THE RISE OF BIG BUSINESS

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THE RISE OF BIG BUSINESS MONOPOLIES
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The Post war Economy

• Caused a growth of economic expansion
• The National Banking Act created a sounder
  economy, but the effects were vague at best
• The labor shortage caused an increase in
  invention, efficiency, faster more labor saving
  methods machinery
• The 2nd Industrial Revolution caused the US
  economy society to transform into a modern
  urban-industrial state.
• It created an interconnected national railroad,
  the use of electric power, the use of
  scientific research in the industrial process.

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The Transcontinental Railroad

• Railroads were the 1st Big Business
• RR were the 1st to attract large financial
  markets
• The 1st to develop large-scale management
  bureaucracy
• Union Pacific RR started in Omaha, Neb. And
  worked westward
• Central Pacific RR started in Sacramento, Ca. and
  worked eastward, in a race to see which RR would
  build the most track.
• Majority of the work was done by immigrants,
  mainly from Ireland China, but Mexicans,
  blacks, whites, Indians, also worked
• Union Pacific built 1,086 miles of track, while
  the Central Pacific built 689.
• Met at Promontory Point, Utah on May 10, 1869.
  Ca. Gov. Leland Stanford drove in the final
  Golden Spike

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Robber Barons

• Started with the immoral financial practices of
  the RR moguls, then spread to other
  Industrialists
• Bought politicians other government officials
• Stole the land from the people in the areas the
  RR wanted to go
• Jay Gould The Prince of the Robber Barons
  would buy old, run-down RR and polish them up
  to sell at a profit. They were very unsafe!
• Cornelius Vanderbilt was already very wealthy,
  made his fortune in the steamboat ind. Before
  the War. Switched over to RR during the War
  because the former was getting to risky.

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• Consolidated most of the eastern RR built spurs
  connecting major cities, i.e. NY Buffalo.
• Purchased the Lake Shore Mich. Southern RR
  giving him the very prosperous Chicago market
• After his death in 1877, his son, William Henry,
  continued the trend of extending RR lines. By
  1900 over two-thirds of the US RR lines were
  under the control of one of Vanderbilts RR
  companies.
• This was a major factor in the stimulation of the
  nations economy

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John D. Rockefeller

• Recognized very early the importance of oil
• Started the Rockefeller, Andrews Flagler Co. in
  1867
• By 1870 The Standard Oil Co. the largest
  refiner of oil. Began to systematically
  eliminate his competitors. He cornered the
  market on shipping RR, and forced them to
  inform him of his competitors movements
  shipments.
• He would then be in a position to by them out.
  Most wanted out of the oil business anyway, very
  chaotic and competitive. By 1879 he controlled
  90-95 of the nations oil refining. Set up
  Trusts which allowed him to stay in the
  background, while running the business.

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Andrew Carnegie

• A rags to riches story started as an immigrant
  from Scotland, worked as a Bobbin boy in the
  textile mills. Worked his way up to telegraph,
  RR the steel industry.
• He was never a steel expert, but surrounded
  himself with the most knowledgeable people in the
  field. He was an excellent promoter, salesman,
  organizer had the ability to find these experts
  cheaply
• He was called a Captain of Industry stated
  not evil, but good, has come to the race from the
  accumulation of wealth by those who have the
  ability energy that produces it
• Donated over 500 Million during his lifetime,
  mainly to colleges, universities, libraries,
  hospitals, parks recreation areas, the arts,
  etc.

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J.P. Morgan

• Born very wealthy, arrived in NY in 1857
• An investment banker bought corporate stocks
  bonds sold them at a profit.
• Consolidated the steel industry and later the RR
• US Steel Corp. merged the iron steel
  industries, bought out Carnegies holdings in
  1901 for 500 Million.
• This was the 1st 1 Billion corporation in the US

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Sears Roebuck

• Followed the lead of Montgomery Ward in the mail
  order business
• 1890s catalog was 786 pages offered anything
  everything
• The Wal-Mart of its day.
• Only made it because of the stable postal
  service, the RR and improved transportation
  routes.

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Manufacturing Invention

• 235,000 US Patents were issued in the 1890s
• Innovations in the steel ind. Increased
  production, quality, refining usage
• Refrigerated RR cars for the meat packing ind.,
  the harvesting of grain from the prairie regions
  of the west increased baked goods, the
  Automatic Cigarette Roller was a boon for the
  tobacco ind.
• Electrification communication technology had
  the single most largest impact on the lives of
  Americans

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Alexander Graham Bell

• Invented the telephone, patented in 1876 and
  formed the National Bell Telephone Co.
• Tried to sell it to Western Union, who thought it
  was a toy. Then Western Union hired Thomas Alva
  Edison to improve on Bells design this is the
  prototype of the modern telephone.
• Bell set out and formed the American Telephone
  Telegraph Co. (AT T)

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Thomas Alva Edison

• Invented mostly for the electrical industry
• Invented the Phonograph in 1877, the 1st
  successful incandescent light bulb. Many are
  still working in his home in Fla. For over 100
  yrs. Perfected 100s of other devices, i.e. the
  battery the motion picture.
• Started the Edison Electric Illuminating Co.
  This was the 1st electric utilities company.
  Supplied 85 people with electric power in their
  homes in NY City. Used DC current was limited
  to a 2 mile radius

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Nicola Tesla

• Born around July 9, 1856 in Smiljan, Croatia.
• While in Paris he actually worked for the
  Continental Edison Co. (Thomas Edisons company
  in France)
• Immigrated to the US in 1884, he was a prolific
  inventor. Created the AC current, discovered the
  rotating magnetic field, invented the Tesla Coil
  which is used in radio technology.
• George Westinghouse of the Westinghouse Electric
  Co. bought many of Teslas inventions patents.
  Especially his AC dynamo, which gave Westinghouse
  the upper hand in the Electric Wars
• He died in New York City on Jan. 7, 1943

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The Rise of the Unions

• Fought for better working conditions, used
  violent strikes to get their point across.
• This dominated the period of the Unions.
• The Knights of Labor 1869 founded by Uriah
  Stephens. Named the Noble and Holy Order of the
  Knights of Labor, supposedly had connections
  with secret societies the Masons. By 1886 it
  had about 700,000 members
• They took on the RR Jay Gould and defeated him.
  But 1 yr. Later with the Haymarket Affair
  their link with Anarchists.

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Union Violence

• The Haymarket Affair May 4, 1886 in response
  to the police killing a union striker at the
  International Harvester strike the day before,
  Anarchists planned an open protest at Haymarket
  Square in Chicago, Ill.
• After several speeches promoting anarchism
  socialism, the police moved in to break up the
  gathering.
• A bomb was thrown at the police killing 1
  injuring several. The police then fired on the
  crowd killing several.
• One of the anarchist leaders was German had a
  membership card to the Knights of Labor.
• This led to the downfall of the organization
  the belief that all unions are socialists.

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Political Changes

• Anarchism the opposition to all existing govt.
• Increased growth during this time, many were
  linked with the unions of the day. Led many
  violent protests, perpetuated the anti-immigrant
  feelings that were growing in the US. Many of
  the Anarchists immigrants were from Europe,
  i.e. Germany, Russia, etc. Mainly located in the
  upper mid-west region Wis., Mich., Minn., Ill.

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Socialism

• The government system in which co-operative
  action is the norm property is owned by the
  community, not the individual.
• American unions never really allied themselves
  with the socialist movement the way the European
  unions did. But much of the socialist ideals
  made their way into US unions, by the German
  other European immigrants bringing it with them.
  
• Many of the German immigrants were Marxists, a
  branch of socialism. Founded on the writings
  ideals of Karl Marx. Formed the Socialist Labor
  Party in NY in 1877.

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• Daniel DeLeon gave notice to the rise of the
  socialist movement in the US in the 1890s. His
  ideas influenced Lenin, but DeLeon wanted to
  start a workers revolution at the ballot box, not
  in the streets.
• Eugene V. Debs followed DeLeon in the socialist
  movement, but was not as peaceful. Built a
  larger following than DeLeon, organized the
  Social Democratic Party. He was the socialist
  candidate in several Pres. Elections, by 1912
  he had earned 6 of the popular vote for Pres.
• Many mid-west cities towns began electing
  socialst/Marxists officials to office. Mayors,
  Cong., Rep., Sen., etc. By 1912, 33 major US
  cities had socialists /or Marxists officials.

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