Unit 6: Response to Industrial America Flashcards
An economic system that is characterized by private ownership of property and the use of that property to make a profit for the individual or the corporation acting as an individual
Capitalism
What does capitalism support?
The democratic ideal of individual freedom and opportunity
The combination of one or more companies
Mergers
When a company is the only provider of a good or service
Monopolies
Early in the Industrial Revolution, critics began to what?
They began to question the compatibility of large, unchecked corporations and the rights of workers and consumers in a democracy
What was the economic engine that drove the economy?
The railroad
The establishment of several transcontinental routes led to the…
development of national market
Where were new towns grown?
along the railroads
Where were older towns?
were able to specialize in particular products
Why were some railroads forced to merge with others to survive?
Due to competition
The national economy was thrown into what when the cut-throat competition drove some railroad companies into bankruptcy?
Depression
What were some of the important entrepreneurs also known as?
Robber Barrons
What did Carnegie develop?
the Bessemer process to mass produce steel
What did Carnegie use to create a monopoly over the steel industry?
Vertical Integration
The practice of owning all the means of production to keep costs down
Vertical Integration
Who undersold the market until he drove his competition out and then increased the price of oil?
John D. Rockefeller
Who began the business strategy known as “Trust” to gain control of the oil refining industry through a horizontal integration?
John D. Rockefeller
A combination of firms or corporations formed by a legal agreement (to reduce competition)
Trust
When one company takes over and controls all competing companies
Horizontal Integration
What two ideas justify the business practices of the Robber Barons?
Social Darwinism and Laissez Faire
The best, strongest countries, people and companies deserve to overcome weaker ones for the betterment of society
Social Darwinism
The economy will flourish naturally with the least amount of government regulation
Lasissez-Faire (hands off)
How did the government protect the practices of the capitalists?
Through high tariffs and pro-management/ anti-labor legislation
How did Andrew Carnegie improved his public image?
With his advocacy of the Gospel of Wealth and gave away millions to libraries and universities
The idea that the wealthy had a moral obligation to provide for the less
Gospel of Wealth
What did unchecked competition lead to?
economic uncertainty and periodic recessions and eventually to a public call for gov. regulation of monopolistic practices
Prohibited monopolies and allowed the federal government to investigate companies suspected of violating antitrust laws
The Sherman Antitrust Act
True or False: Mass production lowered the price of goods
True
Why did farmers and factory workers not enjoy the improved standard of living?
Because of low prices for their crops and low wages for their labor
Effects of the industrial revolution
rise in the standard of living and new consumer products for many Americans
What does the Farmers give rise to when they unite to address their economic problems
The Populist Movement
What does the farmers get in the vicious economic cycle of?
as prices for crops fell, they earned less, so they bought more land in order to produce more crops and pay off debts.
What caused prices of crops to fall dramatically?
Overproduction
Who started a group called the Grange?
Oliver Hudson Kelley
What was the purpose of the Grange?
It was a way to educate farmers on how to organize politically, fight against railroad power, and how interest rates work.
- Prohibited railroads from charging more for short hauls or Long hauls on the same route
- was designed to regulate all interstate commerce
Interstate Commerce Act of 1887
Movement of the people; wanted economic and political reforms
Populism
What did the Populist party want ECONOMIC wise?
increase money supply, graduated income tax, federal loans
What did the Populist Party want POLITICAL wise?
Senate elected by popular vote, secret ballot, a low requiring an 8-hour work day
Describe the Economic Panic of 1863
Many railroads had expanded faster than the markets they were intended to serve. A lack of economic activity led many railroad companies to go bankrupt
Monetary system using both silver and gold to back currency
Bimetalism
Bimetallism would create more money and stimulate the economy
Silverites
Backing currency with gold only
Gold standard
Gold only would create a more stable economy
Gold bugs
In 1896, Republicans commit to (gold/silver) and select (William McKinley/William Jennings Bryan)
Gold, William McKinley
Who favored bimetalism?
Democrats
Who chose William Jennings Bryan?
Democrats
Who delivered the famous “Cross of Gold” speech but fails to sway enough voters
William Jennings Bryan
In 1896, who was elected as president?
McKinley
What legacy does populism leave?
The powerless can organize an have political impact.
