1. CAPITALISM AND THE U.S. ECONOMY – LATE 1800’S 4.3 EVALUATE THE ROLE OF CAPITALISM AND ITS IMPACT ON DEMOCRACY, INCLUDING THE ASCENT OF NEW INDUSTRIES, THE INCREASING AVAILABILITY OF CONSUMER GOODS AND THE RISING STANDARD OF LIVING, ENTREPRENEURS, AND THE INFLUENCE OF MONOPOLIES.

2. III. CAPITALISM A.Capitalism – economic system with private property and use of property to make a profit. 1.Individual freedom 2.Opportunity 3.Businesses allowed to succeed or fail on their own

3. B. CORPORATIONS 1.A corporation is a business that sells stock in order to generate money for new products/inventions. 2.Stockholders then share in a percentage of the corporation’s profits.

4. C. MONOPOLIES 1.Occurs when one person or one company controls the complete supply of a product or service. 2.Two types 1.Horizontal integration 2.Vertical integration

5. D. RAILROADS DRIVE THE ECONOMY 1.Connection of the country – east to west. 2.Supplies and products pour into west – all taken by rail!! 3.Other businesses thrive a.Steel, lumber, meat packing, coal, and many others.

6. 4.Boom towns a.Towns and cities grow along rail routes – Chicago, St. Louis, Omaha 5.Railroad corporations a.Several large rail companies begin to buy up smaller ones – Cornelius Vanderbilt b.Create monopolies 1)Drives up prices 2)Farmers are hardest hit

7. E. “ROBBER BARONS OR CAPTAINS OF INDUSTRY” 1.Andrew Carnegie a.Takes over the steel industry b.Vertical integration 2.John D. Rockefeller a.Takes over the oil industry b.Horizontal integration 3.J.P. Morgan a.Banking industry b.General Electric c.Buys railroads and steel companies to create monopolies

8. F. PROBLEMS WITH CAPITALISM 1.Can create extreme wealth and extreme poverty. 2.Corporations may take advantage of consumers 3.Corporations may not protect the rights of workers. a.Profit v. Safety 4.Laissez-Faire 1.“hands off” of business approach by government

9. G. SHERMAN ANTI-TRUST ACT 1.Congress responds to demands to control monopolies. 2.Act makes it illegal for businesses to form monopolies 3.Protects against unnecessary rise in prices 4.Not effectively enforced until Teddy Roosevelt.

10. H. OTHER KEY IDEAS OF ERA 1.Social Darwinism a.Applies theory of evolution to humans – strongest survive or succeed, others die off 2.Philanthropist - “love of mankind” a.Andrew Carnegie gives wealth away towards end of his life b.Gospel of Wealth – belief that the wealthy have obligation to improve society. Estimates state that Andrew Carnegie donated $350 million to build libraries, museums, and fund other projects around the world. Today, that would equal nearly $4 billion.