Industrialization - Lecture notes 7 PDF

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Prof. Jonathan Levy...

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Part%II:%The%Age%of%Capital! Week%4:%Industrialization! Monday,(April(18:(Industrialization! !! Sun-based!economy!to!mineral-based,!inorganic!economy! Power!of!steam!engine!-!limitless!power! "Modern%economic%growth":!self-sustaining,!perpetual!growth! Only!industrialization!transcended!earlier!limits!on!labor! Population!growth!(adding!labor),!colonization!(adding!land)! Smithian!growth!doesn't!disappear!after!Civil!War! Federal!govmt!subsidized!growth!of!railroads! Transformation!of!time/space!with!introduction!of!railroads! Surge!in!capital!input!in!1880s! New!form!of!capital!in!which!non-capitalist!logic!is!excluded! Industrialization!is!synonymous!with!smokestacks,!factories! Physical!investment!in!industrial,!urban!environments! Am.!Industrialization!spread!outward!-!midwest!was!center! Ohio,!Pennsylvania,!Indiana,!Illinois,!Michigan,!Wisconsin! Between!Philadelphia!and!Pittsburgh,!best-burning!coal!(anthracite)! Importance!of!coal:!allowed!for!transportation! Coal!was!necessary!for!the!process!of!capital!gains! 1865:!superintendent!of!western!division!Andrew%Carnegie! Carnegie!understood!logic!of!capitalism! !Required!ceaseless!accumulation!and!reinvestment!of!capital! Money!capital!to!fixed!capital!to!make!more!money! Not!about!commerce/commercial!exchange! Not!about!squeezing!labor!from!workforce!to!create!surplus! !Circular!logic!of!ceaseless!reinvestment!of!capital!for!surplus!value! Unyielding!profit!motive,!focus!on!cutting!costs! 1872,!Pittsburgh:!Carnegie!built!his!steel!factory! Speculative!financial!ventures,!called!himself!a!parasite! Steel!is!a!capital!good,!produced!in!order!to!produce!something!else! Not!useful!in!itself,!form!of!fixed!capital! Carnegie!never!wanted!to!know!profits,!always!costs! When!Carnegie!thinks!about!commerce!(buying!low,!selling!high),!he!thinks!it!is!due!to!the! condition!of!trade,!not!skill! Internally,!w/I!production!process!itself,!reducing!costs!over!time! Edgar!Thompson!Steelworks!(1890):!counted!on!high!elasticity!of!demand! Prohibition!emerges!from!industrialization:!if!someone!is!drunk,!process!is!ruined/people! will!die! Carnegie!has!to!destroy!workers'!control!over!production! 7!days!a!week,!12!hr!shifts! Relationship!between!men,!power,!and!energy! Social!relations!to!work! Carnegie!will!treat!labor!like!an!input:!like!coal!for!machines! Maximize!output!relative!to!input,!to!increase!productivity!incessantly!

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