2. Resources that Fueled Industrial Growth  Coal & Iron spur industry 1870 – 77,000 tons steel 1900 – 11.4 mil. tons steel  Black Gold 1859 – Edwin Drake uses steam engine to drill for oil ○ Leads to the oil boom Petroleum-refining industry ○ Kerosene ○ Gasoline (later)  Bessemer Process Converting iron into steel  Steel is used for: Railroads Barbed wire Machines Buildings ○ Skyscrapers ○ Brooklyn Bridge

3. Inventions Bring Change Thomas Edison  Most famous inventor of time period – “The Wizard of Menlo Park”  Patents incandescent light bulb (1880)  Creates system for distributing electricity Allows plants (factories to be located anywhere Used in industry and homes to run machines and appliances  Phonograph  Motion picture Kinetoscope  Typewriter Christopher Sholes (1867)  Telephone Alexander Graham Bell & Thomas Watson (1876) ○ By 1900 – 800,000 telephones in U.S.

4. THE GROWTH OF BIG BUSINESS Cornelius Vanderbilt “The Commodore”  Gained early wealth through the shipping industry  Following the Civil War Sells ships and invests in the railroad New York Central – ran from Albany to Buffalo  Became railroad tycoon; Self-made multi-millionaire Worth over $100 million at his death

5. The Growth of Big Business cont’d  Andrew Carnegie Searches for ways to make better products more cheaply Gains control of almost entire steel industry ○ Carnegie Steel Company  John D. Rockefeller Founded Standard Oil Company By 1879 – controlled 90% of U.S. refining of oil Vertical integration Buy out suppliers to control materials Horizontal integration Merging with competing companies

6. Social Darwinism  Grew from idea of Charles Darwin Biological evolution “survival of the fittest”  Concept applied to businesses No govt. interference ○ Laissez-faire economics Trusts (monopolies) developed

7. Growth of Big Business cont’d  John D. Rockefeller Forms nations first monopoly (trust) ○ Allowed for control of production, wages, and prices  “Robber Barons” Rockefeller profits by paying low wages and underselling others Once competition was eliminated, prices went up Critics called such industrialists “robber barons”  Sherman Antitrust Act Government concerned about free competition Trusts viewed as illegal if interfering with free trade ○ Prosecution of companies was too difficult

8. Labor Unions Emerge  Lack of organization of laborers Cigar makers Printers Carpenters  Issues Unsafe factories Low wages Long working hours ○ 12 hour days ○ 6 day work weeks  Early Labor Organizations: National Labor Union ○ 1 st large-scale national organization ○ 1868 – worked for 8 hour workday Knights of Labor ○ Open to women, African Americans, immigrants and unskilled workers Demanded an 8 hour workday Supported equal pay ○ Violent strikes led union to dissolve

9. Labor Unions cont’d  American Federation of Labor (AFL) Founded by Samuel Gompers Used collective bargaining to get better: ○ Wages ○ Hours ○ Conditions Use of “strikes” 1886 – 150,000 members 1900 – over 1 million  American Railway Union Mostly unskilled workers Headed by Eugene V. Debs ○ “the strike is the weapon of the oppressed”  Industrial Workers of the World (IWW) Called “wobblies” Radical unionists and socialists

10. Strikes Lead to Violence “The Battle of Homestead”  Homestead Strike Carnegie’s steel plant ○ Homestead, Penn. ○ Organized wage cuts Managers hired “scabs” (strikebreakers) to work Homestead workers organized ○ Management hired Pinkerton Detective Agents to end strike Protests and violence led to over 8,500 National Guard being called in

11. Company cut wages by 25% ○ No adjustment to living expenses American Railway Union (ARU) ○ Eugene Debs tries to negotiate with Pullman Boycott of trains Strike turns violent and federal troops are sent by President Cleveland Debs is jailed Striking workers “blacklisted” THE PULLMAN STRIKE