Industrial Society 1890-1920 Notes: 1/8/06

Economic Growth

• Corporations were changing America. Technological innovations in the nineteenth century fired up the economy. Corporate management and structure powered the economy. The 2 most important technologies were
• The harnessing of electric power, which caused old industries to switch from steam to electric power. Fueled city mass transit. Allowed for creation of Ford's Model T, which was affordable to the general public.
  
• And the gas combustion engine.
• Successful inventions overhauled corporations.
  
• Ballooned in size
• By 1900, railroads were most effective method for corporations to ship goods.
  
• Telegraph lines allowed for communication between businessmen on different sides of the country.
  
• Picked up mass production which increased output and lowered costs. This caused
  
• Machines to replace workers
• Required the selling of large quantities of goods
• Helped to create the advertising industry.
  
• Corporations looked for a new way to insure steady income and protect themselves from the fluctuating business cycle.
  
• Railroads cooperated with businessmen by aligning their rates with them.
  
• "Pools" shared information on cost/profit, standardizing rates, and allocating portions of a business among its owners.
  
• Sherman Anti Trust Act of 1890 declared cartel practices illegal. The laws enforcement was non existent.
• Corporations continued to try and eliminate the competition.
  
• Mergers were a favorite way for corporations to try and control business.
  
• Most notably this occurred with the oil industry, and when American Tobacco snapped up five other cigarette companies.
  
• Size and growth also changed management.
  
• Managers took over the long term planning instead of owners.
  
• Cost accounting methods became prevalent.
  
• Scientific management attributed to Frederick Taylor, who examined the tasks and mechanics of production.
• Made workers unhappy.
  
• Ford attempted to use it, but it was mind numbing, and caused exhaustion and errors due to the repeated singularity of the task.
  
• Turnover forced Ford to raise wages, which was bad for business.
  

"Robber Barons" And More

• Industrialist leaders and their lack of concern for the well being of their workers led to labor protests like the Homestead/Pullman Strikes, and the attempted assassination of mogul Carnegie's right hand man.
• These events forced the owners of these monopolies into thinking that they needed to help the public.
  
• Carnegie advocated a "gospel of wealth" and believed industrialists deserved wealth based on Social Darwinism, but said they had an obligation to donate income beyond their needs to communities (not individuals)
  
• Investigative reporter Ida Tarbell exposed standard oils abusive, monopolistic practices, which caused the federal government to prosecute the company. Owner Rockefeller donated money to set up the University of Chicago, and the Rockefeller Institute.
  

And that's all for class notes. Period 5