The Expansion of American

Industry
Chapter 13
Rhyann, Cheyenne, Cory
 Section 1 – A Technological Revolution
• Indoor electric lighting did not exist in 1865.
• After dark, people lit candles or oil lamps if they could afford them, used ice sawed out of frozen
ponds for refrigeration in the summer, and long-distance communication took at least 10 days to 3
weeks to arrive by mail.
• Post-Civil War years saw tremendous growth in inventions.
• Between 1790 and 1860, the Patent and Trademark Office of the federal government issued just
36,000 patents.
• Patents—licenses that give an inventor the exclusive right to make, use, or sell an invention for a set
period.
• The combination of financial backing and American ingenuity helped create new industries and
expand old ones.
• By 1900, Americans’ standard of living was among the highest in the world.
• The achievement was a result of the nation’s growing industrial productivity—the amount of goods
and services created in a given period of time. 
• New forms of energy led to many important advances in the nation’s industrial development and changed
people’s eating working, and even sleeping habits.
• 1858, the Pennsylvania Rock Oil Company sent Edwin L. Drake to Titusville, PA, to drill for oil.
• The idea to drill for oil was new and many were skeptical 

• Oil had previously been obtained by melting fat from the whale or digging large pits and waiting for oil to
seep above ground—Both were time consuming and expensive.

• When Drake finally set up an oil well and began drilling with a steam powered engine, he struck oil.

• Titusville soon became one of the several boom towns in PA

• A byproduct of this process was gasoline, which would eventually make oil more valuable.

• Thomas Edison helped make another new source of energy called electric power.

• When Edison was awarded a $40,000 bonus, He left his job and set himself up as an inventor.

• Edison then began experimenting with electric light. 

• Starting in 1879, Edison and his fellow inventors tried different ways to produce light within a sealed
glass bulb.

• 1880 they finally found a workable filament made of bamboo fiber. This filament glowed, Edison said,
“the most beautiful light ever seen.

• Until the early 1880’s, people who wanted electricity had to produce it with their own generator. Edison then
developed the idea of a central power station.

• He built a power plant that lit dozens of buildings in NYC, by 1890, powers stations across the
country provided electricity lamps, fans, printing presses, and many other newly invented appliances.

• Lewis Latimer, the son of an escaped slave, patented an improved method for producing the filament in light
bulbs.
• Lewis Latimer, the son of an escaped slave, patented an improved method for producing the filament in light
bulbs.

• Latimer later wrote a landmark book about electric lighting.

• In 1885, George Westinghouse began to experiment with a form of electricity called alternating current,
which can be generated more cheaply and travel longer distances.
•Several inventors set up working telegraph systems way before Samuel Morse took out a patent
and perfected the telegraph.​
​
•His success signaled the start of a communication revolution.​
​
•In 1871, after Alexander Graham Bell immigrated to MA, he patented the “talking telegraph”.​
​
•The first commercial telephone began serving 21 customers in January of 1878 in New Haven,
Connecticut, and by 1900, 1.5 million telephones were in use.​
​
•The rail business expanded greatly after the Civil War, which resulted in the Transcontinental Railroad
—a railway extending from coast to coast.​
​
•Members of congress believed that the completion of a coast-to-coast railway would strengthen
the country’s economic infrastructure.​
​
•Most of the workers on the transcontinental railroad were immigrants and after 7 years, the two crews
met each other in what is now Utah.​
​
• Scheduling proved to be another problem for railroads, so in 1833, the railroads adopted a national system of
time zones to improve scheduling and as a result, clocks in broad regions of the country showed the same
time and is a system we still use today.

• In 1850, Henry Bessemer in England and William Kelly in Kentucky developed a new process for making steel.

• Bessemer received the first patent for the Bessemer process— made it much easier and cheaper to remover
impurities from steel.

• The Bessemer Process made possible the mass production— or production in great amounts of steel.

• As a result, a new age of building began, Bridges.

• The only way to travel between Brooklyn and Manhattan was by ferry which would often get shut down in
the winter, which resulted in the idea of the Brooklyn Bridge.

• It was a symbol of American success.

Section 2 
• Andrew Carnegie was one of the most successful business leaders and
industrialists in the late 1800s. 
• Andrew embraced the concept “Money could make Money”
• The period of invention after the Civil War set the stage for great
industrial growth. 
• To succeed, business leaders often combined funds and resources to
create large companies. The age of business was born. 
• The terms robber barons and captains of industry were used to
describe the powerful industrialists. 
• Robber Barons- business leaders built their fortunes by stealing from
the public. 
• Captains of Industry- the business leaders served their nation in a
positive way. 
• John D. Rockefeller formed the Standard Oil Company. 
• His philanthropy helped found the University of Chicago and the
Rockefeller foundation, which gave aid to institutions working in the
fields of public health, art, and social research. 
• Carnegie’s Gospel of Wealth- people should be free to make as much
money as they can. After they make it, however, they should give it
away. 
• Carnegie donated to free public libraires, supported artistic and
research institutes and set up fund to study how to abolish the war. 
• Carnegie suggested the wealthy were the most valuable group in
society. 
• Social Darwinism- society should do as little as possible to interfere
with people’s pursuit of happiness. 
• Social Darwinists believed that if the government would stay out of
the affairs of business, those who were most “fit” would succeed and
become rich. 
• As a result, the government neither taxed businesses’ profits or
regulated their relations with their employees.
•  Businesses grew to include much greater sums of money, more
workers, and more products than had previously existed in American
business. 
• Several Characteristics help to explain how big businesses differed from
earlier forms of business in the US
• Larger pools of capital- Entrepreneurs had to invest massive amounts of
capital themselves or barrow huge sums from investors for new
technology and be able to run large plants. 
• Wider Geographic Span- railroads and the telegraph aided the expansion
of business. This helped businesses especially with factories and offices in
different regions. 
• Broader range of operations- Big businesses combined multiple
operations, they were responsible for all or most of all stages of
production. 
• Revised role of ownership- business were often too large so the owners
had no relationship with their employees. Professional managers were
often hired to run the business, however, they had zero ownership, but
was responsible for overseeing operations. 
• New methods of management- complex systems of accounting were
necessary to control large amounts of resources. Big businesses
developed new systems of formal, written rules and created special
departments. 
• A market that is dominated by only a few large, profitable firms is
called an oligopoly. Many industries today are Oligopolies such as:
breakfast cereals, cars, and household appliances. 
• Cartel- a loose association of businesses that make the same product.
Members of these cartels agreed to limit the supply of product and
keep prices high. 
• Vertical Consolidation- gaining control of many different businesses
that make up all phases of a product’s development. 
• This method allowed Carnegie Steele to maintain very low production
costs. 
• Carnegie would charge less because of what is known as economies of scale. 
• Economies of scale is a production increase, but the cost of each item
produced is lowered. 
• In 1859, Edwin L. Drake discovered oil. John Rockefeller was very excited about
this new find. 
• Rockefeller sought oil as another way to continue gaining income and become
extremely wealthy. 
• Rockefeller’s company sold more oil, he was able to charge less, meaning he
was underselling his competition. 
• Horizontal consolidation, involves the bringing together of many firms in the
same business. 
• Rockefeller tried to buy out his competition, but state laws prohibited one
company from owning the stock of another. 
• The board of trustees, which Rockefeller was in control of, managed the
companies as a single unit called trusts. 
• Over time 40 companies joined the trust, this allowed Rockefeller’s
trust, basically monopoly, controlled a high percentage of the nation's
oil-refining capacity. 
• Many Americans feared that trusts were limiting industrial
competition began to demand government action to break up
industrial gains.
• Congress did pass a law, in 1890 to attempt to limit the amount of
control a business could have over one industry.
• The Sherman Antitrust Act outlawed any combination of companies
that restrained interstate trade or commerce.
• The law was extremely unclear which aided the giant corporations
when it was applied successfully against labor unions. 
Section 3
Industrialization and
workers
• Around 14 million people
immigrated to the US between 1860
and 1900
• Labor was scarce for immigrants, so
they passed the labor act in 1864.
This allowed employer to enter
contracts with immigrants
• In the 1800s around 8 to 9 million
Americans moved to cities due to
bad economic conditions on farms
• There was a drought in 1887, and
competition from foreign wheat
producers. Left many families broke
• In the 1860s employers paid workers not by the time worked but by
what they produced 
• Piecework- meant that those who worked the fastest and produced
the most pieces warned the most money
• Sweatshop- a shop where employees worked long hours at low wages
and under poor working conditions 
• In 1881 Frederick Winslow Taylor studied workers to improve
efficiency 
• In a factories worker were ruled by the clock, which told them when
to start, take breaks, and when to stop work. 
• Discipline in the factory was strict if you were late, talking, or refusing
to do a task he would fine you or fire you
• Workplaces were not safe the noise of the machines could be
deafening, lighting was often poor, and faulty equipment could injure
you. 
• Because of work conditions children became stunted in both body
and mind 
• In the 1800s children made up more than 5 percent of the industrial
labor force, one in five children between the ages of 10 and 17 were
employed
• Children often left school and the age 12 or 13 to go to work 
 Section 4: The Great Strikes 
• Industrialization had lowered the prices of consumer goods, but in the late
1800’s most factory workers did not earn enough to buy them.
• Socialism—an economic and political philosophy that favors public instead of
private control of property and income; Socialists believed that wealth should be
distributed equally to everyone.
• Most Americans opposed socialism and saw it as a threat.
• Early labor unions, organized among workers in certain trades, such
as construction and textile manufacturing.
• Many unions in general suffered because of poor economy.
• The Knights of Labor formed in Philadelphia in 1869, had hoped to organize
all working men and women, skilled and unskilled, into a single union.
• African Americans and women were recruited to join, and they
believed equal pay for equal work, the eight-hour workday, and an
end to child labor.
• By the 1890’s the Knights had largely disappeared as a national force.
• The American Federation of Labor (AFL) sought to only organize
skilled workers in a network of smaller unions, each devoted to a
specific craft, in other words the AFL was a craft union.
• They did not include women because they believed it would drive
wages down.
• Collective bargaining—a process in which workers negotiate as a
group with employers
• By large, employers disliked and feared unions and as a result the took
measures to stop unions:
• Forbidding union meetings
• Firing union organizers
• Forcing new employees to sign the “yellow dog” contracts, in which workers
promised to never join a union or participate in a strike.
• Refusing to bargain collectively when strikes did occur.
• Refusing to recognize unions as their workers’ legitimate representatives.
• The great railroad strike began in July of 1877 when the Baltimore and
Ohio Railroad announced a wage cut of 10% during a depression.
• Railway workers reacted angerly and workers in West Virginia were the
first to declare a strike.
• Soldiers fired on rioters, killing a wounding many, and a crowd of 20,000
men and women reacted to the shooting and set fire to railroad
company property causing more than $5 million in damage.
• Industrial Union was proposed by Eugene V. Debs which was
organized workers from all crafts in each union.
• From 1881 to 1900 the United States faced over 24,000 strikes that
erupted factories, mines, mills, and rail yards. 
• Three events were extremely violent: Haymaker Riot, Homestead and
Pullman Strikes. 
• On May 3, at Chicago’s McCormick factory, police broke up a fight
between strikers and scabs. 
• Scab- a negative term for a worker called in by an employer to place
striking laborers. 
• The use of scabs allows for a company to continue working and to
avoid having to bargain with the union. 
• At the May 4 event. Someone threw a bomb into a police formation,
killing one officer. A riot fallowed killing dozens on both sides of police
and rioters. 
• The rioters who took part in the Haymaker Riot would be known as
heroes forever, however to employees, they would be known as
criminals. 
• The Homestead Strike was a strike that involved Andrew Carnegie’s
partner Henry Frick cutting wages of Carnegie’s employees while he
was in Europe.
• At first many sympathized for the strikers, the union admitted defeat
and called off the strike. Carnegie believed in unions and accepted
their right to strike.
• The last of the strikes involved the railroad industry. 
• On May 11, 1894, employees of Pullman Palace Car Company went on
strike because of cut wages and firing of the union representatives. 
• On June 26, the American Railway Union called a boycott for all
Pullman railway cars. 
• The Pullman Strike would set an important pattern for years to fallow.
Factory owners often appealed court orders against unions. 
• This government opposition helped limit union gains for more than 30
years.