Big Business and Labor Chapter 14 Section 3 Notes

Andrew Carnegie’s Innovations Leaves Pennsylvania RR and goes into steel business (1873) By 1899 manufacturing more steel than Great Britain Why so successful? better products cheaper new machines and techniques encourage competition w/in business & offer stock in co. Vertical integration (bought out suppliers) control raw materials & trans. Horizontal integration- buy out co. w/ similar products

Andrew Carnegie

Social Darwinism and Business Principles Social Darwinism (biological evolution and “natural selection”) Herbert Spencer “laissez faire”, market place not regulated Success and failure governed by natural law Definition of success- if poor it’s b/c lazy or inferior to rich people

Fewer Control More Big mergers (horizontal integration)- one co. buys out the stock of another Idea of monopoly emerges Holding companies (create one co. just to buy out others) Carnegie Trust agreements (companies turn stocks over to group of trustees) Rockefeller w/ Standard Oil Company, not legal “Robber Barons”

-Rockefeller low payments to employees sell oil low so other companies go out of business when all other companies gone, raise prices higher than ever people upset with Rockefeller and Carnegie but both gave huge amounts of money to different organizations and foundations

John D. Rockefeller

Carnegie & Rockefeller Contributions

Sherman Antitrust Act (1890) Difficult to enforce South still recovering from Civil War (mostly agricultural) Farmers going into debt due to RR co.

Labor Unions Emerge Work seven days a week, 12 hour days No vacation, sick leave, workers comp. Poor working conditions in factories, many injuries Everyone in family must work to survive (no schooling) Ave. man $498 and woman $267 a year (Carnegie-$23 million, and he didn’t pay income tax!!!!!!) National Labor Union (NLU) 1866 Convinced congress to legalize 8 hour work day

Union Movements Diverge Craft Unions Samuel Gompers (Cigar Makers’ Union) led way in joining craft unions together American Federation of Labor (AFL) Work on negotiations between employer and employee Used strikes as major tactic Skilled & Unskilled workers unite in American Railway Union (ARU) under Eugene V. Debs Debs and other leaders start to turn to socialism and create new union Industrial Workers of the World (IWW)- Wobblies

Strikes Turn Violent Great Strike of 1877 (B&O RR) Haymarket Affair Week long RR covering +50,000 mi. stopped Pres. Hayes has to send troops to stop strike Haymarket Affair Chicago May 4, 1886 Protesting police brutality at strike the day before Police try to break up crowd, but bomb is thrown into crowd Violence breaks out, 7 police & 7 strikers die Speakers charged all convicted –4 hung, 1 suicide

Great Strike of 1877

Haymarket Affair

Homestead Strike Pullman CO. Strike 1894 Carnegie Steel CO. Strike begins on June 29, 1892 Battle between strikers, scabs, and guards Plant stays closed till November In end gave into company Pullman CO. Strike 1894 Began in Pullman, IL Workers go on strike after wages reduced Involved 250,000 workers & 27 states President Cleveland orders troops to end strike Brings question if President has that authority

Homestead Strike

Pullman Strike

Women Organize Mary Harris Jones “Mother Jones” Helped pass child labor laws Triangle Shirtwaist Factory fire draws attention to working conditions Workers couldn’t get out b/c doors locked, no sprinkler system, fire escape didn’t work 146 women die

Triangle Shirtwaist Factory

Management doesn’t recognize unions, won’t allow workers to join Avoid strikes by saying it hurts interstate trade, govt. would step in Sherman anti-trust works against Unions