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Big Business & Labor
Section 3: Big Business + Labor• Can you correctly match these names and
faces, and the industry for which he is
famous?
• Oil, steel, railroads, banking
J.P. MorganCornelius Vanderbilt John D. Rockefeller Andrew Carnegie
C. Vanderbilt
Railroads
Andrew Carnegie
Steel
J.P. Morgan
Banking
John D. Rockefeller
Oil
Corporations• Corporations: businesses that sell
portions of ownership
• Corporations reward owners and stockholders
(get a % of profits based on stock they own)
– Advantages- stockholders not responsible for
business debts
– Lose only money they invested
NEXT
Carnegie’s Innovations
Carnegie Makes a Fortune
• Andrew Carnegie one of first moguls to make
own fortune
-Son of Scottish immigrants
- Worked his way up in RR business
- Started steel competitors when prices were low
Big Business and Labor2
SECTION
New Business Strategies• Carnegie searches for ways to make better products more
cheaply
• Hires talented staff; offers company stock; promotes
competition
• Uses vertical integration—ownership of business involved in
each step of manufacturing process
• Buys out suppliers to control materials (iron ore mines,
coalfields, etc.)
• Example:
– A jewelry company not only sells finished products (rings),
but also owns the company that makes and cuts the
diamonds
– A soda company owns the raw ingredients, the factory, and
bottling
– Others??
Vertical Integration
• Controlling all phases of production
Lower the costs of making product and charge less
than competitors
Question: What problems might a business face when trying to
compete with a company with a vertical monopoly?
Car
neg
ie S
teel
Co
mp
any O
wn
s al
l p
has
es o
f pro
du
ctio
nRailroads- Purchased
by Carnegie
Steel mills- Purchased by Carnegie
Coal fields- Purchased by Carnegie
Horizontal Integration
• Companies bought out competitors (of similar
products) in their field
Standard Oil Company
Industrial Refinery
Industrial refinery
Industrial refinery
Purchased by
Rockefeller
Question: What problems might a business face when trying to
compete with a company with a horizontal monopoly?
Mini- Quiz: True or False?
1. Vertical Integration is when one company owns all businesses in a certain field.
2. John D. Rockefeller struck it rich in the oil business.
3. Andrew Carnegie started a corporation in the railroad business.
4. Stockholders own a portion, or percentage of profits, of a corporation.
Stop: Quick-write
• What were Carnegie’s management and
business strategies?
• Use notes and pp. 447- 48
Social Darwinism
Social Darwinism is a belief, popular in
the late Victorian era in America
The strongest or fittest should survive and
flourish in society
while the weak and unfit should be allowed
to die
NEXT
Social Darwinism and Business2
SECTION
A New Definition of Success
• Idea of survival, success of the most capable
appeals to wealthy
• See riches as sign of God’s favor; poor must
be lazy, inferior
Stop and Write!
Do you agree or disagree with the theory of
Social Darwinism? Why?
- Write 2-4 sentences and discuss with a partner.
What & Who is a Robber Baron?
Industrial leader of great wealth
Carnegie, Rockefeller, etc.
These men made huge personal fortunes,
typically by anti-competitive or unfair
business practices.
John D. Rockefeller founds Standard Oil Company,
forms trust
- Trust- many companies under one board of directors
- trustees run separate companies as if one
- Trusts try to eliminate competition
What is a monopoly?
• https://www.youtube.com/watch?v=2TdQ7YrI
3SI
• What three things are needed for a monopoly?
• What is a negative result of a monopoly?
• What can you not have with a monopoly?
• What can stop a monopoly?
John D. Rockefeller: Oil, Money and Power
“What a Funny Little Government”–
This cartoon was illustrated by Horace Taylor in
1899, which shows John D. Rockefeller holding the
White House and Treasury Department in his palm.
Rockefeller and the “Robber Barons”
• Rockefeller soon controlled 90% oil business
– Huge profits
– Low wages for workers
– Drove competitors out of business by selling his
product lower
– Controlled the market and increased prices
Question: Why was he called a “robber baron”?
“Captains of Industry”
• Philanthropy (charity)
• Carnegie
– Gave away over 90% of his wealth
– Carnegie Mellon University in Pittsburgh
• Rockefeller gave away over $500 million
– Rockefeller Foundation
– Rockefeller Center in NYC
Vanderbilt mansion, The Breakers
Newport, RI
Rockefeller estate
Tarrytown, NY
Monopolies- Good or bad?
Exit ticket:
After reading the article, respond in one
paragraph, providing at least two examples to
support your response. (Separate piece of paper)
Do you think monopolies are good or
bad for the U.S.? Why?
Political CartoonsFor each cartoon, answer:
1. Name 3 symbols in each cartoon and what they represent.
2. What is the cartoon’s message?
________________________________________________________________________
________________________________________________________________________
________________________________________________________________________
________________________________________________________________________
_______________________________________________
For each cartoon, answer:
Name 3 symbols in each cartoon and what they represent.
What is the cartoon’s message?
_________________________________________________________________________
_________________________________________________________________________
_________________________________________________________________________
“Traits of a Titan”: Disc 3 Men Who Built America
• List the traits/qualities you would expect a
successful business leader to have:
• During the film clip, check off any traits on
discussed in the clip that match with your list
The ‘Bosses’ of the
Senate
The Reorganization of Work
The Assembly Line
% of Billionaires in 1900
% of Billionaires in 1918
The Protectors of Our
Industries
The ‘Robber Barons’ of the
Past
Cornelius [“Commodore”]
Vanderbilt
Can’t I do what I want with my money?
William Vanderbilt
$ The public be damned!
$ What do I care about the law? H’aint I got the power?
The Gospel of Wealth:Religion in the Era of Industrialization
Russell H. Conwell
$ Wealth no longer looked upon as bad.
$ Viewed as a sign of God’s approval.
$ Christian duty to accumulate wealth.
$ Should not help the poor.
“On Wealth”
Andrew Carnegie
$ The Anglo-Saxon race is superior.
$ “Gospel of Wealth” (1901).
$ Inequality is inevitable and good.
$ Wealthy should act as “trustees” for their “poorer brethren.”
Regulating the Trusts
1877 Munn. v. IL
1886 Wabash, St. Louis & Pacific Railroad Company v. IL
1890 Sherman Antitrust Act in “restraint of trade”
“rule of reason” loophole
1895 US v. E. C. Knight Co.
Relative Share of World
Manufacturing
Modern ‘Robber
Barons’??
No person will make a great
business who wants to do it all
himself or get all the credit.
Andrew Carnegie
Sherman Anti-Trust Act
• Government thinks expanding corporations stifle free
competition
• Sherman Antitrust Act: illegal to create monopolies
or trusts
– trust illegal if interferes with free trade
•Prosecuting companies difficult; government stops
enforcing act
NEXT
continued Fewer Control More
Business Boom Bypasses the South
• South recovering from Civil War, hindered by lack of
capital
• North owns 90% of stock in RR, most profitable
Southern businesses
• Business problems: high transport cost, tariffs,
few skilled workers
2
SECTION
Start of Unions
A union is a workers' organization which
represents its members
aims to improve things
working conditions and pay
Labor Force Distribution1870-1900
The Changing American
Labor Force
Labor Unrest: 1870-1900
Ch. 14 Section 3: Industrial Workers
Look at the image on p. 625.
1. Make up at least 2 questions about the image.
_________________________________________________________________
_________________________________________________________________
_________________________________________________________________
2. Make 2 predictions about the picture.
_________________________________________________________________
_________________________________________________________________
________________________________________________________________
3. Find three objects in the image beginning with the letter “t”. Find three objects in the
image beginning with the letter
“c.”______________________________________________________________
_________________________________________________________________
_________________________________________________________________
_________________________________________________________________
Workers at the Stetson Hat Company in Philadelphia, PA, 1910
Workers at the Burpee Seed Company, Philadelphia, PA 1890
Decline in Working Conditions
• Machines, unskilled
workers
• Specialization (repetitive
tasks) to bring down
costs, increase production
• Caused boredom and
injuries
• Ford and moving
assembly line- workers
seen as “interchangeable”
parts
Child Labor
Child Labor
“Galley Labor”
The First Unions in America
AFL American Federation of Labor: organized by Samuel Gompers
American Railway Union: organized by Eugene V. Debs
IWW Industrial Workers of the World: radicals and socialists “The Wobblies”
United Mine Workers: organized by Mary Harris “Mother” Jones
Knights of Labor
Terence V. Powderly
An injury to one is the concern of all!
Knights of Labor
Knights of Labor trade card
Goals of the Knights of
Laborù Eight-hour workday.
ù Workers’ cooperatives.
ù Worker-owned factories.
ù Abolition of child and prison labor.
ù Increased circulation of greenbacks.
ù Equal pay for men and women.
ù Safety codes in the workplace.
ù Prohibition of contract foreign labor.
ù Abolition of the National Bank.
AFL IWW
Only skilled workers All workers welcome to join
Legal-
took business owners to court
Radical Practices
The American Federation
of Labor: 1886
Samuel Gompers
How the AF of L
Would Help the Workersù Catered to the skilled worker.
ù Represented workers in matters of national legislation.
ù Maintained a national strike fund.
ù Evangelized the cause of unionism.
ù Prevented disputes among the many craft unions.
ù Mediated disputes between management and labor.
ù Pushed for closed shops.
The Socialists
Eugene V. Debs
International Workers of
the World (“Wobblies”)
“Big Bill” Haywood of
the
IWW
Violence was justified to overthrow capitalism.
I W W & the
Internationale
Vertical
Integration
Horizontal
Integration
Social
Darwinism
Draw a Visual
representing this
term.
Draw a Visual
representing this
term.
Draw a Visual
representing this
term.
Reflection Question
Why was it necessary for Unions to form?
How were unions going against the notion
of Social Darwinism?
Gallery Walk: Answer the following, pp. 453- 454 (your assigned # with your group)
1. Describe the Great Strike of 1877
2. Haymarket Affair-
3. Homestead Strike-
4. Pullman Strike-
5. Mary Harris Jones-
The Great Railroad Strike
of 1877
The Great Railroad Strike
of 1877
The Tournament of Today:
A Set-to Between Labor and
Monopoly
Anarchists Meet on the
Lake Front in 1886
Haymarket Riot (1886)
McCormick Harvesting Machine Co.
Haymarket Martyrs
Governor John Peter
Altgeld
Homestead Steel Strike
(1892)
The Amalgamated Association of
Iron & Steel Workers
Homestead Steel Works
Big Corporate Profits!
Attempted Assassination!
Henry Clay Frick
Alexander Berkman
A
“Compan
y
Town”:
Pullman,
IL
Pullman Cars
A Pullman porter
The Pullman Strike of 1894
President Grover Cleveland
If it takes the entire army and navy to deliver a postal card in Chicago, that card
will be delivered!
The Pullman Strike of 1894
Government by injunction!
The Hand That Will Rule
the World One Big Union
Mother Jones:
“The Miner’s Angel”
Mary Harris.
Organizer for theUnited MineWorkers.
Founded the SocialDemocratic Party in 1898.
One of the founding members of the I. W. W. in 1905.
Labor Union Membership
“Solidarity Forever!”by Ralph Chapin (1915)
When the union's inspiration through the workers‘ blood shall run,
There can be no power greater anywhere beneath the sun;
Yet what force on earth is weaker than the feeble strength of one,
But the union makes us strong!
CHORUS:Solidarity forever,Solidarity forever,Solidarity forever,For the union
makes us strong!
Come On and
Sing Along!!
“Solidarity Forever!”Is there aught we hold in common
with the greedy parasite,Who would lash us into serfdom
and would crush us with his might?Is there anything left to us
but to organize and fight?For the union makes us strong!
CHORUS:Solidarity forever,Solidarity forever,Solidarity forever,For the union
makes us strong!
“Solidarity Forever!”* * * *
Through our sisters and our brotherswe can make our union strong,
For respect and equal value, we have done without too long.
We no longer have to tolerate injustices and wrongs,
Yes, the union makes us strong!
CHORUS:Solidarity forever,Solidarity forever,Solidarity forever,For the union
makes us strong!
Workers Benefits Today
The Rise & Decline of
Organized Labor
Right-to-Work States Today
Unionism &
Globalization?
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