Labor and Economy
Hannah DavisMorgan Harrell Aaron Koch
Thesis: Although the United States began as an economic underdog, it grew to a world superpower through a combination of the shifts from an agricultural economy to an
industrial giant, from small isolated businesses to big international corporations,
and from isolated regional labor organizations to powerful national labor
unions.
Mercantilism An economic system to
gain wealth by controlling colonial trade
Navigation Acts- passed by Parliament 1. goods could only be traded with England 2. All trade goods had to be transported on English ships 3. all trade goods had to pass through English ports to be taxed
Indentured Servants 1607 first Virginia
planters arrive with indentured servants
2/3 of the Immigrants that arrived the Colonies were originally indentured servants
Indentured Slaves Indentured servants
maintained some rights unlike slavery
Contract often included land and other necessities
As demand for labor increased land owner’s turned to slavery
Slavery 1619 First Slaves
arrive in Virginia Massachusetts passed
the first slave laws in 1641 and Virginia followed 20 years later
In certain area’s the slave population made up 50-60% of the overall population
Cotton Gin
Eli Whitney invented it in 1793
Lead to an increase of cotton production (“King Cotton”)
Louisiana Purchase
The Haitian Rebellion
Louisiana Purchase Opened up New
Orleans Port, helped Western Farmers and increased Labor in the South 1803
Jefferson vs Hamilton Strong Federal Government
National Bank Constitutional
Merchant/Business Economy
National Government helps pay State Debts
Supported by the elites(Merchants, industry,
landowners, investors, lawyers, clergy)
Limited Federal Government
National Bank Unconstitutional
Farming Economy
National Government pays only National Debt
Supported by common people(farmers, tradesmen)
Jefferson vs Hamilton
Strict Construction
Opposed National Bank
Constitution is inflexible; the government can only do what is literally stated
Against Bank- not in Constitution
Loose Construction
Supported National Bank
Constitution is flexible; it sets guidelines for government power
For Bank- gov’t needed bank to regulate trade
War of 1812 British Blockade
forced Americans to become more independent
Regions became more interdependent
American System A pre-Civil War set of
measures designed to unify the nation and strengthen its economy with protective tariffs, a national bank, and such international improvements as the development of a transportation system
American System I.D.In 1815 under President Madison the American System was put into place. The goal of the American System was to help the US become economically independent. This happened by the US establishing the New National Bank (BUS) was
part of this system since it was time for a new charter to be put in place. Internal improvements such as roads and
canals were put into place which would bring the nation together. Protective tariffs (tax on imported goods) were
used to fund internal improvements and help the economy. This system was important because it allowed US citizens to
make progress and have pride in the country, it also eventually led to the “Era of Good Feelings” since there was
an increase in economic growth.
Jackson Era
1828 Third increase of “Tariff of Abominations”
1832 Jackson vetoes Bank of the US’s Charter
1836 Specie Cicular- Jackson tried to stop inflation- required people to pay government lands with specie= gold and silver caused banks to run out of specie
1837 Panic of 1837
Antebellum Years
Economy was mostly exporting goods
Labor was indentured servants and slavery
Big Business 1860 – 1906 Rise of Big Business
1859 Oil Drilling technique created ( Cars 50 years later)
1862 Homestead Act
1867-70s Grange (Patrons of Husbandry) -- farmers against railroads(populist movement)
1869 Transcontinental Railroad
1870-1890s Bonanza Farms
1880 Bessemer process established
1887 Huge iron and coal deposits found in Minnesota
1893 Panic of 1893
1896 Debate over Gold Standard
1900 Carnegie Steel biggest company in America
1901 US Steel buys out Carnegie steel (Holding Companies form)
Andrew Carnegie I.D. Andrew Carnegie was a Scottish
immigrant who created one of the biggest businesses during the turn of the 19th Century. He was the first to use the strategies of vertical and horizontal
integration. Carnegie was important because he was the first of the big
business leaders and was America’s first “rags to riches” story.
Major Strikes
1836- Mill Girl Strikes 1870- Grange Wars 1886- Haymarket Affair 1893- Pullman Strike
Mill Girl Letter to Boston Newspaper
S- Lowell Factory working conditions for the girls O- Lowell, MA in November of 1844 (Boston Newspaper)A This letter is directed to members in the MA community.P- To inform the public of the tough treatment of the young girls who work 16 hour days and within a 24 day time period only make $14. 52 and they are punished if they don’t get their work done. There wages keep getting cut and they work harder every day.S-The author is a worker at the factory who is losing hope in her job because they have to pay for food and board while wages are low and prices and work days continue to get higher/longer. She is overworked. She is writing for all the workers at the factory.
WWI Labor Issues 1919- First Red Scare 1919- Year of Strikes Boston Police Strike Steel Mill Strike Coal Miners’ Strike IWW (International workers of the
world- accused of being communists) Labor Movement of Loft Appeal because
of connects of communism
Roaring 20s (Coolidge Era)
Laissez- fair because of WWI
Standard of Living increase but extreme income gap
Crash Black Tuesday- stock market crash (panic) Suicide Rates triple in 1929 S – Notice bottom right, “Billions lost” and
“Panic” in the title; these two phrases perfectly reflect Black Tuesday.
Great Depression Hoovers Econ Policy- “Too little, Too late” Sad and Poor S-The Great Depression not only put the US
economy into a depression but people fell into depression because there were not jobs available. People had to move out of their homes and into the street.
FDR and New Deal ABC soup Economy
FDIC SEC- securities and exchange commission
Labor Wagner Act NLRB Fair Standards Act Social Security Act of 1905
WWII and Coming out of Great Depression
1940-1945- Government takes over economy OPA NWLB WPB
Post WWII Economy 1946- Unemployment Rises (Normalizes) Inflation Skyrockets
Because of fragility during the war, people wanted to spend $
Taft Hartley Act (Anti- Labor Act)
Taft- Hartley Act The Taft-Hartley act was proposed by Senator Robert Taft and Representative Fred Hartley in 1947 to amend the Wagner Act of 1935 as well as nullifying parts of the Federal Anti-Junction
Act of 1932. The Taft- Hartley act was originally vetoed by President Truman but was passed by congress, the act was a
labor demobilization effort by congress, the Act further empowered the National Labor Relations Board, limited the union’s ability to strike, allowed the federal court to enforce collective bargaining, permitted states to pass right to work laws, and banned closed shop unions. The Taft-Hartley Act
was significant not just because it severely restricted unions but because the Taft Hartley Act shifted the balance of power
away from unions and once again back to big business owners similar to the start of the Gilded Age.
50s Laissez- Fair Automania- American obsession with
cars, lots more cars and roads, pollution rises
Rise of the Suburbs
LBJ 64-66- LBJ’s Great Society (led to decrease
poverty but increased national debt) Space Program- increased defense system
and focused on education
Nixon/Ford (1969-1974) Slagflation (67-73)- high unemployment
combined with high inflation OPEC Embargo (73- 74)- sent inflation sky
high 74 trade resumes, prices quadruple
Nixon opened up trades again with China which led to US products being made in China and 3rd world countries
Carter(77-81)/ Reagan Carter Admin- second OPEC price spike-
incomplete embargo Inflation rose to double digits
Reagan Admin.- Reaganomics- trickle- down theory, taxes cuts, budget cuts, increase defeciet spending
Discuss the economic and political reasons for the establishment of unions after the Civil War.
Although the economy was prosperous after the Civil War, conflicting views between big business owners and laborers caused the formation of unions, such as the Knights of Labor and the American Federation of Labor, due to the decreasing wages, while an increase in the cost of living, and a larger profit margin of the businesses.
Outline 1. Decrease in wages
a. Mass production b. Poverty of Population (Jungle) c. Unskilled v. Skilled labor
2. Increase in Cost of Living a. Pullman Strike
I. Due to increase in rent II. Cost of food went up
b. Population density increase ->Supply/demand imbalance I. First arrived in the Jungle
3. Larger profit margin a. Mass production -> Cheaper Product b. Business profit increase while worker wage decrease
unhappy labor
Cause and Effect Cause: British continued taxing goods that
the colonist bought and needed (helped the British economy)
Effect: The Revolutionary War Cause: Eli Whitney used interchangeable parts
in factory assembly lines Effect: Mass production and better American
economy because exports could be shipped more frequently
Cause and Effect The Pullman strike was caused by a decrease in wages while
the price of housing was maintained at the same rate. The Pullman Strike was important because it was one of the first national strikes and affected about two thirds of the United States. By the end of the strike many strikers were without jobs and were living in worse conditions than before and George Pullman, owner of the Pullman Company, lost an estimated $5 million dollars.
Slavery was caused by the need for a cheap labor force in the new colonies and lasted until the Civil War and was officially ended in 1865 when the 13th amendment abolished slavery all throughout the nation. Slavery affected the economy because it provided a cheap work force which in turn lowered the prices of goods, but slavery was one of the main causes in the Civil War.
Cause and Effect WWII is often credited with ending the Great Depression; and
it did bring unemployment to a record low. However, WWII was also responsible for the slump of the 60s and 70s. Due to war damages, European countries no longer had a high demand for American goods. This led to the high unemployment rates of the 60s and 70s.
Cause Effect WWII End of Great Depression Poorer global economy
Historians now blame Jackson’s Specie Circular for the Panic of 1837; however, land speculation and bad banking practices were the reason for the Specie Circular.
Banking Policy- Underlying Cause Specie Circular- Perceived Cause Panic of 1837- Ultimate Effect Irresponsible speculation- underlying Cause
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