Industrial AmericaSteel is critical to industrialization – new method for steel production during this time:Bessemer Process – a day’s worth of production before now took 15 minutes.

New inventions revolutionized American life:Thomas Edison – electric light bulbAlexander Graham Bell – telephone

Railroads continued to grow:Transcontinental Railroad grew from the East and West. Immigrants did much of the work. In the West, many of these immigrants were Chinese.

Goods and people could now move on a continental scale. Railroads carried the growing population into unsettled parts of the West.

Corporate America

Entrepreneurs started businesses and sometimes they grew very large, into corporations that sold stocks to shareholders.

During the Gilded Age, some called the corporate leaders “Captains of Industry” because they helped create modern industry. However, others called them “robber barons” because they created monopolies, or used other tactics to destroy competition and keep worker’s wages low.

Monopoly: company having complete control over the supply of a product or service.

Corporate America

Andrew Carnegie John D. Rockefeller

• Created a huge steel company

• Donated $350 million through philanthropy

• Created a huge oil company

• Standard Oil was broken up by the government

Corporate America

Pros of Big Business Cons of Big Business

• Higher efficiency → lower prices

• Hire many workers• Produce large

quantities of goods• Lots of resources

for innovation

• Unfair competitive advantage

• Exploit workers• Sometimes pollute

the environment• Have unfair influence

over government policies & regulations

American Workers

• Long hours & low wages• Poor working conditions• Boring, repetitive tasks• Child labor common• No job security, benefits or worker’s compensation

This leads to the formation of unions, where groups of workers organize and strike to get better working conditions:

Knights of Labor – union made up of skilled and unskilled workers.

American Federation of Labor (AFL) – group of unions made up of skilled workers (carpenters, welders, etc.)

American Workers

Sometimes, actions between industries and unions got tense and even violent:

In 1886, labor union leaders were blamed for a bomb exploding in Haymarket Square in Chicago.

In 1892, striking union members and Andrew Carnegies hired security forces waged war at the Homestead, PA plant.

Government Action

Believers in laissez-faire thought the government should let businesses do whatever they wanted. However, competition is necessary to free market capitalism, so the government took action:

Interstate Commerce Act (1887) – federal law prohibiting railroads from offering lower transportation costs to big businesses.

Sherman Anti-Trust Act (1890) – Federal law meant to stop monopolies form using unfair practices that prevented fair competition.