Interstate Commerce Act of 1887 Prohibited rebates Required the railroads to publish rates openly Outlawed charging more for short haul Forbade discrimination against shippers Established the Interstate Commerce Commission to enforce law 1st attempt by Washington to regulate big business in the public interest Elimination of Competition Competition was wasteful Vertical integration Carnegie Steel – Horizontal integration trusts Rockefeller and Standard Oil Company – – Interlocking directorates J.P. Morgan and banking – is King!” “Steel industry capital goods – Foundation for tall buildings industry Bessemer process made cheap steel possible By 1900 U.S. producing as much as Great Britain and Germany combined Andrew Carnegie Carnegie Steel the costs profits will take care of themselves” “Watch – Vertical consolidation 1900 - $40 million profit Philanthropist The Gospel of Wealth Carnegie’s philosophy The wealthy are entrusted with the public wealth and must use is wisely Gave away the bulk of his fortune - $350 million Libraries Church organs Schools J.P. Morgan Banker” “Banker’s Wall Street banker financed railroads, insurance cos., and banks – Bought Carnegie Steel for $0.5 billion Created U.S. Steel 1st $1 billion company –
Interstate Commerce Act of 1887 Prohibited rebates Required the railroads to publish rates openly Outlawed charging more for short haul Forbade discrimination against shippers Established the Interstate Commerce Commission to enforce law 1st attempt by Washington to regulate big business in the public interest Elimination of Competition Competition was wasteful Vertical integration – Carnegie Steel Horizontal integration – trusts – Rockefeller and Standard Oil Company Interlocking directorates – J.P. Morgan and banking “Steel is King!” industry – capital goods Foundation for tall buildings industry Bessemer process made cheap steel possible By 1900 U.S. producing as much as Great Britain and Germany combined Andrew Carnegie Carnegie Steel “Watch the costs – profits will take care of themselves” Vertical consolidation 1900 - $40 million profit Philanthropist The Gospel of Wealth Carnegie’s philosophy The wealthy are entrusted with the public wealth and must use is wisely Gave away the bulk of his fortune - $350 million Libraries Church organs Schools J.P. Morgan “Banker’s Banker” Wall Street banker – financed railroads, insurance cos., and banks Bought Carnegie Steel for $0.5 billion Created U.S. Steel – 1st $1 billion company
Chap%2024%20notes%20Industry%20Comes%20of%20Age.docx