lecture #2 The Second Industrial Revolution: An Exhaustive Study Guide

Context and Scope

This period marks a transition in the American economy, shifting focus from the West back toward the East, though the two regions influenced each other simultaneously. While some economists argue there is technically only one Industrial Revolution (the point at which a country transitions to mass production), historians categorize this era as a distinct "Second Industrial Revolution."

Timeline

  • Began: Immediate aftermath of the American Civil War (1865)

  • Momentum: Gained significant momentum in the 1870s

  • Duration: Lasted through the end of the 19th century

Categorical Difference

  • Widespread impact on economy, society, culture, and politics

  • Altered American self-perception and global positioning

Societal Impact

  • Changed daily life including work, shopping, leisure, and travel

  • Emergence of mass consumers supported by mass production and advertising

Progress and Disruption

  • Significant improvements to quality of life (healthier, convenient, enjoyable)

  • Created disparities: winners and losers, social instability, and urban migration

  • Economic power shift to the United States, highlighting wealth inequality

Distinctions Between Industrial Eras

  1. Original American Industrial Revolution

    • Timing: Late 1820s to 1840s

    • Key Features: Rise of textile industry, beginning of railroads and steamboats, growth of armaments industry

  2. Second Industrial Revolution

    • Timing: Aftermath of the Civil War (1870s to 1890s)

    • Scale: Greater than the first, elevating the U.S. to world power status

The Civil War as an Industrial Catalyst

  • The Pump-Priming Effect

    • War duration: 1861-1865; a massive conflict spanning over 1,000 miles

    • Mobilization:

      • Confederate Personnel: 1,000,000 to 1,500,000 men

      • Union Personnel: 2,000,000 to 2,500,000 men

      • U.S. Navy: Grew to 600 ships

  • Technological Leaps

    • Innovations: Repeating firearms, ironclad warships, improved food canning, transportation logistics

  • Lessons in Logistics

    • Required mass production, purchasing, and distribution for military supplies; skill sets transitioned to civilian sectors post-war

Foundational Elements of Industrial Growth

  1. Natural Resources

    • Abundance: Coal, iron, timber, petroleum, water power

    • World’s largest deposits of iron ore

  2. Labor Force

    • Native-born: 35 million population

    • Immigration Waves:

      • 1870s and 1880s: 8 million arrivals

      • 1890 to 1914: 15 million arrivals

  3. Cheap Labor Economics

    • High worker volume kept labor costs low

  4. Social Attitude

    • Values: Capitalism, free market, private property, personal improvement

The Four Stages of Industrial Development

  1. Innovation: Breakthroughs in technology/organization

  2. Widespread Entrance: Multiple competitors enter the market

  3. Cutthroat Competition: Price undercutting, shrinking profits

  4. Organization and Monopoly: Dominance by a few for efficiency and sustainability

  • VCR Analogy: Late 1970s VCR market showcasing competitive stages reverting to efficient monopolies

The Titans of Industry: Robber Barons and Captains

  • Dual Perspectives:

    • Robber Barons: Those who profited from unfair practices

    • Captains of Industry: Visionary leaders propelling growth and job creation

  • Thomas Nast:

    • Political cartoonist who coined "robber barons" and created iconic symbols like Santa Claus

The Central Role of the Railroads

  • A National System:

    • Essential for distributing raw materials and products

  • Economic Specialization:

    • Regional specializations (e.g., St. Louis for beer, Pittsburgh for steel)

  • Government Support:

    • Land grants totaling 170 million acres for railroad companies

  • Track Mileage Statistics:

    • 1865: 35,000 miles

    • 1916: 254,000 miles

  • Consolidation: J.P. Morgan's acquisition of controlling interests streamlining the industry

The Evolution of the Steel Industry

  • Strategic Importance: Benchmark for national power; U.S. steel production statistics:

    • 1874: 50% of England’s

    • 1900: Four times as much as Britain

  • Andrew Carnegie: Innovator of vertical integration; transitioned from telegraph operator to industry titan

    • Growth in profits exemplified through Carnegie Steel's financial success

    • Gospel of Wealth: Philanthropic distribution of wealth

    • The merger transitioning Carnegie Steel into U.S. Steel

The Petroleum Industry and Standard Oil

  • Early Development: First oil well in 1859; uses expanded from lubricants to lighting

  • John D. Rockefeller: Standard Oil founder; market dominance and elimination of competition

  • Financial Legacy: Substantial wealth at retirement; set stage for future industries

The Technological Explosion and Patent Surge

  • Patent Statistics: Significant increments in patents over decades

  • Thomas Edison: Innovator of the "business of inventing"

  • Key Inventions:

    • Typewriter (1867), Telephone (1876), Cash register (1879), Kodak camera (1879)

The Birth of Modern Marketing and Consumer Culture

  • Marketing Firms: New firms focused solely on product promotion

  • Mail Order Catalogs: Unification of the market across rural and urban areas

  • New Retail Models: Emergence of department stores and self-service grocery models

  • Modern Precursors: Foundations of current shopping and technology systems

Questions & Discussion

  • What is the name of the man who invented the "business of inventing"?

    • Thomas Edison.

  • What was the name of the process given to the innovation that allowed for the mass production of steel?

    • The Bessemer Process.

  • Which robber baron became the world's first billionaire?

    • Andrew Carnegie.

  • Of all the industries in the Second Industrial Revolution, which one was absolutely essential?

    • The Railroad industry.

  • What was the name of the company that results from the merger of Andrew Carnegie's and J.P. Morgan's steel empires?

    • United States Steel (US Steel).