The Triumph of Industry1865-1914

New York City, 1860s

Key Terms and People

EntrepreneurProtective TariffLaissez fairePatentThomas EdisonBessemer processSuspension bridgeTime zoneMass production

Essential Question:

How did industrialization and new technology affect the economy and society?

First Industrial Revolution

Began in Britain during 1700s - Textile Industry

Key Components:Steam EngineFactory System

Key Resources:IronCoal Diagram of Watt’s Steam

Engine, 1755

Second Industrial Revolution

Began around 1850s

Dominated by steel, oil and electricity

Bessemer Furnace, Kelham Island Museum, Sheffield England

Think About It…

• What sorts of items were necessary during the Civil War?

• How did the Civil War encourage industry?

America’s Natural Resources

Vast resource supply helped fuel growthCoal mines along east coast

Thick forests cut down for lumber

First oil well drilled in 1859

Strip Coal Mine, Sullivan County, PA

Immigration in the U.S.

Post Civil War – large influx of Europeans and Asians due to:Political unrestReligious discriminationCrop failures

1881 – 750,000 immigrants 1905 – more than 1,000,000 per year

What impact might this have had on industry?

Street Life in New York

Published in 1868 by Horatio Alger

Told the story of a poor boy who rose to wealth and fame by working hard

From “rags to riches” story

Horatio Alger, 1832-1899

What is Capitalism?

Free enterprise; individuals own most businesses

Entrepreneurs – people who invest money in a business or product in order to make a profit.Can you think of any other

economic systems?

Government Policies

Gave railroad builders large pieces of land in order to link East and West coasts.

Protective Tariffs – taxes that made imported goods cost more.

Laissez-faire – allowed businesses to operate under minimal government regulation.

Think About It…

• What factors spurred industrial growth in the late 1800s?

Innovation Drives the Nation

Patent – grant by the federal government giving the inventor the exclusive right to develop, use, and sell an invention for a set period of time

Original Microwave Oven PatentDr. Percy Spencer, 1950

Major Inventions of the 1800s

1844 – Telegraph1846 – Sewing Machine

1852 – Safety Elevator

1880 – Light Bulb1884 – Steam Boiler Furnace

Thomas Edison

The Bessemer Process

Steel – Henry Bessemer, a British engineer, developed a process for purifying iron, which resulted in a strong, lightweight steel.

What impact do you think this had on society? What is steel currently

used for?Drawing of Henry Bessemer, Vanity Fair, 1880

Technology and Transportation

1883 – Three transcontinental railroad lines in the U.S.

1884 – Delegates from 27 countries decided to divide the world into 24 time zones, one for each hour of the day

During most of the 1800s towns set their clocks independently. By 1883, why did this become a problem?

The Railroad Effect

Trains transported large amounts of goods, cheaply, quickly and efficiently

Allowed business to obtain raw materials easily, and opened up new markets to sell goods

What is mass production?

Why did this occur?

Railroad Steam Engine, late 1800s

Think About It…

How did new technologies shape industrialization?

Impact of Industrialization

Globalization Linked world markets; American economy expanded As United States grew into a world power, it often conflicted with

political views and political policies of other countries.

American Society Farms became mechanized=fewer workers, joblessness=influx of

workers to cities Greater access to goods and products; no longer made items by

hand Increased cost of living, depended on cash wages

Environment Late 1800s – industrial waste is rapidly rising = Midwest; soil

erosion and dust storms Congress’ response – National Park Service; Yellowstone, 1872

Question for Reflection

What impact did industrialization have on Americans?

The Rise of Big Business

Key Terms and People: Corporation Monopoly Cartel John D. Rockefeller Horizontal integration Trust Andrew Carnegie Vertical integration Social Darwinism Interstate Commerce

Commission Sherman Antitrust Act

Essential Question:

How did big business shape the American economy in the late 1800s and early 1900s?

Think About It…

Before the Industrial

Revolution businesses were

not very large. How did the IR change this?

Corporations

Corporation – A business in which a number of people share in the ownership

Advantages –Greater access to

resourcesShare cost of ownershipHas the same rights as

individuals (buy and sell land, sue in court, etc.)

The Competitive Edge

Wide-spread advertisingJP Morgan – investing in

researchMonopoly – corporation

that has complete control of a product

Cartel – group of corporations that band together in order to eliminate competition from other businesses

J.P. Morgan John D. Rockefeller

Henry Flagler Andrew Carnegie

Horizontal and Vertical Integration

Horizontal Integration – creating a giant company with low production costs by consolidating many firms into one companyEx. Rockefeller – Standard Oil Company

Vertical Integration – consolidating many different businesses involved with the development of a specific productEx. Rockefeller and Carnegie

What is a Trust?

Ohio law prevented one company from owning stock in another, thus preventing horizontal integration.

Rockefeller’s lawyer created the TRUST to get around this law.

Trust – companies assign their stock to a board of trustees, who combine them into a new organization. The trustees run the organization, and then pay themselves dividends on the profits.

Think About It…

What strategies did corporations use to decrease costs and increase profits?

Robber Barons or Captains of Industry?

Provided jobs for millions of workers

Technological development

Economy boomed

CAPTAINS OF INDUSTRY!

Small businesses squeezed out of business

Cartels often set unfairly high prices

ROBBER BARON!

Social Darwinism

Charles Darwin, On the Origin of Species (1859); animals evolved based on the process of natural selection – “Only the strong survive”

This theory was soon applied to American capitalism. What do you think were the results of this?

Social Darwinism

Wealth was a measure of one’s inherent value; those who had it were most ‘fit’

Laissez-faire: Government should stay out of the business world. This process of “natural selection” would make the country grow rich and strong.

Many used this theory to validate racist beliefs and values. Cited poverty-stricken condition as evidence of the inferiority of minorities!

Government Regulations Interstate Commerce Commission (1887)

Oversaw railroad industry to fight price-fixing and pooling First government agency to regulate business, but was

weak: Could only monitor railroads that crossed state lines Could not make laws or control railroads transactions Could force railroad industry to submit records to Congress

Government RegulationsSherman Antitrust Act (1890)

Outlawed any trust that operated “in restraint of trade or commerce among the several states.”

Was rarely enforced but started a trend of government oversight and regulation

Sen. John Sherman