Trusts and monopolies study guide

What is vertical integration?

A business controls every aspect of the production process.

Who pioneered vertical integration?

Andrew Carnegie.

What process did Carnegie utilize to improve steel production?

The Bessemer process.

What was the goal of vertical integration?

To improve efficiency, control product quality, and eliminate middlemen's fees.

What percentage of the nation's Bessemer steel was produced by Carnegie by 1890?

About ¼ of the nation's Bessemer steel.

What is horizontal integration?

A business buys out competitors to monopolize a given market.

Who pioneered the trust system?

John D. Rockefeller.

What company did Rockefeller use to control competition?

Standard Oil Company.

What was the outcome of Rockefeller's control over oil refineries by 1877?

He controlled 95% of oil refineries in the U.S.

What was the value of Rockefeller's company upon his retirement in 1897?

$900 million.

What are interlocking directorates?

A system organized by J.P. Morgan to control multiple companies through shared board members.

What was the significance of the United States Steel Corporation?

It was America's first billion-dollar corporation formed in 1901.

What term describes the acquisition and restoration of struggling companies?

Morganization.

What social class emerged during the Second Industrial Revolution?

The Nouveau Riche, or new super-rich leisure class.

What criticism was directed at the Nouveau Riche?

They were labeled as 'robber barons' due to their conspicuous consumption.

Who advocated Social Darwinism?

Herbert Spencer.

What does Social Darwinism justify?

It justifies social inequalities as a natural law of survival of the fittest.

What was Andrew Carnegie's stance on wealth distribution?

Wealth should be donated for the public good.

What did Carnegie criticize about the Nouveau Riche?

Their flaunting of wealth without philanthropy.

What was the National Labor Union?

The first major attempt at forming a national union, organized in 1866.

What was the Great Railroad Strike of 1877?

The first nationwide strike that paralyzed railroads and involved 100,000 workers.

Who led the Knights of Labor?

Terrence Powderly.

What was the goal of the Knights of Labor?

To include all workers in one big union and fight for an 8-hour workday.

What event led to the decline of the Knights of Labor?

The Haymarket Square bombing in 1886.

What happened during the Haymarket Square bombing?

A dynamite bomb killed 8 policemen and injured many others during a protest.

What was the response of the government to labor strikes?

Federal troops were often called in to suppress strikes.

What did employers use to prevent unionization?

Ironclad oaths and yellow dog contracts.

What was the public perception of the wealthy during this period?

Many saw them as morally corrupt due to their wealth and business practices.