The Second Industrial Revolution
The moments of extreme crisis and survival were not the evidence of chaos but order. This idea was promoted by Russian economist, Nikolai Kondratiev, who determined that instead of collapsing under crisis, Capitalism generally adapts and mutates. He was the first person to show the existence of long cycles in economic history.[1] He proposed the theory that Western capitalist economies have long cycles (50 to 60 years) of boom followed by depression.
The start of a long cycle sees:
- the rollout of new technologies
- the rise of new business models
- new countries dragged into the global market
- rise in the quantity of money
The Long Depression witnessed on the mutation of Capitalism and beginning of a new long cycle: The Second Industrial Revolution.
The Second Industrial Revolution is defined by innovations in electrical energy which powered the machines that gave rise to a new mode of manufacturing known as ‘mass-production.’
America entered the Second Industrial Revolution in the aftermath of the Civil War which ended in 1865. The economy grew considerably due to the abundance of natural resources it acquired from newly seized territories and the large supply of labour immigrating from Europe.
The federal government promoted industrial development by fending off foreign competition with high tariffs, deploying the army to remove Indians from western land desired by farming and mining companies, and most importantly granting land to railroad companies to encourage expansion. Railroads linked distant, previously isolated communities together and the dramatic expansion of the rail network lead to a substantial reduction in the time and money it took to move heavy goods, thus creating new opportunities for wealth.
Telephone lines were built along side the railroads and ushered in an era of instant communication. Without these communications technologies it would be impossible to organize complex market transactions and keep track of commercial activity across the supply chain.* Gigantic operations became the norm during the Second Industrial Revolution.[2]
To maintain the new centralized corporate bureaucracies, a new rationalized workforce was required. The efficiency principles developed by engineers would soon be applied to workers, essentially turning them into living machines. The leader behind this efficiency movement was Frederick Winslow Taylor.
Taylor believed that that the best way to optimize worker efficiency was to separate thought from action and that management should have complete control over how a task was to be executed.[3] In his book ‘The Principles of Scientific Management’, he describes how labour productivity can be radically increased by breaking down each labour process into component motions and organizing fragmented work tasks according to rigorous standards of time and motion study.
Working as the management consultant at factories, Taylor slowly standardized every aspect of production — the quality of machines and tools, speed and depth of cuts, rate of feed, and sequence of operations. Step by step, he isolated the critical performance variables and drove to a best-practice standard. Taylor introduced the piece rate, where each worker was paid for each unit of production at a fixed rate, and the workers performance was tracked by time cards. He became obsessed with the idea that all human actions could be engineered like a machine.
Entrepreneurs arrived in cities such as New York, Chicago, and Detroit for access to harbors, manufacturers, and urban consumers. Industries clustered in cities to be near each other and their customers, thus reducing transport costs. This is known as agglomeration economies.[4]
One of the most influential entrepreneurs of the Second Industrial Revolution was Henry Ford, who founded the Ford Motor Company in Detroit. Ford based his ideas of mass-production on the time and motion studies of Frederick Winslow Taylor and the processes of the meatpacking industry. By 1914, Ford’s methods reduced the time need to assemble a car from twelve and a half fours to ninety-three minutes.[5]
Henry Ford defined mass-production as “the modern method by which great quantities of a single commodity are manufactured.”[6] This mode of manufacturing was built on two key elements: interchangeable parts and continuous flow.
Interchangeable parts are components that are nearly identical and can freely replace another, without any custom fitting. Skilled workers were still needed to build specialized machinery, tooling, and matrices to make the parts, but less skilled workers can easily assemble them. Custom mechanical matrices, such as moulds, casts, and stamps, were expensive to produce, therefore, it made sense to keep using them and spread the costs over as many copies as possible. This is known as economies of scale, where the cost per unit declines as output increases.[7]
Continuous flow operation consisted of an intense division of labour where stationary workers performed one or two tasks each on a moving object. This was revolutionary and the very opposite of traditional methods, where a stationary object was assembled by workers moving around it.
Taylor’s machine shop work focused on increasing the production of skilled machinists making variable goods with general-purpose machines. By contrast, Ford concentrated on making interchangeable parts with single-purpose machines operated by unskilled labour. Instead of devising standardized instructions for machinists, as Taylor did, Ford eliminated machinists in favor of machine tenders.[8]
Ultimately, what separates Fordism from Taylorism is Ford’s recognition that mass-production meant mass-consumption. In 1914, Henry Ford introduced his five-dollar, eight-hour work day. The reasons for this was, firstly, to ensure worker compliance with the discipline required to work the highly productive assembly line system. The second reason was to essentially provide workers with sufficient income and leisure time to consume the mass-produced products the corporations were about to turn out in ever vaster quantities.[9]
Henry Ford became famous for his manufacturing methods rather than the car itself. To manufacture the cars, Ford Motor Company had to build some of the largest factories ever seen. The first factory was opened in 1903 on Mack Avenue in Detroit: it was a small one-story, timber frame building. At this stage, Detroit was a hotbed for small innovators*, all focused on the automobile. It was referred to as Motor City and practically defined the one-industry town.[10]
Ford anticipated the company’s rapid growth and hired Alfred Kahn** to design new factories, the most notable ones being Highland Park plant and River Rouge complex.
The machine shop at Highland Park was a six-story building made of a new reinforced concrete construction method. The strength of the columns meant that heavy machinery could be placed on upper floors and materials were lifted with the aid of overhead cranes. Production could flow downwards, as parts were lowered from floor to floor, and across gravity slides and conveyor belts, until reaching the final assembly line on the ground.[11]
At the River Rouge complex, very-large single-story factories were erected instead of the multi-story solution of Highland Park. This meant that the cost of hoisting materials was avoided, and longer uninterrupted spaces could be achieved since columns were no longer needed to support the upper floors. It was the largest and most complicated factory ever built and was “more like an industrial city than a factory.” River Rouge resembled a fortress with the restricted access, high fences, railroad tracks, and guarded gates. The very opposite situation can be seen at Highland Park which was situated in a busy urban neighborhood, with public sidewalks alongside the factory buildings.[12]
Philosopher and social theorist, Michel Foucault, compared the mass-production factories to prisons, rather than fortresses. Ever since the First Industrial Revolution, punishment as public spectacle was in decline. Public executions became a thing of the past. In his book, Discipline and Punish: The Birth of the Prison, Foucault suggests that the purpose of punishment had changed and that it is not as humane as it might initially appear. The objective was no longer to break the criminal’s body, instead what was targeted was the prisoner’s heart, mind, thoughts, and will.
Prisoners were assigned forced labour as prison work. The reason for this was to reform their characters. Nothing of economic value was being produced, and the convicts didn’t acquire any new skills. Foucault questioned the purpose of this exercise and concluded that its real purpose was to absorb the prisoner into the routine of production and show him/her how to become part of an industrialized society.[13]
The prisoner was, in some way, no different from any other disciplined factory worker. Both were mere cogs in the organized structures of production.
Foucault identified four main aspects to this new system of discipline:
o art of distributions: prisoners were assigned into certain types of spaces.
o control of activity: establishing rhythm, regularity, and repetition by enforcing timetables.
o organization of geneses: one’s individuality was increasingly moulded through strict procedures and activities
o composition of forces: discipline would control the collective behavior, not just the individual
The same principles applied to the lives of industrial laborers. Labour was organized collectively with workers being assigned specific tasks, which were carried out in specific spaces, at specific times of the day. Organizational structures were even incorporated into schools. Students passed through ranks of seniority by a tightly defined process of training and examination.
What mattered more was how many people there were and how they were placed, rather than their individual strengths. Consequently, architecture played a role in discipline. Buildings were designed so that what went on inside could be easily seen from the outside, thus acquiring a new function beyond practicality and aesthetics.
The large manufacturing fortresses also affected urban conditions. Ford’s River Rouge complex began the process of suburbanizing manufacturing, a model that was adopted in many highly industrialized cities throughout America and Europe. Manufacturers no longer saw any advantages of locating in the city as their desire for large scale production required factories too large for any city to accommodate. The intellectually fertile world of independent entrepreneurs had been replaced by a few big companies that had everything to lose and little to gain from radical experimentation.[14]
The clustering of industry increases the region’s value, thus attracting even more capital and labour. This leads to an increase in local costs due to the region’s higher perceived value. As a result, companies whose aim is to keep profit margins high end up moving out in search of cheaper spaces. This generates a crisis of devaluation in which regions get caught in a downward spiral of depression and decay. The increased value of clustering is effectively destroyed once the cheap production opportunities for capitalists disappear.[15]
Between 1950 and 2008, Detroit lost 58 percent of its population. Today around one third of its citizens live in poverty. Similar declines happened in other manufacturing cities such as Buffalo, Cleveland, New Orleans, Pittsburgh, and St. Louis. The manufacturing cities were in decline because they abandoned vital features of city life: competition, connection, and human capital.[16]
* Supply chains are the complete ecosystem of producers, distributors, and vendors that transform raw materials into goods and services delivered to people anywhere.
* The automotive pioneers who established Detroit as the world’s automotive capital include: Ford Motor Company, General Motors, Chrysler, Dodge, and Packard.
** Albert Kahn went on to design a wide range of industrial buildings across North and South America, Europe, Asia, and Africa. He became the leading factory architect of the twentieth century with his firm achieving extraordinary levels of productivity by applying Ford’s principles to the firm’s operations.
Second Industrial Revolution
[1] Paul Mason, PostCapitalism: A Guide to our Future, (London, Penguin Books, 2016), 32–33
[2] Jeremy Rifkin, The Third Industrial Revolution: How Lateral Power is Transforming Energy, the Economy, and the World, (New York, St. Martin’s Griffin, 2013), 110–111
[3] Frederick Taylor, The Principles of Scientific Management, (New York, Dover Publications, 1997)
[4] Edward Glaeser, Triumph of the City: How Urban Spaces Make Us Human, (London, Pan Books, 2012), 46
[5] Joshua Freeman, Behemoth: A History of the Factory and the Making of the Modern World, (New York, W.W. Norton & Company, 2018), 126
[6] Ibid., 118
[7] Mario Carpo, The Second Digital Turn: Design Beyond Intelligence, (Cambridge, MIT Press, 2017), 147
[8] Charles Morris, The Tycoons: How Andrew Carnegie, John D. Rockefeller, Jay Gould, and J.P. Morgan Invented the American Supereconomy, (New York, Henry Holt & Company, 2006), 30–32
[9] David Harvey, The Condition of Postmodernity: An Enquiry into the Origins of Cultural Change, (Oxford, Blackwell Publishers, 1992), 125–126
[10] Edward Glaeser, Triumph of the City: How Urban Spaces Make Us Human, (London, Pan Books, 2012), 42–47
[11] Joshua Freeman, Behemoth: A History of the Factory and the Making of the Modern World, (New York, W.W. Norton & Company, 2018), 135
[12] Ibid., 139–144
[13] Michel Foucault, Discipline and Punish: The Birth of the Prison, (London, Penguin Books, 1991)
[14] Edward Glaeser, Triumph of the City: How Urban Spaces Make Us Human, (London, Pan Books, 2012), 49–50
[15] David Harvey, Seventeen Contradictions and the End of Capitalism, (London, Profile Books, 2015)
[16] Ibid., 41–43
