EQ: Should government regulate private industry? The Gilded Age EQ: Should government regulate private industry? After the Civil War, the U.S. was still largely an agricultural nation. By the 1920s (60 years later), it had become the leading industrial power in the world.

Causes of the Growth of Big Business Percent of Americans living in Urban and Rural Areas Year Urban Rural 1840 11% 89% 1860 20% 80% 1880 28% 72% 1900 40% 60% 1920 51% 49% Wealth of natural resources Government support for business Growing population provided:immigrant urban Cheap labor New markets for products

Oil “Black Gold” Native Americans had made use of crude oil long before Europeans arrived 1840s- Americans used kerosene for lamps 1859- Edwin L. Drake used a steam engine to drill for oil in PA Led to oil boom Petroleum-refining industries sprang up to make kerosene Gasoline (byproduct) was originally thrown away

Bessemer Steel Process Iron plentiful in US Remove carbon from iron get steel Lighter, more flexible, rust-resistant 1850- Bessemer process created in Britain Allowed steel to be manufactured cheaply & efficiently

Railroads and Steel Railroads were the biggest customers of steel 35,000 miles of track in 1865 193,000 miles of track by 1900 Connected vast regions of the United States and allowed for transport of goods Created a national market

Other New Uses for Steel Steel farm machines McCormick, John Deere Allowed the Midwestern plains to become food producer for nation Brooklyn Bridge Steel cables allowed for longer, stronger bridges Skyscrapers Steel frames bore the weight, allowing for taller buildings

Andrew Carnegie Visited Britain & witnessed the Bessemer Process in action Brought this process back to the U.S. (Pittsburgh) and created the Carnegie Steel Company By 1900 it was manufacturing more steel than all factories in Britain First billion dollar company

John D. Rockefeller World’s first billionaire Created the Standard Oil Company

Standard Oil Sold oil at lower price than competitors When they went bankrupt and Standard Oil purchased the company

Both of these were used by Carnegie and Rockefeller to gain a monopoly Vertical Integration When a company buys out suppliers to control raw materials & transportation systems Horizontal Integration When a company buys out competitors in the same industry Both of these were used by Carnegie and Rockefeller to gain a monopoly

How can this be bad for workers? How can this be bad for consumers? Monopoly When one company has complete control of an entire industry This includes production, wages, and prices of goods How can this be bad for workers? How can this be bad for consumers?

Negative term used to describe big business leaders who were Robber Barons Negative term used to describe big business leaders who were Greedy Ruthless used unethical practices didn’t care about their workers, customers, or competitors

Sherman Anti-Trust Act Government’s attempt to stop monopolies It was hard to prove a monopoly in legal terms Many businesses planned ahead for accusations and would break up if accused