Chapter 24Industry Comes of Age (The Gilded Age Part II)

Th

e Railroad

• Built with government subsidies and land grants

• Frontier outposts became flourishing cities (if they were lucky)

• 1869: The Transcontinental Railroad links east and west– The “golden spike” is hammered in at

Promontory Point, Utah

• Steel provided the rails and bridges• Airbrakes made travel safer

Revolu

tionary R

ailroads

• Physical unification of our country• The nation’s first “big business”

– 20% of US investment $– More employees than any other– Who wants to be a millionaire??

• Raw materials factories Finished goods consumers

• Farm products from the West population centers in the East

• Railroads changed time itself!

Golden

versus G

ilded

• Stock watering inflated the RRs values artificially

• Bribes/Kickbacks to politicians and judges

• Rates were not made public• The reality: RR owners controlled

American life– Politically, socially and economically ($)– Especially true of the farmers who were

treated unfairly– Remember…this is where we saw the

rise of Populism

Clean

ing U

p Th

is G

ilded Age

• Wabash v. Illinois (1886) ruled that it was the federal government’s job to regulate interstate commerce– Illinois was trying to regulate railroad

rates within their state

• The I.C.C. (1887) set the precedent that the government was bound to protect the public interest– Our nation’s first true

regulatory agency

Mech

anization

and

Inn

ovation

• Investment + abundant nat. res. + the size of the American market + transportation networks + cheap, plentiful labor + innovators and inventors (the Rockefellers, the Carnegies, the Edisons and the Bells) = SUCCESS!

• By 1894, the US was the world’s manufacturing leader

In T

rusts W

e DO

N’T

T

rust

• Large business combinations (trusts) make millions while reducing competition– w/ the Pendleton Act taking the

incentive out of political contributions, politicians turn to big business

• Horizontal Integration– J.D. Rockefeller & Standard Oil– A monopoly

• Vertical Integration– A. Carnegie & Carnegie Steel– NOT a monopoly

• Horizontal Integration occurs when a business expands its control over other similar or closely related businesses.– By 1890, Standard Oil controlled

over 90% of the refined oil in the U.S.

• Vertical Integration occurs when a business expands its control over other business that are part of its overall manufacturing process.

Wh

at did he do??

• Temporarily undercutting the prices of competitors until they either went out of business or sold out to Standard Oil.

• Buying up the components needed to make oil barrels in order to prevent competitors from getting their oil to customers

• Using secret rebates from the RR to reduce shipping costs to a level far below the rates charged to competitors.

• Secretly buying up competitors and then having officials from those companies spy on and give advance warning of deals being planned by other competitors.

…or a “C

aptain of

Indu

stry?”

• John D. Rockefeller:

"The American Beauty rose can be produced in all its splendor

only by sacrificing the early buds that grow up around

it."

Gilded A

ge Ph

ilosophies

• Herbert Spencer and others were often labeled as “social Darwinists”– Individuals “won” their station in

life based on competition and their natural talents (Darwin…Get it?)

– This could also be applied to entire nations in order to justify dominating “lesser peoples”

• Self-justification of one’s wealth led to contempt for the poor

Gilded A

ge Ph

ilosophies

• Some Gilded Age capitalists did believe they had a duty to give back to the society that gave them their $

• This was known as the “Gospel of Wealth”– Andrew Carnegie famously said, “He

who dies rich, dies disgraced”– By his death in 1919, he had given away

over $350 million and provided more than 2,500 free public libraries throughout the world (J.D.R. will give away $500 million)

Th

e Dru

mbeat of

Discon

tent

• An epidemic of strikes raised the prospects ofan industrial workers and farmer alliance with the Populists

• Haymarket Square (1886)– 7 police killed and 60 wounded

when a pipe bomb explodes

• Homestead (1892) – 10 people were killed, 60 wounded

when violence between Pinkertons and striking workers broke out in Pittsburgh

Sh

erman

An

ti-Tru

st Act

(1890)

• The first federal anti-trust law

• Authorized federal action against any “combination in restraint of trade”

…an

d in th

e Sou

th??

• James B. Duke revitalizes the tobacco industry w/ machine-rolled cigarettes

• North vs. South (Really? Again?)– N. manufactured goods were given

preferential treatment by the RR– RR encouraged the use of S. raw

materials– “Pittsburgh Pricing” to keep S. steel

from heading N.

• Keeping labor cheap kept S. workers in poverty

Th

e Worsen

ing

Con

dition of L

abor

• Frederick Taylor published the Principles of Scientific Management– Unskilled workers become “part

of the machine”

• The skilled worker could be replaced– The craftsmen of old no longer

controls his destiny

•Working conditions proved less than ideal

• Small, crowded rooms• Specialization led to boredom,

monotony and injury• Stale air and unsafe machinery• Long hours, low wages, no job

security

Labor U

nion

s

• Knights of Labor• 1st national union• Skilled & unskilled• T. Powderly

becomes the leader in 1879 and ends the secrecy of the organization

• American Federation of Labor

• Organization of individual unions into one

• Only skilled• Collective

bargaining• Samuel Gompers

was their most significant leader

Th

e Impact of th

e In

dustrial R

evolution

• “Jeffersonian ideals were withering…”

• Rural Americans and European immigrants were headed for the factories

• A new “ideal woman” (the Gibson Girl) enters the workplace for secretarial/clerical work

• Gap between the rich & poor grows• Dependent workers• Clamor for international trade

Chapter 25America Moves to the City

Th

e Urban

Fron

tier

• Characteristics of cities at the turn of the century

• How cities were “monuments of contradictions”

Th

e New

Imm

igrants

• Where from?• Social/Economic

characteristics• Pushes and Pulls• How they were

welcomed (or not)• How obstacles were

overcome

Wom

en, B

lacks and W

hites

• Meanwhile, the NAWSA foughtfor suffrage forwomen…but only white women

• Ida B. Wells helps launch the National Assoc. of Colored Women fighting for equality as well as anti-lynching laws

• Booker T. Washington took an “accomodationist” approach

• Go to technical school (like Tuskegee Institute) and learn a trade

• In 1895 at the Atlanta Exposition he said:– “In all things purely social we

can be as separate as the fingers, yet one as the hand in all things essential to mutual progress” (remember Plessy v. Ferguson?)

• W.E.B. DuBois spoke of the “Talented Tenth” in 1903– “Negroes must first of all

deal with the Talented Tenth; it is the problem of developing the best of this race that they may guide the mass away from the contamination and death of the worst”

• Go to college. Lead.• Considered the “Atlanta

Compromise” propaganda

Divergen

t Path

s to E

quality for A

frican-

Am

ericans

1818 Frederick Douglass 1895

1856 Booker T. Washington1915

1868 W.E.B DuBois 1963

1925 Malcolm X 1965

1929 M.L.K. 1968