GOAL FIVE 5.02

1
GOAL FIVE5.02

• Becoming an Industrial Society
• (1877-1900)
• The learner will describe innovations in
  technology and business practices and assess
  their impact on economic, political, and social
  life in America.
• Explain how business and industrial leaders
  accumulated wealth and wielded political and
  economic power.

2
Bessemer Process

• A method for making steel by blasting compressed
  air through molten iron to burn out excess carbon
  and impurities.
• Cheaper and faster production of steel.

3
Andrew Carnegie- (1935-1919)

• philanthropist and industrialist. Carnegie, a
  poor immigrant from Scotland, became one of the
  richest men in the world. In 1899 he established
  the Carnegie Steel Corporation by buying and
  consolidating many smaller steel mills. In 1901
  his firm became one of the largest steel
  companies in the world when it joined with the
  U.S. Steel Corporation.

4
John D. Rockefeller (1839-1937)

• industrialist and philanthropist. Rockefeller was
  the primary force behind the establishment of the
  Standard Oil Company and thus of the American
  petroleum industry. He began his business career
  as a bookkeeper-clerk in a commission house the
  same year. The first successful drilling for oil
  took place in western Pennsylvania in 1859, and
  Rockefeller realized that Cleveland was ideally
  suited to exploit this new resource.

5
John D. Rockefeller (1839-1937)

• He built his first refinery in 1863 in
  partnership with others. The early oil business
  was chaotic and hazardous, with barrel prices
  rising as high as 13.75 and falling as low as
  ten cents during the 1860s, but Rockefeller, a
  born executive, kept his firm consistently
  profitable and growing. In 1870 he, Henry
  Flagler, and others formed the Standard Oil
  Company, with Rockefeller owning 26.7 percent of
  the stock.

6
John D. Rockefeller (1839-1937)

• Using such then-legal tactics as railroad rebates
  and predatory pricing, Standard Oil steadily
  increased its hold over the American oil industry
  until by 1880 it controlled fully 90 percent of
  it. The corporate structure of this expanding
  enterprise had become unwieldy, and state
  corporation laws made it difficult to rationalize
  what had become a nationwide company. In 1882,
  Standard Oil's legal counsel devised the trust
  form of organization. Standard Oil thus became
  both the first and the largest of the "trusts,"
  one of the great bogeymen of American politics
  ever since.

7
John D. Rockefeller (1839-1937)

• As such, it necessarily became a major target of
  reformers. Although he played the game hard,
  Rockefeller never operated outside the law or
  sought an absolute monopoly. Rather, he wanted
  Standard Oil to be large enough to enforce
  "order" in the oil business and prevent a return
  to the chaos that had marked the industry's early
  years. And despite Standard's near monopoly
  position, the price of oil and oil products fell
  drastically between 1870 and 1900. In 1883,
  Rockefeller moved the company's headquarters to
  New York.

8
John D. Rockefeller (1839-1937)

• Always active in the Baptist church, Rockefeller
  early began the practice of making substantial
  charitable contributions. As his resources grew,
  so did his philanthropy. He had largely retired
  from Standard Oil by 1897 and devoted much of his
  energy to looking for creative ways to give his
  money away. He established an organization to
  investigate carefully before giving. Once he had
  made up his mind, however, he gave with wholly
  unprecedented generosity.

9
John D. Rockefeller (1839-1937)

• In 1889 he gave 600,000 to establish the
  University of Chicago (the family would
  ultimately give it more than 80 million), and in
  the final decades of his long life he gave away
  an estimated 550 million to worthy causes. He
  also established the Rockefeller Institute, the
  General Education Board, the Rockefeller
  Foundation, and the Laura Spelman Rockefeller
  Memorial Foundation.

10
J.P. Morgan

• Morgan headed J. P. Morgan and Company, the most
  important force in American finance in the
  quarter century before World War I, a time when
  the burgeoning American economy grew to be the
  largest and most powerful in the world. After
  completing his education at the university at
  Göttingen, Germany, in 1857, Morgan went to work
  on Wall Street. In 1862 he opened his own firm
  and in 1871 joined forces with the Drexel firm of
  Philadelphia.

11
J.P. Morgan

• The new firm, Drexel, Morgan and Co., opened its
  offices at the corner of Wall and Broad streets
  where the headquarters of the Morgan Bank have
  been located ever since. As industrial companies
  came to dominate the American economy, it was his
  firm that financed many of them, including
  General Electric and International Harvester. In
  1901 Morgan was instrumental in the creation of
  U.S. Steel, the largest corporate enterprise in
  the world at the time, capitalized at 1.4
  billion.

12
J.P. Morgan

• By the turn of the century Morgan had become the
  very symbol of Wall Street, the man the financial
  community looked to for leadership. In 1907, when
  a banking panic threatened to spin out of
  control, Morgan took command, rallied the other
  bankers, and restored confidence. This panic led
  to the creation of the Federal Reserve System in
  1913, the same year Morgan died in Rome, Italy.

13
Vanderbilt Family

• wealthy family known for the trust they owned in
  particular, the railroads they controlled.
• Biltmore Estate, Asheville, NC

14
Edwin Drake

• In 1859, Colonel Edwin L. Drake was hired to
  drill for oil, a novel idea at the time, at what
  became Titusville, Pennsylvania. Drakes Folly
  eventually struck oil and began producing
  hundreds of barrels each month. The discovery
  touched off an oil rush nearly as intense as the
  earlier gold rush in California.

15
Standard Oil Company

• Well know trust founded by John D. Rockefeller.
  The company worked to weed out all competition by
  putting prices below cost and then after
  competition was gone the prices would be raised.

16
U.S. Steel

• The largest steel manufacturing company in its
  time and was owned by Andrew Carnegie and later
  sold to J.P. Morgan.

17
George Westinghouse- (1846-1914)

• inventor and industrialist. Westinghouse obtained
  about four hundred patents during his lifetime,
  most concerning railways, electricity, and
  natural gas. He invented the air brake in 1868,
  leading to the formation of the Westinghouse Air
  Brake Company and his fortune. He also invented
  the gas meter and pioneered a control system of
  pipes to conduct natural gas into homes safely.
  In 1886 he formed the Westinghouse Electric
  Company and devised the use of alternating
  current for electric power transmission.

18
Gospel of Wealth

• Book written by Andrew Carnegie. His book argued
  that the wealthy have an obligation to give
  something back to society.

19
Horatio Alger- (1834-1899)

• was the son of a Unitarian minister and graduated
  with degrees from Harvard College and Harvard
  Divinity. He was rejected for service in the
  Civil War and became a minister on Cape Cod.
  Alger turned to writing after losing his pulpit
  under somewhat mysterious circumstances. In 1867,
  he published the first of more than 100 short
  novels depicting rags-to-riches stories meant to
  inspire the nations youth.

20
Horatio Alger- (1834-1899)

• Bearing such titles as Ragged Dick and Tattered
  Tom, the novels traced the rise of street urchins
  to positions of wealth and prominence. The
  virtues of loyalty, hard work, faith, thrift and
  clean living were trumpeted. Algers work made no
  pretense of literary merit, but was intended to
  convey the idea that great rewards awaited those
  who applied themselves and followed the rules.
  Alger, whose name became synonymous with
  successful fortune seeking, sold more than 100
  million books.

21
Social Darwinism

• Social Darwinism was an application of Charles
  Darwin's theory of evolution to the field of
  social relations. It was based on the theory that
  society had operated like a jungle, in which only
  the strongest and best adaptedthe
  "fittest"survived. By the 1870s, the American
  business world had itself come to exemplify the
  struggle for existence. Corporate leaders seized
  on Social Darwinism as "scientific" justification
  for their actions. Businessmen like Andrew
  Carnegie argued that unrestrained competition was
  simply natural selection at work, steadily
  improving the national economy by weeding out the
  unfit.

22
Trust

• a combination of firms or corporations for the
  purpose of reducing competition and controlling
  prices throughout a business or an industry.

23
Monopoly

• an economic arrangement in which a single company
  controls the production and sale of a product.
  Efforts to create monopolies were frequent in the
  late nineteenth and early twentieth centuries.
  Examples are the U.S. Steel Corporation and the
  Standard Oil Company. The abuse of monopolies led
  to the enactment of such federal laws as the
  Sherman Antitrust Act, the Clayton Antitrust Act,
  and the Federal Trade Commission Act. Today the
  U.S. Postal Service and many public utilities are
  monopolies, but state and federal governments
  have laws to control them, often enforced by the
  Federal Trade Commission.

24
Gilded Age

• the period between 1865 and 1900. During this
  time of great, showy displays of wealth, large
  fortunes were made as a result of industrial
  expansion. The name, a derogatory one, was
  derived from the title of a novel by Mark Twain
  and Charles Dudley Warner in 1873.