Aim: Does Industrialization benefit everyone?
Topic: Industrialism in America (late 1800’s)
Document #1: Introduction to Capitalism and its philosophies
Capitalism – an economic system based on private ownership of capital (property, money, resources
and technology). The goal of capitalism is for entrepreneurs (businessmen who bring together capital)
to make a profit.
Philosophies of the Industrialists
There were primarily three philosophies that drove America towards industrial greatness. Each of these
philosophies had Puritan values (values of individual responsibility and hard work) as their formation:
1. Laissez Faire Capitalism (Free Market Economy): This literally means “hands free” – no
government involvement (regulations, laws, taxes) involved in business. The idea is that
businesses want to make money, and they make money with competition with other businesses -by offering better paying jobs (getting better workers) than their competitors and then making
cheaper but better quality products than their competitors. Businesses know what is best for
businesses – not government. If the government gets involved, it costs business needed freedom
to pay or produce what they think is best and how they think it is best. The more government
lets businesses grow on their own, the better off the economy and society will be.
2. Rugged Individualism: This was the idea that it was an individual’s responsibility to help
himself (or herself). When down, one had to pick oneself and make something of one’s life.
There would be no government safety net programs or welfare. This philosophy created and
reinforced a hard work ethic.
3. Social Darwinism: This theory is built around competition mentioned earlier. Herbert Spencer
applied Charles Darwin’s theory about nature of “survival of the fittest” (that only the
strongest in nature survives) to humanity. It was the basic belief that those that deserved and
were strongest would become wealthy and the better companies and the weaker companies
deserved to fail. This applied to individuals as well – have a good work ethic so you do not
become poor.
1) Put Capitalism in your own words/what are the main ideas?
2) Put Laissez-Faire Capitalism in your own words/ what are the main ideas?
3) Put Rugged Individualism in your own words/what are the main ideas?
4) Put Social Darwinism in your own words/what are the main ideas?
5) Why is private ownership important to capitalism?
6)
Why is the concept of entrepreneurs making profit the fuel for capitalism?
7) How might these philosophies contribute to industrialization?
8) What is good about these philosophies?
9) What problems can these philosophies lead to?
Document #2: The main industrialists of the time were either known as Robber Barons or Captains of
industry based on how they contributed to the industrialization of America and their effects on society:
a) Captains of Industry: This term suggests that the business leaders served their nation in a
positive way. This view credits them with increasing the availability of goods by building factories,
raising productivity, and expanding markets. Furthermore, by creating more jobs, the industrialists
enabled many Americans to buy the new goods. They also founded and funded many of the nation’s
great museums, libraries and universities, many which still thrive today.
b) Robber Barron: This term suggests that the business leaders built their fortunes by stealing
from the public. According to this view, they drained the country of its natural resources and corrupted
public officials to interpret laws in their favor. At the same time, there industrialists ruthlessly drove their
competitors to ruin and paid low wages, while forcing their workers to work under the dangerous and
unhealthy conditions.
1) What are the differences between a captain of industry and robber baron? Explain.
2) Is it possible to interpret or view one person as both? Explain.
Case Study – Industrialists
Task: Read about each industrialist and then assess – is he a captain of industry or a robber
baron? Explain each in 3-4 sentences based on evidence in the readings.
A) Andrew Carnegie
Andrew Carnegie worked his way up from being a poor Scottish immigrant to becoming one of
America’s richest men. He started working in the textile industry at the age of 12. He worked his way
through a variety of jobs and invested money wisely. At the age of 38, Carnegie entered the steel
industry, which was booming because of the growth of railroads. Carnegie wanted control over all
aspects of steel making and built his company into the world’s largest steel maker (Carnegie Steel –
based in Pittsburg, Pennsylvania). Carnegie was also known for his philanthropy (effort to increase the
well being of human kind, done by charitable donations). Andrew Carnegie donated over $350 million
which led to the development of:
 Over 2800 libraries around the world
 Carnegie Museums of Art
 Carnegie Mellon University
 Carnegie Observatories
 Carnegie Hero Fund Commission
 Carnegie Hall
 Carnegie Science Centers
 And many other institutions and
foundations!
The Carnegie steel company was very profitable; it used the best, most efficient machinery and kept
wages very low. Carnegie’s workers earned very little. When salaries were cut at Carnegie’s Homestead
steel mill in Pennsylvania, the workers went on strike. Carnegie’s manager refused to talk to the strikers.
Instead, he sent in armed guards. Twenty workers were killed.
1) Is Andrew Carnegie a captain of industry or a robber baron?
B) John D. Rockefeller
John D. Rockefeller entered the oil refinery business during the Civil War and his company Standard Oil
(based in Cleveland and New York City) became the largest in the nation (and possibly the world). Like
Carnegie, Rockefeller was a philanthropist who donated large sums of his wealth to the development of
many charitable organizations and research centers:
 Rockefeller Institute for Medical Research
 University of Chicago
 General Board of Education for the Promotion of Learning (helped establish
quality schools for black and white students)
 Rockefeller Sanitary Commission
 Dozens of colleges and universities as well as churches and religious
organizations and local YMCAs
Rockefeller was considered one of the greatest villains of his time. His bookkeeper’s mind seemed
interested only in money and profits, not in people. When he put others out of business, it didn’t bother
him at all, as long as it made profits for the Standard Oil Company. That company is often referred to as
the “greatest, wisest, and meanest business in history.” Rockefeller soon had vast interests in many
businesses, not just oil, and the less he paid his workers the more efficient the businesses seemed. When
some workers tried to form a union, he lowered their wages and sent in guards to break up the strikes.
Many workers were shot and killed as a result.
1) Is Rockefeller a robber baron or captain of industry? Explain