Big Business and Its Leaders American History 12.3 & 12.4

Big Business and Its Leaders

American History 12.3 & 12.4

Big Business

• Corporations – a company owned by many people through shares

• Stock – shares• Economies of Scale• Development of Pools

JOHN D ROCKAFELLER

Andrew Carnagie

Andrew Carnegie

• Steel Tycoon• Rags to riches• Henry Bessemer (High quality steel cheaper)– Bessemer Process

• Used Vertical Integration

John D Rockefeller

• Standard Oil: Oil refineries• Horizontal Integration: Combined firms in the

same business into one large cooperation• Monopoly – 90% of all oil refineries owned by

Rocefeller

New Business Organizations

• Trusts formed in response to states making monopolies illegal– Legal arrangement allows one person to manage

another persons property• Holding Companies: doesn’t produce anything

itself but owns stock in companies that do• Investment Banking

Horizontal Integration

Early Unions

• Trade Unions– Usually succeeded in negotiating

• Industry Unions– Hated by Business leaders

• Blacklist– Used to punish workers who went on strike

• “Lockouts”

Thoughts on Unions

• Employer's – Viewed unions as trouble makers– Interfered with property rights

• Marxism– Workers should own their own labor– Seen as Un-American

Knights of Labor

• Use boycotts instead of strikes• Supported arbitration• Welcomed Women and African American

Homestead Strikes

• Used the Pinkertons• Steel Mill owed by Andrew Carnegie

Haymarket Riot

• Nation wide strike for 8 hour working day • Anarchist group protests shooting by police• Bombing, kills 6 police officers• Critics blame unions

Pullman Strikes

• American Railway Union (ARU)• Strike on Gorge Pullman Rail Road Company

Town• ARU around the country support the Pullman

Strikers• Attached mail cars to Pullman cars• Interjection: Court order ending boycott