TheRiseofBigBusiness

The Gilded Age I.  The Gilded Age = time period dominated by big

business, political corruption and extremes of wealth and poverty.

A.  Gilded = covered with gold but cheap/trash underneath

II.  The United States experienced an economic shift

from a predominantly rural agricultural nation to an urban industrial one.

III. Industrialization will lead the U.S.A. to

obtain wealth and power like never before

Major Developments

I.  During the Gilded Age The United States of America changed in three major ways:

A.  Industrialization - industrial production

B.  Urbanization – Americans moved to cities

C.  Immigration – people moved to the USA from other nations

The Way We Were in The Gilded Age: 1877-1901 Who We Were How We Lived

1880 1890 1900 1880 1890 1900 Population (millions) 50.2 63.0 76.0 Gallon of

milk $0.16 $0.17 $0.30 Pop. per sq. mile 16.9 21.2 25.6 Loaf of

bread $0.02 $0.02 $0.03 Percent rural 71.8% 64.9% 60.4% New

auto N/A N/A $500 Percent urban 28.2% 35.1% 39.6% Gallon of

gas N/A N/A $0.05 Percent native born 94.4% 87.1% 84.4% New

house $4,500 $5,800 $4,000 Percent immigrant 5.6% 12.9% 15.6% Average

income $480 $660 $637

 

TheGildedAge

I.  ModernAmericadevelopedduringtheGildedAgeII.  TheGildedAgeistheageofexcess (too much)

A.  BigbusinessB.  BiglaborC.  Bigci>esD.  Biggovernment

III.  TechnologicalprogressallowedtheUSAtoshiCtoamodernindustrialna>on

America’sSecondIndustrialRevolu>on

I.  America’sindustrializa>onwasonlypossiblethankstonewtechnologies:A.  Electricity,steamship,railways,Bessemer

furnace(steel),machinetools,assemblylineII.  Industrializa>onalsoneeded:A.  Rawmaterials,largelaborforce,industrial

entrepreneurs,growingmarkets,laissez-faireeconomics

Businessgetsbig

Laissez-Faire(handsoff) I.  Laissez-faireeconomics=the

governmentlargelykept“handsoff”towardsAmericanbusiness.A.  TheAmericangovernmentdid

nothingtocontrolbigbusinessesintheUSA

B.  BusinesseshadnorulestofollowandoCendidthingsgoodforprofitsbutbadforconsumers

II.  Laissez-faireeconomics

allowed“BigBusinesses”toform

SOCIALDARWINISMI.  Thepolicy/ideaofSocial

Darwinism=inbusinessitshouldbesurvivalofthefiYest

II.  Onlystrongbusinessessurviveandweakonesshouldgooutofbusiness

III.  Thewealthiestmenandthebiggestcompanieswillhavetheallthecontrol

BusinessGrowthI.  Bigbusinessesbeganusingtwonew

businessstrategiesinordertomaximizeprofits

II.   Ver&calintegra&on=controlofeverystepinproduc>onprocessbyonecompany

A.  Companies would buy all the suppliers in one industry and keep other companies from purchasing raw materials needed to make a product

III.   Horizontalintegra&on=controlofthemarketforasingleproductbyasinglecompany

A.  Buying all businesses in the same market so one company controls the entire market (monopoly)

I.  Both methods of integration allowed big businesses to form in the USA à drove competing businesses out

II. Businesses created monopolies leading big businesses to grow even bigger

BigbusinessneedsRR

I.  RailroadswerenecessaryforthedevelopmentofbigbusinessestoformA.  RRTiedsprawlingna>ontogetherB.  RROpenedthecountrytoexpansion

II.   RRalsoprovidedcommercialassistancetobigbusinessesA.  BroughtrawmaterialstomanufacturersB.  Tookfinishedgoodstoconsumers

III. WithoutRRbigbusinesseswouldnotbeabletoformintheUSA

BigBusiness

I.  BigbusinessestookrootintheUSAduringtheGildedAge

II.  BigBusinesseswereallowedtogrowthanksto:A.  SocialDarwinism,Laissez-faireeconomics,Ver>cal&

HorizontalIntegra>on,Trusts,HoldingCompanies

III.  BusinesseswillgrowbiggerandbiggerintheUSAandtakemorecontrolofthepeopleandgovernmentintheprocess

AREYOUWITHME??

① WhatwerethethreemajorshiCsthatoccurredinAmericansocietyduringtheGildedAge?

② WhatwastheeconomicshiCthatoccurredintheUSAduringtheGildedAge?

③ Howdidlaissez-faireeconomics&SocialDarwinismallowbusinessestogrowrapidly?

④ Explainthedifferencebetweenver>calandhorizontalintegra>onduringtheGildedAge