Period 6 Part 1 Flashcards
By 1900 what country was the leading industrial power in the world?
The United States
What were some factors that contributed to the rapid growth of the U.S economy?
The country was a treasure house of essential raw materials for industrialization
The labor supply provided by the hundreds of thousands of immigrants yearly arrival
The United States’s growing population
Their advanced transportation network which made them the largest industrial goods market
Capital was good as Europeans provided wealth for the economic expansion
The development of labor-saving technologies
Efficient patent system which increased productivity
Friendly government policies which protected private property, subsidized railroads with land grants and loans, supported U.S. manufacturers with protective tariffs, refrained from regulating business operations, and limited taxes on corporate profits
Talented entrepreneurs emerged at this time and were able to build and manage vast industrial and commercial enterprises.
What was the nation first big business?
Railroads
What did railroads encourage?
Mass production, mass consumption, and economic specialization.
What was the most important invention of the railroads?
The creation of modern stockholder corporation, and he development of complex structures in finance, business management, and the regulation of competition
In the early decades of railroading what did the building of dozens of separate railroads result in?
Different gauges and incompatible equipment which was reduced after the civil war thought the consolidation of competing railroads into integrated trunk lines.
What did Cornelius Vanderbilt do for railroads?
He used his millions he earned from his steamboat business to merge local railroads into the New York Central Railroad.
What did the great age of railroad building coincide with?
The settlement of the last frontier, railroads prompted settlement along the Great Plains and linked the West and East to create one great national market.
Since federal governments realized western railroads would lead to settlement what did they do?
They provided railroad companies with huge subsides in forms of loans and grants (gave more than 170 million acres of land). The land was given in alternate square-mile sections along the proposed route of the railroad. The government predicted it would sell land to new settlers to finance construction. And, that the completed railroad would increase the value of government lands and provide preferred rates for carrying the mail and transporting troops.
What were some negative consequences the subsides carried?
The land grants and loans promoted hasty and poor construction which led to corruption in all levels of government.
What’s an example of the corruption from the subsides?
Insiders used construction companies like the Credit Mobilier scandal and they would bribe government officials and pocket huge profits.
What happened as a result of the corruption in railroads?
Protests against land grants in the 1880’s happened when citizens found out railroads controlled half of the land in western states.
What two railroad companies built the first transcontinental railroad to tie California to the rest of the Union?
The Union Pacific (UP) and the Central Pacific. They met at Utah in May 1869 where they officially connected the Atlantic and Pacific states.
What was the Union Pacific and what did they do?
A railroad company that helped build the first transcontinental railroad. They started from Omaha, Nebraska and built across the Great Plains. Most of their employees were war veterans and Irish immigrants. They worked under General Greenville Dodge.
What was the Central Pacific and what did they do?
A railroad company that helped build the first transcontinental railroad. They started from Sacramento, California and built eastward. Led by Charles Crocker were workers who were mainly Chinese immigrants that took risks while building (laying down tracks).
There were another 3 railroads built later, what did they connect?
The Southern Pacific tied New Orleans to Los Angeles. The Atchison, Topeka and Santa Fe linked Kansas City and Los Angeles. The Northern Pacific connected Duluth, Minnesota, with Seattle, Washington.
Why were transcontinental railroads failures as businesses?
Though they helped to settle West they were built in areas with few customers and with little promise of returning a profit in the near term.
In the 1870s and 1880s what did railroads suffer from?
Mismanagement and outright fraud.
What did railroads start doing to survive?
Railroads competed by offering discounts and kickbacks to favored shippers and charging exorbitant freight rates to smaller customers. They also tried to form pools where companies agreed to secretly and informally fix rates and share traffic which was an attempt to increase their profits.
What did the financial panic in 1893 do to railroads?
It forced a quarter of the railroads into bankruptcy. So JP. Morgan and other bankers like him took control and consolidated the railroads. With competition eliminated railroads were able to stabilize rates and reduce debt.
By 1900 what was going on with railroads?
There was barely any competition which made railroads more efficient and regional railroad monopolies were created since only a few powerful people now controlled railroads.
How did people try to regulate the railroads?
The Granger laws passed by Midwestern states in the 1870s but were overturned by the courts, and the federal interstate commerce act of 1886 was at first ineffective. Until the progressive era where Congress expanded the powers of the Interstate Commerce commission to protect the public interest so customers and small investors wouldn’t feel like victims of slick financial schemes and ruthless practices.
Why was there a second industrial revolution?
There was a growth of large scale industry and the production for steel, petroleum, electric power, and industrial machinery to produce other goods. Inventions led to other inventions.
Why was the production of large quantities of steel so important?
It was a technological breakthrough. Henry Bessemer in England and William Kelly in the United States discovered how to make high quality steel. The great Lakes region became the center of steel production due to its abundant coal reserves and access to iron ore.