Big Business and Organized Labor: In Conflict. GUIDED READING ACTIVITY. The Sole Proprietorship.
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GUIDED READING ACTIVITY
Sole Proprietorships have a number of advantages – owners have complete control over the company, and they get to keep all the profits. However, they also have to come up with all of the start-up costs, work extremely hard, and accept all the risk if the company fails!
Partnerships have a number of advantages over sole proprietorships : its easier to raise money working with a partner, its easier to divide the workload, and you share the risks of the company failing. However, you also have to share all the profits, and occasionally, arguments will undermine your business.
Corporations are businesses owned by many investors, or stockholders. Corporations can easily raise money to purchase needed resources. As a shareholder, you are a part owner of a company, but you risk only what you have invested.
Being a shareholder is a much easier way to own a company than founding your own business. You can invest as much or a little as you please, and you are not responsible for running the company – a board of directors does that for you. The only down side is that you are not likely to make lots and lots of money in the process. Sometimes the corporation will pay dividends during times of profit. Otherwise, you have to sell your shares of ownership in order to make money. The purpose of the corporation is to make more money!
Because corporations main goal is just to make money, they don’t always act in the most responsible manner. Some corporations used unfair methods to eliminate competition and raise prices on consumers – a move which hurts free enterprise, and hurts consumers, but benefits the corporation and its shareholders. Corporations have used the profit motive to justify poor working conditions, unfair business practices like trusts, pools, or monopolies, and other forms of corruption.
“I see in the near future a crisis approaching that unnerves me and causes me to tremble for the safety of my country. As a result of the war, corporations have been enthroned and an era of corruption in high places will follow, and the money power of the country will endeavor to prolong its reign by working upon the prejudices of the people until all wealth is aggregated in a few hands and the Republic is destroyed.”
On the other hand, companies like Andrew Carnegie’s US Steel company and Rockefeller’s Standard Oil provided the resources to build much of the United States – creating jobs for people and unifying the nation.
By using his banks to invest in troubled railroads – then merging the railroads with rival companies to decrease competition and increase prices – J.P. Morgan was able to make an enormous fortune. His companies were known for unfair business practices.
Monopolies are companies which have eliminated all competition in their particular field of the economy. Without competitors, companies can charge extremely high prices, hurting consumers and workingmen. If rivals attempt to emerge, monopolies can usually strangle them out of the market by undercutting them.
John D. Rockefeller
The Standard Oil Trust
Carnegie Steel helped to build America – from the railroads spanning the country to the skyscrapers touching the sky to the Brooklyn Bridge, connecting the major population centers of New York.l
Cornelius Vanderbilt consolidated most of the Railroads in the state of New York and created a vast fortune for himself and his family. Like many other aristocrats of the Gilded Age, he became a great philanthropist after accumulating great wealth.
Trusts are combinations of businesses which join together in order to decrease or eliminate competition and raise prices. The most notorious of these was the Standard Oil Trust, which had a strangle hold on the petroleum industry for decades.
Women outnumbered men in a number of workplaces, including the ones below:
The Textile Mills – of the Cotton Industry
The Tobacco Factories of the South
Garment Factories of New York City
Children were forced to work in a variety of fields, including all of the following:
textiles, tobacco factories, coal mines,
Sadly, these children were not allowed to go to school – they had to work for their families.
The dangers faced on the job were numerous, depending on the type of work men and women did.
Coalminers could face cave-ins or air quality issues that caused immediate dangers or long-term concerns like emphysema or “black lung.”
Textile workers often faced lung disease from exposure to tiny cotton fibers.
Steelworkers were in danger of burns or crushing injuries constantly.
Women faced issues with their lungs from working in textile mills as well, breathing in cotton and fiber filaments all day. Many women and children lost fingers and toes in the high velocity machines as well.
Due to the open cauldrons of molten steel, and the heavy mechanized tools which could crush limbs, steel mills were notoriously dangerous. And most companies offered no compensation to workers injured on the job.
Due to the de-assembly line methods used in meat packing plants – requiring hasty knife work, many workers were injured on the job – losing fingers, or worse!
In one of the saddest and most well publicized disasters of the early 20th Century, a group of approximately 150 immigrant laborers were trapped – literally locked in by their employers – in a burning building in New York City. Changes to fire codes and improvements to the working conditions were soon passed to protect employees and factory workers.
America’s first major labor union, this group accepted both skilled and unskilled employees and protested low wages and unsafe conditions at public rallies. In 1886, at a meeting against the McCormick Harvesting Company in Chicago, IL, an anarchist threw a bomb into the crowd killing several police officers and protesters. The Knight reputation soon declined – blame by association.
When Andrew Carnegie attempted to slash his workers wages, they walked out on strike. When he hired strikebreakers, or “scabs” to replace them, they fought violently to prevent the mills from re-opening. Eventually, the Pennsylvania State Militia forced and end to the conflict using violent force of their own.
“Mother” Jones was one of the many women involved with supporting labor unions. She was especially interested in the plight of working children – fighting for child labor laws – but also very much involved with supporting strikers and leading protest rallies.
When workers at George Pullman’s sleeping and dining car companies went on strike to protest a wage cut, Eugene V. Debs of the American Railroad Workers Union directed him men not to load or unload any train with a Pullman car attached – the result was deadlock, then intervention by the President, Grover Cleveland.
Describing themselves as “One Big Union” and engaging in singing and public demonstrations as well as outright violent acts, this union was feared for its radical and ideological agenda – they fought for higher wages and safer working conditions.
Joe Hill, the songwriter and protester who lead dozens of strikes in the miner’s camps of the West, was eventually convicted of a murder which took place at one of the protesters sites. He was put to death in Utah during the 1910s.
“Big Bill” Haywood was a founding member of the Industrial Workers of the World and a member of the Socialist Party of the United States. Because he preferred direct action – read: violence – instead of political maneuvering, he was frequently in conflict with the Socialists (who preferred political demonstrations) and the owners of companies (who preferred to make more money!). He played a key role in both the Colorado Labor Wars of the 1910s and the Lawrence Textile Strike of 1912 in Massachusetts. After being accused of murdering the Governor of Idaho – and acquitted – Haywood eventually emigrated from the United States and became a resident of the Soviet Union.