Latest / Saberian History Lectures / Rail and New Industries

Transcript

Rail and New Industries · Saberian History Lectures

0:00
All right, so we left off talking about emerging
0:07
technologies that came up in the period of 1860
0:10
to 1900, and probably the most central and profound
0:17
was the railroad. And so you've got a couple
0:22
of things going on. The dream of the transcontinental
0:24
railroad goes all the way back to Polk. What
0:29
was one of Polk's goals? That the U .S. should
0:32
acquire what state by force of arms if necessary?
0:37
California. And over the course of the Mexican
0:41
-American War, the United States acquires by
0:45
force of arms basically everything from what
0:50
is in the Louisiana Territory to California.
0:54
So this is the states that will become California,
0:57
Nevada, Colorado, Arizona, and New Mexico. What
1:02
they were looking at was putting in a rail line
1:09
to connect what is now the U .S. West Coast to
1:14
the U .S. East Coast. Now, a couple of things
1:23
going on. This is not a simple task. This is
1:29
labor intensive. And it is capital intensive.
1:34
And so when you're talking about railroad tracks,
1:36
you have to have steel, you have to have lumber,
1:38
you have to have laborers because you have to
1:40
level the ground. Also, a couple other things
1:42
you need in order to get things going is dynamite
1:44
because what is separating, I'm going to go to
1:46
the map, what separates the U .S. West Coast
1:50
from the established railheads? in the Midwest,
1:56
and in the East? The Rocky Mountains. So if you're
2:02
running a train past a mountain, you either have
2:06
to go over, around, or through. And in this case,
2:14
especially when you get in the Rocky Mountain
2:16
areas, I mean, you've got ravines, you've got
2:18
rivers, you've got a whole mess of things in
2:20
the way, yes? And so through dynamite... through
2:23
lots of manual labor brought to you by Confederate
2:26
war vets, Chinese immigrants, and freed slaves,
2:31
you have the Transcontinental Railroad where
2:34
the Union Pacific met the Central Pacific. Let
2:36
me go back before... So this is a bridge that
2:39
they built over a very nice river. There are
2:41
some other documents where they show them literally
2:43
blasting tunnels and, you know, driving... I
2:45
mean, this was back -breaking work. Still is.
2:47
I mean, this is where you get the zong. I've
2:49
been working on the railroad, right? And, I mean,
2:51
they did pull... working sunup to sundown in
2:55
rather harsh conditions, and of course you have
2:57
to take it with you. So this is actually, in
3:00
many ways, what is the hallmark of any great
3:02
empire? Why do we still talk about the Romans?
3:07
Why do we still talk about the Persian empires?
3:10
What set them apart from anyone else? Roads.
3:13
Because fast ways to get from city to city, fast
3:17
ways for your army to transport manpower and
3:19
materiel, but also, and this is the key thing,
3:23
It connects your nation, not just physically,
3:28
but if people can travel faster, also that connects
3:31
people culturally, linguistically. Because what
3:34
else, when the rail lines are finally completed,
3:37
is paralleling the rail lines that is very important
3:41
when it comes to communication. Telegraph, which
3:46
means all of a sudden, news in New York can get
3:48
to San Francisco really, really fast. Does that
3:51
make sense? And so that is also part of the connection.
3:54
So it's not just physical, it's not just commercial,
3:58
although it is, it is also cultural linguistic.
4:01
Okay. Now, here's the thing that's kind of interesting.
4:07
The U .S. government has an... How do you raise
4:10
the money to... Make a railroad. You sell stock.
4:19
So, a couple of things that the rail gives us.
4:21
One is, it changes capitalism. Because this is
4:25
where you get the creation of the modern corporation.
4:30
And so, you have, and if I think about it, railroads
4:42
are capital intensive, And they are land intensive.
4:49
We'll get to the land in a moment. Okay, so what
4:55
does the word corporation mean? I mean, we see
5:02
it on companies all the time. You have people
5:05
maligning the evils of corporate America, yes?
5:09
What does the word corporation actually mean?
5:15
What does corp mean? Corpore. You go to a morgue
5:20
and you see a corpse. What is it? A body. If
5:25
you incorporate something, you make it into a
5:28
body or you make it part of your body. And so
5:31
they come up with a word that means body. And
5:33
so in this case, a corporation is when you go
5:40
from... companies which would be owned by a sole
5:45
proprietor, meaning you have how many people
5:47
owning it? One. That person has assumed the totality
5:50
of the risk and gains the totality of the profits,
5:53
if there is any, to partnerships. Partnerships
5:56
would have how many? Two. Two to a few, yes.
5:59
Where, again, the risk is divided among a few
6:02
principal members, but a corporation, you sell
6:06
stocks. This allows you to diffuse the risk.
6:11
And so, if you buy stock in a company, if that
6:15
company turns a profit, you are paid a dividend.
6:23
So, they take the profit and they divide it by
6:27
the number of shares in that company, which is
6:31
the amount of stock that a person has bought.
6:33
How many of you know if you or your parents have
6:37
bought stock in anything? and so they have a
6:41
certain number of shares of X, Y, or Z, and at
6:43
the end of the quarter, they get a dividend check
6:46
if it is a dividend -yielding stock. There are
6:49
some stocks that do not yield dividends, and
6:51
you hope the stock goes up, and then you sell
6:52
it, but that's a relatively novel idea. And so,
6:55
stocks were tradable. Stocks were valuable. Stocks
7:01
become, in many ways, a currency unto themselves.
7:05
Are stocks represented by gold or silver the
7:08
way other forms of money were? No, so the value
7:12
can fluctuate. Okay, so... The government grants
7:18
the railroads valuable tracts of land so that
7:21
they can do this thing. By the way, after the
7:24
Mexican -American War and even after the Louisiana
7:27
Purchase, who owns the land? The federal government.
7:33
And so the federal government is free to give
7:35
land grants to these railroad companies in the
7:38
interest of improvement. Now, I've often wondered
7:40
if with, shall we say, modern... in positions
7:47
on federal contracts if the U .S. had to build
7:49
the railroad again, if they would be able to
7:52
do so. I think not. But anyway, so here's a bit
7:56
on the transcontinental railroad. You've got
7:58
two railroads that kind of meet in the middle,
8:00
not quite. And by the way, kind of an interesting
8:11
thing, before we get to this, Did the government
8:21
charge much? What does it mean if I have a land
8:24
grant? Grant is what? To give and to receive
8:28
what in exchange? If you go to college and instead
8:33
of taking a college loan, you get a grant, do
8:35
you have to give it back? No. Now, who might
8:41
object to the government of the United States
8:46
simply giving away land to these... Heartless
8:49
corporation. What party might object to that?
8:51
What party of farmers might object to that? The
8:55
Democrats. And do the Democrats have a large
8:57
say in Congress in the 1860s? Into the 1870s?
9:03
No, because where is the bulk of the Democratic
9:06
Party? In the South. Now, there were Democrats
9:08
in the border South. There were Democrats in
9:10
other parts. But no, I mean, this is the beginning
9:13
of the Republican Party as the party of big business.
9:15
But in this case... Was it necessary? If you're
9:24
going to bind your country together. And again,
9:26
it's sort of the, you know, it's something to
9:31
ponder. Alright, so getting to the Transcontinental
9:34
Railroad and then actually putting it together.
9:36
Alright, so let me go to, this is where the Union
9:39
Pacific meets the Central Pacific. And the last
9:42
man drives the Golden Spike. Let's go to the
9:47
map. Okay. So the Central Pacific is coming from
9:51
San Francisco to Utah. Here you have the Union
9:56
Pacific going from basically Chicago all the
10:02
way to where they meet. Now, why Chicago? Chicago
10:12
is connected to all the major cities on the East
10:14
Coast. Also, Chicago is connected to what major
10:17
north -south artery of the United States? The
10:20
Mississippi. Chicago becomes the center of the
10:22
world. Now, is there a rail line that runs from...
10:27
Later on, you're going to have the Southern Pacific
10:30
Line that goes from basically Los Angeles to
10:33
El Paso to San Antonio to Houston to New Orleans.
10:38
which is kind of part of I -10. Actually, I -10
10:40
goes all the way to Atlanta. Really? Yeah. Yeah,
10:44
it's kind of funny because, you know, if you
10:46
talk to people from Los Angeles, they always
10:47
complain about traffic on the 10. You talk to
10:50
people in San Antonio, they always complain about
10:51
traffic on the 10. You talk to people in Houston,
10:54
they always complain about traffic on the 10.
10:56
Haven't talked to anyone from New Orleans because
10:57
the five people I met from New Orleans, I couldn't
10:59
understand a word that they were saying. So much
11:03
for cultural and linguistic unification. But
11:05
anyway, then I had a friend of mine who moved
11:08
to Atlanta and guess what he complained about?
11:11
Traffic on the 10. So if you listen to all these
11:13
people, you're like, good God, does this highway
11:15
go anywhere? And it's not that it's backed up
11:17
from Los Angeles all the way to Atlanta. It's
11:20
just in those cities the traffic is horrible.
11:22
But once you get out of the cities, kind of like
11:24
when you're driving from San Antonio to La Verna
11:26
or to Seguin or even out to Katy. Once you get
11:31
past La Vernia, things pick up. But anyway, why
11:36
would I build a line from Los Angeles to New
11:38
Orleans? New Orleans is a port. Gets us into
11:43
the Gulf of Mexico. From there I can go to the
11:45
Atlantic. Also, is New Orleans thoroughly connected?
11:48
Until recently, is New Orleans connected to Atlanta?
11:52
No. And so, if you're going to move freight...
11:56
from the Pacific Ocean to the Atlantic by ship,
12:02
before the Suez Canal and before the Panama Canal,
12:09
what do you have to do? You have to either go
12:14
all the way around Africa or all the way around
12:17
South America. And neither one of those is a
12:21
win. Or... You can go from Shanghai to San Francisco,
12:27
unload your cargo onto a train, carry it over
12:31
land and pick it up and then go from New York
12:33
to London. Make sense? And so there was a lot
12:37
of money to be had not only into integrating
12:39
the U .S. economy into itself, but also in, for
12:44
lack of a better word, trans -oceanic commerce.
12:47
By the way, what do you get to charge them when
12:50
they bring the stuff in? Tariffs, yes. So money
12:54
going in, money coming out. Alright. Growth of
12:58
corporations. John D. Rockefeller. Also a new
13:03
source of power comes online, which is oil. Now,
13:08
1839 to 1937 is when he finally passes. He hung
13:13
in there, didn't he? 98. That's pretty good.
13:24
Right? Alright. A couple of things. So, you've
13:29
got, and actually you have a whole bunch of big
13:32
businesses that come to mind. The book only talks
13:35
about three. But I'm going to bring up a couple
13:37
others just for your own edification. So you've
13:40
got Rockefeller. And his thing is Standard Oil.
13:49
Now, how many of you... Pretend to know anything
13:54
about oil. Or how many of you have perhaps family
13:57
who engages in the business? Okay. So, oil. How's
14:03
it work? Well, fracking now. So, first thing
14:10
you got to do is you got to get it out of the
14:11
ground, right? Okay. So, you got the drilling.
14:17
Then what? Oil, we get it out of our... out of
14:21
the ground, put it right in the car, right? You
14:24
have to refine it, yes? Nowadays, we refine it
14:28
into a number of different products. Everything
14:32
from gasoline to kerosene to diesel. Also, plastics
14:44
and fertilizers are complements of the petrochemical
14:49
industry. One other petroleum product that you
14:54
don't tend to think of. I'm going to do my best
14:58
Hank Hill impersonation. Propane. Right? Propane.
15:07
Oh, there was an L in diesel, but anyway. That's
15:11
alright. The online audience doesn't see that
15:14
I can't spell. I may leave that one in. I know.
15:18
I may cut that one out of the tape. I don't know.
15:21
So, anyway. And then what? Do you gas up at a
15:27
refinery? Transportation and distribution. Actually,
15:32
you've got transport here. You've got transportation
15:35
from the drill site to the refinery, and then
15:38
you have transportation again to your distribution.
15:48
Oh, one other thing I forgot to leave was home
15:50
heating oil. Okay. Kind of interesting. And we
16:00
don't have a schema for this because we live
16:02
in the suburbs of San Antonio and even in San
16:07
Antonio proper. Okay, let's try this on for size.
16:09
First of all, imagine your kitchen for a moment.
16:16
Are you in your kitchen? Okay. Do you see the
16:19
stove? Is your stove electric or does it have
16:24
a gas burner? How many of you, hold your hand
16:26
up, if your stove is electric? Okay, most of
16:30
you. How many of you have a gas burner? Okay,
16:32
those of you who have a gas burner, are you in
16:35
the city or are you on your own property? You're
16:38
on your own property. Then you either have natural
16:43
gas that's been piped to your house or it's a
16:47
propane tank. Propane tank, okay. In some parts
16:52
of the U .S., especially in the north, similar
16:56
to the way you get propane, they have what is
16:59
called home heating oil, where literally a dude
17:01
drives up in a big old truck, looks like a gasoline
17:03
truck, albeit shorter, and fills up your home
17:07
heating oil tank. It's a petroleum product. It
17:11
is liquid, whereas propane is moved as a liquid
17:15
under pressure, but when it hits room temperature,
17:17
propane becomes a gas. Does that make sense?
17:20
But anyway, home heating oil, kerosene, and also
17:25
other types of things had found their way into...
17:29
So the petroleum market predates the automobile.
17:33
That's the important thing you need to recognize.
17:35
By the way, kind of as a humorous aside, and
17:38
I know any of my environmental friends who might
17:42
be listening to this, one other thing that most
17:43
people don't appreciate about petroleum is petroleum
17:45
saved the whales. In other words, that many of
17:56
the things that petroleum picked up used to be
17:59
derived from whale oil or whale blubber in terms
18:02
of lamps, in terms of cosmetics, in terms of
18:05
oils. And best of all, you don't have to hunt
18:10
it down. And while both oil rigs and whales are
18:14
a dangerous job... Whales are a dangerous job?
18:19
Moby Dick! Alright, well, that's your new assignment.
18:23
You need to read Moby Dick. Actually, and it's
18:27
a great novel. Here you got the guy who's chasing
18:28
down the whale and because the whale had, you
18:32
know, in a previous accident taken his leg and
18:34
finally, you know, it was a very distinct looking
18:38
whale. I mean, it was a big white whale and that
18:41
was the thing. Gold doubloon for the man who
18:43
finds me the white whale. Should I give away
18:46
the ending? One of the great lines, and I may
18:52
or may not cut this out of the tape, is so Ahab
18:56
leaps upon the whale and is stabbing him with
19:00
the harpoon. From hell's heart I stab at thee.
19:03
For hate's sake I spit my last breath at thee.
19:07
And they both go down together. Anyway. I know.
19:12
It's a great one. Alright. Okay, moving on. Oh,
19:17
by the way, oil. While we tend to think of Texas
19:21
as the center of the oil world, the first oil
19:25
sites are actually in Pennsylvania. We just find
19:28
out we've got more of it. Alright, this is Oil
19:33
Creek, Pennsylvania in the 1860s. Again, well
19:36
before automobiles. Okay, then you've got Carnegie.
19:42
Andrew Carnegie. Not to be confused with Dale
19:44
Carnegie. Dale Carnegie wrote the book How to
19:46
Win Friends and Influence People. I often said
19:48
it's a bad joke. I was thinking of writing a
19:50
demonic parody of it. You know, how to lose friends
19:52
and upset people. But anyway. Might be a bestseller.
19:57
Or no one buys it. But anyway. Now, Andrew Carnegie.
20:00
He's the steel man. Now, why might steel be important?
20:05
Railroads. One of the things that... Carnegie
20:09
does is Carnegie exploits the Bessemer process
20:13
before anyone else. Now what the Bessemer process
20:16
does, and this is kind of important because of
20:18
the history of science, Bessemer, it's a process
20:20
in England where basically here's the idea. Steel
20:26
is wrought iron along with a whole bunch of other
20:31
alloys and whatnot. This is why steel is magnetic.
20:33
What are the three magnetic elements, by the
20:36
way? Iron. Steel. Steel is an alloy. It's not
20:40
an element. Nickel. Nickel and cobalt. Iron,
20:45
nickel, and cobalt. Now, steel is principally
20:48
iron. So, basically, back in the old days, to
20:51
make steel, you had to make wrought iron, and
20:52
then you had to introduce some other alloys,
20:54
and that's how you make steel. Now, to get regular
20:57
iron into wrought iron, you have to burn fires.
20:59
They get very, very, very, very hot. And so Bessemer
21:03
comes up with a process where you're forcing
21:05
the air that gets the fire hot enough and it
21:08
reduces your cost. Because again, if you're trying
21:10
to get heat, what do you have to pay for? Some
21:14
heat source, yes? So you're talking wood, coal,
21:17
or in this case, coke. Now, coke, I'm not talking
21:19
about Coca -Cola. Coke is basically, it is a
21:23
refined type of charcoal, but it burns so much,
21:26
much, much, much hotter. And so the Bessemer
21:29
process allows Carnegie to make steel at a much
21:32
lower rate. By the way, what's the importance
21:34
of cheap steel? What would be a big consumer
21:36
of cheap steel? Railroads. Previously, what were
21:39
railroads made of? Iron. The transition of the
21:43
railroad from iron to steel is kind of important.
21:45
One, steel is more flexible, and steel is more
21:48
durable. Okay, why is flexibility important when
21:51
you're talking about rail lines? If it doesn't
21:54
bend, what does it do? Breaks. Now, prior to
21:59
the Bessemer process, steel was... I wouldn't
22:04
say it's a precious metal, but it was worth a
22:06
lot more than it is now, and so steel was typically
22:09
used for... Blade weapons. I mean, again, it
22:13
was a matter of art to it. Whereas even infantry
22:16
cannons were typically made of iron. Or not infantry
22:18
cannons. Artillery cannons were made of iron.
22:21
Very often, firearms were not typically made
22:24
of steel. In other words, it was only the blades
22:25
themselves, the officer swords, stuff like that.
22:27
It was a refined product. So there we go. Alright,
22:33
so that's steel, oil, and they talk about...
22:40
J .P. Morgan. J .P. Morgan should sound familiar.
22:45
J .P. Morgan Chase's bank still exists. He's
22:47
a financier. Now, you also have a large number
22:50
of companies that the book doesn't talk about,
22:52
these large industrial companies that some of
22:56
you might take for granted. Also, in the same
22:57
time period, you have... What does Hershey do?
23:11
Chocolate. What was chocolate before mass corporate
23:16
industrialization of it? Not only that. Not just
23:23
chocolate. In other words, candy would not be
23:26
something you buy at a convenience store. You
23:28
would go to a confectionary or you would go to
23:31
a bakery. It would be a craft thing rather than
23:34
a standardized corporate product. Does that make
23:36
sense? Also, another one, kind of interesting.
23:41
Same time frame. Colgate. Toothpaste. Now think
23:49
about this for a moment. You've got people living
23:51
out in the hinterland who were, I mean, toothpaste,
23:54
if you didn't learn how to brush your teeth from
23:57
another human being, toothpaste is not a natural
23:59
act. Right? So it's kind of interesting. And
24:04
these are just a whole host of different industries
24:07
that crop up in this period of nationalization.
24:12
Now think about this for a moment. While Carnegie
24:17
Steel helped make those rail lines, and while...
24:21
Rockefeller's Standard Oil drove some of the
24:24
need for the steels because he patronizes rail
24:27
a lot for transportation and distribution. The
24:31
profitability of oil may have been a driving
24:33
force behind the railroadization, for lack of
24:35
a better word, of the United States. What are
24:38
the subsidiaries? Well, the subsidiaries of it
24:39
is you now have national markets for things like
24:42
toothpaste, for things like chocolate. Make sense?
24:48
Okay. So why did they do it? Money's good. That's
24:54
not the only reason. These are not people who
24:57
pursue wealth for its own ends. So now we have
25:01
talked about previous American religious doctrine.
25:07
I actually posted a podcast on that one. That
25:10
one's up. So let's talk about one of the driving
25:14
features behind these people, which is the gospel
25:16
of wealth. Many of these men prided themselves
25:18
on being deeply religious men. Now here's your
25:21
basic idea behind the gospel of wealth. You do
25:24
good by doing well. Let me say that again. The
25:29
gospel of wealth is you do good by doing well.
25:32
And so the idea is... You make as much money
25:36
as you possibly can by growing the economy. You
25:39
put people on jobs. And also, you make a butt
25:41
-ton of money. And what do you do with it? Charity.
25:46
Philanthropy. By the way, who here is in music?
25:53
And where is one of the most prestigious places
25:56
you can play in New York? Carnegie Hall. where
26:07
another big performance venue, Rockefeller Center.
26:14
You get the idea. And this gospel of wealth continues
26:19
into the 20th century. Henry Ford was a devotee
26:23
of it. And again, the idea is you make as much
26:26
money as you can in business, even if you're
26:29
doing these monopolies, but then you have the
26:31
ability to give it away. Now, the other thing
26:32
you get into is the idea of social Darwinism.
26:34
The idea of social Darwinism kind of hits the
26:38
stage, but here's your basic idea. What's Darwinism?
26:43
What is Darwinism? We've talked about it before.
26:47
Evolution, natural selection, yes? that those
26:50
creatures who've survived and propagated have
26:52
had some mutation that gave them an advantage
26:54
that allowed them to succeed. Social Darwinism
26:56
is the idea that people who have done well are
27:00
people who have adapted to the situation and
27:04
have exploited it to their own ends, and so the
27:06
idea is that those who have done well are somehow
27:09
superior or more evolved, and that if you can
27:13
do well, you should do well, and people who have
27:15
done badly, well... What is it betoken of them?
27:19
They might be less evolved or less intelligent.
27:23
Does that make sense? Okay. Federal and Republican
27:29
support for the big business. Again, there is
27:32
this idea. What was the fundamental crux behind
27:35
the Republican Party prior to the Civil War?
27:40
What was the driving feature behind the Republican
27:42
Party prior to the Civil War and causes the Civil
27:45
War? Abolition. What was the driver behind abolition?
27:49
It wasn't just, we believe in the equality of
27:52
all humans and we want them to be free. What
27:54
was their driving conviction? It was morally
27:57
wrong. Religious devotion, yes? Okay, so here's
28:01
your basic idea. And this is the part where,
28:09
again, people do not fully understand how...
28:16
What's the word I'm looking for? How you can
28:18
go from abolition to a company of big business.
28:21
To how it went from the party of abolition to
28:23
the party of big business. Here's what it is.
28:26
Okay. So, if I look at the Republicans as creatures
28:33
of the Second Great Awakening. 2GRA. Second Great
28:40
Awakening. The central idea. is that people should
28:48
be free to work. Free soil, free labor, free
28:56
men. Free labor doesn't mean you're working for
28:58
free. Free means that you are free to work or
29:00
free not to. Now, if you are free to work, you
29:04
are free to work to whose advantage, to whose
29:06
ends, to whose purpose? Your own, but you're
29:10
also not just working for you. Who else are you
29:12
working for? If you're a creature of the second
29:13
great awakening, you're not just working for
29:15
you. Who are you working for? You're working
29:17
for God. And so here's the idea. It is you're
29:20
free to work, you're free to work for you, but
29:22
also work itself is a glorification of God. Does
29:26
that make sense? And so you have these people
29:31
work as a glorification of God and in that idea
29:36
was the idea that man's purpose in life is to
29:42
serve God and those who do well by the Lord will
29:44
do well both in this life and in The next. This
29:48
in many ways is different from the doctrine of
29:52
poverty, you know, the vows of poverty and chastity
29:54
that you see in the Catholic tradition. This
29:55
is very much a Protestant tradition. And so,
30:00
then that leads you to the gospel of wealth.
30:05
Now, so why do you have these people who can
30:08
create these corporate monstrosities? Well, is
30:11
it not still that private property is sacrosanct?
30:16
Because, again, if your private property is sacrosanct,
30:23
that makes charity all the more valuable, doesn't
30:27
it? When it's your money you're giving away,
30:29
right? In that regard, a creature of the 19th
30:34
century might regard the idea of taxing a person
30:37
to give charity or to see to the subsistence
30:40
of another. That might cheapen charity. I know
30:43
we don't have a schema for that. you have lived
30:46
in the shadow of the social welfare state for
30:48
far too long. But that's sort of how it goes.
30:53
And also, remember the idea that the creation
30:57
of a national economy, doing it better, doing
30:59
it faster, doing it more efficiently, doing it
31:01
cheaper, that was the idea of progress. Not this
31:04
modern political correctness that they call inclusion.
31:07
They call that progress. Okay. So, here's the
31:11
thing. How do you help your industries along?
31:13
You help your industries along by giving them
31:15
revenues, by giving them land grants, by giving
31:17
them a money system that's flexible. By the way,
31:19
are greenbacks flexible? Yes, they are. Because
31:22
if you don't have enough, what do you do? If
31:25
you don't have enough bills, what can the government
31:31
do? Print more. Whereas gold and silver, can
31:36
you print more? No. And so you have the Legal
31:39
Tender Act of 1862. This actually puts forward
31:41
the greenbacks and actually encourages banks
31:43
to adopt a federal monetary standard, whereas
31:46
previously individual banks printed notes. Now
31:49
also, Homestead Act of 1862 allowed a person
31:53
to get 160 acres for free from the government
31:56
of the United States. Morrill Land Grant Act.
32:00
This is the one that actually provided for the
32:02
funding of land grant colleges devoted to the
32:08
spreading of useful science in agriculture and
32:13
mechanics. This is why we have A &M systems in
32:16
Texas and Oklahoma and other colleges in the
32:19
West. You get the idea. Now, here's the part
32:27
that gets kind of interesting. So, who would
32:35
have opposed paper currency? Southern Democrats.
32:39
Who would have opposed tariffs? Southern Democrats.
32:44
Who might have opposed... Now, here's the thing.
32:48
They might not have opposed the land grant because,
32:50
again, land grant would be an extension of the
32:54
cult of the yeoman farmer, yes? But certainly,
32:57
why are these acts able to pass? 1862, 1863,
33:03
what else is going on? Where are the Southern
33:04
Democrats? Not in Congress, not even in the Union.
33:08
1862, 1863, they're in an enemy territory, aren't
33:12
they? You get the idea. And so what are the Republicans
33:16
able to do? They're able to nationalize the economy
33:19
in ways that they wouldn't have been able to
33:22
had the South stayed. Okay, laissez -faire. We
33:26
kind of talked about this earlier. That one of
33:29
the doctrines of this new nationalist Republican
33:35
Party is that yes, people should be free to work.
33:38
Work is the glorification of the divine. And
33:41
that wealth can be made so that wealth can be
33:44
given away. But the other idea is that they believed
33:48
that... Apart from fostering economic development
33:52
through land grants, that the government should
33:54
not interfere with private property. It's at
33:57
this point that you have this idea of the invisible
33:59
hand of the market being a regulator. So this
34:02
is what we call laissez -faire economics. Laissez
34:05
-faire, of course, is French, but my French pronunciation
34:06
of it is terrible. However, what could possibly
34:11
go wrong with the government not intervening
34:15
in commerce at all? You have the rise of monopolies.
34:21
Also, and this is what you kind of get into.
34:28
You have the rise of monopolies. You also have
34:37
unsafe practices, whether it be labor or whether
34:43
it be... Selling of unsafe, we'll just say unsafe
34:48
practices and products. Now, this may trigger
34:55
some of you. I'm just going to warn you all.
34:59
How many of you remember the great blue bell
35:02
famine of, was it 2016 or 2015? The great blue
35:06
bell famine of 2015. What happened? They had
35:14
a listeria outbreak. They had to recall the product
35:18
and they've been under... Who's investigating?
35:20
Who had to investigate because of the listeria
35:23
outbreak? The federal government, yes? Because
35:27
Blue Bell ice cream is traded across state lines.
35:32
Right? Why do they have the authority to do that?
35:37
Because the government gave them that authority
35:40
in the interest of keeping interstate commerce
35:42
safe. But first they had to create a pure food
35:48
and drug administration to say, hey, we get to
35:51
inspect your ice cream. What would have happened
35:53
if there was no regulatory oversight? What could
35:55
have possibly happened? More Listeria -invested
36:00
ice cream going out the market, yes? Okay? And
36:05
so, that's where we run into a bit of a pinch.
36:08
Now, the other idea, and the rise of monopoly
36:12
is something to think about. Okay. What is the
36:17
danger of a monopoly? Y 'all do have some monopolies
36:20
in your life. We don't consider them dangerous.
36:24
You only have one power company powering your
36:27
home. Right? What could possibly go wrong with
36:32
a monopoly? If there is only one seller, what
36:38
can they do to the price? Raise it. And doesn't
36:43
that, in a way, make the company more powerful
36:49
than the government? Yes? Now, what's the difference
36:54
between a company and a government? In our government?
37:01
Well, More to the point, do we choose our own
37:08
companies? No, we do choose our leaders, don't
37:11
we? And so you had with the rise of these monopolies
37:16
the rising of companies that were wealthier and
37:19
in many ways more powerful than the government
37:21
of these United States. And that gave them a
37:25
capacity to exploit the market to serve their
37:28
own ends. And so what is going to be a driving
37:31
feature into the 20th century is the ability
37:35
of the government to protect the market by breaking
37:38
up monopolies or trusts. But is that a breach
37:43
of laissez -faire economics? Absolutely. Alright,
37:48
so these are some people out on the homesteads
37:50
in the Great Plains. Okay. How much time we got?
37:56
Three minutes? Okay, a couple of things happen.
38:07
A couple of things happen. With these new industries,
38:15
you have an economic change in the United States.
38:21
You have the rise of towns and cities where there
38:24
were no towns and cities. Also, you have the
38:27
rise of... professions that had not hitherto
38:30
been done. And so you have the rise of an American
38:34
middle class. Now, one of the things that you
38:37
run into with the rise of an American middle
38:39
class is you have sort of what does it mean to
38:43
be middle class? Think about this for a moment.
38:49
More of the population prior to the networking
38:54
through the railroad prior to the beginning of
38:57
the 20th century, more people had made their
39:00
living with their hands. Whether it was a factory
39:02
worker, whether it was a yeoman farmer, whether
39:04
it was what have you. To this day, does an engineer
39:07
really make their money with their hands? What
39:10
about an accountant? And you see, you have the
39:14
rise of these specializations. Now what made
39:16
the specialization possible? Well, we have the
39:18
corporate farming, don't we? So, you have the
39:23
rise of an American middle class, and how do
39:27
you know you're in the middle class? What does
39:28
it mean to be middle class? Well, you work with
39:30
your brain and not your hands. In order to work
39:33
with your brain, what do you need to have to
39:35
work with your brain? An education. So you have
39:38
the expansion of colleges, and also you have
39:41
colleges that start admitting women. Now, here's
39:45
the funny one. At this point, are women entering
39:49
the workforce permanently in large droves? No.
39:52
No. Then why are they becoming educated? Teachers.
39:57
Well, but even teaching was considered a temporary
40:00
profession for a woman until she found what?
40:02
A husband. Same with nurses. Same with a whole
40:05
host of things.