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Cards In This Set
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Who was Andrew Carnegie?
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- one of the 1st industrial giants
-formed Carnegie Steel Company (US STEEL)
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What business practices made Carnegie successful? (name 4)
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1. found ways to make products better and cheaper
2. machinery and techniques helped tracked production costs therefore could analyze how to cut costs
3. offered stock to employees
4. encouraged competition among assistants
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What was Vertical Integration?
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When a company controlls as much of their industry as possible therefore elinimating competition (Andrew Carnagie and steel companies)
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What was Horizontal integration?
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-controlling all the resources
-controlling all transportation
-buying out competitors
TOTAL CONTROL------MONOLOPY
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What was Social Darwanism?
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1. Based on Darwin' idea of survival of the fittest-"natural selection"
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How did economists use the idea of Social Darwanism to just their economic policy of laissez faire?
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-thinking was market should not be regulated by the fed govt.
-should be governed by natural law so no one had the right to interfer
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Why was the philosophy of Social Darwanism supported by Americans? (3 reasons)
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1. supported American idea of personal responsiblity and blame
2. supported American work ethic that went back to Puritan beliefs
3. being rich was a sign of God's favor
REALLY GOES BACK TO THE IDEA OF THE FOUNDERS OF AMERICA
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Who was John D. Rockefeller?
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-founder of Standard Oil company
-used trusts to gain control of the oil industry and create a monopoly
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How did John D. Rockefeller corrup the trust system for his own gain?
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1. this allowed him to take control of over 90 % of oil business within 10 years
2. controlled industry so could pay employees low wages
3. therefore kept cost low and could sell his oil cheaper
4. therefore put his competitors out of business
5. once he controlled oil business hiked prices back up and made LOTS of money
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What was a trust?
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-when all involved turn over stocks to a board of trustees
-this allowed the board to fun everything as 1 company (or corporation)
-then all companies within trust got profits
-illegal
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What was a holding company?
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-a corporation that only bought out stocks of other companies
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What was a merger?
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-when one corporation bought out stocks of another coorporation.
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What is one way to create a Monopoly?
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-set up a holiding company
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How did Rockefeller use his money to help people? PHILANTHOPHY
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1. gave away over 500 million
2. extablish the Rockefeller Foundation
3. funded the Univesity of Chicago
4. created a medical institution to cure yellow fever
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What was the Sherman Anititrust Act?
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-passed because govt was afraid that expanding corporations would have a negative impact on free competition
-made it illegal to for a trust that interferred with trade between states and other countries
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