Industrialization

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Cornelius Vanderbilt

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Used his millions earned from a steamboat business to merge local railroads into the New York Central Railroad in 1867.

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New York Central Railroad

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Ran from New York City to Chicago and operated more than 4,500 miles of track.

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Federal land Grants 1865-1900

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Federal government provided railroad companies with huge subsidies in the form of loans and grants.

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Transcontinental Railroad

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Connected California to the rest of the Union.

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Jay Gould

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Speculator, who went into railroad business for quick profits and made millions by selling of assets and watering stock.

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Panic of 1893

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Forced a quarter of all railroads into bankruptcy.

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J.P. Morgan

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Banker, who took control of the bankrupt railroads and consolidate them.

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Bessemer Process

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Process for making large quanities of steel by blasting air through molten iron produced high quality steel. Discovered by Henry Bessemer in England and William Kelley in the U.S. in 1850s.

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Andrew Carnegie

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Shrewd business genius, who was leader of fast-growing steel industry. Employed a business strategy known as vertical integration.

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Vertical Integration

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A company would control every stage of the industrial process, from mining raw materials to transporting the finished product.

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U.S. Steel

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Corporation headed by J.P. Morgan. First billion dollar company and largest enterprise in the world.

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John D. Rockefeller

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Took charge of the chaotic oil refinery business. His company was known as the Standard Oil Trust

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Standard Oil Trust

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Consisted of various companies that he had aquired. In 1881 company controlled 90% of the oil refinery business. Fromer competitors were brought under one single corporate umbrella.

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Horizontal Integration

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In microeconomics and strategic management, the term horizontal integration describes a type of ownership and control. It is a strategy used by a business or corporation that seeks to sell a type of product in numerous markets. Horizontal integration in marketing is much more common than vertical integration is in production. Horizontal integration occurs when a firm is being taken over by, or merged with, another firm which is in the same industry and in the same stage of production as the merged firm, e.g. a car manufacturer merging with another car manufacturer. In this case both the companies are in the same stage of production and also in the same industry. This process is also known as a "buy out" or "take-over".

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Anti Trust Movement

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Middle citizens feared the trusts' unchecked power and urban elites (old wealth) resented the increasing influence of the new rich.

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Sherman Antitrust Act 1890

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Prohibited any "contract, combination, in form of trust or otherwise, or conspiracy in restraint of trade or commerce."

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United States v. E.C. Knight

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Supreme Court ruled that the Sherman Antitrust Act could be applied only to commerce, not to manufacturing.

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Laissez – Faire Capitalism

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Business should be regulated, not by government, but by the "invisible hand" (impersonal economic forces) of the law of supply and demand.

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Adam Smith

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Economist, who argued in "The Wealth of the Nation" for laissez-faire. Believed that if the government kept their hands off, then business would be movitated by their own self-interest to offer improved goods and services at low prices.

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Gospel of Wealth

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Some Americans found religion to be the most convincing way to justifymthe wealth of successful industrialists and bankers.

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Transatlantic Cable

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Made it possible to send messages across the sea in an instant.

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Alexander Graham Bell

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Invented the telephone in 1876.

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Sear Roebuck

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Large mail-order companies used improved rail system to ship everything from hats to houses ordered from their thick catalogs known as the "wish book."

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Horatio Alger

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Wrote popular novels that sold over a million copies. Every novel portrayed a young man who became rich and successful through honesty, hard work, and a little luck.

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Railroad Strike of 1877

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One of the worst outbreaks of labor violence erupted in 1877, during economic depression, when railroad companies cut wages in order to reduce costs. It shut down 2/3 of country's rail trackage. Strike quickly becoming national in scale. For the first time since 1830s federal troops used to end labor violence. More then 100 people killed.

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National Labor union

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First attempt to organize all workers in all states. Founded in 1866. Goals of higher wages and 8 hour work day. Also equal rights for women and blacks, monetary reform and worker cooperatives. Chief victory was winning 8 hour work day for workers employed by federal government. Lost support after depression and unsuccessful strikes.

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Knights of Labor

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First attempt to organize all workers in all states. Founded in 1866. Goals of higher wages and 8 hour work day. Also equal rights for women and blacks, monetary reform and worker cooperatives. Chief victory was winning 8 hour work day for workers employed by federal government. Lost support after depression and unsuccessful strikes.

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Terence V. Powderly

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Leader of Knights of Labor. Advocated variety of reforms: (1) worker coorperatives "to make each man his own employer," (2) Abolition of child labor, and (3) Abolition of trusts and monopolies. Favored settling labor disputes by arbitration rather than strikes.

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Haymarket Bombing

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On May 4, workers held a public meeting in Haymarket Square. Police attempted to break up meeting. Someone threw a bomb and killed 7 police. Bomb thrower never found, but 8 anarchist leaders tried for crime and 7 sentenced for death.

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American Federation of Labor

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Concentrated on attaining practical economic goals. Founded in 1886 association of 27 craft unions. Did not advocate reform programs to remake American society. By 1901 by far the nation's largest union.

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Samuel Gompers

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Led the American Federation of Labor from 1886 to 1924. Went after basics of higher wages and improved working conditions.

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Homestead Strike 1894

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Henry Clay Frick precipitated a strike in 1892 by cutting waged by nearly 20%. Frick used lockout, private guards, and strikebreakers to defeat steelworkers' walkout. Failure of strike set back union movement in steel industry.

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Eugene V. Debs

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Leader of American Railroad Union. He directed railroad workers not to handle any trains with Pullman cars. He was arrested and jailed for failing to respond to injunction.