Post on 11-Jan-2016
THE AGE OF INDUSTRY
1865 TO 1900
AN INTRODUCTION
BETWEEN 1865 & 1900 AMERICA WAS TRANSFORMED.
A RURAL NATION BECOMES URBAN AND INDUSTRIAL
SYMBOL OF THE AGE- THE BROOKLYN BRIDGE.
STEEL WAS THE FOUNDATION
MORE… MANY NEW INVENTIONS NEW FORMS OF BUSINESS
ORGANIZATION BIRTH OF THE ROBBER BARONS HORRIBLE WORKING
CONDITIONS
THE TIES THAT BIND. 1844 SAMUEL MORSE INVENT THE
TELEGRAPH BY 1860 EAST & WEST ARE CONNECTED.
1866 WESTERN UNION & AMERICAN TELEGRAPH MERGE.
MORE... 1858- CYRUS FIELDS - ATLANTIC
CABLE. 1866 STRONGER CABLE.
THE TELEPHONE- 1876 ALEXANDER GRAHAM BELL “WATSON I WANT YOU!”….. 1877 FIRST LONG DISTANCE
BOSTON TO NEW YORK BELL TELEPHONE COMPANY 1877 1885 AMERICAN TELEPHONE &
TELEGRAPH COMBINE
RAILROAD TRANSPORTATION SINGLE MOST IMPORTANT TIE TO
INDUSTRIAL EXPANSION. 1860- 30,000 MILES OF TRACK IN
AMERICA. NO BRIDGES OVER THE
MISSISSIPPI NO STANDARD GAGE.
RAILROAD CONSOLIDATION
1866 CORNELIUS VANDERBILT CREATES NEW YORK CENTRAL
BY 1877 VANDERBILT CONTROLS 4,500 MILES OF TRACK.
IN 1886 RAILROADS ADOPT A STANDARD GAGE.
VANDERBILT INTRODUCES STEEL RAILS & AIR BRAKES
MORE… 1883- AMERICAN RAILROAD
ASSOCIATION DIVIDES NATION INTO 4 TIME ZONES.
EASTERN, CENTRAL, MOUNTAIN, AND PACIFIC.
PERSISTENT PROBLEMS FINANCING RAILROAD
CONSTRUCTION BONDS AND STOCK CERTIFICATES-
BUT FEW ACTUAL ASSETS. CUTTHROAT COMPETITION (E.G.
BETWEEN ATLANTA & ST. LOUIS 20 DIFFERENT CARRIERS.
MORE… RATE WARS LEAD TO REBATES POOLING AGREEMENTS NOT TO
COMPETE. LONG HAUL / SHORT HAUL
ABUSES.
SOME INVENTIONS OF THE PERIOD. BETWEEN 1880 &1890 21,000 NEW
PATIENTS PER YEAR. BELL’S TELEPHONE ESTABLISHES
A WHOLE NEW INDUSTRY LEVI STRAUSS - DEVELOPES BLUE
JEANS.
STEEL PRODUCTION 1859 HENRY BESSEMER AND
WILLIAM KELLY FIND NEW METHOD OF STEEL PRODUCTION.
BESSEMER PROCESS - BLAST FURNACE
1867- U.S. PRODUCED 2000 TONS PER YEAR.
MORE… BY 1900 WE PRODUCE 7
MILLION TONS PER YEAR. STEEL BECOMES THE
BACKBONE OF THE INDUSTRIAL REVOLUTION.
SKY SCRAPERS BEGIN TO APPEAR. (20 STORIES HIGH) LUIS
SULLIVAN
INVENTIONS START MORE INDUSTRY GUSTAVUS SWIFT & PHILIP
ARMOUR - MEATBACKING INDUSTRY
GEORGE PULLMAN 1864 - INVENTS THE SLEEPING CAR.
GEORGE WESTINGHOUSE 1868 INVENTS AIR BRAKES
MORE… CHRISTOPHER SHOLES- 1875 THE
TYPEWRITER. THE THE REMINGTON FIRE ARMS COMPANY.
1852 ELISHU OTIS - INVENTS THE ELEVATOR. PERFECTED BY FRANK SPRAGUE.
THOMAS ALVA EDISON - 1847 TO 1931 “THE WIZARD OF MENLO PARK.” HELD OVER 1000 PATIENTS IMPROVED TELEGRAPH, TICKER
TAPE FOR STOCK MARKET PHONOGRAPH 1877 1879 INCANDESCENT ELECTRIC
LAMP
MORE ON EDISON... VITASOPE ( MOTION PICTURE
DEVICE) STOREAGE BATTERY, ELECTRIC
MOTOR, ELECTRIC LOCOMOTIVE 1877 FOUNDED EDISON GENERAL
ELECTRIC. LATER BECAME GENERAL ELECTRIC CORP.
BUSINESS PHILOSOPHY BY 1900 THERE WERE 4000
MILLIONAIRES RICH PRACTICES CONSPICUOUS
CONSUMPTION
ANDREW CARNEGIE’S “GOSPEL OF WEALTH” “I HAVE A RIGHT TO MAKE MONEY
& A RESPONSIBILITY TO SPEND IT PROPERLY.”
RICH ARE GOD’S STEWARTS ON EARTH.
WEALTHY MUST USE MONEY TO IMPROVE SOCIETY.
SOCIAL DARWINISM HERBERT SPENCER OF ENGLAND
APPLIES DARWINISM TO SOCIETY. WEALTHY ARE PRODUCTS OF
“NATURAL SELECTION.” WILLIAM GRAHAM SUMNER (YALE
COLLEGE) AMERICAN PROPONENT.
LAISSEZ- FAIRE ECONOMICS REJECTS GOVERNMENT INVOLEMENT IN
THE ECONOMY MARKET MECHANISM OF SUPPLY &
DEMAND IS BEST WAY TO MAKE CHOICES. COMPETITION WILL PROTECT
CONSUMERS ACCEPTED GENERALLY BY RICH AND
POOR
HORATIO ALGER.
HORATIO ALGER STORIES DIME NOVELS TELL STORY OF YOUNG
MAN WHO MAKES GOOD THROUGH HARD WORK & DETERMINATION. “LUCK & PUCK.”
“RAGGED DICK” “THE ERRAND BOY: HOW PHIL WON
SUCCESS” SUPPORTS THE AMERICAN DREAM.
NEW WAYS OF DOING BUSINESS SIZE IS HALLMARK OF THE TIME. GNP GROSS NATIONAL PRODUCT
GROWS. IN 1860 = $1.8 BILLION. BY 1890 = $10 BILLION.
AIM OF BUSINESS INCREASE PROFITS, CUT COSTS & REDUCE COMPETITION
ADVANTAGES OF CORPORATIONS LIMITED LIABILITY POOL CAPITAL LEGAL STATUS OF “PERSON”
UNDER THE 14TH AMENDMENT IMMORTAL PROFESSIONAL MANAGEMENT
CORPORATIONS DOMINATE MOST KEY INDUSTRIES.
IRON, STEEL, COAL, RAILROADS, COPPER, ELECTRICITY, TELEPHONE, TEXTILES, BANKING & CHEMICALS.
CARNEGIE AND ROCKEFELLER CARNEGIE DEVELOPS A VERTICAL
MONOPOLY IN STEEL CONTROLS ALL ASPECT OF STEEL
PRODUCTION AND SALES HE IS MODEL FOR HORATIO ALGER
STORIES. FIRST TO ADOPT BESSEMER
PROCESS.
JOHN D. ROCKEFELLER 1859- TITUSVILLE FIRST OIL WELL. OIL USED TO
MAKE KEROSENE FOR LAMPS. ROCKEFELLER SEE REFINING AND
TRANSPORTING OIL AS THE KEY. ESTABLISHES A HORIZONTAL MONOPOLY CONTROL ONE KEY STEP IN PRODUCTION
PROCESS FORMS STANDARD OIL OF OHIO IN 1870
MORE ON ROCKEFELLER… FORCES RAILROADS TO GIVE HIM
REBATES. ON HIS SHIPMENTS ALSO ON HIS COMPETITORS
SHIPMENTS. BY 1879 STANDARD OIL CONTROL
90 % OF REFINING CAPACITY.
COMPARES STANDARD OIL TO A ROSE BOTH REQUIRE EARLY SACRIFICE SLOGAN: “LET US PREY!”
TRUSTS AND MONOPOLIES INTERLOCKING DIRECTORATES HOLDING COMPANIES CONSUMERS AND WORKERS ARE
HARMED BY MONOPOLIES.