1. Agenda Quick Review – Gilded Age Politics The Rise of Monopolies
SS 10: Analyze the similarities and differences between the ideologies of Social Darwinism and the Social Gospel.
SS 13: Describe the rise of trust and monopolies, their subsequent impact on consumers and workers, and the gov’ts response – include the Sherman Anti – Trust Act of 1890.

2. Industrial Revolution
The Second
Industrial Revolution

3. Causes of Rapid Industrialization
Steam Revolution of the 1830s-1850s led to the creation of the RR Industry.
The Railroad
First big business in the US.
A magnet for financial investment.
The key to opening the West.
Aided the development of other industries.

4. Causes of Rapid Industrialization
Inventions of the helped spur the Industrial Revolution
Inventor
Invention / Contribution
Henry Bessemer(9)
The Bessemer Process – A process of making steel faster and more durable.
George Pullman (6)
The Sleep R.R. Car
George Westinghouse (7)
Alternate Current
Gustavius Swift (12)
Phillip Armour (14)
The Refrigerated R.R. Car
Canned Meat
Milton Hershey (13)
Chocolate
Thomas Edison (10)
The Light bulb, phonograph, motion picture
Alexander Graham Bell (8)
Tellephone
Wilbur and Orville Wright
The Airplane

5. Causes of Rapid Industrialization
Unskilled & semi0skilled labor abundance.
Mass Production (17) : The manufacture of goods in large quantities by machinery and by use of techniques such as the assembly line.
Abundant capital.
New, talented group of businessmen [entrepreneurs] & advisors.
Market growing as US population increased.
Gov’t willing to help stimulate economic growth.
Abundant natural resources.

6. New Business Culture
Laissez Faire  the ideology of the Industrial Age.
Capitalism at its finest
Individuals should compete freely in the marketplace.
No room for government in the market

7. Some tried to gain “monopolies” (19) …
To gain complete control of a product or service; consumers have no other choices
Many created monopolies through trusts. A trust is where companies in related fields agree to combine under the direction of a single board of trustees, which meant that shareholders had no say. (Illegal today)

8. During the Industrial Era (Gilded Age) there were two main ways in which to build a monopoly.

9. The first is Horizontal Integration – the process of taking over companies / businesses in your industry.

10. The Second is Vertical Integration – the process of buying companies at all levels of production
** Remember, because the I.R. is happening during the Gilded Age, corruption and poor business ethics is rampant.

11. Who were the Big Business Tycoons?
Industrialization & the Rise of Big Business
Who were the Big Business Tycoons?
Andrew Carnegie (3) – steel
Cornelius Vanderbilt (2) – railroads
John D. Rockefeller (4) – oil
J.P. Morgan (5) – banking

12. Small businesses complained “monopolies” eliminated fair competition
ROBBER BARRONS
robber
Extortion: Forced against your will
Rebates: discount or refund on “freight charges”
Drawbacks / Kickbacks: Standard Oil gave certain railroads all its shipping business if it agreed to charge Standard Oil 25% to 50% less than its competitors
Buyouts: Larger corporations forced smaller businesses to sell out
Congress was “bought out” by the monopolies
Spies: Stealing your competitor's ideas
Small businesses complained “monopolies” eliminated fair competition

13. Robber Baron (18)
Tycoons that bought out small businesses, formed monopolies, manipulated the gov’t to their needs, and swindled the poor
Captains of Industry
Big businesses provided jobs, strengthened the economy, improved technology, and donated money to universities, charities, etc.
***Andrew Carnegie’s “Gospel of Wealth”
Philanthropy

14. “Captains of Industry”
CAPTAINS OF INDUSTRY OR ROBBER BARONS
“Robber Barons”
Business leaders built their fortunes by stealing from the public.
They drained the country of its natural resources.
They persuaded public officials to interpret laws in their favor.
They ruthlessly drove their competitors to ruin.
They paid their workers meager wages and forced them to toil under dangerous and unhealthful conditions.
“Captains of Industry”
The business leaders served their nation in a positive way.
They increased the supply of goods by building factories.
They raised productivity and expanded markets.
They created jobs that enabled many Americans to buy new goods and raise their standard of living.
They also created museums, libraries, and universities, many of which still serve the public today.

15. Social Darwinism (20) Herbert Spencer British economist.
Advocate of laissez-faire.
Used Darwin’s Theory of Natural Selection to explain the economic evolution of human society.
Wealth was the result of strong work ethic.
The poor are lazy and inferior and deserved no aid.
Notion of “Survival of the Fittest.”
Herbert Spencer

16. Standard Oil Co.

17. The “Protectors” of Our Industries

18. The ‘Bosses’ of the Senate

19. The Robber Barons’of the Past

20. “On Wealth” The Anglo-Saxon race is superior.
“Gospel of Wealth” (1901).
Inequality is inevitable and good.
Wealthy should act as “trustees” for their “poorer brethren.”
Andrew Carnegie

21. Regulating the Trusts
1886  Wabash, St. Louis & Pacific Railroad Company v. IL
The decision led to the creation in 1887 of the first modern regulatory agency, the Interstate Commerce Act  (11) - federal law that was designed to regulate the railroad industry, particularly its monopolistic practices
It was one of the first instances in gov’t assuming responsibility for economic affairs that had previously been delegated to the states.
1890  Sherman Antitrust Act (6)
was the first measure passed by the U.S. Congress to prohibit trusts/monopolies.
Very weak and truly not enforced

22. Pair Up
#1 with #2
#3 with #4
#1 and #3 – you have 20 seconds to explain to your partner what a monopoly is.
#2 and #4 – you have 20 seconds to explain to your partner what Social Darwinism is.
#1 and #3 – you have 20 seconds to explain to your partner how Social Darwinism allowed Robber Barons to get away with their actions.
#2 and #4 – you have 20 seconds to explain to your partner The importance of the Sherman Anti – Trust Act

23. S.O.A.P.S.TONE Subject – what is the document about?
Occasion – What is the situation? (Time period, location, event?)
Audience – To what group of people is the document directed?
Purpose – Why was the document created? (To explain, inform, persuade, etc …)
Speaker – Who is the author of the document?
TONE – what is the author’s attitude toward the topic?

24. “This then is held to be the duty of the man of wealth
“This then is held to be the duty of the man of wealth. First: to set an example of modest, unostentatious living, shunning display; to provide moderately for the legitimate wants of those dependent upon him, and after doing so, to consider all surplus revenues which come to him simply as trust funds, which he is strictly bound as a matter of duty, to administer in the manner which in his judgment is best calculated to produce the most beneficial results for the community. The man of wealth must become a trustee and agent for his poorer brethren, bringing to their service his superior wisdom, experience, and ability to administer.”
-Andrew Carnegie

25. "The growth of large business is merely a survival of the fittest…the American Beauty rose can be produced in splendor and fragrance which brings cheer to its beholder only by sacrificing the early buds which grow up around it. This is not an evil tendency in business. It is merely the working out of the law of nature and the law of God."
-John Rockefeller