Big business during industrialization.

1. Rise of Big Business 1860-1900

2. A shift in focus….
 American Cultures I:
 America focuses internally on itself
 American Cultures II:
 America focuses internally and to
the outside world.

3. How and Why does this happen
 From 1860-1900 the US becomes an
economic super power.
 Vast raw materials (coal, iron, oil)
 Booming population (immigration)
 Pro-business government
 American ingenuity

4. Share of World Manufacturing Output
1750 1800 1860 1900 1928 1938
Great Britain 1.9 4.3 19.9 18.5 9.9 10.7
United States 0.1 0.8 7.2 23.6 39.3 31.4
Germany 2.9 3.5 4.9 13.2 11.6 12.7
Russia 5.0 5.6 7.0 8.8 5.3 9.0

5. American ingenuity
 1860-1890 Explosion of American genius
 1860-1890 - 500,000 patents
 1790-1860 – only 36,000 patents
 Patents – federal licenses to make, use or sell an
invention
 American productivity booms
 Productivity – amount of goods and services created in a
given period of time.
 Fewer people can do more work.
 Gross Domestic Product – total value of good and
services produced by a nation.

6. GDP of the earth in millions
World 54,347,038
1 United States 13,811,200
— Eurozone 12,179,250
a
2 Japan 4,376,705
3 Germany 3,297,233
4 China (PRC) 3,280,053
5 United Kingdom 2,727,806
6 France 2,562,288
b
7 Italy 2,107,481
8 Spain 1,429,226
9 Canada 1,326,376
10 Brazil 1,314,170

7. 11 Russia 1,291,011
12 India 1,170,968
13 South Korea 969,795
14 Mexico 893,364
15 Australia 821,716
16 Netherlands 754,203
17 Turkey 657,091
18 Belgium 448,560
19 Sweden 444,443
20 Indonesia 432,817

8. 21 Poland 420,321
22 Switzerland 415,516
23 Norway 381,951
24 Saudi Arabia 381,683
25 Austria 377,028
26 Greece 360,031
27 Denmark 308,093
28 South Africa 277,581
29 Iran 270,937
30 Argentina 262,331

10. Times they are a changing!
Life in 1900
Electric lights
Refrigeration
Telephone
Cross country rail
Steel
Tractor
Skyscrapers
Life in 1865
Candle lighting
No refrigeration
Telegraph
Short line rail
Iron, wood, brick
Horse, ox
Ten story
buildings

11. How railroads changed!
 Railroads of 1865
 No standard track
width
 Unreliable brakes
 No system of signals
 Collisions frequent
 No time zones –
trains never on time
 Railroads of 1900
 Standard track
 Air-brakes
 Telegraph between
trains
 Time zones

12. The new God - Progress
 Transcontinental Railroad - 1869
 Federal government wanted to
connect east coast to west coast.
 Contracted Union Pacific and Central
Pacific railroads
 Paid
 $16,000 a mile level land ($300,000)
 $32,000 a mile for foothills ($600,000)
 $48,000 per mile for mountains. ($900,000)

14.  Built mostly by Chinese
laborers
 Prior took six months to travel
to California.
 Now a week.
 Promontory Point, Utah
1869 - Golden spike ceremony
– first mass media event –
telegraph.

15. Chinese Trans movie!

16. Chinese Trans movie

17. Manifest Destiny Railroads

18. Age of Invention
 Alexander Graham Bell–
1876 invented the
telephone.
 In 1887 - 21 customers.
 By 1900 -1.5 million
customers
I’d like two small
mediums with
large pepperoni
please..
Check out our
matching
mustachios!
Watson…come
here I need you!

19. Invention When Where Notes
Safety Lift 1852 USA by Elisha Otis - also called an elavator
Airship 1852 France by Henri Giffard
Pasteurization 1856 France by Louis Pasteur
Internal Combustion Engine 1859 Belgium by Jean-Joseph-Étienne Lenoir
Bicycle 1861 France by Pierre Michaux
Plastic 1862 England by Alexander Parkes
Yale Lock 1865 USA by Linus Yale - also called cylinder locks
Dynamite 1866 Sweden by Alfred Nobel
Typewriter 1867 USA by Christopher Latham Sholes
Traffic Lights 1868 England by J P Knight in London
Air Brake 1868 USA by George Westinghouse
Telephone 1876 USA by Alexander Bell from Scotland
Four Stroke Engine 1876 Germany by Nikolaus August Otto
Carpet Sweeper 1876 USA by Melville Bissell
Phonograph 1877 USA by Thomas Edison - cylindrical
Moving Pictures 1877 USA by Eadweard Muybridge from England
Light Bulb 1879
England
USA
by Joseph Swan and Thomas Edison
Metal Detector 1881 USA by Alexander Bell
Steam Turbine 1884 England by Charles A Parsons
Cash Register 1884 USA by James Ritty
Motor Car 1885 Germany by Karl Benz - also called an automobile
Motorcycle 1885 Germany by Gotlieb Daimler
Transformer 1885 USA by William Stanley - changes voltage
Coca Cola 1886 USA by John Pemberton
Contact Lenses 1887 Germany by F E Muller
Drinking Straws 1888 USA by Marvin Stone
Jukebox 1890 USA in San Fransisco
Tractor 1892 USA by John Froehlich
Shredded Wheat 1892 USA first breakfast cerial
Radio 1895
England
Russia
by G Marconi (of Italy) and A S Popov
Safety Razor 1895 USA by King Camp Gillette
Diesel Engine 1897 Germany by Rudolf Diesel - used for heavy vehicles
Oscilliscope -TV 1897 Germany by Karl Braun - ancestor of the television
Paper Clip 1899 Norway by Johan Vaaler

20. Thomas Edison
*Motion picture studio – first movie
cameras
• Edison effect – electrons transmit
through the air. Radio, TV, modern
electronics
• Rubber – goldenrod
• Electric battery - duracell

21. The Wizard of Menlo Park

22. Annie Oakley on film

23. Improvements in Building Materials
 Bessemer process –
Henry Bessemer. Easier,
cheaper remove impurities
of iron.
 mass production of steel
now possible. Lighter,
more flexible than iron.
 Age of Steel

24. Age of Steel

25. Age of Steel
 Brooklyn Bridge – designed by
German immigrants John &
Washington Roebling.
 Steel cabled suspension bridge.
 Longest in world at time in 1883.
 Age of skyscrapers

26. Building the bridge 3 minutes

27. Skyscrapers 7 minutes

28. The Industrial Titans
Robber Barons or Captains of
Industry

29. Is this a good thing?

32. America land of opportunity!
 Age of Invention sparks business genius
which will make the US an industrial giant.
 Entrepreneurs will thrive in American free
markets. Some acquire obscene fortunes.
 Capitalism – economic system of private control of
production and consumption.
 Laissez-faire –governmental non-interference with
trade and business. (free markets)

33. Robber Baron or Captains of Industry?
 Were massive fortunes by individuals
good or bad for society?
 Were they…Captains of Industry –
personal fortunes contribute to the
greater good!
 Factories, jobs, philanthropy, overall
benevolence.
 Social Darwinism – rich are more “fit.”
I am Captain Industry
Notice huge wedgie

34. Robber Baron or Captains of Industry?
 Or were they…Robber Baron –
business leaders used unscrupulous
means and bribery of public officials.
 Barons destroyed competitors and
crushed workers to create profits.

35. Breaking the law!
 Whether good or bad, businessmen
fight economic warfare…
 Monopoly: complete control over a
product by one company.
 Monopolies are illegal, then and now,
but laws are ignored.
 Cartels – companies making the same
product cooperate to limit supply.
 ILLEGAL!!!!

36. Monopolies, and Cartels, and Trusts oh my
 Illegal for one company to own stock in
another company…
 John Rockefeller found a way around the law.
 Trust: a group of separate companies are
managed by a single board…the trustees.
 Legal monopoly
 Rockefeller’s Standard Oil was 40 different
companies combined in a trust.
 Rockefeller controlled 90% of the US oil
industry - Titusville, PA!
Trust me…heh, heh!

37. Slay the dragon! Kill the
beast!
 Sherman Antitrust Act – (1890) outlaws any
combination of companies that restrain
interstate trade.
 Not enforced for 15 years.
 Used by business against labor unions.

38. Robber Baron Tricks of the Trade:
 Horizontal Consolidation: bringing together different firms in the
same business to form one larger company. (Rockefeller’s strategy –
bought forty refineries.)
 Advantage -
STANDARD OIL

39. Power of horizontal
consolidation
Your refinery
Rockefeller &
Standard Oil

40. Robber Baron Tricks of the Trade:
 Vertical Consolidation: gaining control of the many different phases
of a product’s development. (Carnegie’s plan with Steel)
 Advantage? -
Carnegie Steel Company
Iron mines
Railroads
Ships
Schools

41. Mass production is good!
 Economies of Scale: as production increases, the cost
to produce each item often lowers. Cheaper prices!
Chevy Volt
$48,000

42. Horizontal
consolidation
Rockefeller &
Standard Oil

43. Ida Tarbell  Ida Tarbell –
History of
Standard Oil

44. Business cycle
 Carnegie Steel and Standard
Oil one of many industrial
giants born in late
1800s…General Electric,
Dupont, Westinghouse,
Ford
 As giant companies went so
did US economy.
 Business cycle – cycle of
boom and bust in economy.
 GDP continues upward
erratically!

45. Feed me!!
Industrialization and Workers
 Expanding business desperate for
workers!
 Nine million Americans moved to
cities
 Contract Labor Act (1864) –
employers pay immigrants
passage to America if agree to
work for a year.
 14 million immigrate 1860-1900
0
10
20
30
40
50
60
1860 1870 1880 1890 1900
Agriculture
Industry

46. Land of opportunity! Money! Hooray

47. “He that shall not work, shall not eat”
 “I regard my people as I regard my machinery. So long as they can do my work for what I choose to
pay them, I keep them. I keep them, getting out of them all I can.”-Factory Owner - 1883
 Late 1800s factory working conditions
 children worked at 12
 no insurance or assistance
 12 hr. days, 6 days a week
 unsafe working conditions
 675 workers killed a week in US
 piecework – paid fixed amount
per finished piece
 division of labor – workers perform
one small task over and over.

49. Timmy doesn’t look happy
Neither do his buddies

50. I’d rather be in
Cultures II than
shelling oysters.

52. The American Dream? What is it?
 Achieving the Dream
 Education 3
 Perseverance 3
 Financial expertise 1
 Self-confidence 0
 Hope 2
 Luck
 Innate intelligence
 Positive people skills 2
 Physical appearance

53. Chicago - 1860

54. Chicago - 1900

55. “He that shall not work, shall not eat”
 “I regard my people as I regard my machinery. So long as they can do my work for what I choose to
pay them, I keep them. I keep them, getting out of them all I can.”-Factory Owner - 1883
 Late 1800s factory working conditions
 children worked at 12
 no insurance or assistance
 12 hr. days, 6 days a week
 unsafe working conditions
 675 workers killed a week in US
 piecework – paid fixed amount
per finished piece
 division of labor – workers perform
one small task over and over.
o Monotony!

56. Women in the Workforce
 Women no chance
of advancement in
factories.
 Given easy,
repetitive jobs like
stitching or chicken
plucking.

57. Yesterday’s Misery
 1800s you were literally on your own if something happened
to you.
 No unemployment benefits, no social security, no health
insurance, no pensions, no medicare…
 If you lost your job you were lazy or weak.
 Meanwhile, the richest 9% held nearly 75% of the nation’s
wealth.

58. The Great Strikes

59. The Socialist Challenge
 Workers strike back first with ideas!
 Socialism: philosophy that favors
public control of property and
income, not private control.
(Upton Sinclair was this)
 As a society we decide how
wealth is distributed.
 Many socialists say equally.
 People should cooperate, not
compete.
Upton Sinclair – “I
wrote the Jungle”

60. Karl Marx
 Karl Marx – 1848, wrote
Communist Manifesto.
 Predicted a violent working man
revolution
 Capitalism would collapse
leading to a socialist society.
 Revolutionary socialism called
Communism.
Karl Marx

61.  Anarchists – radicals who oppose all
government. Hello, my name is
Jurgis Rudkus!
Have you seen
Phil Conner?

62. Workers had 2 Choices
 Some workers embraced these ideas.
 The vast majority did not.
 Labor unions – workers organize, elect leaders
and coordinate efforts for better working
conditions.
 Unions called strikes, boycotts and sometimes
violence to force…
 Collective Bargaining: Process where workers
negotiate as a group with employers.

63.  Employers feared unions
 Fired union organizers
 “Yellow dog” contracts – Want a
job? Sign here promising never to join
a union.
 Refuse to negotiate
 Scabs – replacements for striking
workers (new immigrants, blacks)

64.  Results of the strikes…
 Americans associate unions and
especially Socialism with violence!
 Gradual improvement of working
conditions

65. Haymarket Riot
 On May 3, 1886 a fight
broke out between
workers and scabs.
 Workers who are called
by employers to replace
striking workers.
 The next day at a rally,
anarchists, radicals
who oppose all
government, joined the
workers and threw
bombs at police and
violence erupted.

66. Results of Haymarket Riot
 Many Americans associated Unions
with violence because of the actions of
the anarchists.
 The violence at Haymarket gave
Unions a black eye that would take
years to erase.

67. Pullman Strike
 In June 1894, 120,000 railway workers
struck to protest 25% pay cuts and layoffs.
 Eugene Debs, union leader, told strikers not
to interfere with mail delivery, which was
mostly done by train.
 Things did get out of hand however and
Uncle Sam sent in troops.

68. The Results of the Pullman Strike
 The Courts agreed with
business owners and
they prohibited all
union activity that
disrupted railroad
activity.
 This official
government opposition
limited unions for the
next 30 years, but
unions did make gains
to help workers.

69. Chapter 14 Vocabulary
 Transcontinental
railroad
 Bessemer process
 Mass production
 Monopoly
 Trust
 Cartel
 Sherman antitrust Act
 Horizontal/vertical
consolidation
 Piece work
 Division of labor
 Socialism
 Collective bargaining
 Scabs
 Anarchists

70. Triangle Shirtwaist Company
 Not Good
 Doors locked from the outside, fire exits
blocked, working with flammable fabrics
and on the 8th floor of a building….
 Guess what happens…you’ll have to
wait and see until chapter 16. Ha Ha Ha