Transcript The Growth of Big Business

Question 1
• What is your general opinion of “big business”
in America? How do you view the owners of
these major corporations, etc.?
• Is “big business” good for the American
economy and consumers?
• Do you think the owners of major
corporations are inherently more talented
than other businessmen?
The Growth of Big Business
I. Businesspeople & Investors pool
resources to create huge
companies
A. Robber Barons or Captains of
Industry?
Robber Baron or Captain of
Industry?
1. Robber Baron – steal from public to build
fortunes, exploit workers, etc.
2. Captains of Industry – Serve nation in a positive
way by create jobs, etc.
3. Most were both!
II. Social Darwinism
A. Society & Government should do as little as
possible to interfere with someone’s pursuit of
success. – laissez- faire
B. Those “fit” would succeed and become rich,
those “unfit” would not
C. Survival of the fittest
D. Adam Smith – Father of Capitalism
Question 2
• Do you agree with the concept of Social
Darwinism? Explain.
How Big Business Differed
from in the Past
Business was growing on a larger scale than ever
before. Why…
1. Larger pools of Capital
2. Wider Geographic Span
3. Broader Range of Operations
4. Revised Role of Ownership
5. New Methods of Management
V. Types of Big Businesses
A. Oligopoly – a few large profitable businesses
dominate an industry
B. Monopoly – One company has complete control
of a product or service
C. Cartel – competing businesses form an alliance
to control prices without officially merging
Andrew Carnegie
III. Andrew Carnegie
A. “Gospel of Wealth” – people should be free to
make as much money as they can…then give it
back to society in positive ways.
B. Carnegie Steel Co. – Pittsburgh, PA
C. Vertical Consolidation – control all businesses
that make up all phases of a product’s
development
A. Carnegie gave away 350 million by his death
1919. Great Philanthropist!
John D. Rockefeller
IV. John D. Rockefeller
A. Standard Oil Co. – Cleveland, OH
B. Horizontal Consolidation – Bring competitors
into the same business. “buy them out” and
combine operations.
C. Created a Trust – A board of trustees was formed
to run all companies as one
D. Gave away over 500 million to charities &
institutions by his death
Question 3
• In what ways was business changing from that
of business in the past?
• In your opinion, who used more ruthless
tactics to control their respected industry
Carnegie or Rockefeller? Explain.
New precedent of Govt. regulation
VI. Government Response
A. Sherman Anti-Trust Act 1890 – outlawed any
combination of companies that restrained
interstate trade or commerce.
B. Limits on industrial competition bad for
consumer – prices rise
C. Sherman Anti-Trust Act ineffective
1.
2.
To hard to define a trust
Courts were pro-business
Question 4
• What role do you think the government
should play in our economy?
• Should the government have the right to
break up monopolies? Explain.
Captains of Industry Project
• Get into groups of 4. You must do your best to
have 2 girls and 2 boys in each group.
• Assign someone to be the “team leader”, and
send them up to see me to get the directions
for the project.
• Ignore this slide for now
Industrialization and Workers
• Cities crowded in mid-late 1800s
(urbanization)
• 14 million people immigrated to US between
1860-1900
• 8-9 million Americans moves off farms to
cities in late 1800s.
• 1860 = 20% urban workers / 80% rural
• 1900 = 40% urban / 60% rural
Industrial Revolution changed ways of life
1. People moved from countryside to cities
2. People took jobs in factories
3. This created problems in the cities
a. No sanitation
b. Small, dirty houses (row house)
c. Not enough schools for all the kids
d. Poverty
e. Crime/Violence
f. Overcrowded
g. Fires
4. Factory and mine conditions were bad
a. People worked 14 hour days
b. People worked 6 days a week
c. Wages were low
d. Children as young as 6 worked in factories and mines
e. Dangerous machines / Harsh foreman / Fast pace
• Piecework = those who produced the most,
the fastest got paid the most
• Sweatshops = long hours, low pay, poor
conditions
• Division of labor = brake tasks down into steps
• Took joy, pride, and quality out of work
• Childhood labor common = 5% of industrial
labor in 1880s.
• Uneducated kids, stunted growth, health
issues, vices, etc.
Coal Tub
Jacob Riis
• Very little change due to social Darwinism.
• Public made aware by “muckraking”
journalists such as Jacob Riis
• Children of the Poor
• How the Other Half Lives
Jacob Riis
Question 5
• How was the “way in which” work was getting
done changing in the 1800s from previous
times?
• What impact did industrialization and
Urbanization have on working class Americans
and life in our cities?