1. HIST3: CH 17 The Industrial Revolution

2. I. The Industrial Revolution
A transformation in the way goods were made and sold
More Americans left farming to work in factories or retail
The economy was dominated less by family businesses and more and more by large-scale corporate firms

3. Corporate
business
organization
Laissez-
Faire
attitude of
government
Capital
for
investment
Large
labor
supply
National
market
Abundant
resources
Technology
and
Inventions
Second
Industrial
Revolution

4. The Basic Industries
Railroads
Steel
Petroleum

5. The East and West were united; Items that had previously taken months to move could be sent in a matter of days at a fraction of the cost; Western products like crops, coal, and other minerals could be moved easily to the east coast; Passengers and freight from the east coast could reach the west coast in a matter of days; Many people began settling in western areas. The 1890 census showed new migration patterns and settlement; Western territories applied for statehood; Many historians cite the transcontinental railroad as a major factor in the closing of the western frontier.
Railroad operators depended the telegraph to communicate train locations and prevent collisions
The Central Pacific Railroad brought in Chinese laborers.
The Union Pacific Railroad hired Irish immigrant, African Americans, and Mexican Americans.

6. Technology
The incandescent light bulb, created by Thomas Edison in 1879
Alexander Graham Bell’s invention in 1876 of the telephone
Alexander Graham Bell and the telephone

7. Innovative Financing, Law, and Business Practices
The number of corporations increased dramatically
Corporations controlled shops across a broad stretch of the nation
They created a class of managers in the rapidly expanding middle class
Andrew Carnegie: Carnegie Steel Corporation.
John D. Rockefeller: Standard Oil.
Cornelius Vanderbilt: built the first Railroad line connecting New York City and Chicago. He also built New York’s Grand Central Station.
J. Pierpont Morgan: J.P. Morgan and Company (Banking) and in 1901 created U.S. Steel, the world's first billion-dollar corporation.

8. Horizontal integration is the growth of a business through acquiring additional business activities in the same industry. A business either combines with other similar companies or buys them, called “mergers and acquisitions”. The benefits to the firms that horizontally integrate include cheaper operating costs because production is on a larger scale, increased market control of the product including over suppliers and distributors, and greater control over treatment of workers.
An example of this form of expansion would be Standard Oil’s acquisition of almost all oil refineries around the U.S.
Vertical integration is the growth of a business through the acquisition of the materials that make the product, the factories that manufacture the products including the machines needed to produce the product, as well as the distribution channels to take the product to market. This allows the business to control all aspects of the industry and provides large profits.
An example would be Carnegie Steel’s control of raw materials, production of steel, transportation, and companies that made products out of steel.

9. II. The National Market: Creating Consumer Demand
By the late nineteenth century, with railroads spanning the nation and the process of replaceable parts making more goods available to a consuming public, the entire American nation became a marketplace.
Advertising
Combination of technological and transportation innovations allowed the creation of national brands.

10. TOBACCO ADS TARGETING WOMEN AND CHILDREN

11. Stores and Mail Order Frank Woolworth’s Five and Ten Cent Store
Emergence of advertising and national chain stores helped create a consumer culture in the nation’s cities
To reach rural customers, entrepreneurs used catalogues
R.H. Macy in New York City
Marshall Field in Chicago

13. Harmful Business Practices
Monopolization
Manipulating Stock Prices
Price Gouging
Environmental Damage
Capital: the amount and type of resources a person or a company has access to including money, property, and other valuables
Corporation: a type of business organization created when a group of individuals apply for a license or charter from a state legislature
Dividends: a share of the profits issued to investors from a corporation
Pool: a group of companies in the same industry would get together to fix prices and otherwise manipulate the industry to their advantage
Trust: major stockholders of many different corporations give their stock to “trustees” who promise dividend payments in return. This allowed the trust to operate on a large scale on behalf of several companies at once and entire industries
Monopoly: domination of all aspects of an entire industry by a trust, individual, or corporation

14. Working Conditions
Immigrants faced serious threats in the workplace
Triangle Shirtwaist Company occupied the top 3 floors.
Triangle Shirtwaist Fire leads to reform in working conditions.
Shirtwaist

15. Thousands of pounds of highly flammable fabric, rags, and rubbish lay piled on the eighth, ninth, and tenth floors of the Triangle Shirtwaist Factory. And to prevent workers from taking breaks or stealing fabric, the doors to the fire escapes were kept locked.

16. III. The Politics of the Industrial Age
The devotion to the needs of business by politicians led to:
a dramatic decline in attention to the treatment of African Americans
a sullying of the image of politicians
Political machines controlled the activities of political parties in the city. Ward bosses, precinct captains, and the city boss worked to:
ensure that their candidates were elected;
make sure that city government worked to their advantage.

17. Boss Tweed ran New York City.
Like a pyramid: local precinct workers and captains at the base, ward bosses in the middle and the city boss at the top
City Boss = Power broker (most were democrats and many were immigrants themselves, usually in large cities like NYC,BOS,CHI,PHI).
The “Boss” (typically the mayor) controlled jobs, business licenses, and influenced the court system.
Precinct captains and ward bosses, often 1st or 2nd generation immigrants, helped new immigrants with jobs, housing, and naturalization in exchange for votes.
Boss Tweed ran New York City.
Political machine organization
City Boss
Ward bosses
Role of Immigrants:
Immigrants were the workers who ran the political machine.
They offered their loyalty and votes in exchange for favors and solutions to their problems.
Workers and Captains

18. Graft and Scandal:
Some political bosses were corrupt and their political machines practiced election fraud by using fake names and voting multiple times to ensure victory.
Bribes were common and construction contracts often resulted in kick-backs.
Because the police were hired by the boss, there was no close scrutiny.
What is Graft?
Graft is the illegal use of political influence for personal gain.
How did the bosses use graft for their own personal gain?
1. To win elections.
2. To make themselves richer.
3. To finance the operations of the political machine.
What are kickbacks?
A Kickback is the illegal practice of getting contract workers hired by the bosses to overcharge the city for their services.
Then the overpayment would be split between the city boss and the contract-worker.
How did the bosses use kickbacks for their own personal gain?
The bosses would enrich themselves as well as the machine.

19. IV. The Rise of Labor
When workers went on strike, the government often intervened on the side of management by ordering troops to protect strikebreakers
Nevertheless, workers still went on strike and fought for better working conditions
Total strikes from 1881 to 1899 and the number of workers involved in those strikes. Add three 0’s for the workers numbers, for example the number of strikes in 1886 was 1,557 while the number of workers was 600,000.

20. The Great Railroad Strike of 1877
The country's first major rail strike.
Started the first general, nationwide strike in U.S. history from the Atlantic to the Pacific Coast.
The strikes and violence paralyzed the nation’s business and forced governors in ten states to call up over 60,000 militia (national guard) members to reopen rail traffic.
It was the first major strike broken up by the U.S. Army.
More killing and wounding of strikers by government military then any other strike in U.S. history. At least 100 were killed and many more wounded.
The Railroad Strike set the stage for other strikes and violent protests for the rest of the 19th century.

21. Knights of Labor:
Under the leadership of Terrence Powderly
The KOL’s major goals were:
1) 8-hour work day
2) End of child labor
3) Equal pay for men and women
4) Improved working conditions
5) Compensation for on-the-job injuries
6) Elimination of private banks
American Federation of Labor (AFL):
Founded in Columbus, Ohio in 1886 by Samuel Gompers who was its president until his death in 1924
Represented skilled workers unions across the nation and only allowed workers to join, not employers like the KOL
Less radical than other organizations that emerged during the same era
Focused on support of candidates in politics, rather than forming its own political party
It was the largest union in the U.S. for many years
Allowed for segregated chapters of the union
Like many other unions at the time, supported legislation that protected the American worker like the renewal of the Chinese Exclusion Act and entrance literacy exams which would prevent non-English immigrants from entering the country