Chapter 17: Capital and Labor in the Age of EnterpriseI. Railroad boom started dying down so workers strike from Pacific Coast to SF.

called Great Strike of 1877a. After strike boom by 150%b. Armories came about around 1877 which were fortresses to withstand

assault by riotersII. Industrial Capitalism Triumphant

a. Late 19th century=Great Deflation not enough demand for goods in England

i. Industrial expansion in US went great allowing American firms to cut prices and still earn profits (increasing 50%)

b. Age of Steeli. Early manufacturing was an extension of preindustrial economy

ii. Railroad equip, machinery, construction materials were capital goods which helped nation produce more

iii. Steel makingwrought ironnot good b/c it wasn’t suitable for railroads and was very expensive

iv. Bessemer made the furnace which was called the Bessemer converter that made raw pig iron into steel(more durable and cheaper and did not require hands-on labor)

v. Andrew Carnegie and American Steel1. began working for Penn Railroad and then became his own

iron manufacturer2. struck out on wartime speculation w/ network in railroad

business3. had Bessemer converter as centerpiece and had 3 steps:

a. 1)blast furnaces smelt ore into pig ironb. 2)pig iron refined into metal that can be

used(iron/steel)c. 3)refined metal is sold

4. continuous operation of iron oresteel rails in Western Pennsylvania

5. rich minerals from Mesabi range in northern Minn to Great Lakes; also arrived from App field

6. coal production doubled every decade after 1870 exceeding 400 million tons by 1910

7. coal started being consumed a lot like with industries going from waterpowersteam

8. urbine used rotation rather than steam engine’s back and forth piston motion

9. steam turbine+electric generator=complete energy revolution

c. Railroad Boomi. Locomotives from Britain arrived and Americans wanted

something that could be year roundii. Constructing Railroads

1. railroad=free enterprise but government still played big role so states and locals offered $ aid

2. land grants by government urged interregional rail construction

3. corporation let private capital be raised and investors had limited liability meaning that they only risked money they themselves had invested

4. corporation borrowed money by having interest-bearing bonds which was how railroads raised money

5. railroad building was done by construction companies which involved trying to get them to accept railroad’s bonds as payment and then trying to get cash by selling/borrowing bonds

6. Union Pacific’s Credit Mobiler had half of the construction funds pocketed funds by promoters

7. John Murray Forbes-Boston merchant in “China trade who developed Chicago, Burlington, and Quincy Railroad in the Midwest”

8. Cornelius Vanderbilt started out with steamboat but made a railroad service between NYC and Chicago

9. James Hill made Great Northern into a great transcontinental railroad

10. Jay Gould was a stock market speculator and forced down rates and promoted integrated railroads

iii. Railroad System1. railroads became more efficient and gauges of track were

too wide and railroads were not connected at terminal points(stopped shipping between Massachusetts to South Carolina)

2. freight cars had to be emptied and transferred by river3. by end of 1880s there was a standard gauge (4x8.5) which

allowed shippers to move goods w/o breaks or transfers also a standard time zone

4. George Westinghouse made the automatic coupler, air brake, and friction gare for starting/stopping cars and cost per ton-mile dropped 50% between 1840 and 1890 which made for a drop in freight rates for shippers

5. ~1/5 of bonds didn’t pay interest(1889 good year) and 1/3 of industry went bankrupt

6. Wall Street investment banks tried to get investors to accept lower interest rates and by doing so more regional systems emerged+nerve system shifted to Wall Street

d. Large-Scale Enterprisei. After civil war=big businesses because American market didn’t

block flow of goods and had a large population(1870-90 40mil-60mil)

ii. Gustavus Swift+ Vertical Integration1. Union Stock Yards opened in 1865=cattle market for

country2. livestock was auctioned off at Chicago stockyards and

cattle were slaughtered at butchertowns 3. Swift saw that livestock lost weight to the East and that

slaughterhouses lacked scale to use waste by products so he wanted to make beef so that it could be processed in bulk at Chicago stockyards(like Armour&Co. for pork)

4. he invested in refrigerator cars and made a packing plant then he built network of branch house and a delivery wagon to process the fertilizers, chemicals , by products which expanded to Kansas, Fort Worth, Omaha

5. vertically integrated firm capable of handling its own structure and all functions of an industry and small businesses were driven out

6. oligopoly means market dominance by the few which made small slaughterhouses and livestock dealers disappear

7. greater market control impulse to drive out competition was strongest in bonanza industries (no player had an advantage and market was chaotic—petroleum)

iii. Rockefeller+Monopoly Power1. salesmen used it for their concoctions, farmers used it to

grease wagons2. 1850 figured out how to extract kerosene 3. Titusville, Penn Drake drilled and struck oil and makeshift

refineries sprung around Titusville 4. borrowed heavily and made his own firm Standard Oil of

Ohio which became a leading refiner5. railroad manufacturers offered him secret rebates that gave

him an advantage on competitors and under South Improvement Company they invited him+ other refiners to take over industry

6. he offered competitors to sell out or die and then he took over Cleveland industry while his firm retained 95% of the oil

7. wanted an international market so added networks, oil pipe lines, tankers, and a big stake in oil fields

iv. Consumer Marketing1. rural customers=mail order enterprise from catalogues2. department stores from Wanamaker in Phil which

became a staple 3. social class wasn’t able to be differentiated through clothes4. people were thinking that beef couldn’t stay fresh after a

few weeks

5. advertising came into play over 90 million was spent for ads

v. Managerial Rev1. McCallum wanted railroads to begin making structures

and system to control their activities2. middle management which were functionally defined

departments 3. middle managers directed flow of goods and info 4. machine tools Phil had small scale industries and it was

called flexible specialization III. World of Work

a. Industrial order included wage earners and $ change affected working people

b. Labor Recruitsi. Farmscities; industrial labor force but Americans rejected

factory work b/c they didn’t have indus. Skills so instead they had white-collar jobs that required basic skills

ii. Southern Labor1. Low wage industrial sector from people trying to get the

South=to the North2. Mill wages higher than farm earnings but not by much and

had 40% lower labor costs3. No factory recruited by individuals but rather by family

(1/2 female + young) mostly whites blacks worked as janitors

4. Racially mixed southerners in Al iron industry5. Blacks=scarce opportunities b/c industrial work wasn’t

open to them 6. Immigrant Workers

a. Great migration started in 1840 and peasant economy started failing and most came to US b/c of new tech and higher $

b. Welsh=tin plate workers; English=miners; Germans=machinists; Belgians=glass; Scandinavians=seamen; Irish=labor workers

c. Low paid labor came aboutd. Hunky referred to Hungarian workers also applied

to Poles, Slovaks, slavs, etc…hunky work not for white men

e. Networks determined one’s position and business position

f. Padrone was a boss in Italy that people labored under

g. Immigrants entered mod indus order and try to find money to buy themselves prop

h. Most thought that America meant temporary but many changed their minds

i. Immigrants took worse jobs +high availabilityiii. Working Women and Fam Econom

1. Made up ¼ of the working non farm labor2. Only African americans worked outside of home and old

women worked b/c of lost husband3. Family wage was wanted to help wives stay at home4. 1/3 work as domestic serv, 1/3 work has white collar jobs,

1/3 work in industry5. Women jobs were not for men6. Pregnancy was the hardest time (1/5 of children worked

before 16)c. Autonomous Labor

i. Miners were their own autonomous craft workers and they produced at their own pace

ii. They abided by the stint which would let them have their own limit on how much they produce each day

iii. Lowell, Mass incident caused one person to think that the system was of slavery

iv. Top hatters glued fur to hats and used the terms “shopped, bagged, cried off, under teach for hired, fired, quit, learning

v. Youth was important to woman shaped their careers didn’t do so as much for men

vi. Strikes by Jewish garment workers of NY and Irish American telephone operators of Boston

vii. Women workers didn’t really have the craft power men hadviii. Aristocracy of workers enjoyed autonomy

ix. Pittsburgh foremen were known as pushers for driving their gangs very harshly

d. Systems of Controli. Mass production was a new system that lent itself to

mechanization which used machine tools to make things and made it easier to control people

1. machine tools became dedicated machines set up to do the same job over and over again

2. motive to get workers to work harderii. Frederick W. Taylor came up with scientific management

1. eliminate brain work from manual labor2. withdraw authority that workers had on the shop floor and

obey peopleiii. Time and motion study workers would be paid at the rate of his

output.iv. Essentially too expensive and workers resisted but Taylor achieved

something that inspired other people to try out knew psychology to motivate their workers

v. Textile workers loss of autonomy came earlier than miners and ironworkers

IV. Labor MVTa. Collective bargaining Americans began rejecting politics and using thisb. Reformers+Unionists

i. Thomas B. McGuire was a NY driver but realized that men like him that were ambitious were slaves in aspects of being independent American workers

ii. $ crushed people’s dreamsiii. Knights of Labor

1. wanted to produce a system that would let citizens become independent and like Jefferson’s yeoman society but not agrarian

2. they wanted to be producers and be in a cooperative commonwealth

3. Knights of Labor were like the Masons or Odd Fellows and they wanted to give voices to men who couldn’t reach their aspirations and gain labor emancipation

4. Knights became devoted through education with their leader Terence V. Powderly that made an open college to everyone except lawyers and saloonkeeprs to find more and more producers

iv. Trade Unionism1. trade union tended to everyday need2. apprenticeship had closed shop to non competent workers

and expressed craft’s social identity3. Birmingham ironworker said that a good union had good

standard of morality, temperance, and good workmanship4. International Typographical Union in 1852 which had

other 30 unions and both groups had no conflicts yet5. trade unions barred women and so did knights until 1881

where they struck and won and 50 grand women belonged to knights

6. women like Leonora M. Barry had rare opportunities for women and Powderly said that women are the best man in the Order

c. AFL Emergesi. Knights had a strike against Jay Gould’s SW railway system in

1885 (100 grand to 700 grand)ii. Sam Gompers + Pure and Simple Unionism

1. Sam Gompers was into craft trades and was in the Cigar Making Union and he made the pure and simple unionism

a. Pure: strictly for workers by craft/occupation and no middle class reformers

b. Simple: goals that only benefit worers

2. AFL was founded American Fed of Labor with Gompers as president

iii. Haymarket1. arguing over 8 hour day strike and Chicago had

McCormick reaper and there was the battle2. anarchism- stateless society and most local anarchist were

German called a protest at Haymarket Square and some people shot the police (4 executions 1 suicide)

3. yellow dog contract workers pledged not to join labor organizations

4. AFL didn’t welcome women and blacks and those were admitted to a separate, second class area

d. Industrial Wari. Homestead Strike

1. all the skilled workers in Homestead, Penn thought they were safe from threat and Carnegie wanted to get better machinery but fled and left everything to the command of Frick

2. company no longer dealt with Iron and Steel Workers from Amalgamated Asspcoatopm

3. armed guards hired by Pinkerton and then they surrendered because they were pummled by women in Homestead as they retreated to railway station

4. this marked the end of trade unions and ended any illusions about sanctity of worker’s community

ii. Great Pullman Boycott1. Pullman was a railroad man for the ARU American railway

union but he wanted to raise rent rate without wage rate so people pulled a secondary labor boycott forcing second party railroards to bring pressure on primary target Pullman

2. theyhooked u.s. mail cars to every Pullman car and then railroades appealed to pres cleaveland to protect u.s. mail

3. Olney sided with former employers and Debs and his associates were jailed

4. it failed b/c it was crushed by naked use of gov power e. American Radicalism in the Making

i. Eugene V. Debs and American Socialism1. Debs was treasurer of the Brotherhood of Locomotive

Firemen 2. devoted himself to ARU and industrial union union open

to all railroad workers3. was a populist but changed to Marxist4. Marxism struck with German Americans and in the

Socialist Labor Party in 1877 it became permanent

5. Daniel De Leon party head who thought ideological purity is more important than winning elections and De Leon launched rival Socialist Party of America in 1901

6. socialism had a powerful appeal and had a bunch of networks

f. Western Radicalismi. Western fed of miners less silver copper price made pressure to cut

miners’ wageii. Coeur d’Alene had striking miners in Idaho engaged in gun

battles and they were imprisonediii. Ed Boyce called all union members to arm themselves and said the

wage system suckediv. Big Bill Haywood and Boyce joined left wing Socialist to creat

Industrial Workers of the Worldv. Wobblies supported Marxist class struggle but at workplace

vi. General strike would bring a revolution and a new society would emerge and syndicalism describes this brand of workers’ radicalism

Count Vay de Vaya and Luskod Pittsburg Inferno travel to way to asiaKilling floor: site of America’s mass production revolution Working women wives in the millKnights of st. crispin for shoes and draughts of st. crispin

UNIT FIVE: Terms and Concepts

Chapter 17 Definition

“The Great Deflation”Late 19th century=Great Deflation not enough demand for goods prevalent in England

“Bessemer Converter”Bessemer made the furnace which was called the Bessemer converter that made raw pig iron into steel

“Andrew Carnegie” began working for Penn Railroad and then became his own iron manufacturer had Bessemer converter as centerpiece and had 3 steps:1)blast furnaces smelt ore into pig iron2)pig iron refined into metal that can be used(iron/steel)

3)refined metal is sold

“Limited Liability”corporation let priv capital be raised and investors had limited liability meaning that they only risked money they themselves had invested

“Gustavus F. Swift”Swift saw that livestock lost weight to the East and that slaughterhouses lacked scale to use waste by products so he wanted to make beef so that it could be processed in bulk at Chicago stockyards

“Oligopoly”oligopoly means market dominance by the few which made small slaughterhouses and livestock dealers disappear

“John D. Rockefeller”1850 figured out how to extract kerosene Titusville, Penn Drake drilled and struck oil and makeshift refineries sprung around Titusville

“Hunky”Hunky referred to Hungarian workers also applied to Poles, Slovaks, slavs, etc…hunky work not for white men

“Knights of St. Crispin”Am. Lab. Union in NE

“Breaker Boys”Sep impurities in coal mine

“Scientific Management”

Engineer’s approach applied to workers scientific management brain work must be eliminated from manual work and workers have no authority

“Collective Bargaining”Collective bargaining Americans began rejecting politics and using this

“The Knights of Labor”Jefferson’s yeoman society but didn’t want farm past but wanted producing future

“Closed Shop”Apprenticeship through closed shop for joys for union members

“Samuel Gompers”Sam Gompers +Unionism which was the Am. Fed. Of Labor

“American Federation of Labor”

Organization of labor that came about in the United States

Condition of employment where workers don’t join labor

“Yellow-Dog Contracts” org.

“Homestead Strike”Indus. Lockout betw. Strikers+agents

“The Pullman Strike”Labor union v railroad strikes

“Eugene V. Debs”Union leader that led strikes

“Socialist Labor Party”Oldest pol party that led unions

“Industrial Workers of the World”

Int union of workers of 300 grand