THE RISE OF BIG BUSINESS MONOPOLIES

1. THE RISE OF BIG BUSINESS & MONOPOLIES

2. 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.

3. 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�

4. 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.

5. 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 Vanderbilt�s RR companies. This was a major factor in the stimulation of the nation�s economy

6. 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 nation�s oil refining. Set up �Trusts� which allowed him to stay in the background, while running the business.

7. 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.

8. 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 Carnegie�s holdings in 1901 for $500 Million. This was the 1st $1 Billion corporation in the US

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

10. Manufacturing & Invention 235,000 US Patents were issued in the 1890�s 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

11. 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 Bell�s design � this is the prototype of the modern telephone. Bell set out and formed the American Telephone & Telegraph Co. (AT & T)

12. 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 100�s 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

13. Nicola Tesla Born around July 9, 1856 in Smiljan, Croatia. While in Paris he actually worked for the Continental Edison Co. (Thomas Edison�s 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 Tesla�s 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

14. 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.

15. 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.

16. Political Changes Anarchism � the opposition to all existing gov�t. 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.

17. 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.

18. Daniel DeLeon � gave notice to the rise of the socialist movement in the US in the 1890�s. 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.