Ch. 15: America’s Big Business

America's Booming Business (1870s)

• The 1870s saw burgeoning business activity.
• Prominent businessmen built up and dominated major American industries.
• Oil, railroads, steamships, and the steel industry generated immense wealth for these men.
• These industries created thousands of jobs for the American workforce.

Oil

• Before automobiles, oil was essential for every machine.
• Oil is the substance from which gasoline is derived.
• The Seneca Indian tribe discovered a dark, oily substance, "rock oil," floating on ponds and streams in what is now New York State.
• This "rock oil" was sold as a tonic for almost 200 years.
• Later, wells were dug to extract more oil.
• By 1855, oil was refined into a usable lighting and heating solution.
• Oil became a valuable commodity after its discovery, and oil wells were drilled nationwide.
• In 1870, John D. Rockefeller established and led the first major American oil company.
• Within two years, Rockefeller's Standard Oil controlled over a quarter of all American oil refining.
• Rockefeller secured deals with railroad companies to reduce distribution costs.
• He was a hard worker and consistent giver, due to his upbringing.
• Throughout his life, Rockefeller donated at least ten percent of his income to his church.
• He gave large sums of money to various organizations.
• Rockefeller's philanthropy greatly benefited schools, colleges, hospitals, and medical research.
• A philanthropist is someone who donates money to support worthy causes.
• Rockefeller had another side and reputation.
• His business practices were deemed highly controversial and were criticized
• Rockefeller possessed considerable power and did not always use it fairly.

Railroads

• Cornelius Vanderbilt was another American big businessman.
• He demonstrated significant business acumen from a young age.
• Vanderbilt started in the ferry service business in the 1800s at the age of 16.
• His ferry operated between Staten Island and Manhattan, New York.
• Vanderbilt expanded the business by acquiring steamboat competitors and taking over the management of railroads.
• In 1847, Vanderbilt took over the presidency of the Stonington Railroad Company.
• When the gold rush began in 1849, Vanderbilt transitioned from local steamboats to ocean-faring steamships.
• Vanderbilt's steamships transported people to California via the Isthmus of Panama.
• Passengers traveled across the isthmus by mule train or canoe.
• Vanderbilt’s Panama business thrived shipping both passengers and their gold.
• Vanderbilt aided the Union Navy during the Civil War.
• After the Civil War, Vanderbilt rebuilt his railroad empire.
• Vanderbilt's competition in the railroad industry improved service.
• Vanderbilt earned the reputation of a "robber baron."
• Vanderbilt's wealth and power were considered controversial.

Steel

• Andrew Carnegie was another prominent American businessman.
• He was born in Scotland in 1834.
• The Carnegie family emigrated to the US when Andrew was 13 years old.
• To support his family, Andrew worked in a factory as a bobbin boy when his family was poor.
• Andrew was a dedicated worker.
• Carnegie worked as a telegraph messenger boy and rose to become an operator.
• He acquired knowledge through reading.
• In 1853, at 18 years old, Andrew began working for the Pennsylvania Railroad Company.
• At the Pennsylvania Railroad Company he was a secretary and telegraph operator.
• He invested in the steel industry.
• Andrew recognized the value of steel as the steel industry expanded.
• He emerged as the most influential figure in the steel industry.
• Andrew owned the largest steel operation in the country.
• Steel was used to build railroad tracks, the framework for tall buildings, and bridge pilings and bonnets.
• Carnegie donated his money away, much like Rockefeller.
• More than 3,000 libraries, schools, universities received funding from Andrew Carnegie.
• Carnegie's mission was to donate money to deserving organizations.