Industrialization on the United States

¶ … Industrialization on the United States from 1870 to 1940

American industry changed significantly after the Civil War. The widespread utilization of machines to replace hand labor as the main means of manufacturing increased production capacity greatly. Inventors developed new products, and businesses made these products in large quantities. Investors and bankers supplied the financial resources that business leaders needed to expand their operations. The expansion of the railroads made the distribution of goods and raw materials over a wide area possible. Many of the big businesses we see today developed up as a result of these and other advances.

Between 1870 and 1916 more than 25 million immigrants entered the United States. This plus natural growth caused the U.S. population to more than double, increasing from about 40 million to about 100 million. Population growth benefitted the economic boom in a couple of ways, it increased the number of consumers enlarging the market for products and it provided additional workers for the recently created jobs developed by new industries.

In the late 1800's, the American railroad system became a nationwide transportation network. The distance of all railroad lines in operation in the United States soared from an estimated 9,000 miles in 1850 to almost 200,000 miles in 1900. In 1869 workers laid tracks that joined the Central Pacific and Union Pacific railroads near Ogden, Utah. This event marked the completion of the world's first transcontinental railroad system and greatly contributed to the eventual rise of big business.

The United States' wealth of natural resources played a significant role in the rise of big business. The nation's abundant water supply helped power industrial machines, while forests provided lumber for construction and wood products. Large quantities of coal and iron ore were mined and turned into steel, which was used to build machines, railroad tracks, bridges, automobiles, and skyscrapers. Other industrially valuable minerals included copper, silver, and petroleum. Petroleum, the source of gasoline, became especially important after the automobile came into widespread use in the early 1900's.

Improved communications also contributed to economic expansion. The railroad improved mail delivery, replacing the stagecoach. The invention of the telephone and the telegraph afforded the rapid communication essential to business operations. This business boom triggered a sharp increase in investments in the stocks and bonds market. As businesses prospered, persons eager to share in the profits invested heavily, providing capital needed to for expansion. Banks also contributed to the nation's economic growth by making loans to businesses.

The expansion of industry had a profound effect on American life. As new businesses sprouted in cities metropolitan populations reached unprecedented numbers. During this period many Americans amassed huge fortunes from the business boom, while others lived in extreme poverty. The sharp contrast between the rich and the poor and other features of American life stirred widespread discontent triggering new reform movements. Little was done to regulate businesses during the 1800's. Business executives formed monopolies in order to wipe out competition and gain complete control of their industries. These monopolies had some favorable effects on the economy, helping make corporations efficient and contributing to economic growth. They also enabled businesses to avoid sharp fluctuations in price and output keeping prices steady.