Unit 5B: Second Industrial Revolution

Essential Question

— What factors led to the rise of the American Industrial Revolution from 1870 to 1900?

YAWP section 1

• The Great Railroad Strike of 1877 marked a significant era of labor conflict in the U.S.

• Following the economic downturn after the railroads' financial bubble burst in 1873, rail lines cut workers' wages despite receiving government subsidies.

• Strikes occurred across the country, from Baltimore to St. Louis, disrupting railroad traffic, which was crucial to the economy.

• In response to the strikes, state governors called out militias when local police were unable to control the situation.

• Strikers resisted, destroying rail property to prevent militias from reopening the rails.

• Violence escalated, with events such as the militia firing into crowds, causing multiple deaths among strikers.

• Striker protests led to destruction in cities like Pittsburgh and Reading, with significant property damage.

• A general strike in St. Louis aimed for an eight-hour workday and abolition of child labor; federal troops ultimately suppressed it violently.

• Federal troops were deployed across northern rail lines to restore order, defeating the strikes after six weeks.

• The strike resulted in nearly 100 deaths and $40 million in property damage.

• It highlighted the necessity of unions for workers, increased political influence for businesses, and signposted ongoing labor conflicts in the U.S. for decades to come.

YAWP section 2

• Growing labor unrest characterized the industrialization era, with railroads as the first major industry hit.

• Workers felt increasingly powerless against large corporations, facing long hours, unsafe conditions, and low wages.

• Post-Civil War, the U.S. industry underwent revolutions due to technological innovations and national investments that reduced production costs.

• The rise of scientific management (Taylorism) emphasized efficiency through division of tasks and standardization.

• Companies, such as McCormick's, transitioned to mass production, vastly increasing output and leading the U.S. to become the world's leading manufacturing nation by 1900.

• Economies of scale allowed firms to profit by increasing production while lowering costs.

• The corporation became a legal structure that facilitated capital mobilization with limited shareholder liability, promoting industrialization.

• Intense competition led to instability in profits, prompting companies to consolidate through mergers and price-fixing to maintain control over markets.

• The great merger movement from 1895 to 1904 saw around 4,000 companies consolidate, leading to monopolistic dominance in various industries, notably with the creation of U.S. Steel by J.P. Morgan.

YAWP section 3

• Industrial capitalism led to unprecedented efficiency and productivity gains.

• Massive companies generated enormous profits, creating significant wealth, but also millions of low-paid, unskilled jobs.

• Working conditions were often long and hazardous, highlighting social inequities.

• The term "Gilded Age" emerged from Mark Twain and Charles Warner's 1873 satirical novel, reflecting wealth masking deep societal issues.

• There was a shocking juxtaposition of extreme wealth against the poverty of the urban and rural poor, causing public concern.

• By 1890, the wealthiest 1% owned a quarter of the nation’s assets; by 1900, the richest 10% may have controlled 90% of the wealth.

• New ideas justified the wealth accumulation, with social Darwinism becoming popularized; it suggested that economic success indicated superiority.

• Herbert Spencer's notion of "survival of the fittest" applied to society was embraced by industrial elites who believed inequalities were natural and beneficial.

• Many influential figures, including Carnegie and Rockefeller, endorsed Spencer’s social Darwinism.

• In contrast, many Americans were troubled by economic inequalities, even as industrial capitalism flourished.

• The Republican Party, initially an anti-slavery faction, became a staunch supporter of business during the Gilded Age, facilitating the interests of capital over labor.

YAWP section 4

• Social Darwinism had little support among American industrial laborers who faced difficult jobs and low pay.

• Mechanization and mass production forced skilled laborers into unskilled positions.

• Industrial work was unstable, with workers typically unemployed for about one month a year.

• Workers labored sixty hours a week and often earned less than the poverty line; many families required wives and children to work.

• Crowded cities struggled with urban population growth, leading to high rents and slum conditions.

• Strikes became common in the late 19th and early 20th centuries as workers sought better wages and conditions.

• The failure of the Great Railroad Strike of 1877 highlighted the necessity for organization among workers.

• The Knights of Labor aimed to unite skilled and unskilled workers and grew to over 700,000 members by 1886.

• The campaign for an eight-hour workday culminated in a national strike on May 1, 1886, drawing 300,000 to 500,000 participants.

• The Haymarket Riot in Chicago led to negative perceptions of the labor movement and a swift decline in Knight's membership.

• The American Federation of Labor (AFL) emerged as a conservative alternative focusing on practical gains through trade unionism.

• The Homestead Strike of 1892 and the Pullman Strike of 1894 illustrated the struggles between laborers and industrialists.

• Despite defeats, strikes and labor unrest persisted, with over twenty thousand strikes and lockouts occurring by the end of the century.

• Both workers and farmers fought against economic inequalities and political corruption in Gilded Age America.

Notes

• During the Gilded Age, the United States experienced a Second Industrial Revolution

• America’s industrial revolution began as a wave of inventions

  • Typewriters, Cash registers, and calculator (adding machines)

• The Bessemer Process created a cheap way to transform iron into stronger, lighter steel

• new inventions allowed for improved industrialization

• Thomas Edison (the “Wizard of Menlo Park”) was the greatest inventor of the 1800s

  • invented the 1st phonograph, audio recorder and battery

  • he made the 1st electron light bulb

• America’s industrial Revolution was fueled by 4 major industries (R.O.S.E)

  • Railroads

    • The Railroad was America’s first “Big Business”

    • Railroad construction boomed, led by tycoons like Cornelius Vanderbilt

    • Led to a boom in technology

    • Stimulated demand for coal, oil, iron, and steel

  • Oil

  • Steel

  • Electricity

• Steel led to skyscrapers, longer bridges, stronger railroads, and heavier machinery

• The iron and steel industries were dominated by Andrew Carnegie

  • Carnegie best represented the American dream because he went from a poor immigrant to the richest man in the world

  • Carnegie Steel Co

  • Carnegie did not pay his employees very much and did not allow unions in his factories

  • He was a philanthropist

• The oil industry during the Gilded Age was dominated by John D. Rockefeller’s Standard Oil Company

  • Industrialization led to a demand for oil for lubrication and kerosene lighting

  • Rockefeller used ruthless tactics to buy out competing companies

  • by 1879, Standard Oil sold 90% of the oil in America (Monopoly)

  • Charged with having a monopoly and splits into 19 companies

  • Rockefeller took advantage of his workers and used his fortune to influence the national gov’t

• American Finance was dominated by JP Morgan

  • Industrialization led to a demand for financing so banking became a significant part of the Gilded Age

  • He was so influential that he bailed out the railroad industry when they were in trouble

  • He helped ease an economic depression during the Panic of 1907

  • Made the company US Steel

• Industrialists like Vanderbilt, Carnegie, Rockefeller changed the way businesses were organized

• Corporations became a more common business structure

• Companies merged to make more money

• Companies like Standard Oil used horizontal integration to buy similar companies to reduce competition

• Companies like Carnegie steel used vertical integration needed to buy companies in order to gain materials needed to make or deliver their products

• Mono posits justified their wealth in a variety of ways

  • The “Gospel of Wealth” argued that it is God’s will for some men to gain great wealth so they could serve the public

  • Social Darwinism taught that natural competition weeds out the weak and allows the strong to survive

  • The government used laissez-fiare (hands off) policies toward big business

  • The Lack of Regulation allowed businesses to become very powerful

Conclusions

America was changed by the industrial revolution

• A. The US led the world in industry innovation, and wealth

• B. Laissez-fiare gov’t policies and new business tactics led to monopolies

• C. But the gap between the wealth monopolist and their poor immigrant workers grew wider

Dates

• 1873 - Financial bubble burst causes economic downturn affecting railroads.

• 1877 - The Great Railroad Strike occurs, marking significant labor conflict.

• 1879 - Standard Oil controls 90% of the oil market in America.

• 1895-1904 - Great merger movement, approximately 4,000 companies consolidate.

• 1907 - Panic of 1907, JP Morgan helps to ease the economic depression.

Vocab

• horizontal integration - Buying up all companies that do simular or the same thing as you

• Vertical integration - Buying up companies that are needed to make or deiver on their products

• Trusts - Monopolies

• laissez-fiare - hands off approach used towards big businesses that gov used

People

• Alexander Grand Bell - Invented Telephone

• Thomas Edison (the “Wizard of Menlo Park”), the greatest inventor of the 1800s

• Cornelius Vanderbilt - Railroad Tycoon

• Sir Henry Bessemer - Invented the Bessemer Process for steel

• Andrew Carnegie - Carnegie Steel Co. (Philanthropist)

• John D. Rockefeller - Standard Oil, First Monopolists

• JP Morgan - Led American Finance