Pageant CH 24-Industry (512-538)

Chapter 24: Industry Comes of Age 1865-1900

Economic Disparity

• Wealth gap: The wealthy are becoming richer, while the poor depend more on them.

• Social contrasts are sharpening; wealth is visible through luxury items, juxtaposed with poverty (ex. barefoot children).

• Observers questioned why the best men were not in politics but were drawn to the booming private economy, seeking profits over public service.

Transformation of the National Economy

• As of 1900, the U.S. had 192,556 miles of railroad, exceeding the total for Europe.

• The railroad expansion was crucial for national unity and economic growth, shifting from an agrarian economy to an industrial powerhouse.

• Agriculture significantly declined from being the largest business to less than half of the economy by 1900.

• The U.S. transitioned from importing more goods than exporting to surpassing $600 million in manufactured exports by 1900.

• Strong economic growth resulted from foreign investment, labor, trade, and technology.

Government Involvement in Railroads

• Government subsidies were necessary for railroads due to the high cost and risks of construction.

• The U.S. government provided land grants, aiding the construction of railroads, amounting to over 155 million acres.

• President Grover Cleveland opened unclaimed land for settlement in 1887, unlocking vast amounts of land.

Railroad Construction

• The construction of railroads began the post-Civil War expansion, with the Union and Central Pacific Railroads being vital for linking the East and West.

• The Union Pacific received significant land grants from Congress, with funding ranging from $16,000 to $48,000 per mile built, depending on terrain.

• By 1869, the transcontinental railroad was completed, greatly facilitating transport and trade.

Economic Dynamics

• The railroads became vital for transporting goods and resources, leading to significant economic integration.

• Railroad expansion created booming towns and cities, while those bypassed struggled and became ghost towns.

• The expansive railroad network allowed raw materials to be transported to factories and finished goods to be distributed nationwide.

Labor and Employment

• The workforce was often made up of immigrant laborers, particularly in hazardous jobs like railroad construction and mining.

• Fatal accidents were common, particularly among immigrant workers, reflecting their expendable status.

The Rise of Trusts and Monopolies

• The Gilded Age saw the rise of powerful industrialists (e.g., Carnegie, Rockefeller) who utilized strategies like vertical and horizontal integration.

• Monopolies controlled large portions of industries, often leading to practices considered corrupt and unethical.

• The trusts emerged, significantly impacting the economy and public perception, leading to calls for regulation.

Government Regulation

• In response to abuses by railroad companies and industrialists, the Interstate Commerce Act and Sherman Anti-Trust Act were implemented.

• The Interstate Commerce Commission was established to regulate railroad rates and practices.

• The Sherman Anti-Trust Act prohibited anti-competitive practices, aiming to dismantle monopolistic structures.

• National discontent led to increased public scrutiny of corporate practices and a push for worker rights.

Labor Movements

• Labor unions began to form, driven by the need for better working conditions, pay, and hours, exemplified by the Knights of Labor and American Federation of Labor.

• Labor strikes, such as the Haymarket Square incident, highlighted tensions between labor and management, further complicating public perceptions of workers.

• The labor movement showed promise, but it faced significant challenges from powerful business interests and government.

Final Reflections

• Rapid industrialization transformed America's economy and social fabric by the end of the 19th century.

• The emergence of a distinct working class was met with resistance from wealthy industrialists and complicated by issues of race and gender.

Chapter 24: Industry Comes of Age 1865-1900

Economic Disparity

• Wealth Gap: The wealth gap widened significantly, with the richest individuals, often referred to as the "captains of industry," accumulating astronomical fortunes, while a growing number of poor depended increasingly on the rich for employment and charity.

• Visible Luxury vs. Poverty: Social contrasts became starkly visible; wealth was flaunted through luxury items, large estates, and opulent lifestyles juxtaposed against extreme poverty, exemplified by barefoot children wandering the streets in urban areas.

• Political Landscape: Observers and commentators began to question the motivations of society's elite, lamenting that the most talented individuals were more inclined to seek profits in the booming private sector rather than engaging in public service and politics, thereby neglecting civic duties.

Transformation of the National Economy

• Railroad Expansion: By 1900, the United States boasted approximately 192,556 miles of railroad tracks, far surpassing the total mileage in Europe. This expansion was vital for national unity, facilitating not just transportation but also economic integration across states.

• Shift from Agrarian to Industrial Economy: The American economy evolved dramatically, as agriculture, once the largest sector, saw its economic share drop to less than fifty percent by 1900, signaling a transformation into an industrial powerhouse.

• Trade Dynamics: The United States transitioned from a nation that imported more goods than it exported to one that exceeded $600 million in manufactured exports by 1900, a sign of robust industrial capacity bolstered by rapid urbanization and technological advancements.

• Economic Drivers: Strong economic growth during this period can be attributed to a combination of foreign investment, a labor force that included immigrants seeking work, increased trade, and technological advancements (such as the assembly line).

Government Involvement in Railroads

• Subsidies and Land Grants: Due to the high capital requirements and risks associated with railroad construction, government subsidies became essential. The U.S. government provided over 155 million acres of land grants which facilitated the construction of railroads, effectively handing over land to private companies to spur development.

• Settling the West: In 1887, President Grover Cleveland opened vast unclaimed lands for settlement, further encouraging migration and expansion into western territories, resulting in demographic and economic shifts.

Railroad Construction

• Post-Civil War Expansion: The construction boom of railroads kicked off significant post-Civil War expansion, with the Union Pacific and Central Pacific railroads being pivotal in connecting the East and West.

• Financial Support: The Union Pacific railroad received considerable financial backing in the form of land grants from Congress, with funding ranging from $16,000 to $48,000 per mile built, depending on the difficulty of the terrain.

• Transcontinental Railroad Completion: In 1869, the completion of the transcontinental railroad marked a historic moment in U.S. history, greatly enhancing transport capabilities and facilitating trade across long distances.

Economic Dynamics

• Key Economic Role of Railroads: Railroads became indispensable for the transportation of goods and raw materials, promoting significant economic integration across the country.

• Impact on Towns: The railroad expansion led to the development of booming towns and cities in proximity to railroad lines, while towns that were not served by railroads struggled economically and became ghost towns.

• Nationwide Distribution: The extensive railroad network allowed for the movement of raw materials to factories, where goods were manufactured and subsequently distributed to markets nationwide, changing the landscape of commerce.

Labor and Employment

• Immigrant Labor: The workforce, crucial to this burgeoning economy, was often comprised of immigrant laborers who took on the most hazardous jobs, particularly in railroad construction and mining, where labor conditions were perilous.

• Safety Hazards: Fatal accidents were common, especially among immigrant workers, highlighting their precarious position within the labor market and reflecting their often expendable status in the eyes of employers.

The Rise of Trusts and Monopolies

• Powerful Industrialists: The Gilded Age was characterized by the emergence of powerful industrialists such as Andrew Carnegie and John D. Rockefeller, who mastered various business strategies, including vertical and horizontal integration, significantly concentrating wealth and economic power.

• Monopolistic Practices: Monopolies arose, controlling substantial portions of industries, leading to practices that often undermined fair competition and raised ethical concerns about business operations.

• Impact of Trusts: Collectively, these trusts emerged as powerful entities that significantly influenced the economy, shaping public perception and prompting calls for government regulation.

Government Regulation

• Legislative Response: In reaction to rampant abuses by railroad companies and powerful industrialists, key legislation such as the Interstate Commerce Act and the Sherman Anti-Trust Act were established to curb these excesses.

• Creating Oversight: The Interstate Commerce Commission was formed to regulate railroad rates and practices, ensuring fair access to railways and preventing practices deemed exploitative.

• Anti-Trust Movements: The Sherman Anti-Trust Act aimed to prohibit anti-competitive practices, seeking to dismantle monopolistic structures, marking the beginning of federal intervention in economic matters.

• Public Discontent: Growing national discontent led to increased public scrutiny of corporate practices and a push for robust legislation protecting worker rights and fair competition.

Labor Movements

• Formation of Unions: In response to dire working conditions, labor unions began to form, advocating for better working conditions, pay, and hours. Organizations such as the Knights of Labor and the American Federation of Labor emerged during this period.

• Labor Strikes: Notable labor strikes, including the infamous Haymarket Square incident, underscored the prevailing tensions between laborers and management, complicating public perceptions of the labor movement as it faced challenges from both powerful business interests and government retaliation.

• Challenges Ahead: The labor movement demonstrated potential but encountered significant hurdles, including violent opposition from business owners and a government often aligned with corporate interests, resulting in a complex struggle for workers' rights.

Final Reflections

• Industrialization's Impact: By the end of the 19th century, rapid industrialization had transformed America's economy and social structures, creating new challenges and opportunities.

• Emergence of the Working Class: The rise of a distinct working class was met with fierce resistance from wealthy industrialists, compounded by complex issues surrounding race and gender that further entrenched social divisions and present-day inequalities.