Chapter 24
Industry Comes of Age (The Gilded Age Part II)
The Railroad
• Built with government subsidies
and land grants
• Frontier outposts became
flourishing cities (if they were
lucky)
• 1869: The Transcontinental
Railroad links east and west
– The “golden spike” is hammered in at
Promontory Point, Utah
• Steel provided the rails and bridges
• Airbrakes made travel safer
Revolutionary Railroads
• Physical unification of our country
• The nation’s first “big business”
– 20% of US investment $
– More employees than any other
– Who wants to be a millionaire??
• Raw materials
factories
Finished goods
consumers
• Farm products from the West
population centers in the East
• Railroads changed time itself!
Golden versus Gilded
• Stock watering inflated the RRs
values artificially
• Bribes/Kickbacks to politicians and
judges
• Rates were not made public
• The reality: RR owners controlled
American life
– Politically, socially and economically ($)
– Especially true of the farmers who were
treated unfairly
– Remember…this is where we saw the
rise of Populism
Cleaning Up This
Gilded Age
• Wabash v. Illinois (1886) ruled that
it was the federal government’s job
to regulate interstate commerce
– Illinois was trying to regulate railroad
rates within their state
• The I.C.C. (1887) set the precedent
that the government was
bound to protect the
public interest
– Our nation’s first true
regulatory agency
Mechanization and
Innovation
• Investment + abundant nat. res. +
the size of the American market +
transportation networks + cheap,
plentiful labor + innovators and
inventors (the Rockefellers, the
Carnegies, the Edisons and the
Bells) = SUCCESS!
• By 1894, the US was the world’s
manufacturing leader
In Trusts We DON’T
Trust
• Large business combinations
(trusts) make millions while
reducing competition
– w/ the Pendleton Act taking the
incentive out of political
contributions, politicians turn to
big business
• Horizontal Integration
– J.D. Rockefeller & Standard Oil
– A monopoly
• Vertical Integration
– A. Carnegie & Carnegie Steel
– NOT a monopoly
• Horizontal Integration occurs
when a business expands its
control over other similar or
closely related businesses.
– By 1890, Standard Oil controlled
over 90% of the refined oil in the
U.S.
• Vertical Integration occurs
when a business expands its
control over other business that
are part of its overall
manufacturing process.
What did he do??
• Temporarily undercutting the prices of
competitors until they either went out of
business or sold out to Standard Oil.
• Buying up the components needed to make
oil barrels in order to prevent competitors
from getting their oil to customers
• Using secret rebates from the RR to reduce
shipping costs to a level far below the rates
charged to competitors.
• Secretly buying up competitors and then
having officials from those companies spy on
and give advance warning of deals being
planned by other competitors.
…or a “Captain of
Industry?”
• John D.
Rockefeller:
"The American
Beauty rose can
be produced in
all its splendor
only by
sacrificing the
early buds that
grow up around
it."
Gilded Age Philosophies
• Herbert Spencer and others were
often labeled as “social
Darwinists”
– Individuals “won” their station in
life based on competition and their
natural talents (Darwin…Get it?)
– This could also be applied to entire
nations in order to justify
dominating “lesser peoples”
• Self-justification of one’s wealth
led to contempt for the poor
Gilded Age Philosophies
• Some Gilded Age capitalists did
believe they had a duty to give back to
the society that gave them their $
• This was known as the “Gospel of
Wealth”
– Andrew Carnegie famously said, “He
who dies rich, dies disgraced”
– By his death in 1919, he had given away
over $350 million and provided more
than 2,500 free public libraries
throughout the world (J.D.R. will give
away $500 million)
The Drumbeat of
Discontent
• An epidemic of strikes
raised the prospects of
an industrial workers
and farmer alliance with
the Populists
• Haymarket Square (1886)
– 7 police killed and 60 wounded
when a pipe bomb explodes
• Homestead (1892)
– 10 people were killed, 60 wounded
when violence between Pinkertons and
striking workers broke out in Pittsburgh
Sherman Anti-Trust Act
(1890)
• The first
federal antitrust law
• Authorized
federal action
against any
“combination
in restraint of
trade”
…and in the South??
• James B. Duke revitalizes the
tobacco industry w/ machinerolled cigarettes
• North vs. South (Really? Again?)
– N. manufactured goods were given
preferential treatment by the RR
– RR encouraged the use of S. raw
materials
– “Pittsburgh Pricing” to keep S. steel
from heading N.
• Keeping labor cheap kept S.
workers in poverty
The Worsening
Condition of Labor
• Frederick Taylor published the
Principles of Scientific
Management
– Unskilled workers become “part
of the machine”
• The skilled worker could be
replaced
– The craftsmen of old no longer
controls his destiny
•
•
•
•
• Working
conditions
proved less
than ideal
Small, crowded rooms
Specialization led to boredom,
monotony and injury
Stale air and unsafe machinery
Long hours, low wages, no job
security
Labor Unions
•
•
•
•
Knights of Labor
1st national union
Skilled & unskilled
T. Powderly
becomes the leader
in 1879 and ends
the secrecy of the
organization
• American
Federation of
Labor
• Organization of
individual unions
into one
• Only skilled
• Collective
bargaining
• Samuel Gompers
was their most
significant leader
The Impact of the
Industrial Revolution
• “Jeffersonian ideals were
withering…”
• Rural Americans and
European immigrants were
headed for the factories
• A new “ideal woman” (the Gibson
Girl) enters the workplace for
secretarial/clerical work
• Gap between the rich & poor grows
• Dependent workers
• Clamor for international trade
Chapter 25
America Moves to the City
The Urban Frontier
• Characteristics of cities at the turn of
the century
• How cities were “monuments of
contradictions”
The New Immigrants
• Where from?
• Social/Economic
characteristics
• Pushes and Pulls
• How they were
welcomed (or not)
• How obstacles were
overcome
Women, Blacks and Whites
• Meanwhile, the
NAWSA fought
for suffrage for
women…but
only white
women
• Ida B. Wells helps launch
the National Assoc. of
Colored Women fighting
for equality as well as
anti-lynching laws
• Booker T. Washington took
an “accomodationist”
approach
• Go to technical school (like
Tuskegee Institute) and
learn a trade
• In 1895 at the Atlanta
Exposition he said:
• W.E.B. DuBois spoke of
the “Talented Tenth” in
1903
– “Negroes must first of all
deal with the Talented
Tenth; it is the problem of
developing the best of this
race that they may guide
the mass away from the
contamination and death of
the worst”
– “In all things purely social we
can be as separate as the
fingers, yet one as the hand in • Go to college. Lead.
all things essential to mutual
• Considered the “Atlanta
progress” (remember Plessy v.
Compromise” propaganda
Ferguson?)
Divergent Paths to
Equality for AfricanAmericans
1818
Frederick Douglass
1895
1856 Booker T. Washington1915
1868
W.E.B DuBois
1963
1925
Malcolm X
1929
1965
M.L.K.
1968