American History Content Statement 10 & 11 The Rise of Big Business Mr. Leasure 2013 – 2014 Harrison Career Center

Related Key Terms You must write these down – completely!

Ohio Content Statements Met: 10.The rise of corporations, heavy industry, mechanized farming and technological innovations transformed the American economy from an agrarian to an increasingly urban industrial society. 11.The rise of industrialization led to a rapidly expanding workforce. Labor organizations grew amidst unregulated working conditions and violence toward supporters of organized labor.

Student Objectives: The student will be able to analyze the growth of corporations. The student will be able to describe monopolies and trusts and evaluate their effects. The student will be able to summarize the positive and negative affects of the Gilded Age. The student will be able to evaluate the development of the economy of the South.

Related Key Terms 1.Robber Barron - A business leader who became wealth through dishonest methods. 2.Corporation – A business owned by investors who buy part of a company through shares of stock.

Related Key Terms 3.John D. Rockefeller – The man who dominated the oil industry. 4.Andrew Carnegie – The man who dominated the steel industry.

Related Key Terms 5.Monopoly – A company that wipes out its competitors and controls an industry. 6.Trust – A legal body created to hold stock in many companies, often in the same industry.

Related Key Terms 7.Philanthropist – People who gave large sums of money to charities. 8.Gilded Age – An era during the late 1800s of fabulous wealth

How did businesses change in the late 1800s? Key Question #1

How did businesses change? Until the late 1800s, most businesses were owned directly by one person or by a few partners.

How did businesses change? The advances in technology made many business owners want to buy new equipment but new equipment was too expensive.

How did businesses change? One was to raise money to purchase new equipment was to turn their business into a corporation.

How did businesses change? A corporation is a business owned by investors who buy part of the company though shares of stock.

How did businesses change? A corporation has advantages over privately owned businesses. These advantages include the following:

How did businesses change? By selling stock, a corporation can raise large amounts of money.

How did businesses change? A corporation has special legal status and continues to exist after its founders die.

How did businesses change? Banks are more likely to lend a corporation money.

How did businesses change? A corporation limits the risks to its investors, who do not have to pay off the corporations debt.

How did businesses change? In the late 1800s, few laws regulated corporations.

How did businesses change? This led to the growth of a few giant corporations that dominated American industry.

How did businesses change? The oil and steel industries are examples of this process.

What methods did Rockefeller and Carnegie use to control their industries? Key Question #2

..to control their industry? John D. RockefellerAndrew Carnegie

..to control their industry? In the late 1800s, the oil and steel industry quickly grew. John D. Rockefeller led the oil industry and Andrew Carnegie led the steel industry.

..to control their industry? Rockefeller built his first refinery in He decided the best way to make money was to put his competition out of business.

..to control their industry? A company that puts its competitors out of business and controls an industry is a monopoly. Rockefeller bought other refineries.

..to control their industry? Rockefeller’s most famous move to control the industry was to end competition by forming trusts. A trust is a legal body created to hold stock in many companies, often in the same industry.

..to control their industry? Rockefeller’s trust was called the Standard Oil Trust. By 1880, his trust purchased enough stock to control 95% of all oil production in the United States.

..to control their industry? Because he controlled 95% of all oil production in the U.S., Rockefeller could charge any price for oil and the people would have to pay it.

..to control their industry? As the head of the Standard Oil Trust, Rockefeller was able to earn millions of dollars. Because of this, Rockefeller became known as a ruthless robber baron.

..to control their industry? By contrast, Andrew Carnegie tried to beat out his competition instead of buying his competition.

..to control their industry? To make his steel cheaper than his competition, Carnegie made certain to control all aspects of production related to making steel.

..to control their industry? He bought the mines that supplied the ore, and the trains and ships that moved the ore to his factories.

..to control their industry? Rockefeller and Carnegie were multimillionaires. They were both philanthropist and gave large sums of money to charities.

..to control their industry? Over the course of their lives, Rockefeller gave away 500 million dollars and Carnegie gave away 350 million dollars. * To date, Bill Gates has given away 28 billion dollars.

What were some of the characteristics of the “Gilded Age”? Key Question #3

..of the “Gilded Age”? The rags to riches stories of people such as Rockefeller and Carnegie inspired many Americans to believe they too could grow rich.

..of the “Gilded Age”? Most people who made millions of dollars had not been raised in poverty. Many people belonged to the upper class and attended college.

..of the “Gilded Age”? Most began their careers with the advantage of money or family connections.

..of the “Gilded Age”? For the rich, the late 1800s was a time of fabulous wealth and Mark Twain named the era the Gilded Age.

..of the “Gilded Age”? To gild is to coat an object with gold leaf. Just as gold leaf can disguise an object of lesser value, so did the wealth of a few people mask societies problems.