Expansion of Business Bessemer Process- Faster and cheaper (more efficient) way to make steel. More railroads and more buildings First steel skyscraper Home Insurance Building Chicago, Illinois 1885; originally 10 stories tall

What is Big Businesses? -Monopoly (Carnegie’s US Steel) Company controls all production and sales (high prices) -Trust (Rockefeller) Corporations unite to reduce competition -Merger Joining together two companies -Who doesn’t like a good game of Monopoly? Small businesses; elimination of competition

How do big businesses eliminate competition? -Horizontal integration Buy out similar competing producers to control industry -Vertical integration Earn more money by buying out your suppliers Own all phases of production from start to finish Horizontal and Vertical Integration allowed big businessmen to increase their profits even more by limiting the amount of competition available.

Rockefeller US Oil Company Kerosene – 1 st product Automobile 1900s - gasoline

Biggest Monopolies PersonCompany Andrew CarnegieUS Steel John D. RockefellerOil Cornelius VanderbiltRailroads JP Morgan Banking/Financial Capitalist George WestinghouseElectricity

Public Reactions -Laissez-faire – “hands-off”, the government doesn’t regulate business. Why? -Social Darwinism/ survival of the fittest based on Darwin’s theory of evolution the best businesses survive justified their wealth -Gospel of Wealth (Carnegie) Donate money to society Carnegie-Melon University & Vanderbilt University And while the law of competition may be sometimes hard for the individual, it is best for the race, because it ensures the survival of the fittest in every department. ~Andrew Carnegie

Some big businessmen, like Andrew Carnegie, believed in the “Gospel of Wealth,” in which they donated their money back to society. Carnegie was the most generous of these, donating 90% of his profits back to society by building centers for the arts across the country, like Carnegie Hall, pictured above in NYC. “There is no class so pitiably wretched as that which possesses money and nothing else.” “Surplus wealth is a sacred trust which its possessor is bound to administer in his lifetime for the good of the community.” ~ Andrew Carnegie

It depends who you are… Captains of Industry – called this by people who like them because they created jobs, helped the economy, and used the Gospel of Wealth. Robber Barons- called this by people who disliked them. Said monopolists made their money by stealing from the public because they eliminated competition. Many Americans began to distrust the big businessmen and the trusts they set up, claiming that they limited competition and held control over government officials and Congressmen. How is this represented in the cartoon presented above? 14 th Amendment – Corporations = people = could not be deprived of its property without due process

Captains of Industry or Robber Barons? “The man who dies leaving behind him millions of available wealth, which was his to administer during life, will pass away “unwept, unhonored, and unsung’…of such as these the public verdict will then be: ‘the man who dies thus rich dies disgraced.” Andrew Carnegie “Charity is injurious unless it helps the recipient to become independent of it.” John D. Rockefeller “Next to doing the right thing, the most important thing is to let people know you are doing the right thing.” John D. Rockefeller “There is no class so pitiably wretched as that which possesses money and nothing else.” Andrew Carnegie

“Competition is a sin.” ~John D. Rockefeller “What a funny little government!”

Sherman Anti-Trust Act Forbade combinations in restraint of trade

South Duke – tobacco Hard – discriminations by the RRs Cotton textiles Bring the mills to the cotton Mill towns

Impact of Industrial Revolution Standard of living rose sharply Cities boomed Immigration Hello girls – typewriter and telephone 10% of people owned 90% of wealth Late 1800s – 2/3 worked for wages