The Age of Big Business: A Chronicle of the Captains of IndustryHendrick, Burton Jesse
History
The Age of Big Business: A Chronicle of the Captains of Industry
Hendrick, Burton Jesse
Big business -- United States -- History; Industries -- United States -- History
At first glance, the Pittsburgh region seems hardly the ideal place for
the making of steel. Fortune first placed the industry there because
all the raw materials, especially iron ore and coal, seemed to exist
in abundance. But the discovery of the Minnesota ore field, which alone
could supply this essential product in the amounts which the furnaces
demanded, immediately deprived the Pittsburgh region of its chief
advantage. As a result of this sudden development, the manufacturers of
Pittsburgh awoke one morning and discovered that their ore was located a
thousand miles away. To bring it to their converters necessitated a long
voyage by water and rail, with several reloadings. They overcame these
obstacles by developing machinery for handling ore and by acquiring the
raw materials and the connecting links of transportation. Ore which had
been lying in the wilds of Minnesota on Monday morning was thus brought
to Pittsburgh and made into steel rails or bridges or structural shapes
by Saturday night. The Carnegie Company first acquired sufficient
mineral lands to furnish ore for several generations and organized an
ore fleet which transported the products of the mines through the lakes
to ports on Lake Erie, particularly Ashtabula and Conneaut. The purchase
of the Bessemer and Lake Erie Railroad, which extended from Conneaut
to Pittsburgh, made this great transportation route complete. Besides
freeing their business from uncertainty, this elimination of middlemen
naturally produced great economies.
Probably Andrew Carnegie's shrewdness in naming his first plant the
J. Edgar Thompson Steel Works, after the powerful President of the
Pennsylvania Railroad, and in making Thompson and his associate Scott
partners, had much to do with his early success. These two gentlemen
conferred two priceless favors upon the struggling enterprise. They
became large purchasers of steel rails and their influence in this
direction extended far beyond the Pennsylvania Railroad. What was
perhaps even more important, they gave the Carnegie concerns railroad
rebates. The use of rebates, as a method of stifling competition and
building up a great industrial prosperity, is an offense which the
popular mind associates almost exclusively with the Standard Oil
Company, yet the Carnegie fortune, as well as that of John D.
Rockefeller, received an artificial stimulation of this kind.
Public-domain text, read in full here on John Shaqi.
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