1. Industrial Development

2. Industrial World Leader
-by 1880, U.S. is world’s leading producer of goods
-reasons why????
unlimited labor force
Poor whites, freedmen, immigrants
abundant coal supply
iron mining
Iron and oil abundant
discovery of oil - Edwin Drake (“black gold”)
railroad development
Steel production more efficient
More steel = more railroads
The United States, nearing the turn of the century in the 1880s and 1890s, teemed with immigration from many European nations, as well as many Chinese immigrants. These immigrants provided a steady work force, as well as a cheap work force, as employers could get away with paying them less per hour.

3. Edwin Drake’s discovery of oil led many to drill for the “black gold
Edwin Drake’s discovery of oil led many to drill for the “black gold.” At first, the unrefined petroleum brought in money for its producers and refiners. Entrepreneurs began petroleum-refining industries to transform the oil into kerosene for lamps, and they got rid of the by-products, like gasoline. It was not until the production of the car and other mechanized items, that oil refining became big business.

4. Public Support -laissez-faire government policies
Government does not get involved in business
Competition and quality products
-unlimited immigration supplied labor
Many workers, low pay
-high tariffs protected American business
Buy American products
-public financing of railroads

5. Entrepreneurs and Innovations
-late 1800’s saw an explosion of innovation and invention
-telephone (Alexander Bell)
Really helped businesses
-light bulb (Thomas Edison)
Work longer hours
-electric power-Nikola Tesla—AC Power
Factories can start anywhere
-Bessemer Process
Steel production cheaper
More railroads
-typewriter
Women in the workplace
Alexander Graham Bell making the first “phone call.” The telephone and electric power revolutionized how businesses operated, and they created an economic boom.

6. Iron is a dense metal, but it is soft and tends to break and rust
Iron is a dense metal, but it is soft and tends to break and rust. It also usually contains other elements, such as carbon. Removing the carbon from iron produces a lighter, more flexible, and rust-resistant metal—steel. The raw materials needed to make steel were readily available; all that was needed was a cheap and efficient manufacturing process. The Bessemer Process increased iron refining into steel by blasting compressed air through molten iron to burn out excess carbon and impurities (which make iron rust). This improved (and cheaper) method of steel production led to a steel boom. Major industries, such as the railroads prospered from this, as well as architectural projects.

7. Entrepreneurs and Innovations
-photography
-phonograph (record player)
-motion pictures
Silent films
-radio—Nikola Tesla
Not widely used yet
-retail stores (Sears & Roebuck)
Mail-order catalogs
Buy products not make them
-canned foods
Keeps food better longer
People do not have to farm

8. Entrepreneurs and Innovations
-John D. Rockefeller (Oil)
-Andrew Carnegie (Steel)
-J.P. Morgan
Investment Banker
-Cornelius Vanderbilt
Railroads
-Dupont Family
Gunpowder
-James B. Duke
Tobacco
-George Westinghouse
Electricity
Andrew Carnegie
John D. Rockefeller
Cornelius Vanderbilt
J.P. Morgan

9. Born in Scotland to penniless parents, Andrew Carnegie came to this country in 1848, at age 12. Six years later, he worked his way up to become private secretary to the local superintendent of the Pennsylvania Railroad. One morning, Carnegie single-handedly relayed messages that unsnarled a tangle of freight and passenger trains. His boss rewarded Carnegie by giving him a chance to buy stock. Carnegie’s mother mortgaged the family home to make the purchase possible. Soon Carnegie received his first dividend.
Carnegie was one of the first industrial moguls to make his own fortune. His rise from rags to riches, along with his passion for supporting charities, made him a model of the American success story.

10. Growth of towns, new markets, and new opportunities
Railroads lead the Way
-”iron horse”
Growth of towns, new markets, and new opportunities
-Leading consumer of goods
Other industries grow
-better transportation leads to growth
People and businesses expand across the nation
-transcontinental, 1869
-standardization of time
Time zones
Each community still operated on its own time, with noon when the sun was directly overhead. Travelers riding from Maine to California might reset their watches 20 times. On November 18, 1883, railroad crews and towns across the country synchronized their watches. In 1884, an international conference set worldwide time zones that incorporated railroad time. The U.S. Congress, however, didn’t adopt railroad time as the standard until 1918.

11. -Development of Company Towns Owned and run by companies
Railroad Prosperity
-growth of urban areas
-Development of Company Towns
Owned and run by companies
Could always watch employees
Pullman, Illinois makes RR cars
Lived in Pullman homes and followed strict rules
-railroad scandals
Credit Mobilier
Grant’s Presidency, lay track for too much and pocket profit
gov’t land grants
Selling land for profit
The nearby town that Pullman built for his employees provided for almost all of workers’ basic needs. Pullman residents lived in clean, well-constructed brick houses and apartment buildings with at least one window in every room—a luxury for city dwellers. In addition, the town offered services and facilities for the residents’ convenience. However, the town remained firmly under Pullman control. Residents were not allowed to loiter on their front steps or to drink alcohol. Pullman hoped that his tightly controlled environment would ensure a stable work force.

12. Grange and the Railroads
-Railroad abuses
High prices keep farmers in debt
Charged different rates
-Granger Laws (Populists)
Established maximum freight and passenger rates
States regulated railroads
-Supreme Court rulings
Granger Laws unconstitutional
-Interstate Commerce Act
attempt to regulate business
Fed. gov. in charge of railroads
Grangers throughout the West, Midwest, and Southeast convinced state legislators to pass laws to establish maximum freight and passenger rates and to prohibit discrimination amongst customers. These Granger laws were tested in the Supreme Court case Munn v. Illinois, but the Court upheld the laws, allowing states to regulate the railroads for the benefit of the farmers and consumers. Later, the Supreme Court ruled that a state could not set rates on interstate commerce. Therefore, the states could not regulate interstate railroads. In 1886, to regulate interstate railroads, the federal government passed the Interstate Commerce Act.