Chapter 17

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Chapter 17: Industrial Supremacy

In this Chapter:

Identify the factors that drove America’s industrial expansion in the late nineteenth and early twentieth centuries (ch. 17)

Explain the conditions and characteristics of workforce change during the period of rapid industrialization (ch. 17)

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Sources of Industrial Growth

Many factors contributed to the growth such as:

abundant raw materials

a large and growing labor supply

a surge in technological innovation

the emergence of a talented and ruthless group of entrepreneurs

a federal government eager to assist the growth of business

expanding domestic market for the products of manufacturing

Industrial Technologies

Rapid emergence of new technologies

new materials

new productive processes

advances in communications

transatlantic telegraph cable

Cyrus W. Field

1866

First telephone with commercial capacity

Alexander Graham Bell

early development of radio (first steps)

Guglielmo Marconi

1890s

Other Advances

typewriter

Christopher L. Sholes

1868

cash register

James Ritty

1879

Electricity as Light and Power

Arc Lamp for street lights

Charles F. Brush

light bulb (incandescent lamp)

Thomas Edison

improved generators and large power plants

powered whole cities

electricity soon became commonplace for:

street railway systems

elevators in urban skyscrapers

factories

and increasingly in offices and homes

high-efficiency steam engines

larger & faster ships

new high-speed freighters

refrigerated ships (1870's)

meat transportation

Iron and Steel Production

Production soared in the 1870s and 1880s to provide metal for 40,000 miles of new railroad track

eventual dominance in metal industry

Henry Bessemer & William Kelly

separately developed a process for converting iron into steel: The Bessemer process

blowing air through molten iron to burn out impurities

could add other ingredients

Abram S. Hewitt

Open Hearth Process

allowed steel production in massive quanties

intimate relationship between railroad and steel industries

need for lubrication of machines created the oil industry

The Automobile

Preceded by two inventions:

Gasoline

lubricating oil and fuel oil removed separately from crude oil

Self contained engine

Nicolaus August Otto

four-stroke gasoline engine that was not portable

Gottfried Daimler

One of Ottos former employees

later perfected the engine that is used in automobiles

Charles and Frank Duryea

first gasoline motor vehicle

1893

Henry Ford

1896: First Ford Car

In 1895 there were only 4 cars are American Highways, by 1917 there were over 5 million

The Airplane

The Wright Brothers

started construction of a

self propelled glider in 1899

120 feet in 12 seconds

by 1904 that was improved to 23 miles

Charles Lindbergh

1920s

Flew from New York to Paris

Research and Development

Many businesses built their own research operations

rise in corporate R&D as a result in decline of government R&D

decentralized the research

the government no longer controlled the paths of what was researched

The Science of Production

Taylorism

"scientific management"

Frederick Winslow Taylor

subdividing tasks

sped of production

made workers interchangeable

diminished managers dependence on any particular employee

Assembly Line

Moving Assembly Line

Henry Ford

1914

complete interchangeability of parts

raised wages and cut hours while decreasing cost of production

Railroad Expansion and the Corporation

Government Subsidies

30,000 miles in 1860 to 193,000 miles in 1900

subsidies from federal, state and local governments

foreign loans and investments

Railroad Tycoons

Cornelius Vanderbilt

James J. Hill

Collis P. Huntington

Businesses could raise money selling stocks

limited liability

The modern corporation

entrepreneurs could raise capital with manageable financial risk

Carnegie, Frick, and Morgan

Andrew Carnegie

dominated steel industry

funded business ventures with profits and the sale of stock

sold to J. Pierpont Morgan for $450 million

merged with others to form United States Steel Corporation

Horizontal integration - A corporate combination where a group of businesses that do the same thing are consolidated

Vertical Integration - The arrangement by which a company takes ownership of businesses in various stages of production and distribution within the same industry

Rockefeller's Standard Oil

John D. Rockefeller

Standard Oil Company

started eliminating competition

acquired 20 of the 25 refineries in Clevland, Ohio

Vertical Integration

barrel factories

terminal warehouses

pipelines

freight cars

marketing

symbol of monopoly

Trusts

stockholders in individual corporations transferred their stocks to a small group of trustees in exchange for shares in the trust itself

just received a share of profits without control

trustees might only own a few companies but have control over many

Holding Companies

made trusts unnecessary

a company that buys the shares of other companies to establish direct and formal ownership

Concentration of Power

1% of corporations controlled 33% of manufacturing by 1900

put lots of economic and political power into the hands of few men

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Capitalist Conservatism and its Critics

Survival of the Fittest

Ideology of Individualism

wealthy capitalists defended their wealth as a product of their own hard work

failure is a result of ignorance stupidity or laziness

competition and free market

Social Darwinism

Herbert Spencer

Principles of Biology (1864)

status and wealth is a result of who is the most "fit" for the top

those who fail were unfit for success

The Gospel of Wealth

the wealth was not only a power but a responsibility

Andrew Carnegie wrote that people of wealth should consider all revenues in excess of their own needs to be "trust funds" used for the good of the community

Horatio Alger

wrote novels about rags to riches

Alternative Visions

challenging corporate ethos and at times even capitalism

Dynamic Sociology (1883)

Lester Frank Ward

not natural selection but rather human intelligence

active government engaged in positive planning was the best approach

American Socialist Party

more radical approach to reform

Henry George

radical

Progress and Poverty (1879)

the ability of monopolies is a result of rising land values

proposed a "single tax" on land

argued it would end monopolies and eliminate poverty

Edward Bellamy

Looking Backward (1888)

utopian novel

The Problems of Monopoly

most people were for capitalism but concerned about monopoly

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The Ordeal of the Worker

The Immigrant Workforce

massive migration into industrial cities

rural Americans continued to flow into factory towns and cities

25 million international immigrants between 1865 and 1915

escape poverty and oppression in their homelands

attracted by expectations of new opportunities

Labor Contract Law

allowed industrial employers to recruit overseas and pay for workers expenses to come to America

the cost of travel was then later subtracted from their wages

Wages and Working Conditions

Average income was $400 - $500 per year

$600 was considered the level of reasonable comfort

Industrial Jobs

poor job security as well due to the industrial nature

frequent accidents

decrease in need of skilled workers which led to the hiring of women and children

Child Labor

1.7 million children workers under 16

38 states passed laws but most were ineffective

Emerging Unionization

Molly Maguires

militant labor organization

Irish Secret Society

Used violence and murder to battle Coal Operators

Railroad Strike of 1877

Americas first major national labor conflict

followed a 10% wage cut

disrupted services, damaged equipment, rioted

100 deaths before the strike collapsed

The Knights of Labor

1869

excluded bankers, lawyers, liquor dealers and professional gamblers

promoted 8 hour workday and abolishment of child labor

diminished after failing to accomplish anything

The American Federation of Labor

represented mainly skilled workers

concentrated on immediate objectives

wages

hours

working conditions

demanded 8 hour workday and a strike if demands were not met

The Homestead Strike

Amalgamated Association of Iron and Steel Workers

represented the last factory still employing skilled workers in the steel industry

not enough influence to organize successful strike

wages fell enough where they called a strike

Carnegie shut down the plant to hire non-union workers

sent 300 guards

13 deaths

government sent 10,000 national guard troops at the companies request

The Pullman Strike

cut wages without lowering worker's rent

transportation from Chicago to the Pacific Coast shut down

strike ended with imprisonment of union leaders and the sending of 2,000 federal troops

Sources of Labor Weakness

Contract Labor Law abolished

8 hour government work day

compensation for workers injured on the job

these things were not often enforced