Growth of Big Business - 32

Growth of Big Business - 32

•Analyze the different types of businesses and business practices.•Compare and contrast the advantages and disadvantages of big business.•Define “Social Darwinism” and relate the concept to American society.•Who were the “Robber Barons”, and how did the Federal government intervene?

31-Industrial Development

• What type of government policies encouraged business growth in the late 1800’s?

• Who invented the telephone?• Who perfected the electric light bulb?• What inventor patented the AC power system we use today?• What business did John D. Rockefeller control?• What business made Andrew Carnegie one of the world’s wealthiest men?• What famous business man made the family fortune in railroads?• Pullman, Illinois is a perfect example of what type of business situation?• This federal law was passed in an attempt to regulate the activities of the

railroads? • This group began as a social group for farmers but eventually developed into a

political party?• This government agency was formed after the Granger laws were ruled

unconstitutional by the Supreme Court?• Name the speech given by the Democratic/Populist candidate that stated the

importance of farmers to the nation.• Name the two major candidates in the 1896 election?• These were the types of houses that many people first built when they moved to

the mid-west?• Name the great entrepreneur who was known for his large investment banking

deals?• Name the industrialist who controlled most of the tobacco/cigarette production

in the nation?

Big Business

The Strategies of and Backlash to the great Entrepreneurs

Big Business

- Corporations develop

- Limited liability leads to public investment

- Mass market selling John D.

Rockefeller

Standard Oil

Advantages

- Greater efficiency

Economy of scale

-The more you manufacture, the cheaper the item is to produce

- Manager system

- Productivity studies

Taylor

Andrew Carnegie - Steel

Disadvantages

- Unfair competition practices

- Corruption and bribery

- Destroyed labor union movements

J. P. Morgan - Banking

Public Reactions

- Mixed public feelings

- Social Darwinism

* based on Darwin’s theory of Natural Selection

“Survival of the fittest”

* Applied to the business world

-the best businesses survive

- Justified the wealth

* Rags to riches

“The American Dream”

* Horatio Alger

dime novels

Types of Big Businesses

- Monopoly

- Trust

- Merger

- Holding company

- Horizontal integration: see picture ===

- Vertical integration

Types of Big Businesses

- Monopoly

- Trust

- Merger

- Holding company

- Horizontal integration

- Vertical integration: see picture ===

Robber Barons

- Extreme profits made by business owners

- Philanthropy

- Big business practices exposed

- Public finally began to call for regulation

- Sherman Anti-trust Act, 1890

* Weak law, but set a precedent for future regulation

Standard Oil MonopolyBelieving that Rockefeller's Standard Oil monopoly was exercising dangerous power, this political cartoonist depicts the trust as a greedy octopus whose sprawling tentacles already ensnare Congress, state legislatures, and the taxpayer, and are reaching for the White House. (Library of Congress)

Standard Oil Monopoly

Copyright © Houghton Mifflin Company. All rights reserved.

Robber Barons

- Extreme profits made by business owners

- Philanthropy???

- Big business practices exposed

- Public finally began to call for regulation

- Sherman Anti-trust Act, 1890

* Weak law

Set a precedent for future regulation

Growth of Big Business - 32

•Analyze the different types of businesses and business practices.•Compare and contrast the advantages and disadvantages of big business.•Define “Social Darwinism” and relate the concept to American society.•Who were the “Robber Barons”, and how did the Federal government intervene?

Workers Unite - 33

Workers Unite

• Compare and contrast the AFL and the Knights of Labor.

• What were the labor issues during this time period?

• Identify major union figures and assess their contributions.

• Identify the major strikes and their outcomes.

URBAN LABOR

- Increased 400% by 1890

- Mostly unskilled labor

- Assembly line work

WORKING CONDITIONS

- Low wages

- Long hours

- Dangerous conditions

- Company towns

-Child labor

-SUM IT UP: TERRIBLE CONDITIONS

Child worker, glass factory

Child labor was common in the factories of 19th century America. (Library of Congress)

Child worker, glass factory

Copyright © Houghton Mifflin Company. All rights reserved.

Children in textile millsMuch of the new southern textile industry was based on child labor. These children were photographed by Lewis Hines in 1908. (National Archives/ Lewis Hines)

Children in textile mills

Copyright © Houghton Mifflin Company. All rights reserved.

WORKING CONDITIONS

-Low wages

-Long hours

-Dangerous conditions

-Company towns

-Child labor

The Workers Plight

LABOR UNIONS

- Tried to improve conditions of workers

Used strikes

Collective bargaining

Arbitration

- Owners countered with

blacklists

lockouts

scabs

injunctions

GOVERNMENT

INTERVENTION

- Great Railroad Strike of 1877

- Violent protests

- Federal troops sent to restore order

Railroad strike of 1877This engraving depicts striking railroad workers in Martinsburg, West Virginia, as they stop a freight train on July 17, 1877, in the opening days of the great railway strike of that year. Engravings such as this, which show the strikers to be heavily armed, may or may not have been accurate depictions of events. But the photography of that day could rarely capture live action, and the technology of the day could not reproduce photographs in newspapers, so the public's understanding of events such as the 1877 strike was formed through artists' depictions. (Library of Congress)

KNIGHTS OF LABOR

-Terence Powderly

- First major American Labor Union

- Any kind of labor accepted

- Eventually failed

-Weakness

Membership was too broad to be effective

HAYMARKET SQUARE

- Chicago strike of 1886

Bomb thrown at protest

Several people killed

-Union activity was blamed for the violence

-Public opinion turns against the labor movement.

*Knights of Labor movement ends as a result of Haymarket Riot

AFL

- Samuel Gompers

- Only allowed skilled labor to join

- Made strikes a legitimate weapon for union

AFL and Samuel Gompers• Both skilled and unskilled

laborers were subject to low wages, long hours, no vacations, and unsafe workplaces.– Workers had to band together

in labor unions to demand better pay and working conditions.

– The American Federation of Labor (AFL) was led by Samuel Gompers.

Goals of the AFL

- The AFL sought to use strikes to accomplish its goals.

Through strikes, the AFL would force employers to:

1. Give shorter workdays

2. Create better working conditions

3. Give higher wages

4. Give the workers better control over their workplace responsibilities.

INDUSTRIAL UNIONS

- Union combining all workers of an industry

-Homestead Strike- Steel worker strike resulting in violent battle with government officials. Steel workers were defeated.

- Eugene V. Debs

* United Railroad Workers

-Pullman Coach Strike, 1894

-Government steps in

* Debs is jailed

Pullman Strike

• Industrial Unrest – Protests and violence in factories, warehouses, etc.– This was very common in the era of big

business and labor reform– The Pullman Strike is a great example

• In 1894, when the Pullman railcar factory near Chicago fired employees and reduced wages, its workers went on strike.– Rail traffic west of Chicago came to a halt.

Pullman Strike

• The Pullman company responded by hiring new workers.– The new workers were attacked by strikers when they

attempted to go to work.• “Scabs” crossing picket lines

• Leaders of the railway industry convinced the government to declare the situation illegal.– President Grover Cleveland sent the U.S. Army to

restore peace.• Big business and the U.S. government both feared labor

unions were a threat to America’s capitalist economy.

King DebsThis famous cartoon about the Pullman strike, originally published July 14, 1894, in Harper's Weekly, shows Eugene Debs, head of the American Railway Union, sitting atop a railway bridge that has been turned to cut off all rail traffic. The railroad cars behind him are labeled "fresh vegetables," "beef," and "fruit," to emphasize the perishable nature of the products that could not be delivered, and others are identified as "U.S. Mail." In the background, factories have "closed" signs on them. This cartoon, and others like it, helped to mobilize opinion against the strikers. (Library of Congress)

King Debs

Copyright © Houghton Mifflin Company. All rights reserved.

Women Workers

- Worked for better conditions for miners

- Used women and children in the strike process

- Mary Harris “Mother” Jones

* Advocated against child labor

Pressure on Government

-Triangle Shirtwaist Fire

March 25, 1911

* Leads to government regulations on working conditions and child labor

Public supports the plight of workers, but likes cheap products

The Triangle Shirtwaist Fire

The Triangle Shirtwaist Fire

Pressure on Government

-Triangle Shirtwaist Fire

- Leads to government regulations on working conditions and child labor

- Public supports the plight of workers, but likes cheap products

The bodies of seamstresses, who jumped from the factory floors of the Triangle Shirtwaist Company to avoid being burned alive, lie outside the building.

Workers Unite

• Compare and contrast the AFL and the Knights of Labor.

• What were the labor issues during this time period?

• Identify major union figures and assess their contributions.

• Identify the major strikes and their outcomes.