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The Growth of Big Business

The Growth of Big Business. Businesspeople & Investors pool resources to create huge companies Robber Barons or Captains of Industry?. Robber Baron or Captain of Industry?. Robber Baron – steal from public to build fortunes, exploit workers, etc.

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The Growth of Big Business

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  1. The Growth of Big Business Businesspeople & Investors pool resources to create huge companies Robber Barons or Captains of Industry?

  2. Robber Baron or Captain of Industry? • Robber Baron – steal from public to build fortunes, exploit workers, etc. • Captains of Industry – Serve nation in a positive way by create jobs, etc. • Most were both!

  3. 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?

  4. Social Darwinism • Society & Government should do as little as possible to interfere with someone’s pursuit of success. – laissez- faire • Those “fit” would succeed and become rich, those “unfit” would not • Survival of the fittest

  5. Question 2 • Do you agree with the concept of Social Darwinism? Explain.

  6. Andrew Carnegie

  7. Andrew Carnegie • “Gospel of Wealth” – people should be free to make as much money as they can…then give it back to society in positive ways. • Carnegie Steel Co. – Pittsburgh, PA C. Vertical Consolidation – control all businesses that make up all phases of a product’s development • Carnegie gave away 350 million by his death 1919. Great Philanthropist!

  8. John D. Rockefeller

  9. John D. Rockefeller • Standard Oil Co. – Cleveland, OH • Horizontal Consolidation – Bring competitors into the same business. “buy them out” and combine operations. • Created a Trust – A board of trustees was formed to run all companies as one • Gave away over 500 million to charities & institutions by his death

  10. Types of Big Businesses • Oligopoly – a few large profitable businesses dominate an industry • Monopoly – One company has complete control of a product or service • Cartel – competing businesses form an alliance to control prices without officially merging

  11. Question 3 • In your opinion, who used more ruthless tactics to control their respected industry Carnegie or Rockefeller? Explain.

  12. New precedent of Govt. regulation • Government Response • Sherman Anti-Trust Act 1890 – outlawed any combination of companies that restrained interstate trade or commerce. • Limits on industrial competition bad for consumer – prices rise • Sherman Anti-Trust Act ineffective • To hard to define a trust • Courts were pro-business

  13. 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.

  14. 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.

  15. Industrial Revolution changed ways of life • People moved from countryside to cities • People took jobs in factories • This created problems in the cities • No sanitation • Small, dirty houses (row house) • Not enough schools for all the kids • Factory and mine conditions were bad • People worked 14 hour days • People worked 6 days a week • Wages were low • Children as young as 6 worked in factories and mines

  16. Industrialization and Workers • Cities crowded in mid-late 1800s (urbanization) • 14 million people 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 • 1900 = 30% of labor force industrial

  17. Conditions • Harsh conditions, foremen demeaning and harsh • Dangerous machines • Fast pace • 12 hours a day • 6 days a week

  18. 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.

  19. Coal Tub

  20. 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

  21. Jacob Riis

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