PP Notes Capitalism

Robber Barons “…the three foremost exponents of business enterprise: Morgan, Carnegie and Rockefeller. The first because he had created a virtual monopoly in banking, a “money Trust”; the second because of his death-grip on the key industry of the country; the third, Rockefeller, because of his amassing of industrial profit continued at such a high rate that an immense reservoir of cash was accumulated, which sought outlet through investment-banking operations of a size exceeding even those of Pierpont Morgan.” -Josephson p 388 Cornelius Vanderbilt 1794-1877 Born to poor Dutch peasants in Staten Island Left school at 11 to help his father Self educated At 16, borrowed $100 from his parents, bought a small boat and started a ferry service to NYC 1818 sold his ships and became a steam ferry captain, eventually managing the fleet 1829 established a line of steamboats 1846 moved to NYC During the CA gold rush, devised a plan to sail people to Nicaragua, where he then built a RR that could take them up the coast to CA The “Commodore” was involved in nautical interests (shipping, etc.), and then RRs 1857 invested in NY & Harlem RR 1875 owned most of the RR systems in coming into NY and in the Midwest/East coast area Considered one of the greatest Railroad Barons Never too concerned with philanthropy, but gave $1 million to Central Univ. in Nashville, which thus became Vanderbilt Univ. When he died he was the richest man in NYC and left his fortune to William, one of his thirteen children Andrew Carnegie 1835-1919 Born in Dunfermline, Scotland and emigrated in 1848 At 14, worked as a bobbin boy in a textile factory, loved “progress” Optimistic, by 17 he was a telegrapher ($800 a year) Always looking for a way to get ahead, never let opportunity pass him by – even if meant breaking some rules The Gospel of Wealth: the rich should help enrich society, not ‘waste’ it on those who don’t have wealth (social Darwinist) Made his largest fortunes in steel, mass producing for rail lines Also owned other businesses (Pittsburgh Locomotive, Car Works) 1901 sold his steel holdings to JP Morgan for $250 million (negotiated in secret by Charles Schwab) By the time he died, he’d given away $350,695,653 and the last $30,000,000 at his death was also given to various interests “Rags to Riches” J.P. Morgan 1837-1913 Educated in Boston and Germany, later did banking for his father and then became a partner in Drexel, Morgan and Co. Collected antiquity art, books and was a philanthropist Very secretive, avoided too many public appearances, was embarrassed by a deformed nose Head of JP Morgan (1895) and member of Cromwell’s banking house Arranged merger of two major electric companies, creating General Electric Cromwell helped Morgan create the largest company in the world: United Steel Owned over 5000 miles of American Railroads In this he also became in Panama and funded the purchase of the French Canal Company Also lent the money for Panama’s independence, and later administered the country’s treasury Had incredible financial prowess with connections in the U.S. and Europe 1904 Northern Securities Corp. dissolved by Supreme Court (violated the Sherman Anti-Trust Act) Sat on numerous boards and influenced most of the nations’ major corporations; influenced politics, regulatory and financial laws, industry, etc. Upon his death his art collection (very extensive) was donated to the Metropolitan Museum of Art in NY John D. Rockefeller 1839-1937 By 16 he worked as book keeper 1859 partner in a small produce business Within 4 years, he entered the oil refinery business 1870 organized Standard Oil Came to dominate the oil refinery business (mergers, eliminating competition, gaining large capital, agreements with competitors, crushing small businessmen) 1882 all of his diversified holdings were placed together under the Standard Oil Trust Also an accomplished financer Also an accomplished financer One of the directors of the 1901 U.S. Steel Corp. Had massive holdings in petroleum Several times the government forced Rockefeller to dissolve his interests Also avoided public attention Deep religious faith Donated to the Baptist Church, YMCA, etc. 1892 founded the University of Chicago Would start numerous foundations for public health, medical research, child welfare, etc.