Economic Growth USH-4.2 & 4.3

I. Factors Economic boom during and after Civil War Major factors: Land and natural resources Labor – workers Capital – money Technology Entrepreneurship – starting businesses

II. Beginnings US government provided environment that helped businesses Protective tariff to help northern business National bank provided capital and regulated lending Westward expansion opened new markets and raw materials Gov’t removing NAs helped

II. Beginnings Supreme Court helped Steam engine Dartmouth v Woodward held up contracts and protected patent laws Gibbons v Ogden regulated interstate commerce Steam engine Steamboat Railroad Oil drilling

III. Growth Congress helped railroads and regulated banking War contracts stimulated many businesses Gov’t provided protection for western settlers Raised tariffs Higher wages but higher prices Promoted open immigration to have lots of workers when needed Chinese Exclusion Act was passed after the railroad was completed and they no longer needed them

III. Growth Gov’t helps break up and end strikes Helps Big Business Hurts poor workers Surplus of goods become exports Gov’t wants to expand (imperialism)

IV. Capitalism Economic system that has private ownership of property and it is used to make a profit For individuals or corporations Supports democratic ideas of freedom and opportunity Hard work = more money No work = no money Corporations grow during Civil War and have greater influence

V. Railroads Leads to the growth of other industry Lumber – RR ties Steel – rails & engines Coal – for steam and transporting it Meat packing – special cars for transporting it Grow so big that when some RRs go bankrupt, the whole country goes into a depression

VI. Vertical Integration Form of a monopoly where every aspect of production is controlled Andrew Carnegie – owner of US Steel Owned coal mines Owned iron ore mines Owned steel mills Controlled steel distribution Able to drive prices down to kill competition

VII. Horizontal Integration To entirely control one facet of production to create a monopoly John D Rockefeller – owner of Standard Oil Controlled almost all oil refineries in US Undersold competition Forced retail outlets to NOT sell competitors Forced RR to give him sweet deals

VIII. Robber Barons? Were business leaders: Ripping off the public for their personal wealth Captains of Industry Using capitalism to make the US wealthy Monopolies lead to the Sherman Anti-Trust Act Limits on Big Business and breaks up monopolies

VIII. Robber Barons? CEO’s used cut-throat practices justified by: Social Darwinism Survival of the fittest for people and businesses Laissez-faire “Let it be” Gov’t doesn’t touch the economy They still wanted gov’t protection against labor

VIII. Robber Barons? Many became philanthropists Gave away millions for: Schools Hospitals Libraries Theaters Orphanages Charities “Buying their way into Heaven”

IX. Standard of Living Life got better for most people Monopolies create lots of new products Electricity Typewriter and telephone New jobs for women Mass production lowers prices Henry Ford’s moving assembly line in 1913 Some farmers & factory workers still have nothing