AP United States History II Chapter 16 Outline America’s Gilded Age, 1870-1890 I. Introduction II. The Second Industrial Revolution A. The Industrial Economy Rapid expansion of factory production, mining, and railroad construction By 1913, the United States produced one-third of the world’s industrial output 1880 Census found a majority of workforce engaged in non-farming jobs By 1890, two-thirds of Americans worked for wages Manufacturing took place in cities that were key for financing industrialization: 1. New York 2. Great Lakes Region 3. Pittsburgh 4. Chicago B. Railroads and the National Market The railroad made possible the ‘second industrial revolution’ By 1890s, five transcontinental lines carried products of western mines, farms, ranches, and forests to eastern markets, and manufactured goods to the West The growing population formed an expanding market for mass production, mass distribution, and mass marketing of goods C. The Spirit of Innovation Technological innovations spurred rapid communication and economic growth Creations of inventors Thomas A. Edison and Nikola Tesla D. Competition and Consolidation Dramatic and volatile economic growth World economy suffered prolonged downturns in the 1870s and 1890s: Great Depression Businesses engaged in ruthless competition Attempted pools, trusts as means to stabilize the marketplace More corporations battled to control entire industries in order to avoid cutthroat competition Economic concentration peaked between 1897 to 1904: 4,000 firms vanished into larger corporations that exercised unprecedented degree of control over market E. The Rise of Andrew Carnegie Rise of business leaders who accumulated major fortunes and economic power Under leadership of Thomas A. Scott, the Pennsylvania Railroad stretched across the continent and pioneered modern techniques of business organization During the depression, Andrew Carnegie set out to establish a ‘vertically integrated’ steel company- one that controlled every phase of the business- and by 1890s, he dominated the steel industry
F. The Triumph of John D. Rockefeller John D. Rockefeller dominated the oil industry Drove out rival firms through cutthroat competition, arranging secret deals with railroad companies, and fixing prices and production quotas Rockefeller began with “Horizontal” expansion- buying out competing oil refineries but soon established a vertically integrated monopoly Industrial leaders were either ‘captains of industry’ or ‘robber barons’ G. Workers’ Freedom in an Industrial Age For a minority of workers, the rapidly expanding industrial system created new forms of freedom Worker’s economic independence determined by technical skill Most workers (semi-skilled) faced with economic insecurity: lost jobs or accepted reductions of pay- many labored sixty-hour weeks with no pensions, compensation for injuries, or protections against unemployment
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