Aim: Economic Changes & Developments Do-Now : Do you like the game Monopoly? Why/Why not? Do-Now : Do you like the game Monopoly? Why/Why not?

Post-Civil War Economy War Stimulated North’s economy and destroyed the south’s

Key Economic issues North -Continued rapid development, new interest in overseas -Crucial to economy, Transcont.- develops west -Farms began to mechanize to increase production- Urban Areas North -Continued rapid development, new interest in overseas -Crucial to economy, Transcont.- develops west -Farms began to mechanize to increase production- Urban Areas Industries Railroads Land Use & Ag. South - Began slow, (textile & Steel), Urban areas needed much work -Destroyed, needed building, roads & bridges too - Slave based plant. system ends, land destroyed, poor whites & blacks compete. (sharecropping & tenant farming)

Growth of Corporations  New Technology & Business expansion lead to corporations. Why?  Corporation- A business where many investors own shares/stocks. Investors Then receive a dividend -Benefits of losses with failed business -Speeds up industry growth  New Technology & Business expansion lead to corporations. Why?  Corporation- A business where many investors own shares/stocks. Investors Then receive a dividend -Benefits of losses with failed business -Speeds up industry growth

Other forms of organizations  Monopoly- A company or small group of companies that has complete control over a particular field of business (ex. Pizza chain)  Some monopolies are okay  Conglomerate- A corporation that owns a group of unrelated companies(clearchannel & GE)  Monopoly- A company or small group of companies that has complete control over a particular field of business (ex. Pizza chain)  Some monopolies are okay  Conglomerate- A corporation that owns a group of unrelated companies(clearchannel & GE)

Continued  Merger- Process by which one company aquires legal control of another  Pools- When Companies work together to fix prices. (RR’s 1800s)  Trusts- When a group of corporation is controlled by board. Shareholders lose say in company. - Limit competition  Trusts and pools were outlawed.  Holding company- Get around Trusts. Buys company’s stock rather than direct take over  Merger- Process by which one company aquires legal control of another  Pools- When Companies work together to fix prices. (RR’s 1800s)  Trusts- When a group of corporation is controlled by board. Shareholders lose say in company. - Limit competition  Trusts and pools were outlawed.  Holding company- Get around Trusts. Buys company’s stock rather than direct take over

Innovation & Entrepreneurs  Rural Areas- Mail order Catalogs. Spread products (vacuum, light bulb, telephone, electric iron)  Department stores- Variety under one roof.  Rural Areas- Mail order Catalogs. Spread products (vacuum, light bulb, telephone, electric iron)  Department stores- Variety under one roof.

Entrepreneurs  People who take responsibility for the organization and operation of a new business venture.  Risk large sums of $ to make great profits.  People who take responsibility for the organization and operation of a new business venture.  Risk large sums of $ to make great profits.

Entrepreneurs  Andrew Carnegie- Originally bad investor. Sought to control all aspects of steelmaking.  Became worlds largest steelmaker  Sold for 1/4 bil.  Duty to society- $ to charity and built free public libraries.  Andrew Carnegie- Originally bad investor. Sought to control all aspects of steelmaking.  Became worlds largest steelmaker  Sold for 1/4 bil.  Duty to society- $ to charity and built free public libraries.

Entrepreneurs  John D. Rockefeller  Standard Oil controlled over 90% of U.S. oil refining  Standard Oil Trust Why?  Believed competition was wasteful  Donated to charity  John D. Rockefeller  Standard Oil controlled over 90% of U.S. oil refining  Standard Oil Trust Why?  Believed competition was wasteful  Donated to charity

Entrepreneurs  J. Pierpont Morgan  Banker- Made loans to new businesses.  Took control of bankrupt railroads, reorganized and made profits  Bought Carnegie Steel in 1901, created U.S. Steel corporation world’s largest.  J. Pierpont Morgan  Banker- Made loans to new businesses.  Took control of bankrupt railroads, reorganized and made profits  Bought Carnegie Steel in 1901, created U.S. Steel corporation world’s largest.

Henry Ford  Assembly Line  Lowered Cost of Production  Sped up rate of production  Paid Workers Higher Wages- Set standard  Assembly Line  Lowered Cost of Production  Sped up rate of production  Paid Workers Higher Wages- Set standard

Old School Thought of Business  Puritan work ethic?  Poor boys become rich through hard work and luck  If not??  Puritan work ethic?  Poor boys become rich through hard work and luck  If not??

Late 1800’s  Rethinking Business Mentality  Due to cut-throat business tactics  Rethinking Business Mentality  Due to cut-throat business tactics

New Philosophies  Laissez Faire (Lazy Fair)  Free Enterprise System- Up to the individual  Laissez Faire (Lazy Fair)  Free Enterprise System- Up to the individual

Social Darwinism  Businesses live or die by natural selection  Weak Businesses fail -Healthy survive  Businesses live or die by natural selection  Weak Businesses fail -Healthy survive What would Government interference do? Interfere with Natural selection

Robber Barons or Philanthropists?  Growing gulf between rich and poor  Robber Barons- Those who gained their wealth by ruthless methods in their dealings with competitors at the expense of the poor and working class  What do you think?  Growing gulf between rich and poor  Robber Barons- Those who gained their wealth by ruthless methods in their dealings with competitors at the expense of the poor and working class  What do you think?

“Gilded Age”  Rich spend freely showing off their wealth  What is this called?  Conspicuous Consumption  Rich spend freely showing off their wealth  What is this called?  Conspicuous Consumption

Government Policies Toward Business  Generally - Laissez Faire  Expansion and growth justified it  Business leaders make financial contributions  Loans & land grants aid expansion, high foreign tariffs  Generally - Laissez Faire  Expansion and growth justified it  Business leaders make financial contributions  Loans & land grants aid expansion, high foreign tariffs

Steps Toward Regulation  - Periodic economic downturns -Growing Criticism of practices -Increasing political presusre for change -Limited impact of government, but set the course for future.  - Periodic economic downturns -Growing Criticism of practices -Increasing political presusre for change -Limited impact of government, but set the course for future.

Railroad Problem  Due to greedy railroad owners, some states passed regulation laws  Railroads sued to have them overturned  Due to greedy railroad owners, some states passed regulation laws  Railroads sued to have them overturned

Munn v. Illinois  States could regulate railroad  States had power to police private property “affected with a public interest”  Question of interstate?  Overturned by Wabash case saying only Fed. Government could regulate interstate trade  States could regulate railroad  States had power to police private property “affected with a public interest”  Question of interstate?  Overturned by Wabash case saying only Fed. Government could regulate interstate trade

Interstate Commerce Commission  Interstate Commerce  Set Precedent  Interstate Commerce  Set Precedent

Sherman Antitrust Act  1890 Any business combination/trust is illegal if it is “in restraint of trade or commerce”  U.S. v. E.C. Knight Co Many Businesses exempt.  Holding Companies  Precedent Set  1890 Any business combination/trust is illegal if it is “in restraint of trade or commerce”  U.S. v. E.C. Knight Co Many Businesses exempt.  Holding Companies  Precedent Set

“Eight Hours For Work, Eight Hours for Sleep, Eight Hours for What we will”  Cooperation & Association- Labor Unions  Collective Bargaining?  Benefits? Individual vs. Group  Cooperation & Association- Labor Unions  Collective Bargaining?  Benefits? Individual vs. Group

Knights of Labor  Terrence Powderly  Broad Reforms- Child Labor, Workday, Women  Terrence Powderly  Broad Reforms- Child Labor, Workday, Women

AFL  specific, immediate goals- hours, working conditions, wages  Bread-and-butter unionism  Samuel Gompers  NO- Women, immigrants, African Americans  specific, immediate goals- hours, working conditions, wages  Bread-and-butter unionism  Samuel Gompers  NO- Women, immigrants, African Americans

International Ladies’ Garment Workers Union  Represents laborers in sweatshops

Triangle Shirtwaist Company  New York City- March 1911  150- Young Immigrant women  New York City- March 1911  150- Young Immigrant women

Labor Conflicts  Great Railway Strike  Haymarket Riot  Homestead Strike  Pullman Strike  Lawerence Textile Strike  Great Railway Strike  Haymarket Riot  Homestead Strike  Pullman Strike  Lawerence Textile Strike

Haymarket Riot  Influenced Anti-Labor Feeling  Knights Decline- AFL, Public blame  Bomb- 7 P.O.’s, Civilians  Influenced Anti-Labor Feeling  Knights Decline- AFL, Public blame  Bomb- 7 P.O.’s, Civilians

Great Railway Strike  Pay cuts for railway workers  President Hayes- Federal Troops  No real benefits- Owners Tougher  Pay cuts for railway workers  President Hayes- Federal Troops  No real benefits- Owners Tougher

Homestead Strike  Homestead, Penn. Carnegie Steel Plant- Wage Cut  Security Guards to protect plant- 16 people killed- National Guard  Less than 25% Get jobs back  Stops Union Movement  Homestead, Penn. Carnegie Steel Plant- Wage Cut  Security Guards to protect plant- 16 people killed- National Guard  Less than 25% Get jobs back  Stops Union Movement

Pullman Strike  Illinois strike- Stopped other railways  President Grover Cleveland- Federal troops  Government- Business over labor  Why?  Sooner Than expected  Illinois strike- Stopped other railways  President Grover Cleveland- Federal troops  Government- Business over labor  Why?  Sooner Than expected

Transcontinental Railroad

Lawrence Textile Strike  IWW- Industrial Workers of the World  Textile mills, Lawrence, MA.  Law shortening work week- Lowers wages  Workers win demands (overtime, 15%, no strike repercussions)  Women, immigrants, children, can unite  IWW- Industrial Workers of the World  Textile mills, Lawrence, MA.  Law shortening work week- Lowers wages  Workers win demands (overtime, 15%, no strike repercussions)  Women, immigrants, children, can unite

Timeline  Create a timeline- From change of business mindset to strikes and government action  Why is this significant?  Create a timeline- From change of business mindset to strikes and government action  Why is this significant?

The Great Plains?  Climate?  Land?  Economy?  Climate?  Land?  Economy?