Rise of Big Business - US History - Home
Transcript of Rise of Big Business - US History - Home
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Essential Question
Industrialization increased the standard
of living and the opportunities of most
Americans, but at what cost?
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Causes of Rapid Industrialization
1. Steam Revolution of the 1830s-1850s.
2. The Railroad fueled the growing US economy: First big business in the US.
A magnet for financial investment.
The key to opening the West.
Aided the development of other industries.
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Causes of Rapid Industrialization
3. Technological innovations. Bessemer and open hearth
process
Refrigerated cars
Edison o “Wizard of Menlo Park”
o light bulb, phonograph, motion pictures.
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Thomas Alva Edison
“Wizard of Menlo Park”
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The Light Bulb
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The Phonograph (1877)
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The Ediphone or Dictaphone
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The Motion Picture Camera
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Alexander Graham Bell
Telephone (1876)
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Alternate Current
George Westinghouse
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Alternate Current
Westinghouse Lamp ad
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The Airplane
Wilbur Wright Orville Wright
Kitty Hawk, NC – December 7, 1903
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Model T Automobile
Henry Ford I want to pay my workers so that they can
afford my product!
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“Model T” Prices & Sales
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U. S. Patents Granted
1790s 276 patents issued.
1990s 1,119,220 patents issued.
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4. Unskilled & semi-skilled labor in abundance.
5. Abundant capital.
6. New, talented group of businessmen [entrepreneurs] and advisors.
7. Market growing as US population increased.
8. Government willing to help at all levels to stimulate economic growth.
9. Abundant natural resources.
Causes of Rapid Industrialization
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New Business Culture
1. Laissez Faire the ideology of the Industrial Age.
Individual as a moral and economic ideal.
Individuals should compete freely in the marketplace.
The market was not man-made or invented.
No room for government in the market!
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2. Social Darwinism
British economist.
Advocate of laissez-faire.
Adapted Darwin’s ideas from the “Origin of Species” to humans.
Notion of “Survival of the Fittest.”
Herbert Spencer
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2. Social Darwinism in America
William Graham Sumner Folkways (1906)
$ Individuals must have absolute freedom to struggle, succeed or fail.
$ Therefore, state intervention to reward society and the economy is futile!
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New Business Culture: “The American Dream?”
3. Protestant (Puritan) “Work Ethic” Horatio Alger [100+ novels]
Is the idea of the “self-made man” a MYTH??
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New Type of Business Entities 1. Pool
1887 Interstate Commerce Act Interstate Commerce Commission created.
2. Trust John D. Rockefeller
Standard Oil Co.
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Standard Oil Co.
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New Type of Business Entities
2. Trust: Horizontal Integration John D.
Rockefeller
Vertical Integration: o Gustavus Swift Meat-packing
o Andrew Carnegie U. S. Steel
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Iron & Steel Production
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New Type of Business Entities
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U. S. Corporate Mergers
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New Financial Businessman
The Broker: J. Pierpont Morgan
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Wall Street – 1867 & 1900
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The Reorganization of Work
Frederick W. Taylor The Principles of Scientific Management (1911)
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The Reorganization of Work
The Assembly Line
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% of Billionaires in 1900
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% of Billionaires in 1918
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The Protectors of Our Industries
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The ‘Bosses’ of the Senate
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The ‘Robber Barons’ of the Past
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Cornelius [“Commodore”] Vanderbilt
Can’t I do what I want with my money?
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William Vanderbilt
$ What do I care about the law? H’aint I got the power?
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The Gospel of Wealth: Religion in the Era of Industrialization
Russell H. Conwell
$ Wealth no longer looked upon as bad.
$ Viewed as a sign of God’s approval.
$ Christian duty to accumulate wealth.
$ Should not help the poor.
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“On Wealth”
Andrew Carnegie
$ The Anglo-Saxon race is superior.
$ “Gospel of Wealth” (1901).
$ Inequality is inevitable and good.
$ Wealthy should act as “trustees” for their “poorer brethren.”
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Regulating the Trusts
1877 Munn. v. IL
1886 Wabash, St. Louis & Pacific Railroad Company v. IL
1890 Sherman Antitrust Act in “restraint of trade”
“rule of reason” loophole
1895 US v. E. C. Knight Co.
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Relative Share of World Manufacturing
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Modern ‘Robber Barons’??