The Gilded Age
The Railroad Industry in the Gilded Age
"The golden gleam of the gilded surface hides the cheapness of the metal underneath." - Mark Twain
Reasons for Economic Growth in the Last Half of the 19th Century
Gold Rush- Not only did the gold rush lead to the influx of other minerals, but it created a need for railroads to transfer tools and miners to Sacramento.
Bessemer Steel Process- The Bessemer steel process led to easy creation of stronger steel to be used to make the Railroads and the train cars.
Unfair Selling of Land Next to Railroads- The companies already had the land paid for them to build on so they sold land at high prices to people to make a profit.
Accessibility- Goods were accessible to a greater population because railroads extended business to more areas. More goods were produced and sold to more people.
urbanization- More regions in America went from being barren to populated because railroads could easily transport goods and people and made other places more accessible.
Job Creation- Jobs were created for the factors of production and the workers that where creating the railroads.
Interstate Commerce Act 1887- Prohibited pools and forced railroad companies to publish their rates openly. It prohibited the discrimination against shippers and other unlawful charging. Also Established the interstate Commerce Commission to enforce the new regulations.
Utilized horizontal integration to own all parts of Railroad production to make production cheaper. This allowed Carnegie to maximize his profits. He wrote the Gospel of Wealth which said that the wealthy were called on by God to use their wealth for good.
J.P. Morgan was not only the banker's banker, but also a board member of railroad companies for which he owned large stocks. J.P. Morgan bought out Andrew Carnegie and tons of other steel factories to monopolize the steel industry and create the U.S. Steel Corporation which was the world's first billion dollar corporation.
Vanderbilt was the master behind the New York Central railroad network which helped facilitate growth of railroad lines in the west. He set an example for those railroads by replacing his old iron railroads with more durable steel. He made millions in steam boating as well. As a result of the California Gold Rush, Vanderbilt created a transit line across Nicaragua.
The Gold Rush
Cohen, Lizabeth, and Thomas A. Bailey. "Industry Comes of Age." The American Pagent. By David M. Kennedy. 12th ed. Wadsworth: Cengage Learning, 2002. N. pag. Print.
"Cornelius Vanderbilt." Cornelius Vanderbilt. New Netherlands Institute, n.d. Web. 09 Feb. 2014. <http://www.newnetherlandinstitute.org/history-and-heritage/dutch_americans/cornelius-vanderbilt/>.
"Gilded Age Scandal and Corruption." - AP U.S. History Topic Outlines. N.p., n.d. Web. 07 Feb. 2014. <http://www.apstudynotes.org/us-history/topics/gilded-age-scandal-and-corruption/>.
"J.P. Morgan." Freedom: A History of Us. PBS, n.d. Web. 9 Feb. 2014. <http://www.pbs.org/wnet/historyofus/web10/features/bio/B14.html>.