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The Growth of Industrialism

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Presentation on theme: "The Growth of Industrialism"— Presentation transcript:

1 The Growth of Industrialism
The Second Industrial Revolution

2 Causes of Rapid Industrialization
Steam Revolution of the 1830s-1850s. The Railroad fueled the growing US economy: First big business in the US. A magnet for financial investment. The key to opening the West. Aided the development of other industries.

3 Causes of Rapid Industrialization
3. Technological Innovations: Steel Bessemer Process Railroads Skyscrapers Electricity Telegraph, telephone Escalators, elevators, central heating Generators, underground conductors

4 Thomas Alva Edison “Wizard of Menlo Park”

5 Alexander Graham Bell Telephone (1876)

6 Invention and innovation
Machines increase production Sewing machine Assembly line technique Henry Ford Oil Allowed for automobiles, planes

7 U. S. Patents Granted 1790s  276 patents issued.

8 Causes of Rapid Industrialization
Unskilled & semi-skilled labor in abundance. Abundant capital. New, talented group of businessmen [entrepreneurs] and advisors. Market growing as US population increased. Government willing to help at all levels to stimulate economic growth. Abundant natural resources.

9 New Business Culture Laissez Faire  the ideology of the Industrial Age. Individual as a moral and economic ideal. Individuals should compete freely in the marketplace. The market was not man-made or invented. No room for government in the market!

10 2. Social Darwinism British economist. Advocate of laissez-faire.
Adapted Darwin’s ideas from the “Origin of Species” to humans. Notion of “Survival of the Fittest.” Herbert Spencer

11 William Graham Sumner Folkways (1906)
Social Darwinism in America Individuals must have absolute freedom to struggle, succeed or fail. Therefore, state intervention to reward society and the economy is futile! William Graham Sumner Folkways (1906)

12 New Business Culture: “The American Dream?”
Protestant (Puritan) “Work Ethic” Horatio Alger [100+ novels] Is the idea of the “self-made man” a MYTH??

13 Industrial Leaders Rockefeller and Oil Carnegie and Steel
By 1879, Standard Oil owned over 90% of the market Also gained control of pipelines and railroads Reduced oil prices for the first time Carnegie and Steel Built a steel plant using the Bessemer Process Fired incompetent employees, slashed prices during recession and kept tabs on competitors In 1900, Carnegie produced ¼ of the steel

14 Other Industry leaders
Vanderbilt Swept up the railroad industry into smartly linked trunk lines Armour and Swift Established control of the beef market Guggenheim Copper industry

15 New Type of Business Entities
Corporation An organization owned by many people, but treated by law as a single person. Pools Agreements to maintain prices at a certain level.

16 New Type of Business Entities
3. Trust: allows one person to manage another person’s property. 4. Monopoly: gaining exclusive control of a market.

17 Types of Monopolies Horizontal Integration Vertical Integration
Combining many firms in the same type of business into one large corporation. Vertical Integration Owns all of the different businesses it depends on for its operation.

18 New Type of Business Entities
Trust: Horizontal Integration  John D Rockefeller Vertical Integration: Gustavus Swift  Meat-packing Andrew Carnegie  U. S. Steel

19 New Type of Business Entities

20 % of Billionaires in 1900

21 % of Billionaires in 1918

22 Criticism and Defense of Big Business
Critics Gap between rich and poor Disproved of minority owning resources The material worth of 1% of the population was greater than 99% combined. (1900)

23 William Vanderbilt The public be damned!
What do I care about the law? H’aint I got the power?

24 Standard Oil Co.

25 The Bosses of the Senate

26 Criticism and Defense of Big Business
Taken risks and so were entitled to profits “The Gospel of Wealth” Carnegie donated $350 million during his lifetime to libraries, schools, and research

27 “On Wealth” The Anglo-Saxon race is superior.
“Gospel of Wealth” (1901). Inequality is inevitable and good. Wealthy should act as “trustees” for their “poorer brethren.” Andrew Carnegie

28 Regulating the Trusts 1877  Munn. v. IL
1886  Wabash, St. Louis & Pacific Railroad Company v. IL 1890  Sherman Antitrust Act in “restraint of trade” “rule of reason” loophole 1895  US v. E. C. Knight Co.

29 Impact of Industrialism
Benefits the middle class Greater comforts and conveniences Sears’ general catalog Clerical and sales positions expanded with female labor Sent children to college Buy property

30 Impact of Industrialism
Life for average Americans Candle-lit homes No indoor plumbing or heating Could not afford a phone or stove Only ¼ of the population owned property 7% of Americans had high school diplomas Laborers had neither time or money to enjoy leisure activities and luxury goods

31 Impact of Industrialism
Industrial Working Conditions 10-12 hour days Faced extreme heat Permanent back injuries Injuries from faulty machines or from lack of sleep “become a hand—not a brain—not a soul—deadened into a part of a machine.”

32 Impact of Industrialism
Low pay and reasons to stay Sought to keep jobs long enough to return home richer Competing supply of labor Take home pay as low as $5 a week Kept thousands of families living at poverty levels.

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