The Industrialisation of the USA and its Impact on the Country’s Economy and Society to 1890

The industrial development of the USA depended greatly on the industrial policies of the succeeding Governments that ruled the country from its inception in 1783 to 1890. These Governments had in common the policy of encouraging creative inventive minds to produce, and companies to exploit natural resources to manufacture goods by giving them charters that would protect them from any competition. This policy was very successful since new industrial sectors emerged and the existing ones developed from being local in scope to gigantic corporations that conquered international markets.

The great bulk of the inventions and technologies that stimulated the Industrial Revolution reached the USA after its independence in 1783. Such inventions and technologies were related to many domains such as textile, steel and iron, railways…etc. Industrial growth transformed the American society since it produced a new class of wealthy industrialists, a prosperous middle class, and a vastly expanded working class. The labour force that made industrialisation possible was made up of millions of newly arrived immigrants and numbers of migrants from rural areas. The USA gained a lot from its industrialisation since industries flourished and the country developed technologically and economically. However, this development was accompanied with varied and complex social and economic problems. The object of this section is to debate the birth and development of the US industry up to 1890 and its impact on the American economy and society .

Birth and Growth of the US Industry to 1890. 

Since the Founding Fathers rejected any kind of despotic policy, they founded the American Government on the repudiation of all control over the industrial and commercial activities. The general belief was to avoid governmental interference in the industrial world, let competition be free, and promote individual initiatives. In this policy, industry and commerce were subject to free exploitation by the ambition of and the warfare among individuals. Justice could be achieved in commerce and industry by banishing government regulations, and applying the law of “Might makes right.” Therefore, wages and salaries, opportunities for working and investing, and entering business were not left to the arbitration of justice.

The Constitution of the USA, which was adopted in 1787, established the nation’s economy as a unified and single market by levying tariffs and taxes on interstate commerce. The Constitution stipulated that the Federal Government could regulate commerce with foreign nations and among the States, establish uniform bankruptcy laws, create money and regulate its value, fix standards of weights and measures, establish post offices and roads, and fix rules governing charters, patents, and copyrights.

One of the first advocates of government intervention in the economy was Alexander Hamilton who advocated an economic development strategy in which the Federal Government would help in the emergence and development of small industries by providing overt subsidies and imposing protective tariffs on imports. He also urged the Federal Government to create a national bank and to assume public debts that the colonies had incurred during the Revolutionary War. These proposals were not fully applied, but retained the right of the Federal Government to set tariffs on foreign trade.

While Hamilton believed that the United States should pursue economic growth through diversified shipping, manufacturing, and banking, his political rival, Thomas Jefferson, based his philosophy on protecting the common man, the farmer, from political and economic tyranny. He particularly praised small farmers as ‘the most valuable citizens.’ In 1801, Jefferson became President of the USA from 1801 to 1809 and turned to promoting a more decentralised agrarian policy. He was against the creation of a national bank because it would serve the interests of the rich and undermine the rights of the farmers. Eventually, Hamilton’s belief prevailed since the country headed towards its industrialisation.

The origins of the US industry go back to the development of the textile industry. The textile industry started when William Slater, who is considered as the father of the American industry, immigrated secretly to America in 1789 to seek fortune. Although there were British mechanics that had immigrated to the USA before him, Slater was the first that built and operated textile machines. Funded by investors from Providence and assisted by skilled local artisans, he built the first successful water powered textile mill in Pawtucket, Rhode Island, in 1793.

Slater’s organisational methods, later known as the Rhode Island System, became the model for the newly planted textile companies in the Blackstone River Valley in Rhode Island. The Blackstone River’s steep drop and numerous falls provided ideal conditions for the development of small rural textile mills around which mill villages could develop. The Rhode Island System consisted of enlisting entire families, including children, to work in the mills. These families often lived in company owned houses located near the mills, shopped at the company stores and attended company schools and churches .

The next phase in the development of the US industry started with the technological development of the iron industry that enabled the growth of the existing small industries. During the 1830’s, industrialisation increased rapidly throughout the Eastern States like in Pennsylvania where the iron industry made great advances in the production of agricultural tools, railway track, and a variety of structural uses.

Before 1840, furnaces and forges typically stood at the centre of rural iron plantations where forests and often iron ore deposits existed. However, the iron industry experienced profound changes in technology including a major shift in its source of energy from charcoal to coal in the form of anthracite, bituminous, or coke. During the 1850s, furnaces fuelled by anthracite superseded charcoal furnaces, and rolling mills replaced forges. Highly skilled workers, called puddlers, refined and shaped smelted metal producing high-quality wrought iron. The quality and price of American iron enabled US iron makers to compete in the international market from the 1850s.

The iron industry witnessed great technological innovations. The ‘Bessemer converter facilitated the manufacture of steel in large quantities at prices cheaper than iron. The major advances in fuel sources and technology enabled ironmasters to improve in efficiency, decrease costs, and increase output. The steel industry in the USA started when mills manufactured iron and then converted it into steel. Steel mills integrated coke-fuelled iron furnaces to supply pig iron to steel furnaces. The Pennsylvania Steel Company began the first commercially successful production of steel in the nation in 1867 in Steelton at railways’ request for stronger, more durable rails.