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In the mid-nineteenth century, the United States had tremendous natural resources that could be exploited in order to develop heavy industry. Most of the raw materials that are valuable in the manufacture of machinery, transportation facilities, and consumer goods lay ready to be worked into wealth. Iron, coal, and oil-the basic ingredients of industrial growth - were plentiful and needed only the application of technical expertise, organizational skill, and labor.

One crucial development in this movement toward industrialization was the growth of the railroads. The railway network expanded rapidly until the railroad map of the United States looked like a spider's web, with the steel filaments connecting all important sources of raw materials, their places of manufacture, and their centers of distribution. The railroads contributed to the industrial growth not only by connecting these major centers, but also by themselves consuming enormous amounts of fuel, iron, and coal.

Many factors influenced emerging modes of production. For example, machine tools, the tools used to make goods, were steadily improved in the latter part of the nineteenth century-always with an eye to speedier production and lower unit costs. The products of the factories were rapidly absorbed by the growing cities that sheltered the workers and the distributors. The increased urban population was nourished by the increased farm production that, in turn, was made more productive by the use of the new farm machinery. American agricultural production kept up with the urban demand and still had surpluses for sale to the industrial centers of Europe.

The labor that ran the factories and built the railways was recruited in part from American farm areas where people were being displaced by farm machinery, in part from Asia, and in part from Europe. Europe now began to send tides of immigrants from eastern and southern Europe-most of whom were originally poor farmers but who settled in American industrial cities. The money to finance this tremendous expansion of the American economy still came from European financiers for the most part, but the Americans were approaching the day when their expansion could be financed in their own "money market."

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