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Standard 5 - Industrialization

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Adam Powley

on 16 December 2013

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Transcript of Standard 5 - Industrialization

Standard 5 - the late 19th Century
5.1
5.2
5.3
5.4
5.5
5.6
5.7
land - any resource used up to make a product
labor - workers
capital
- anything not used up to make a product (think machines, tools, factories)
technology
entrepreneurship
- someone who has a new technique or product and risks money to make a profit
all of these factors contributed to the rapid industrial growth of the late 1900s but government policy is also important
successful government provides an environment in which entrepreneurs can be successful
a misconception is that government interference hurts business and that businesses need government to be "laissez faire" (hands off) to be successful
for example, it was government that...
court decisions upheld the sanctity of contracts

even the government cannot break a contract
Supreme Court upheld Patent Laws allowing people an incentive ($) to think up new ideas
Fed Gov't regulated interstate commerce
protected infant industries with a protective tariff
removing or controlling the Native Americans who threatened to impede access to these resources
made open immigration policies made available a vast pool of workers
Business growth was promoted by the Republican Party during and after the Civil War offering subsidies to railroads and free land to settlers
Civil War contracts further stimulated the economy
Only real exception is the treatment of the Chinese
passed after the completion of the railroad when workers were no longer desired
We'll later see that this supported the interests of Big Business rather than the workers whose wages were decreased by an oversupply of immigrants
This is one of the reasons for the anger at the Chinese immigrants
Side Note: High tariffs did protect the jobs of workers but hurt consumers (because prices of goods were kept artificially high) and Unions and Wages were undermined.
Federal Government supported the expansion of international markets by expanding US territorial influence, protecting American investments abroad and that promoted open trade.
Perry opened Japan
Rise of the “Corporation”
also be called monopolies, holding companies, trusts, “management” and “Big Business”
Corporations were around before the Civil War, but become real powerful after
Remember Joint-Stock Companies raised money through the sale of stock to invest in large scale business ventures.
After the Civil War, Corporations began to have greater influence on the economy, politics and government policy.
New Industries rose to prominance
The railroad was the economic engine that drove the economy
several transcontinental routes after the Civil War united the country
promoted economic growth by developing a national market.
RRs need for steel rails, wooden railroad ties and steel railroad cars contributed to the growth of the steel, the lumber, and the coal industries
railroad brought new settlers West
provided farmers’ access to markets in the midwest were there were no natural river systems
land sales
advertising
Competition caused some railroads to be forced to merge with others to survive
Competition caused some railroads to be forced to merge with others to survive
some RR Co.s so big that when this competition forced them to bankruptcy the economy went into a depression!
Andrew Carnegie creates a STEEL EMPIRE
New Tactics
Entrepreneurs
New Technologies
The Bessemer Steel Making Process
a vertical integration
Entrepreneurs
New Technologies
New Tactics
Factors of Production contribute to economic growth
built the railroads
paid for expansion West that opened up a vast region rich in natural resources
supported “management” by Sending troops to break up strikes
Business oganization
Has legal rights of a person
Limited liability of owners
Raises revenue through sale of stock
A group of owners means perpetual life
Entrepreneurs
New Technologies
New Tactics
Basic Template to create large corporations
controlled the steel industry from the mining of iron ore and coal to the steel mill
John D. Rockefeller creates a an OIL EMPIRE
Used “dirty” tactics
Forced RRs to provide kickbacks & rebates
He got better rates which hurt competitors
Controlled retail outlets and refused to sell to competitors
Drove competition out of business by slashing pricesthen increased prices
“Let us Prey”
developed the "trust"were small oil company stockholders gave their control to a board of directors in Standard Oil Company
Horizontal Integration
Owned all of the production of one product
consolidate and eliminate competition
The Government attempted to control monopolies
The Sherman Anti-Trust Act
Concerned about the corruption of “bad” monopolies
Failed to differentiate between good and bad though
“forbade combinations in restraint of trade”
(No organizing to eliminate competition)
isn’t this what a labor union does? (yup, and smart corporate lawyers use it against them)
Too many loopholes to be effective
Industrialists had to fight a bad image that they were:
Robber-Barons
that stole from the public
Wanted to be seen as "
Captain of Industries
"
Claimed they were created with inherent talents to be successful (Social Darwinism)
Part of Social Darwinism
Based on Darwin's theory of Natural Selection, “survival of the fittest”
Rich were successful because they were better
Conversely poor had some “natural” weakness or flaw
Disregards social, cultural, legal factors
This mentality flows through all of standards 5 & 6
Carnegie claimed that since the wealthy were "created" better they had an obligation to help those less well created
Also plays into "Carnegie and the Gospel of Wealth"
Carnegie and others get into "philanthropy"
Why did the poor, "less intelligent and dirtier people” put up with this?
We will see later that they all didn’t
Unions, strikes, anti-trust acts, etc…
Carnegie was an example of rags-to-riches
Can it happen? Yes. Will it? Probably Not
Think High School Basketball player becoming next Lebron…
Contradictions of the Monopolist
Advocated laissez-faire capitalism
Government should not regulate businesses
Government should help when…
Labor unions threatened their business
They wanted tariffs to protect monopolies
Anything good happen around this time?
mass production (not assembly line yet) lowered the price of goods
From Agriculture to Industrial Economy and Issues of the American Farmer
Example
introduction of the steel plow, the mechanization of the reaper and the availability of land in the West, American farmers produced an abundance of crops
Supply increased, demand stayed the same.
Price of Crops went down.
farmers had bills to pay, but were making less money
First, each farmer acted on their own and planted more!
The more the planted the more prices fell!
Then they organized
First as "the Grange", a social group to
ease isolation of farm life
Quickly realized they should "pool" resources. Buy farm equipment at cheaper prices
They also voted as a group in order to get representatives that supported farmers issues
Who did the Farmer’s Blame?
The Railroads!
They charged high prices for transport
They gave breaks to monopolies not farmers
States passed “Granger Laws”
To regulate how much RRs could charge for storage and transport
Supreme Court (Munn v. Illinois) said states could regulate silos, but not railroads. Railroads cross state lines and it is a Federal matter
Congress passed the Interstate Commerce Act, which was weak, but the first government attempt to regulate business for the good of the people
More Boring Econ
Inflation means
More money in circulation
Money worth less because supply increased
Good for debtors (you owe $) because they pay back same amount of less valuable cash
Deflation means
Less money in circulation
Money worth more because supply decreased
Bad for debtors because the pay back same amount of more valuable cash
Who supports inflation?
Get more money for same amount of crops
They have fixed mortgages they will pay back with less valuable money
Bankers opposed inflation
Wanted money to remain valuable and would get paid back equal to what they were loaned out
Depressions in 1873, 1884, 1893 made mortgage payment on farm difficult
Farmers blamed the banks (mostly easterners)
High interest rates
Foreclosing on their properties
As Farmers lost their land they moved to the city looking for work
The local "Granges" become larger regional “Farmer’s Alliances” in 1880s
The Farmers Alliances merged into the
Populist Party
in 1890s
What do these
Populists
want?
Ecomomic Reforms
regulation of railroads
Regulation of banking
Free and unlimited coinage of silver (increased Inflation)
Overall, Populists complained of the special treatment given to businessmen
Populists tried to bring in workers by advocating an 8 hour work day and immigration restrictions
Even tried to bring in African Americans
led to stepped up Jim Crow efforts in the South
The election of 1896 saw a battle between populists and the businessmen
“soft” v. “hard” money (bimetallism v. gold)
(gold+silver v. gold)
Who will the government protect?
Bankers and businessmen? (Republicans)
farmers and laborers? (Democrat/ Populists)
Republican McKinley wins with the support of Business and Labor
They supported his "Front Porch Campaign" based on keeping the gold standard and reducing inflation
(workers) get a fixed wage and inflation would hurt their "real income"
Rise of the Labor Movement
Problems with Industrialization
boring, repetitious, dangerous
Workers seen as “cogs” in wheel of production
Management controlling huge worker populations lost personal touch with the workers
Immigrants and homeless farmers increased supply
55% of unskilled workers below poverty line ($500 dollars per year)
Unions were workers’ attempts to join together to protect themselves against these poor conditions
Family life hurt
Women and children work (Paid less)
1900 – 8 million women (17%) of labor force
1900 – 20% of boys and 17% of girls under 15 were in the work force
Death, injury, unemployment constant threats
National Labor Union
Wanted 8 hour work day
Wanted reform of political processes
No African Americans allowed
Knights of Labor
Dominated 1870s
Open to skilled and unskilled
Open to all genders and races
Undermined their unity because society and workers were bias
Preferred arbitration (compromise)
Blamed for “wildcat” walkouts and strikes
The problem with walkouts
Usually occured during time of depression and unemployment meaning increase in supply of desperate workers
management could use these desperate workers as replacements to undermined the union effectiveness
Knights declined almost overnight
Lost public support after Haymarket Square (1886)
Labor meeting in Chicago spilled into the streets to protest misuse of authorities
Police showed up
Someone threw dynamite and killed several officers
No proven KOL connection, but they were blamed and linked to anarchists

How to break a “strike”
Call in the Scabs
A-A and immigrants
Had to fight through strikers
Private security forces
“Yellow dog” contracts
Joining a union would get a worker fired
Blacklisting
Co.s in an area agree not to hire known unionizers
Get the media on your side
Blame the union for the violence
Make them think of anarchists and communists
Get the Federal Government on your side
They have armies!
Use the private property argument
For Ex. The RR strike of 1877
RRs making huge profits in 1877 but cut worker wages by 10%
After the RR workers halted much of the East Coast RR traffic, President Hayes sent in federal troops to break the Union. This led to further support and transport nationwide shut down for weeks
Over 100 people were killed
workers got none of their demands
Still, some saw power in this (they shut down the COUNTRY!)
Unions can make a difference and people join
Disunion of unskilled workers fairly easy
Ethnic and racial tensions
Play them off on each other
Native born (nativists) resented foreign born
So, promote open immigration
Gender Stereotypes
Men resented women in the workplace
Women paid less and a threat to men
Make sure the scabs are from these groups to increase these tensions
American Federation of Labor – 1890s
Skilled Labor only
More difficult to replace
Threat of strike more effective
Used collective bargaining on “bread and butter” issues
Wages, hours, condition
How effective were Unions?
Only 4% of workers by 1900
Sherman Anti-Trust act applied to Unions
Prohibits actions that commit “restraint of trade or commerce “
Union strikes restrain trade
These Unions were not Communist, Socialist or Anarchist
“A utopian society of individuals who enjoy complete freedom without government”
Also “a state of lawlessness as a result of no ruler”
Anarchists feel that gov’t is bad and hurts freedom
Communist
These groups (to various degrees) promote the failure of Capitalism
Also (to some degree) promote government or public ownership of production
The Industrial Workers of the World (IWW/“Wobblies”) were big advocates
Public did call for some government intervention after the Triangle Shirtwaist fires and for Child Labor but workers don't get a "Fair Deal" until:
Teddy Roosevelt early 1900’s Square Deal
Franklin Roosevelt 1930’s New Deal
Urbanization
First Cities were Coastal
Centers of Trade
(NY, Boston, Charleston)
2nd came
Transportation Hubs
(RRs, Canals)
Chicago, Buffalo, New Orleans
Then (with Electricity) centers of
Industry
Technology allows city to build "out" (Suspension bridges, Electric trolley, cars, subways)
& Up (Steel girders and elevators allow skyscrapers)
What caused city populations to grow?
Migration from the farms
Looking for work
Depressions and overproduction
Machinery doing work of 10 men (9 lost job)
Immigration from abroad
Looking for work and freedom
This is also where we get the great migration
African Americans move to northern cities looking for Jobs, tired of Jim Crow, fear of lynchings, Soil exhaustion and boll weevil poor cotton yield
Until 1920 most still live in rural areas
Urban Problems
Overcrowding
A lack of housing
Problems with sanitation
Not enough transportation
Bad water
Crime
fires
But they tended to be too Corrupt
"Political Machines"
used immigrant votes to secure offices
but they did take care of immigrants when no one else cared
Urban Planners thought that "City Beautiful" would help fix these issues
parks and buildings designed to awe and influence behavior
Women’s Suffrage
Westward Expansion had biggest impact
Western states first to allow suffrage
Women important as pioneers

Westward Expansion had biggest impact
Western states first to allow suffrage
Women important as pioneers
Suffrage was an 1900 issue because frustrated Middle class women
Wanted to fix problems in city and workplace
19th amendment passed in 1920 to allow women’s suffrage
argued that women would “clean up government” and help nurture society
Take care of immigrants
Fight the political bosses
Stop demon rum (liquor industry)
Immigration

Looked for a familiar culture in a strang new world.
Churches, schools, papers, businesses similar to what they were used to
Still, many urban problems relieved by political machines
Responses - Immigration Restrictions
Nativism
“Native-Born” Americans
Had immigrant roots but families had been here a few generations
Nativism a product of "market forces"
Afraid immigrants would take “Native” jobs
Would drive down wages
A Nation of Immigrants - New v. Old Immigrants
Old resented the New
so many MORE of them
so obviously different (looked different, different languages, funny clothes, strange food
Political Jealousy of Immigration
Political machines changed policy away from what the nativists wanted
White majority "needed" to limit immigration and tried to push through legislation
laws proposed in 1890s but none passed until the 1920s
Do you think the power of the industrialists could have effected this?
Social Darwinism was an effort to legitimize racism
immigrants were “less capable” of succeeding in this society
Nativist - they shouldn't come here if they can’t take care of themselves
Should not lean on political machines and ethnic neighborhoods
People like the Scottish immigrant Carnegie did it by themselves
led to Assimilation attempts
Progressives and reform
Progressivism was movement of the middle class
objected to paying taxes to corrupt city governments
wanted to instill "reform" (white middle class values)
Leaders of Reform (Progressives)
Jane Addams led the settlement house movement
Opened Chicago's Hull House:
Teach immigrants how to live in US
Vocational training
Provided childcare
American Values permeated
Advocated child labor laws
The “Muckrakers” - anyone that:
Pointed out the corruption of the political machines
Fought monopolies
Tried to show the plight of the worker
Tried to show the plight of the immigrant
Uptain Sinclair’s “The Jungle” led to the Pure Food and Drug administration
Thomas Nast’s cartoons led to the downfall of Boss Tweed
The 1st Progressive President -Teddy Roosevelt
Supported workers rights (the square deal)
Required coal mine owners to collectively bargain with workers to avoid a strike
How did Management React?
TR had an interesting relationship with business
Known as a “trust-buster”
Not really accurate. He broke up “bad” trusts.
He liked “Good” Trusts that paid a decent wage, negotiated, didn’t overcharge consumers
Enhanced the Interstate Commerce Act to control the railroads
Regulated corporations through the Sherman Anti-Trust act
Wilson continued the progressive programs
Passed the Clayton Anti-Trust Act which exempted unions from Sherman Anti-trust act
Passed the 16th Amendment
Income tax amendment
Passed the 17th Amendment
Direct Election of Senators
Provided 8 hour work days
First Workman’s Compensation plan
Not all actions were positive
He tended to racism and did little to protect minority rights
Speaking of African Americans…
They made few gains during progressivism
In fact, Jim Crow laws were used by progressives to fight political machines by keeping the poor and uneducated immigrants from voting
2 tactics for Civil Rights
Booker T. Washington
Advocated job education
Opportunities for employment
Lobbied privately (behind the scenes) for greater rights
Publically less daring

Advocated job education
Opportunities for employment
Lobbied privately (behind the scenes) for greater rights
Publically less daring
The Atlanta Compromise Speech suggested acceptance of second class citizenship and Jim Crow in exchange for jobs
Needed to “prove” they could be good citizens then they would be allowed into full citizenship
W.E.B. DuBois
The “Talented Tenth”
A-A community should promote the best and brightest
Educate them to best utilize those talents
Wanted immediate equality
Formed the NAACP
Which was more accepted by the White Majority?
Washington was (nothing had to change)
Even invited to the White House but the public outcry meant he was never invited a 2nd time
DuBois was less successful
Labeled “Militant” (too aggressive)
Did energize the African American Community
The Impact of WWI (1910) on Progressivism (started 1890s)
grain shortages and anti-German propaganda prompted the passage of the 18th amendment, establishing Prohibition
Support for women’s rights grew due to women’s efforts during the war
WWI and Labor Issues
Cooperation of Big Business and Government through the "War Industries Board" during WWI undermined unions
Stopped enforcing anti-trust laws
Stopped protecting unions from force
IWW members and socialists prosecuted for sedition during the war
WWI ended Progressivism
Wilson attempted to implement “the 14 Points” at the end of the war to end the possibility of another war
Included a League of Nations
Senate feared that it would handcuff the US to other nations and refused to accept the Treaty of Versailles ending WWI
The Treaty of Versailles was harsh on Germany
had to pay reperations
took the blame for a war it didn't start
Undermined the 14 points and the idea of progress
Progress implies things get better
WWI showed that even after 20 years of “progress” an obscene amount of life could be lost for essentially nothing
There is no “progress”
Artists reflected this sentiment
DADA movement rejected the idea that Europeans were “civilized”
DuChamp
So in the end...
Businesses regained their power during the war because of the needed to produce war items
Unions were forced to cower
Prohibition unenforceable
Women tended to vote with their Husbands
The idea that government should protect the welfare of the people evaporated
A
B
C
D
E
F
Popular government reforms
election of senators Instead of selection by state legislature
Secret ballots
Graduated income tax
A system of federal farm loans
Wanted a violentoverthrow of capitalism and public ownership of production
Socialist
like communism, but without the violence














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