Factors that created a
technological boom in
the US:
1. Natural Resources
2. New Inventions
3. Government support
for business
4. Growing Urban
population
By the 1920’s the US will be
the leading industrial
power


The Bessemer
Process – Invented
by Henry Bessemer
and William Kelly
(1856)
› Transferred iron into
steel by removing
carbon
› Produced a light,
flexible, rust-resistant
metal.

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Railroads open the
west
Machines were more
durable
Taller buildings
conserved space
Less vulnerable to fire
than wooden
structures
› Chicago Fire of 1871-
City burned for 2 days
and left 90,000
homeless
They were the largest consumers of steel
 The spread of railroads led to:

1. Growth of Towns
2. New Markets
3. Greater Opportunities for Wealth

Professor C.F. Dowd–
proposed dividing
the earth into time
zones (1869)
› Divided the earth
into 24 time zones for
every hour of the
day.
› Unified the Nation
under time.


Misuse of government
land grants
Rates showed
discrimination –
Charged different
customers different
rates
› Charged farmers
higher rates to keep
them in debt
› Charged more for
shorter routes if there
were no alternate
carriers available
Supported by Grange members (Populists)
 Established maximum freight and passenger
rates and prohibited discrimination
 The Supreme Court upheld the Granger
Laws in Munn v. Illinois

› Government could regulate railroads for the
public good – meaning that the government
can now regulate private industry to serve the
public good.

During this time, businessmen created large
business organizations known as trusts
› The ingenuity of these entrepreneurs earned them the
nickname of Captains of Industry
› Yet their ruthlessness in building wealth at the expense
of their competitors, workers, and consumers often
earned them the title of Robber Barons
Herbert Spencer used Darwin’s natural
selection theory and applied it to human
society. The “fittest” were intelligent and
strong both physically and emotionally.
Those who were not would drop out of
society.

William Sumner applied this idea to
business. Competition drives out those
that shouldn’t be in business. This justified
shrewd investments and unscrupulous
business practices. It was viewed as the
way things worked.
Business
Society


Born to a low income family
but worked his way up to
becoming the owner of the
Standard Oil Company (today
Exxon)
› Most profitable company and
made him the richest man in
the world (but paid workers
very little)

Sold his oil at lower prices than
it cost to produce it
› Raised prices once he put his
competitors out of business.

Monopoly – complete control
of the market and price of a
product
› Control over the industries
production, wage, and prices.

Established Trusts to
reduce competition
outside of Cleveland.
(location of Standard Oil)
› Trust is a business
arrangement under
which a number of
companies unite into one
system.

By 1882 Rockefeller
controlled more than 90%
of the oil companies in
the US.

Owner of Carnegie Steel
Company – produced 20%
of the nations steel
› Carnegie made 25 million
in one year personally
Introduced new
techniques and machinery
to make better products
for less money
 Encouraged competition
among his workers to
increase production and
cut costs

Bought out his suppliers
(Vertical Integration)
and competitors
(Horizontal Integration)
to create a monopoly
 Offered company stock
to employees
 Carnegie gave 90% of
his wealth to charity:
Carnegie Hall, Carnegie
Foundation, various
universities , and 3,000
libraries.

One of the most powerful
bankers of his era, J.P.
Morgan (1837-1913)
financed railroads and
helped organize U.S. Steel,
General Electric and other
major corporations.
 Morgan used his influence
to help stabilize American
financial markets during
several economic crises.
However, he faced criticism
that he had too much
power and was accused of
manipulating the nation’s
financial system for his own
gain.




12+ hour workdays, 6
days a week for very low
wages.
No vacations or sick
leave, unemployment,
or workers
compensation
Factories were dirty,
poorly ventilated, poorly
lit, and dangerous
› In 1882 an average of
675 workers were killed
in labor related
accidents each week!

Typical pay for a
factory worker:
› Men - $2 per day
› Women - $1 per day
› Children - $0.27 per
day

These conditions led to
the rise of labor unions
1886 Chicago – 1,200
gathered together to
protest the killing of a striker
by police the previous day
at the McCormick Reapers
factory.
 Police fired into the crowd
when a bomb was thrown
at them.
 Public opinion began
turning against the labor
movement because it was
seen as encouraging
violence.




Located in Homestead, Pennsylvania, pitted Carnegie Steel
Company against the nation’s strongest trade union, the
Amalgamated Association of Iron and Steel Workers.
His plant manager, Henry Clay Frick, stepped up production
demands, and when the union refused to accept the new
conditions, Frick began locking the workers out of the plant.
A strike was formed and Frick calls in guards. When they
arrived they were faced with 10,000 strikers, many of whom
were armed.
› The Battle began.
After an all day battle the guards surrendered
 The sheriff then called in 8,000 militia. Under their
protection, strikebreakers were able to get the plant
running again.
 The corporation had more than a hundred strikers
arrested, most were finally released, each case
consumed much of the union’s time, money, and
energy. The strike lost momentum and
ended on November 20, 1892.
 With the Amalgamated
Association virtually
destroyed, Carnegie Steel
moved quickly to institute
longer hours and lower
wages.

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

America was experiencing
an economic depression
that started in 1893.
Because of this depression,
Pullman laid off some
workers, lowered workers
wages, but kept rent the
same.
Workers protested these
wage cuts and shut down
production – violent strike
Strike ended after federal
troops were called in.
Organized by Union
advocate Eugene Debs
› Became the leading
Socialist figure in America


March 1911 – a fire
broke out at the
Triangle Shirtwaist
Factory in New York
City
Female workers were
trapped inside with the
exit doors locked
› Locked to prevent
workers from stealing
materials or taking
breaks

146 women died in the
fire


50 of the dead were
killed jumping from the
windows into the street
Public outrage led New
York to pass new
restrictions:
› Strict fire codes, 54-
maximum work week
for women and minors,
no workers under the
age 14, and prohibited
work on Sunday



With the harsh living
and working
conditions factory
workers faced, many
labor unions formed
These Unions worked
to protect the interests
of its members.
One of the most
influential unions at this
time was the
American Federation
of Labor, led by
Samuel Gompers.


They focused on
wages, working
hours, and working
conditions.
AFL used strikes,
boycotts, and
collective
bargaining to make
changes.

Companies refused to
negotiate with unions
› Forbid union
meetings, fired union
members, forced
employees to sign
“Yellow-Dog
Contracts” promising
not to join a union or
take part in a strike

Membership in unions
decline


Established in 1884
Responsible for
occupational safety,
wage and hour
standards,
unemployment
benefits and services

1st organized in 1882 by Peter McGuire
› Proposed that the government dedicate a
day to “all who labor”
› Became a federal holiday in 1894
› Observed on the 1st Monday in September