Chapter 14 The Expansion of American Industry

Section 1- A Technological Revolution
I.  American Society and Lifestyles

• In 1860, the majority of Americans were farmers and lived in rural areas.  People generally did not travel very far from their homes. 
• Education for most Americans was not extensive.   Less than 2% of the population were high school graduates, and less than 1% attended college..
• There was no electric lighting.  Although the Telegraph did exist, most communications still took weeks to travel through the country. 
• Railroads had existed in the U.S. for only about 30 years and were mainly made up of “short lines” that connected neighboring cities.  Much of the nation’s commercial transportation was done by steamship, and personal transportation was still mainly horse and wagon.

• Over the next 4 decades, increased industrialization and urbanization, advances in transportation and communication, and numerous new inventions would greatly change everyday life in the United States as well as spark tremendous economic growth.

 

II. Improvements in Transportation
A.  Growth of Railroads

• The building of railroads increases greatly during and after the Civil War.  Trains were the most efficient way to transport goods and passengers, and there was a growing need for a greater network of rail lines.
• A number of improvements contributed to the growth of the railroad industry.
• Standard gauge tracks- allowed all trains to operate continuously on any tracks
• Steel Rails- replaced iron rails, making tracks more durable and reliable.
• Telegraph- by the 1890’s a system of communicating with moving trains was developed.  this helped reduce accidents.
• As railroad activity increased, scheduling became more important.  In 1883 railroad companies adopted a system of 4 time zones across the country.  This system standardized timekeeping in the U.S..

B.  The Transcontinental Railroad

• During the Civil War, Congress passed laws to create a rail line, known as the transcontinental railroad, that would connect the eastern part of the country to the west coast.
• Congress also passed the Homestead Act in 1862, which increased settlement of the West, creating a greater market for such a railroad.
• Two federally chartered corporations were created.  These companies received large grants of money and land from the national government.
• The Union Pacific Railroad Company began building westward from Omaha, Nebraska.
• The Central Pacific Railroad Company began building eastward from Sacramento California.
• In 1869, the two lines came together at Promontory Point in Utah.
• The need for abundant and inexpensive labor led the railroad companies to encourage immigrants to come and work in the U.S..
• The Central Pacific hired Chinese immigrants.  The Union Pacific hired mostly Irish immigrants.
• Many of the workers on the Transcontinental Railroad were injured or killed during its construction.

III. Improvements in Communication
A.  The Telegraph- was perfected by Samuel Morse in 1844.

• The telegraph was the first means of instant communication over distance. 
• This revolutionized communication because it was no longer necessary for someone to physically carry information for it to be transmitted.

B.  The Telephone - invented by Alexander Graham Bell in 1876.  It further revolutionized communication.

• By 1900 there were over a million telephones in use in the United States.

IV. New Inventions and Technology
A.  The Bessemer Process

• In the 1850’s Henry Bessemer, a British inventor, developed a much more efficient process for turning iron into steel which is stronger, more durable, and easier to work with.
• This greatly increased the supply of steel, and made large scale construction and engineering projects much more feasible.  (Skyscrapers, Brooklyn Bridge)

B.  Electric Power

• In the late 1800’s, Thomas Edison became America’s most famous inventor.
• In 1880, Edison developed the first working electric light bulb.  Electric light soon replaced candles and gaslamps. 
• In 1882, Edison created the first centralized power plant.  For the first time, electricity was produced in one location and ditributed to a number of buildings.
• a few years later, George Westinghouse implemented the use of alternating current, which greatly improved the efficiency of distributing electricity.
• By 1900, thousands of power plants were providing electricity to businesses and private homes throughout much of the nation.
• While urban areas were quick to adopt electric power, many rural areas remained without electricity for decades.

C.  Impact of Electricity on Daily Life

• Widespread availability of electricity greatly changed life in the U.S. and around the world.  People came to rely on the convienience of electricity for many tasks such as lighting, refrigeration and transportation.
• Electricity dramatically increased the productivity of American industry, as businesses no longer had to generate their own power. 
• The use of electric lighting allowed factories to run 24 hours a day.
• Many new products that relied on electricity were developed, such as the refrigerator, vacuum and sewing machine.

Section 2 - Growth of Big Business
Following the Civil War, America saw the development of large companies that were incredibly wealthy and powerful.  The men who ran these companies were viewed in two different ways. 

• The term “Robber Barons” implied that these men exploited workers, broke the law, used corrupt politicians, and took advantage of the public in general. 
• The term “Captains of Industry” described these men as daring entrepreneurs who promoted the interest of the entire nation by creating jobs and increasing America’s wealth. 

 Andrew Carnegie – founded steel plants near Pittsburgh (used the Bessemer Process). 

• Carnegie’s business was successful and he was eventually able to drive his competitors out of business by lowering his prices. 
• Carnegie wound up controlling all of the phases of steel production by buying mines and railroads as well as steel mills. 
• Carnegie gave away millions of dollars, much of it to support the building of public libraries. 

Social Darwinism – Theory that people’s situation in life was a result of their ability and effort.  The “fittest” people were successful and wealthy while the “unfit” were destined to poverty. 

• Along with this theory went the idea that the government should not interfere with business. 

Methods used by “Big Business”

• Businesses tried to gain a monopoly over their industry so that they would have complete control over pricing.  There were laws against monopolies, but they were not strictly enforced. 
• Cartels – were organizations of businesses within the same industry that agreed to limit supply and set prices. 
• In 1882, the Standard Oil Company, owned by John D. Rockefeller, devised a plan to circumvent existing laws against monopolies.  Standard Oil created a “trust” with other oil companies in which they combined their operations.  In reality, Rockefeller had bought control of the other companies. 

Sherman Anti-trust Act – outlawed any combination of companies that restrained interstate trade and commerce.  This law was not effectively enforced until 15 years later. 

• Big Businesses were usually able to get around laws aimed at regulating them and they continued to grow in wealth and size. 
• These businesses exerted a large influence over the economy, politics, and society in general. 
• The lack of regulation of the economy led to severe fluctuations in the business cycle (patterns of growth and recession).  In 1893, there was a depression in which almost 500 banks and over 15,000 businesses failed. 

Section 3 - Industrialization and Workers
The amount of people working at industrial jobs in the U.S. increased greatly between 1850 and 1900. 

• Millions of Americans moved from rural farming areas to cities in search of jobs. 
• America also absorbed about 23 million immigrants between 1860 and 1910, most of whom were seeking industrial jobs. 
• Often, businesses recruited people from foreign countries to come and work in the U.S. 

During the second half of the 1800s, there were not many laws that restricted labor practices.  As a result, workers faced difficult circumstances and dangerous conditions. 

• Workers usually worked 12 hour days, six days a week.
• Workers were often paid according to the amount that they produced (piecework). 
• Because of low wages, it often took every member of a family working for that family to survive.  Women earned less money than men, and were shut out of many jobs. 
• Many children, some as young as six years old, worked in factories and mines. 
• Workers faced health risks from dangerous machinery and exposure to hazardous materials.  In 1882, an average of 675 workers per week died in the U.S.
• Industrial workers did not have the reassurance of health insurance, compensation for injury, or unemployment insurance. 
• Most Americans at this time did not believe that the government should provide public assistance.  When families fell on hard times due to a layoff or an injury, they had to fend for themselves or rely on private charities.
• By the late 1800s, some social reformers, such as Jacob Riis, began calling for laws to protect workers, especially children. 

Section 4 - The Great Strikes
The growth of U.S, industry was providing millions of Americans with jobs, but under difficult and sometimes unpredictable circumstances.  On any given day, an industrial worker might be faced with a pay cut or a layoff. 

• This situation gave rise to the growth of labor unions.  Workers used unions to try and improve their bargaining power with employers. 

 
Labor unions that operated on a national scale began to develop in the 1860s. 

• The Knights of Labor was a popular union that recruited all workers male and female, skilled and unskilled.  They supported an eight-hour workday and the end of child labor. 
• In 1882, the American Federation of Labor (AFL) was formed.  It organized skilled workers (men only).  This union was led by Samuel Gompers.
• The AFL sought to improve wages and working conditions and was in favor of using strikes when necessary. 
• In some instances, labor unions became associated with socialism – a political philosophy that advocates government control of a nation’s economy and wealth.
• American unions would face a difficult struggle against the powerful Industrialists who often had politicians and the courts on their side. 
• Employers were opposed to unions and often called for government action against them. 

• Employers used a number of means to discourage unions, such as firing union organizers, forbidding union meetings, using “scab” workers during strikes, making new employees sign contracts in which they promised never to join a union (“yellow dog contracts”).

In order to deal with a downturn in the economy, business owners often implemented wage cuts or layoffs in order to protect their profits.  Sometimes these practices led to strikes.

• Railroad Strike of 1877 - was the first nationwide strike.  It was a reaction to a 10% wage cut by the Baltimore and Ohio Railroad Company. 

• This strike led to violence and rioting and President Hayes used federal troops to put down the strike.  In Pittsburgh, these troops fired on a crowd of rioters and killed several people.  This set a precedent for using government troops to fight striking workers.

• Haymarket Riots – grew out of series of nationwide protests on May 1, 1886 in which workers called for an eight-hour workday. 

• On May 4, Union leaders organized a rally in Chicago’s Haymarket Square.  During the rally, a bomb was thrown into a group of police officers, killing seven of them.  A riot ensued in which dozens of people died from gunfire between police and protesters. 
• Eight anarchists were convicted of starting the Haymarket Riot.

 

• Homestead Strike - In 1892, workers for Carnegie Steel in Homestead, Pennsylvania struck in protest of a wage cut. 

• The strike was called off after an anarchist attempted to assassinate Carnegie’s business partner, Henry Frick.
• The steel industry was able to severely limit the influence of unions for the next 40 years.

• Pullman Strike, 1894 – was a strike by the American Railway Union in protest of layoffs and wage cuts made by George Pullman. 

• The strike included over 120,000 workers and crippled the railway industry. 
• A court order was issued that outlawed the strike.  President Grover Cleveland used 2,500 federal troops to make sure that railway workers complied with the court order. 

Unions were sometimes successful at making gains for their members, but for the most part, it took a long time to overcome the financial and legal obstacles that employers and the government placed in their way.