big business vs. labor corresponds with chapter 14, section 3
TRANSCRIPT
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Big Businessvs.
Labor
Corresponds with Chapter 14, section 3
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Main Idea and Key Terms
• Andrew Carnegie• Vertical and
Horizontal integration
• Social darwinism• John D. Rockefeller• Sherman Anti-Trust
Act
• Samuel Gompers• American Federation
of Labor (AFL)• Eugene V. Debs• Industrial Workers of
the World (IWW)• Mary Harris Jones
•The expansion of industry resulted I the growth of big business and prompted laborers to form unions to better their lives. Can be found on Page 447
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Create a Graphic Organizer!
Andrew Carnegie J.D. Rockefeller
– Origin?
– Major Industry?
– Interesting Fact
– Major Industry?
– Origin?
– Interesting Fact
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Andrew Carnegie
• Bio:– Born in Scotland to poor parents– Came to the United States in 1848– He was 12 years old– Within 6 years he was the private secretary of the local superintendent of the Pennsylvania Railroad
– Rich enough by 1865 to quit
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Carnegie continued
• Bio continued:– In 1873, Carnegie invests in his own steel company
– By 1899 Carnegie Steel is producing more steel than every factory in England
– How did he do this?
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Integration
AND Vertical Integration
Horizontal Integration
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Vertical Integration
• Moves up and down the ladder, meaning you buy the previous step, and next step of your business.
• If you own a steel company, you buy the mining companies to get resources for you cheaper, and buy the railroads to ship the finished products out later
Horizontal Integration
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Horizontal Integration
• Horizontal Integration is another way to cut costs and increase profits
• H.I. involves buying out everyone who is direct competition with you.
• i.e. Carnegie buying out every other steel company in competition with him
Vertical Integration
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Social Darwinism
• The theory of Social Darwinism grows out of the theory of evolution
• Means that the more fit in society will advance, weeding out the less able
• Used to support “Laissez Faire” which means “allow to do” in French
• Appealed to the Protestant work ethic
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Consolidation
• Many industrialists tried to eliminate competition by creating holding companies to buy out other companies’ stock
• Others created Trusts
• What is a trust?– Ask John D. Rockefeller…
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John D. Rockefeller
• Bio:– Born in 1839 in Richmond, N.Y.– Started a small business– Sold that business and invested in a new venture…
– Standard Oil
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• Bio continued:– In 1870, Standard Oil controlled 2-3% of the U.S. crude oil
– By 1880, Standard Oil controlled over 90% of the U.S. crude oil
– Did this through selling below cost to run competitors out of business, and then raised prices higher than normal
– Paid extremely low wages
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The Robber Barons
• Carnegie, Rockefeller, and others became known as the “Robber Barons”
• Take from the poor, give to the rich…well…at least themselves
• But were they all bad?
• Rockefeller did give away a small portion of his wealth…something to the tune of $500 million
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What is a “Trust”
…an illegal combination of industrial or commercial companies in which the stock of the constituent companies is controlled by a central board of trustees, thus making it possible to manage the companies so as to minimize production costs, control prices, eliminate competition, etc.
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Sherman Anti-Trust Act
• The Sherman Anti-Trust Act is designed to make trusts illegal which interfered in interstate commerce
• It is ineffective for reasons as simple as not supplying a definition of the word “trust”
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Labor Unions
• Labor Unions emerge to protect workers from long hours, low wages, and unsafe conditions
• Different Unions Emerge
• Read “Labor Unions Emerge”, “Union Movements Diverge”, and “Strikes turn Violent” for homework
• These are on pages 450-455