Was the interstate commerce act an important piece of legislation?

Chapter #24: Industry Comes of Age – Big Picture Themes 1. Before the Civil War, railroads had become important. After the war, railroads boomed and were critical to the nation. Railroads, along with steel, were to be the skeleton on which the nation’s economy would be built.

2. A class of millionaires emerged for the first time ever. Tycoons like Carnegie and Rockefeller made fortunes. This type of wealth was championed by “Social Darwinism” where the strong win in business.

3. Unfortunately, many of the mega-industries, like railroads, grew at the expense of the “little man’s” interest. As businesses, they were out to make money, and they did. But the working man cried foul.

4. To right these wrongs, the beginnings of anti-trusts began (to bust the monopolies) and organized labor got a jumpstart (although they were still rather ineffective).

Chapter #24: Identifications

Government Subsidies Government Subsidies are forms of aid/support in paying the Bank of United States. Normally it is for the economy of the United States.

Transcontinental Railroad
A Railroad that connected the east to the west. It allowed for better and faster transportation. Goods could be delivered more easily and military troops could be moved instantly.


Cornelius Vanderbilt Cornelius Vanderbilt was a business man that was able to monopolize the railroad industry. He was also known as a robber baron and became one of the richest men in America.

Jay Gould Jay Gould was a speculator who put down rail road track and forced competitive rail road lines to buy it at extremely high prices. He took advantage of this buy draining all of the customer’s money.
 
Interstate Commerce Commission This was created in order to regular railroads so that no one could monopolize this industry. However it later implemented carriers and bus lines. It was abolished in 1996.

Vertical Integration It describes a style of growth and that each company is owned by a bigger owner. Each business makes different goods but profits still go to the same owner.

Horizontal Integration
Horizontal Integration is the process where companies make production units and set it to prices equal to the competition. This is used to reduce competition with rival companies.


Trusts A Trust is when someone relies on another person to take care of the business with mutual agreement in funds.

J.P. Morgan Morgan was a major business man that monopolized the banking industry. He played a major rule in corporate finance and industrial consolidation. Morgan successfully combined Edison and Thomas Electrical companies.

Sherman Anti-Trust Act The Sherman Antitrust Act is a federal statute on United States competition law passed by Congress in 1890. It forbids certain business actions to be anticompetitive and therefore makes the government explore their whereabouts.

Yellow Dog Contracts These contracts were agreements met between the employee and the boss. This is necessary to start your job at a business. It was put in place to prevent unions.

Blacklists This was a list of people who were banned. These people also could not get jobs.

Haymarket Square incident
A terrorist threw a bomb at a police officer. This refers to the aftermath of the bombing and took place in 1886. As a result gunfire broke out and many people died.

Chapter #24 Guided Reading Questions

The Iron Colt Becomes an Iron Horse

Know: Land grants

1.       What were the advantages and disadvantages of government subsidies for the railroads?

During the 19th century, the railroad companies in the U.S began to move towards the west. Railroad companies began building transcontinental railroads to connect the east and the west. The government gave financial aid to the railroads companies, and also gave those land grants. Land grants allowed companies to reserve land from other people. In return, the government received part of the shares of the land and gained money from it.

Spanning the Continent with Rails

Know: Union Pacific, Central Pacific, Paddies, Leland Stanford

2.       Describe how the first transcontinental railroad was built.

During the Civil War, Congress began to prepare for the construction of a railroad that would connect the Pacific coast to the East coast. Congress then commissioned the Union Pacific Railroad company to start from the East coast. For every mile of track built, the company was given 20 square miles of land. Veterans of the Civil War, including the Irish paddies, then began to build the railroad westward. In California, the responsibility to construct the railroad was the Central Pacific Railroad’s. The project in the west was financed by the Big Four, which included Leland Stanford and Collis P. Huntington. From the west, Chinese workers worked the railroad, and many died due to explosions and accidents. In 1869, the two sides of the transcontinental railroad finally united near Ogden, Utah.

Binding the Country with Railroad Ties

Know: The Great Northern, James J. Hill

3.       Explain how the railroads could help or hurt Americans.

The Great Northern was the only one that did not receive huge land grants unlike the others. The rest were the Northern Pacific Railroad, the Atchison, and the Southern Pacific.

James J. Hill was accountable for the building of the Great Northern, and he understood that the success of his railroad be determined the location.

 

 

 

Railroad Consolidation and Mechanization

Know: Cornelius Vanderbilt, Pullman Cars

4.       What technological improvements helped railroads?

Western railroads were successful due to the welding together of the old eastern railroads. Cornelius Vanderbilt invested in this business, and he offered better railroad service at lower prices. Pullman cars were introduced, and provided housing for people that traveled using railroads. Pullman cars were dangerous because of the wooden cars being furnished with kerosene lamps that could burn the car.

Revolution by Railways

Know: Time Zones

5.       What effects did the railroads have on America as a whole?     

The railroads of America bonded the nation, and united it into one. Farmers started building farms next to the railroad, and brought them farming tools and allowed them to transport their fresh goods to the marketplaces across the country. Every town in the country had their own time, and the railroad had to spereate the United States into four time zones.

 

 

 

Wrongdoing in Railroading

Know: Jay Gould, Stock Watering, Pools

6.       What wrongdoing were railroads guilty of?

The Credit Mobilier was one of the first scandals to take over government. One of the most famous scammers was Jay Gould. Stock watering was one of his methods to gain profit and many others like him preferred scheme.  For example, they would make cows really thirsty by giving them salt, and so the cows would drink more water and weigh more when they were weighed for sale. For a long time, railroad kings governed the economy, but they began to get smarter and they divided their business and share the profits in pools.

 

 

Government Bridles the Iron Horse

Know: Wabash, Interstate Commerce Commission

7.       Was the Interstate Commerce Act an important piece of legislation?

The railroad companies faced pressure from groups like the Grange, and the many Midwestern legislatures decided to control the railroads. In 1886, the Wabash case went before the Supreme Court and declared that individual states had no power to control interstate commerce. Therefore, Congress passed the Interstate Commerce Act. The Interstate Commerce Act prohibited rebates and pools and it forced railroad companies to publish their rates openly.  

Miracles of Mechanization

Know: Mesabi Range, Alexander Graham Bell, Thomas Edison

8.       What factors made industrial expansion possible?

Industrial expansion was made possible through the acquisition of large amounts of raw materials, such as iron, coal, and oil. In the Mesabi Range held vast amounts of rich iron deposits that fed the steel factories. With a big workforce, and plenty of raw materials available, the need for inventors sprung up. Alexander Graham Bell, invented the telephone. Thomas Edison was the creator of the phonograph and also perfected the electric light bulb.

The Trust Titan Emerges

Know: Andrew Carnegie, John D. Rockefeller, J.P. Morgan, Vertical Integration, Horizontal Integration, Trust, Interlocking Directorate

9.            How did businesses organize to try to maximize profits?

Many rich people like Andrew Carnegie, John d. Rockefeller, and J.P. Morgan, the banking genius, worked together to increase profit. Andrew Carnegie monopolized the industry of steelmaking. This system of controlling everything before the actual steelmaking was called vertical integration. Horizontal integration on the other hand is the act of working together with competitors to create a monopoly among a single industry. Rockefeller came up with a plan called the trust, which made bothersome rival competitors work together. Interlocking directorates was something Morgan came up with to insure maximum profit by moving them into banking syndicates.

 

The Supremacy of Steel

Know: Heavy Industry, Capital Goods, Consumer Goods, Bessemer Process

10.     Why was steel so important for industrialization?

Steel was very important because it was used to build skyscrapers, railroads, and all the other tools necessary for a good country. Steel was vital to heavy industry which made capital goods, not consumer goods such as shoes and clothes. The Bessemer process allowed for the production inexpensive steel to be made. William Kelly and Bessemer discovered that cold touching molten iron turns it into steel.

 

 

 

Rockefeller Grows an American Beauty Rose

Know: Kerosene

12.     How was John D. Rockefeller able to become so wealthy?

Oil was discovered in 1859, but was found in Pennsylvania when a well spewed out this black gold. Kerosene came from petroleum and acted as America’s main energy source. Rockefeller was able to control this industry by making the Standard Oil Company of Ohio. By 1877 he was in control of 95% of all oil factories in the United States.

The Gospel of Wealth

Know: Social Darwinism

13.     How did the wealthy justify their wealth?

The wealthy justified their wealth with the theory of Survival of the Fittest. It was created by Charles Darwin and named Social Darwinism. They said that rich people were able to become successful because they were hard workers. Poor people remain poor because they are lazy.

Government Tackles the Trust Evil

Know: Sherman Anti-Trust Act

14.     What two methods were tried by those who opposed the trusts?

People that opposed trusts tried to control the trusts though the state legislation. After several attempts, the government decides to pass the Sherman Anti-Trust Act. It restricted trade without any difference between good and bad trusts. However the law proved to be useless.

The South in the Age of Industry

15.     How successful were Southerners at industrializing?

Southern industrialization was boosted due to an automatic cigarette roller. Duke was able to take advantage of this boom and make a fortune out of it. He took on smaller companies and united them under one name, the American Tobacco Company. The railroad was also able to transport more of the farmer’s products throughout the U.S.

The Impact of the New Industrial Revolution on America

16.     Describe the positive and negative effects of the industrial revolution on working Americans.

 

Positives aspects of the Industrial Revolution in America were that it significantly increased production rates and good living. Goods were able to be transported quickly and could benefit factories looking for raw materials. The Negatives effects were that it quickly made citizens slaves of factories. Many people worked for very low wages and were treated unfairly.

 

 

 

 

 

 

In Unions There is Strength

Know: Scabs, Lock-out, Yellow-dog Contract, Black List, Company Town

17.     What conditions existed in America that led Jay Gould to say, "I can hire one half of the working class to kill the other half"?

American industry invented many machines that replaced workers. But more jobs were created and manual labor was less dominant. To insure that workers follow the rules, the company managers set up Yellow-dog Contracts to make workers agree to the terms and services. People that couldn’t work in town where Black Listed, if any were found to be at work in a business, the business would be shut down. Politicians could hire scabs to enforce order and take down labor organizers.

Labor Limps Along

Know: National Labor Union, Knights of Labor

18.     Explain the similarities and differences between the National Labor Union and the Knights of Labor.

 

The National Labor Union and Knights of Labor are different and similar in many ways.  The National Labor Union allowed all types of citizens except Asian Americans. The gathered around 600,000 members and called for fair working conditions. Wages were cut down in 1877 because of railroad strikes. The Knights of Labor allowed all races to join their cause. At first they were a secret organization but now they turned public. They fought there problems by using politics.

 

Unhorsing the Knights of Labor

Know: Haymarket Square

19.     What factors led to the decline of the Knights of Labor?

The Knights of Labor were accused of terrorist attacks many times. One incident was at the Haymarket Square. Supposedly a bystander planted a bomb in the crowd and caused havoc across the streets. As a result, police officers shot into the crowd and killed many innocent people.

 

The AF of L to the Fore

Know: American Federation of Labor, Samuel Gompers, Closed Shop

20.     How was the AFL different from previous unions?

The AFL was created to govern a massive amount of unions but at the same time keep there independence. It was created by a Jewish cigar maker named Samuel Gompers. He wanted to keep the strikes pure and simple where he demanded better wages, hours, and working conditions. Their major goal was to honor a trade agreement and authorizing the closed shop.

Makers of America: The Knights of Labor Know:           Mother Jones, Terence Powderly

21.     Were the Knights conservative or revolutionary in their ideas?

Their ideas were revolutionary because they were the first group to support Chinese people and women. Flery Mary Harris also known as Mother Jones was the first one to join. She started by rousing for the group in Illinois. Another group of people they attracted were the Irish. Terrence Powderly was the grand master and was a guard for the railroad.

Varying Viewpoints: Industrialization: Boon or Blight           22.       To what degree is it possible for common people to improve their status in industrial America?

Common people really couldn’t do much to improve their status. They would become slaves to the industry and work no matter what. If they didn’t work they would not be able to support their family. Another reason they needed to work for long periods of time was that the pay was too little. During the Gilded Age, America was hungry for money and would do anything to make a profit.