A.P. U.S.

History Notes

Chapter 25: Industry Comes of Age

~ 1865 1900 ~
I. The Iron Colt Becomes an Iron Horse 1. After the Civil War, railroad production grew enormously, from !,""" mi. of trac# laid in 1$%! to a whopping 1&',!!% mi. of trac# laid in 1&"". i. Congress gave land to railroad companies totally 1!!,!"(,&&( acres. ii. )or railroad routes, companies were allowed alternate mile*s+uare sections in chec#er,oard fashion, ,ut until companies determined which part of the land was the ,est to use for railroad ,uilding, all of the land was withheld from all other users. a. -rover Cleveland stopped this in 1$$.. '. /ailroads gave land their value0 towns where railroads ran ,ecame sprawling cities while those s#ipped ,y //1s san# into ghost towns, so o,viously, towns wanted railroads in them. 2panning the Continent with /ails 1. 3eadloc# over where to ,uild a transcontinental railroad was ,ro#en after the 2outh seceded, and in 1$%', Congress commissioned the Union Pacific Railroad to ,egin westward from 4maha, 5e,ras#a, to gold*rich California. i. The company received huge sums of money and land to ,uild its trac#s, ,ut corruption also plagued it, as the insiders of the Credit Mobilier reaped 6' million in profits. ii. 7any Irishmen, who might lay as much as 1" miles a day, laid the railroads. iii. When Indians attac#ed, trying to save their land, the Irish dropped their pic#s and sei8ed their rifles, and scores of wor#ers and Indians died during construction. '. 4ver in California, the Central Pacific Railroad was in charge of e9tending the railroad westward, an it was ,ac#ed ,y the Big Four: including Leland Stanford, the e9*governor of California who had useful political connections, and Collis P. Huntington, a adept lo,,yist. i. The Central ;acific used Chinese wor#ers, and received the same incentives as the <nion ;acific, ,ut it had to drill through the hard roc# of the 2ierra 5evada. . In 1$%&, the transcontinental rail line was completed near 4gden, <tah0 in all, the <nion ;acific ,uilt 1"$% mi. of trac#, compared to %$& mi. ,y the Central ;acific. Binding the Country with /ailroad Ties 1. Before 1&"", four other transcontinental railroads were ,uilt: i. The Northern Pacific Railroad stretched from =a#e 2uperior to the ;uget 2ound and was finished in 1$$ . ii. The Atchison, o!e"a, and Santa Fe stretched through the 2outhwest deserts and was completed the following year, in 1$$(. iii. The Southern Pacific >completed in 1$$(? went from 5ew 4rleans to 2an )rancisco. iv. The #reat Northern ran from 3uluth to 2eattle and was the creation of $a%es $. Hill, pro,a,ly the greatest railroad ,uilder of all. '. However, many pioneers over*invested on land, and the ,an#s that supported them often failed and went ,an#rupt when the land wasn1t worth as much as initially thought. /ailroad Consolidation and 7echani8ation 1. 4lder eastern railroads, li#e the Ne& 'or" Central, headed ,y Cornelius (anderbilt, often financed the successful western railroads. '. Advancement in railroad ,uilding included the steel rail, which was stronger and more enduring than the iron rail, the )estinghouse air bra"e, which increased safety, the Pull%an Palace Cars, which were lu9urious, and telegra!hs, double*rac"ing, and bloc" signals.

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i. 5evertheless, train accidents were common, as well as death. /evolution ,y /ailways 1. /ailroads stitched the nation together, generated a huge mar#et and lots of Ao,s, helped the rapid industriali8ation of America, and stimulated mining and agriculture in the West ,y ,ringing people and supplies to and from the areas were such wor# occurred. '. /ailroads helped people settle in the previously harsh -reat ;lains. . 3ue to railroads, the creation of four national ti%e +ones occurred on 5ovem,er 1$, 1$$ , instead of each city having its own time 8one >that was confusing to railroad operators?. (. /ailroads were also the ma#ers of millionaires and the millionaire class. Wrongdoing in /ailroading 1. /ailroads were not without corruption, as shown ,y the Credit 7o,ilier. '. $a, #ould made millions em,e88ling stoc#s from the -rie, .ansas Pacific, the <nion ;acific, and the e/as and Pacific railroad companies. . 4ne method of cheap moneyma#ing was called B stoc" &atering,C in which railroad companies grossly over*inflated the worth of their stoc# and sold them at huge profits. (. /ailroad owners a,used the pu,lic, ,ri,ed Audges and legislatures, employed arm*twisting lo,,yists, elected their own to political office, and used free passes to gain favor in the press. !. As time passed, though, railroad giants entered into defensive alliances to show profits, and ,egan the first of what would ,e called trusts, although at that time they were called B !ools.C -overnment Bridles the Iron Horse 1. ;eople were aware of such inAustice, ,ut were slow to com,at it. '. The #range was formed ,y farmers to com,at such corruption, and many state efforts to stop the railroad monopoly occurred, ,ut they were stopped when the 2upreme Court issued its ruling in the Wabash case, in which it ruled that states could not regulate interstate commerce. . The 0nterstate Co%%erce Act, passed in 1$$., ,anned re,ates and pools and re+uired the railroads to pu,lish their rates openly >so as not to cheat customers?, and also for,ade unfair discrimination against shippers and ,anned charging more for a short haul than for a long one. i. It also set up the 0nterstate Co%%erce Co%%ission >ICC? to enforce this. (. The act was not a victory against corporate wealth, as people li#e Richard 1lne,, a shrewd corporate lawyer, noted that they could use the act to their advantage, ,ut it did represent the first attempt ,y Congress to regulate ,usinesses for society1s interest. 7iracles of 7echani8ation 1. In 1$%", the <.2. was the (th largest manufacturer in the world, ,ut ,y 1$&(, it was D1, whyE i. 5ow*a,undant li+uid capital. ii. )ully e9ploited natural resources >li#e coal, oil, and iron, the iron from the 7innesota* =a#e 2uperior region which yielded the rich iron deposits of the Mesabi Range?. iii. 7assive immigration made la,or cheap. iv. American ingenuity played a vital role, as such inventions li#e mass production >from -li )hitne,? were ,eing refined and perfected. a. ;opular inventions included the cash register, the stoc" tic"er, the t,!e&riter, the refrigerator car, the electric d,na%o, and the electric rail&a,, which displaced animal*drawn cars. '. In 1$.%, Ale/ander #raha% Bell invented the telephone and a new age was launched. . ho%as -dison, the BWi8ard of 7enlo ;ar#,C was the most versatile inventor, who, while ,est #nown for his electric light ,ul,, also cran#ed out scores of other inventions. The Trust Titan Gmerges 1. Industry giants used various ways to eliminate competition and ma9imi8e profits. i. Andre& Carnegie used a method called B2ertical integration,C which meant that he controlled all aspects of an industry >in his case, he mined the iron, transported it, refined it, and turned it into steel, controlling all parts of the process?.

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ii. $ohn 3. Roc"efeller, master of Bhori+ontal integration,C and a giant among ,an#ers, simply allied with competitors to monopoli8e a given mar#et. a. He used this method to form Standard 1il and control the oil industry ,y forcing wea#er competitors to go ,an#rupt. '. These men ,ecame #nown for their trusts, giant, monopolistic corporations. . /oc#efeller also placed his own men on the ,oards of directors of other rival competitors, a process called Binterloc"ing directorates.C The 2upremacy of 2teel 1. In =incoln1s day, steel was very scarce and e9pensive, ,ut ,y 1&"", Americans produced as much steel as Gngland and -ermany com,ined. '. This was due to an invention that made steel*ma#ing cheaper and much more effective: the Besse%er !rocess, which was named after an Gnglish inventor even though an American, )illia% .ell,, had discovered it first: i. Cold air ,lown on red*hot iron ,urned car,on deposits and purified it. ii. America was one of the few nations that had a lot of coal for fuel, iron for smelting, and other essential ingredients for steel ma#ing, and thus, +uic#ly ,ecame D1. Carnegie and 4ther 2ultans of 2teel 1. Andrew Carnegie started off as a poor ,oy in a ,ad Ao,, ,ut ,y wor#ing hard, assuming responsi,ility, and charming influential people, he wor#ed his way up to wealth. '. He started in the ;itts,urgh area, ,ut he was not a man who li#e trusts0 still, ,ut 1&"", he was producing H of the nation1s Bessemer steel, and getting 6'! million a year. . I. ;ierpont 7organ, having already made a fortune in the ,an#ing industry and in Wall 2treet, was ready to step into the steel tu,ing industry, ,ut Carnegie threatened to ruin him, so after some tense negotiation, 7organ ,ought Carnegie1s entire ,usiness of 6("" million >this was ,efore income ta9?, ,ut Carnegie, fearing ridicule for possessing so much money, spent the rest of his life donating 6 !" million of it to charity, pensions, and li,raries. i. 7eanwhile, 7organ too# Carnegie1s holdings, added others, and launched the United States Steel Cor!oration in 1&"1, a company that ,ecame the first ,illion*dollar corporation >it was capitali8ed at 61.( ,illion? in the world. /oc#efeller -rows an American Beauty /ose 1. In 1$!&, a man named 3ra#e first used oil to get money, and ,y the 1$."s, "erosene, a type of oil, was used to light lamps all over the nation. '. However, ,y 1$$!, '!",""" of Gdison1s electric light ,ul,s were in use, and the electric industry soon rendered #erosene o,solete, Aust as #erosene had made &hale oil o,solete. . 4il, however, had its profits from the gasoline*burning internal co%bustion engine. (. Iohn 3. /oc#efeller, ruthless and merciless, organi8ed the 2tandard 4il Company of 4hio in 1$$' >five years earlier, he had already controlled &!J of all the oil refineries in the country?. !. /oc#efeller crushed wea#er competitorsKpart of the natural process according to himK,ut his company did produce superior oil at a cheaper price. %. 4ther trusts, which also generally made ,etter products at cheaper prices, emerged, such as the meat industry of #usta2us F. S&ift and Phili! Ar%our. The -ospel of Wealth 1. 7any of the newly rich had wor#ed from poverty to wealth, and thus felt that some people in the world were destined to ,ecome rich and then help society with their money. '. The /everend Russell Con&ell of ;hiladelphia ,ecame rich ,y delivering his lecture, B Acres of 3ia%ondsC thousands of times, and in it he preached that poor people made themselves poor and rich people made themselves rich0 everything was ,ecause of one1s actions only. . Corporate lawyers used the 1(th Amendment to defend trusts, the Audges agreed, saying that corporations were B,ig peopleC entitled to their property, and !lutocrac, ruled. -overnment Tac#les the Trust Gvil

1. In 1$&", the Sher%an Anti* rust Act was signed into law0 it for,ade com,inations in restraint of trade, without any distinction ,etween BgoodC and B,adC trusts. i. It proved effective ,ecause it couldn1t ,e enforced. ii. 5ot until 1&1( was it properly enforced and those prosecuted for violating the law were actually punished. F@. The 2outh in the Age of Industry 1. The 2outh remained agrarian despite all the industrial advances, though $a%es Buchanan 3u"e developed a huge cigarette industry in the form of the A%erican obacco Co%!an, and made many donations to what is now 3u#e <niversity. '. 7en li#e Henr, ). #rad,, editor of the Atlanta Constitution urged the 2outh to industriali8e. . However, many northern companies set rates to #eep the 2outh from gaining any competitive edge whatsoever, with e9amples including the rich deposits and iron and coal near Birmingham, Ala,ama, and the te9tile mills of the 2outh. (. However, cheap la,or led to the creation of many Ao,s, and despite poor wages, many white 2outherners saw employment as a ,lessing. F@I. The Impact of the 5ew Industrial /evolution on America 1. As the Industrial /evolution spread in American, the standard of living rose, immigrant swarmed to the <.2., and early Ieffersonian ideals a,out the dominance of agriculture fell. '. Women, who had swarmed to factories and had ,een encouraged ,y recent inventions, found new opportunities, and the B#ibson #irl,C created ,y Charles 3ana #ibson, ,ecame the romantic ideal of the age. i. However, many women never achieved this, and instead toiled in hard wor# ,ecause they had to do so in order to earn money. . A nation of farmers was ,ecoming a nation of wage earners, ,ut the fear of unemployment was never far, and the illness of a ,readwinner >main wage owner? in a family was disastrous. (. 2trong pressures in foreign trade developed as the tireless industrial machine threatened to flood the domestic mar#et. F@II. In <nions There Is 2trength 1. With the inflow of immigrants providing a la,or force that could wor# for low wages and in poor environments, the wor#ers who wanted to improve their conditions found that they could not, since their ,osses could easily hire the unemployed to ta#e their places. '. Corporations had many weapons against stri#ers, such as hiring stri#e,rea#ers or as#ing the courts to order stri#ers to stop stri#ing, and if they continued, to ,ring in troops0 other methods included Bloc#outsC to starve stri#ers into su,mission, and often, wor#ers had to sign Bironclad oathsC or Byellow dog contractsC which ,anned them from Aoining unions. i. Wor#ers could ,e B,lac#listed,C or put on a list and denied privileges elsewhere. . The middle*class, annoyed ,y the recurrent stri#es, grow deaf to the wor#er1s outcry. (. The view was that people li#e Carnegie and /oc#efeller had ,attled and wor#ed hard to get to the top, and wor#ers could do the same if they BreallyC wanted to improve their situations. F@III. =a,or =imps Along 1. The Civil War had put a premium on la,or, which helped la,or unions grow. '. The National Labor Union, formed in 1$%%, represented a giant ,oot stride ,y wor#ers and attracted an impressive total of %"",""" mem,ers ,ut it only lasted si9 years. i. However, it e9cluded Chinese and didn1t really try to get Blac#s and women to Aoin. ii. It wor#ed for the ar,itration of industrial disputes and the eight*hour wor#day, and won the latter for government wor#ers, ,ut the depression of 1$. #noc#ed it out. . A new organi8ation, the .nights of Labor, was ,egun in 1$%& and continued secretly until 1$$1, and this organi8ation was similar to the 5ational =a,or <nion. i. It only ,arred li+uor dealers, professional gam,lers, lawyers, ,an#ers, and stoc#,ro#ers, and they only campaigned for economic and social reform.

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ii. =ed ,y erence (. Po&derl,, the Lnights won a num,er of stri#es for the eight*hour day, and when they staged a successful stri#e against Iay -ould1s Wa,ash /ailroad in 1$$!, mem,ership mushroomed to M of a million wor#ers. <nhorsing the Lnights of =a,or 1. However, the Lnights ,ecame involved in a num,er of 7ay 3ay stri#es of which half failed. '. In Chicago, home to a,out $",""" Lnights and a few hundred anarchists that advocated a violent overthrow of the American government, tensions had ,een ,uilding, and on 7ay (, 1$$%, Chicago police were advancing on a meeting that had ,een called to protest ,rutalities ,y authorities when a dynamite ,om, was thrown, #illing or inAuring several do8en people. i. Gight anarchists were rounded up, ,ut no one could prove that they had any association with the ,om,ing, ,ut since they had preached incendiary doctrines, the Aury sentenced five of them to death on account of conspiracy and gave the other three stiff prison terms. . In 1$&', $ohn P. Altgeld, a -erman*,orn 3emocrat was elected governor of Illinois and pardoned the three survivors after studying the case e9tensively. i. He received violent ver,al a,use for that and was defeated during re*election. (. The Ha,%ar"et S4uare Bo%b forever associated the Lnights of =a,or with anarchists and lowered their popularity and effectiveness0 mem,ership declined, and those that remained fused with other la,or unions. The A) of = to the )ore 1. In 1$$%, Sa%uel #o%!ers founded the American )ederation of =a,or. i. It consisted of an association of self*governing national unions, each of which #ept its independence, with the A) of = unifying overall strategy. '. -ompers demanded a fairer share for la,or. i. All he wanted was Bmore,C and he sought ,etter wages, hours, and wor#ing conditions, ,ut he was not concerned with sweet ,y*and*,y. . The A) of = esta,lished itself on solid ,ut narrow foundations, since it tried to spea# for all wor#ers ,ut fell far short of that. i. Composed of s#illed la,orers, it was willing to let uns#illed la,orers fend for themselves, ,ut critic called it Bthe la,or trust.C (. )rom 1$$1 to 1&"", there were over ' ,""" stri#es involving %,%1",""" wor#ers with a total loss to ,oth employers and employees of a,out 6(!" million. i. ;erhaps the greatest wea#ness of la,or unions was that they only em,raced a small minorityK JKof all wor#ers. !. However, ,y 1&"", the pu,lic was starting to concede the rights of wor#ers and ,eginning to give them some or most of what they wanted. i. In 1$&(, Labor 3a, was made a legal holiday. %. A few owners were ,eginning to reali8e that losing money to fight la,or stri#es was useless, though most owners still dogmatically fought la,or unions. .. If the age of ,ig ,usiness had dawned, the age of ,ig la,or was still some distance over the hori8on.