railroad corruption
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Warm Up: Identify a company that you think has unfair practices (to either its workers or customers). Explain why they are able to be unfair and how this should be changed. . Railroad Corruption. The worst case was the Crédit Mobilier - PowerPoint PPT PresentationTRANSCRIPT
Warm Up:
Identify a company that you think has unfair practices (to either its workers or customers).
Explain why they are able to be unfair and how this should be changed.
Railroad Corruption
• The worst case was the Crédit Mobilier• Jay Gould boomed and busted railroad stock,
making profit for himself all the way along. • “Stock Watering" where railroads would
artificially talk up the companystock would increase.
Railroad Corruption
• “Pools:" competitors agreed to cooperate as if they were one company.
• Rebates were given to large companies that shipped large quantities of goods.
Interstate Commerce Act/Commission (1887)
• Outlawed Rebates and Pools
Vertical Integration
• Ex. Sears, Roebuck and Company
Horizontal Integration
Andrew Carnegie• Son of Scottish
immigrantsclassic rags-to-riches story. – Carnegie entered the steel
industry. – Carnegie's U.S. Steel Corp.
• U.S. Steel produced 1/4 of the nation's Bessemer steel.
• Carnegie made $25 million, tax free.
• Gospel of Wealth: rich had a moral duty to spread the wealth
John Rockefeller • Standard Oil Company • Used vertical integration • Controlled 90-95% of the
oil in the U.S. • “Let us prey" (on the little
companies). • Interlocking directorates
own men would be placed on the board-of-directors for "competitors.".
J.P Morgan
• Banker/Financer • Insider Trading• Disregarded Workers• Gold Speculation• J.P. Morgan bought
Carnegie Steel and built U.S. Steel into the world's first billion dollar company ($1.4 billion).
Cornelius Vanderbilt
• Railroads and Shipping
• Built Grand Central Station
• Gave money for Vanderbilt University
Sherman Anti-Trust Act
• Enacted in attempt to outlaw trusts or monopolies.– Effected Labor Unions– Didn’t become as effective until 1914
Formation of Labor Unions
• Low Wages• Unsafe Conditions• Long Hours• Management lack of concern for workers– Unions formedoften got entangled in violent
strikes
Knights of Labor
• skilled and unskilled, women and blacksonly banned "non producers"
• The Knights sought workers' cooperatives, better working conditions, and the 8 hour workday.
• Got 8 hour day in several places• BUT the Haymarket Square Incident damaged
them.
American Federation of Labor
• The AF of L was made up of skilled craftsmen, made up of small, independent unions.