The Machine Age (1877-1900) Flashcards
Age of Invention
Last quarter of the nineteenth century
Many technological advances made that generated greater opportunities for mass production
Thomas A. Edison
Invented the light bulb
Led to widespread electricity and power plants
Allowed for the extension of the work day
Economies of Scale
Concept that the lower the cost, the cheaper the product. The cheaper the product, the more they sold. And buying raw materials in bulk for less money
Corporate consolidation
Government made little effort to regulate the rapid economic growth, giving no restraint to companies. Businesses followed the path that led to greater economies of scale, which meant larger and larger business
Holding company
Owned enough stock in various companies to have a controlling interest in the production if raw material, the means of transporting that material too a factory, the factory itself, and the distribution network for selling the product.
Monopoly
Complete control of an entire industry
Horizontal integration
Created monopolies within a particular industry
Several smaller companies within the same industry are combined to form one larger company, either by being bought out legally or by being destroyed through ruthless business practices such as cutthroat competition or pooling agreements
Standard Oil John D. Rockefeller
Vertical integration
One company buys out all the factors of production, from raw materials to finished product.
Problems with monopolies
Rapid growth required lots of money -> borrowed lots of money -> bank failures if the business failed
One major financial panic per decade
Lower class suffered the most
Monopolies created extremely powerful men whose interests clashed with those of the rest of society
Public resentment increased
Sherman Antitrust Act of 1890
Public pressure and resentment led to the passage of this law forbidding any “combination…or conspiracy in the restraint of trade”
Wording too ambiguous - allowed the pro-business Supreme Court to rule as it saw fit
Labor unions declared illegal, thought to be “in restraint of free trade”
Loophole closed with Clayton Antitrust Act in 1914
Andrew Carnegie
Steel mogul who promoted Social Darwinism
Wrote the gospel of wealth
Lacked consistency - argued against government regulation but supported all types of government assistance in business
Gospel of Wealth
Andrew Carnegie’s philosophy that great wealth brought with it social responsibility. He advocated philanthropy, but not charity. Argued that the concentration of wealth among a few was the natural and most efficient result of capitalism
Ways manufacturers cut costs and minimized profits
Hired women, children and newly arrived immigrants who were anxious for work. Paid as little as possible -> poverty and crime in cities
Factories were dangerous
Mass transportation
Expansion of railroad lines, streetcars, and subways allowed the middle class to live in nicer neighborhoods away from the cities, making cities more impoverished with immigrants
Ethnic neighborhoods
Tenement areas where immigrants settled to avoid prejudice
Black and Latino migrants had it worst
Political bosses
Politically corrupt men who helped uh poor find homes and jobs and apply for citizenship and voting rights. They built parks, funded auxiliary police and fire departments, and constructed railroads and sewage lines. In return, they expected community members to vote as they were instructed. Occasionally, they required “donations” to help find community projects