Ch 9 Notes
American History
Sec 1
Industrialization- switch from farming to industry
Why? 1. Lots of natural resources- coal, iron= steel, copper = wire, oil = heat
2. workforce- large families, migration, freed slaves
- large workforce = cheap
3. inventions- help make stuff quicker/cheaper
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light bulb- work at night,
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telephone-
4. Economy- lots of $ available to invest in north after war
- many people made $ during the war selling to govt
5 Government encouragement
Free enterprise- laissez faire- leave it alone, gov’t not involved in business
- competition/supply/demand will drive prices
Gov’t- encouraged business
- subsidies- payment to business, for RR’s and others
- tariffs- protect domestic goods, hurts exporters however
sec 2
Transcontinental RR- finished 1869
- Irish/Chinese major employees
- Other lines connect to it, spread out (Vanderbilt = RR baron)
More efficient- time zones- people know when train will get there
Air brakes- stop faster than by hand
Steel rails- carry heavier load faster w/o breaking track
Land Grants- gov’t gave to RR’s, later sold it and made tons of $
- also given to colleges
Sec 3
Corporations- business owned by many people
- sells- stock- shares in a business
§ raises money for business short term, spreads out risk
§ shareholders get dividends- % of profits
Fixed costs- taxes, loans, rent
Operating costs- wages, shipping, materials
- small businesses have low fixed costs, but relatively high operating costs, shut down during slow times
- Big Business- keep running during slow times, buy in bulk, ship in bulk (cheaper rates)
Pools- several businesses agree to hold prices at a certain level
- generally fell apart when stabbed in the back
Bessemer process- way to make steel faster/cheaper, becomes material of choice
- Carnegie becomes major player in steel industry
Vertical integration- own all aspects of making a product, mining to refining
- Carnegie bought the iron mines, had deals with RRs, processed the steel himself and sold it himself
Horizontal integration- take over one entire aspect of an industry
- Rockefeller took over all oil refineries
Monopoly- one company has total control in one area
- can charge whatever price it wants= no competition
laws are passed preventing companies from owning stock in other companies result=
Trusts- stockholders give stock to “trustees” to manage it (Standard Oil)
Holding companies- super companies that manage stock of other companies, that is their only job
Advertising- increases, need to show differences in products
Department stores- everything under one roof, great variety, famous = Macey’s
Chain stores- # of stores in different areas, buy products in bulk = cheaper prices (Woolworth’s)
Mail order- sell to people in rural areas, cities, delivered to them (Sears)
Sec 4
Problems- dirty/unsafe conditions, low wages, benefits, child labor
Inflation- $ loses value, wages stay the same, prices go up
- buying power of wages goes down
Early Unions- trade unions- people that have a specific skill (plumbers, carpenters)
- industrial unions- all craft workers, skilled/unskilled
Prevent Unionization- fire union leaders
- organizers- blacklisted- no more jobs in area
- lockout- prevent workers from working
- strikes- hire strikebreakers
Roots- Karl Marx, communism
- workers must unify to overthrow the wealthy who hold them down
- eventually overthrow the government, all private property confiscated
- causes negative perceptions of unions among middle/upper classes
- anarchism- no gov’t, violence needed to topple gov’t
- immigrants- spread these European ideas
RR Strike of 1877- strikers shut down most rr lines
- violence breaks out, Pres calls in troops to break strike
Knights of Labor- goal- to become 1st national union
- equal pay for women, no child labor
- worker owned factories
- 8 hr workday
- rather use boycotts instead of strikes
- supported arbitration- use a 3rd party to settle disputes
Haymarket Riot- Chicago strike/protest
- large crowd, large police presence
- bomb goes off, 7 cops killed, 4 workers
- blame= KofL, result- lose popularity
Pullman Strike- people make
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people that work on RRs with
- RR halted, troops sent in “to get the mail running”
AFL- not be political, not so radical
- wanted companies to recognize the right of a union to negotiate for its members (collective bargaining)
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advocated closed shops- companies only hire union
workers