• Read Chapter 6 Section 1 – 15 minutes
• Create a visual chart demonstrating the innovation,
person responsible for that innovation and how it
• On the back of the chart predict how industrialism
might affect the American economy, large cities and
Americans in general.
Located on a hill near
Patillo Higgins persuaded
Capt. Anthony Lucas to work
They found investors and
began to drill.
1/10/-1901 – they struck oil!
The Texas oil boom had
The Expansion of Industry
• After 1865, the U.S.
was still largely an
• By 1920, the U.S. was
the leading industrial
power in the world
• This enormous growth
was due to three
• 1) Natural Resources
• 2) Governmental
support for businesses.
• 3) Urbanization
• 1859 – Edwin Drake
– Used a steam engine to drill
– This started the oil boom in
the Midwest and later Texas.
– 1st process turned oil into
kerosene and gasoline, the
by-product was thrown away.
– Later, when cars became
popular, gas becomes the
most important part.
Bessemer Steel Process
• Invented by Henry
Bessemer and William
• Manufacturing process
of removing carbon and
other impurities from
New Uses For Steel
• The railroads, with
thousands of miles of
track, were the biggest
customers for steel
Other uses emerged:
(Brooklyn Bridge- 1883)
the first skyscrapers
Home Insurance Building in Chicago
The Power of
•Thomas Alva Edison
world’s first research
•By 1890, electricity
• Christopher Sholes
• invented the typewriter in
• His invention forever
affected office work and
• It also opened many new
jobs for women
• 1870: Women made up less
than 5% of workforce 1910
Alexander Graham Bell/Thomas
• Invented the telephone
• Created new jobs for
• Make a chart/poster about how industry
changed the environment.
• Give 3 examples
• 10 minutes
The Age of Railroads
• A National Network –
– By 1869 they were transcontinental
– They brought Americans dreams of available
land, adventure, and a fresh start.
– Made possible only by harsh lives of rr workers
- 2000 killed and 20,000 injured while laying track.
• Each community still operated on its own time
and travelers might have to reset their
watches 20 times from California to Maine.
• Professor C. F. Dowd proposed that the earth’s
surface be divided into 24 time zones.
– One for each hour of the day.
• Under his plan, the US would have 4 zones:
• Railroads endorsed the plan and many towns
• 1884 – international conference set world wide
time zones that incorporated railroad time.
• 1918 – the US Congress adopted the time
zone as a standard for the nation.
THE UNITED STATES IS DIVIDED INTO 4 TIME ZONES
Opportunities and Opportunists
• Growth of railroads influenced industries and
– Iron, coal, steel, lumber, and glass
• Fostered growth of towns
• Established new markets
• Offered rich opportunities for visionaries and
New Towns and Markets
• Individual towns began to specialize in products
– Chicago – stockyards
– Minneapolis – grain industries
Owed their existence to railroads
• George M. Pullman
– Built a factory for manufacturing sleepers and
other railroad cars on the Illinois prairie.
• Built a nearby town for his employees that supplied
almost all of the worker’s needs.
• Drawback – town was under company control
• He cut employee’s pay eventually and would not lower
• This led to a violent strike in 1894
• Pullman wanted control and profit
• Stockholders of the Union Pacific formed a
construction company called the Credit
– They gave the company contracts to lay track at 2-
3 times the actual cost and pocketed the profits.
• They donated some of their profits to representatives
in Congress in 1867
• Congressional investigation of the company
found that the officers had taken up to $23
million in stocks, bonds, and cash.
– Testimony implicated VP Colfax, Congressman
– Public figures were allowed to keep their profits
and were not really punished.
– Republican party was tarnished.
The Grange and the Railroads
• Farmers were disturbed by railroad corruption
• The Grangers demanded government control
over the railroad industry
• Farmers were angry because of:
– Misuse of govt. land grants
• The railroads were selling land to other businesses
instead of settlers.
– Railroads were fixing prices keeping farmers in
– Charged different customers different rates
• Grangers sponsored state and local political
candidates, elected legislators, and pressed
for laws to protect their interests.
• 1871 – Illinois authorized a commission to
establish rates and prohibit discrimination.
• Similar laws were passed in other states.
These laws were called Granger laws.
Railroads Fought Back
– They challenged the constitutionality of the
– 1877 – Case of Munn v. Illinois, the Supreme
Court upheld the Granger Laws.
• The states won the rights to regulate railroads for the
benefit of farmers and consumers.
– The Grangers helped to establish and important
principle – the govt.’s rights to regulate private
industry to serve the public interest.
Interstate Commerce Act
• 1886 – Supreme Court ruled that a state could
not set rates on interstate commerce.
• Congress passed the Interstate Commerce Act
in 1887 – established the right of the federal
government to supervise railroad activities
and established a five-member Interstate
Commerce Commission for that purpose.
• ICC – had difficulty regulating railroad rates
because of the legal process and resistance
from the railroads.
• 1897 – final blow came when the Supreme
Court ruled that it could not set maximum
Panic and Consolidation
• Bankruptcy caused by:
– Corporate abuses
• Their financial problems influenced the
nationwide economic collapse.
• 1894 – ¼ of the nation’s railroads had been
taken over by financial institutions.
• Large investment firms reorganized the
• 7 powerful companies held power over 2/3 of
the nation’s tracks.
• Born penniless in Scotland
• Came to US at age 12 and worked his way up
• Made his own fortune through investments
• Supported charities
• Model of the American success story
• 1865 left his job at Pennsylvania Railroad
• 1873 entered the steel business
• 1899 – Carnegie Steel Company manufactured
more steel than all the factories in Great
New Business Strategies
• 1. Looked for ways to make better products
– incorporated machinery and techniques to help
him track costs.
2. Attracted talented people by offering them
stock in the company and encouraged
competition among his assistants.
• Attempted to control the steel market.
– Vertical integration – he bought out his suppliers.
– Horizontal integration – he attempted to buy out
Social Darwinism and Business
• Principles of Social Darwinism –
– Herbert Spencer – English philosopher, used
Darwin’s theory to explain the evolution of
• This theory supports the idea that the marketplace
should not be regulated.
A New Definition of Success
• According to Social Darwinism-
– Riches were a sign of God’s favor, and the poor
must be lazy or inferior people who deserved their
lot in life.
BUSINESS GROWTH &
• Mergers could result in a
• A monopoly is complete
control over an industry
• An example of
consolidation: In 1870,
Rockefeller Standard Oil
Company owned 2% of
the country’s crude oil
• By 1880 – it controlled
90% of U.S. crude oil CHICAGO’S STANDARD OIL BUILDING IS ONE
OF THE WORLD’S TALLEST
Fewer Control More
• Holding company – bought out stock of other
• J.P. Morgan – banker
– Head of holding company United States Steel
– Bought Carnegie Steel in 1901 to become one of
the world’s largest businesses.
Standard Oil Company
• Owned by John D. Rockerfeller
• Joined with competing companies in trust
• Participants in a trust turned their stock over
• Companies were entitled to dividends on
profits earned by the trust.
• NOT LEGAL MERGERS
• Paid employees low
• Drove his competition
out of business by selling
his oil at a lower price
than it cost to produce it.
• When he controlled the
market, he hiked prices
far above original levels.
• Alarmed at the cut-
throat tactics of
began to call them
• Famous “Robber
and J.P. Morgan
Rockerfeller kept most of his
profits, but he gave away
Established the Rockerfeller
Providing funds to found the
University of Chicago
Created a medical institute that
helped find a cure for yellow
Donated 90% of the wealth
he accumulated during his
His fortune still supports the
“It will be a great mistake for
the community to shoot the
millionaires, for they are the
bees that make the most
honey, and contribute most to
the hive even after they have
gorged themselves full.”
Sherman’s Antitrust Act
• Made it illegal to form a
trust that interfered
with free trade between
states or with other
• Difficult to prosecute
• 7/8 cases were thrown
out of court.
Business Bypasses the South
• After the war, the North
continued to grow
financially, but the
South was still
• South – mostly farmers
– At will of RR rates
– High tariffs
– Unskilled workers
• Hope for South –
– Textile industry
WORKERS HAD POOR
• Worked 6 – 7 days a
• 12 + hour days
– vacation, sick pay,
– Worker’s compensation
• Injuries were common
– In 1882, an average of
675 workers were killed
PER WEEK on the job
• Wages were so low that
a family could not
survive unless everyone
had a job.
• Women and children
Worked in sweatshops
and were forced to
accept their working
• Child – 14 hour day
• Women $267.00 year
• Men - $498.00/year
LABOR UNIONS EMERGE
• As conditions for
realized they needed to
• The first large-scale
national organization of
workers was the National
Labor Union in 1866
• The Colored National
Labor Union followed
• NLU – persuaded
legalize an 8 hour
work day for govt.
• Uriah Stephens –
Noble Order of
the Knights of
– Open to all
– Supported 8 hour
– Equal pay equal
• Craft Unions were unions of
workers in a skilled trade
• Samuel Gompers led the Cigar
Makers’ International Union to
join with other craft unions in
• Gompers became president of
the American Federation of
• He focused on collective
bargaining to improve
conditions, wages and hours
• Some unions were
formed with workers
within a specific industry
• Eugene Debs attempted
this type of industrial
union with the railway
workers forming the
• In 1894, the new union
won a strike for higher
wages and at its peak had
150,000 membersEUGENE DEBS
SOCIALISM AND THE IWW
• Some unionists (including
Debs) turned to a socialism
– an economic and political
system based on government
control of business and
property and an equal
distribution of wealth among
• The International Workers of
the World (IWW) or Wobblies,
was one such socialist union
FOR THE IWW
STRIKES TURN VIOLENT
• Several strikes turned
deadly in the late 19th
century as workers and
• The Great Strike of 1877:
Workers for the Baltimore
and Ohio Railroad struck to
protest wage cuts
• Other rail workers across
the country struck in
• Federal troops were called
in to end the strike
THE HAYMARKET AFFAIR
• Labor leaders continued to push for
• May 4, 1886 - 3,000 people gathered
at Chicago’s Haymarket Square to
protest police treatment of striking
• A bomb exploded near the police line –
killing 7 cops and several workers.
• Radicals were
• 8 convicted – 4
hanged and 1
THE HOMESTEAD STRIKE
• June 29, 1892 – Steel workers called a strike
after the president of the company
announced wage cuts.
• Frick hired Pinkerton Detectives to guard the plant
and allow scabs to work and keep the company
• Detectives and strikers clashed – 3 detectives and 9 strikers died
• Steelworkers forced out the Pinkertons and kept the plant closed until
the National guard restored order
workers returned to work in November
• ARU began boycotting
• Pullman hired
strikebreakers and the
strike turned violent.
• Pres. Grover Cleveland
sent in federal troops.
• Eugene Debs was
• Pullman fired most of
the railroad workers
and they were
blacklisted and could
never get railroad jobs
• Although women were barred
from most unions, they did
organize behind powerful
leaders such as Mary Harris
• She organized the United Mine
Workers of America
• Mine workers gave her the
nickname, “Mother Jones”
What Women Wanted
• Women wanted:
– Better working conditions
– Equal pay for equal work
– End to child labor
• Garment worker since 8
yrs of age.
• 1st female organizer of
the International Ladies
Triangle Shirtwaist Fire
• March 5, 1911
• Fire spread through the 8th, 9th, and 10th floors.
• Company had locked all but one exit door to
• The unlocked door was blocked by fire.
• Single fire escape collapsed.
• 146 women died
• Public outrage flared when a jury acquitted
the factory owners of manslaughter.
WEAVE ROOM BLUES
Working in a weave-room, fighting for my life
Trying to make a living for my kiddies and my wife
Some are needing clothing and some are needing shoes
But I'm getting nothing for them but the weave-room blues
I got the blues, I got the blues
I got them awful weave-room blues
I got the blues, the weave-room blues
With your looms a-slamming, shuttles bouncing on the floor
And when you flag your fixer, you can see that he is sore
I'm trying to make a living, but I think that I will lose
Cause I'm getting nothing but those weave-room blues
The harness eyes are breaking and the doubles coming through
The devil's in your alley and he's coming after you
Our hearts are aching, let us take a little snooze
For we're simply dying with them weave-room blues
Slam outs, break outs, knot ups by the score
Cloth all rolled back and piled up on the floor
The bats are running ends, the strings are hanging to your shoes
We're simply dying with them weave-room blues
EMPLOYERS FIGHT UNIONS
• The more powerful the unions became, the more
employers came to fear them
• Employers often forbade union meetings and refused to
• Employers forced new workers to sign “Yellow Dog
Contracts,” swearing that they would never join a union
• Despite those efforts, the AFL had over 2 million
members by 1914