growth of big business. big business: two views “robber barons” “robber barons” connoted...
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Growth of Big Business
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Big Business: Two Views
“Robber Barons” Connoted that business leaders stole
from the public Paid workers meager, subsistence
wages Drove competitors to ruin
“Captains of Industry”
Served nation in positive way
Increased productivity, found new overseas markets, created jobs
Founded museums, libraries, and universities
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Some Leaders of Industry
John Pierpont (J.P.) Morgan--Banking John D. Rockefeller—Standard Oil James B. Duke—Tobacco Andrew Carnegie—U.S. Steel Cornelius Vanderbilt—railroads Bell--AT&T DuPont—chemicals, etc. Some charitable Most practiced conspicuous consumption,
showing off the wealth by purchasing the most expensive material goods possible
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Production of steel
1. Mining natural resources such as iron ore, coke, copper
2. Transport of resources to factory3. Bessemer process to develop steel4. Transport of steel to market for sale
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Andrew Carnegie: Carnegie Steel Company
Owned every aspect of his steel production
1. The mines that produced the iron ore
2. The ships that carried it from the UP to docks at Erie, Pennsylvania
3. The rails that transported it to his steel mills
4. The steel mills in Pittsburg
Vertical Integration
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Production of oil
1. Discovery2. Retrieval3. Transport to refinery4. Refining into usable components5. Transport to markets for sale
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Horizontal integration Purchased refineries to turn crude oil
into kerosene Purchased miles and miles of pipeline Built and owned most oil cars used for
transportation of crude oil to refineries
John Rockefeller – Standard Oil
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Sherman Anti-Trust Act Passed under pressure from citizens in
1890 Passed to limit the power of large
business combinations known as trusts
Poorly written and rarely enforced Law did not accomplish what it was
designed to do but it did create a precedent that Congress could place some regulations on business
Federal Government - Congress
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Business Cycle Can be portrayed as a wave moving through
the ocean1. Top of the wave is known as the Boom
period or crest2. Bottom of the wave is known as the Bust
period or the through – also called a depression
3. As the wave moves from the crest toward the bottom of the through, it is called economic decline or recession
4. As the wave grows from the bottom of the through, it is called economic recovery
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