EOC Chapter 5 Notes - Industrialization and the Gilded Age PDF

EOC Chapter 5 Notes Industrialization and the “Gilded Age” Chapter 5 Overview ❖ Section 1: America Industrializes American industrialization proceeded at a rapid pace after the Civil War. ❖ Section 2: Entrepreneurship Entrepreneurs began to ex...

EOC Chapter 5 Notes Industrialization and the “Gilded Age” Chapter 5 Overview ❖ Section 1: America Industrializes American industrialization proceeded at a rapid pace after the Civil War. ❖ Section 2: Entrepreneurship Entrepreneurs began to exercise a dominant influence on American economic life. ❖ Section 3: The Conditions of Labor One factor behind America's astonishing growth was the exploitation of its industrial workers. Bessemer Process ❖ Iron replaced wood, and steel iron ❖ Production techniques improved steel ❖ Production cost were more economical Technological Innovations ❖ Bessemer process - Increased the amount and the quality of steel being produced. ❖ This new steel was used to lay more miles of railroad tracks, to build the world’s first skyscrapers, and to make better machinery. Building the Transcontinental Railroad ❖ Civil War vets, Irish laborers, and free blacks started working westward from Omaha. ❖ Chinese workers started eastward from Sacramento. ❖ They met at promontory point, Utah. ❖ Railroads would have a significant impact on the economic, cultural, and social development of the Western United. The Growth of Railroads ❖ Transcontinental connected at Promontory Point, Utah. ❖ Reduced travel and shipping time from several months to a few weeks ❖ National market emerges benefiting consumers and national producers Development of a National Market ❖ Railroad, canals, telegraphs and telephones linked the country together. ❖ Shipping raw materials and finished goods became less expensive to be shipped across the U.S. ❖ New methods of selling - department stores, chain stores, and mail-order houses. (Ex. Sears) The Impact of Population ❖ Continuous population growth in the 19th century ❖ Between 1850 - 1900, US population grew 3x due to birthrates and immigration ❖ Experienced steady demand for goods and plenty of cheap labor to make goods Emergence of a Modern Economy Cause Effect Expansion of railroads (Transcontinental Improved trade routes and decreased travel time Railroad) Growth of population Provided industries with a labor force and market Technological progress (new inventions) Improved the standard of living Big Business Large businesses are more efficient which leads Unfair competitive advantage. to lower prices. Hire large numbers of workers. Often exploits workers. Produced goods in large quantities. Often unconcerned about pollution they may cause. Have the resources for expensive research and to Have an unfair influence on government rules invent new items. that affect them. The Free Enterprise System ❖ Corporation is a company owned individuals or a group ❖ Americans are free to buy and sell ❖ Business produce, sell goods and services in hope of making profit ❖ Government law passes laws to protect business (tariffs) What is an Entrepreneur? ❖ Entrepreneur starts a business for profit ❖ “Gilded Age” entrepreneurs known as “Captains of Industry” and “Robber Barons” ❖ Andrew Carnegie - Carnegie Steel and was a philanthropist ❖ John D. Rockefeller - Standard Oil (monopoly) Vertical and Horizontal Integration ❖ Horizontal Integration - companies producing similar ❖ Products merge (Rockfeller pioneered) Ex: Walt Disney Co. acquiring 21st Century Fox ❖ Vertical integration - a process in which Carnegie brought out his suppliers - coalfields and iron mines, ore freighters, and railroads lines - in order to control the raw materials and transportation system Ex: MGM, Paramount Pictures used to own movie theaters Taming the Industrial Juggernauts ❖ Economy worked best when it was not burned by government regulations (Laissez-faire) ❖ Government leaders doubted the constitution gave them the right to regulate business Laws Against Anti-Competitive Practice ❖ Laissez-faire - government should not interfere in the free market (“hands off”) ❖ Interstate commerce Act (1887) - 1st law, prohibited unfair practices by railroads ❖ Sherman Anti-Trust Act (1890) - law that monopolies from engaging in unfair business practices Trusts and Holding Companies ❖ Trust - a legal arrangement allows one person to manage another person;s property, persin managing assets us a trustee  ❖ Purpose was to reduce market competition and to control the industry and fix prices and employee wages to the company’s benefit ❖ Holding Company - trust or corporation that buys stocks or owns businesses in other industries Ex: oil refinery owns a railroad Political Cartoons on Robber Barons Robber Barons were accused of ❖ Unfair business practices ❖ Being above the law ❖ Abusing labor with low wages and long hours ❖ Having too much influence on government ❖ Simply not caring about the American public ❖ And being just plain greedy Social Darwinism ❖ Charles Darwin’s theory of biological evolution = some individual of a species flourished and pass their traits along to the next generation while others do not ❖ Success and failure in business were governed by natural law; no one had the right to intervene ❖ $ was a sign of God’s favor, poor must be lazy or inferior (lesser) who deserved to be where they are The Gospel of Wealth: Carnegie’s Response to Critics “The problem of our age is the proper administration of wealth, In bestwing charity, the main consideration should be to help those who will help themselve; to provide that means by which those desire to improve may do so; to give those who desire to rise the aids by which they may rise; Neither the individual nor the race is improved by charity. Those worthy of assistance… seldom required assistance… More injury is done by rewarding vice than by revealing virtue. The best means of benefiting the community is to place within its reach the ladders on which the aspiring can rise…” Social Gospel Movement ❖ Christian duty to help solve social problems, such as alcoholism, child labor, poverty and prostitution. ❖ Urged Protestant churches to work for social justice  ❖ Heavily influenced the Progressive Movement Summary of Industrial Revolution ❖ Corruption by government officials and dirty business tactics allowed the industrial (entrepreneurs) to gain political power ❖ Federal Government supported big business through laissez-faire policies ❖ Corruption and Monopolies formed by the Industrial Revolution prompted (pushed) the federal government to get more involved in business and to regulate it ❖ Main purpose if Anti-legislation (Interstate Commerce and Sherman Antitrust) was to protect the economy by encouraging competition between private business Problems in the Workplace ❖ Long hours and low wages ❖ Poor conditions, boring and repetitive tasks ❖ Child labor ❖ Lack of security The Conditions of Labor ❖ Workday: 10-14 hours ❖ Work week: 6 days ❖ Average Pay: $3 - $12 per week ❖ Immigrants often worked for less money ❖ Women and children were paid less than adult men ❖ Jobs were on a “Take it or Leave” basis ❖ ‘Sweatshops” - workshops in tenements (apartment housing) Triangle Shirtwaist Factory Fire ❖ March 25, 1911 was the deadliest industrial disaster in the history of New York City until 9/11 ❖ 146 workers died from fire smoke inhalation, or falling or jumping to their deaths from 8th, 9th, and 10th floors ❖ Most were women aged 14 to 23 Child Labor ❖ 1910 - 20% of American children under the age of 15 worked ❖ Kids moved, cleaned, or fixed large machines since they fit in between and under the machinery ❖ Neglectic dangerous, and often fatal working conditions, longer hours, and less pay than adults The Rise of Unions ❖ Unions organized strikes to demand better working conditions ❖ Knights of Labor (skilled and unskilled workers) ❖ American Federation of Labor (AFL) founder Sammuel Gompers wanted a closed shop (places where only union members could be hired) ❖ Goals of Unions: higher pay, 8hr work day, better conditions Government’s Attitude Towards Unions ❖ Most government leaders favored big business over unions ❖ Government officials saw workers as greedy ❖ Government leaders used troops to put down strikes and restore order ❖ Haymarket Affair of 1886, labor leaders blamed for a strike becoming violent Americans’ Thoughts on Union Public Opinion Haymarket Affair Business leaders contributed heavily to political Feared wage increases would lead to higher prices campaign funds Between 1880 - 1900 more than 20,000 strikes Union activist often ended in violence involving more than 6 million 1895 - SCOTUS applied the Sherman Antitrust A labor protest rally near Chicago’s Haymarket Act against unions due to restraint on trade, Square turned into a riot after someone threw a allowing for feral troops to stop strikes. bomb at police. Public opinion supported laissez-faire policies. Seven police died, despite a lack of evidence, eight radical labor activists were convicted. America believed business should hire and fire Riot was considered a setback for organized employees as they saw fit labor movements in America.