Industrial Revolution (after Civil War)

Railroads:

• Government play in a crucial role in the nation's industrial expansion after the Civil War
• More railroads were built up to the 1900s
• Transcontinental railroad building was costly and risky so it required government help
• It promised national unity and economic growth
• Land grants for railroads were made in belts along the route
• Within these belts, they were allowed to choose alternate mile square sections in a checkerboard pattern
• Railroads withheld all land from other users until they determine the location of tracks and decided which sections were the choicest sections
• In 1887 President Cleveland ended it and allowed settlement in unclaimed land grant areas
• People later criticize that giving land to railroad companies was giving away valuable birthrights to greedy corporations
• The government got long-term preferred rates for postal services in military traffic
• Granting land was a cheap way to promote the transportation system because it avoided new taxes for direct cash grants
• Could turn the land into gold by using it as collateral for a loan from private banker or sell it
• Frontier villages turned into cities
• Others withered away and became ghost towns
• deadlock over the transcontinental railroad was broken when the south seceded leaving the land to the north
• After Fort Sumter Congress started to strengthen the union by connecting California to the east
• The union pacific railroad was created and started in Omaha Nebraska
• Railroad was the priority after the Civil War
• People in credit Mobilier construction company got a lot of profits
• They made more money than they used on construction and paid congressmen to look the other way so they were basically stealing from the government
• Central pacific railroad started building in California
• Big four, four forcing men were the chief financial backers of the enterprise
• They operated through two construction companies and made a lot of profit but they didn’t bribe
• There was the same subsidies and incentive to rush as Union Pacific
• Chinese laborers were cheap, efficient, and expendable but many lost their lives in explosions are other accidents
• Central Pacific railroad could only chip a few inches a day while the Union Pacific railroad used sledgehammers and was much more efficient
• In 1869 the rails met (wedding of the rails)
• People celebrated
• Union built 1086 miles in central built 689
• The transcontinental railroad connected east to the west and facilitated trade with Asia and allowed growth
• It was compared to the declaration of independence and the emancipation of slaves
• It also divided bison herds and sped up their near extinction
• It reduced food and supplies for Native Americans

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Railroads:

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• 4 other transcontinental railroad were built but had no loans from the government all but great northern received grants of land
• Northern pacific railroad was from Lake superior to puget sound
• South Pacific was from New Orleans to San Francisco
• Great Northern was from Duluth to Seattle and was created by James J Hill one of the greatest railroad builders
• Pioneer builders were over-optimistic, they didn’t want land bounties and pushed in areas that lack the potential population to support railroads
• If they didn’t succeed they declared bankruptcy which took down the savings of trusting investors
• bankruptcies, mergers, or reorganizations

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Other transportation:

• The success of western lines was facilitated by wielding together and expanding the older eastern network
• Vanderbilt made money in steamboat and then switch to railroads
• He offered railroads at lower rates
• He helped popularized steel rails which were safer and more economical because it could carry a heavy load
• Standard gauge of track width eliminated the expense and inconvenience of numerous changes from one line to another
• Westinghouse air brakes enhance efficiency and safety
• Pullman palace cars began to carry well-healed Travelers in the 1860s
• The cars (which were partly made of wood) contained kerosene lamp so alarmists called them torture chambers and potential funeral Pyres
• Despite safety devices like the telegraph, double tracking and block signal accidents continue to happen

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Iron and Steel:

• nation was united by iron and steel
• The nation’s biggest business and employed more people than any other industry
• It caused economic growth after the Civil War and opened the west with its wealth of resources
• Trains carried raw materials to factories and then took final goods back
• US was the largest integrated national market
• Where are the largest single source of orders for the steel industry
• It stimulated mining in agriculture in the west and took farmers Outland, carry the food to the market, and brought them back manufactured necessities
• Railroads played the leading role in cities
• They could carry food to many people and provide them with raw materials and marching
• Old companies stimulated immigration because they want to people that their land grants could be sold so they advertise in Europe and sometimes offered to transport newcomers for free
• Hurt land and because settlers who are following the roads plowed tall grass, planted corn fields and their cattle displaced Buffalo which were hunted
• Time was bent to the railroads' need so every town had its own time dictated by the sun‘s position
• This was very confusing/difficult for operators so on November 18, 1883 major rail lines decreed that the nation will be divided into four time zones
• People were baffled and reset their clocks (day of two noons)
• Railroads made millionaires
• New aristocracy (Lord of the rail) replaced all southerners (Lord of the lash)
• The lines became the playthings of Wall Street a stock speculators and railroad wreckers got rich

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Corruption in Businesses:

• railroad companies like credit Mobilier started to become more corrupt
• Jay Gould busted the stocks of the Erie, Kansas specific, union pacific, Texas and pacific railroads
• Stock watering is the practice of making cattle thirsty by feeding them salt and having them prove themselves with water before waiting for sale
• Railroad promoters inflated their claims of a line’s assets in profitability and sell stocks and bonds higher than its actual value
• Railroad managers were forced to charge excessive rates and wage competitions in order to pay off exaggerated financial obligations
• Cornelius Vanderbilt had so much power and money that he wasn’t scared of the law
• Railroad bribed judges and legislatures and elected their own people to office
• They showered free passes on journalist and politicians
• Wealthy kings, virtual industrial monarchs, were manipulators of a huge monopoly and had more control over the people than the president
• They began to ignore competition and collaborate to have total control
• They made pooling arrangements, agreements to divide the business in a given area and share the profits in order to protect their profits
• Others gave secret benefits to powerful shippers and turn for assured traffic
• They slashed their rates on route where they face competition but made up for it by charging more
• Small farmers usually paid highest rates while large customers got the best deals

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Farmers:

• Farmers, especially in the Midwest wondered if the nation escaped slavery power only to fall into financial power
• People are started the battle the economic injustice slowly because they remember Jeffersons ideals didn’t like the government interfering with business and the American dream, and hope that anyone could become rich
• Economic depression in the 1870s pushed farmers into protesting against being railroaded into bankruptcy
• Under pressure from groups like the grange, patrons of husbandry many Midwest legislatures try to help
• In 1886 the Supreme Court in Wabash, St. Louis and pacific railroad company V Illinois decreed that individual states had no power to regulate interstate commerce, between states
• Congress passed the interstate commerce act in 1887 which prohibited rebates and pools and required railroads to publish the rates openly
• It forbade unfair discrimination against shippers in outlawed charging more for a short haul a long one over the same line
• It’s set up the interstate commerce commission to enforce the new legislation
• Richard olney noticed that the new commission actually helped arose by providing a marketplace were competing business interest could resolve the conflict in a peaceable way
• Country could avoid rate wars and attacked by state legislatures
• ICA stabilized, not revolutionized the business system
• First large scale attempt to regulate business at the interest of society by the government
• Foreshadow the doom a business practices ensure that there was a public interest in private enterprise that the government was bound to protect

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Inventions:

• industrial expansion grew fast
• Civil War created fortune to the sale of goods during the time of emergency
• US dollars went into private hands while other countries dollars went to the public
• Innovations from transportation brought natural resources like coal iron in oil to factories
• Shipping systems through the great lakes carried iron for refining which helped make steel empire
• Size of America’s market encourages innovators to invent mass production methods
• Because of transportation across the nation in a large population anyone who had a new product that was available for a good price in large quantities thrived
• Captains of industry had incentive to invent machines
• They made it possible to replace expensive skilled labor with unskilled workers who are cheap and plentiful as a result from immigration
• Cash register, stock ticker, typewriter helped business operations while refrigerator car, electric dynamo, electric railway helped urbanization
• Alexander Graham Bell invented the telephone which created a whole new communications network
• Thomas Alva Edison invented the phonograph, mimeograph, Dictaphone in a lightbulb in 1879
• Light bulb changed working habits because they can now work at night

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Carnegie, Rockefeller, and Morgan:

• Andrew Carnegie, Steel king
• John D Rockefeller, oil Baron
• J Pierpont Morgan, banker’s banker
• Carnegie integrated every step of steel making
• He’s miners mind everything, his ships carried it, his railroads delivered it to furnaces
• Used vertical integration, combining into organization all phases of manufacturing

Was to improve efficiency by making supplies more reliable, controlling the quantity of the product at all stages, and eliminating middleman fees

• Rockefeller used horizontal integration, ally with competitors to monopolize the market
• He used trusts to control rivals
• Stockholders in various small oil companies gave their stock to the board of his standard oil company in 1870
• It consolidated the operations of the previously competing businesses
• Standard oil scene control the market
• Weaker competitions that didn’t use a trust went broke
• Depressions in the 1870s and 80s 90s give Morgan business people who failed due to competition
• He put officers of his own banking onto their boards of directors which is called interlocking directorates

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Bessemer process:

• Steel making for railroads was an example of heavy industry which concentrated on making capital goods not consumer goods
• Steel used to be rare and expensive so it was only used for cutlery and iron was used for railroad/bridges
• In the 1900s US is producing more steel than other countries
• 1850s Bessemer process was a method of making cheap steel
• William Kelly discover that cold air blown on red hot iron caused the metal to become white hot by igniting the carbon and eliminating impurities

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Carnegie and Morgan:

• Carnegie enter the steel business and succeeded by picking high class associates and eliminating middleman
• He was not a monopolist and dislike monopolistic trusts
• His organization was a partnership
• Morgan made a reputation for himself through his Wall Street banking house by financing to re-organization of railroads, insurance companies and banks
• He didn’t believe that money power was dangerous unless in the hands of a person who is dangerous and he didn’t believe he was
• In 1900 Carnegie wanted to sell because he was tired of making money off of steel and Morgan started to manufacture steel pipe tubing
• Carnegie threatened to invade the same business if Morgan didn’t receive his price
• Morgan agreed to buy out Carnegie for $400 million
• Carnegie dedicated the rest of his life to giving money to libraries, pensions for professors and philanthropic purposes out of fear that he would die disgraced with so much wealth
• Morgan to Carnegie‘s holdings and in 1901 launch the United States steel corporation, US‘s first billion dollar Corporation

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Oil:

• Oil industry grew out of nowhere
• Kerosene was the first major product
• It produced a brighter flame than whale oil so while kerosene industry boomed, whaling industry died
• Once Edison’s lightbulbs came kerosene lamps died
• Oil industry was dying until the invention of the automobile
• Gas burning internal combustion engine was better than steam and electricity
• Rockefeller organize a standard oil company in 1870
• He sought to eliminate middleman and competitors
• He used a little business ethics, had little mercy and believed in survival of the fittest
• In 1877 he controlled 95% of oil refineries
• Though he was obeying loss of nature his oil monopoly turned out to be a good product at a relatively cheap price
• Achieved important economics at home and abroad by production and distribution
• Trust like sugar, tobacco, leather and harvester were created
• Meat industry grew
• New trust overshadowed old American aristocracy of modestly successful merchants and professionals
• New rich was now in competition with patrician families for power and prestige

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The Wealthy:

• plutocrats, a person whose power comes from their wealth
• Rockefeller thought the good Lord gave me my money
• Carnegie preach that wealthy were only stewards of societies riches in our a blast assume moral responsibility for helping the less fortunate
• Most offenders relied on survival of the fittest
• Social Darwinist argue that individuals wonder stations in life by competing on the basis of their natural talents
• The wealthy/powerful demonstrated greater abilities and the poor
• Answers why are some nations were more powerful than others and have the right to dominate lesser people
• Self justification for why the wealthy felt contempt from the poor
• Many new rich work their way to the top so they thought the people who chose to be poor are lazy
• New Rich use the clause that gave Congress sole jurisdiction over interstate commerce to thwart controls by state legislators
• Giant trusts hid behind the 14th amendment
• Court interpreted a corporation to be a legal person so it cannot be deprived of its property by a state without process of law

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Sherman Anti Trust Act:

• people began to try to stop monopolies
• First they tried state legislatures but failed
• Congress created the Sherman antitrust act of 1890
• it forbade combinations in restraint of trade without any distinction between good or bad trusts, big not bad was the targets
• It was used to curb labor unions or combinations that were deemed to be restraining trade
• More trusts formed
• New principal card from the anti-trust act and interstate commerce act was the private read should be treated as less important as public need

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The South:

• South still produced a small percentage of the nations manufactured goods
• Plantation systems were now a pattern of absentee landownership
• Sharecropping and tenant farming occurred
• In 1880 machine made cigarettes cause tobacco consumption to go up
• James B Cannon Duke took the new tech to mass produce coffin nails
• He absorbed his main competitors into the American tobacco company
• Industrialist try to get the south in factories but it remained mainly rural
• Paper barrier of regional rate setting systems imposed by Northern Railroad interests was an obstacle for southern industrialist
• Where roads gave preferred rates to manufacture goods from north to south but discriminated in favor of southern raw materials the other way
• Tried to keep the south as a supplier raw materials but unable to make an industrial base
• Pittsburgh plus, which deposit of coal and iron should have given steal a competitive edge but still overlords brought pressure To bear on compliant railroad so they steal from Southern labor was not treated from Pittsburg
• South was better in manufacturing cotton textiles
• Northern textiles started building mills in the south in response to tax benefits and cheap non-unionized labor
• Mills made south’s economy better
• Cheap labor was south‘s main attraction for investor so keeping cheap flavor was a religion
• Southerners who were mostly white as blacks were excluded from most jobs, seek employment in the mills
• Hillbillies or lintheads worked all day
• They were paid 1/2 the northern counterparts, received payment as credit at a company store and had bad conditions
• Many saw it as salvation, first steady jobs and wages

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Class Division:

• Standard of living increased
• Enjoyed more physical comfort
• Factories increased so there was more demand in American labor so immigrants came flooding in
• Agriculture decreased
• Jefferson ideals as a nation of small freehold farms decreased
• Time was revolutionized
• Rural migrants and immigrants were used to the clock of nature and had to switch to a different system when working in factories
• As the typewriter and telephone were invented women found new social opportunities example Gibson girl magazine
• For middle-class women, jobs are usually marriage and small families
• Most women worked because they needed the money
• They work the same amount of hours and had the same working conditions as men but we’re paid less
• Class division increased
• Group of socialist emerged, many were immigrants
• In 1860 1/2 of all workers were self-employed
• Wages went up and times are good for workers
• Dependence on wages came with vulnerability of the swings in the economy
• Fear of unemployment increased
• Growing distance between work and class in middle class
• reformers struggle to introduce security, job and wage protection, provision for temporary unemployment
• Telegraph, 1866 and Suez canal, 1869 made international trade easier, cheaper and faster
• American products went all around the world

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Workers:

• wage workers didn’t share the same benefits with their employers
• Individual originality and creativity were stifled
• Less value on manual skills
• New machines displaced employees
• More jobs were created then destroyed but manual workers were still hit
• Glutted labor market handicapped wage earners
• Employers could take advantage of the railroad network and bring unemployed workers from anywhere to beat down Highway wage levels
• Individual workers were powerless against the industry
• The corporation could dispense the work or much more easily than the worker could to the corporation
• Employers good pool well through stock holders , retain high-price lawyers by loyal press, put pressure on politicians, import strike breakers, employee thugs to beat up labor organizers
• Corporations can call upon federal courts, had judges that would issue injunctions to stop striking
• If defines ensued the company could request state or federal authorities to bring in troops
• Employers could lock the door, lock out and starve them
• Compel them to sign ironclad oaths/Yellow dog contracts which were agreements to not join a labor union
• Middle class ignored strikes
• Wages were highest in the world
• People like Carnegie and Rockefeller made their way to the top so the commonly was at laborers could too
• Big business might combine into trust to raise wages but workers must not combine into unions to get higher wages

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Labor Unions:

• Labor unions had been disorganized in 1861
• Cost of living was incentive to unionization
• Natural labor union, 1866 represented a lot of workers
• Aimed to unified workers across locales and trades to challenge their bosses
• It’s good to Chinese and made minimal efforts to include women in blacks
• Blacks organize the colored national labor union
• Black workers support for republican party and racism prevented that you from working together
• Aim to settle dispute between eight hour workday but the 1870s depression left its staggering
• Wage reductions in 1877 set off strikes on railroads
• Knights of labor, the noble and holy order of the knights of labor 1869, started as a secret society until 1881
• Sought to include all workers in one big union
• Liquor dealers, gamblers, lawyers come up bankers, stockbrokers, basically nonproducers
• Included everyone but Chinese and they supported the Chinese exclusion act of 1882 and anti-Chinese riots
• Campaigns for economic/social reform like codes for safety and health
• Terrence V Powderly let the knights to victory in some strikes for eight hour workdays
• Successful strikes against Jay Gould’s Wabash railroad in 1885 membership to go up
• Labor disorders broke out
• May 4, 1886 the Chicago police had a meeting to protest alleged brutalities by authorities
• Haymarket Square, bomb was thrown killed people
• Police caught eight people and even though there were no proof that they had anything to do with the bomb they were charged with conspiracy
• Five dead, one suicide, three jail
• In 1892 John P. Altgeld Newly governor of Illinois let the three go
• He got abuse and praise, so is very controversial
• 8 hour movement suffered and strikes failed because the knights were associated with the people that were charged for the bomb
• The knights included skilled and nonwork skilled workers
• Unskilled workers could easily be replaced but skilled workers couldn’t and use that to their advantage to bargain
• Skilled got tired and sought refuge in American Federation of labor, exclusive skilled craft unions
• American Federation of labor 1886 created by Samuel Gompers consisted of an association of self governing national unions which each kept its independence
• No individual laborers allowed in the central organizations
• Softer attempts at social reforms
• sought better wages, hours and working conditions
• Closed shop, all union labor
• Used walk out or boycott
• The stronger craft unions of the federation were able to amass of war chest to help prolong strikes
• Attempted to speak for all workers but didn’t represent all of them
• Composed of skilled craftsman, carpenters and brick layers
• Let unskilled laborers, women, blacks fend for themselves
• Nonpolitical but they did attempt to persuade their friends to reward or punish at the polls
• Survived panic of 1893
• Labor disorders continued and strikers lost half of their strikes
• The greatest weakness was only embracing a small minority of people
• The public was beginning to concede the right of workers to organize bargaining and strike
• In 1894 Congress made Labor Day a holiday
• A few industrialist bargained with unions and signed agreements to avoid economic warfare
• Employees so fat and organize labor achieve/succeeded only after many more strikes/reserves

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