Rise of Big Business

Causes of Industrial Growth Wealth of natural resources Coal, iron ore, timber Fertile soil Explosion of inventions improve business and manufacturing efficiency

Causes of Industrial Growth Large labor supply High birth rate Immigrants from Europe and Asia women & children Improved transportation makes buying and selling goods easier Railroads, canals, roads

New Industries Railroads First transcontinental railroad is completed By 1900, there were 5 transcontinental railroad systems

Robber Barons or Captains of Industry?

Captains of Industry “Entrepreneurs who took risks developing the new inventions and technology during the era of the Industrial Revolution. Their determination and hard work earned them money, fame and success. These were men of vision who guided and built new industries and made a significant contribution to the economy of the United States.”

Robber Barons Wealthy from big business Accused of Swindling investors Bribing government officials Cheating on contracts and debts Exploiting workers and forcing horrible working conditions and practices on laborers

Prime Example: George Mortimer Pullman (1831 – 1897) Designed the Pullman sleeping car and made a fortune Founded a company town for his workers Following the Panic of 1893, in an effort to keep his profits, Pullman increased working hours, cut wages and cut jobs

Directions: DO NOT WRITE ON THE READING!!! Fill out the chart for your person only!!

As a group: Make a poster that answers the following questions about your assigned person: Picture of Person Name of person: Industry: How they got started: Accomplishments: Evaluation: Good/Bad - Were they more of a Robber Baron or Captain of Industry? Explain.

Cornelius Vanderbilt (1794-1877) Began a RR empire by merging popular lines in NY to form the New York Central and Hudson River RR

Improvements for Trains George Westinghouse developed the new air brake system for trains in 1868 using compressed air after viewing a collision

Steel Industry Andrew Carnegie (1835-1919) Began in RR business Met Sir Henry Bessemer who invented a new process of making high quality steel—now called the Bessemer Process He decided to get into the steel business and opened a company in Pittsburgh in 1875

By the 1890s, his company was the largest and most profitable enterprise in the world

Vertical Integration- process in which he bought: coal fields & iron mines  ore freighters  railroad lines Goal = to control the raw materials and transportation systems (own all phases of production)

Carnegie

J.P. Morgan (1837-1913) 1901—Carnegie decided to sell his steel company to Morgan who then formed U.S. Steel At one time was the largest producer of steel in the world, now produces less than 10%

JP Morgan

Oil Industry Edwin Drake (1819-1880) 1859—drilled first oil in U.S. near Titusville, PA Caused major expansion of oil business By 1900 oil fields from PA to TX had been opened

John D. Rockefeller (1839-1937) Organized the Standard Oil Company By 1880s - controlled more than 90% of oil refining in the U.S. Used horizontal integration to buy out smaller refiners

Monopolies and Trusts Late 1800s—Americans become suspicious of large corporations Power of monopolies was feared Wanted to prevent horizontal integration

1882—first trust was formed by the Standard Oil Company Trust = a coalition of organizations formed to limit competition by controlling the production and distribution of a product or service Enabled trustees to control a group of companies as if they were one large merged company

Sherman Anti-Trust Act: Prohibited monopolies 1911—Government found Rockefeller’s company to be a monopoly and forced it to be divided into 34 companies including: Amoco Chevron Conoco Exxon Mobil

Important Information: If you’d like to retake your quiz from last Thursday, it must be done by this Friday!!

Ideas of the Gilded Age Objective 5.02

The Gilded Age Coined by Mark Twain Era of U.S. from approximately 1876-1900 Period of rapid industrialization Characterized by ruthless pursuit of profit and government corruption

Individualism No matter how humble a persons origins, they could rise in society and go as far as their talents and commitment would take them Horatio Alger—expressed individualism through numerous “rags-to-riches” novels involving the poor going to the big city and becoming successful

Social Darwinism Reinforced idea of individualism Proposed by Herbert Spencer, English philosopher Applied Darwin’s theory of evolution and natural selection to human society Argued that society progressed and became better because only the fittest were successful

Gospel of Wealth Those who were wealthy, such as Carnegie, attempted to extend and soften the harsh philosophy of Social Darwinism through philanthropy Believed that those who profited from society owed it something in return Used their great fortunes to further social progress

Jay Gould Worst reputation of all Practiced insider trading by using information he received as a RR owner to manipulate stock prices to his benefit Other accused robber barons include Morgan, Rockefeller, etc.

Robber Barons Wealthy from big business Accused of Swindling investors Bribing government officials Cheating on contracts and debts Exploiting workers and forcing horrible working conditions and practices on laborers

How do many American families live and work during the Gilded Age? What problems did you notice while examining the sources? What changes need to be made and how can people work to achieve them?