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Unit Eight

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Unit Eight

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  1. Unit Eight The Gilded Age

  2. What does “Gilded” mean? --covered in gold or something of a golden color --Having a pleasing or showy appearance that conceals something of little worth

  3. Differences between 1860s & 1900: Wall Street in 1867 and in 1900

  4. Differences between 1860s & 1900: Population roughly doubles Immigration makes the U.S. more ethnically diverse Push for education increased literacy rate to 90% Newspapers, sports and other leisure activities became mainstream Railroad mileage increased from 35,000 to 193,000 440,000 patents were granted in the U.S. By 1900 2/3 of all workers worked for wages, rather than as farmers or other small businesses.

  5. Differences between 1860s & 1900:

  6. What enabled these changes? Massive amounts of available natural resources Growing labor supply Capital (money) plentiful due to prosperity in Europe Technology created labor-saving devices, increasing productivity Business-friendly government policies (tariffs, subsidies, court decisions, lack of regulation or heavy taxes)

  7. Big Business Three main industries were the engines of growth: Railroads Steel Oil

  8. Railroads Huge loans and grants of land given by government to encourage railroad construction 1869 saw the completion of the first transcontinental route Four more would be added (three in 1883, one in 1893)

  9. Railroads Big names in railroad: Charles Crocker Leland Stanford Cornelius Vanderbilt Later—Speculator Jay Gould

  10. Steel Industry

  11. Steel Industry Iron was used previously Bessemer process developed in 1850s—blasting hot air through molten iron created a high-quality steel Steel much more durable than iron Great Lakes region became central location for steel production—abundant coal for factories and access to iron ore in Minnesota Biggest name in steel: Andrew Carnegie

  12. Steel Industry Andrew Carnegie Scottish immigrant Began in a low railroad position; became superintendent of a Pennsylvania Railroad Quit to start a steel plant—Carnegie Steel Used latest technologies and “vertical integration” By 1900 was U.S.’s largest steel company Sold out to J.P. Morgan in 1900 – created U.S. Steel Became philanthropist of libraries, music, & more

  13. Oil Industry First U.S. oil well drilled in 1859 John D. Rockefeller founded Standard Oil in 1863 First product was kerosene Used a horizontal integration strategy Forced out competition Created a trust that controlled the market and inspired other industries to form “trusts”

  14. Laissez-Faire Capitalism Regulation, tariffs, taxes interfered with growth “Invisible hand” regulates the market—Adam Smith Social Darwinism—promoted by Herbert Spencer and William Graham Sumner

  15. Laissez-Faire Capitalism Regulation, tariffs, taxes interfered with growth “Invisible hand” regulates the market—Adam Smith Social Darwinism—promoted by Herbert Spencer and William Graham Sumner Gospel of Wealth—God approved of wealth, which came from the application of the Protestant work ethic Andrew Carnegie further believed the wealthy had an God-given obligation to help society Horatio Alger myth—author who sold more than a million books featuring rags-to-riches stories

  16. Down Side of Big Business Usual factory job required ten hours a day, six days a week Low wages did not support a family; women and children also worked Monopolies limited workers’ options Factory work was less satisfying than artisan work had been and required a much stricter structure Labor unions were nearly outlawed; protest was by quitting instead

  17. Dark Side of Big Business

  18. Dark Side of Big Business Profits would be reduced by government regulation Bribery kept elected officials out of businesses’ business Children common in factory work

  19. Dark Side of Big Business Profits would be reduced by government regulation Bribery kept elected officials out of businesses’ business Children common in factory work No safety regulations at all No compensation for accidents Workers treated harshly Unions were equated with socialism; union leaders arrested

  20. “Job Creators” or “Robber Barons”?

  21. “Job Creators” or “Robber Barons”? “What do I care about the law? H’aint I got the power?”—Cornelius Vanderbilt “The public be damned!”—William Vanderbilt

  22. “Job Creators” or “Robber Barons”? Lord Acton, British philospher, said in 1887, “Power tends to corrupt. Absolute power corrupts absolutely. Great men are almost always bad men.”

  23. “Job Creators” or “Robber Barons”? “The Bosses of the Senate”

  24. Labor and Labor Unions The late 19th century had lots of cheap labor, so management had the upper hand.

  25. Labor and Labor Unions The late 19th century had lots of cheap labor, so management had the upper hand. When treated poorly, individual workers had no power Any complaint by a worker could lead to reassignment to a worse job or firing altogether Individual workers could not make their concerns heard to management, so they tried to band together (unionize)

  26. Labor and Labor Unions

  27. Labor and Labor Unions

  28. Labor and Labor Unions What is a Labor Union? A Labor Union is an organization a worker pays a fee to join. The union negotiates: Working hours Working conditions Wages much more When the union finishes the negotiation, its members vote yes or no on the new contract.

  29. Labor and Labor Unions Important people of the 19th century Labor Movement: Terence Powderly Samuel Gompers Eugene V. Debs Important strikes and events: Great Railroad Strike of 1877 Haymarket Bombing (1886) Homestead Strike (1892) Pullman Strike (1894)

  30. Management vs. Labor “Tools” of Management “Tools” of Labor • “scabs” • P. R. campaign • Pinkertons • lockout • blacklisting • yellow-dog contracts • court injunctions • open shop • boycotts • sympathy demonstrations • informational picketing • closed shops • organized strikes • “wildcat” strikes

  31. Labor and Labor Unions Great Railroad Strike of 1877 Spread to eleven states and multiple railways

  32. Labor and Labor Unions The National Labor Union Founded in 1866 The first attempt to organize all workers in one group Main success—an 8 hour work day for government employees Influence declined with the economy in 1873 Strikes were unsuccessful in 1877

  33. Labor and Labor Unions Great Railroad Strike of 1877 Strike shut down 2/3 of U.S. track President Hayes sent troops in Over 100 people were killed Some railroads improved conditions Some railroads vowed to keep workers from organizing again

  34. Labor and Labor Unions Knights of Labor Formed by Terence Powderly (“an injury to one is a concern to all”) in 1869 as a secret organization Went public in 1881

  35. Labor and Labor Unions Goals of the Knights of Labor: Eight-hour workday. Workers’ cooperatives. Worker-owned factories. Abolition of child and prison labor. Increased circulation of greenbacks. Equal pay for men and women. Safety codes in the workplace. Prohibition of contract foreign labor. Abolition of the National Bank.

  36. Labor and Labor Unions Chicago Haymarket Bombing—1886 McCormick Harvester Factory

  37. Labor and Labor Unions Chicago Haymarket Bombing—1886 Knights of Labor organized a meeting for workers to promote its goals. It was also attended by anarchists, whose goal is to overthrow all governments An unknown person threw a bomb into the crowd, killing seven police officers Eight anarchists were executed. Knights of Labor lost influence as the public associated unions with anarchy.

  38. Labor and Labor Unions American Federation of Labor Founded in 1886 Founder: Samuel Gompers Became largest union, but not much success in 19th century

  39. Labor and Labor Unions American Federation of Labor Catered to the skilled worker. Represented workers in matters of national legislation. Maintained a national strike fund. Evangelized the cause of unionism. Prevented disputes among the many craft unions. Mediated disputes between management and labor. Pushed for closed shops.

  40. Labor and Labor Unions Homestead Strike 1892 Took place at Homestead Steel Plant near Pittsburgh (owned by Carnegie, managed by Henry Clay Frick) Wages cut by 20% Workers walked out Frick used Pinkerton guards, lockout, and strikebreakers to defeat the union Workers returned after five months Union movement in steel industry doesn’t recover until 1930s.

  41. Labor and Labor Unions Pullman Strike Pullman Company made sleeping cars for railroads

  42. Labor and Labor Unions Pullman Strike Pullman Company made sleeping cars for railroads All workers lived in the company town near Chicago

  43. Labor and Labor Unions Pullman Strike Pullman Company made sleeping cars for railroads All workers lived in the company town near Chicago George Pullman cut wages He also fired all the workers who came to bargain with him Workers at Pullman struck and asked Eugene V. Debs, head of the American Railroad Union for help

  44. Labor and Labor Unions Pullman Strike Pullman Company made sleeping cars for railroads All workers lived in the company town near Chicago George Pullman cut wages He also fired all the workers who came to bargain with him Workers at Pullman struck and asked Eugene V. Debs, head of the American Railroad Union for help ARU refused to run any trains with Pullman cars

  45. Labor and Labor Unions Railroad owners strategy:

  46. Labor and Labor Unions Railroad owners strategy: Get the U.S. mail cars to link up to trains that have Pullman cars in them

  47. Labor and Labor Unions Railroad owners strategy: Get the U.S. mail cars to link up to trains that have Pullman cars in them This got the federal government involved “If it takes an entire army and navy to deliver a postal card in Chicago, that card will be delivered!” President Grover Cleveland

  48. Labor and Labor Unions Railroad owners strategy: Get the U.S. mail cars to link up to trains that have Pullman cars in them This got the federal government involved Courts issued an injunction to stop the strike When Debs didn’t comply, he and union leaders were arrested, ending the strike. He fought this legally, but the case, In re Debs (1895), found in favor of the use of court injunctions to break strikes. Deciding that labor could never win in the American system, Debs founded the Socialist Party in 1900

  49. “Job Creators” or “Robber Barons”?

  50. “Job Creators” or “Robber Barons”? Percentage of Billionaires in 1900 by Industry