1. Gilded Age Industrialization
During the Gilded Age, American businesses were transformed:
Massive corporations replaced small, family businesses
New technology, transportation, marketing, labor relations, & efficient mass-production
By 1900, the U.S. was the most industrialized country in the world

2. The Business of Invention
19th-century inventors led to an “Age of Invention”:
Cyrus Field’s telegraph cable
Business typewriters, cash registers, adding machines
High-speed textile spindles, auto looms, sewing machines
George Eastman’s Kodak camera
Alexander G. Bell’s telephone
By 1905, 10 million Americans had phones; (Bell Telephone Co became AT&T) 13

3. The Business of Invention
Thomas Edison, the “Wizard of Menlo Park,” created the 1st research lab in New York
Edison Illuminating Co was the to 1st use electric light in 1882
Tesla’s alternating current (AC) allowed electricity to travel over longer distances & to power streetcars & factories

4. The Business of Invention
New technologies allowed for increased industrial production
New machines were incorporated into the first assembly lines which allowed for continuous & faster production of goods
The railroad linked every region of America & allowed for a mass consumption of goods 13

5. The Midwest Made Meat for America
A new-and-improved “market revolution”: More regional specialization made mass production & mass consumption possible
(Chicago→meat, St Louis→beer, & Minneapolis→grain)

6. New Methods of Marketing
Marketing became a “science”:
Advertising firms boomed
Department stores like Macy’s & Marshall Field’s allowed customers to browse & buy
Chain stores like A&P Grocery & Woolworth’s “Five & Ten”
Mail-order catalogues, like Montgomery Ward sold to all parts of America 14

7. New Forms of Business Organization
“Trusts” use a board of trustees to manage a company
“Holding companies” oversee & manage other subsidiary companies
New types of business organization were used to increase profits:
“Trusts” & “holding companies” integrated various businesses under 1 board of directors
Vertical & horizontal integration maximized corporate profits
Frederick Taylor’s “scientific management” emphasized time efficiency & mid-level managers
Led to monopolists like Carnegie, J.P. Morgan, & Rockefeller 13

8. Vertical & Horizontal Integration
U. S. Corporate Mergers
By 1900, 1% of U.S. companies controlled 33% of all industry

9. New Forms of Business Organization
Business leaders used a variety of ideas to justify their wealth:
The “Gospel of Wealth” argued that it is God's will that some men attained great wealth
Social Darwinism taught that natural competition weeds out the weak & the strong survive
Were monopolists “captains of industry” or “robber barons”? 14

10. The Industrialization of America

11. The Second Industrial Revolution was fueled by 3 industries: railroads, steel, & oil

12. The Railroad Industry
Cornelius “the Commodore” Vanderbilt was the most powerful figure in the railroad industry
America’s first “big business” was the railroad industry:
Railroads stimulated the coal, petroleum, & iron/steel industries
Large companies bought small railroads, standardized gauges & schedules, & pooled cars
Small lines in the east acted as tributaries to the 4 great trunk lines into the West 3

13. Problems of Growth
Speculators like Jay Gould built & bought rail lines to profit with little concern for efficient use
But, the railroad industry faced problems due to overbuilding in the 1870s & 1880s:
Mass competition among RRs
RR lines offered special rates & rebates (secret discounts) to lure passengers & freight on their lines
Pooling & consolidation failed to help over-speculation 8

14. Problems of Growth
RR bosses asked bank financier J.P. Morgan to save their industry:
Morgan created a traffic-sharing plan to end wasteful competition
“Morganization” fixed costs, cut debt, stabilized rates, issued new stock, & ended rebates
Created a “board of trustees”
By 1900, 7 giant (centralized & efficient) rail systems dominated 8

15. The Steel Industry Steel transformed world industry:
Allowed for taller buildings, longer bridges, stronger railroad lines, & heavier machinery
Andrew Carnegie’s company made more steel than England
Carnegie converted his steel plants to the Bessemer process & was able to out-produce his competition & offer lower prices
Andrew Carnegie was the great example of the “American Dream” & social mobility
Henry Bessemer (& William Kelly) turned iron into steel in 1850s—process allowed for mass production of steel 9

16. International Steel Production, 1880-1914
The U.S. was ideal for steel production because it had lots of coal, iron, & railroads

17. Rockefeller and Oil Petroleum also changed industry
New industrial machines needed kerosene for lighting & lubricants
John D. Rockefeller monopolized the oil industry, lowered oil costs & improved the quality of oil
By 1879, Standard Oil ruled 90% of all U.S. oil & sold to Asia, Africa, & South America
In 1863, John D. Rockefeller created Standard Oil Company in Cleveland (at age 24!); he also used spies, bribery, threats 12

18. Standard Oil: The Monster Monopoly?

19. The Industrial Workers

20. Industrial Workers Industrial work was hard:
Laborers worked long hours & received low wages but had expensive living costs
Industrial work was unskilled, dangerous, & monotonous
Gender, religious, & racial biases led to different pay scales
These conditions led to a small, but significant union movement
Low wages ($ /year but living cost $600); railroad injury rate 1 in 26, death rate 1 in 399; Composition of work force in 1900: 20% women (in 296 of 303 jobs) 10% of girls & 20% of boys had jobs (“child labor” meant ↓14 yrs)
all children poorly paid, but girls less than boys; Earning comparisons: Adults > Children; Men > Women; Skilled > Unskilled; Protestants > Catholics or Jews; Whites > Blacks & Asians; Blacks worked menial jobs; Chinese worked on Pacific Coast; often discriminated against (Chinese Exclusion Act in 1882)

21. Early American Labor Unions
In 1868, Knights of Labor formed to help all type of workers escape the “wage system”
The most successful union, the American Federation of Labor (1886) led by Samuel Gompers:
Made up only of skilled labor & sought practical objectives (better pay, hours, conditions)
Included 1/3 of all U.S. laborers
Membership regardless of skill, race, or sex
The KoL lacked organization to survive
Excluded women, blacks, unskilled laborers 17

22. The U.S. experienced an “era of strikes” from 1870-1890
The Great RR Strike of shut down railroads from WV to CA & resulted in hundreds of deaths
During the Chicago Haymarket Strike (1886), unionists demanded an 8-hr day; led to mob violence & the death of the Knights of Labor
The Homestead Strike (1892) resulted from a 20% pay cut at one of Carnegie’s steel plants

23. Urbanization:

24. Gilded Age Urbanization
From 1870 to 1900, American cities grew 700% due to new job opportunities in factories:
European, Latin American, & Asian immigrants flooded cities
Blacks migrated into the North
Rural farmers moved from the countryside to cities

25. The Lure of the City
By 1920, for the 1st time in U.S. history, more than 50% of the American population lived in cities

26. Skyscrapers and Suburbs
By the 1880s, steel allowed cities to build skyscrapers
The Chicago fire of 1871 allowed for rebuilding with new designs:
John Root & Louis Sullivan were the “fathers of modern urban architecture”
New York & other cities used Chicago as their model

27. Louis Sullivan “Form follows function”
John Root “Simple & Dignified”

28. Skyscrapers and Suburbs
Cities developed distinct zones:
Central business district with working- & upper-class residents
Middle-class in the suburbs
Electric streetcars & elevated rapid transit made travel easy

29. Tenements & Overcrowding
½ of NYC’s buildings were tenements which housed the poor working class
“Dumbbell” tenements were popular but were cramped & plagued by firetraps
Slums had poor sanitation, polluted water & air, tuberculosis
Homicide, suicide, & alcoholism rates all increased in U.S. cities
Jacob Riis “How the Other Half Lives” (1890)

30. Jacob Riis’ “How the Other Half Lives” (1890) exposed the poverty of the urban poor

31. Strangers in a New Land
From , 23 million immigrants came looking for jobs:
These “new” immigrants were from eastern & southern Europe; Catholics & Jews, not Protestant
Kept their language & religion; created ethnic newspapers, schools, & social associations
Led to a resurgence in Nativism & attempts to limit immigration
Resurgence of the Nativism of the 1850s
4 of every 10 Americans today can trace their ancestry through Ellis Island’s gates

32. Immigration to the U.S.,

33. Foreign-born Population, 1890
The influx of ethnic nationalities led to a new “melting pot” (“salad bowl”?) national image

34. Urban Political Machines
Urban “political machines” were loose networks of party precinct captains led by a “boss”
Tammany Hall was the most famous machine; Boss Tweed led the corrupt “Tweed Ring”
Political machines were not all corrupt (“honest graft”); helped the urban poor & built public works like the Brooklyn Bridge
NY County Courthouse supposed to cost city $250,000 but ended up costing $13million.

35. Boss Tweed
Tweed Courthouse—NY County Courthouse was supposed to cost $250,000 but cost $13 million.
But the Tweed Ring catered to immigrants by building the Brooklyn Bridge & hosting holiday barbeques

36. Social Changes in the Gilded Age
Women made up 40% of university students
Urbanization changed society:
The U.S. saw an increase in self-sufficient female workers
Most states had compulsory education laws & kindergartens
150 new public & private colleges were formed
Cities set aside land for parks & American workers found time for vaudeville & baseball
Private philanthropy led to Stanford, Tulane, Vanderbilt, Cornell, & the Univ of Chicago
Land Grant Act (1862) led to the Universities of WI, CA, MN, IL
“Family time” disappeared for working class
People of all races married later & had fewer children

37. Conclusions: Industrialization’s Benefits & Costs

38. American Industrialization
Benefits of rapid industrialization:
The U.S. became the world’s #1 industrial power
Per capita wealth doubled
Improving standard of living
Human cost of industrialization:
Exploitation of workers; growing gap between rich & poor
Rise of giant monopolies 19