Technological Innovation in two minutes
- The telegraph spread along the railroads, the Great Eastern laid a lasting transatlantic cable in 1866, and Alexander Graham Bell patented the telephone in March 1876.
- Thomas Edison ran an invention laboratory at Menlo Park, New Jersey, developed a practical electric lamp in 1879, and opened the Pearl Street power station in lower Manhattan on September 4, 1882.
- Edison's direct current carried power only about a mile, so George Westinghouse's alternating current won out in the 1890s, and in 1892 J. P. Morgan's bank formed General Electric by merger.
- Railroad track grew from about 35,000 miles in 1865 to about 193,000 in 1900, and on November 18, 1883, the railroads set four time zones.
- Henry Bessemer in England and William Kelly in Kentucky found a way to turn iron into steel in minutes, and Carnegie built the Edgar Thomson Works near Pittsburgh around it.
- Steel rails fell from about $166 a ton in 1867 to under $20 by the late 1890s, and cheap steel and electric power made bridges, skyscraper frames, streetcars, and big factories possible.
- On the exam: expect causation questions on how the telephone, electric light, and steel fed urban growth, cheaper goods, and big business; the topic links Period 4 railroads to Period 7 consumption.
Topic 6.5 key terms
- Central station
A power plant that makes electricity for many customers and sends it to them through wires under the street. Edison's Pearl Street plant, opened in 1882, worked this way.
- Investment bank
A bank that raises money for big businesses by selling their stocks and bonds to investors. Bankers like J. P. Morgan's firm financed Edison's electric company.
- Second Industrial Revolution
The wave of new technology from the 1870s on, in steel, oil, electricity and refrigeration, that let American firms make far more goods, far more cheaply.
- Captains of industry / robber barons
Two names for the same rich industrialists. Admirers said they built the country's factories and railroads. Critics said they got rich by bribes, rigged deals and low wages.
- Patent
A government grant giving an inventor sole rights to an invention for seventeen years. It rewarded inventing with a temporary monopoly.
- Connection: Morse's telegraph (Topic 4.5) → the patent boom
Skill 5.B. Morse's telegraph (Topic 4.5, the Market Revolution) showed that a wire could carry news faster than a rider. Patents rewarded whoever built the next link, so the wire led to the ocean cable, the telephone and the lamp.
- Telephone
Alexander Graham Bell's device (patented March 7, 1876) that sends the human voice over a wire as a varying electric current. It joined the telegraph and the ocean cable in the new communication networks.
- Research laboratory
A team paid to invent on schedule, for profit. Edison's Menlo Park lab (1876) paid machinists and experimenters to work on his ideas, and it kept a pipe organ for the midnight lunches.
- Incandescent lamp
A lamp that makes light by heating a thin filament until it glows inside a glass bulb with the air pumped out. Edison's high-resistance filament let many lamps share one power source.
- Alternating current
Electric current that reverses direction many times a second. Transformers can raise its voltage for long-distance lines, so it could travel for miles. Edison's direct current could not.
- Corporation
A business owned by stockholders and run by hired managers. Owners risk only what they invest. Railroads needed the form because no family could pay for a whole line.
- Watered stock
Stock sold for far more than the company's real assets are worth. Buyers pay for value that isn't there.
- Rebate
A secret refund from a railroad to a favored shipper, so the biggest customer paid less than everyone else.
- Pool
An agreement among competing companies, here railroads, to split traffic and fix rates.
- Standard time
One official time for a whole region, replacing each town's sun time. The railroads set four zones in 1883. Congress made them federal law in 1918.
- Connection: Lowell's mill hands
Topic 4.5: the same job Lowell's youngest mill hands held, swapping full bobbins for empty ones on the spinning frames. Same work, a generation later. (Skill 5.B)
- Bessemer process
Blasting air through molten iron to burn out the carbon. It made steel in about twenty minutes. Older methods took hours or days.
- Andrew Carnegie
Scottish-born steelmaker who built the largest steel company in the United States by cutting costs and controlling his supply. He later gave away most of his fortune.
- Protective tariff
A tax on imports meant to shield American makers from foreign competition. One of the pro-growth government policies of the Gilded Age.
Transcript
Quotes are from the historical record and name their source. Lines marked Dramatized are reconstructions.
Three O'Clock
Sept. 4, 1882
Key terms: Central station, Investment bank, Second Industrial Revolution, Captains of industry / robber barons
Lower Manhattan. Two fifty-nine on a Monday afternoon. In a brick building on Pearl Street, six steam-driven dynamos wait.
Twenty-seven tons each. Edison's crew calls them Jumbos, after P. T. Barnum's elephant. One minute to three. Your turn.
Three o'clock. Edison tells a reporter the dynamos will run forever, unless an earthquake stops them. It's broad daylight. Nobody can tell.
Evening comes. A lamplighter starts his round.
New York Times reporter
It was not till about 7 o'clock, when it began to grow dark,
New York Times reporter
that the electric light really made itself known and showed how bright and steady it is.
Now the gas lamps look yellow, and a few windows burn white. Find three places the new light reached.
About eighty-five customers. Four hundred lamps. The bankers who financed the light got it first: Drexel, Morgan and Company, at 23 Wall Street.
Over the next sixteen years, light got cheap. So did steel, kerosene and beef. A few men got richer than any Americans before them.
Were they captains of industry, or robber barons? And who paid the price of light?
The Invention Factory
1840–1886
Key terms: Patent, Connection: Morse's telegraph (Topic 4.5) → the patent boom, Telephone, Research laboratory, Incandescent lamp, Alternating current
Invention was about to get a payroll.
In 1840, Samuel Morse's telegraph got patent number 1,647. By the end of 1898, the Patent Office had passed 616,000.
In 1858, Queen Victoria greeted President Buchanan by Atlantic cable. Her ninety-eight words took sixteen and a half hours. Within a month, the cable was dead.
In 1866, the Great Eastern, the biggest ship afloat, laid a new cable. This one held.
By 1900, a web of cables linked every inhabited continent.
Boston, March 10, 1876. Alexander Graham Bell, twenty-nine, spoke into a machine.
Alexander Graham Bell
Mr. Watson—Come here—I want to see you.
Alexander Graham Bell
To my delight he came and declared that he had heard and understood what I said.
Bell's patent had been granted three days earlier. The working call came second.
Edison's biggest invention was a place: a New Jersey lab where a team invented to order.
Thomas A. Edison
Can build anything from a lady's watch to a Locomotive
…so as to allow of the practical subdivision of the electric light.
Translation: one generator, many small lamps.
Arc lights glared over a few streets. Edison wanted small, gentle lamps, one for every desk. But a bulb alone was useless. He had to build the whole system.
In October 1878, Vanderbilt money and Drexel, Morgan money formed the Edison Electric Light Company. Wall Street knew him already. By his own account, a ticker company once paid him $40,000.
In 1882, banker J. P. Morgan wired his house for Edison light. The generator sat under the stable. A neighbor said her house shook. In 1883, a fault burned his library desk. Morgan kept backing Edison.
One problem remained: Edison's direct current reached about a mile. In 1886, Westinghouse's alternating current lit Great Barrington, Massachusetts. By the 1890s, AC was winning.
The First Big Business
1855–1883
Key terms: Corporation, Watered stock, Rebate, Pool, Standard time
The biggest projects now cost more than any family had. The railroads found that out first.
Track grew from 35,000 miles in 1865 to about 193,000 by 1900. Thousands of owners, many in Europe, bought railroad stock. Washington added land grants and loans.
In 1855, the Erie drew one of the first organization charts. The board at the roots. Hired managers on the branches. Station agents at the leaves.
In 1868, Jay Gould, Jim Fisk and Daniel Drew fought Cornelius Vanderbilt for the Erie. Vanderbilt kept buying shares. They kept printing new ones.
Then they fled to a Jersey City hotel with about six million dollars in greenbacks.
Too many lines chased the same freight, and rate wars followed. Big shippers got secret rebates. Rival railroads formed pools. Farmers paid the full rate.
October 8, 1882. Two reporters board William Vanderbilt's private car outside Chicago. They ask if his fast train serves the public. A Chicago paper prints the answer:
William H. Vanderbilt
The public be damned.
Four days later he told The New York Times the report was wrong:
William H. Vanderbilt
…both my words and ideas are misreported and misrepresented in the report.
The reporter stood by his story. The phrase stuck anyway.
Every town set noon by the sun. Railroads ran on about fifty different times.
At noon on Sunday, November 18, 1883, the railroads swapped those for four time zones. Congress waited until 1918 to make it law.
Bessemer
1848–1898
Key terms: Connection: Lowell's mill hands, Bessemer process, Andrew Carnegie, Protective tariff
In 1848, a thirteen-year-old Scot went to work in a cotton mill near Pittsburgh.
Andrew Carnegie
My first work was done there at one dollar and twenty cents per week.
Like the youngest hands at Lowell, he spent his days changing bobbins.
Then telegraph boy. Then a rising man at the Pennsylvania Railroad, learning what railroads buy most: iron.
In the 1850s, Bessemer in England and Kelly in Kentucky found a shortcut. Blow air through molten iron and the carbon burns away. Twenty minutes, and it's steel.
Andrew Carnegie
There, on the very field of Braddock's defeat, we began the erection of our steel-rail mills.
He named the works for J. Edgar Thomson, the Pennsylvania Railroad's president. Two rival railroads and a river had to compete for his freight.
At night, the converters lit up the Monongahela.
The blower read the flame. When it dropped, the carbon was gone.
We'll come back to the men who worked that heat, and the hours they worked it.
Carnegie chased costs. Steel rails fell from about $166 a ton in 1867 to $17.62 in 1898.
In 1885, Carnegie gave business students this advice.
Andrew Carnegie
I tell you “put all your eggs in one basket, and then watch that basket.”
Andrew Carnegie
Beyond this never earn.
He wrote that to himself at thirty-three. He kept earning until 1901.
Washington helped. From 1870, a tariff added $28 to every ton of foreign steel rails.
Steel went into rails, then bridges, then the frames of the first skyscrapers.
Time to open the ledger. Captain of industry on the left. Robber baron on the right.