1. Effects on Farmers, Oil, and Steel
Rail Road Industry
Effects on Farmers, Oil, and Steel

2. Problems with Rail Roads
Late 1800’s farmers where having to mortgage their farms to be able to buy land and produce more crops.
Banks were foreclosing and railroads were taking advantage and charging too much for shipping.

3. Often RR were charging more in shipping than what the cargo was worth.
RR made deals with grain brokers and merchants to control grain storage prices.

4. The Grange and Rail Roads
Munn vs. Illinois (1877)
Supreme court upheld Granger laws, the state won the right to regulate the railroads
Interstate Commerce Act
1886 S.C. ruled that a state could not regulate rates on interstate commerce.
1887 reestablished the right of federal govt. to supervise the RR
ICC is created (Interstate Commerce Commission)
Farmers started to demand govt. control of RR’s.
Misuse of Govt. land grants by the RRs.
RR entered fixed prices, put farmers in debt.
RR charged different prices to different customers

5. Fall of Populism Panic of 1893 July, 1893 Economy grew too fast Erie
Farmers and business people had overextended themselves with loans and debt.
Feb, 1893: RR’s closed
Philadelphia
Reading
July, 1893
Erie
Northern Pacific
Union Pacific
Santa Fe

6. Impacted other industries
Iron, steel, 15,000 various business
600 banks
Dec. 1894
1/5 of the population /workforce was unemployed

7. Impact on the Oil Industry
By 1901, more than 1,500 oil companies have charters
Oil tycoons like John D. Rockefeller began to ship his oil on trains.
Rockefeller struck deals with Rail Road tycoons like Cornelius Vanderbilt to ship oil as fuel all over the United States.

8. Impact on Steel by the Rail Roads
Steel being widely used by the 1900’s, it was natural that steel would partner with the railroad industry
Production of: trains, rails, cargo cars, sleeper cars, etc.
Steel tycoon Andrew Carnegie (who once owned Rail Roads) started using his new process of producing steel to supply rail road companies with steel all over the United States.