Big Business and Unions Notes

2. Big Business and Unions Notes

3. The Rise of Big Business • Big businesses exist because they can produce goods more cheaply and efficiently than small businesses • This forced many small companies out of business • Think Wal-Mart vs. a local store, what do you sacrifice in order to buy something for less money?

4. The Self Made Man • Andrew Carnegie • emigrated to the US from Scotland in 1848 • Worked his way from bobbin boy in a textile factory making $1.20 a week to making $50,000 a year with a railroad company and creating his own business investing in the steel industry

5. Vertical and Horizontal Integration Vertical Integration • Buying all of the different businesses that the operation of a company depends upon • Example: • A clothing company would own the trucks to distribute, the factory, the cotton farm, etc. • Buying several small businesses to create one large business • Example: • Independent oil companies combine to create the US Oil Company • When a single company controls an entire market it becomes a monopoly • Many Americans feared monopolies because they could charge whatever price they wanted to Horizontal Integration

6. Working in the United States • Working conditions were not very regulated • Workers breathed in toxic fumes, lint, and dust • Average industrial worker in 1900 made 22 ¢ per hour and worked 59 hours per week ($12.98 per week, $51.92 per month)

7. Early Unions • Many workers wanted to form unions • What do unions ALWAYS want? • Better working conditions (safety) • Better pay • Better hours • Company owners didn’t like unions because they thought they interfered with their property rights • Companies required workers to sign contracts against unions, hired detectives to identify union organizers, and blacklisted workers who tried to unionize • Companies would lock workers out of their property and refuse to pay them until they broke up the union

8. Marxism • Marxism (a set of ideas of Karl Marx) started to scare people in the capitalist US • Believed that workers could eventually revolt and seize control of factories • Many European immigrants had heard the ideas of Marx and when they came to the US nativism (anti-immigrant feelings) started to spread

9. The Struggle to Organize • The recession that started in 1873 continued into 1877 • Railroad workers across the country walked onto the tracks and refused to move • After property had been destroyed and people killed, President Hayes sent the army out to stop the strike

10. The Haymarket Riot and the Pullman Strike • Haymarket Riot • Movement for 8 hour workday • Nationwide strike on May 1, 1886 • Chicago: clash between strikers and police left one striker dead. • Next day a protest was organized in Haymarket Square • Police entered the square and someone threw a bomb • Police opened fire and workers shot back • 8 German men were arrested • Evidence was weak but 4 were executed • Pullman Strike • Pullman (railroad cars) Factory workers had been required to live in a company town • Get paid, pay rent to company, buy food from company, nothing left to save • Went on strike because of slashed wages and the firing of 3 workers who complained • Workers across the U.S. boycotted Pullman cars and refused to handle them, tying up railroads and threatening to paralyze the economy • Railroad managers had US mail cars attached to Pullman cars so the workers would be interfering with the US mail (violation of federal law) • President Cleveland sent in troops