Big Business

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Big Business
Big Business
A. How to divide the money
1. Capitalism – Private business runs most of
the industries and competition sets the
2. Socialism – The government plays a big part
in running industries and setting prices.
3. Communism – All people own businesses
together and all share in their profits. There
is no government at all.
B. Ideas that lead to Big Business
1. Free Markets
– US is a Capitalist system
– Government and business leaders believe in
laissez-faire capitalism.
– Laissez-Faire means “to let do” in French.
– Governments would not regulate business but let
it control itself.
2. Social Darwinism
Capitalism created inequalities among citizens
Rich people and poor people
Some believed this was part of the natural order.
Adapted Darwin’s beliefs of survival of the fittest
to society
– Strong businesses, governments, and people
would survive while weak ones failed
C. Corporations
1. What is a Corporation
– A corporation is a business that has legal status
just like it was a person
– It is owned by stock holders, people who buy
parts of the business
– Decisions are made by a board of directors
2. Why have Corporations
– Can raise lots of money by selling stock
– Limited risk, investors can only lose as much as
they invest
D. Industrial Tycoons
1. Rockefeller and Oil
– John D. Rockefeller start
Standard Oil (a refinery)
– Wanted to grow his business
– Took over companies that
supplied him with things
– Took over other oil
– By 1897 Standard Oil refined
90% of all US oil
2. Carnegie and Steel
– Andrew Carnegie started a
steel company
– Bought out companies that
supplied him to expand his
– He sold Carnegie Steel for
$480 million in 1901
– Gave away about $350
million mostly to promote
3. Views on the Tycoons
– Two Ways to view them
– Robber Barons: Got their wealth buy squeezing
out competition and stepping on the little guy
– Captains of Industry: made the American
Economy more productive and stronger
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