1.
The Industrial Age

2. Railroads Lead the Way! Essential Question
How did railroad expansion affect the United States economy?

3. Railroad Expansion Railroad expansion is accompanied by consolidation
Large companies buy smaller companies or drive them out of business
Makes large companies more efficient
Makes industrial processes more uniform

4. Railroads Stimulate the Economy
Railroads brought major changes to American industry and American life
Connect east and west coast
Railroads stimulate
Steel Industry
Lumber Industry
Coal Industry

5. Competing for Customers
Large railroads offered rebates to their biggest customers
Smaller railroads are forced out of business
Raised freight rates for farmers and customers shipping small amounts of goods
Railroad industry business leaders formed pools
Combining resources to raise prices

6. Laissez-faire: Government hands off the economy!!!!

7. Answer the Essential Question
How did railroad expansion affect the United States economy?
~ Railroad expansion allowed a few powerful individuals to build great fortunes
~ It benefited coal, iron and steel industries
~ Opened up the entire United States to economic growth

8. Making Connections
How did industrialists and their companies build their fortunes?
~ By consolidating small companies into large companies
~ Offering rebates to companies shipping large amounts of goods

9. Making Connections
Do you think owners of small farms supported the rebates given by railroad companies?
~ No, because the rebates were given only to large customers and freight rates increased for small farmers.

10. Inventions Essential Questions
How did the inventions of the late 1800s revolutionize society?

11. Inventions
By 1920, Americans in cities drove cars through streets lit with electric lights. They went to department stores where they bought everything from kitchen sinks to shoes. Americans also could do their shopping by mail – or pick up the telephone and order groceries from the local store. The automobile, the electric light and the telephone were invented after 1870.

12. Inventions
Within a generation, they became part of everyday life for millions of people. These new inventions helped people communicate more quickly over long distances. Improvements in communication helped unify the country and promoted economic growth.

13. Inventions Telegraph (1844) – Samuel Morse
Operators sent messages in morse code
Offers instant communication
Connects United States and Europe

14. Inventions Telephone (1876) – Alexander Graham Bell
Businesses are first to use phones
Instant communication
Eventually telephones become common in homes

15. Inventions
Electric Light Bulb (1879) – Thomas Edison “The Wizard of Menlo Park”
Electric Power Plant
Factories, trolleys, streetlights, and lamps are powered by electricity

16. Inventions
Engine Powered Aircraft (1903) – “The Wright Brothers” Oliver and Wilbur
“Broke the bonds of Earth and see the world in a new way”
Attracted attention of United States military in 1911

17. Inventions
Wright Brothers

18. Henry Ford’s Automobile
1903 – Henry Ford established his own auto making company in Detroit, Michigan and began designing cars
1908 – Model T is introduced
Immensely popular
Affordable and easy to keep in repair
Assembly Line revolutionized industry
Mass production decreased manufacturing costs so products could be sold more cheaply

19. Model T

20. Assembly Line

21. Answer the Essential Question
How did the inventions of the late 1800s revolutionize society?

22. An Age of Big Business Essential Question
How did Americans build fortunes in the oil and steel industry?

23. Foundations of Growth
New technology and abundant natural resources led to economic growth
1859 – Edwin L. Drake strikes oil by digging a well in Titusville, PA
Led to creation of multimillion-dollar petroleum industry

24. Factors of Production
Change from an agricultural to industrial economy is possible due to the “factors of production”
Land – includes all natural resources
Labor – Rapid population growth provides more workers
Capital – Manufactured goods used to make other goods and services
Examples: machines, buildings, tools, MONEY

25. Raising Capital
Companies want to expand and to do so, need to raise capital
Became corporations by selling shares, or stock, of its business to the public
People who invest in the corporation by buying stock are its shareholders, or partial owners
Railroads were the first to form corporations

26. The Oil Business
John D. Rockefeller’s Standard Oil Company controlled the oil industry
Rockefeller created a monopoly by driving his competition out of business
Lowered prices
Pressured customers not to deal with rival companies
Convinced railroads to give him special rates
Used “horizontal integration” to help Standard Oil grow wealthy and powerful
Combined competing companies into one corporation

27. Standard Oil

28. The Steel Business
New processes for making steel created an important industry
Bessemer Process
Open hearth process
Pittsburgh, PA; Cleveland; Chicago, Detroit became important hubs in steel production

29. Andrew Carnegie 1890 – Andrew Carnegie dominates the steel industry
Company becomes powerful through “vertical integration”
Acquiring companies that provided equipment and services needed
By 1900, Carnegie Steel Company is producing 1/3 of the nation’s steel

30. Answer the Essential Question
How did Americans build fortunes in the oil and steel industries?
Formed corporations
Used methods of vertical and horizontal integration
Formed trusts and monopolies

31. Attitudes Toward Business
Industrialization and the changes associated with it caused American attitudes toward business to alter in the late 1800s.

32. Attitudes Toward Business
***The tremendous wealth some entrepreneurs gained during the late 1800s, as well as the cut-throat business methods they used, led some Americans to rethink their ideas on the meaning of business success. New philosophies tried to explain and justify both the accumulation of wealth and the practices used to achieve it.***

33. Attitudes Toward Business
Two ways people viewed business in the 19th century:
Laissez Faire
What is it?
Hands off the economy!
Social Darwinism
Survival of the fittest, only the strong survive (leads to monopolies)
How is Social Darwinism applied to business competition?
Big businesses will conquer smaller, weaker businesses

34. Attitudes Toward Business
Robber Barons vs. Philanthropists?
The philosophies described above and the growing gulf between the rich and poor led some Americans to criticize the laissez-faire policies and those who profited from them. Instead of viewing wealthy entrepreneurs as Horatio Alger heroes, critics condemned them as robber barons – steal from the poor and keep the money

35. Attitudes Toward Business
Philanthropist: Person who gives their wealth back to the community.
Example: Rockefeller Library, Carnegie Hall

36. Attitudes Toward Business
WHAT DO YOU THINK? WERE THE ENTREPRENUERS ROBBER BARONS OR PHILANTHROPISTS? WRITE ONE PARAGRAPH ANSWERING THIS QUESTION AND EXPLAIN YOUR ANSWER USING SPECIFIC EXAMPLES AND DETAILS.

37. Corporations Grow Larger
Many Americans admired the efficiencies of large business
Others argued that a lack of competition hurt consumers
No reason to improve
No reason to keep prices low
1890 – Sherman Antitrust Act
Prohibited monopolies and pools
Rarely enforced, ineffective

38. Sherman Antitrust Act
Did the Sherman Antitrust Act support competition?

39. Labor Organizations (Unions)
Business growth in the late 1800s brought generally higher wages to American workers. Yet periodic unemployment and poor working conditions remained a fact of life for workers. In addition, employers held enormous power over the lives of their workers and could lower wages and fire employees at will.

40. Labor Organizations
To improve conditions, increasing numbers of American workers formed labor unions beginning in the late 1820s. As working conditions changed with industrialization, many more workers became interested in unions.
What is collective bargaining?
Negotiating between union workers and owners

41. Labor Organizations Knights of Labor Founder: Terrence Powderly
Characteristics
Skilled/unskilled workers, women and African Americans
Reforms:
8 hour work day
End child labor
Equal opportunities for women

42. Labor Organizations American Federation of Labor (AFL)
Founder: Samuel Gompers
Characteristics
Collection of unions and skilled workers in similar trades
Reforms:
Higher wages
Better working hours
Better working conditions

43. Labor Organizations
International Ladies’ Garment Workers Union (ILGWU)
Founder: Samuel Gompers
Characteristics
Workers in cloth manufacturing industry
Sweat shops
Worked with AFL

44. Triangle Shirtwaist Factory Fire

45. Labor Conflict
If collective bargaining failed, labor unions often used strikes, or work stoppages, to achieve their aims. Strikes sometimes ended in union victories; often, however, they led to violence as business owners sought state and even federal support to end walkouts.

46. Labor Conflict Conflict What happened? Who won? Great Railroad Strike
Pay cuts
Troops sent in to end strike
Who won?
Union

47. Labor Conflict Conflict What happened? Who won?
Hay Market Riot
What happened?
Labor rally held by Chicago anarchists
First time violence is used
Who won?
No clear cut winner

48. Labor Conflict Conflict What happened? Who won? Homestead Strike
strike at Carnegie Steel plant to protest a wage cut
Who won?
Management – 75% of workers lose jobs

49. Labor Conflict Conflict? What happened? Who won? Pullman Strike
Government called in by management to put down strike
Who won?
Management