Industrialization and the Gilded Age
- Industrialization continued at a rapid pace in the years following the civil war
Technological Innovations
- **Bessemer Process **– increased the amount and the quality of steel being produced.
- This new steel was used to lay more miles of railroad track, to build the world’s first skyscrapers, and to make better machinery
- Steam engines, powered by burning coal to heat water, drove the textile mills, factories, and trains.
- During the late 1800s the center of coal mining was in the Appalachian Mountains of western Pennsylvania
- At first, oil was just used as a lubricant, later it was refined into kerosene for lighting.
- New sources of energy and transportation technologies have improved our mobility and our production capabilities
Electricity
- Inventors including Thomas Edison, Alexander Graham Bell, and Nikola Tesla turned electricity from a scientific curiosity into an essential tool for modern life
- AGB invented the telephone allowing for fast long distance communication
Other Inventors & Innovations
- This was a time period of many inventions **that improved the lifestyle and standard of living of many Americans. **
- Elias Howe - Sewing machine Clothing could be made cheaper faster and now at home. (1846)
- **Elisha Otis **– passenger elevators, the new technique of making steel allowed for skyscrapers, this created a need for elevators to carry people between floors. (1852)
- Christopher Sholes – typewriter, made businesses more productive and helped improve communications. Eventually led to computer keyboards. (1867)
- Wright brothers - Orville and Wilbur first successful manned flight - their flight lasted only seconds, but it opened the way for air travel at a dramatically increased speed and distance travelled.
Building the Transcontinental Railroad
- Civil war vets, Irish Laborers, and free blacks started working westward from Omaha
- Chinese workers started eastward from Sacramento.
- They met at Promontory Point, Utah.
The Impact of the Railroads
- Transcontinental railroad connected the different regions of the United States and Railroads became the lifeline to the West
- Trains brought the settlers and everything they needed to the West as towns sprang up.
- Trains returned to the East with the products the West produced, beef, wheat, lumber, and gold.
Development of a National Market
- National producers could ship their goods cheaper and would dominate sales in the West
- New methods of marketing and advertising gave manufacturers ability to expand across the nation.
Impact of Population Growth
- Population jumped from over 2 million to 76 million in just 50 years, cities were crowded
- A high birth rate and a constant stream of immigrants created a rising demand for goods and the growing population was a steady supply of cheap labor.
- Lumbering depleted the forests.
- Sodbusters would plow the Great Plains to plant crops
- Mining for gold and other precious minerals destroyed the land.
- The Railroads and buffalo hunters would soon wipe out the buffalo
- Rivers and lakes would be polluted.
New Types of Business Organization
- A corporation is a company chartered by the state and recognized as a separate ‘person’.
Corporations
- Corporations issue and sell ‘stock’ or shares of a company ’
- A shareholder is a partial owner, and they receive a share of a corporation’s profits based on the amount of stock they own.
The Free Enterprise System
- Free enterprise system is when people have the freedom to make their own choices in what to buy, where to work, and what to make
- People are free to use their money and time to start a business in hopes of making a profit. (Producers)
- People are free to choose the type of product they wish to buy and how much they’ll pay
Captains of Industry
- Many of the more successful entrepreneurs became known as ‘Captains of Industry’.
- Some called them ‘robber barons’ because of the ruthless tactics they used to destroy their competition and methods used to keep workers wages low.
- some of the best known were: John D Rockefeller Cornelius Vanderbilt Andrew Carnegie *
The Gilded Age
- The time when these Captains of Industry ruled America became known as the Gilded Age.
- They amassed fabulous wealth and lavishly spent it while the majority of Americans were poor.
- These ‘robber barons’ were glorified and vilified.
- Some became the richest men in the world.
Andrew Carnegie
- Carnegie started penniless, but he made is hofrtune in steel mills in the pittsburgh pa area.
- He undercut the competition, bought his own iron ore fields, coal mines and ships so he could control all phases of steel production.
- He crushed attempts to form labor unions, paid low wages, and forced laborers to work 12 hour days.
- The labor strike on Carnegie’s homestead steel mill would be one of the eras most violent
John D. Rockefeller
- **Rockefeller started out poor, but made his fortune in oil in Ohio **
- Kerosene, for lighting, made him millions, later the gasoline industry, would make him even richer.
- He used ruthless tactics to drive his competition out of business, then he would buy them out.
- His standard oil co became a trust, with him owning most of the shares
- Later it would be a monopoly as he controlled 90% of all oil refined.
Philanthropy
- Carnegie and Rockefeller both made millions at the expense of the American Public
- They paid low wages and demanded long hours of work.
- As businessmen they didn’t believe in charity, their belief was; ‘help those who help themselves’
- Later, both would lead the rich in philanthropy, they gave away millions of dollars to the public.
- They built libraries’, museums, scholarships, and universities.
Pros and Cons of Big Business
Pros
- Large businesses are more efficient which leads to lower prices.
- Hire large numbers of workers
- Produce goods in large quantities
- **Have the resources for expensive research and to invent new items. **
Cons
- Unfair competitive advantage.
- Often exploited workers
- Often unconcerned about pollution they may cause.
- Have an unfair influence on government rules that affect them
Laws Against Anti-Competitive Practices
**Interstate Commerce Act (1887) **
- Railroads often charged small farmers more to ship goods than large companies
- States passed laws to stop this, but the Supreme Court ruled these laws were unconstitutional.
- Congress finally passed the Interstate Commerce Act that prohibited unfair practices by the railroads.
- The Interstate Commerce Comission was created to enforce these laws
First time Congress had regulated big business.
Laws Against Anti-Competitive Practices
Sherman Anti-Trust Act (1890)
- Federal law aimed at stopping monopolies and trusts from engagin in unfair practices
- Attempted to prevent unfair competitive advantages.
- Act marked a significant change in the attitude of government about the abuses of big businesses
- Standard Oil was the 1st monopoly the government attempted to stop.