Wassup B Spa? What are pros and cons of “Walmart”?

Industrialization in America: The Rise of Big Business What are the pros and cons of industrialization in America during the Gilded Age?

What is “capitalism”?

CAPITALISM!!!!!! CAPITALISM- economic system where means of production are PRIVATELY owned What is the opposite?

INDUSTRIALIZATION IN AMERICA; THE “FACTORS OF PRODUCTION”: LAND (NATURAL RESOURCES)- oil, coal, iron ore (steel) LABOR- immigration, urbanization- cheap labor source ENTREPENEURSHIP- people with the vision, talent, and willingness to take risk (HW) Carnegie, Rockefeller, Morgan, Vanderbilt, etc….. “CAPITAL”- (money, building, tools, machinery, etc.) corporation- new type of business to raise more capital Stocks- a share in the business investors can purchase

Andrew Carnegie John D. Rockefeller J.P. Morgan Cornelius Vanderbilt HOMEWORK: ON-LINE, PLEASE LOOK UP ONE OF THE FOLLOWING ENTREPENEURS AND ANSWER THE QUESTIONS: Andrew Carnegie John D. Rockefeller J.P. Morgan Cornelius Vanderbilt How did this man acquire his wealth? (How did he beat competition in his industry)? How did he (or his company) treat his workers? How did he donate his money? Fun Facts? Is he a “Robber Baron” (evil) or a “Captain of Industry”?

NATURAL RESOURCES FUEL INDUSTRIALIZATION: OIL- “Black Gold” 1859- steam powered drill can access oil underground Refined for kerosene to light lamps (used to use whale oil) Eventually gasoline is most valuable product (automobiles) 2. STEEL BESSEMER PROCESS- new way to refine iron into steel (1850s) RR’s, barbed wire, farm machinery 1883- Brooklyn Bridge- called a “wonder of the world” Birth of the SKYSCRAPER- cities can now grow “upwards”

AN ERA OF INVENTIONS: THOMAS EDISON- creates world’s first research lab in Menlo Park, NJ 1093 “patents” 1880- light bulb Electricity- in homes by 1890s- electric light, refrigeration… Factories no longer need to be by water Factories no longer dependent on daylight Other significant inventions: Typewriter- 1867 Telegraph- 1837; Telephone- 1876 Creates new jobs for women- clerical office work 1903- airplane

IMPORTANCE OF RAILROAD: First “big business” RR- huge customer for steel, coal, iron, lumber, glass (catalyzes other big businesses) Creates a national market Companies can market products to entire nation

Why is COMPETITION essential in a capitalistic society? Why do producers NOT like competition?

THE RISE OF “BIG BUSINESS” IN AMERICA: KEY TERMS: SOCIAL DARWINISM- theory of “survival of the fittest” is applied to human society. Economically, it leads to the policy of laissez- faire __LAISSEZ- FAIRE French for “leave it alone”, essentially. THE GOVERNMENT SHOULD NOT REGULATE BUSINESSES OR THE MARKETPLACE BUSINESS CONSOLIDATION: Mergers of business into one larger business   VERTICAL INTEGRATION when a company controls suppliers, distributors, transportation etc. HORIZONTAL INTEGRATION- when a companies that make similar products merge MONOPOLY- when one company dominates an industry TRUSTS- like a monopoly; competing companies run by “one board of trustees”

GOVERNMENT AND BIG BUSINESS DURING THE GUILDED AGE According to laissez- faire, the government is “supposed” to stay out of business. In reality, governmental policies favor big business during the Gilded Age: Railroads are SUBSIDIZED (Pacific Railway Act) Tariffs are high Quite a bit of bribery, corruption Immigration laws are very easy Military used to break strikes 1st effort to control trusts: SHERMAN ANTI-TRUST ACT (1890) Ineffective- wording very lose; Supreme Court throws out 7/8 cases, consolidation continues

Andrew Carnegie John D. Rockefeller J.P. Morgan Cornelius Vanderbilt HOMEWORK: ON-LINE, PLEASE LOOK UP ONE OF THE FOLLOWING ENTREPENEURS AND ANSWER THE QUESTIONS: Andrew Carnegie John D. Rockefeller J.P. Morgan Cornelius Vanderbilt How did this man acquire his wealth? (How did he beat competition in his industry)? How did he (or his company) treat his workers? How did he donate his money? Fun Facts? Is he a “Robber Baron” (evil) or a “Captain of Industry”?