Second Industrial
Revolution
Industry and Railroads
• Bessemer process is created in the
1850s
• By 1910 the U.S. becomes the world’s
top steel producer
• Railroads, bridges, and buildings –
expansion of American infrastructure
• Factories could produce more goods
• The low cost of steel also made
everday items such as nails and wire
Brooklyn Bridge
Home Insurance Building
in Chicago
• Between 1865-1890 the number of miles
of railroad track jumped fivefold
• Prompted the federal government to give
railroads land grants
• Pacific Railway Act (1862): Central Pacific
and Union Pacific
• Increased settlement of the West
• Created Standard Time and time zones
(1918)
The Rise of Big Business
• Entrepreneurs – risk takers
• Capitalism – free enterprise where
most businesses are privately owned
• Laissez-faire capitalism – ‘leave alone’
• Social Darwinism – huge inequalities
exist, but do so because of competition
for survival. Stronger members adapt
while weaker ones die out (natural
selection). Businesses will succeed and
many will fail (people as well).
• The corporation developed – business
with the legal status of an individual.
They are owned by people who own
stock, or shares
• Advantages
– Corp. can raise money by selling stock
– Stockholders lose what they invest
– Corp. can last after founders move on
• Many competing corporations form a
trust
– In many cases it led to monopolies
• http://www.nytimes.com/ref/
business/20070715_GILDED_
GRAPHIC.html#
• John D. Rockefeller
– Standard Oil; vertical integration; horizontal
integration
– Eventually controls 90% of America’s oil
supply
• Andrew Carnegie
– Immigrant; worked for Pennsylvania
Railroad; bought his own; Carnegie Steel
Company; philanthropist
• Cornelius Vanderbilt
– Railroads and steamships
• George Pullman
– Designing and building sleeper cars
Pullman Company Town
•Robber Barons
(or)
•Captains of
Industry?
• Advertising marketed to specific
groups
• Department stores make
shopping easier
• Rural communities ordered
from catalogues
Workers Unite
• Many industrial workers make no
more than $500 a year
• In 1890 10% of the population
owns 75% of the wealth
• Congress passes the Sherman
Antitrust Act in 1890 – can’t form
trusts that interfere with free trade
(few cases were prosecuted)
• Many factory workers were
immigrants, rural transplants, African
Americans, children
• By 1900 1 in 6 kids 10-15 held a job
outside the home
• 12-16 hrs. a day, 6 days a week in the
factory
• No paid vacation, no sick leave, no
workmen’s comp.
• Beginnings of organization
– Knights of Labor (1869) accepted
unskilled labor
• Goals of the Knights of Labor
– 8 hr. workday
– End of child labor
– Equal pay for equal work
– They engaged in boycotts, negotiation,
and then strikes
• Great Railroad Strike (1877) –
• The Haymarket Riot (1886) –