Homework Interpretations in American History Chapter 3

Homework: Interpretations in American History Chapter 3

New Industrialism Six features came to dominate the post-Civil War large-scale manufacturing: 1) Exploitation of coal as cheap energy 2) Rapid spread of technological innovation in communication, transportation, and factory systems 3) Demand for workers who could be driven and controlled 4) Constant pressure to defeat rivals through reducing costs and creating monopolies 5) Relentless drop in prices 6) Failure of the money supply to keep up with

The Iron Horse By 1865, there were only 35, 000 miles of rail laid. By 1900, that figure rose to 192, 556 miles. Growing railroads took up more land than they were allotted because their land grants were given over a broad path through the proposed route. The railroad owners would then choose the route to build on. President Grover Cleveland ended the land dispute in 1887 when he opened up all the unclaimed

Cornelius Vanderbilt A millionaire in the steamboat business who turned to railroads in the 1830 s. He brought two significant changes to the railroads: the steel rail and a standard gauge of track width. He and others, consolidated the railroads in the 1870 and 1880 s, and came to known as

Corruption on the Rails With great wealth and prosperity came much corruption: v In order to increase the weight of cows, "stock watering" was employed. It entailed forcing a cow to bloat itself with water before it was weighed for sale. This led to inflating stocks as well for huge profits. v Railroaders, feeling they were above the law, abused the public by bribing judges and legislatures. v Many rail barons granted rebates and kickbacks, or bribes, to powerful shippers in return for steady traffic.

Government Regulates Railroads With the onset of the depression of the 1870 s, came protests from farmers against railroaders who ran the farmers into bankruptcy. v. Many Midwestern legislatures tried to regulate the railroad monopoly. Munn v. Illinois (1877) opened the door for states to regulate certain businesses within their borders, including railroads, and was an important case in the struggle for public regulation of private enterprise in post-Civil War America. v. However in 1886, the Supreme Court ruled in the Wabash case that individual states had no power to regulate interstate commerce.

Government Regulates Railroads (Cont. ) v. In 1887, Congress passed the Interstate Commerce Act. It prohibited rebates and pools, required the railroads to publish their rates openly, forbade unfair discrimination against shippers, and outlawed charging more for a short trip than for a long one over the same line. It also created the Interstate Commerce Commission to administer and enforce the new legislation. v. By 1893, the viciousness of the rails weakened from a national depression, and

Steel Industry Steel was "king" during the industrialization era. Nearly every aspect of society used it. The United States soon outdistanced all foreign competitors and was producing one-third of the world's steel supply. The Bessemer process allowed for the price of steel to drop dramatically and for its production to be done with relative ease. The process involved blowing cold air on red-hot iron in order to ignite the carbon and eliminate impurities.

Andrew Carnegie was not a monopolist and actually disliked monopolistic trusts. He entered the steel business in the Pittsburgh area and created an organization with about 40 millionaires. By 1900, he was producing one-fourth of the nation's Bessemer steel. He eventually convinced J. P Morgan to buy his business for $400 million. Carnegie dedicated the rest of his life to donating his money to charities.

Vertical Integration To combine all phases of manufacturing into one organization. Andrew Carnegie and his business controlled every aspect of steel production, from mining to marketing. His goal was to improve efficiency.

Trusts An illegal combination of industrial or commercial companies in which the stock of the constituent companies is controlled by a central board of trustees, thus making it possible to manage the companies so as to minimize production costs, control prices, and eliminate competition.

Oil Industry Kerosene was the first major product of the oil industry. But, the invention of the light bulb rendered kerosene obsolete. By 1900, the gasoline-burning internal combustion engine had beaten out its rivals as the primary means of automobile propulsion. The birth of the automobile gave a great

John D. Rockefeller Organized the Standard Oil Company of Ohio in 1870, attempting to eliminate the middlemen and knock out his competitors. By 1877, he controlled 95% of all the oil refineries in the nation. Other trusts grew in addition to oil, including the sugar trust, the tobacco trust, the leather trust, and the harvester trust.

James Buchanan Duke Southern agriculture received a boost in the 1880 s when machinemade cigarettes replaced earlier methods of producing cigarettes. This caused tobacco consumption to shoot up. Duke took advantage of the growing tobacco business and formed the American Tobacco

Horizontal Integration To ally with competitors in the same industry to monopolize a given market. This tactic of creating trusts was used by John Rockefeller.

J. P. Morgan was a banker’s banker who financed the reorganization of railroads, insurance companies, and banks. Morgan expanded his industrial empire by buying Carnegie’s steel business and created the United States Steel Corporation in 1901. It was America's first billion-

Interlocking Directorates The practice of having executives or directors from one company serve on the Board of Directors of another. J. P. Morgan introduced this practice to eliminate banking competition in the 1890 s.

Business and Government Plutocracy, government controlled by the wealthy, took control of the Constitution. The clause that gave Congress sole jurisdiction over the interstate commerce was a bonus for the monopolists; they used their lawyers to thwart controls by state legislatures. Large trusts also sought safety behind the 14 th Amendment, arguing that corporations were actually legal "people. "

Sherman Anti-Trust Act of 1890 The act forbade combinations in restraint of trade without any distinction between "good" trusts and "bad" trusts. The law proved ineffective because it contained legal loopholes and lacked the enforcement.

United States v. E. C. Knight Company A 1895 Supreme Court case brought against the Knight Firm, which controlled more than 90% of the sugar refining and was defined as a trust by the Sherman Anti-Trust Act. The court ruled that manufacturing products was not classified as interstate commerce, unlike distribution, thus the lawsuit against the firm was dismissed.

Alexander Graham Bell A teacher of the deaf, who had experimented with dead men’s ears to explain how hearing was possible. Using his knowledge of the ear and along with the study of modern communications, like the telegraph, he successfully created the first telephone.

Thomas Edison A very versatile inventor who was removed from school at a young age because of a misprognosis of his intelligence. From his laboratory in New Jersey he invented the phonograph, the mimeograph, the dictaphone, and the moving picture. His most famous invention was the

George Westinghouse Another remarkable inventor, who held more than 400 patents and was responsible for developing an air brake for railroads (1869) and a transformer for producing high-voltage alternating current or AC (1885). The current made it possible for the lighting of cities and the operation of electric streetcars, subways, and electrically powered

Notable Inventions v. Typewriter (1867) v. Cash register (1879) v. Calculating machine (1887) v. Adding machine (1888) v. Kodak camera (1888) v. Fountain pen (1884) v. Gillette’s safety razor and blade (1895)

Crafted Production Outside the large-scale industries, which mass produced products with machinery, specialty shops employed skilled workers who crafted products using machines, but catered to the individual. This technique worked well in the fashion industry, allowing them to shift style quickly with the

Advertising and Marketing Output tended to exceed what the market could absorb, so manufacturers of mass-produced merchandise developed advertising and marketing techniques to whet the consumer demand for the products. Brand names, trademarks, guarentees, slogans, endorsements, and other gimmicks were

The South’s Slow Economic Rise Despite the rest of the country’s rapid rise to industrialization, the South could not keep pace: v. Physical devastation v. Racism v. Scarcity of cities and towns v. Lack of capital and education v. Northern control of finances and patents v. Low rate of technological innovation v. Myth of the Lost Cause

“New South” v. Henry W. Grady and the Atlanta Constitution v. Tax exemptions and other incentives v. Birmingham Steel v. Recruitment of black labor v. Segregation, while restricting, opens doors to African American entrepreneurs

Cotton-Mill Economy Unlike the steel or mining industries, the cotton-mill industry employed similar tactics in the crop lien system as well as in the North earlier in the century: v. Mill workers made 30 to 50% less than New England workers v. Mill owners controlled the mill town, church, education, and store v. Preyed on the poverty and abundance of the rural population and created a system of perpetual poverty

Southern Lag Numerous obstacles laid in the path of southern industrialization: v Northern-dominated railroad companies charged lower rates on manufactured goods moving southward from the North, but higher rates when raw materials were shipped from the South to the North. v The "Pittsburgh plus" pricing system was economic discrimination against the South in the steel industry. Rich deposits of coal and iron ore were discovered in Birmingham, Alabama. The steel lords of Pittsburgh controlled its foundries. As a result, Birmingham steel was charged a fictional fee, no matter where it was shipped. v Profit hungry northerners, segregation, and having a

Rise of the Factory System v. Gradual steps from the workshop to the factory v. Manufactured products with machines increased the use of unskilled labor (contract system, lower pay, more employment of women and children) v. Hazards on the job were classified as the employee’s fault. Laws were passed to reduce the ability or want for safety and health regulations v. Workers banded together to aid one

Immigrant Labor v Typically used in unskilled and undesirable jobs v Although jobs were long, low paid, and dangerous, immigrants made more money in America than in their home country v Employers introduced timetables and piecemeal systems, provided low-cost homes, and sponsored temperance societies and Sunday schools to control employees

Women in the Industrial Age v Views on working were shaped by martial status, social class, and race v With industry expanding, many women preferred industrial work over domestic (stigma of “servants”) Black women were barred form this option v Despite low pay and awful working conditions, women loved the independence of making a wage

Rags-To-Riches? v. Horatio Alger – wrote dime novels that told of rags-to-riches stories through virtues of honesty, integrity, and hard work v 95% of industrial leaders came from middle or upper classes v. Race and ethnicity impeded many going up the social latter. Rags-to-respectability more accurate v. Average real wages increased for skilled and unskilled labor between 1860 and 1900, however, job security was limited v. By 1890, top 10% owned 73% of the

Rise of Unions Due to the rise in wage-earners in factories, the owners of the factories did not have any relationship with their employees. New machines displaced employees, but in the long run, more jobs were created than destroyed. Factory workers eventually began to go on strike, complaining of their wages. Corporations sometimes compelled their workers to sign "ironclad oaths" or "yellow-dog contracts" saying that the workers would not join a labor union. Some corporations even owned the "company town. The middle-class public grew tired of constant “wildcat” strikes, knowing that

National Labor Union Organized in 1866, lasted 6 years and attracted 600, 000 members, including the skilled, unskilled, and farmers. Black workers also formed their own Colored National Labor Union. The Colored National Labor Union's support for the Republican Party and racism of white unionists prevented it and the National Labor Union from working together. It supported an 8 hour work day, an end of convict labor, establishment of a Labor Department, currency and

Knights of Labor Led by Uriah H. Stephens and then Terence V. Powderly, the Noble and Holy Order of the Knights of Labor was formed in 1869. It sought to include all workers in one big union, women and blacks included, and campaigned for economic and social reform, including codes for safety and health, equal pay for women, graduated

Haymarket Square On May 4, 1886, Chicago police advanced on a meeting called to protest alleged brutalities by authorities. A dynamite bomb was thrown and killed dozens of people. Eight anarchists were tried and convicted; 5 were sentenced to death while the other 3 were sent to jail. In 1892, the governor of Illinois, John P. Altgeld, pardoned the 3 who were in prison. The Knights of Labor were blamed for incident at Haymarket Square and as a result, it lost public support.

American Federation of Labor Founded in 1886 and was led by Samuel Gompers. The federation consisted of an association of selfgoverning national unions, each of which kept its own independence. It sought for better wages, hours, and working conditions. The federation's main weapons were the walkout and the boycott. The greatest weakness of organized labor was that it still embraced only a small minority of all working people. The American Federation of Labor's inclusion of only skilled workers drained the Knights of Labor of its participants.

“Bread and Butter” Unionism Gompers is noted for having shifted the primary goal of American unionism away from social issues and toward the “bread and butter” issues of wages, benefits, hours, and working conditions, all of which could be negotiated through collective bargaining. He distrusted intellectual reformers, fearing their influence would divert labor’s efforts away from economic goals. To make unionism respectable as a bulwark against radicalism and irresponsible strikes, he encouraged binding written trade agreements and advocated the primacy of national

Closed Shop A union organizing term that refers to the practice of only unionized employees to work for a particular company. The AFL became known for negotiating closed-shop agreements with employers, in which the employer would agree not to hire non-union members.

“Wildcat” Strikes and Violence Strikes were a common occurrence in the late 1800 s, however, the violence was not something the public could stomach: v. Baltimore and Ohio Railroad strike (1877) v. Mc. Cormick Harvester Strike (1886) v. Haymarket Square (1886) v. Homestead Strike (1892) v. Pullman Strike (1893) v. Eugene V. Debs/American Railway Union v. Mother Jones/United Mine Workers v. Public support and the Federal Government

Laissez-Faire As early as 1776, the economist Adam Smith had argued in The Wealth of Nations that business should be regulated, not by government, but by the law of supply and demand. In theory, if the government kept hands off, businesses would be motivated by their own self-interest to offer improved goods and

19 th Century Conservative Economics In the 19 th century, American industrialists appealed to the laissez-faire theory to justify their methods of doing business, even while they readily accepted the protection of high tariffs and federal subsidies. The rise of monopolistic trusts in the 1880 s seemed to undercut the very competition needed for natural regulation. Even so, among conservatives and business leaders, the laissez-faire theory was constantly invoked in legislative halls and lobbies to ward off any threat of government regulation.

“Gospel of Wealth” A number of Americans found religion more convincing in justifying the wealth of successful industrialists and bankers. v. Rockefeller – Protestant work ethic: “God gave me my riches” v. Reverend Russell Conwell – Acres of Diamonds preached that everyone had a duty to become rich v. Carnegie – Wealth essay argued that the wealthy had a God-given responsibility to carry out projects of civic philanthropy for the benefit of society

Social Darwinism Popular in the late 19 th century, believers of this theory thought that people gained wealth by “survival of the fittest. ” Therefore, the wealthy had simply won a natural competition and owed nothing the poor, and service to the poor would interfere with this organic process. Some also believed that this theory applied to whole nations and races, meaning that powerful peoples were naturally endowed to be superior over

Other Social Theories v. Lester Frank Ward and Dynamic Sociology v. Henry George and Progress and Poverty v. Edward Bellamy and Looking Backward v. Marxism