welcome historians or how's everyone doing today we're going to be going over America's Gilded Age last time we were covering the topic of manifest destiny and pushing westward and today we will be covering the Gilded Age how the American industrial might and system was created expanded trudged on and how various individuals were able to amass an enormous amount of wealth how they were able to build their businesses and eventually grow them to such an extent that they became almost unstoppable and they became monopolies and trusts and so on I love showing this initial poster ride this clip this magazine you know artistic rendition because it shows the the you know halt of the Senate right within the US Congress and you see all of our legislators there right kind of toiling away however in the back as the kind of over Watchers and guardians of the American democratic process you see all of these individuals from steel copper standard oil sugar coal salt all of these large industries and these men are being portrayed as large sacks of money and so this you know theme of greed this theme of you know money involved in politics right and corruption is ripe and so I love this imagery here and if you notice on the top left hand side all the way on the second floor it says the people's entrance and it is closed and it is barred and has a big lock on it and so it is very symbolic that the people are not allowed in the Democrat you know progressions right in Congress however all of these money interests are so it is a very interesting visual cue of what goes on in American politics now some questions to consider for today number one how did the new industrial order represent both new opportunities and new limitations for rural and working class urban Americans number two how did the emergent consumer culture change what it meant to be American at the turn of the century during this point in time many of you know the industries were being born they were created they were expanding and Americans found themselves you know with almost limitless amounts of opportunities to purchase different goods and so what once was a very expensive and limited object now has become more freely available for the public and so consumer culture has now been created and something that we obviously still see today and number three consider the fact that the light bulb and the telephone were invented only three years apart although it took many more years for such devices to find their way into common household use they eventually brought major changes in a relatively brief period of time what effects do these inventions have on the lives of those who use them are there contemporary analogies in your lifetime of significant changes due to inventions or technological innovation so obviously if we are discussing the light bulb / electricity and the telephone they are going to have widespread reach and enormous influence on to society technologically and I love to pose the question to my classes in your own life right in today are there any inventions that have fundamentally changed your perspective in the world and your life in general and we'll discuss some of them but on the very kind of very simplistic basis now that I'm looking on you know my desk all of this tech that we have here cell phones right all of these different inventions that make our life a little bit you know easier but definitely more complex in a number of other ways 10 points for whoever can guess these individuals names so here represented and seeded we have mr. Vanderbilt on the left hand side we have Andrew Carnegie we have JP Morgan and last but not least we have Henry Ford so these gentlemen represent just some of the what are going to be called and termed the robber barons of the day and age these larger-than-life figures that were so wealthy and built up their businesses to such an extraordinary degree that they were almost like living gods amongst men in terms of financial wealth so essentially in today's in today's contemporary analogies they will be the Bill Gates and the Jeff Bezos is or the Elon Musk's of let's say the Gilded Age and so mr. Vanderbilt on the left hand side was famous for his at very at first his steamships right and kind of naval canal trade eventually he got into railroads mr. Andrew Carnegie the next one on the right he was very famous for his production of steel and we are going to be getting into some of his works and so as you could imagine a nation poised to just on the precipice of building up all of your cities and railroads and factories and bridges all of them needing steel the fact that you are now the number one producer of steel right money next up on the right hand side JP Morgan does anybody have a chase bank account a JPMorgan Chase Bank account he was in banking and finance and boy oh boy was he growing his wealth last but not least on the right hand side we have more of the entrepreneur slash middle class man Henry Ford which revolutionized the automobile industry with his various practices on the assembly line and was arguably the catalyst and introduction for automobiles being as widespread as they are today now let us speak of the Second Industrial Revolution this Industrial Revolution was the second second-most the first one we cover in early US history towards the tail end because it developed in Britain and made its way towards the shores of the United States however now that we are getting into the late 1800s slash you know early 1900s we are clearly in the Second Industrial Revolution now the Second Industrial Revolution is different than the first in mainly in terms of scale the first Industrial Revolution that began in Britain they just started to experiment with coal and build factories and have early forms of machinery and so they slowly and from the first and dust revolution moved from textile industries or making things with their hands slowly moving towards a more mechanized economy and mechanized lifestyle the Second Industrial Revolution took that form and catapulted it even further and so now we are truly having large-scale factories large-scale mechanization and promoting these kind of industrial goods and so the United States during this time period had a giant Lee in industrial output some factors that were helping along this train of thought the US in conjunction with westward expansion and that mindset right that once again from the last chapter that it is our god-given right to expand westward and use what God has given us and so amongst that train of thought we will use the natural resources that God has blessed us onto this earth onto this land and use it for our own benefit and so they are using as much resources as humanly possible without considering you know conservation of nature they are growing the supply of labor once again we viewed this from last couple of chapters especially from the westward expansion phase that immigration and the u.s. is still at a very healthy pace if anything it is increasing year by year and so every single year we're getting hundreds of thousands and millions of people coming into the United States so that is a always a fresh influx of labor and expanding markets for goods both internally and externally right domestically and internationally and we also have and see government intervention so the government and various presidents and Congress themselves they end up enacting various legislation to help promote our own industries in the United States and protect them from foreign competitors such as making high tariffs a tariff is essentially an additional tax so if you want to import goods from internationally you must pay a tariff and additional tax however if you let's say buy domestically let's say the tariff would not be there or you would or it would be much cheaper for you to do so so those are some of the things that government can do to sway consumer purchases right once the railroads were expanding westward they began to essentially just give land away for cheap and/or free sometimes to the land to the railroad companies because it would behoove the US government to allow the railroad companies to expand to their greatest utmost extent because this would also benefit the United States to grow in a much quicker pace right and many times the government also gave land to farmers miners last time and last chapter for westward expansion we were looking at the Homestead Act right of 1862 which was giving upwards of 160 acres of land to anyone who qualified and pretty much just showed up and built a fence so the government definitely had some policies right that were expediting all of this by 1913 just right before World War one the United States was producing one third of the world's industrial output now it's crazy to think that 100-plus years later that the United States is no longer gonna be this a large producer of the world's you know goods that role has now shifted mainly to other countries China India a host of these Southeast Asian countries and so the United States has within a hundred plus years converted itself from being the world's industrial output er to being now a consumer economy and we'll get into the consumer based economic stuff pretty soon and so they produce more than Great Britain France and Germany combined and so you know at this point in time we have to keep things in context this is 1913 right before World War one really blasted off and at this point in time the United States is still sort of the newcomer to the world stage the European powers for centuries not decades centuries right now have been the superpowers of the world expanding colonizing around the world spreading their culture and religion right to the farthest reaches that their empires could stretch and so the United States early on from American Revolution right kind of surprised the world with a successful revolution against the mighty British Empire as time went on they began to grow and grow over the 1800s so towards the later end of the 1800s they were definitely being more respected on the world stage but they were still not the big players right as far as the world events you know we're concerned but the fact that they were producing so much was definitely putting them up on the kind of Ashkelon of sort of top powers if you will and so as we're going through the Second Industrial Revolution another major transition that we had that is different from the first Industrial Revolution is that now our agricultural farming society that Thomas Jefferson and other original founding fathers loved and thought that it was the bread and basket of the American ideal and democracy all of that is now being shifted towards a an industrial society what does that mean what is the difference an agricultural farming society is one where the majority of the population of a nation would be farmers right they'll be living on farms and they will be producing some type of agricultural output however migrating into an industrial society means that we now have these large cities being built around the nation and that people are migrating to these cities for work mostly and usually right work in factories and so this is an enormous shift because now we are seeing people going from land owning independent farmers towards becoming working-class employees for companies corporations businesses mining operations what-have-you and so the entire mantra or mentality within America started to shift and change so instead of let's say you owning I don't know 20 30 40 whatever acres of land or maybe 160 plus acres depending if you had that Homestead Act available to you owning all of that land and being proud of the work that you do your toiling the land with your own hands maybe hiring a few other farmhands right but it is your land you are a proud owner now you're moving into a very cramped dirty city usually and you're getting paid minimum wage right to work on these factories but you're living in the big city so things definitely started to change culturally socially and economically and so this during this time we see this massive migration to the cities from 1870 to 1920 over a 50-year period of time we see approximately 11 million moving from the farms to the city and in addition to that an extra 25 million or so immigrants arriving on the coastal cities so if you could imagine these large cities on the coast of America they are just being bombarded with population right and so this allows for the cities to grow expansively right and be become these large metropolitan cities however there is a detrimental cost that in terms of overpopulation dirt disease filth etc let's look at the railroads under mr. Vanderbilt the first of our large kind of robber barons so the railroads mr. Kearney and Cornelius Vanderbilt's he was a businessman who built his wealth on railroads and shipping initially most of his business was having shipping alongside canals and rivers right he would be the guy who owns all of the boats and would help you transport all of your goods and services however later on he started to migrate towards the railroad industry because he saw the lay of land he saw that the railroad are going to explode as a business and industry and so especially with all of the increased flow of immigration in people in the United States he knew he knew that transportation would be the key element for these people getting around and so you might as well be there to profit from it and so he started to create this large railroad Network you know throughout the US and building and in putting all of this rail into the ground and so to do so he cannot you know fund all of that himself it's very costly and so he started to ask local state and federal governments for loans in which he was getting millions upon millions and in addition he wanted the rights and grants to those lands so that you can own the land of all of the railroads that you are building across the US right because you can't just simply just build railroads through whoever's land you need to get you know rights for it and so this is where the term robber barons ended up becoming a thing and forming so the farmers the people who owned the land throughout the US and some of that land right because the railroad is cutting through them they started to refer to these individuals as robber barons because they were robbing them they were stealing the land right as far as the farmers were concerned so that is how the name was created that is how the name eventually stuck so from 1860 to 1880 we see that the mileage of railroads tripled and then once again from 1880 to 1920 it tripled again so as you can see it is an explosive amount of rail at the end of the Civil War we had around 35,000 miles of railroad by the 1900's there early 1900s we had almost 200,000 miles of railroad an enormous you know continuation one advantage that we also got from the railroads was time zones today we live in an era where Pacific Air Pacific time Eastern time Central time right that's a normal thing for us however that was not the case back in the day if you were traveling everyone just kind of had the local time and that's it but the fact that the railroads needed to have a precise measurement of time for their tickets and to know when the trains are going to arrive because of the railroads they actually were they created the time zones right and that the United States ended up adopting it into the modern day and we still use this today and then some national branding was created here as well and so because of all of this inter connectivity between the East the West the north to south and all of the u.s. in general because of these railroads are making transportation that much faster companies are now able to market themselves and to sell their goods across the nation so instead of you just having a local shop and store in let's say New York State and just the New Yorkers know about you and your produce and your product now because the railroads you could possibly ship all the way to Florida you could ship to Texas right all of these things are opening up to you so we start to get the rise of national brands as well if you have the time please look at this video of Vanderbilt's life and business it is a great look at how he got started in the shipping industry and the rivers and the canals and how he slowly migrated towards the building of the railroads unfortunately towards the end of his life his railroad dream was cut short because he essentially was bankrupted by some of his competitors because this is a ruthless business once you get into the high levels of wealth and so at the very end of his life he ended up being poor destitute and died shortly after and so his friend and mentee which was Andrew Carnegie he it broke his heart to see Vanderbilt at the end of his days and at the end of his luck in that circumstance but here is mr. Vanderbilt definitely you know one of the I guess founding fathers of the Second Industrial Revolution right if you want to coin it as such here's a wonderful here's a wonderful sort of like a cartoon magazine cover right and so it sees Vanderbilt on the left-hand side riding two trains and then on the right hand side right we have Erie Railroad let him rip Commodore but don't stop to water or you'll be beat this is a this is a fun friendly competition essentially amongst the railroads and so Vanderbilt was attempting to grow and expand his railroad Empire and so he had his railroads but then he would try to buy out other competing railroads so you are going to become the one big railroad company in the US but some real roads such as Erie Railroad Company did not want to sell to them funny enough all of this animation and caricatures right just remind me of the Monopoly game right buying the railroads doesn't give you too much money but still helps this is an interesting one so we saw this photo before during manifest destiny I believe in the last chapter and so as these railroads are being built some of the railroads there was to coming from the West because most of all of the cities and everything that we had was on the East Coast and they were pushing westward hence westward expansion however one of the railroads was actually created in San Francisco right on the west coast and they started to build inland because the goal was to have a connected railroad from east to west because the first company that could do such a thing would make vast amounts of profits because everybody would be using your railroad to gun towards the west and so finally once they started to make the intercut the Intercontinental railroad they finally met and had champagne and it was a huge celebration and they ended up hammering a golden Spyke as a celebratory kind of measure into the ground now if any intelligent astute person was there at that ceremonia that day they probably would have waited till 4:00 a.m. and then dug up that gold you know nail and come back home to their significant other and be like honey that's it right we've struck it rich let's go to the Caribbean here's a wonderful photo of the railroads criss crossing through some of the territory in the southwest definitely right building and advancing as much as possible so the railroads were seen as the artery and veins right in the lifeblood line of America and and westward expansion at that oh this sad to say the railroads were also connected in an inhumane way towards the buffalos last time we were discussing the eradication and genocide and you know warfare against Native Americans by all of the settlers and white populace the railroads expediate 'add the death of the Buffalo's because people whether settlers by themselves or whether from the US Army as specific mandates they started to kill off the Buffalo because they understood that the Native American tribes in the Great Plain region were living off of the buffalos and they were part of their lifestyle their food their economy their everything and so they started to kill them on mass just for the sport of it just to start to dwindle their numbers and this photograph is an enormous pile of skulls of Buffalo just to give you a perspective right on some of this and the railroads were aiding in this because they sped up the travel they sped up the progression of all of these settlers and so a lot of times people even on the railroads themselves as they were traveling let's say if you're on the rail and you're sitting there and you're enjoying your travels and then you see you know this massive buffalo herd on the left or right hand side you would just take out your guns and start to shoot some of them for sports and just you just leave him dead and so unfortunately the Buffalo population was devastated all the way up to almost extinction however in recent years they have slowly been increasing their numbers Andrew Carnegie the man the myth the legend Andrew Carnegie is a second of our robber barons that we were going to look over and perhaps one of the most famous he has an amazing story and I believe I spoke of this last time but we'll get into a little more detail today so Andrew Carnegie was born in Scotland in the UK in 1835 during the textile industries his family were Weaver's Weaver's meaning that they were you know sewing everything by hand and so you know the textile industry was still the old school way for centuries for people to weave everything and make things by hand make your own product by hand however on the onset of all of this industry and factories growing in the UK they were run out of business they didn't need them anymore because a textile industry it's successful one let's say in the 1700s or before let's say if you're very successful textile industry is employing one or two hundred employees right everyone is working their hands and making the goods and you're very productive and then all of this new machinery comes about and the machinery alone on a daily basis can do the work of 50 people and you barely have to pay anything for it right it's much cheaper for you to keep the Machine than the people so what they would end up doing is buying two three four five or whatever different machines and instead of one or two hundred employees you probably just have like 10 20 just to oversee the machines and so the entire industry to shift from hiring individuals to create all of this all of these goods towards hiring low income or low wage earners to just oversee the machines right they no longer even had to have any knowledge or skill of how to make things by hand eventually they just taught any person that walked through the doors and wants a cheap fast pay this is how you handle the machine it took clogs this is how you fix it and that's it let the machine do the work and so the entire industry writing the business models started to change but Andrew Carnegie's family because now they were unemployed and they were facing poverty debt a dire poverty at that his family ended up immigrating to the United States for a better life it is interesting because there is various videos and writings well there's various videos we can watch on it but there's there's like writings on Andrew Carnegie's speaking about his family and then on more than one occasion he writes in his book biographies that his mother all throughout his childhood her dying day kept cursing his father because his father failed at being a man his father failed to provide for them financially and so growing up Andrew Carnegie would always keep hearing essentially your father is nobody your father is a loser etc and so that I'm supposing drove some of his early intellectual development and ambition towards understanding that money for him in this day and age was paramount and so once they got to the United States they hit the east coast and they you know started to all work and during this day and age there's something with there's nothing close to child labor laws if you were 12 13 14 you're gonna start working if your family needs the money and so he ends up going to work and becoming essentially an errand boy right a kind of PA I guess for the railroad companies under Vanderbilt right and others and so he is very quick on his feet very successful he ends up you know rising through the ranks and he was one of the only people at that time that could that learned how to hear Morse code so instead of Morse code people needing to have some type of you know sheets in front of them right to remember what everything means he was just doing a freestyle and so they ended up seeing all of this kind of ingenuity and genius and all this fire in his belly and so they started to promote him even faster and so he started to get promoted faster and faster and saved up enough money to buy his first steel mill after he bought his first steel mill he ended up buying a second a third a fourth and started to grow his steel Empire now one of the interesting things is that he it was a an enormous bet at that point in time steel because most bridges and railroad they were still using iron iron is different from steel in a few ways so they're essentially the same but steel requires additional processing to strip out the additional carbon from the iron hence making it even more rigid and strong but also flexible at the same time so steel is more flexible and much stronger and does not rust as easy and so steel at the time was extremely expensive to make and so as he was starting his early career in businesses it was very slow but once he started to prove to people that listen steel can be made for bridges steel can be used on railroad tracks and steel also can be used for all of your buildings in the cities to make all of these wonderful skyscrapers that were not possible using iron they could not hold up that enormous amount of weight but steel beams could so him over time advocating to people right and selling his steel business started to really you know you know snowball and so by the end of his life he owned pretty much all of the steel industry in the United States and towards the very end JP Morgan ends up offering to buy out his steel company which was the most successful company in the world of steel at the time and surprisingly he said yes and so the story goes that JP Morgan wrote down on a piece of paper a number handed it to him and he said I agree and so it was to the cool some of I believe four hundred and twenty or four hundred forty million dollars not adjusted for inflation so if you adjust that for inflation in today's days that's God knows how many billions of dollars so overnight he became the richest man in the world ah interestingly though as this quote at the bottom says the man who dies rich dies disgraced he understood and believed that in the first half of somebody's life they should be earning money and making money the second half of their life they should be giving it away and so he was the first person publicly and in all of his biographical works to state and commit the majority of his wealth the vast majority if not all of his wealth to charities and donating into building schools and libraries and all of these public works and so he famously started that tradition and others such as in the modern day like Bill Gates and a few other billionaires have also promised to give the majority of their wealth to charity upon their death now this is a wonderful video detailing Carnegie's life and having some historians and authors here comment and critique on it so if you want to watch this video please do so it gives you a wonderful encapsulation of Carnegie and his life here's some a sketch of Carnegie's steel works in Ohio some of the kind of early form steel works and plants that they had but as they were getting bigger and larger and more advanced we start seeing these large you know these large sort of industrial paths where I kind of with all of the melting or in them that you have to heat up to extreme degrees and so the working conditions here were very difficult right breathing in a lot of the dust and a lot of the fumes you know heating things up and just having temperatures go up to a hundred or 120 degrees right you're just glistening and sweat as you're working so very difficult jobs however steel ended up building the majority of the u.s. at this time it was the lifeblood of the United States and these steel mills were some of the most productive in the world and so Carnegie and his Steel Works ended up developing and growing a reputation around the United States and the world as being this industrial might right to grow entire cities so definitely a good bet on Carnegie as he started you know to develop his business and he wrote some various works himself one of them being the Gospel of wealth that he had a very interesting take whereas other big business moguls were so wealthy at the time that they pretty much just kept the wealth to themselves right and gave it to their children but Andrew Carnegie saw that just giving and handing out all of the wealth to your children was going to ruin and spoil them rotten and he started to think about the role that he had in what kind of responsibility does such a wealthy mogul half towards himself his family and his community / nation at large and so he wrote the Gospel of wealth because he was trying to find a proper use for his vast wealth and so he says here poor and restricted are our opportunities in this life narrow our horizon our best work most imperfect but rich men should be thankful for one in estimable boon they have it in their power during their lives to busy themselves in organizing benefactions from which the masses of their fellows will derive lasting advantage and thus dignify their own lives so essentially he's saying here rich rich individuals should be thankful for their prosperity and they should consider that the masses have given them this beautiful advantage and so you know they must dignify their own lives by doing the following second half the quote this then is held to be the duty of the man of wealth first to set an example of modest unhhhh often tatius living shunning display or extravagance or to provide moderately for the legitimate wants of those dependant upon him and after doing so to consider all surplus revenues which come to him simply ask trust funds which he is called upon to administer and strictly bound as a matter of duty to administer in the manner which in his judgment is best calculated to produce the most beneficial results for the community the man of wealth thus becoming the mere agent and trustee for his poorer brethren bringing to their service his superior wisdom experience and ability to administer doing for them better than they would or could do for themselves so essentially that second half of the quote says do not spend your wealth on all these lavish ostentatious things do not go and buy a yacht do not go buy a mansion instead use all of this god-given prosperity and wealth that you have attained to the benefit of others to the benefit of those who cannot do for themselves to the poorer countrymen that you have and so this is a completely radical idea on extreme wealth at this moment in time in this day and age which Carnegie definitely was on the forefront of this kind of train of thinking and then you can read this this as well and so this is part two of his gospel of wealth in essence him saying bestowing charity and aiding others right is the true joy of life and that if you are going to you know really wants to do some good in the world you have to you know give to others it is not only rewarding to buy stuff for yourself but it is more rewarding to actually uplift others right and see the smile on their face and help them help themselves now that we have covered steel let us cover oil for all of you driving on the roads well in the modern day it is definitely the key one of the key ingredients of our modern civilization and sooner or later oil is going to run out and then it'll be interesting to see how the US and the world's transition from a life of oil based economics to a life of post oil-based economics but in this day and age for the Gilded Age john d rockefeller was the robber baron right there's the huge mogul for oil so he was a businessman and philanthropist and is considered one of the wealthiest americans of all time and one of the richest he was born into a large family new york but too modest means he was helping his mother do chores earning extra money around the farm in the house and so over time he learned from his studies that there was a colin led1 Drake who struck black gold in Pennsylvania and so that was the name of oil black gold because it was so red and could make you extremely wealthy because of the enormous amount of properties that oil created so essentially during this day and age they were starting to develop the means of what does oil do how can we convert oil into fuel and they found out that oil and it's still true today that oil has one of the largest ratios of return right in regards to energy if you burn X amount of oil it gives you I forgot what the number is like 13 times the energy right that you put into it which is an enormous amount that we still have not yet been able to replicate as well so oil truly is that Golden Nugget of a substance and if you can sell it you will make literal gold and so he initially worked with a few of his friends but in 1870 he tried to venture off onto his own and created the Standard Oil Company initially valued at 1 million now over the course was lifetime it was eventually probably valued in the hundreds of millions but Johnny Rockefeller is a perfect example of what we call the creation of a monopoly and no not monopoly the game Monopoly the economic the economic term for buying up all of your competition so a monopoly is essentially once you create a business let's say on your street if you buy out all of your competition and you were the only business that can provide that good or service you now have a monopoly on the market you are the only business that is able to provide that good or service so eventually you could just raise the prices or do whatever it is that you want and so in the modern day in context today we are definitely starting to see some other monopolies starting to grow or develop Amazon is probably the largest target in terms of monopoly because more and more people are going to amazon for their online purchasing and they've just become this huge mega left/right of online business and consumerism and so mom-and-pop stores are shutting down nationwide and so many are critiquing and saying that amazon is a monopoly and that they should be broken up because they've gotten too large for their own good however we will see as time goes on whether the US Congress wants to attack such large businesses and truly say that they are doing a disservice right to the nation here's mr. Rockefeller on the left-hand side in his early days just starting off Standard Oil just kind of you know beginning his entire endeavor and on the right-hand side you know him towards the later end signing whatever paperwork he needs to sign on a daily basis right probably a very busy individual and so let's discuss trusts and business competition a little bit so with all of this economic boom and prosperity going throughout the world there was a few legal codes that were governing business affairs but for the most part laws did not catch up initially so if you want to consider it this way as the Second Industrial Revolution is truly advancing as all of these businesses and moguls and companies are making ludicrous amounts of money and power and influence the legality of the nation the legal system has not caught up and so many things that they were doing which in today's day and age would be considered illegal back then it was free game right it was open season and so we have the creation of trusts legal devices used by rival companies where they were managed by a single director what does this mean this means that a bunch of these different companies would get a get together and discuss business and say listen let's say in January in February it'll be your month to charge extra right and kind of have all these goods and services and for you to suck up some of the business and the money from the people the next two months you back off a little bit we'll give all the money in business to these individuals right and so they were kind of playing the market and manipulating the market for their own benefit so that's something you cannot do today but in this day and age once again if the law does not state anything you know open season and so we started eventually to get what was known as the economic mafia that because they began to coordinate all of their different companies in order to best scheme against the people of the United States against the consumers of how to best make money and they were named the big three Carnegie steel JP Morgan investing and rockefeller oil they were the big players of the day and age and the largest I guess today's big three would be if I had to consider off the top of my head Apple Amazon hmm and either Microsoft or Tesla I think I'm not sure what or maybe we should replace that with one of the oil companies because Big Oil is still a viable business but either way right the these large huge companies and corporations ah this is an interesting slide very important slide so make sure to write good notes on this one we will be discussing vertical versus horizontal integration and actually defining robber barons and what does it all mean so vertical integration means that you had some companies like Andrew Carnegie steel that were buying up different processes to pretty much ensure that from A to Z the product that they were making was completely and utterly under their control and so from Carnegie's perspective he ended up out the actual land and the mines that the iron ore would be located in he ended up buying out the transportation manufacturing and distribution of all of this that would end up leading his steel into the hands of its consumers and so essentially he got rid of all of the middlemen in business he said I will literally control every aspect of the product and so that's why they call a vertical vertical integration because literally from the ground from the earth you control from the raw materials all the way up towards the distribution towards the consumer so in a very kind of vertical manner and so the perfect example of this was on Andrew Carnegie because he was he was controlling every facet of the steel production modernly we could make the same comparison and say that Apple is integrating vertical integration because they have very good stringent controls on their phones right and their tech because the iOS they control the chips and the internal of the phone the control and the phone themselves they are in complete control of the entire process of making one of these phones versus let's say an Android phone where they let's say of you know all these different companies they're bringing in random you know kind of Android software but it's not their home proprietary blend of a software Apple controls every facet of it now looks like our horizontal integration horizontal integration was used like we described with john d rockefeller so horizontal integration says that when you are in business of whatever particular type you buy out all of the competition within that marketplace and so john d rockefeller ended up buying all of the other oil refineries in the u.s. that he could find and at a certain point he controlled 90% of the US oil now once he got to that point of owning 90% of the United States oil industry later on we started getting the US government finally being wise and privy to all of this and creating laws to prevent them such as the Sherman Antitrust Act and so they ended up busting these Trust's and busting these large companies and so eventually Standard Oil was disintegrated into smaller oil companies because they were too big right he owned too much power and influence and so here we get the official definition of robber barons incredibly wealthy tycoons who wielded power within their own company and industry without any accountability within an unregulated marketplace and so the main three things here they owned an enormous amount of power they had no accountability they just did what they want and unregulated marketplace because the US Congress at that point in time had did not have the laws necessary to reel them in right they were just doing whatever they could to make income and money and in 1894 we get this wonderful piece of critique called wealth against Commonwealth by Henry Lloyd and he was discussing Rockefellers unfair economic competition and him manipulating the market by bribing legislators so essentially he was seeing the early forms of lobbying in this country where Rockefeller and others were using their money to essentially bribe us legislators and so we still see this happening and occurring today in its various forms and you know history although sometimes it does not repeat itself from Mark Twain's famous quote history definitely rhymes it has rhyming beats throughout history and we see here early on that they are pouring money into Congress and I'm pretty sure nobody today would dispute the fact that Congress has become a bit didn't write in all of the financial dealings with companies and institutions here we have a beautiful sort of visual representation and picture a quantum magazine you know drawing description of Standard Oil and making it look like this large you know octopus like you know a monster that has his tentacles wrapped around Congress has tentacles wrapped around other legislators on the bottom right with their papers in their hands and the tentacle is slowly trying to go in and wrap itself around the White House the executive branch and so you know at this point in time yeah senator Doyle because they did own 90% of the oil production in the u.s. they it definitely exerted an obscene amount of control against anyone that they wanted to go up against now let's discuss another invention under Alexander Graham Bell the telephone boom so he was also a Scottish born American inventor and so he was credited with inventing and patenting the first practical telephone he also co-founded the American telephone and telegraph company do you notice the acronym American telephone and telephone company AT&T this is the early onset of AT&T folks and so within 20 years of the first cable lines being laid Western Union controlled 80% of the country's telegraph lines operating nearly 200,000 miles of telegraph routes so the telephone really started to branch off into its own obviously because it was the fastest form of communication no longer did you need to write a letter and hope for a response within a couple weeks you could just call the person up and get an immediate response so much faster that's so the patent for the telephone so although the telephone was initially patented by Alexander Bell in 1876 he was not the first one to invent and actually conceptualize it but he was the first one to truly capitalize Western Union would later Commission Thomas Edison to invent a more improved version of the telephone because the first versions were a little large and clunky but the more refined versions the truly kind of usable ones they could use in your homes were used later on and invented by Thomas Edison so fearing a lawsuit from Bell they sold Edison's idea to the Bell company and so Bell company ultimately became Wright AT&T and had the wonderful new invented improved version of the telephone that was attributed to Edison and so here is Alexander bell on the left-hand side having that first conceptual ideas and then the telephones over time were able to get more and more refined and usable and so to the point of you know is just trial and error right trying to use as much as possible as many inventions as possible to see what the correct ratio of the telephones would be and especially trying to make it as usable as possible so that eventually you could put them in every home every bar every saloon every governmental building and so you would have all of these various kind of early form telephones here arguably in our day and age everyone or most most of you in your age range and demographic probably don't use telephones as often now it's all texting and SMS and emojis so every generation it seems has their form of communication now Edison and electricity arguably the single most important innovation in the last couple hundred years the single-most the invention of electricity because if we did not have electricity all of our discussions of phones the internet computers all of it would be absolutely rubbish right and would not exist so the fact we are that you are watching this video right now on your laptop or tablet or iPad or whatever is a testament to Thomas Edison so if anything as a modern society my personal opinion is we should probably have a holiday called Edison day because he brought us right electricity but he spent so much time developing all of his various gadgets you know to explore electrical power and eventually all of his electrical power you know research would be used in mass communications sound recording motion pictures all of you movie lovers out there he famously said that he hoped to have a minor invention every ten days and a big thing every month or so he had over 1,000 registered patents over his lifetime which is an a crazy amount he was a an inventor extraordinaire some other notable inventions that he made the phonograph the mimeograph machine motion picture projector right for the movies dictaphone and a storage battery that could store electrical power so once again all of our battery power that we have today would not exist without all of this early form tech he also invented the lightbulb in 1879 he explored over 6,000 materials to get that perfect combination and solution to make the light bulb so it you know he's a perfect example of if it doesn't work once or twice try a few thousand more times and you'll eventually get there he also used direct current called DC power but this DC power or essentially just like the power lines right they were transporting electrical current was only limited to two miles or so it's a very short range so that's not great in terms of talking about like massive cities right because you need electricity to flow to other parts of the city so George Westinghouse comes into the picture he was an engineer who invented alternating current or AC power which could travel far greater distances so essentially the way DC power works is DC power is in a very flat line but that flat line does not travel far AC currents they started to make was traveling in waves like this and it traveled in extremely far away and so from all this combination tack right this is the early on forms of what life is like today and will be absolutely different if right these individuals did not invent what they had invented so definitely a very interesting thing to see and study here's the that famous AC machine by Westinghouse I'm creating essentially the opportunity and possibility for us to have electricity go into long distances right and create these big metropolitan cities eventually having as we see here Westinghouse electronics you know these large factories that were just power houses literally power houses that were transfer electricity to the rest of the city now let's discuss a little bit of class politics because as you could imagine as these various individuals are getting wealthy above and beyond anything that anyone could have ever predicted there is an inevitably going to be an accumulation of power and money in the hands of a few and the rest having less and less access to resources so essentially the uneven distribution of wealth something we are critically seeing today you know on mass worse or on par to what was going on in the Gilded Age I believe personally right now we are in the second Gilded Age or whatever the equivalent would be so by 1890 the richest 1% of Americans controlled the same income as the bottom half of the population and owned more property than the other 99% sounds very very similar to the modern-day folks and because all of this income inequality was getting worse and worse we start to get the theory of the leisure class and on the precipice of the turn of the century by historian Thornton Steen Veblen and he published that the upper-class lavish culture of buying all of these goods and dressing up you know in extravagant silks and having these cars and mansions and whatever focused on conspicious consumption what that means is that spending was not needed or even wanted but they simply needed to spend the wealth to show and demonstrate to everybody that they had it right it's a it's an amazing thing to look at and so examples of all of this lavish lifestyle building would be these big palatial homes and mansions that they were building exclusive social clubs that you had to pay the top dollar for let's say like equinox gym today who has 300 something dollars or whatever however much it costs to pay per month for equinox right schools colleges private balls intermarrying within select amounts of families so the entire class differentiating system between the haves and the have-nots truly starts to become apparent here here we have a visual representation of the expansion of all of the railroads right and all of this migrations and this is a wonderful map so here visually to represented in 1860 the the level of railroad development and then fast-forward to 1870 we have the first Intercontinental railroad C from 1860 then boom 1870 Intercontinental railroad and then from 1870 to 1890 complete and utter railroad expansion so things are really really picking up right life is truly picking up at this at this point aa Gilded Age politics since we're talking about money and politics and corruption William tweed boss tweed he as he was called he was essentially the mafioso man of the day and age and well we'll get some in a second after we define what the Gilded Age was so the Gilded Age as we this entire section is named Gilded Age but instead of merely giving the definition in the very beginning it was prudence I I believe to go through all of this history and to show how much money disparity we saw and how much technological innovation we saw to kind of put all this into perspective so what was the Gilded Age it was a title from a Mark Twain novel the Gilded Age meaning covering something in a layer of gold but masking a deceivingly Hollow and little value core so if you guild something you are covering it in gold and making it look beautiful but it is deceiving because inside it could be rotten and Hollow and so the Gilded Age was essentially America and business right looking beautiful and glamorous but once you look in depth and inside a lot of problems right with society and uneven uneven distribution of resources and more boss William tweed he was a Democratic Party political machine politician who had a lot of influence in New York and I don't know how to feel about this guy I'm honestly torn even to this day and age I've discussed this man in many different occasions and I am honestly torn because on the one hand he was stealing money from the government and charging all of these expensive building projects and you know charging like five six seven times what they should have cost and that he was pocketing the difference so for instance if he said this bridge needs to be built for ten million dollars it probably costs two million to build so he kept eight million for himself so he did this time and time and time again and he stole anywhere from forty five to two hundred million dollars we are not exactly sure how much he stole but at the same time even though he was sucking up the money he was pretty benevolent in New York he was helping people find jobs he he as soon as like let's say many immigrants came to this city and state of New York he would help you as an immigrant family settle in the right neighborhood send your children to the right schools find meaningful employment for you like he would truly help you out the only thing he would ask in return is now that I've helped you out when time comes you vote for me doesn't matter what it is you with me and so he would start to create these loyalty connections right so eventually he was obviously caught and jailed for all this corruption charges but this shows how some of the Gilded Age politics worked very corrupt not a lot of laws in place and in various instances all of this money being kind of tossed around and stolen right on the side and so finally we come towards the government the slow government that has been watching this transpire for years and did nothing but now they are finally coming back into the fray so we start off with a civil service exam which was a merit-based exam for all of these federal employees so because of the boss tweed Fiasco's they now wanted a better system for their federal employees so instead of you just rubbing elbows with somebody and saying hey this is my cousin just get him in that doesn't work anymore they have official exams to test you out and see if you are good enough for this job that does have political influence so at least it would you know filter out as many people as possible right that should probably not be they're not a perfect system but it helps the Interstate Commerce Commission they needed to regulate railroads even more so the railroads started getting so powerful and so widely used that they started to jack up the prices for farmers and merchants but the US government said listen farmers are critical for this country they feed us you will not raise the rates on them unreasonably and so we start to see that one of the first instances of far more protection here and perhaps the most famous is the Sherman Antitrust Act of 1890 a very important act to remember so put it in your notes this banned all combinations and practices that restrained free trade examples monopolies vertical integration horizont integration trusts essentially everything we just discussed that all of these men did to gain enormous godlike wealth it is now under the umbrella of the Sherman Antitrust Act and they say that no all of this is illegal you are using the system you know and it is not it is not at her adhering to any kind of American ideals or democratic market policies right we have to regulate this it's getting way out of hand and so although some of these laws were a bit weak and general at first it was at least a step in the right direction for the US government to finally say we have to at least intervene to a certain aspect yes free market is always gonna be there yes people are always gonna have their ultimate choice of how to you know have their business and how to make money but we need to make sure that the game is still fair we need to make sure that these individuals are not merely always just gonna be the higher up and wealthy they have to play by the same rules and so now that we have this enormous amount of wealth disparity because we were talking about wealth and equality a little bit before we start to see social darwinism flow and so social Darwinism was used in socio-economic as well as racial prejudices and issues but now social Darwinism was used in this particular context in a very economic way and so social Darwinism is a theory gaining the theories from Darwin himself that the evolution was a natural process in human society where some people are genetically superior and more intelligent than others and thus they are better suited and deserve a better life so they borrowed this from Darwin's original on the Origin of Species work on Lucian his very scientific and biological work when he was in Madagascar working with and studying finches he Darwin himself was making this evolutionary theory right saying Oh animals they evolved over time depending on their location and the circumstances in the environment etc a very nice normal thing that we still use today as the foundation and basis of biological studies but the social Darwinists were taking that and bastardizing that theory and saying well now we can say that various humans in society are more intelligent and thus deserve this wealth that they have gained so this is a cover up for the extremely wealthy in the country essentially saying that listen we acquired hundreds of millions of dollars of wealth and we did so because we are the inheritors of this superior mindset we are genetically superior and we deserve to maintain this wealth all of you poor people sorry you're just dumb and you deserve to stay there and you deserve to you know be alive to better and enrich our lives and so this social Darwinist ik theory was propagated at the height of all of the social inequality and income inequality distribution and you know some of it still exists today if you see how some of the billionaires talk in terms of people especially they are downtrodden or poor or they cannot make it they sometimes talk with some type of contempt at individuals today Congress and many economists and political theorists today are still going through the various conversations and issues of what kind of protections do we need for working-class people should we have a standard minimum wage is it enough right now is it should be should it be increased should we tax these large corporations and more so these issues have not truly gone away these issues are alive and well today and if anything they are even worse today because there's so much more complex with globalism and they crazily complicated tax codes that we have and technology making it you know even more complex to regulate so you know history definitely definitely Rhymes and sometimes repeats itself now with that here's the end of chapter 18 the end of the Gilded Age I hope you liked it I hope you enjoyed this lecture and you know let's not let's not kid ourselves that some of these issues are have definitely you know they definitely sound similar some of the Gilded Age policies that we just discussed and the income inequality still exists today and there are still very large issues to be had and in our day and age right in our lifetimes we are going to have to press the government and Lobby the government as much as possible to try to have them protect us because for the longest of times in my lifetime at least I have seen corporations and wealthy individuals buy the loyalty of all of these congressmen and women and so we definitely have to reverse the trend because this is a land of this is a land for everyone and so everyone deserves equal set of footing and an equal opportunity to succeed and so if people gain wealth and they become wealthy I'm not opposed to that but I definitely want a fair playing field I don't want corporations paying minimal amounts of tax and then they're taking like 30 plus percent out of my paycheck that's not fair so yeah I want it to be more even but with that I will end the lecture and I just want to thank every single one of you for being here for listening as always I will see you on the next one take care [Music]