Warm-Up Questions 1.) Who owned the Standard Oil Company? a.) Carnegieb.) J.P. Morganc.) Westinghoused.) John D. Rockefeller 2.) Which of the following choices best describes this diagram? CattleSlaughterhouseMeat Packing PlantsAce Meat Industries a.) Horizontal integrationb.) Vertical Integration c.) Trust Companyd.) Holding Company 3.) Workers who tried to organize a union or strike were often fired and placed on a list of “troublemakers” called the a.) Blacklistb.) Lockout listc.) Strikebreaker listd.) Union list 4.) What is the definition of Monopoly? a.) An oil companyb.) A steel company c.) Complete control of an industryd.) business that is created quickly 5.) Which of the following best describes why Mark Twain referred to the era of industrial expansion as the “Gilded Age”? a.) The glittering surface of the wealthy lifestyle concealed corruption and greed b.) The wealthy class inherited money rather than working to earn it c.) Wealthy Americans tried to influence national politics d.) Many people made fortunes in the California Gold Rush

Problems, Problems, Problems Objective 5.2: Explain how business & industrial leaders accumulated great wealth & wielded political & economic power Objective 5.3: Describe the changing role of government in economic & political affairs

Corrupt Government Many people saw government jobs as a means of wealth Graft – A form of corruption when one uses political authority for personal gain Kickbacks - A form of negotiated bribery in which money is paid to the bribe-taker as an agreement between the two and is usually intended to encourage them to cooperate in an illegal scheme. It “kicks back" a portion of the illegal gain in order for their assistance in obtaining it Fraud – An intentional deception made for personal gain or to damage another individual

Political Machines When a person, small group, or political party can come to dominate an area by commanding enough support through rewards to maintain political power Used patronage, loyalty, and graft The public allowed this system to take place because most cities lacked particular services that machines could supply and it helped the poor in exchange for their voting allegiance The machine was often controlled by one boss, who controlled many jobs, services, and funds.

Tweed Ring Headed by William “Boss” Tweed Controlled New York City Tammany Hall ring was a political machine full of graft and corruption Eventually exposed by political cartoonist Thomas Nast

Other Scandals Credit Mobilier –Union Pacific hires Crédit Mobilier to build its railroad. –Union Pacific tells the governmemt that it will cost $100 million to build, when it actually costs about $50 million –Essentially they were billing the government twice for work done once –Since Union Pacific and Crédit Mobilier are owned by the same people, the extra $50 million is pocketed by the owners –These companies also gave shares of stock to politicians in federal government to ensure they kept getting subsidies. –Local or state politicians were given free passes to keep their loyalty Whiskey Ring Scandal –A group of mostly Republican politicians were able to siphon off millions of dollars in federal taxes on liquor; the scheme involved an extensive network of bribes involving distillers, rectifiers, gaugers, storekeepers, and internal revenue agents. Lobbyists held great influence over Congress for the large trusts

Civil Service Reform Unqualified people in positions Rutherford B. Hayes campaigns for political reform Urges the elimination of spoils system and establishment of merit system, where you hire the people best fit to perform the job regardless of their political affiliations or connections

The Presidents Hayes is elected, leads reform efforts James Garfield is elected, continues reforms Garfield assassinated Vice-President Chester Arthur becomes President

Pendleton Act Pendelton Act passes –A federal law that stipulated that government jobs should be awarded on the basis of merit. The act made the selection of government employees based on competitive exams, rather than ties to politicians or political affiliation. It also made it illegal to fire or demote government employees for political reasons and prohibits soliciting campaign donations on Federal government property. Mugwumps –A group of Republican activists who supported Democratic candidate Grover Cleveland in the United States presidential election of 1884.

Tariffs Grover Cleveland elected in 1884 Benjamin Harrison elected in 1888 Grover Cleveland elected again in 1892 Tariffs and reforms are major issues Tariff reforms fail as McKinley Tariff passes, which raised the average duty on imports to almost fifty percent and was the highest tariff yet

Assignment “Problems, Problems, Problems” Worksheet Vocabulary Words – Pendleton Act – Political Machines – Whiskey Ring – William Tweed – Tammany Hall – Credit Mobilier