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The Rise of “Big Business”

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1 The Rise of “Big Business” 1870-1900
What led to the growth of corporations and monopolies in the late 19th century? Who were major industrialists during this period? How did these businesses affect American economics, politics, and social relationships?

2 The Gild The Boldt Castle The Astor Family
Breakers of the Vanderbilt Family The Mount of Edith Wharton Lockwood-Mathews Mansion

3 “Big Business” Monopolies (trusts): Companies that controlled the majority of one industry: Rockefeller’s Standard Oil Carnegie’s U.S. Steel Vanderbilt’s railroads Trusts -A group of separate companies placed under the control of a single managing board Critics called these practices unfair and the business leaders “Robber Barons”

4 Rationalizing Big Business
Social Darwinism Used Darwin’s theory to explain business, promoted by Harvard professor William Graham Sumner Natural Selection, Survival of the Fittest Laissez-faire -policy that US had followed since inception to not allow govt. to interfere with business Govt. should not interfere Sherman Anti-Trust Act of 1890 Law outlawing a combination of companies that restrained interstate trade or commerce; important to prevent monopolies. Not initially enforced properly. Gospel of Wealth -belief that the wealthy are “chosen by God” to be successful and were therefore responsible to look out for the well being of those less fortunate. Many Industrialist shared wealth although rarely through direct welfare. Started museums, etc. Captains of Industry: a positive idea that industrial leaders worked hard and deserved their wealth

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6 Andrew Carnegie A Scottish immigrant, Andrew Carnegie helped build the American steel industry—Carnegie Steel Co. (originally started as an ironworks foundry) 1900 Carnegie Steel produced more of the metal than all of Great Britain Richest man in the world at the time One of the first philanthropists, gave his collected fortune away to cultural, educational and scientific institutions for "the improvement of mankind." (Gospel of Wealth) Carnegie Hall, NYC Carnegie-Mellon University Over 2,500 public libraries $350 million by the time he died Carnegie was unusual because he preached for the rights of laborers to unionize and to protect their jobs. However, Carnegie's steel workers were often pushed to long hours and low wages-- Homestead Strike of 1892

7 Building a monopoly (as described by Andrew Carnegie)
Vertical Integration A process in which a company buys out all of the suppliers. (Ex. coal and iron mines, ore freighters, RR lines) Horizontal Consolidation -A process in which a company buys out or merges with all competing companies (JP Morgan bought out Carnegie steel and other companies)

8 The Steel Industry’s Impact on America
Bessemer Process- developed around 1850 injected air into molten iron to remove impurities and make steel-a lighter, more flexible, rust resistant metal Steel is used in railroads, farm equipment, canned goods Engineers use steel to create skyscrapers and longer bridges (Brooklyn Bridge) View Steel Industry Video

9 J.P. Morgan Industrialist and financier who started U.S. Steel from Carnegie Steel and other companies Became 1st billion- dollar corporation Bailed out the U.S. economy on more than one occasion

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11 John D. Rockefeller He was a co-founder of the Standard Oil Company, which dominated the oil industry and was the first great U.S. business trust As kerosene and gasoline grew in importance, became the world's richest man and the first American worth more than a billion dollars Often cited as the richest person in history Like Carnegie, was a philanthropist under the Gospel of Wealth: An abolitionist Creator of Spelman College Major donator to the University of Chicago and other major medical universities Owned a large portion of real estate in Manhattan, NYC

12 Cornelius (“The Commodore”) and W.H. Vanderbilt
Originally a steamboat entrepreneur, C. Vanderbilt became a railroad magnate Initially did not think his son was fit for the job W.H. became president of Central and Hudson River Railroad, Lake Shore and Michigan Southern Railway, the Canada Southern Railway, and the Michigan Central Railroad An active philanthropist, giving extensively to a number of philanthropic causes: Funded the Metropolitan Opera Funded College of Physicians and Surgeons at Columbia University. In 1880, he provided the money for Vanderbilt University in Nashville, Tennessee

13 "The Great Race for the Western Stakes, 1870," Cornelius Vanderbilt versus James Fisk

14 Thomas Edison (“The Wizard of Menlo Park”)
An American inventor and businessman. He developed many devices that greatly influenced life around the world, including: Phonograph motion picture camera Long-lasting electric light bulb. one of the first inventors to apply the principles of mass production and large-scale teamwork to the process of invention, and because of that, he is often credited with the creation of the first industrial research laboratory. One of the first to apply the mass production and large-scale teamwork to the process of invention Created the first industrial research laboratory Later electrical genius Nicola Tesla worked for Edison and is (unofficially) credited with many of his inventions 1,093 US patents in his name Inventions established major new industries world-wide: electric light/power, power utilities sound recording, motion pictures Telecommunications: stock ticker, mechanical vote recorder, battery for an electric car, recorded music device

15 Videos The Gilded Age “Traits of a Titan” from the History Channel’s The Men Who Built America Captains of Industry (biography.com)


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