1. Lecture: Trusts & Government Corruption
The American Industrial Revolution

2. Bell Ringer Complete RSG 6.3 “Big Business & Labor”
Highlight important words and phrases
Complete the graphic organizer
Answer the questions
Reminder:
Please get started immediately!!!
No talking after the bell!!!
If you forgot your RSG then work on your packet…

3. Trusts and Government Corruption
What do you see here?
What to the men wearing top hats represent?
Who are the men at the desks?
What is the intended message of the cartoonist?

4. Standard
Discuss corporate mergers that produced trusts and cartels and the economic and political policies of industrial leaders.

5. Objective
Students will be able to discuss the economic and political policies of industrial leaders by creating a sensory figure.

6. Rise of Industrial Trusts
Corporation:
A form of business organization that enables a group of individuals to operate as a single “artificial legal person” It can sue and be sued, hire and fire, buy and sell, manufacture and trade.
Advantages:
Securing of Capital: Can buy stocks and bonds
Limited liability
One can easily transfer out of corporation buy selling shares
Perpetual life

7. Merger: the consolidation of two companies into a single corporation
Horizontal Integration: Companies producing similar products merge
Vertical Integration: Companies producing different products merge A
Steel Co. A B
Steel Co. B C
Steel Co. C
Steel Corporation
Railroad Corporation
Train Manufacturer

8. Monopoly
The elimination of competition.
Combined corporations in order to control prices, production, and sales of territory
Pool: a secret agreement among competing companies to fix prices and output, or to divide sales territory.
By the Interstate Commerce Act (1887) railroad pools were declared illegal

9. Monopoly
Trust: Stockholders of competing companies turned their stock over to a board of trustees and in exchange received trust certificates. In this way, the board of trustees gained full control and managed the member companies in such a way as to eliminate competition.
The Sherman Anti-Trust Act (1890) made trusts illegal

10. Examples of Business Consolidations
OIL: John D. Rockefeller: Standard Oil Company
By 1879 controlled 90% of the countries oil refineries

11. Film Clip: Oil Industry

12. Examples of Business Consolidations
STEEL: Andrew Carnegie: Carnegie Steel Company
1900 – producing ¼ of countries steel
J.P. Morgan: formed a steel monopoly: The U.S. Steel Corporation

13. Film Clip: The Steel Industry
Film Clips can be purchased at unitedstreaming.com

14. Examples of Business Consolidations
RAILROAD: Cornelius Vanderbilt: Merged Eastern RR’s.

15. Film Clip: Railroad Industry
Film Clips can be purchased at unitedstreaming.com

16. Examples of Business Consolidations
OIL: John D. Rockefeller: Standard Oil Comany
By 1879 controlled 90% of the countries oil refineries
STEEL: Andrew Carnegie: Carnegie Steel Company
1900 – producing ¼ of countries steel
J.P. Morgan: formed a steel monopoly: The U.S. Steel Corporation
RAILROAD: Cornelius Vanderbilt: Merged Eastern RR’s.

17. 1. Who is this man. 2. What is he doing. 3
1. Who is this man? 2. What is he doing? 3.What type of merger does this cartoon represent?

18. Advantages of Big Business
Mass Production
Ex. assembly line, division of labor, standardization of parts
Wide Distribution: Used advertising and sold products across nation
Efficient Management
Able to hire best executives, maintain costly research laboratories and raise capital for expansion

19. Abuses of Big Business
Elimination of competition
Large corporations drove out small businesses
Power over the consumer
Could force consumer to pay high prices and accept inferior quality

20. Abuses of Big Business Exploitation of workers
Pay low wages, long working hours, prevented them from forming unions
Influence over the government
Manipulated government at federal, state and local levels
Industrial giants ran for government offices, made generous contributions to political candidates, and bribes legislatures
Political “Machines” and “bosses” – political favors given in exchange for votes

21. Pair-Share
Describe the corporate mergers that were produced by trusts and cartels and the policies of the industrial leaders.