Ch 14 Sec 1-3

Gilded Age

Ch 14 Sec 2

Realizing that railroads were critical to the settlement of the West and the development of the nation, the federal

government made huge land grants and loans to the railroad companies.

The Age of the Railroads

Benefits• The railroad companies

built transcontinental and local lines.

• transformed country from collection of regions into a united nation

• Railroad time became the nation’s standard time

Drawbacks• The unchecked power and

greed of the railroad companies led to widespread corruption and abuse of power

The Age of the RailroadsWhich problems did employees of the

railroad companies face

• Life-threatening working conditions, low pay, and discrimination (Chinese Exclusion Act)

What was it like to live as a Pullman employee in the town of Pullman?

• A clean safe environment, but too controlling, since residents had no say in the town rules

The Age of the RailroadsWho was involved in Credit Mobilier, and what was the purpose of this company?

• Railroad magnates, stockholders, and federal officials in the Union Pacific Railroad siphoned off railroad profits for themselves

In what ways did the railroad companies use their power to hurt farmers?

• Sold land grants to other businesses instead of settlers

• Fixed prices to keep farmers in debt to them

The Age of the RailroadsWhy didn’t the decision in the Munn v. Illinois

case succeed in checking the power of the railroads?

• Ruled that a state could not set rates on interstate commerce (ICC is created)

Why didn’t the Interstate Commerce Act immediately limit the power of the railroads?

• ICC was hampered by long legal battles from the railroads

• Supreme Court ruled that the ICC couldn’t set limits on rates

Fun Facts

• Ice Cream is Chinese food!• It takes a drop of ocean water more than

1,000 years to circulate around the world.• Check your map! Virginia extends farther west

than West Virginia.• The water of the Antarctica is so cold that

nothing can rot there.

Big Business and Labor

Ch 14 Sec 3

Industrialism Quotes • “Rights and interests of the laboring man will be protected

and cared for ------ not by the agitators, but by the Christian men to whom God has given control of the property interests of the country”

George F. BaerPresident of a

mining company

• “I regard my workers as I regard my machinery. So long as they do my work for what I choose to pay them, I keep them, getting out of them all I can”

Factory Owner

Capitalism

What is the difference between a “mom and pop” business and “big business”

Vertical Integration

What is it?• The process by which a

company buys out all its suppliers

How did it help businesses such as U.S. Steel and Andrew Carnegie?

• Gave a company total power over the quality and cost of its product and helped to create Monopolies

Horizontal Integration

What is it?• The process in which a

company buys out, or merges with, its competitors

How did it help businesses such as U.S. Steel and Andrew Carnegie?

• Gave a company control over its competition and helped create a Monopoly

Social Darwinism

What is it?• An economic theory based

on Darwin’s theory of biological evolution

• It asserted that free competition would ensure success or failure in business

How did it help businesses such as U.S. Steel and Andrew Carnegie?

• Glorified big business and tycoons

• Discouraged government interference with big business

• To fight against big business, workers created unions like

• An example is the AFL (for only skilled laborers)

Monopoly

What is it?• Complete control over an

industry’s production, quality, wages, and prices

How did it help businesses such as U.S. Steel and Andrew Carnegie?

• Eliminated a company’s competition allowing it to increase profits

Holding Company

What is it?• A corporation that does

nothing but buy out stock of other companies

How did it help businesses such as U.S. Steel and Andrew Carnegie?

• Helped get control of companies and create monopolies

Trust

What is it?• A large corporation made

up of many companies that receive certificates entitling them to dividends on profits earned by all the companies combined

How did it help businesses such as U.S. Steel and Andrew Carnegie?

• Helped create monopolies (This is how Rockefeller gained control of Standard Oil)

How did it harm businesses such as Standard Oil and tycoons like John D. Rockefeller

• The perception of tycoons as “Robber Barons”

• Put tycoons on the defensive

• Turned public opinion against them and their businesses

• Encouraged government regulation

How did it harm businesses such as Standard Oil and tycoons like John D. Rockefeller

• Sherman Antitrust Act • Made trusts (and monopolies) illegal in interstate and international trade

• Made it possible (but not easy) to prosecute companies

• To promote fair industrial competition

Standard Oil P.C.