the rise of an industrial america
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The Rise of an Industrial America. 1870-1900. All in One Score . From 1880 – 1900 the US became the world’s leading industrial power Despite experiencing its industrial revolution 30-50 years after the leading powers in Europe By 1900 US manufacturing output exceeded that of:. Combined. - PowerPoint PPT PresentationTRANSCRIPT
THE RISE OF AN INDUSTRIAL AMERICA
1870-1900
All in One Score From 1880 – 1900 the US became the
world’s leading industrial power Despite experiencing its industrial revolution 30-
50 years after the leading powers in Europe
By 1900 US manufacturing output exceeded that of:
Great Britain France
Germany
Combine
d
Why was the U.S. able to make such an impact in such a short period?
Coal Iron Copper Lead
Timber
Oil
Why was the U.S. able to make such an impact in such a short period (Cont.)?
Abundant Labor Supply = Immigrants
Why was the U.S. able to make such an impact in such a short period (Cont.)?
Advanced Transportation Network – Canals and Railroads
Why was the U.S. able to make such an impact in such a short period (Cont.)?
Huge and Continually
Growing Natural Population
Why was the U.S. able to make such an impact in such a short period (Cont.)?
Why was the U.S. able to make such an impact in such a short period (Cont.)?
• Labor saving technologies and inventions
• Creation of US Patent System
Why was the U.S. able to make such an impact in such a short period (Cont.)?
Business Friendly Government Policies Such As:
Subsidizing TARIFF
Low CorporateTaxes
Laissez-Faire Policies
Why was the U.S. able to make such an impact in such a short period (Cont.)?
Talented Businessmen
Talented Businessmen Such As:
Andrew Carnegie
JD Rockefeller Andrew Mellon
JP Morgan
Andrew CarnegieCarnegie Steel Company sold to JP Morgan in 1901
and it became US Steel.Andrew Carnegie – the philanthropist $$Carnegie introduced the idea of Vertical Integration:
Controlling all steps in the production of your product – from raw materials to consumer distributionStep 1
Step 2
Step 3 Step 4
All Controlled by the company implementing
vertical integration
Example: Hamburger
Step 1: Owns the farm that
raises the cows for meat & dairy
Step 2: Owns the factories
that process the meat and dairy
Step 3: Owns the distribution
centers that transport
processed meat to markets
Step 4: Owns the fast food
restaurants that sell hamburgers
to consumers
Steel Industry Contributions
Bessemer ProcessSkyscrapers
Office buildings Desperately needed residential spaces
BridgesSubway systems
JD RockefellerCreated and ran the country’s first official
monopoly – the Standard Oil Company.Introduced the concept of horizontal
integrationControlling all of the companies that engage in
one specific step in the process of productionVertical integration Step #4: “Owns the
fast food restaurants that sell hamburgers to consumers.”
• Horizontal integration is not concerned with steps 1-3, but wants to control all of the restaurants that sell hamburgers to consumers in Step #4.
What is the object of the game?
The object of the game is to become the wealthiest player through buying, renting and
selling of property –
TO ELIMINATE THE COMPETITION
Example: Hamburger
McDonald’s: Owned & Operated by Company A
Burger King: Owned and Operated by
Company A
Wendy’s: Owned and Operated by Company A
Step #4: Owns the fast food restaurants that sell hamburgers to consumers
Company A = A TrustWhat is a trust?How do trusts operate?
What tactics are used?Are trusts and monopolies the same thing?Which still exists today –
Horizontal or Vertical Integration?Specialization
Oil Industry Contributions
The monopoly – purpose to eliminate competition
Technological advancesMany companies follow Rockefeller’s lead
Sugar, Tobacco, and Meat packing industries
Government’s Response to establishment of trusts:Laissez Faire Capitalism:
Government does not get involved in the “business of business.”
What do aliens have to do with it you ask?
Government’s Response to creation of trusts:
The idea of government regulation of business was ALIEN to those living in the 19th century. HOWEVER,
Congress did pass the Sherman Anti-Trust Act in 1890. What did it do?:
Prohibited the creation of trusts, BUT too many loopholes existed.
It was similar to:
Sherman Antitrust Act 1890
Using this cute pup as your guard dog.
Yeah we have a guard dog, but . . . . .
The Business of Railroads1865: 35,000 miles of railroad existed in the
US1900: 193,000 miles of railroad existed in
the USWhat did the ability to transport goods
nationwide encourage?companies to mass produce people to mass consume.
Building Railroads stimulated other industries.
Railroad Industry
Federal Land Grants: 80 RR companies received 170 million acres of land – WHY?RR companies ended up with ½ the available
land and after the RR was constructed the RR companies sold the land
Outrageous
Prices
Railroad Industry
Business friendly government policies and federal land grants both provided TOO MUCH incentive to would be railroad companies. AS A RESULT:
TOO MANY RR lines were laid during the late 1800s1890s were also a time of economic crisis TOO MANY RR lines combined with
economic crisis led many RR companies into bankruptcy.
All these railroads – I just can’t
compete! Now I have no
money!!!!!!!!!!!!!!!!!1
Railroad Industry
Business Friendly
Government Policies
Federal Land
Grants
Too Many RRs
Too Many RRs
1890s Economic Crisis
Bankrupt Railroads
Railroad IndustryBanks consolidated bankrupt railroads.
Railroad Industry
American Express
Inc.
• Angry Consumers & Farmers• Government Slow to Respond
Impacts of Industrialization Emergence of Department Stores & Shopping
Sears, Marshall Fields, Macy’s, Montgomery Ward Emergence of Packaged Goods Increased Standard of Living Created Sharper Class Divisions Helped the Emergence of a Middle Class
Middle Management Created an uneven distribution of wealth
10% of the population controlled 90% of the wealth 90% of the population shared 10% of the wealth
Horatio Alger Myth = “The Self-Made Man” emerges Workers worked an average 10 hour day 6 days a week Immigrants competed for jobs – consequence? Working women – types of work
Textiles, garments. Food processing, secretaries, operators, typists Labor Discontent
Skilled v Unskilled labor Dangerous working conditions Need for labor unions