Robber Barons or Captains of Industry

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Robber Barons or Captains of Industry

• What various practices of industrialists/financier
  s led to their being labeled "robber barons"?
  "Captains of industry"? In what ways did such
  industrialists/financiers harm and/or benefit the
  U.S. economy and the quality of life of its
  citizens?

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Essential Questions

• Though a century has passed since the heyday of
  the great industrialists and financiers, debate
  continues
• Were these men captains of industry, without whom
  this country could not have taken its place as a
  great industrial power, or were they robber
  barons, limiting healthy competition and robbing
  from the poor to benefit the rich?
• Where do we draw the line between unfair business
  practices and competition that leads to
  innovation, investment, and improvement in the
  standard of living for everyone? Would the
  industrial economy have succeeded without
  entrepreneurs willing to take competition to its
  extremes?

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John D. Rockefeller

• Standard Oil
• employed tactics that made him a legend. Imposing
  his own discipline on the industry, he bought up
  rivals, modernized plants and organized the oil
  industry on an enduring basis
• Gave away over 500 million
• Rockefeller foundation
• University of Chicago

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John D. Rockefeller

• Rockefeller had a droll, genial personality that
  masked supreme cunning and formidable
  self-control.
• colluded with railroads to gain preferential
  freight rates, secretly owned rivals, bribed
  state legislators and engaged in industrial
  espionage.
• Large profits didnt pass along to workers
• Low wages and undercut competitors
• After controlling market hiked prices back up
• Gained rebates and kickbacks from RR companies

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Andrew Carnegie

• Gets start in RRs enters Steel Market in 1873.
  By 1899 manufactures more steel than all in GB
  combined

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Andrew Carnegie

• Reasons for success
• Management practices searched for cheapest ways
  to make products
• Incorporated new techniques, technology to
  improve quality
• Sought most talented people offered stock and
  encouraged competition among workers
• Tried to control industry used vertical
  integration
• Bought out all his suppliers
• Attempted horizontal integration controlled up
  to 80 of steel industry

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Andrew Carnegie

• To sum up, do not drink, do not smoke, do not
  indorse, do not speculate. Concentrate, perform
  more than your prescribed duties be strictly
  honest in word and deed. And may all who read
  these words be just as happy and prosperous and
  long lived as I wish them all to be. And let this
  great fact always cheer them It is impossible
  for any one to be cheated out of an honorable
  career unless he cheats himself. Carnegie

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Carnegies Philanthropy

• "The man who dies rich dies disgraced,"
• You should be able to make as much money as you
  want if you give back
• created 2,800 free libraries worldwide.
• Carnegie Hall and other arts venues money still
  supports them today
• Carnegie Mellon University

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John Pierpont Morgan

• Made his fortune in banking and financing
• took over other people's businesses and hated
  competition.
• Known for cut-throat business practices
• wanted to absorb their competition by forming
  giant trusts and monopolies felt price wars
  were ruining American economy
• Would sell "watered," or over-valued, railroad
  stock to the public. When people found out their
  stocks were worth less than they thought, they
  sold them at a loss, and the railroad went
  bankrupt

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Cornelius Vanderbilt

• I have been insane on the subject of moneymaking
  all my life.Cornelius VanderbiltYou have
  undertaken to cheat me. I won't sue you, for the
  law is too slow. I'll ruin you.Cornelius
  Vanderbilt
• Law? Who cares about the law. Hain't I got the
  power?Comment alleged to have been made by
  Cornelius Vanderbilt, when warned that he might
  be violating the law