The Business of Business is Business Monopolies and Robber barons

Objective Explain the events of the Civil War, Reconstruction, the African-American racism struggle, and the various inventions and big business of the late 19th and early 20th century

Guided Note Questions copy these into your notes What was the age after the Civil War called and why? What is the fear of monopoly to our capitalist system? Explain ways in which a business can become “big”. What is the difference between a captain of industry and a robber baron? What were the justifications for the wealth that these men accumulated? Each question should be at least 1 to 3 sentences and use direct information from the lesson

“The Gilded Age” era after Civil War / Reconstruction a phrase coined by Mark Twain it was an era of enormous growth, wealth, opportunity, innovation, etc. however, it was also an era political corruption, scandals, greed, child labor, materialism, racial discrimination, etc. so it was “gilded” = bright and shiny on the outside, but just ordinary or even nasty on the inside (Or think of a beautiful, shiny, red apple… that is rotten on the inside) Guided Question 1: What was the age after the Civil War called and why?

“Big Business” as America industrialized, there became a new wealthy elite that ran these industries an important aspect of America’s capitalist economic system is the belief that the nation’s economy is strongest when there is true competition between businesses as these businesses grew, they started to become very large and… generally the problem with “Big Business” over the years has been the fear of Monopoly: “complete control over an industry’s production, wages, and prices”

“Big Business” monopolies are bad in a capitalist economy because you want competition to drive down prices for consumers however, too many laws, tariffs, and regulation can choke business and cause other problems therefore it is up to the government to ensure that monopolies do not exist, but not interfere too much into the economy Guided Question 2: What is the fear of monopoly to our capitalist system?

How does a Business get “Big?” “Mergers” “Trusts” consolidating business with a stock Market buyout of another business sometimes, intimidation or shady business tactics would be used to try and ruin the business of a private company sometimes Mergers are executed by “Holding Companies” –a company whose sole purpose is to purchase stock in other companies consolidating business by having participating companies turn their stock over to a group of “trustees” (people who ran the separate companies as one large corporation) each company would then split the profits made by the entire Trust

How does a Business get “Big?” Business owners should consolidate as much as possible in order to control their costs of production to make more profit. Two ways to do this: vertical integration: buying out suppliers, shipping, and distribution in order to control all facets of a business horizontal Integration: consolidation of companies that produce similar products paying employees extremely low wages; Dangerous conditions driving competitors out of business by selling at a lower price than it costs to produce. after control of the market is achieved, hiking prices up above original levels Guided Question 3: Explain the ways in which a business can become “big.”

The Men Who Profited there were several men who used this new era of business to become powerful and wealthy including: John D. Rockefeller – Oil industry Andrew Carnegie – Steel industry Cornelius Vanderbilt – Shipping industry J.P. Morgan – Financial industry Jay Gould – Railroad industry

How wealthy were the these men compared to Microsoft founder Bill Gates?

“Boss Tweed” and the Tweed Ring Scandal William Marcy Tweed was known as “Boss Tweed” head of Tammany Hall, which was the democratic political machine that dominated New York City in the late 19th century ran the Tweed Ring, which was a group of corrupt politicians between 1869 and 1879, the Tweed Ring pocketed approximately $200,000,000 from New York City Thomas Nast, a political cartoonist, took on the Tweed Ring with his political cartoons

Thomas Nast Political Cartoon

Thomas Nast Political Cartoons

Boss Tweed and the New York Machine Tweed Video (9:18) http://www.youtube.com/watch?v=YildL_ilQFY

Robber Barons or Captains of Industry? Captain Of Industry Robber Baron exploited workers corrupted the government greedy created Jobs increased production provided cheap products gave money back to the community Guided Question 4: What is the difference between a captain of industry and a robber baron?

Justification for the Industrialists’ Wealth Social Darwinism Gospel of Wealth Herbert Spencer based on Charles Darwin’s theory of evolution those who are rich are more fit, than those who are poor attempted to use science to explain social classes Andrew Carnegie God gave wealth to the most capable people It is the duty of the wealthy to give money to help the poor Carnegie gave millions of dollars away to establish libraries, colleges, and museums (Carnegie Hall in NY) Guided Question 5: What were the justifications for the wealth that these men accumulated?

Big Business and Labor Working Conditions Workers Exploited prior to industrial era, most employers were small shops and companies big business, led by people like Carnegie and Rockefeller paved the way for huge companies, which required more labor to run

Child Labor

Child Labor

“Galley Labor”

Big Business and Labor Working Conditions Long Hours seamstresses worked 12+ hours a day, six days a week steel mill workers worked seven days a week workers had no amenities (vacation, sick leave, unemployment, compensation or reimbursement for injuries suffered on the job) injuries were common if you were injured on the job, you were fired workers worked in unhealthy conditions worked 12 to 14 hours a day for $12.00 a week, which was four cents an hour

Big Business and Labor Working Conditions Women and Children sweatshop conditions were horrible wages were so low everyone had to hold a job to survive– entire families needed to work 1890 – 4,000,000 working women 1910 – 8,000,000 working women 20% of boys and 10% of girls under age 15 (some as young as five years old worked full time) children worked from dawn to dusk children were hungry, exhausted, prone to crippling accidents, and forfeiting of school they worked tedious jobs that paid low wages. this work was no not meaningful there was no job satisfaction

Triangle Shirtwaist Company women were banned from many unions; however, they united behind powerful leaders to demand better working conditions the public could no longer ignore conditions in garment factories after a fire broke out in New York City Video (9:18) http://www.youtube.com/watch?v=vus4b8FRTKM

Answer should be three (3) sentences Essential Question In your opinion, should the United States government become involved in business if a monopoly could be created? Why or why not? Answer should be three (3) sentences

Objective Explain the events of the Civil War, Reconstruction, the African-American racism struggle, and the various inventions and big business of the late 19th and early 20th century