ROBBER BARONS OR CAPTAINS OF INDUSTRY? Capital, Social Darwinism & Laissez-Faire

John Rockefeller SShrewd businessman 11872 – South Improvement Company CCouples with railroads FForces small oil refineries out of business 11882 – organizes trust to monopolize industry 11892 – Ohio Supreme court tries to take on Standard Oil EEstablishes Rockefeller Foundation with $500 million & funds research to find a cure for yellow fever

Despite the passage of the Sherman Antitrust Law in 1890, enforcement against powerful industry was difficult. It wasn’t until 1914 with the Clayton Antitrust Act and the Federal Trade Commission that government began to get the upper hand against powerful capital “What a funny little government!”

Andrew Carnegie BBorn in Scotland, Carnegie’s family immigrates to US in 1848 BBessemer process – steel would replace iron IInvested in steel – took on Henry Frick as partner FFrick consolidated holdings into Carnegie Steel Company CCarnegie breaks steel unions in Homestead Strike in 1892 GGenerous philanthropist CCarnegie very contradictory

Social Darwinism & Capital  British philosopher, Herbert Spencer adds social component to Darwin’s On The Origin of Species  Spencer championed the idea of “survival of the fittest” in society  “The millionaires…They may fairly be regarded as the naturally selected agents of society.”  Social Darwinists were staunchly against any government interference in social or business matters & became a way for capital to justify unpopular actions Herbert Spencer

Carnegie & Social Darwinism  Spencer's writings provided the philosophical justification for Carnegie’s pursuit of success in the world of business  Carnegie struggled with egalitarian beliefs he inherited from his Scottish background  In his "Autobiography," Carnegie wrote about the dramatic effect of reading Spencer’s ideas on Social Darwinism: "I remember that light came as in a flood and all was clear. Not only had I got rid of theology and the supernatural, but I had found the truth of evolution. 'All is well since all grows better' became my motto, my true source of comfort."

This political cartoon from 1892, shows Andrew Carnegie as a “giver” and a “taker.” Some viewed him as a Robber Baron (when he was reducing wages or breaking a strike) while others viewed him as a Captain of Industry because of his generous philanthropy. Carnegie adopted Spencer’s view because of his ongoing struggle.

Social Darwinism & Laissez-Faire  Social Darwinism propels belief in Laissez-Faire economics  Laissez-Faire definition: An economic policy that allows businesses to operate with very little interference from the government – interference from the government equals regulation  Belief that Social Darwinism led to the capable at the top:  John Rockefeller  Andrew Carnegie

What is Profit? Which statement do you agree with most?  Profit comes from the work of the laborers and should be shared by the laborers.  Profit comes from the intellectual ideas of entrepreneurs, who should be rewarded for their innovation and risk taking. Summary of Karl MarxSummary of Ayn Rand How you answer this question has great importance in regard to how you will view the struggle between capital and labor and the beliefs that evolve during this timeframe in America’s history

Capital & Labor Issues OOur next tentacle deals with labor issues & labor unions YYou will read about the Homestead Strike & you will get information from your book on labor so BRING BOOK NEXT CLASS!!! WWe will use this to discuss labor issues & labor unions State militia arriving to quell striking steelworkers at Carnegie’s Homestead