Industry and Railroads
The Main Idea
During the late 1800s, new technology led
to rapid industrial growth and the
expansion of railroads.
• What new industries emerged in the late
1800s, and why were they important?
• Why did railroads expand, and what
changes resulted?
New Industries Emerge
• New technologies
– Electrical power replaced steam and water
power.
– Larger factories produced more and more
goods.
– Faster transportation moved people and goods
more cheaply.
• Dramatic industrial growth
– Period sometimes called the Second Industrial
Revolution
New Industries Emerge
Making steel
• The Bessemer process of purifying steel helped to make America the world’s top
producer and transformed the U.S. into a modern industrial economy.
• Construction companies could build bigger bridges and taller buildings.
• The low cost of steel made ordinary items affordable.
Oil industry begins
• Oil was a key commodity as a fuel source and for lubrication.
• Edwin L. Drake drilled the first commercial oil well. Oil prospectors, or
Wildcatters, looked for oil in other regions.
• Major sources of energy from oil fueled a revolution in transportation and industry.
Railroads expand
•
Between 1865 and 1890, the number of miles of railroad track increased nearly fivefold.
Aiding the growth, the federal government gave thousands of acres of land to railroad
companies.
Transcontinental Railroad
Union Pacific
•
Laid tracks westward from Omaha, Nebraska
•
Prairie lands and gently rolling hills made for quick progress.
Central Pacific
•
Tracks were laid eastward from Sacramento, California. Chinese workers laid tracks
through tougher terrain, crossing deserts and blasting through mountains.
•
Uniting the country physically and economically, the two rail lines met on May 18, 1869
in Promontory Point Utah.
Important Effects
Creation of rail network promoted trade and provided jobs. Demand
for rails and railcars boosted steel industry and train
manufacturers.
Settlement of the West was easier, and sparsely populated areas
began to fill with residents. With railroads, new towns were
founded and existing ones expanded.
Railroads led to the adoption of standard time. Before, each area
had its own local time based on the position of the sun. Accurate
timekeeping was needed for the trains to keep to their schedule.
C. F. Dowd proposed dividing the earth into time zones, setting
the clocks alike in each zone. Railroad officials used this idea in
1883, and by 1918 standard time was adopted for the nation as
a whole.
The Rise of Big Business
The Main Idea
Corporations run by powerful business leaders became a dominant
force in the American economy.
• What conditions created a favorable climate for business during the late
1800s?
• How did business structures change?
• Who were the leading industrial tycoons, and what did they achieve?
• How did mass marketing change the way goods were sold?
A Favorable Climate for Business
The American ideal was one of self-reliant individualism. A strong
work ethic made one successful, and entrepreneurs risked their
money and talents in new ventures.
Free markets
• With capitalism, competition determines prices and wages, and most industries are
run by private businesses.
• In the 1800s, business leaders believed in laissez-faire capitalism with no
government intervention.
• They believed government regulation would destroy self-reliance, reduce profits,
and harm the economy.
Social Darwinism
• Many thinkers believed that inequalities were part of the natural order.
• Charles Darwin believed that members of a species complete for survival in a
natural selection process.
• Applied to society, stronger people, businesses, and nations would prosper, and
weaker ones would fail in a “survival of the fittest.”
Business Structures Change
• Proprietorships and partnerships
– Small businesses were run by individual proprietors or had more
than one owner in a partnership. In either case, owners are
personally responsible for all business debts and obligations.
• Corporations
– As industries grew, the structure of ownership changed. Businesses
were owned by stockholders; decisions made by a board of
directors, with day-to-day operations run by corporate officers.
Investment money was raised by selling stock, and investors were
bound only by the amount of their investment.
• Trusts and Monopolies
– Some companies merged and turned their stocks over to a board of
trustees who ran the group of companies as a single entity.
Sometimes a trust gained a monopoly, having complete control of
an industry. With no competition, prices could be raised or lowered
at will.
Industrial Tycoons
Rockefeller and oil
Starting with an oil refinery and superb business sense, John D.
Rockefeller used both vertical and horizontal integration to capture
90 percent of the U.S. oil refinery business by 1879.
Rockefeller gave away over half of his fortune to charity. He donated
millions to education and good works through his Rockefeller
Foundation.
Carnegie and steel
Andrew Carnegie rose from immigrant child to steel magnate. He used
profits from various business investments to found his own company.
By the end of the century the Carnegie Steel Company dominated the
U.S. steel industry.
After retiring, Carnegie devoted his time to charity, supporting
education and building public libraries
Industrial Tycoons
Cornelius Vanderbilt
Vanderbilt began investing in railroads during the Civil War. By 1872,
he owned the New York Central Railroad. At the height of his career
he controlled 4,500 miles of track.
He supported few charities, but gave money to what would come to be
Vanderbilt University. He died leaving an estate of $100 million.
George Pullman
George Pullman made his fortune designing and building sleeper cars
that made long-distance travel more comfortable. He built a town
south of Chicago to house workers in relative comfort, believing
happy workers were more productive.
The Pullman Company controlled aspects of life in the town, and
criticism was not tolerated.
A Mixed Legacy
Critics
– Business tycoons were “robber barons” who profited
unfairly by squeezing out competitors. They lived lavish
lifestyles from their ill-gotten rewards.
Proponents
– Business tycoons were “captains of industry” who used
their business skills to make the American economy more
productive. That in turn made the American economy
stronger.
Mass Marketing
• Retailers looked for new ways to maximize their profits.
• Household goods were targeted toward women, who made most of
those purchasing decisions. Wholesome images were used to
convey a sense of purity. Brand names helped customers
remember products. The convenient department store emerged,
providing a variety of goods. The stores bought in bulk, passing
the savings on to the customers.
• Mail-order companies gave rural dwellers access to a huge variety
of goods. The Sears, Roebuck and Company catalog was 507
pages. Customers made their selections, sent in the payments,
and waited for the merchandise to arrive.
Workers Organize
The Main Idea
Grim working conditions in many industries led workers to form
unions and stage labor strikes.
• What was the relationship between government and business in the late
1800s?
• What were working conditions like for industrial workers?
• How did workers seek change?
Government and Business
• Hands-off policy
– Government did not interfere with business in the late 1800s, but
as corporations expanded and gained power, that policy began to
change.
• Controlling the giants
– The Sherman Antitrust Act was passed in 1890, making it illegal
to form trusts that interfered with free trade. It prohibited
monopolies and activities hindering competition.
– The law was vague, however, and it was seldom enforced.
• Workers
– The government paid less attention to workers, who scraped by on
small wages. By 1890, 10 percent of the population controlled 75
percent of the nation’s wealth. The rich were very rich, and many
industrial workers made less than $500 per year.
Industrial Workers
The workforce
• Many factory workers were immigrants or rural Americans moving to
the cities for jobs.
• The best jobs went to native-born whites or European immigrants.
• Less well-paying jobs were open to African Americans, as household
help or laborers.
• By 1900, one in six children between the ages of 10 and 15 held
factory jobs.
Working conditions
• Most unskilled laborers worked 10-hour days, six days a week.
• They had no paid vacation and no sick leave.
• Speed of production led to terrible accidents. Injured workers were
replaced.
• Sweatshops were common. These cramped workshops set up in
shabby tenement buildings were common in the garment industry.
Workers Seek Change
Early organizing
• In 1794, Philadelphia shoemakers formed a trade union. Over
decades, unions formed for skilled trade workers, but they remained
small and local.
Nation Unions
• After the Civil War, things changed. The Knights of Labor formed in
1869. Under the leadership of Terence V. Powderly in the 1880s, they
began to accept unskilled workers, women, and African Americans as
members. They campaigned for reforms, such as eight-hour workdays
and the end of child labor through boycotts and negotiations.
• The Great Railroad Strike
• After wage cuts, the first railroad strike occurred in 1877. Initial
strikes quickly spread, and state militias were called out. Violence
ensued, lives were lost, and costly damage was done. The arrival of
U.S. Army troops put an end to the strike.
Strikes and Turmoil
The Haymarket Riot
•
1886 was a difficult year for labor.
•
One of the worst clashes was at Haymarket Square in Chicago. A bomb was thrown in a
crowd gathered to protest violent police action. Gunshots rang out, and eleven people were
killed and hundreds injured before it was over.
•
Foreign-born unionists were blamed for the violence, and the press fanned xenophobia.
•
Eight men were charged with conspiracy, but no evidence connected them to the crime.
•
All eight were convicted and sentenced to death. After four hangings and one suicide, the last
three were pardoned.
The American Federation of Labor
•
Employers struck back at organized labor, forcing employees to sign documents saying they
would not join a union.
•
Blacklists of people deemed troublemakers were made and shared by employers, who refused
to hire anyone listed.
•
Striking workers were replaced with “scabs,” or strikebreakers.
•
Samuel Gompers led a group of skilled workers to form the American Federation of Labor in
1886.
•
Using strikes and other tactics, the AFL did win wage increases and shorter workweeks.
• The Homestead Strike
• Unions made some gains, but conflicts continued. Carnegie Steel
workers in Homestead, Pennsylvania, refused to work faster, and the
manager tried to lock them out. The workers seized the plant. Gunfire
erupted when private guards hired by the company tried to take
control. After a 14-hour battle and fourteen deaths, the governor called
out the state militia. The steelworkers’ union withered within months.
• The Pullman Strike
• After laying off a third of its employees in 1893, the Pullman
Company cut the wages of remaining workers by 25 percent without
lowering their rents. Workers went on strike with the support of
Eugene V. Debs, the leader of the American Railway Union. The
government ordered the strike be called off, but the union refused.
President Grover Cleveland called in federal troops, and the strike
collapsed. The late 1800s would remain an era of big business.
The Age of Invention
The Main Idea
Important innovations in transportation and communication occurred
during the Second Industrial Revolution.
• What advances in transportation were made in the late 1800s?
• What inventions led to a communications revolution?
• How did Thomas Edison help shape the modern world?
Advances in Transportation
• Streetcars were horse-drawn vehicles placed on rails on the
street to make the ride smoother. Streetcars needed more
power than horses could provide, and cable cars were
invented in San Francisco to get cars up the steep hills there.
The cars latched on to a moving cable underground.
• Subways developed as a result of increased traffic from
horses and electric streetcars competing for space. Boston
built the first subway line in 1897, with New York City
following in 1904.
Advances in Transportation
• Automobiles—inventors were experimenting with vehicles
for personal use as well. A breakthrough came with the
invention of the internal combustion engine in 1867. The
first practical motorcar in the U.S. was built in 1893.
Automobiles were only for the wealthy; a new car cost
about $2,500.
• Airplanes—Ohio bicycle makers Wilbur and Orville
Wright were the first to successfully fly an airplane–for 12
seconds in 1903. They followed this success with even
longer flights.
Communications Revolution
The telegraph
• Samuel F. B. Morse patented his method of communicating by sending messages
over wires with electricity, calling it the telegraph.
• Operators tapped out patterns of long and short messages that stood for letters of the
alphabet. The system was known as Morse code.
• After the Civil War, the telegraph grew with the railroads. Telegraph wires were
strung along the tracks, and train stations had telegraph offices in them.
The telephone
• Two men were working on devices that could transmit voices using electricity.
• Alexander Graham Bell patented his device hours before his competitor, and he
gets the credit for the invention of the telephone in 1876.
• Companies found the telephone to be an essential business tool. People wanted to
have them in their homes as well.
• By 1900, more than a million telephones had been installed across the nation.
The Typewriter
Inventors in many nations made attempts to create a writing
machine.
• Christopher Latham Sholes, a Milwaukee printer, developed the
first practical typewriter in 1867. He later improved upon his
machine by designing the QWERTY keyboard, still the standard on
keyboards today. The most frequently used letters were placed far
apart so they would not jam when they were struck.
The typewriter could produce legible documents very quickly.
Businesses began to hire women as typists to manage company
correspondence, opening up new job opportunities for women.
Thomas Edison
• Obsessed with progress
– As a child, Thomas Edison was curious about everything. Nearly deaf by
twelve, he declared himself an inventor by age twenty-two. In 1886, he opened
his own research laboratory in Menlo Park, N.J.
• Hard work
– Edison said, “Genius is 1 percent inspiration, 99 percent perspiration.” He
worked alongside his assistants and spent long hours tinkering with designs.
Inventions poured out of the lab, and Edison became known as the Wizard of
Menlo Park.
• Electric lighting
– Edison developed the practical electric lighting. With the incandescent bulb
came the need for widely available electricity. Edison would bring electricity to
New York City, designing and producing all of the parts necessary for an
electricity network. Electric power plants spread across the country.
– Over his lifetime, Edison earned over 1,000 U.S. patents.