When Monopoly Wasn’t A Game…..The Rise of Big Business in America

New Business Culture and New Business Opportunities due to:

1. Unskilled & semi-skilled labor in abundance.2. Abundant capital.3. New, talented group of businessmen (entrepreneurs)

and advisors.4. Market growing as American population increased.5. Government willing to help at all levels to stimulate

economic growth.6. Abundant natural resources.7. Technological advances and the growth of industry.

Laissez- faire Capitalism = “Let people do as they choose”Individuals should compete freely in the

marketplace.The market was not man-made or invented.

but instead follows natural laws.No room for government in the market! =

“Hands Off!”An extension of Darwin’s “The Origin of the

Species”=

Herbert Spencer

Social Darwinism = Society progressed through natural

competitionThe “fittest” would achieve great wealthThe “unfit” would failIndividuals must have absolute freedom

to struggle, succeed or fail. Therefore, state intervention to reward

society and the economy is futile!

The CORPORATION

Stocks =

Stockholders =

Dividends =

Trust =

Monopoly =

Certificates of ownership in a company, sold as SHARES.

People who buy stocks

Percentage of the corporation’s profitsthat shareholders receive, usually quarterly

A group of companies who turn control of their stock over to a common board of trustees.

When a trust gains exclusive control of an industry.

Advantages and Disadvantages of Corporations??

Positives + Negatives ---

1. Quick way to makemoney

2. Limited liabilityfor investors

3. Stability because the corporation is not

dependent on any one individual(Corporation exits nomatter who owns thestock)

1. Potential for a few people to

become very wealthy 2. Increases the gap

between the rich andthe poor

New Type of Business EntitiesNew Type of Business Entities

Vertical and Horizontal Integration

The Public Responds:John D. Rockefeller

Ida Tarbell

Keppler, Joseph J. (1890) The Bosses of the Senate.

$ Inequality is inevitable and good. (Social Darwinism)

$ Wealthy should act as “trustees” for their “poorer brethren.”

$ The rich had been chosen to serve as “stewards of wealth”.

$ “The man who dies possessed of millions of available wealth which was free and in his hands ready to be distributed will die disgraced.”

$ Inequality is inevitable and good. (Social Darwinism)

$ Wealthy should act as “trustees” for their “poorer brethren.”

$ The rich had been chosen to serve as “stewards of wealth”.

$ “The man who dies possessed of millions of available wealth which was free and in his hands ready to be distributed will die disgraced.”

Andrew Carnegie Responds “The Gospel of Wealt

h”

Ida Tarbell’sresponse to John D.Rockefeller?

Congress’Response?

Sherman Anti-Trust Act 1890

A New Development: Mass Marketing, Advertising and

Department Stores

Harper’s Weekly: In 1870, an annual subscription cost $4.00.  An advertisement cost $1.50 per line per insertion for an inside page and $2.00 for an outside page.  The newspaper had 16 tabloid-size pages per issue before 1870, and then increased up to 24 pages per issue. Its circulation exceeded 100,000 on a regular basis and reached 300,000 at times.

Mail Order Catalogs: Houses

The Foursquare was a popular mail-order era style along with the California bungalow. When one was ordered, it came in a boxcar with a book of directions and all the parts pre-cut and numbered for self-assembly. These homes are particularly common in neighborhoods near rail-lines built in this era.

Mail Order Catalogs and Department Stores

Section 3:

Labor Strives to Organize

Where arethese workerscoming from?

Knights of Labor 1869Knights of Labor 1869

Terence V. PowderlyTerence V. Powderly

An injury to one is the concern of An injury to one is the concern of all!all!

Goals of the Knights of LaborGoals of the Knights of Labor

ù Eight-hour workday.Eight-hour workday.

ù WorkersWorkers’’ cooperatives. cooperatives.

ù Worker-owned factories.Worker-owned factories.

ù Abolition of child and prison labor.Abolition of child and prison labor.

ù Equal pay for men and women.Equal pay for men and women.

ù Safety codes in the workplace.Safety codes in the workplace.

ù Prohibition of contract foreign labor.Prohibition of contract foreign labor.

ù Abolition of the National Bank.Abolition of the National Bank.

Skilled and unskilled WorkersWomenNo African Americans until 1883

Management vs. Labor

Management vs. Labor

““ToolsTools”” of of ManagementManagement

““ToolsTools”” of of LaborLabor

““scabsscabs””

Company townsCompany towns

PinkertonsPinkertons

lockoutlockout

blacklistingblacklisting

yellow-dog yellow-dog contractscontracts

court injunctionscourt injunctions

open shopopen shop

boycottsboycotts

sympathy sympathy demonstrationsdemonstrations

informational informational picketingpicketing

closed shopsclosed shops

organized organized strikesstrikes

““wildcatwildcat”” strikes strikes

“I promisenot to join a union”

Strike by workers without

permission of their

unions

Labor Unrest 1870-1900

The Great Upheaval

Baltimore & Ohio RR cut wages for a secondtime in a year – protesting workers refused tolet any trains move until their pay was restored- Militia refused to use force against strikers- federal troops called in – sympathy strikesFederal troops finally ended it a few weeks later

Haymarket Riot (1886)Haymarket Riot (1886)McCormick Harvesting Machine Co.McCormick Harvesting Machine Co.

Strike demanded 8 hr workdayUnder the control of anarchistsPolice confrontation = 2 workers deadHaymarket Square = bomb, 70 officers wounded7 officers dead, 2 civilians dead

“The Haymarket Martyrs”

How the American Federation of Labor (AFL)

would Help the Workers (1886)

How the American Federation of Labor (AFL)

would Help the Workers (1886)ù Catered to the Catered to the skilled worker.skilled worker.

ù Represented workers in matters of Represented workers in matters of national legislation.national legislation.

ù Maintained a national strike fund.Maintained a national strike fund.

ù Evangelized the cause of unionism.Evangelized the cause of unionism.

ù Prevented disputes among the many Prevented disputes among the many craft unions.craft unions.

ù Mediated disputes between Mediated disputes between management and labor.management and labor.

ù Pushed for Pushed for closed shops.closed shops.

Samuel GompersSamuel Gompers

Carnegie announced his intention to impose an 18 percent pay cut and issued a statement saying that the real issue was whether the Homestead steel workers would be union or non-union. He ordered a 12 foot high fence to be built around the plant – 3 miles in length – with 3 inch holes at shoulder height every 25 feet, signaling preparation for an armed fight with the workers. At the same time Carnegie hired the notorious Pinkerton company to provide armed thugs for the upcoming struggle. An ultimatum was issued for workers

to accept the wage cut by June 24th or face mass layoffs.

Homestead Strike 1892, Carnegie Steel Works, Homestead, PA

Pullman, Illinois

Home of thePullman Sleeping CarCompany

The Pullman Strike of 1894

The Pullman Strike of 1894 Eugene V. Debs:

(Socialist)President of the AmericanRailway Union

Social Darwinismand role of government?

By late 1800s =StrikesLabor Unions

President Grover Cleveland:

If it takes the entire army and navy to deliver a postal card in Chicago, that card will be delivered!