1. The Industrial Revolution (1865-1900)

2. Laissez-faire Economics
The U.S. Gov’t policy was “hands off”
Businesses had little gov’t regulation
Economy 100% governed by the Laws of Supply and Demand!
Entrepreneurs-people who start independent businesses
Factors of Production-land, labor, and capital
Capital-money
CLASS NOTES

3. Corporations Merge
Corporation – people get a charter & sell shares of stock to raise capital
Monopoly – Corporations combine to control an entire industry or service
Trust – Companies ally and turn assets over to board of trustees, may offer many brands, but really ran as one company
The goal was to restrict competition and maximize profits!
CLASS NOTES
Is Wal-Mart a monopoly????

4. Are Monopolies Good or Bad?
Interstate Commerce Commission (1887)- established to monitor the RR industry by investigating unfair practices.
Sherman Antitrust Act (1890) – Outlawed business practices that restricted free trade. But it was rarely enforced for 15 years – Why?

5. Andrew Carnegie and Steel
13 yr-old Scottish Immigrant earned $1.35-wk (1848)
Carnegie Steel (1889)
Used Vertical Integration (coal, RR’s, iron mines) to force competitors out

6. John D. Rockefeller and Oil
1st oil well in Titusville, PA (1859)
Cleveland, OH Refinery built in 1863
Standard Oil Trust formed in 1870 via Horizontal Integration
He drove his competitors out of business as he sidestepped laws

7. Horizontal and Vertical Integration

8. Social Darwinism and the “Gospel of Wealth”
The “Gospel of Wealth” - Carnegie said “millionaires are the bees that make the most honey”
Based on Charles Darwin’s theory of evolution (1859)
Social Darwinism – a theory held that gov’t shouldn’t interfere with business and the fittest will become rich

9. Inventors of the Industrial Age
The government’s policy toward the economy after the Civil War can be described as
a. very involved b. little involved
In 1883, the move to Standard Time was driven by the _______ industry.
a. steel b. coal mining c. auto d. railroad
He is credited with the invention of the electric light?
a. Edison b. Bell c. Gates d. Swift
Which of the following was not an important industry in post-Civil War America?
a. Steel b. Oil c. Telegraph d. Electronic

10. Robber Barons or Captains of Industry?
Did the wealthy “rob” from the public trust (politicians), workers, and environment to build empires?
Did their contributions (jobs, goods, services, and philanthropy) outweigh the bad?

11. Workers a family affair Child Labor – 1/5 ages 10-16 worked!
No welfare only over-burdened charities!
12-hour days, 6- day weeks!
Unsafe conditions – 1882 avg. 675 deaths/ week – 120 today
CLASS NOTES

12. The Rise of Labor Unions
1820s - Collective Bargaining – negotiating as a group for better wages or benefits
Strike - a work stoppage to voice demands
Socialism – favors government not private control over industries and sharing of the wealth!
CLASS NOTES

13. Early Labor Unions Knights of Labor (1869) – skilled and unskilled
American Federation of Labor (1886) – craft unions – more exclusive than the Knights
1890 Census – 9% controlled 75% of wealth

14. The Great Strikes!
1877 RR Strike – President Hayes uses federal troops to break strike: violence in many cities b/c of pay cut.
Haymarket Square (1886) – Chicago, 8 HR Day, bomb!, dozens killed! Knights of Labor’s was blamed and union membership declined.
Homestead, PA (1892) – Carnegie Steel – he cut wages then used violence to break the steel union!
Pullman Strike (1894) – 120,000 ARU and Eugene V. Debs protested 25% pay cut – 30 killed- Pres. Cleveland sent in troops – Debs to jail