1. Industrial Revolution

2. Post Civil War
Between the Civil War & 1900, steam & electricity replaced human labor
Iron > wood
Steel > iron
Pre Bessemer process, 3-5 tons of iron was hardened into steel per day
Now done in 15 min

3. People & goods could move by railroad
Telephone, typewriter, & adding machine sped up business work
Machines changed farming (pre Civil war = 61 hrs of labor to produce an acre of wheat)
By 1900 it took 3 hrs, 19 min

4. Manufactured ice allowed food to be transported over long distances
By 1884, 100 million tons of coal were mined
More coal = more steel
Electricity started replacing steam = more copper

5. Hard Work & Corruption Inventors created new processes & machines
This led to thousands of humans doing dangerous work
Immigrants from Europe & China made up the railroad labor force

6. 1st transcontinental railroad was built when Union & Central Pacific railroads combined
Central Pacific started on the West & headed East
Spent $200,000 in Washington on bribes for 9 million acres of free land
Paid 3,000 Irish & 10,000 Chinese $1 per day to construct the railroad

7. The Union Pacific started in Nebraska & went West
Built on 12 million acres of free land
Created own construction company (Credit Mobilier) and overpaid them ($94 vs $44 million)
+20,000 workers: Irish immigrants, war vets, 5 miles of track per day, thousands died from weather & Indian attacks

8. Sold shares cheaply to Congressmen to prevent investigation
“Wild fraud” led to more control of railroad finances by bankers
Bankers wanted profit by law, not theft
By the 1890s, the country’s railways were ran by 6 large companies

9. The Big Names
J.P. Morgan
Son of a banker that sold stocks for railroads
Relative on mother’s side founded Yale
After high school he studied in Europe, learning French & German
Gained fame by reorganizing & consolidating troubled railroads

10. Eventually controlled 1/6th of the entire nations’ railroads
The US had no central bank, so he used his influence to save the nation from economic crisis
Rescued America’s gold standard by loaning the govt $60 million
Led Wall Street out of the 1907 financial crisis
Fed Reserve was created to keep down his power

11. Cornelius Vanderbilt
Born in NY
Transported ship cargo as a teen, eventually owned fleet of small boats & learned ship design
Liked marrying cousins

12. 1820s started own business building steamships & operating ferry lines
Became dominant by engaging in fare wars w/ rivals
Hated by many for shrewd ways
His steamship service gained fame during California Gold Rush (pre-railroads)

13. Shifted focus from shipping to railroads
Gained controlled of lines operating from Chicago to NY
Established an interregional railroad system, cutting costs & increasing efficiency
Gave $1 million towards creation of Vanderbilt University in Nashville, TN

14. John D. Rockefeller
Started as a bookkeeper in Cleveland, became a merchant, & saved $$$
He bought his first oil refinery in 1862
Married the daughter of a rich abolitionist

15. By 1870, he set up Standard Oil Company
Made secret agreements w/ railroads to ship his oil w/ them if they gave him discounts
This drove competition out of business
“If we did not sell out…we would be crushed out…There was only one buyer on the market and we had to sell at their terms.”

16. He developed the Standard Oil Trust (controlled 90% of nation’s refineries & pipelines)
Rockefeller was worth $200 mill b4 he moved into iron, copper, coal, shipping, and banking (Chase Manhattan Bank)
Donated half a billion dollars b4 passing

17. Andrew Carnegie
Born poor in Scotland, family moved to Pittsburgh
Telegraph clerk at 17, secretary to the head of the Penn Railroad, soon succeeded boss as railroad superintendent
Started making investments in coal, iron, & oil
Left post w/ railroad & started building iron bridges & a telegraph firm
By 30s he was wealthy broker in Wall Street selling railroad bonds for commissions

18. Went to London in 1872, saw the Bessemer method of producing steel, & returned to the US to build a million dollar steel plant
Kept out foreign competition by using high tariffs set by Congress
By 1900 Carnegie was making $40 million a year

19. Sold his steel company to J.P. Morgan for +$480 million
Morgan merged Carnegie Steel w/ other steel companies to create US Steel (world’s 1st billion dollar corporation)
After retiring, Carnegie devoted his life to charity ($350 million)
“The man who thus rich dies disgraced”