The Gilded Age 18651900 Last lesson we covered;
The features of the gilded age The key inventions of the gilded age Reasons why some much growth took place
DISCUSS
What can you recall from your notes last lesson?
The features of the gilded age The key inventions of the gilded age Reasons why some much growth took place
TODAY YOU WILL BECOME AWARE OF;
The men who made America How they made so much profit How political corruption became a consequence of Capitalist growth,
THE GILDED AGE – THE MEN WHO MADE AMERICA THE RISE OF THE INDUSTRIALISTS – VANDERBILT, ROCKEFELLER, CARNEGIE AND MORGAN
Pre 1965 – Vanderbilt switches from shipping to railroads – builds 40,000 miles across the USA 1867 - Vanderbilt blockaded the bridge over the Hudson river, the only bridge into New York, to stop other trains accessing the city. Seizes control of all railroads Vanderbilt sees future in transporting oil (kerosene) Offers deal to a poor man called Rockefeller who owns an oil well in Colorado. Rockefeller eventually undercuts Vanderbilt with a better rate made with a competing railroad baron Tom Scott. His protégé is Andrew Carnegie. Scott asks Carnegie to build a bridge over the Mississippi to improve the profit on his railroads. Construction begins in 1870. Rockefeller’s might and wealth increases. He buys out other refineries and begins to create a monopoly. Vanderbilt and Scott make a railroad alliance which demands Rockefeller pays full rate for using their railroads. Rockafella builds oil pipelines in retaliation against these rates.
1872 – Scott and other investors finances Carnegie’s first steel mill. Investors see a 40% add on to their investment. The first steel mill produces 250 tones of steel a day. The 1873 depression offers Rockefeller the opportunity to buy up all other refineries at a cheap rate. Now owns 98% of oil refineries across USA. 1874 – Carnegie completes the building of the St Louis steel Eads Bridge, linking East to West America over the Mississippi. Scott begins to build his own oil pipelines. Rockefeller sees this as a challenge Rockefeller still relies on Scott’s railroad for the Pittsburgh to New York link – impossible for pipelines. Rockefeller demands Scott ceases pipeline production. Scott ignores threat. Rockefeller closes down all his Pittsburgh refineries to destroy Scott’s P-NY railroad. Thousands thrown out of work and Rockefeller loses a lot of money. However, it is about winning. Scott is destroyed. 1877 – Vanderbilt dies 1878 – Thomas Edison shows off the electric light to some New York reporters. JP Morgan, a banker, sees the potential and inserts massive funding to the project. 1881 – Scott dies a broken man. Carnegie, his protégé, wants revenge on Rockefeller
CARNEGIES – STEEL -1874 EADS BRIDGE AND HIS FIRST STEEL MILL, 1872.
1880 – Electric lights cast their glow over Menlo Park, New York. JP Morgan’s house is lit by electric, the first house in history. Generators are being built to spread electric over New York through cables built underground. This is a major challenge to Rockefeller kerosene industry. 1881 – Carnegie meets and appoints Henry Frick as his chairman. He considers him the tough kind of character that would boost his profits 1882 – First power plant to spread electricity built in New York, financed by Morgan. 1884 – Carnegies steel mills change the face of America. First skyscraper built in Chicago – The Home Insurance Building. He builds up his wealth. 1886 – A company at Niagara Falls begins to build the world’s largest power plant. It will be capable to light the entire north east of the US. 1887 – Edison Electric Company set up. JP Morgan buys heavily into it. 1889 – Johnstown Flood kills. 2,209 killed. Carnegie and Frick blamed.
JP Morgan
Henry Frick Carnegie Hall
The First Skyscraper, Chicago
Johnstown Flood
Edison with the first generator
1890 – Battle of the currents – Edison (DC) vs Tesla (AC). In an attempt to discredit Tesla, Edison assists in the first electrocution, using AC. It becomes a grisly spectacle. Despite AC being used, Edison takes the blame. His name is removed and the company becomes General Electric. He refuses to set foot in the building and goes on to invent the first motion picture and improve the phonograph. Morgan remains committed to electric. 1891 – Carnegie builds Carnegie Hall, New York. 1891 – The Niagara Falls power plant is nearing completion. What current will they choose? AC or DC? Who will they give the contract to? Tesla’s financial backer (Westinghouse) is struggling. Tesla gives up the worth of his patent (AC) to help out. Investments flood in. The race is on to win the Niagara contract.. 1892 – Homestead Strike, Pittsburgh. 12 hour days 6 days a week drives the workers to demand an improvement to working conditions. Frick sends in agents to break up the strike. 9 killed. Carnegie, who is in Scotland, takes the blame. His reputation is in shatters. Frick survives an attempted assassination. Carnegie has him removed from the company. 1893 – Chicago World Fair – Westinghouse and Tesla win contract to light up the fair with AC – They outbid Morgan. Westinghouse wins the Niagara contract.
RIGHT – THE WORLD FAIR 1893. LIT BY ELECTRICITY BELOW – TESLA’S POWER PLANT, NIAGARA FALLS.
Westinghouse is forced to sign over the contract and the AC patent to Morgan when Morgan threatens a law suit over ownership of AC. Westinghouse cannot afford the fight. General Electric becomes the owner of AC and becomes America’s biggest corporation. JP Morgan joins Rockefeller and Carnegie as the most powerful industrialists of the Age. 1895 – Morgan helps bails out the US government. 1895 - Rockefeller needs to find a response to electric. One of the side products of oil, is gasoline. Can it be used for something? -----------------------------------------------------------------------------------------------------------------------------• By 1896, there is growing concern over power, and the gap in wealth between the poor and the rich. The three men are worth over 1 trillion dollars, more than the top forty wealthy people combined in the world today. • The average American earns only a dollar a day., well below the poverty line. Working conditions are unbearable. 1/11 steel workers die a year on the job. • William Jenning Bryan, a Democrat politician, vows to destroy the growing titans of wealth. He claims that the three industrialists are taking over the country. He promises to break down their companies and put them behind bars.
EPISODE 4 – MEN WHO MADE AMERICA HTTPS://WWW.YOUTUBE.COM/WATCH?V=8SH6XYR WUWW
1896 Election – The three men come together to support Republican William McKinley. They each give over 200,000 dollars to McKinley.($20million today) Bryan begins a tour of the country, doing public speeches. The trio suggest if Bryan wins, businesses will collapse. McKinley wins.
Rockefeller buys up mass amounts of iron ore and offers it to Carnegie's steel competitors at cheaper prices. Carnegie's profits begin to fall. Rockefeller then decides to build a steel plant to challenge Rockefeller’s dominance over the steel industry. Negotiations between the two fail. Carnegie offers to buy the entire output of Rockefeller’s mines in return for Rockefeller’s agreement to stay out of steel. It is a victory for Rockefeller. 1901 – Morgan buys Carnegie Steel for 480 million dollars. It makes Carnegie the richest man ever. He is worth $380 billion dollars in today’s money. It becomes US Steel. McKinley wins second term. His vice president, Theodore Roosevelt has been put there with money by Morgan and Rockefeller. Roosevelt is anti-trust and the vice presidency is considered a weak position, somewhere he can do no harm to them. McKinley is assassinated by an ex factory worker, angry at the wealth divide. Roosevelt becomes President, to the horror of Morgan and Rockefeller.
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1901 - Roosevelt begins to pass anti-trust laws. Breaking up the monopoly of the railroads. Monopolies begin to fall. Roosevelt goes after Standard Oil next.
1902 – ALUM (car monopoly) stops Henry Ford’s patent for a new affordable vehicle; the Model A. He races the fastest member of ALUM to a race, in his car, winning.
1903 - The publicity gets investment. HE builds his first factory, building 15 cars a day. ALUM takes him to court. HE gets sympathy as the “little guy”. 1904 – JP Morgan arranges the Panama Canal deal for the US government, linking the Atlantic to the Pacific. It will cost $40 million.
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Ford defies the monopoly and continues to sell cars. He pays his workers double the rate of most US factories and getting more out of them through the Assembly line. He standardises the 8 hour, 5 day a week working schedule.
1909 – Ford wins his case. He begins to mass produce the Model T. The car changes everything. This encourages two men called Harley and Davidson to manufacture their engine on a bike. Rigley takes his chewing gum national and Polish man Max Factor brings his cosmetics to America. 1911 – Rockefeller’s Standard Oil company is found guilty of acting illegally. It is broken up into 34 different companies. 1913 – JP Morgan dies The Monopoly system is over.
HARLEY AND DAVIDSON. MAX FACTOR
SUMMARY The new breed of Businessmen may be doing things differently, but they use Rockefeller’s gasoline for petrol, Morgan’s steel for the car, and Morgan’s electricity on the factory floor. However, because of better working conditions, the 40 hour week, a new middle class begins to grow. The 34 companies that were broken up from Standard Oil become huge corporations in their own right; Exon, Chevron, Mobil with Rockerfeller an investor in each one! He becomes the richest man in history.
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SPIDER DIAGRAM 4
4. The Rise of Big Business.
THE RISE OF BIG BUSINESS ► Andrew
Carnegie -
STEEL ► John D. Rockefeller – OIL ► J.P. Morgan – BANKING/GE
THE RISE OF BIG BUSINESS â–ş
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Vertical Integration A process in which a company buys out all of the suppliers. (Ex. coal and iron mines, ore freighters, Horizontal Consolidation A process in which a company buys out or merges with all competing companies (JP Morgan bought out Carnegie steel and other companies)
THE RISE OF BIG BUSINESS ►
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Trusts -A group of separate companies placed under the control of a single managing board Critics called these practices unfair and the business leaders “Robber Barons”
THE RISE OF BIG BUSINESS ► Social
Darwinism Used Darwin’s theory to explain business Natural Selection, Survival of the Fittest Govt. should not interfere ► Laissez-faire Policy that US had followed since inception to not allow govt. to interfere with business ► Captains of Industry A positive idea that industrial leaders worked hard and deserved their wealth
THE RISE OF BIG BUSINESS ►
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Gospel of Wealth -belief that the wealthy are “chosen by God” to be successful and were therefore responsible to look out for the well being of those less fortunate. Many Industrialist shared wealth although rarely through direct welfare. Started museums, etc. Monopoly-complete control of a product or service
THE RISE OF BIG BUSINESS â–ş
Sherman Anti-Trust Act of 1890 ďƒ‰
Law outlawing a combination of companies that restrained interstate trade or commerce; important to prevent monopolies. Not initially enforced properly.
SPIDER DIAGRAM 5 
5. Political Corruption
THE RISE OF POLITICAL MACHINES ►
Political Machines –an organized group of people that controlled the activities of a political party
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By giving voters services they needed, the machine won their vote and controlled city government
City Boss was head of Political Machines
Controlled ► Jobs
in police, fire, and sanitation departments ► Agencies that granted licenses to businesses ► Money to fund large construction projects
“All Politics center around the Boss”
POLITICAL MACHINES ►
Political machines loved immigrants, WHY?
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Never voted, tried to sway votes by bribery, intimidation, and other eans
Political machines used power to
Rig elections Become wealthy from kickbacks-illegal payments Control police force to stay out of trouble
“BOSS TWEED” AND THOMAS NAST William “Boss” Tweed City Boss of Tammany Hall- Democratic Political Machine in New York City ► Thomas Nast –political cartoonist who was critical of machines and Tweed ►
PENDLETON CIVIL SERVICE ACT 1883 ► ►
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Attempted to end Patronage/Spoils System 1. Creating the Civil Service Commission which required appointed govt. officials to pass the Civil Service Exam to base jobs on merit instead of friendship 2. Federal employees did not have to contribute to campaign funds 3. Federal employees could not be fired for political reasons
Chester A. Arthur signed Pendleton Act into effect
James Garfield
CORRUPTION IN GOVERNMENT Patronage or Spoils System- giving government jobs to loyal party workers or friends Were not qualified Used position to get money from government (graft) President James Garfield is assassinated by disappointed office seeker favoring Spoils System President Chester Arthur signs Pendleton Civil Service Act of 1883 1896 – Carengie, Rockefeller and Morgan finance Mckinley’s presidential victory. They even manage to sideline Theodore Roosevelt who wanted to bring them down. Charles Guiteau