Why are industry executives so rich? What
risks do they take that justify them making SO
much money? Should they make that much
money?
John D. Rockefeller’s net worth…….340 Billion
dollars
Andrew Carnegie………………480 million
J.P. Morgan………………………….41.5 Billion
FLT: I will be able to explain the key
terms of big business and analyze the
titans of industry
What was a Titan?
 Time zones were established in order
to make keeping track of time easier
when traveling across the country
 Vertical integration – buying out suppliers
in order to control the raw materials and
transportation systems
 Horizontal integration – companies
producing similar products merge
 Trust – a small group of business people who
manage many companies in a unified way and
effectively eliminate the competition
 Merger – when one corporation buys out
another; a firm that bought out all its
competitors could achieve a monopoly
Minerals
Metals
Plastics
Circuit Boards
Packaging
Transportation
Stores
Own & Operate
all parts of
product process
Sprint
Verizon
AT&T
T-Mobile
Own & Operate multiple
businesses in the same industry
Boost
In your notes:
 Choose an industry (example: shoes,
clothing, computers, etc.)
 Create an example of vertical integration
 Create an example of horizontal integration
 Which business structure would you prefer ?
Why?
Take a look at Forutne 500’s list of the top ten
companies in 2014. Answer the questions in
complete sentences.
 Availability of work force (immigration)
 Inventions
 Lower-cost production
 Access to raw materials and energy
 National markets created by transportation
 Financial resources
 Advertising
Cornelius Vanderbilt
Andrew Carnegie
John D. Rockefeller
Henry Ford
_______________________________________________
Philanthropists
Robber Barons
 John D. Rockefeller
- Standard Oil
 Andrew Carnegie
- Steel
 Henry Ford
- Automobile
 Cornelius Vanderbilt
- Railroads
 Read the four biographies of the industrial titans
and answer each of their questions on your Titans
FourSquare.
 When finished, compare your findings with your
group to confirm
 Work together to complete your Titans FourSquare
 His single island-hopping ferry expands to an ocean
going fleet and he becomes synonymous with shipping
earning the nickname ‘Commodore’.
 Creates the largest shipping empire in the world.
Invests in the new railways believing they’ll unite
America.
 By war’s end, he’s the richest man in America with a
net worth of over $65 million equivalent to nearly $75
billion today.
 By 1866, he’s 72, and 30 years past the average age
expectancy. His railroad rivals think he’s weak and
ready to fall.
 He owns the only rail bridge into New York City, and it
is both the gateway to country’s largest and busiest
port and, in his hands, a weapon.
 Close Albany Bridge effectively blockading the
millions of dollars of cargo of other rival railroads.
 The rival rail road presidents try to sell their shares.
There’s a massive sell off, price falls, Vanderbilt buys
up. In just days, he creates the largest single railroad
company in America
 Lowered costs, increased efficiency, and sped up travel
and shipment times
 Opens the Grand Central Depot, the biggest train
station in the country. It covers 22 acres.
 He also gives the largest charitable donation in
American history with a $1m gift to a university that
still bears his name.
 Vanderbilt realizes the rail network has been overbuilt
and future profits will come from transporting new
cargo, not from building new lines. Kerosene that
lights the lamps of the newly industrializing America
will be explosive.
1.
How did he first acquire his wealth?
 Became one of the country’s largest steamship operators
2. What was his nickname?
 The Commodore
3. To which industry did he shift his focus and build an empire?
 The railroad industry
4. How did he transform the railroad network with his new

5.
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6.
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system?
Lowered costs, increased efficiency, and sped up travel and
shipment times
Which major construction project is he responsible for?
Manhattan’s Grand Central Depot
How did he donate his money?
not much to charity, but $1million to Vanderbilt University
 Scottish immigrant
 Uses Bessemer steel to mass-produce strong railroad
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rail ties.
Builds St. Louis bridge and connects east to west.
Opens steel plants and produces 10,000 tons of steel a
month and makes $1.5 million profits per year.
Bought out suppliers – coal fields, iron mines, ore
freighters, and railroad lines
The first Chicago skyscraper is built with Carnegie
steel.
 Johnstown disaster
 The dam bursts and more than 2,000 people are killed.
It’s the worst manmade disaster in American history,
prior to 9/11
 Carnegie feels responsible and donates millions to
rebuild Johnstown.
 Homestead Steel Works strike- 12 hour days and six
day weeks with workplace injuries and fatalities
 Sells Carnegie Steel for 480 million and becomes
richest man to ever
 Personal fortune of over $310 billion. The largest
private fortune the world has ever seen
 Carnegie spends the rest of his life giving away more
than 350 million dollars, or 67 billion in today’s money.
 “The Gospel of Wealth” – the rich are supposed to help
the poor
1.
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2.
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3.
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4.
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5.
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6.
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In which industry did he make a name for himself? Who and what
inspired him?
The steel industry after meeting Henry Bessemer and the Bessemer
Process
What two management practices led to his success?
Make better products more cheaply, attracted talented people to work
How did he use vertical integration to grow his industry?
Bought out suppliers – coal fields, iron mines, ore freighters, and
railroad lines
How did he use horizontal integration to grow his industry?
Attempted to buy out competing steel producers; controlled almost the
entire steel industry
To whom did he sell his business and for how much?
JP Morgan for $480 million
What was the title of his written essay and what did he say in it?
“The Gospel of Wealth” – the rich are supposed to help the poor
 Born Poor
 In 1863, at just 24, he invests everything into his first
refinery. By 27, he’s on the verge of bankruptcy
 Agrees to meet with the rail road magnate Vanderbilt,
hoping to secure competitive transport rates. But
Rockefeller narrowly misses his 6:25am train to New
York.
 Creates the country’s first monopoly. He now controls
90% of the North American oil supply.
 The 1873 crash panics the New York Stock Exchange.
The rich come out un-effected.
 His Standard Oil comes to symbolize big, bad
business. Roosevelt is re-elected and files dozens of
law-suits against dozens of trusts.
 As Edison’s electricity lights America, it reduces the
need for the Rockefeller supplied kerosene in
traditional oil lamps.
 Invests in gasoline used to fuel cars.
 Uses kickbacks, political bribes, predatory pricing and
when all else fails, intimidation.
 Violates Anti-Sherman Act
 34 smaller companies are formed. These will later
become Exxon, Mobil and Chevron
 The defeated Rockefeller is still left with a net worth,
in today’s money, of $660 billion.
 Before he dies, aged 97, he gives $100 billion of that
away.
1. What was the name of his trust company?
 Standard Oil
2. How did he make huge profits?
 Paid employees extremely low wages and driving his
competitors out of business
3. Why do you think monopolies may be illegal?
 Monopolies can manipulate the market with predatory
pricing
4. What did the Sherman Antitrust Act do?
 Made it illegal to form a trust that interfered with free trade
between states or with other countries
5. Would you consider him more of a philanthropist or a
robber baron? Why?
 Philanthropist – gave away lots of his money ; Robber
baron – manipulated the market
 Henry Ford is born on 30 July 1863 to an Irish
immigrant father and a Michigan born mother.
 Ford raises $28,000, just enough to build his first
factory outside Detroit
 Ford Model T goes on sale. Uses assembly line.
 It costs $900 dollars, nearly half the price of its
competitors, making it affordable for the average
consumer to buy.
 In 1914, Ford pays his workers $5 per day, double the
rate of most US factories.
 Rather than hand craft each car one at a time, they’re
assembled piece by piece by a line of workers.
 Standardize the eight hour workday and the five day
week
 Paid all races the same wages.
1.
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2.
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4.
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5.
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6.
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In which industry did he make a name for himself?
The automobile industry
What was the name of his company? His first model?
Ford Motor Company – Model T
What were some of his revolutionary new mass-production methods?
Use of large production plants, standardized interchangeable parts,
and the moving assembly line
What mass-production technique is he most famous for innovating?
The assembly line
What was the significance of mass production?
Cut down on the time required to produce, which allowed costs to stay
low
What did he do for his workers in setting a new standard for the
industry?
Increased the daily wage more than twice as much
Which of the four titans of industry that we
have studied do you think had the largest
impact on American society both back then
and today? Give at least 3 reasons why you
think so.
 The newspaper just announced that McDonalds has
bought out Wendy’s, Burger King and Jack in the Box
in a surprise move. Is this a good news or bad? Why?
 What is this called?
 Switch Henry Ford and John D. Rockefeller bios and
complete 4-square
 Questions
 Write up/Homework