Bell Ringer
• Define the following terms
• Laissez-faire
• Tenement
• Free enterprise
• Nativism
• Ethnic City
CH 9
INDUSTRIALIZATION
1865-1901
The Rise of Industry
Railroads
Unions
CH 9.1
The Rise of Industry
• Pre-Civil War: Industrial Revolution Begins
• Post-Civil War U.S. switches from Rural to Urban society
(leave farms for mines and factories)
• By 1900 GNP 8x larger than it was at the end of the Civil War
(1865)
CH 9.1
The Rise of Industry
Natural
Resources
Free
Enterprise
System
Industrial
Nation
Inventions &
Technology
Large workforce
RISE OF BIG BUSINESS
Causes of Rapid industrialization
Steam Revolution of the 1830s-1850s.
2. The Railroad fueled the growing US economy:
 First big business in the US.
 A magnet for financial investment.
 The key to opening the West.
 Aided the development of other industries.
1.
Causes of Industrialization
3. Technological innovations.
 Bessemer and open hearth process
 Refrigerated cars
 Edison
o “Wizard of Menlo Park”
o light bulb, phonograph, motion pictures.
Causes of Industrialization
4.Unskilled & semi-skilled
labor in abundance.
5.Abundant capital.
6.New, talented group of businessmen [entrepreneurs]
and advisors.
7.Market growing as US population increased.
8.Government willing to help at all levels to stimulate
economic growth.
9.Abundant natural resources.
Causes of Industrialization
The Supreme Court
Santa Clara
County v. Southern
Pacific Railroad
• Applied the 14th
Amendment to
Corporations giving
them many of the
protections
previously only given
to “natural
persons.”
Corporations are people????
• A corporation:
• Is owned by many
people (stockholders)
• But treated as a single
entity
• It can
• Own property
• Pay taxes
• Sue or be sued
• Make contracts
New Business Culture
1. Laissez Faire  the ideology of the
Industrial Age.
 Individual as a moral and economic
ideal.
 Individuals should compete freely in
the marketplace.
 The market was not man-made or
invented.
 No room for government in the
market!
2. Social Darwinism
× British economist.
× Advocate of
laissez-faire.
× Adapted Darwin’s
ideas from the
“Origin of Species”
to humans.
× Notion of “Survival
of the Fittest.”
Herbert Spencer
2. Social Darwinism in
America
$ Individuals must
have absolute
freedom to
struggle, succeed or
fail.
William Graham Sumner
Folkways (1906)
$ Therefore, state
intervention to
reward society and
the economy is
futile!
Opposing View Points
• Captains of Industry
• Created Jobs
• Increased production
• Provided cheap products
• Gave money back to the
community
• Helped build the nation
• Robber Barons
• Exploited workers
• Corrupted the government
• Greedy
• Offered bribes for political
favors
• Above the law
Captains of Industry
• Andrew Carnegie- US Steel
• J. P. Morgan- Banking, and
Insurance Companies
• John Rockefeller – Standard Oil
• Cornelius Vanderbilt- Rail Roads
Captains of Industry
I helped make
life easier for
you
I created
jobs
We make
all those
nice things
you like!
If you work
hard you
can be rich
too!
We made
this country
an empire
I provide
affordable
products
Robber Barons
You work for
pennies while I
make millions
I gamble
with the
taxpayers
money
I get
governme
nt
bailouts…
We started
corporations
The people
you vote for
work for me
Corporations
are people
and have
rights--right?
America’s Richest Citizens
1. John Rockefeller OIL
$195.6 Billion
2nd Andrew Carnegie
STEEL
$100.5 Billion
3rd Cornelius Vanderbilt
Railroads
$95.9 Billion
4th John Jacob Astor
• Real Estate
• $78 Billion
Then the Rest
5. Bill Gates: $70Billion
6. Stephen Girard:
Shipping $55 billion
7. A.T. Stewart: CRAP,
$46 Billion
8. Weyerhaeuser:
Lumber, $43 Billion
9. Jay Gould: RR’s $42
Billion
10. Marshall Field:
Department Stores
$40 Billion
11. Sam Walton: Retail,
$37 Billion
12. Andrew Mellon:
Banking, $32 Billion
#23 is J.P. Morgan “The
richest Man in
America at $25
Billion
Justifications for Industrialists’ Extreme
Wealth
• Social Darwinism
• Herbert Spencer
• Based on Charles Darwin’s
theory of evolution
• Those who are rich are more
fit, than those who are poor
• Attempted to use science to
explain social classes
• Gospel of Wealth
• Andrew Carnegie
• God gave wealth to the most
capable people
• It is the duty of the wealthy to give
money to help the poor
• Carnegie gave millions of dollars
away to establish libraries,
colleges, and museums
New Type of Business Entities
The Reorganization of Work
Frederick W. Taylor
The Principles of Scientific Management (1911)
The Reorganization of Work
The Assembly Line
% of Billionaires in 1900
% of Billionaires in 1918
Corporations
• Stocks
• Shares of a corporations
• Share risk and reward
• Stockholder
• People who own a corporations via
stocks
• Buying/Selling STOCKS allows
corporations to expand/increase
• Production
• Employees
• Factory
• Research & Development
Corporations
• More money brings
• New technologies
• More workers
• New machines
• Bigger factories
• Economies of Scale
• Corporation can make
more goods at a lower
cost….passing the
saving on to you 
POOLS
• An affiliation of two or
more
people/companies
formed for the purpose
of attempting to
manipulate a products
price and/or volume.
• = gas station
$
$
$
$
$
Monopoly
• Exclusive control of a
product or service in a
particular market that
makes it possible to
manipulate prices.
Vertical Integration
• Corporation owns all of
the companies which it
depends on to improve
profits. Cut out the
profit margins of
“middle man”
companies.
• Ex. McDonalds
Horizontal Integration
• Combining or
merging LIKE
companies into one
LARGE company.
• Ex…Blockbuster
Video
TRUSTS
BIG OIL
• an organization of
businesses
designed to operate
like a monopoly to
circumvent antimonopoly laws
Trustee 1
Joe’s Oil
Trustee 2
Bill’s Oil
Trustee 3
Juan’s Oil
Holding Companies
• Corporation that
doesn’t really do
anything except own a
significant amount of
stock in real
companies.
• Board of Directors
• CEOs
Cutting Costs
$10 a
day
• Skilled Workers replaced
by Unskilled machine
operators.
• Production cost lower
• Deflation = profits
• Value of $ rises
• Prices drop
• Workers wage has more buying
power
• Terrible working conditions
• Unsafe
• Unsanitary
• Long hours
• Low wages
$3 a day
Workers Unite
• TRADE UNIONS- Limited
to Skilled Laborers
• Iron workers
• Shoemakers
• Industrial UnionsCommon Laborers and craft
Workers
• Carpenters
• Painters
• artisans
Workers Organize
Goal #1:
Shorter work day
Strikes
Goal #2:
End child labor
boycotts
Goal #4:
Worker owned
factories
Knights of Labor – formed
in 1869 as the first labor
union in the nation.
arbitration
Goal #3:
Equal pay for men
and women
STRIKES
• Workers walk off the
job & protest working
conditions
• Early Strikes resulted
in Violent Riots
• Government normally
sided with Business
because they shared
similar interest in
companies making a
profit
• Pullman Strikes
• Great Rail Road Strike
• Haymarket Riots
• American Federation of
Labor (AFL)
•umbrella organization made up of many
different trade unions.
•Led by Samuel Gompers
•Unions stay out of Politics
•Closed Shops- Companies only hire Union
Workers
Unions of the
AFL - CIO
A
F
L
United Farm
Workers of
America
Screen
Actors
Guild
United Steel
Workers of
America
American Postal
Workers Union
American
Federation
of Teachers
International
Association of
Firefighters
Immigration
• Push Factor
Reason(s) to leave ones
birth country to live in a
foreign country
Get
out
• Pull factors
• Reason(s) a foreign
country inspires people
from their home country
Come
here
Steerage
• Why travel in these
conditions?
• Difficult & Expensive to get
to US
• What was the journey like
• Travel was basic, cheap,
crowded, miserable
• Filthy cramped living
conditions.
• Trip took 7 to 21 days
• RATS-LICE-DiseaseDeath
Ellis Island
• Processing center for immigrants New York harbor
• Frantic pace, Lost Identities, Health Inspections
How the Political Machine Worked
Political
Machine
supplies jobs,
food, clothes,
housing
Party boss
wins election
so he can
continue his
corrupt politics
Votes for the
party boss to
remain in
power
Urban Politics
• Cities grow faster than government
• Political Machine
– Informal political group
– Gain & keep power
– Got things for the working class.
• Jobs, homes, food, clothes, heat, protection, etc…
– Positive note
• Provided necessary services & helped assimilate the new city
dwellers.
• Party Boss received votes for Providing “things”
– Once elected used political power for greed.
• Grafts=getting money through dishonest or questionable
means.
• Bribes
Tammany Hall
William “Boss” Tweed
• Tweed Courthouse
• One of the most corrupt
politicians in history
• Grossly overpaid contractors for
work
• 13 million.
• 180,000(2.5mil) for 3 tables & 40
chairs.
• Imprisoned for corruption. Died.
• Thomas Nast Political
cartoons exposed corruption
Urbanization: Ethnic Cities
Positives
• Lived with similar
people who shared
• Language
• Customs
• Culture
• Sense of Security
• Sense of Belonging
Negatives
• Slow to assimilate to
America culture
• Segregation led to
violence
• Irish vs. Italians
• Polish vs. Russians
• Slow to learn ENGLISH
• Cant communicate
• Hard to find
• a job
• Basic needs
Urbanization
• Immigrants Lacked
• Money
• Cant buy land or
farms
• Education
• Forced to stay in
cities.
• Long Hours
• Little Pay
• Poor Working conditions
Immigration
Old Immigrants N
& W Europe
Asians
European
Latin America
E. & S. European
New
Immigrant
s
S&E
Nativist- English/Protestant descent
We were here
first…Protect
the American
Worker
• Extreme dislike of
foreigners
• Focused on
• Jews
• Catholics
• E. Europeans
• Asians
• Immigrants
• Worked for less money
• Were easily replaceable
• Had Communist & Anarchist
ideas
MARXIST
• Communism -
--> classless
society
• People
control
everything
• Inspires
Revolution
ANARCHISTS
Immigrants = revolution,
communism,Anarchy
• Anarchist
• No government
• Inspires
Revolution
Nativism
• Labor Unions anti-immigration
• Anti-Immigration Org
• American Protective Association
• Workingman’s Party of California
• Chinese Exclusion Acts
• Banned for 10 years
• Chinese in US could not become
citizens
Urban American Social Issues
• Immigration
• Urbanization
• Gilded Age
• Social Darwinism
• Early Reform
Gilded Age
• Coined by Mark Twain
• Gilded = Covered in Gold
• New Inventions
• Skyscrapers
• Electricity
• Great wealth
• Covered
• Poverty
• Crime
• Corruption
• Gap between rich and poor
GILDED
AGE
Urban Problems
• 4 Major Problems:
• Overcrowding
• Crime/Violence
• Sanitation
• Political Corruption
Urbanization
• Cities
• Overcrowding
• Plumbing
• Running water
• Electricity
• Cultural Centers
• Museums
• Libraries
• Theaters
Ethnic Cities
PROS
• Familiar language, food,
customs, culture…
• Its like living in Italy all
over again
• CONS
• Slow to learn English
• Hard to find a job
• Racism
• Crime & violence towards
other ethnic groups
Class Division
• Gap between rich and
poor grows larger & faster
during the gilded age
• Rich make money & profits
in business
• Rising number of poor
continue to drive wages
down