Warm-Up 4/10 If you could be the owner of any type of company, what would it be? Why?

Lesson Question Why might the rise of industry be good or bad for the United States?

Vocabulary Division of Labor Mass Production Vertical Integration/Consolidation Horizontal Integration/Consolidation Philanthropy Business Cycle

Review

Business Leaders Andrew Carnegie Steel John D. Rockefeller Oil Cornelius Vanderbilt Railroads J.P. Morgan Banking Philip Armour Meatpacking

John D. Rockefeller and the Standard Oil Company Wealthy individual who saw the oil industry as a way to get richer Made illegal deals with railroads to transport oil cheaper, thus weakening other refineries that he would eventually buy Utilized horizontal integration or consolidation for business purposes

Horizontal Integration/Consolidation When all of your competitors have been bought out Think MONOPOLY Standard Oil Company/John D. Rockefeller

Controlling the Market Bob’s Pizza Delaware Pizza Happy Time Pizza Using Horizontal Integration, Bob could control the Pizza market in town by buying the other Pizza shops! Bob’s Pizza

Andrew Carnegie Scottish Immigrant Captain of Industry for steel production in Pittsburgh Used Bessemer Process to produce stronger steel Utilized vertical integration or consolidation

Vertical Integration/Consolidation Controlling businesses related to various phases of production for a product Own all elements of a business Carnegie Steel/Andrew Carnegie

Controlling the Market Bob’s Pizza Using Vertical Integration, Bob could control the Pizza market in town by controlling many of the costs associated with making his pizza! Bob’s Farm Bob’s Cheese Factory Bob’s Trucking Company

Robber Barons Business leader who made a fortune by stealing from the public. Drained natural resources, paid low wages to workers, required long hours of employees

They persuaded public officials to interpret laws in their favor. They ruthlessly drove their competitors to ruin. Paid their workers meager wages and forced them to toil under dangerous and unhealthful conditions.

Captains of Industry The business leaders who served their nation in a positive way. Increased the supply of goods by building factories. Raised productivity and expanded markets.

Created jobs that enabled many Americans to buy new goods and raise their standard of living. Also created museums, libraries, and universities, many of which still serve the public today. Carnegie Hall

Carnegie as a Philanthropist A Philanthropist uses wealth to improve society Carnegie funded the building of libraries, education facilities, and music/arts facilities

“Gospel of Wealth” “Gospel of Wealth” Carnegie’s philosophy - A person should be able to make as much money as they can, BUT they should also use their wealth to improve society.

Sherman Antitrust Act Enacted in 1890 Effort by Congress to end trusts Ineffective due to lack of enforcement More about it in future units

Monopoly vs. Cartel Monopoly – one company with complete control of a product or a service Cartel – a loose association of businesses in a similar field or that make the same product and agree to limit supply to drive up prices

Music Time!

Closer Look back at your notes. Would you consider men like John D. Rockefeller and Andrew Carnegie to be robber barons, captains of industry, or both? Why?