Industrial and Business
Leaders of the 1800s
NCSCOS 5.02
AP USH Unit 15
Macro Concepts
Conflict-problem or issue that is
controversial and can cause
problems without compromise
Change-the transformation of a
person, place or thing.
Innovation-improvement and
advancement in the way
something is done.
Power-the authority of a
government to carry out the
law.
Micro Concepts
Supply and Demand-The belief that
the amount of an item and
people’s desire for it will
influence the price.
Laissez Faire-the belief that the
government should leave
businesses alone.
Social Darwinism-Belief that
certain people are born superior
than others. People are
successful because they earned
it and unsuccessful people did
not.
Monopoly-type of business that
runs its competition out of
business and takes over the
entire industry.
Vertical integration-a strategy used
by business to control every
aspect of production.
Horizontal integration-another term
for monopoly.
Gilded Age
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Time period from 1870-1910 when a small number of Americans became
extremely wealthy due to their exploitation of Laissez Faire policies of the
U.S. Government.
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Railroads, The Steel industry and Oil companies controlled their business
sectors with complete control.
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Competition between businesses was limited and prices of goods were very
high.
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There was a huge disparity [difference] between the rich and poor.
The decadent
Biltmore Estate
in Asheville, NC
Captains of Industry
 These were business owners who were ruthless and did everything they
could to be financially successful by controlling their types of business.
They were called captains of industry as a result of their tactics.
 These men became very wealthy and powerful because they controlled
huge amounts of money.
Robber Barons
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Robber barons were business owners who sometimes broke the law
or twisted rules to their advantage in order to make huge amounts of
money.
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They controlled the wealth of the United States by “stealing” money
from citizens with exorbitant pricing.
Thomas Nast’s cartoons
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A New York City cartoonist named Thomas Nast criticized the
corruption and illegal activities of Tweed and other government
officials.
His cartoons were so effective because readers did not have to
know how to read to understand what Nast was describing.
Eventually the pressure applied by Nast led to Tweed’s arrest,
prosecution and imprisonment.
Edwin Drake
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Drake was the first American to
successfully drill for and find
significant oil in the United States.
He discovered oil in Pennsylvania and
refined it into kerosene.
Kerosene was originally used for lamp
fuel.
Because of his discovery other people
later drilled for oil and eventually also
became very wealthy.
This discovery led to the vast
expansion of oil exploration and the
energy to fuel motorized engines.
Andrew Carnegie, Bessemer Process and U.S. Steel
•
Carnegie was a Scottish immigrant who
was very poor when he arrived in the
United States.
•
He worked his way up to owner of U.S.
Steel Corporation which later became a
monopoly in the steel business.
•
Carnegie was shown the Bessemer
process by a chemist who demonstrated
how to create high quality steel for
military weapons.
•
The Bessemer process enabled him to
make super strong steel in a quick
manner using oxidation [air blown
through molten steel]. The cost of steel
production plunged and increased profits.
•
He also used a business strategy called
vertical integration which combined
every part of the steel business in order
to make higher profits.
The Gospel of Wealth
 Not all wealthy business owners were bad!
 Andrew Carnegie, a robber baron, gave away almost all of his money
before he died.
 He believed dying wealthy was a type of crime according to an essay
written by Andrew Carnegie.
 His financial gifts funded public libraries and museums across America.
 Therefore, according to Carnegie, the wealthy had a responsibility to do
good with their money through philanthropy.
 Philanthropy is the act donating or giving money away to charities and
needy causes to improve the public good.
J.P. Morgan
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Railroad and banking tycoon
who financed numerous
businesses and formed banking
trusts
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He cleverly acquired ownership
in companies that were often
considered unfair.
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He purchased U.S. Steel
Corporation from Carnegie for
$400 million
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He often forced companies to
dissolve when profits were
siphoned off [workers lost jobs]
John D. Rockefeller and Standard Oil
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Rockefeller built on the success of Drake
and went into the oil business.
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Because of the invention of cars and the
use of gasoline Rockefeller became
very wealthy.
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Rockefeller used a business strategy
called horizontal integration to
consolidate other businesses by taking
them over.
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He was then able to create a monopoly
and charge whatever he wanted to.
Vanderbilt Family
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The Vanderbilt family of New York dominated the railroad industry.
The ruthless Vanderbilt family was well known for charging high fees for
shipping freight.
They were also well known for bribing members of the U.S. government
in order to get laws passed that would favor their business interests.
The Interstate Commerce Act greatly reduced the power of the railroads.
Herbert Spencer
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Some people believed the reason people
were rich was because they were
smarter.
Nature favored much as the British
Naturalist Charles Darwin thought it
favored stronger creatures.
Poor people deserved their poverty
because they were inferior according to
the theory of Social Darwinism.
This concept of Social Darwinism was
used by the Robber Barons as
justification of their wealth.
Horatio Alger
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Horatio Alger wrote a
series of inspirational
novels telling various rags
to riches tales.
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The stories focused on
how kids from
impoverished beginnings
were able to pull
themselves up by their
bootstraps.
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Very few of these stories
were real but they offered
hope for future success.
Writing Assignment: Write a one page letter [if typed 12 pt
Arial font, if handwritten one side of a page] in either of the two
points of view below.
 Write a letter to the U.S. Government complaining
about one of the robber barons [what do you want
to be done?]
or
 Write a letter to the person [robber baron/captain of
industry] complementing him about what he was
able to accomplish?
Extra Credit
 Write a one page rags to riches story
about an immigrant who makes good and
goes from very poor to very successful
just like Andrew Carnegie or a character
such as Raggedy Dick.
Image sources
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http://www.1892biltmorevillageinn.com/Pictures/Biltmore%20Estate.jpg
http://notsodismal.com/wp-content/uploads/2009/03/84comm6jpg.jpeg
http://explorepahistory.com/images/ExplorePAHistory-a0b6s6-a_349.jpg
http://en.wikipedia.org/wiki/File:Andrew_Carnegie,_threequarter_length_portrait,_seated,_facing_slightly_left,_1913-crop.jpg
http://en.wikipedia.org/wiki/File:5051_Earl_Bathurst_Cocklewood_Harbour.jpg
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http://en.wikipedia.org/wiki/File:George_Westinghouse.jpg
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http://en.wikipedia.org/wiki/File:Westinghouse_Air_Brake_control_handle_and_valve.jpg
http://explorepahistory.com/images/ExplorePAHistory-a0m4y1-a_349.jpg
http://www.power-of-giving.com/images/philanthropy-1.jpg
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