HISTORY 124A Lecture Notes - Lecture 27: New York Central Railroad, Midvale Steel, Welfare Capitalism

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28 Oct 2016
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Department
Lecture 27: Welfare Capitalism 10/28/2016 1:09:00 PM
Announcements and Recap
Midquiz unmuted today. Exam booklets returned next week.
Essay 2 Prompt posted
o Due Friday, 11/18/2016
Background to Welfare Capitalism
A strategy used in the 1920s by big business to give ropers some
fringe benefits to that they won’t strike and they’ll be happier on
the job; they’ll produce more.
o Recreational activities
o Paid vacations
If we provide more benefits, it might be cheaper than continuously
breaking up strikes. Therefore, improve labor strike itself and
undermine unions. The middle class might start looking favorably
upon big businesses.
Frederick W. Taylor
1878Taylor takes a job at the Midvale Steel Works and soon
becomes a gang boss, then manager.
1880Taylor wins a bitter fight with workers over production
speed.
1898Taylor increases worker output at Bethlehem Steel
Company.
Taylor characterized Schmidt (Henry Noll) as “the mentally sluggish
type”
Schmidt was told he would make $1.85 a day, rather than $1.15, if
he did whatever the scientific manager told him to: “When he tells
you to pick up a pig and walk, you pick up a pig and walk…when he
tells you to sit down, you sit down, and you don’t talk back.”
1898Taylor increases worker output at Bethlehem Steel
Corporation from 12.5 tons per day to 47.5 tons per day, a 380%
productivity increase for a wage increase of 80%
1903Taylor publishes Shop Management
1906Taylor elected president to the American Society of
Mechanical Engineers.
1911Taylor publishes Principals of Scientific Management
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Taylor viewed scientific management of corporations “what other
reforms could do as much toward promoting prosperity, toward the
diminution of poverty, and the alleviation of suffering?”
Taylor viewed scientific management of corporations as the solution
to the labor problem.
Taylor also wanted to apply his methods to farms, governments,
and universities
Engineering Utopia
Henry Ford
1903Ford founds Ford Motor Company
1908Ford and a group of mechanics develop the Model T
1913 April 1Ford implements the assembly line on some parts of
his plant. Labor turnover skyrockets to 380% per year.
1914 January 5Ford announces $5/day policy
1914 January 23The wife of an assembly line worker writes Ford:
“The chain system you have is a slave driver! My God!, Mr. Ford.
My husband has come home & thrown himself down & won’t eat his
supper-so done out! Can’t it be remedied?...That $5 a day is a
blessing—a bigger one than you know but oh they earn it.”
Cost by Model T’s Per year
o 1908$850
o 1920$440
o 1925$290
10 millionth model T sold
Office Taylorism
1890—Hollerith’s tabulating machine makes its first big
demonstration when used for the US Census
1902An Interstate Commerce Commissioner tells the New York
Central Railroad comptroller in the famous Eastern Rate case that
he should use Hollerith’s tabulator to process cost data.
1911—Hollerith’s company companies with two others and is later
renamed IBM
1917William Henry Leffingwell writes Scientific Office
Management: A Report on the Results of Applications of the Taylor
System of Scientific Management to Offices with a Discussion of
How to Obtain the Most Important of these Results.
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