THE AGE OF INDUSTRY

1865 TO 1900

AN INTRODUCTION

BETWEEN 1865 & 1900 AMERICA WAS TRANSFORMED.

A RURAL NATION BECOMES URBAN AND INDUSTRIAL

SYMBOL OF THE AGE- THE BROOKLYN BRIDGE.

STEEL WAS THE FOUNDATION

MORE… MANY NEW INVENTIONS NEW FORMS OF BUSINESS

ORGANIZATION BIRTH OF THE ROBBER BARONS HORRIBLE WORKING

CONDITIONS

THE TIES THAT BIND. 1844 SAMUEL MORSE INVENT THE

TELEGRAPH BY 1860 EAST & WEST ARE CONNECTED.

1866 WESTERN UNION & AMERICAN TELEGRAPH MERGE.

MORE... 1858- CYRUS FIELDS - ATLANTIC

CABLE. 1866 STRONGER CABLE.

THE TELEPHONE- 1876 ALEXANDER GRAHAM BELL “WATSON I WANT YOU!”….. 1877 FIRST LONG DISTANCE

BOSTON TO NEW YORK BELL TELEPHONE COMPANY 1877 1885 AMERICAN TELEPHONE &

TELEGRAPH COMBINE

RAILROAD TRANSPORTATION SINGLE MOST IMPORTANT TIE TO

INDUSTRIAL EXPANSION. 1860- 30,000 MILES OF TRACK IN

AMERICA. NO BRIDGES OVER THE

MISSISSIPPI NO STANDARD GAGE.

RAILROAD CONSOLIDATION

1866 CORNELIUS VANDERBILT CREATES NEW YORK CENTRAL

BY 1877 VANDERBILT CONTROLS 4,500 MILES OF TRACK.

IN 1886 RAILROADS ADOPT A STANDARD GAGE.

VANDERBILT INTRODUCES STEEL RAILS & AIR BRAKES

MORE… 1883- AMERICAN RAILROAD

ASSOCIATION DIVIDES NATION INTO 4 TIME ZONES.

EASTERN, CENTRAL, MOUNTAIN, AND PACIFIC.

PERSISTENT PROBLEMS FINANCING RAILROAD

CONSTRUCTION BONDS AND STOCK CERTIFICATES-

BUT FEW ACTUAL ASSETS. CUTTHROAT COMPETITION (E.G.

BETWEEN ATLANTA & ST. LOUIS 20 DIFFERENT CARRIERS.

MORE… RATE WARS LEAD TO REBATES POOLING AGREEMENTS NOT TO

COMPETE. LONG HAUL / SHORT HAUL

ABUSES.

SOME INVENTIONS OF THE PERIOD. BETWEEN 1880 &1890 21,000 NEW

PATIENTS PER YEAR. BELL’S TELEPHONE ESTABLISHES

A WHOLE NEW INDUSTRY LEVI STRAUSS - DEVELOPES BLUE

JEANS.

STEEL PRODUCTION 1859 HENRY BESSEMER AND

WILLIAM KELLY FIND NEW METHOD OF STEEL PRODUCTION.

BESSEMER PROCESS - BLAST FURNACE

1867- U.S. PRODUCED 2000 TONS PER YEAR.

MORE… BY 1900 WE PRODUCE 7

MILLION TONS PER YEAR. STEEL BECOMES THE

BACKBONE OF THE INDUSTRIAL REVOLUTION.

SKY SCRAPERS BEGIN TO APPEAR. (20 STORIES HIGH) LUIS

SULLIVAN

INVENTIONS START MORE INDUSTRY GUSTAVUS SWIFT & PHILIP

ARMOUR - MEATBACKING INDUSTRY

GEORGE PULLMAN 1864 - INVENTS THE SLEEPING CAR.

GEORGE WESTINGHOUSE 1868 INVENTS AIR BRAKES

MORE… CHRISTOPHER SHOLES- 1875 THE

TYPEWRITER. THE THE REMINGTON FIRE ARMS COMPANY.

1852 ELISHU OTIS - INVENTS THE ELEVATOR. PERFECTED BY FRANK SPRAGUE.

THOMAS ALVA EDISON - 1847 TO 1931 “THE WIZARD OF MENLO PARK.” HELD OVER 1000 PATIENTS IMPROVED TELEGRAPH, TICKER

TAPE FOR STOCK MARKET PHONOGRAPH 1877 1879 INCANDESCENT ELECTRIC

LAMP

MORE ON EDISON... VITASOPE ( MOTION PICTURE

DEVICE) STOREAGE BATTERY, ELECTRIC

MOTOR, ELECTRIC LOCOMOTIVE 1877 FOUNDED EDISON GENERAL

ELECTRIC. LATER BECAME GENERAL ELECTRIC CORP.

BUSINESS PHILOSOPHY BY 1900 THERE WERE 4000

MILLIONAIRES RICH PRACTICES CONSPICUOUS

CONSUMPTION

ANDREW CARNEGIE’S “GOSPEL OF WEALTH” “I HAVE A RIGHT TO MAKE MONEY

& A RESPONSIBILITY TO SPEND IT PROPERLY.”

RICH ARE GOD’S STEWARTS ON EARTH.

WEALTHY MUST USE MONEY TO IMPROVE SOCIETY.

SOCIAL DARWINISM HERBERT SPENCER OF ENGLAND

APPLIES DARWINISM TO SOCIETY. WEALTHY ARE PRODUCTS OF

“NATURAL SELECTION.” WILLIAM GRAHAM SUMNER (YALE

COLLEGE) AMERICAN PROPONENT.

LAISSEZ- FAIRE ECONOMICS REJECTS GOVERNMENT INVOLEMENT IN

THE ECONOMY MARKET MECHANISM OF SUPPLY &

DEMAND IS BEST WAY TO MAKE CHOICES. COMPETITION WILL PROTECT

CONSUMERS ACCEPTED GENERALLY BY RICH AND

POOR

HORATIO ALGER.

HORATIO ALGER STORIES DIME NOVELS TELL STORY OF YOUNG

MAN WHO MAKES GOOD THROUGH HARD WORK & DETERMINATION. “LUCK & PUCK.”

“RAGGED DICK” “THE ERRAND BOY: HOW PHIL WON

SUCCESS” SUPPORTS THE AMERICAN DREAM.

NEW WAYS OF DOING BUSINESS SIZE IS HALLMARK OF THE TIME. GNP GROSS NATIONAL PRODUCT

GROWS. IN 1860 = $1.8 BILLION. BY 1890 = $10 BILLION.

AIM OF BUSINESS INCREASE PROFITS, CUT COSTS & REDUCE COMPETITION

ADVANTAGES OF CORPORATIONS LIMITED LIABILITY POOL CAPITAL LEGAL STATUS OF “PERSON”

UNDER THE 14TH AMENDMENT IMMORTAL PROFESSIONAL MANAGEMENT

CORPORATIONS DOMINATE MOST KEY INDUSTRIES.

IRON, STEEL, COAL, RAILROADS, COPPER, ELECTRICITY, TELEPHONE, TEXTILES, BANKING & CHEMICALS.

CARNEGIE AND ROCKEFELLER CARNEGIE DEVELOPS A VERTICAL

MONOPOLY IN STEEL CONTROLS ALL ASPECT OF STEEL

PRODUCTION AND SALES HE IS MODEL FOR HORATIO ALGER

STORIES. FIRST TO ADOPT BESSEMER

PROCESS.

JOHN D. ROCKEFELLER 1859- TITUSVILLE FIRST OIL WELL. OIL USED TO

MAKE KEROSENE FOR LAMPS. ROCKEFELLER SEE REFINING AND

TRANSPORTING OIL AS THE KEY. ESTABLISHES A HORIZONTAL MONOPOLY CONTROL ONE KEY STEP IN PRODUCTION

PROCESS FORMS STANDARD OIL OF OHIO IN 1870

MORE ON ROCKEFELLER… FORCES RAILROADS TO GIVE HIM

REBATES. ON HIS SHIPMENTS ALSO ON HIS COMPETITORS

SHIPMENTS. BY 1879 STANDARD OIL CONTROL

90 % OF REFINING CAPACITY.

COMPARES STANDARD OIL TO A ROSE BOTH REQUIRE EARLY SACRIFICE SLOGAN: “LET US PREY!”

TRUSTS AND MONOPOLIES INTERLOCKING DIRECTORATES HOLDING COMPANIES CONSUMERS AND WORKERS ARE

HARMED BY MONOPOLIES.