Robber Barons vs . Captains of Industry

Robber Barons vs. Captains of Industry

-Pros and Cons of Industrialists-Treatment of workers-Antitrust Movement

Captains of Industry

I created jobs

I helped make life easier for you

We make all those nice things you

like!

We made this country an

empireI provide

affordable products

If you work hard you

can be rich too!

Robber Barons

I gamble with the

taxpayers money

You work for pennies while I make millions

The people you vote for work for meI get

government bailouts…

Corporations are people and have rights---

right?

We started corporations

Opposing View Points

• Captains of Industry– Created Jobs– Increased production– Provided cheap

products– Gave money back to the

community– Helped build the nation

• Robber Barons– Exploited workers– Corrupted the

government– Greedy– Offered bribes for

political favors– Above the law

Corporations are people????

• A corporation: – Is owned by many

people (stockholders)– But treated as a single

entity– It can

• Own property• Pay taxes• Sue or be sued• Make contracts

Corporations• Stocks– Shares of a corporations

• Share risk and reward

• Stockholder– People who own a corporations via

stocks• Buying/Selling STOCKS allows

corporations to expand/increase– Production– Employees– Factory– Research & Development

Corporations

• More money brings– New technologies– More workers– New machines– Bigger factories

• Economies of Scale– Corporation can make

more goods at a lower cost….passing the saving on to you

CostsFixed• Money that you have

to pay regardless if your business goes or not…– Loans– Mortgages– Taxes– Rent

Operating• Money used to make your

business GO!!!– Water– Electricity– Employees– Shipping– Wages– Materials

POOLS• An affiliation of two or

more people/companies formed for the purpose of attempting to manipulate a products price and/or volume.

– = gas station

$

$

$

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Vertical Integration

• Corporation owns all of the companies which it depends on to improve profits. Cut out the profit margins of “middle man” companies.

• Ex. McDonalds

Horizontal Integration

• Combining or merging LIKE companies into one LARGE company.

• Ex…Blockbuster Video

Monopoly• Exclusive control of a product or service in a particular market that makes it possible to manipulate prices.

TRUSTS

• an organization of businesses designed to operate like a monopoly to circumvent anti-monopoly laws

BIG OIL

Trustee 1 Joe’s Oil

Trustee 2Bill’s Oil

Trustee 3Juan’s Oil

$$$ $$$

Holding Companies• Corporation that

doesn’t really do anything except own a significant amount of stock in real companies.

• Board of Directors• CEOs

Cutting Costs• Skilled Workers replaced by

Unskilled machine operators.– Production cost lower

• Deflation = profits• Value of $ rises• Prices drop• Workers wage has more buying

power

• Terrible working conditions• Unsafe• Unsanitary• Long hours• Low wages

$10 a day

$3 a day

Workers Unite– TRADE UNIONS- Limited

to Skilled Laborers• Iron workers• Shoemakers

– Industrial Unions- Common Laborers and craft Workers• Carpenters• Painters• artisans

Workers Organize

Knights of Labor – formed in 1869 as the first labor

union in the nation.

Goal #1:Shorter work day

Goal #2:End child labor

Goal #4:Worker owned

factories

Goal #3:Equal pay for men

and women

Strikes

boycotts

arbitration

Blacklisted– Anyone that tried to start a

union considered a troublemaker.

– Could not get a job anywhere

– Had to • Move• Change Name • Change Identity

LOCKOUT

• COMPANY ANSWER TO STRIKE– NO PAY– NO WORK– HIRE REPLACEMENT

WORKERS• “STRIKE BREAKERS”

– SCABS

STRIKES• Workers walk off the

job & protest working conditions

• Early Strikes resulted in Violent Riots

• Government normally sided with Business because they shared similar interest in companies making a profit

• Pullman Strikes• Great Rail Road Strike• Haymarket Riots

• American Federation of Labor (AFL)•umbrella organization made up of many different trade unions.•Led by Samuel Gompers•Unions stay out of Politics•Closed Shops- Companies only hire Union Workers

A F L

Screen Actors Guild

American Postal Workers Union

American Federation of Teachers

United Steel Workers of America

United Farm Workers of America

International Association of Firefighters

Unions of the AFL - CIO

Justifications for Industrialists’ Extreme Wealth

• Social Darwinism• Herbert Spencer

– Based on Charles Darwin’s theory of evolution

– Those who are rich are more fit, than those who are poor

– Attempted to use science to explain social classes

• Gospel of Wealth• Andrew Carnegie

– God gave wealth to the most capable people

– It is the duty of the wealthy to give money to help the poor • Carnegie gave millions of

dollars away to establish libraries, colleges, and museums

Captains of Industry

• Andrew Carnegie- US Steel• J. P. Morgan- Banking, and Insurance

Companies• John Rockefeller – Standard Oil• Cornelius Vanderbilt- Rail Roads