The Rise of Big Business Expansion of Industry The Rise of Big Business

Changes in daily life Entrepreneurs introduce new technologies and begin to make life easier and products cheaper for many Americans Light bulb Railroads Bessemer Steel Telegraph Telephone

Changes in America Many more natural resources discovered in the west (westward expansion) Rise in population (larger families, immigration) = Larger workforce!!! Government’s position in business- the government tried to support American business while taxing (tariffs) on foreign business

Tarriffs

Changes in Industry Mass Production begins takes over in many industries making products cheap and labor more valuable. Machines help this too! This puts more money in more pockets and at the same time gives them new products to buy with that money

Industrial Elites Robber Barron- build fortunes by stealing from the public. Drain natural resources bribe public officials to make legal decisions more favorable to their causes. Captains of Industry- Find new ways of doing things, take advantage of new technology, increase the economy and provide lower priced goods

Robber Barons/Captains of Industry Carnegie- Steel Rockefeller- Oil Vanderbilt- Railroads Amass huge fortunes practice vertical and horizontal integration, eliminating the competition. Give huge sums to philanthropic causes

Monopoly- when one company has complete control of and industry, buy competition or drive them out Cartel- when several companies act in association to control and industry Trusts- when companies turn over their assets to a larger company in return for shares, a way to get around monopoly laws Corporations-owned by many people but treated as 1 person Holding Companies- Doesn’t make anything, owns stock in companies that do

Interstate Commerce Clause Part of the Constitution that gives Congress the power to regulate interstate commerce In the 1900s it is used to give congress the power to take on these new industrial giants and curb their control of the economy.

Sherman Antitrust Act Made it illegal to form a trust that interfered with free trade between states or with another country. (Remember that is a job of congress)

Consolidation- to bring many business together under 1 company Horizontal consolidation Bringing together many firms involved in one business Vertical Consolidation Gaining control of the many businesses that make up all phases of production

Horizontal consolidation

Railroads change American Spur Growth (investment and movement west) Links the nation (Union Pacific) Get consolidated by a few big companies Standardize the rails Standardize the time (4 zones)

Darwin and Economics Darwin's survival of the fittest is growing in popularity Many apply this idea to human society Many apply this idea to business lais sez-faire- when the government stays out of business leaving buyers and seller to regulated it themselves

Part II Unions

Unions Trade unions- limited to people with specific skills, begin to get more popular with the spread of industry Industrial unions- all craft workers and common laborers in a particular industry Industries Oppose Unions, Why?

Communism Karl Marx- “father or communism” Thought the working class would rise up and take over the means of production People would own the means of production collectively A lot of union members like this idea A lot of business leaders use it against them

Benefit to Workers or Commies? Unions get identified as Marxist (many times it was actually true) Industries begin to “blacklist” trouble makers Great railroad strike of ’77 Recession = wage cuts 80,000 workers involved/violence erupts Hayes calls troops to Chicago

Knights of Labor 1st nationwide strike called for 8 hour day Equal pay for women End of child labor Wanted arbitration Haymarket riot ends their popularity

Pullman Strike Company Store (how does it resemble China) Pullman company workers were fighting against the company store model Workers strike and ARU (American Railway Union) stops handling Pullman cars Federal Court orders a halt- Pullman and ARU both collapse

AFL Founded by Samuel Gompers Beginning of the modern union Rejected Socialists and communist ideas Pushes for better wages and conditions Pushes for collective bargaining Very successful Still around today

Women Paid less (for the same work) Fired first Excluded from most unions (including AFL) Women’s Trade Union League- first union dedicated to women’s labor issues