1. Railroad and Big Business
Transcontinental Railroad
George Pullman
Interstate Commerce Act
Andrew Carnegie
Social Darwinism
John D. Rockefeller
Sherman Anti-Trust Act

2. Transcontinental RR Linked the coast by rail in 1869
Other lines followed
1890: 180,000 miles of track
Towns grew and died because of the rr

3. George Pullman 1880: Built a sleeper car Created a “company town”
Pullman , IL
Provided for the basic needs
Company controlled the town
No alcohol
Depression in 1890s led Pullman to cut wages
Didn’t cut prices in town

4. RR cont. Farmers wanted gov’t oversight of rr companies Granger Laws
Companies were corrupt
Wanted farmers kept poor
Price fixing
Granger Laws
Laws sponsored by the Grange
Regulated rr companies

5. More rr RR companies challenged laws in court
Supreme Court found the laws to be constitutional
It is okay for the gov’t to regulate private industry for the good of the public

6. Interstate Commerce Act
1887
Established the right of the Feds. to supervise rr activities and establish an interstate commerce commission
ICC was ineffective until Theodore Roosevelt

7. Andrew Carnegie Former rr mogul Made production cheaper
Moved to producing steel in 1873
Carnegie Steel Company
Made production cheaper

8. Vertical Integration Carnegie bought out supplier and shippers
He controlled everything from mining to production to delivery

9. Horizontal Integration
Buy out competition
By 1901 Carnegie controlled most of the steel industry in the U.S.
Both processes allowed Carnegie to control costs

10. Social Darwinism Based on Charles Darwin’s theory of evolution
“Natural Selection” weeded out the unsuccessful
This allowed for monopolies to be created
Social Darwinism said that the riches were a reward from God and the poor were lazy and deserved what they got

11. John D. Rockefeller Standard Oil Company
Joined into a trust with many other companies
Board of directors controlled those companies
Smaller companies were able to earn $$ from the larger trust
Rockefeller was able to control the entire oil industry

12. John D. Rockefeller

13. J.D.R. cont.
1880: Rockefeller controlled 90% of the refineries in U.S.
Paid low wages
Drove competition out of business
Sold oil at a below market price
Killed his competition
After comp. was gone he hiked oil prices up
“Robber Barons”

14. Not All Bad Rockefeller and Carnegie were also philanthropists
R. gave $500 million to Univ. of Chicago
Carnegie donated 90% of his wealth

15. Sherman Anti-Trust Act
Illegal to form a trust that interfered with free trade between states or with other countries
Tried to stop monopolies
Vocabulary of “trust” was hard to prove
Consolidation of businesses continued