The Rise of American Business, Industry, and
Labor (1865 - 1920)
• Civil War changed
everything!
• North was already
industrializing (bullets,
railroads, etc)
• South was ruined!
 (NEW SOUTH)
RAILROADS!!!!!
Before the Civil War….
• …most businesses
were sole
proprietorships
(single owners).
 Factories need more
start-up capital($$)
then a single person
business.
 The birth of
corporations!
 What is a corporation?
What do these terms mean? (homework)
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1) Monopoly
2) Conglomerate
3) Merger
4) Trust
5) Holding Company
6) Capitalism
7) Communism
8) Entrepreneurs
•9) Laissez-Faire
•10) Social Darwinism
•11) Robber Barons
•12) Philanthropists
•13) Labor Union
•14) Collective Bargaining
•15 Sherman Antitrust Act
Entrepreneurs!
• Andrew Carnegie
• John D. Rockefeller
• J.P Morgan
• Henry Ford
Entrepreneurs!
• Andrew Carnegie
 Scottish Immigrant who
started working in a factory at
age 12.
 Invested wisely and entered
the steel industry at age 38.
 By 1901 sold his steel
company for $250,000,000!
 Gave hundreds of millions to
charities (libraries)
 Wrote the book: Gospel of
Wealth
Entrepreneurs!
• John D. Rockefeller
 Entered the oil-refining business
during the Civil War.
 Used ruthless means to eliminate
his competition.
 By 1882 his company, Standard
Oil Company, controlled 90% of all
American oil refining.
 Created the Standard Oil Trust to
control more aspects of oil
production.
 Gave hundreds of millions to
charities.
 Rockefeller Center
Entrepreneurs!
• J.P Morgan
 Banker who made many
loans to up and coming
businesses.
 Purchased and
reorganized many bankrupt
businesses (profit).
 Bought Carnegie Steel and
reorganized it into the
United States Steel
Corporation (the world’s
largest).
Entrepreneurs!
• Henry Ford
 Ford Motor Corp
(cars)
 Created the
assembly line
 Paid laborers a
good wage
Laissez-Faire (hands off)
• The government largely
kept “hands off” towards
American business.
 Businesses were
booming! The
economy was doing
well. Foreign trade
reached new heights.
 Why did this change
around the end of the
1800’s?
HANDS ON
• Why?
 1) The economy took a turn
for the worse
 2) Growing criticism that
big business made profits
on the backs of the
American poor/immigrant
 3) Growing political
pressure for change
RAILROADS!!! (again)
• In the late 1800’s, railroads
developed a number of
business practices that hurt
farmers and small businesses
(pricing).
 These small business lobbied
to have the government
change these policies.
 Railroads lobbied to allow
them to stay the same
Please research the following Supreme
Court Cases from this era:
(homework)
1) Munn v. Illinois (1877)
2) Wabash, St. Louis &
Pacific Railway v. Illinois
(1886)
3) United States v. E.C.
Knight Company (1895)
4) In re Debs (1895)
RAILROADS!!! (again)
• List several reasons why
railroads were so important to
so many people.
• What was it about railroads?
How did they effect American
society?
• How did railroads effect other
businesses? Did railroads
create a market for other
businesses? Like what?
Public Pressure: ICC
• Public pressure
forced Congress to
pass the Interstate
Commerce Act
 Created the ICC
which regulated
railroads and
ended abuses like
rebates.
 (precedent)
Public Pressure: Sherman
• Late 1800’s: some business
had no competition (monopoly)
 Public outcry was
significant
 Politicians passed the
Sherman Antitrust Act
(see vocabulary)
 Business combination
Illegal: “in restraint of
trade or commerce”
 US v. E.C. Knight
Company
 Precedent
Labor Rising
• Conditions for working people
had slowly improved with time
 However, wages were still
low,unemployment was
uncertain and could end
suddenly.
 Business owners had
tremendous power over
employees!
Labor Rising
• Union Tools:
 Collective Bargaining
 Strikes
 Pickets
Knights of Labor
• Formed in 1869 - Terence
Powderly
• Haymaker Riot ended their
influence in 1886
• Welcome skilled, unskilled,
and African-Americans
• Fought for broad social
reforms
 8 hour work day
 end to child labor
 equal opportunities for
women
American Federation of Labor
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AFL - Samuel Gompers
1886
A collection of craft unions.
Fought for “bread and butter”
issues
 Higher wages, better hours,
better working conditions
• Extremely powerful with
over 1,000,000 members by
1900
Labor Conflict
• Describe the following events
for homework:
 Great Railway Strike of 1877
 Haymaker Riot
 Homestead Strike
 Pullman Strike
Give details, who - what - when
- why - results?
Great Railway Strike of 1877
Great Railway Strike of 1877
- Railroad workers went on
strike after several pay cuts.
(several states)
- President Rutherford B. Hayes
sent federal troops to end the
strike
- Workers got very little
Haymaker Riot
Haymaker Riot
-
Labor Rally (organized by
Knights of Labor) that ended in
a bomb blast
- 7 police died
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Chicago
1886
Public blamed Knights of
Labor despite the fact they had
nothing to do with the violence.
Homestead Strike
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Homestead Strike
1892 - Union members
went on strike (pay cuts) at
the Carnegie steel plant
Homestead, Pennsylvania
Violence ensued
16 people died- fewer then
25% of the strikers got their
jobs back
Set the steel labor
movement back 20 years
Pullman Strike
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Pullman Strike
1894 - Railroad workers
went on strike in Illinois
Tied up other rail lines.
President Grover
Cleveland sent in troops
to end the strike
In re Debs