Morill Act (agricultural colleges were built for new farming techniques/crops)
Morill Tariff (protected U.S. Manufactures against using foreign companies)
Pacific Railroad Act (gave railroad companies land grants to build the railroad)
Homestead Act (provided 150 acres of free land to farmers in the West)
National Banking Act (provided a national banking system using a charting system & national currency)

America Second Industrial Revolution

Spread of Railroads was the thing that paved the way for the Second American Industrial Revolution

Impact of Railroads on American Lifestyles

Need for uniformed time zones in country

Central, Pacific, and Eastern

Stimulus for iron, steel, and coal companies

Transportation of goods, people, and animals from one point to another

Cheaper form of transportation

Expanded farming and ranch industry

Shipped butchered animals in Chicago and ship to markets in Northeast

A Growing Population

Between 1860 to 1920, population TRIPLED

Rapid influx of European & Asian Immigrants
Demand for business growth
rising demand for goods and cheap labor
- Immigrants did undesired jobs
- Brought skills

Rise of Corporation

Corporation: Business chartered by federal or state government as a separate “person” and gave stocks to stockholders

Stocks: A share of the company that received a percentage of profit in dividends

Before the Civil War, businesses were owned by a small group or 1 individual

the death of the owner meant the closing of the business
owners are liable for debt of business

After the Civil War, corporations were on the rise and led to the entrepreneurial spirit that took over America

death of stockholder does not affect business
Debts of business are not the responsibility of the stockholder

Pros

Monopolies had a large scale of economics
A cheaper supply of resources
Efficient management

Cons

Monopolies had total control over the industry with no competitors
Monopolies could overcharge customers
Monopolies had no incentive to improve products

Entrepreneur

Entrepreneurs are those who take risks when engaging in business

Captains of Industry: those who innovate and lead the way for a certain industry

adopted new technology to make better/cheaper products for industry out of new corporations

Robber Barons: those who use harmful practices to make a profit

exploited workers
exercised monopolies over customers

Great Entrepreneurs of Gilded Age

Andrew Carnegie

Was the entrepreneur of the Steel Industry

Achievements:

Built major infrastructure around the U.S. (cities, bridges, & railroads)
Adopted the Bessemer Process from Britain and made it cheaper/faster than anyone else in the U.S.
Practiced Vertical Integration
Sold Carnegie Steel to J.P. Morgan in 1901
Became a philanthropist

John D. Rockefeller

Was the entrepreneur of the Oil industry

Achievements:

During Civil War, he invested in oil refineries to make a profit
Formed Standard Oil and took over 90% of U.S. oil refineries
Practiced Horizontal Integration
When Edison made the lightbulb, his business took a hit, since no one used oil lamps anymore, but had a comeback when oil was used to make gasoline for automobiles

Became a philanthropist

J.P. Morgan

Was the entrepreneur of the banking/finance industry

Achievements:

Helped Thomas Edison form Edison Electric Company in 1892
Kicked out Thomas Edison from Edison Electric Company when Tesla proved Edison wrong to make General Electric GE Company
Formed a commercial and banking institution called J.P. Morgan & Company in 1895,
Bought out Carnegie Steel to make U.S. Steel in 1901

Henry Flagler

Helped John D. Rockefeller expand oil refinement business
Built the Florida East Coast Railroads
Developed Florida
Built expensive hotels in Florida

Horizontal vs Vertical Integration

A person owns a single step in the industry

A person owns every step of the industry

Economic Depression

A prolonged business downturn with high rate of unemployment

In 1873, after the mania of laying down new railroads, many people started speculating and selling out their stocks and ended up causing an economic collapse

Monopolies

Many entrepreneurs like John D. Rockefeller and William Carnegie emerged and started to buyout the competition and drive them out of business

Falling prices and “cutthroat competition” (temporarily lowering prices to drive competitors out of business) made rival companies team up

So they could make a monopoly out of driving off competitors

Monopoly Disadvantages

Could overcharge
Companies had no need to improve products

Government

Reformers: people who fought for change

Due to laissez faire style of government, government was not supposed to interfere with business owners and employees or producers and buyers

Many business/corporation owners bribed government officials to break unions demanding for change

Reformers demanded government regulate “Big Business” and stop monopolies from forming

Anti-Trust Laws

Laws against Monopolies

Sherman Anti-Trust Law 1890: Combinations in “restraint of trade” are prohibited
Munn vs. Illinois - Supreme Court ruled that state could regulate businesses like railroads that are in the “public interest”
Wabash vs Illinois - The Supreme Court ruled that only Congress can regulate interstate commerce and states cannot regulate railroads
Interstate Commerce Act - established Interstate Commerce Committee and prohibited unfair railroad practices
- Railroad companies cannot charge more for shorter distance over long distances
- Railroad companies cannot charge different rates for same freight and same distance
- Cannot give rebates