Age of Big Business Age of Monopolies. Background: Capitalism – economic system. Private ownership of the means of production Free enterprise – to meet the demands Profit motive – goal to make $ Market price – buyers & sellers Competition. New Business Culture.
1. Laissez Fairethe ideology of the Industrial Age.
William Graham SumnerFolkways (1906)
3. Protestant (Puritan) “Work Ethic”
Is the idea of the “self-made man” a MYTH??
“Wizard of Menlo Park”
Wilbur Wright Orville Wright
Kitty Hawk, NC – December 7, 1903
Henry FordI want to pay my workers so that they can afford my product!
1790s 276 patents issued.
1990s 1,119,220 patents issued.
Industrialization increased the standard of living and the opportunities of most Americans, but at what cost?
* See slide # 23
Can’t I do what I want with my money?
Frederick W. Taylor
The Principles of Scientific Management (1911)
% of Billionaires in 1918
Do millionaires/ billionaires have a responsibility to help the poor?
State of Illinois had passed Granger Laws to set rates of railroads and grain elevators
Did Illinois law deprive railroads of property (profits) without due process?
State law was constitutionalbecause the law was related to the public interest
Railroad rates continued to be limited by the state governmentMunn v. Illinois (1877)
Long-haul, short-haul discrimination by the railroads within the state of Illinois (penalties were applied)
Could the state regulate railroads on the intrastate portion of an interstate trip?
State law was unconstitutional
The power to regulate interstate commerce belongs to Congress
Put pressure on Congress to act if the states can’t regulate the railroads
One year after the decision Congress passed the Interstate Commerce ActWabash, St.Louis, & Pacific Railway Co. v. Illinois (1886)
American Sugar Refining Co. bought stock in smaller companies & controlled 90% of sugar processed in U.S.
Can Congress regulate manufacturing?
Can Congress outlaw “manufacturing monopolies”?
Federal Gov’t cannot regulate refineries because they were manufacturing operations, not directly related to interstate commerce
State gov’t. can regulate local activities under the terms of 10th Amendment
Few attempts made to prosecute corporations in restraint of trade (most against unions as “unreasonable restraint of trade”!)United States v. E.C. Knight Co. (1895)