Agenda Do Now “The Growth of Big Business” Notes Robber Barons or Captains of Industry?  Computer Lab Homework:  Finish Robber Barons vs. Captains of Industry

Do Now: Do billionaires have a responsibility to help the poor?  Do millionaires?

The Growth of Big Businesses American History November 21, 2014

Who are the billionaires (Robber Barons) of today?

Forbes 2014 RankNameWorthAgeSourceCountry 1Bill Gates$82.2B59MicrosoftUSA 2Carlos Slim Helu & Family$79.9B74TelecomMexico 3Warren Buffett$71.4B84Berkshire HathawayUSA 4Amancio Ortega$60.2B78Zara (Retail)Spain 5Larry Elliston$51.3B70OracleUSA 6Charles Koch$43.2B79EntrepreneurUSA 7David Koch$43.2B74EntrepreneurUSA 8Christy Walton & Family$40.9B59Wal-MartUSA 9Jim Walton$39.8B66Wal-MartUSA 10Alice Walton$38.4B65Wal-MartUSA

Social Darwinism Society should do as little possible to interfere with people’s pursuit of success  Process of natural selection  Applies to businesses “Fit” business would succeed and become rich Society as a whole will benefit from the success of the fit and the weeding out of the unfit  Governments neither taxed profits nor regulated their relations with workers or consumers

Business on a Larger Scale Larger pools of capital Wider geographic span Broader range of operations Revised role of ownership New methods of management

New Market Structures Oligopoly  an industry dominated by only a few large, profitable firms Monopoly  complete control of a product or service Cartel  loose association of businesses that make the same product

Horizontal and Vertical Consolidation Horizontal Consolidation  “merger” – when one corporation bought out the stock of another  “Monopoly”  Rockefeller Standard Oil Company Vertical Consolidation  “trusts” – when one corporation controls every aspect of production  Carnegie Steel Company

Response of the Gov’t Americans demanded the break up of industrial giants  Government officials didn’t want to interfere with the “captains of industry” Sherman Antitrust Act  outlaws any combination of companies that restrained interstate trade or commerce  Vague wording supported big businesses

Robber Barons vs. Captains of Industry “Robber Barons”“Captains of Industry” Business leaders built their fortunes by stealing from the public They drained the country of its natural resources They persuaded public officials to interpret laws in their favor They ruthlessly drove their competitors to ruin They paid their workers meager wages and forced them to toil under dangerous and unhealthy conditions The business leaders served their nation in a positive way They increased the supply of goods by building factories They raised productivity and expanded markets They created jobs that enabled many Americans to buy new goods and raise their standard of living They also created museums, libraries, and universities, many of which still serve the public today

Robber Barons vs. Captains of Industry? John D. Rockefeller Andrew Carnegie JP Morgan Cornelius Vanderbilt

Agenda Do Now Labor Unions & Homestead Strike “10 Days That Unexpectedly Changed History: Homestead Strike” Video Homework:  Complete video questions (In completion on a separate sheet of paper)

Do Now Are Unions necessary in big businesses? Why/why not?

Labor Unions Grew out of the need to protect common interests of workers  Better wages  Reasonable hours  Safer working conditions  Health benefits  Aid to workers who were injured

Homestead Strike Homestead, PA – Carnegie’s factory Reduced wages at his steel mills  Union refused to accept the cut Carnegie Steel locked union workers out  Hired replacement workers or “scabs”  Hired “Pinkertons” – armed guards