1.     Single proprietor

Single owner of a business--Weaknesses

1. Inability to raise large sums of $

2. Unlimited financial responsibility of the owners

3. Disruption of business on death of owner

2.     Corporation

Securing Capital:  Selling of Stocks and Bonds

Limited Liability:   liability ends w/resources of business

Perpetual Life: Business continues beyond owners death

3.     Monopoly

Following the Civil War Business combined businesses to control: prices, production, and sales territory to raise prices and profits.

4.     Trust

Companies formed a trust pool. Stockholders received trust certificates. The board of trustees of the trust effectively ran all the corps to control pricing.

5.     Pool

A secret agreement between companies to set prices output and wages.

6.     Growth of the Railroad

•          Abuses

1. High Rates

2. Discrimination among customers

3. Political corruption

7.     John D. Rockefeller: oil

Forms the Standard Oil Company of Ohio.  Accumulated cash, fought price wars, received secret rebates on RR, and drove out competitors and bought them out.  By 1879 controlled over 90% of oil refineries.

8.     Andrew Carnegie: steel

Andrew Carnegie ex Railroad executive:  Noted need for steel rails in railroads, used Bessemer process to make steel more effectively.  By 1900 Owned 25% of steel business. Bought out by J. Pierpont Morgan who created US Steel Company (60% of business).

9.     Henry Ford: auto

Henry Ford using the Assembly Line (system of mass manufacture) revolutionizes the US.

·      Mass industrialization begins

·      Creates the suburbs

·      Allows travel and recreation

10. Laissez-faire

Government does not interfere in business.  US official policy through most of the 19^th century until the populist and progressive movements.

11. Sherman Antitrust Act,

Made illegal trusts and other forms of restraint of trade.

This law languished w/little enforcement

Supreme court favored big business

Laissez Faire was the philosophy of the day

Vague wording

12. Knights of Labor

1869: Admitted all skilled and unskilled workers

Urged an 8 hour workday, abolition of child labor, and safer conditions

Decline of the Knights: Unsuccessful strikes, Tensions between skilled and unskilled workers, Haymarket Affair of 1886 (riot blamed on union)

13. AFL

AFL founded by Samuel Gompers 1881

Shunned political crusades, emphasized “bread and butter” unionism

Mostly skilled workers, made it more effective to strike

Created Craft unions (workers of same type all together)

14. CIO

1935:  Founded by AFL leaders (John L Lewis) who felt non-skilled workers needed representation.  Made up of unskilled and semi-skilled laborers Used the Sit-Down Strike

Pushed out of the AFL, became its own union w/ 5M members by 1950’s

1955: They merge to form the AFL-CIO.  About 100 unions w/ 13.5 M workers

15. Homestead Steel Strike

1892:  Workers at Carnegie Steel works had wages cut.  They fought w/300 Pinkerton detectives (hired thugs).  PA national guard called in.  Union ran out of resources and the strike ended.

16. Pullman Strike

Pullman Strike 1894:  Pay cut of 40% (w/out rent reduction at company controlled town).  American Railway Union led by Eugene V. Debs refused to handle Pullman cars to support the strike.  Attorney Gen Richard Olney (former railroad lawyer) put an injunction on strike that was ignored.  Debs went to jail and Pres. Cleveland sent in federal troops. 

17. Anthracite Strike

1902 UMW (United Mine Workers) struck for Union recognition, more pay and shorter hours.  President Roosevelt threatens to seize the mine, Gov arbitrates and gives higher wages, but no union recognition.

18. Tools of Labor

·      Strike

·      Picketing

·      Boycott

·      Publicity

·      Law (contract)

19. Tools of Management

·      Strikebreakers (Scabs):  hire workers to replace strikers

·      Financial Resources:  Corporations have deep pockets

·      Lockout: Keep workers from their jobs until they break the union

·      Injunction:  Court order to stop the strike.

20. Interstate Commerce Act, 1887

Prevented special rates or rebates

Prevented pooling

Rates needed to be “reasonable and just.”

Created federal commission ICC (Interstate Commerce Commission).

1^st step toward regulating monopolies

21. Grange Movement

The Patrons of Husbandry (1867)

Protest against railroads and storage fees (elevators)

Form Cooperatives to run their own elevators.

Granger Laws-passed by state legislatures

22. Social Darwinism

Application of Darwin’s (misquoted) idea of the survival of the fittest.  Strongest businesses and people will survive and the weakest will die. Late 19^th century concept.

23. Urbanization

•         Problems of Urbanization

1. Slums (ghettoes)

2. Increased crime

3. Disease

4. Poor public sanitation

5. Inadequate services (fire, police, water, garbage)

24. Child Labor

Laissez Faire Gov policy leads to underage workers and women being abused in factory systems.  Reform movements finally end this with the Progressive movement.