Monopolies in the Gilded Age: Robber Barons or Captains of Industry?

1. Monopolies

2. The “Gilded Age” • Mark Twain, the famous American author, referred to the Industrial Era (1860s – 1900) as the “Gilded Age.” • Gilded: a thin metal coating (usually gold or silver) placed on top of an object • Why would Twain refer to this era as the “Gilded Age?” Is he being serious or sarcastic? • Think carefully about the term “Gilded.”

3. Monopolies: good or evil?

4. Monopolies: good or evil?

5. Monopolies: good or evil?

6. Monopolies Social Darwinism: “survival of the fittest” Laissez-Faire: no government regulation or rules (“survival of fittest is natural”) Monopolies: bigger, stronger business take over smaller businesses • Goal of monopolies: • ELIMINATE COMPETITION! • Why? • Less competition = more power and profit for ONE company! • Examples: • Pools • Trusts • Holding Companies

7. Two ways of organizing your monopoly Vertical Integration: A single company gains control over ALL companies that are involved in the production of a product

8. Two ways of organizing your monopoly Horizontal Integration: A single company gains control over ALL rival companies that make the SAME product

9. Monopolies Social Darwinism Laissez-Faire Monopolies • Monopolies were formed in all of the following industries: • Oil: Rockefeller’s Standard Oil Company controlled 95% of the market • Steel: Andrew Carnegie sold his company to create U.S. Steel, the largest corporation in the world • Railroads: Men like Cornelius Vanderbilt controlled every train going in and out of a particular region of the country

10. Robber Barons or Captains of Industry? • Robber Barons: a term used to describe business leaders like Rockefeller or Carnegie who created large corporations and immense fortunes that harmed society through unfair business practices (like monopolies and trusts), political corruption, poor working conditions and slave wages for workers. • Captain of Industry: a term used to describe business leaders like Rockefeller or Carnegie who created large corporations and immense fortunes that benefited society in a positive way. Their contributions to societies well-being includes providing more jobs for workers, lowering the cost of products, and giving money to charity.

11. John D. Rockefeller (Oil) $318 Billion Andrew Carnegie (Steel) $298 Billion William Vanderbilt (Railroads) $261 Billion Jay Gould (Railroads) $68 Billion J.P. Morgan (Banking) $39 Billion Excessive Wealth??? Net worth of richest CEOs: Average annual income for a factory worker

12. The Gospel of Wealth Philanthropy: amount of money given to charity • 2,500 Libraries • Carnegie Hall (performing arts center) • Carnegie Peace Foundation • University of Chicago • Churches • Schools and Colleges • Restored Colonial Williamsburg • Donated land for national parks Ask yourself again: robber baron or captain of industry?

13. The Bradley-Martin Ball:The most expensive party in American history (and during a depression too!) Price Tag: 1897: $400,000 2010: $10 million