controlled most of the oil in America without technically violating the law.

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Vertical Consolidation

• When a company owns all the businesses that make up the phases of a product’s manufacture.

• Example: Carnegie’s steel empire – He owned the iron ore mines, the coal mines, the steel mills, the ships and railroads – EVERYTHING. involved in making and shipping steel (from the ground up).

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Vertical Consolidatio

n

Carnegie’s business structure

Horizontal Consolidation

• The joining of many firms engaged in the same business so that you have no competition.

• Example: Rockefeller acquired all the independent oil refineries that had been his competitors.

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Horizontal Consolidation

Rockefeller’s business structure

Economies of Scale

As production increases, the cost of each item decreases. (The more of something a company makes, the cheaper the product becomes.)

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Problems with Industrializatio

n

Harsh Working Conditions

•Workers fined or fired for being late or talking

•Unsafe •Deafening noise •Poor lighting and ventilation•Frequent fires and accidents

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continued

Harsh Working Conditions

•500,000 workers were completely disabled each year .

•35,000 killed each year.•No corporate accountability for

worker safety. No workers’ compensation laws or insurance.

•You get hurt, you get fired.

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Sweatshops•A shop where

employees worked long hours under poor working conditions for low wages.

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Child Labor

Child Labor

Child Labor•No child labor laws existed.•Children as young as 6 could work in a factory.

•Many children left school at 12 to go work permanently just so families could eat.

•Many were injured or killed.

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Responses to these

Problems

SocialismAn economic and political

philosophy which proposes:Wealth should be distributed

equally to everyone;People should cooperate, not

compete in producing goods;Society as a whole, not just a

few private individuals should have control of a nation’s wealth.

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Labor Unions

Groups of workers with similar jobs that join together to fight for better working conditions

higher pay

more benefits

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Collective Bargaining

Workers negotiate as a group with employers.

One or two are chosen as spokesmen for the group.

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StrikeA tactic in which workers refuse to work until their demands are met by management.

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Strikers on a Picket Line

ScabsNon-union workers hired by management to take the place of striking workers.

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Knights of Labor• Formed in 1869 by Terrence Powderly • Joined all workers together (men, women,

all races, and all trades) • Used education and political action to

achieve these goals: Equal pay for equal work 8-hour work day End to child labor

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Knights of Labor

Charter

Knights of Labor

print featuring founder

Terrence Powderly

In the beginning, God ordained that man should labor, not as a curse, but as a blessing; not as a punishment, but as means of development, physically, mentally, morally, and has set thereunto his seal of approval in the rich increase and reward. By labor is brought forward the kindly fruits of the earth in rich abundance for our sustenance and comfort; by labor (not exhaustive) is promoted health of the body and strength of mind, labor garners the priceless stores of wisdom and knowledge. It is the “Philosopher’s Stone,” everything it touches turns to wealth. “Labor is noble and holy.” To glorify God in its exercise, to defend it from degradation, to divest it of the evils to body, mind, and estate, which ignorance and greed have imposed; to rescue the toiler from the grasp of the selfish is a work worthy of the noblest and best of our race.You have been selected from among your associates for that exalted purpose. Are you willing to accept the responsibility, and, trusting in the support of pledged true Knights, labor, with what ability you possess, for the triumph of these principles among men?

Knights of Labor Creed

American Federation of Labor (AFL)

Formed in 1886 by Samuel Gompers. Used strikes and boycotts to achieve their

goals. Craft-based union. Not open to everyone. Focused on wages, hours, and working

conditions.

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American Federation of Labor Emblem

Samuel Gompers

The Wobblies Industrial Workers of the World (IWW) Founded in 1905 by a socialist, Eugene V.

Debs. A radical union that used violence during

strikes. Goal was the world-wide destruction of

capitalism by labor forces.

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Eugene V. Debs, Founder of the IWW

The Wobblies (IWW)

Employer Responses to Unions

Employers resisted unionization because they feared it would drive costs up.

Forbad meetingsFired union organizersForced employees to sign a contract

pledging not to join a union Refused to bargain collectivelyRefused to recognize unions

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Labor Unrest Leads to Violent Confrontations Between Management

and Labor

Pinkertons A police force for hire Founded by Samuel Pinkerton The first secret service agency

protecting Lincoln. Known for their ability to break

up strikes.

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Pinkerton’s National Detective Agency

Great Railroad Strike of 187734

Baltimore and Ohio RR announced a 10% wage cut.

Train lengths were doubled, increasing the chance of accidents.

RR workers in Pittsburg, PA struck. The strike turned into a violent riot. Soldiers fired on rioters who responded by

burning RR property.

Railroad Strike of 1877

Railroad Strike of 1877

Railroad Strike of 1877

Railroad Strike of 1877

Railroad Strike of 1877

Railroad Strike of 1877

Haymarket Riot (1886) Workers struck for an 8-hour workday. At a rally in Haymarket Square in Chicago, on

May 4, anarchists joined the strikers. Someone threw a bomb into the group of 170

armed police guards. Dozens were killed in the gunfight that followed. Four anarchists were hanged; the others were

pardoned. We don’t know who threw the bomb.

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Haymarket Riot (1886)

7 officers killed in Haymarket Riot

People Involved in the Haymarket Riot (1886)

Anarchist Rally held the day

after the Haymarket

Riot

Haymarket anarchists on their way to the gallows

Gallows for the

Haymarket Anarchists,

Nov. 11, 1887

Haymarket Riot Postcard

Haymarket Riot Monument 1997

Homestead Strike (1892) William Frick tried to cut wages at

Homestead Steel Works in PA while Carnegie was in Scotland.

Union workers struck. Frick called in the Pinkertons who opened

fire on the strikers. Soldiers called in to quell the strike. Dozens killed After an assassination attempt on Frick’s life,

the union surrendered.

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Carnegie’s Homestead Steel Works

Pinkertons Arriving by Barge

Federal Troops Called In

Pullman Strike (1894)George Pullman built the first luxury “sleeper”

rail carsHis Chicago workers lived in the “company

town” used “company script” as money at the “company store”

During an economic depression, Pullman cut wages and laid-off workers but did not cut rent.

When workers protested, he fired them, causing a strike.

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continued

Pullman Strike (1894)Other RR unions in 23 states joined in

More than a 1000 rail cars were destroyed13 workers killed

RR service to the western half of the country is disrupted, including mail service.

Owners banded together and sought court orders to halt any union activity that interfered with the delivery of the mail.

Union leader Eugene V. Debs was imprisoned

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George Pullman

Pullman Strike (1894)

Pullman Strike (1894)

Pullman Strike (1894)