Following the Civil War, a population boom coupled with rebuilding efforts propelled the nation to become the world’s preeminent industrial power. This era was known as the Second Industrial Revolution; the first had occurred in Great Britain in the late eighteenth century. The era was marked by the introduction of the coal steam engine, the textile machine, and the blast furnace for producing iron.The first industries to represent “Big Business” were railroads, linking the western half of the continent to the economic development capabilities of the east. The Central Pacific Railroad, working east from Sacramento, California , and the Union Pacific, working west from Omaha, Nebraska, built the first transcontinental railroad, meeting in 1865 at Promontory, Utah.
Railroads were constructed by private companies, which raised the necessary funds by selling bonds. Originally, concerns about the constitutionality of federal involvement in financing railroads precluded the government from becoming involved in their construction, but beginning in the 1850s, schemes that provided federal land to the builders were approved.The growth of manufacturing after the Civil War sparked an innovative streak in Americans, resulting in inventions such as barbed wire, refrigerated box cars, airbrakes for trains, and the telephone.
What was the route of the first transcontinental railroad, and why was it not in the South? Who built the railroads? How were they financed?
Andrew Carnegie Steel magnate and business icon.
Carnegie’s empire The huge Carnegie steel plant at Homestead, Pennsylvania.
Morgan, an investment banker, bought large amounts of stock in corporations, and then in turn sold them for a profit. He also bought rival firms that were in trouble, fixed them, and resold them. In 1890, he controlled one-sixth of the nation’s railroads. Richard Sears and Alvah Roebuck opened a mail-order company in the 1890s. By eliminating the middleman, they could ship goods from a catalog to people throughout the United States.
Cover of the 1897 Sears, Roebuck and Company catalog Sears, Roebuck’s extensive mail-order business and discounted prices allowed its many products to reach customers in cities and in the backcountry.
J. Pierpont Morgan Morgan is shown here in a famous 1903 portrait by Edward Steichen.
The rise of business A lavish dinner celebrated the merger of the Carnegie and Morgan interests in 1901. The shape of the table is meant to symbolize a rail.
Children in industry Four young boys who did the dangerous work of mine helpers in West Virginia in 1900.
The first forms of protest against labor conditions were disorganized, as many of the workers in these conditions were recent immigrants or farmers not familiar with the idea of civilized protests. A group of Irish-American coalminers, the Molly Maguires, used violence to achieve better working conditions in Pennsylvania coalmines. Eventually, twenty-four members of this group were convicted of murder and kidnapping, and ten were hanged.
The Railroad Strike of 1877, the first interstate strike in American history, resulted from the financial panic of 1873, during which railroad companies drastically cut wages. The strike eventually erupted in violence, and order was restored when federal troops intervened. At a sandlot in San Francisco, a meeting to show support for the striking railroad workers became an attack on Chinese immigrants. The Chinese were easy scapegoats, as they tended to work for less and were perceived to steal American jobs.
Denis Kearney This cartoon shows support for Denis Kearney, who organized the Workingmen’s Party of California, and his Chinese labor exclusion policy.
In 1866, the National Labor Union was founded, comprising labor and reform groups more interested in political and social reforms than in collective bargaining. Before disbanding in 1873, the NLU secured the Contract Labor Act, which encouraged employers to import workers by paying passage. Led by Uriah Smith Stephens, the Knights of Labor was a secret organization designed to protect its members from retaliation from employers. Its members, which numbered in the hundreds of thousands at its peak, allowed skilled and unskilled laborers to join.
Members of the Knights of Labor This national union was more egalitarian than most of its contemporaries.
Anarchists believe that any form of government is abusive, controlled by the rich to exploit the poor. Many labor unions during the late nineteenth century pushed for the abolition of government to achieve their goals. At an 1886 Knights of Labor rally in Chicago’s Haymarket Square to promote the eight-hour workday, a bomb was thrown into a crowd of police officers. One officer was killed and several others were wounded. Although no one involved with the Knights was found guilty in this affair, they were guilty by association, and soon thereafter its membership dwindled.
The Haymarket Affair A priest gives last rites to a policeman after anarchist-labor violence erupts in Haymarket Square, Chicago.
In 1886, twenty-five skilled workers organizations joined to create the American Federation of Labor (AFL). Led by Samuel Gompers, the AFL allowed only skilled workers as their members, and very gradually emerged as the preeminent union in the United States. In 1892, the Amalgamated Association of Iron and Steel Workers went on strike at Carnegie’s Homestead Works near Pittsburgh. An attempt to break the strike ended in bloodshed when members of the Pinkerton Detective Agency were brought in to confront the strikers. Eventually, state militias were sent in to protect workers not involved in the strike.
The Pullman Strike paralyzed the economies of twenty-seven states in 1894. Members of the American Railway Union (ARU) working at the Pullman Palace Car Company went on strike. No member of the ARU would handle Pullman railcars, sleeper cars that were very popular. By mid July, Midwest railway lines were stuck with cars on tracks that no one would touch. Eventually, President Cleveland ordered federal troops to remove the cars from the tracks, citing federal authority to deliver the mail, which at that time was done by train. Mary Jones (1837-1930), the self-declared mother of the labor movement, promoted higher wages, shorter hours, safer workplaces, and child labor restrictions. Although she lost most of the strikes in which she participated, she lived to see her views become accepted by unions across the country.
The Pullman strike Troops guarding the railroads, 1894.
Socialism, a movement to abolish the government and to turn the method of production over to the people, first came to the United States in the 1820s. It began to gain a strong following in the 1870s, when Karl Marx moved his union headquarters to New York. Eventually, the Socialist Party of America was created, with its leader, Eugene Debs, running for president. The Wobblies, or the Industrial Workers of the World, was an attempt to revive industrial unionism. More successful at violence than achieving their goals, they included both skilled and unskilled workers in their membership. Split by internal factions, the Wobblies eventually disbanded after a failed strike in 1912.
1. Chapter 18
• What fueled the growth of the post Civil War economy?
• What is “Big Business”?
• What were the social and political consequences of the rise of Big Business?
3. Corporations and the 2nd Industrial Revolution
• Businesses grew as a result of rapid expansion of technology, population,
• As businesses grew, owners sought to integrate all the processes of production and
distribution of goods into single companies
• Mergers with competitors were an effort to dominate entire industries and limit
4. Convergence and Economic Growth
• Natural resources: forests; minerals; rivers
• Rapidly expanding population: immigration
• Development of more efficient and labor-saving technology
• Government : tariffs, providing land and cash, little, if any, regulation of business activity,
• 1868 NewYork state legislature legalized bribery of politicians
5. Advances in Agriculture
• By 1870 US was the world leader in production of wheat and corn
• Commercial cattle industry
• Slaughter and Meat packing
6. Major Catalysts of the 2nd Industrial Revolution
• Creation of interconnected transportation and communication networks
• RR andTelephone/Telegraph
• By 1880 widespread application of electrical power
• Industrial machinery
• Trolleys and subways
• Production of steel and chemicals
• Systematic application of scientific research to industrial processes
• Refining of crude oil into kerosene and gasoline
• Inventions of new products
7. The Rise of Big Business
• First industries to represent big business
• Building the Transcontinentals
• Central Pacific RR: East from Sacramento
• Hired between 12,00-14,000 Chinese laborers who came to US in search of gold
• Union Pacific RR: West from Omaha
• 1865 Promontory Utah
8. May 10th 1889
Central Pacific Railroad workers
9. The Rise of Big Business
• Financing the Railroads
• Railroads constructed by private companies who raised the funds by selling
• By 1850’w schemes that provided federal land to the RR companies were
approved by Congress
• Inventions Spur Manufacturing
• Barbed wire, refrigerated box cars
• The telephone
10. The Rise of Big Business
Route ofTranscontinental RR Questions
• Why was the transcontinental RR not in the
• Why should government get involved in
helping private businesses?
11. Government Subsidies, Corruption and Big
• Tammany Hall: Society of St.Tammany-- 1786 Democratic Party political
machine that controlled NewYorkCity from 1854-1932
• BossTweed ran the 7th ward in NYC forTammany Hall
• Political patronage
• Irish Immigrant population
12. Railroad & Business Entrepreneurs
aka “Robber Barons”
• Jay Gould: involved in a number of businesses and the BossTweed ring in
NewYork City. Owned the Erie Railroad with Jay Fiske and put BossTweed
on the board of directors. Posted 1 million bail for bossTweed after he was
arrested for corruption. 9th richest man in U.S. history. Controlled over
10,000 miles of railroads. Attempted to corner the gold market.
• J. P. Morgan, Financier: investment banker
• Sears and Roebuck: Richard Sears and Alvah Roebuck—mail order
19. The Working Class
20. The Working Class
• Disorganized Protest
• The Molly Maguires
21. The Working Class
• The Railroad Strike of 1877
• 1st Interstate Strike
• Financial panic of 1873
• Federal troops
• The Sand-Lot Incident
• Meeting to show support for RR strike turned into an attack on Chinese immigrants
• Anti-Chinese Agitation
• Chinese worked for less and perceived to steal American jobs
• Dennis Kearney and “foreign peril”
• 1882: Congress prohibited Chinese immigration for 10 years
22. The Working Class
23. The Working Class
• Toward Permanent Unions
• 1866 National Labor Union
• Contract Labor Act
• Employers to import employees by paying passage
• The Knights of Labor
• Protect workers from retaliation
• Hundreds of thousands of workers were members
24. The Working Class
25. The Working Class
• Any form of government limits individual freedom and is abusive
• The Haymarket Affair
• 1886 Knights of Labor rally in Chicago
• Bomb thrown into a group of police officers
• Undermined the Knights of Labor though no one found guilty of incident
26. The Working Class
27. The Working Class
• Gompers and the AFL
• 1886 25 skilled workers organizations created the
American Federation of Labor
• Samuel Gompers
• The Homestead Strike
• 1892 Amalgamated Association of Iron and Steel
Workers went on strike at Carnegie’s Homestead
Works near Pittsburgh
• An attempt to break the strike ended in bloodshed
when members of the Pinkerton DetectiveAgency
• state militias were sent in to protect workers not
involved in the strike.
28. Black Pullman Porters Union
Pullman cars: hotels on wheels
Pullman hired only African American men as porters
Porters required to work 400 hours per month or 11,000
miles— to receive full pay.
Porters depended on passengers' tips to earn a decent
level of pay. Tips > monthly salary earned from the
High social prestige in African American Community
Thurgood Marshall’s father was a Pullman porter
29. The Working Class
• The Pullman Strike
• 1894: American RR Worker’s Union refused to handle Pullman cars
• 27 states affected
• Entire RR lines brought to halt
• President Grover Cleveland ordered federal troops to remove cars from tracks citing Federal authority to deliver
• Mother Jones (1837-1930)
• Self-declared mother of the labor movement
• Higher wages
• Shorter hours, safer workplaces
• Child labor restrictions
30. The Working Class
31. The Working Class
• Socialism and the Unions
• Eugene V. Debs
• The Wobblies
32. Photos Used in this Presentation
• Wikipedia Commons
• Courtesy of Amon Carter Museum, Fort WorthTexas
• Courtesy of Union Pacific Historical Collection
• Harper’sWeekly Election Cartoons
• A Philip Randolph Museum: Brotherhood of Sleeping Car Porters