Big Business & Monopolies Page 16 U.S. economy originally based on “Laissez - faire” Means...
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Transcript of Big Business & Monopolies Page 16 U.S. economy originally based on “Laissez - faire” Means...
![Page 1: Big Business & Monopolies Page 16 U.S. economy originally based on “Laissez - faire” Means government did not interfere with the economy.](https://reader035.fdocuments.in/reader035/viewer/2022070412/56649ef25503460f94c03c33/html5/thumbnails/1.jpg)
Big Business &Monopolies
Page 16
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U.S. economy originally based on
“Laissez - faire”
Means government did not interfere with
the economy
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Principle of U.S. economy =
Capitalism CapitalismCapitalism CapitalismCapitalism Capitalism
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Capitalism• People own the businesses
Prices based on supply and demand
Principle - hard work will pay off - work hard to gain profits
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Problems with “Laissez - Faire”
Monopolies began to form
Monopolies - businesses that tried to eliminate all
competition
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Problems with monopolies
Higher prices and fewer choices for consumers
Higher prices caused people to pressure the government into
ending monopolies
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Big Business Leaders
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*/25,
Andrew Carnagie John D. Rockefeller
Don’t Forget Don’t Forget Don’t Forget Don’t Forget
J.P. Morgan
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Government’s effort to break up
monopolies
Called
Trustbusting!
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Nothing in the Constitution gave the
government the power to break up monopoliesThey used the provision in
the Constitution that allows Congress to
regulate interstate trade
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Sherman Anti-Trust Acts
Trustbusting legislation
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Interstate Commerce
CommissionFirst Regulatory
Commission ever formedDesigned to oversee the railroads
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Federal Trade Commission
Still exists - to watch out for monopolies
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Resistance to these efforts
SOCIAL DARWINISM
Social Darwinism - business leaders complained that
monopolies were natural survival of the fittest
companies
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Changing Role of the Federal Government
in the EconomyAs the economy changed from an
agricultural to an industrial economy the Federal government was forced to take a larger role
LARGER ROLE LARGER ROLE LARGER ROLE
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Government used Tariffs to protect the economy
from foreign competition
Tariffs - taxes on foreign goods to make them more expensive
Farmers generally did NOT like tariffs because it made manufactured goods
more expensive
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CorporationsBusinesses owned by
stockholdersAdvantage of Corporations Advantage of Corporations Advantage of Corporations Advantage of Corporations Advantage of Corporations Advantage of Corporations
Advantage of Corporations - able to raise large amounts of
capital