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Transcript of Natural resources- iron, coal, lumber Huge workforce- including large number of immigrants...
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Industrialization
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Why did industrialization occur in the U.S. during the late 1800s and early 1900s?
Natural resources- iron, coal, lumber Huge workforce- including large number
of immigrants Transportation routes- railroads, rivers Power source- water, oil, electricity
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What types of industry existed?
1. Steel- iron that has been strengthened by heating it and combining it with other metals
Steel was used in the growth of railroads and cities (skyscrapers and bridges)
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Andrew Carnegie Carnegie started a steel business in 1873 By 1899 he was manufacturing more
steel than all of Britain He encouraged competition within his
company He used innovative techniques
(Bessemer process)
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The Bessemer Process
Henry Bessemer discovered that blasting hot air through the iron would create
stronger steel. This also proved to be a cheaper method to strengthen the steel.
(1850s)
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Carnegie used both horizontal consolidation and vertical integration to gain monopolies
on the products he manufactured.
Raw materials (coal and iron)
Mines Mines
Manufacturing (steel)
Steel Mills Steel Mills
Transportation (taking items to and from the mill)
Railroads Railroads
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HORIZONTAL INTEGRATION(CONSOLIDATION)
Combining many companies (that produce a similar
product) into one company
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Vertical Integration
One company owns all elements of production required to create a product
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J.P. Morgan
Morgan formed U.S. Steel in 1901 and bought out Carnegie Steel
Morgan was considered the wealthiest man in the U.S. and made his money on the railroads
Morgan made the steel industry a billion dollar industry
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What types of industry existed?
2. Iron/Coal Industry Alabama was a leader in both the coal
and iron industries but investors were from the North and wanted to maintain Northern power
Alabama had a large labor force Alabama laborers were often paid in
“scrip” which could only be used at the company store
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• Birmingham iron was cheaper but to keep areas like Pittsburg competitive, the “Birmingham differential” was created
• This was similar to a tax and it was added to iron produced in Birmingham
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What types of industry existed?
3. Oil John D. Rockefeller, Standard Oil Company Rockefeller used/created the “trust” method Because monopolies were “illegal” a trust
enabled stockholders to give control of their stock to the trust (trustees est. a board of directors that supervise stock movement)
By the early 1880s he controlled about 90% of the nation’s oil
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What types of industry existed?
4. Railroads This became a big industry after the Civil
War The federal government and businesses
saw the advantages a country could experience if it were linked by railroads
Steel production allowed RR growth The U.S. gov’t gave land grants to RRs to
encourage construction in the West
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Railroads led to the creation of towns and a more unified nation
Because RR stops needed to be scheduled, RRs adopted time zones
George Pullman- developed luxury cars in the 1880s and built a “company” town
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Corruption/Problems with Railroads
Credit Mobilier Scandal-1864-72; this involved graft and overpayment for services; the eventually investigation implicated members of Congress and increased public distrust of business
Railroad Strike-1877; workers went on strike to protest wage cut but Pres. Hayes sent in the army to end the strike (80,000 walked off jobs in 11 states)
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Interstate Commerce Commission
Est. 1886-87 to investigate/regulate RR activity but it had no real power until the 1900s
However, this was a break from typical “laissez-faire” view of the government
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Unions and Strikes
Factory work was unhealthy and dangerous
Workers were paid poorly with no rights Unions were created by workers to help
workers Owners were typically against unions
Blacklisted-employers would list “problem” employees and they would not be hired anywhere
Strikebreakers-(scabs) would work for less during a strike
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Knights of Labor
1st nationwide industrial union This union effectively used strikes Terence Powderly (leader) Allowed anyone to be a member Wanted
An 8 hour workday Equal pay for women To end child labor Government to play a role in helping workers
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Haymarket Affair/Riot
May 1886, Chicago Gathered to protest police violence
against strikers Bomb went off and 9 people (7 police)
were killed; about 100 injured 8 anarchists were convicted; no
association with labor but The Riot caused public support to be
against strikers/laborers
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American Federation of Labor
Est. 1886 Samuel Gompers, lead organizer Organization of skilled workers only Opposed immigrant labor Organized based on trade rather than
industry Wanted
Higher wages Better working conditions Collective bargaining
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Robber Barons
Term used as a negative way to refer to wealthy industrial leaders
They controlled all aspects of trade in a specific area
Very wealthy Increased the line between wealthy and
poor Carnegie and Rockefeller (examples)
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Inventions
Improved communication and helped the economy grow
Made life easier
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Thomas Edison
Light bulb, electricity, phonograph Menlo Park, NJ-first research lab Allowed scientist to experiment, learn,
and create Founded Edison General Electric (GE)
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Alexander Graham Bell
Telephone, 1876 Organized Bell Telephone Company that
became AT & T
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Additional Inventions
Radio, 1899; inventor- Marconi Telegraph, 1856; inventor-Morse Transatlantic Cable, 1866; inventor- Field
Has been replaced but idea used until 1960s when replaced by satellites
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