Laissez-Faire: Negative Consequences Monopolies - Large businesses or “trusts” dominated...

Laissez-Faire: Negative Consequences

Monopolies - Large businesses or “trusts” dominated industry, controlled prices, and limited consumer choice

Poor Working Conditions - Business tycoons take advantage of cheap immigrant labor and exploit women and children.

- No minimum wage

- No overtime

- No mandatory breaks

-No workers compensation for job-related injuries

-Few benefits

Laissez-Faire: Negative ConsequencesImages of Child Labor

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Wage Gap - the difference between the income of the Employee and the Employer is disproportionate



The Breakers - Newport, RI

The Vanderbilt “Summer Cottage”


•In 1900 there were 4,000 millionaires in America

•This represented less than one ten-thousandth of one percent of the population (1/10,000 of 1%)

1.Yet this small group of millionaires held 20% of the nation’s wealth!


Average family wealth in 1890:

Wealthiest Class Poorest Class

125,000 Families 5,500,000 Families

$264,000 ($3,653,760)* $150 ($2,076)*

The Wage Gap

*(In 1990 dollar value)

The Progressive Spirit

Dedicated to political, social and economic reform and progress.

They believed that government could and should be used to regulate business, politics and social welfare in order to protect those unable to protect themselves

Progressives were:

The Progressive Spirit

1) Analysts - those who studied human problems and attempted to devise solutions to those problems

2) Activists - those who brought national attention to the major social, political and economic problems of American society and took steps to solve them

Two Types of Progressives

Angry Writers: The Muckrakers



Upton Sinclair

Muckrakers wrote articles, novels and opinion columns to bring national attention to social, political and economic injustices.

Some Muckrakers eventually caused enough of a stir to put pressure on Politicians to make reforms

Angry Writers: The Muckrakers

The Jungle chronicled the life of a Lithuanian immigrant worker in the Chicago meat-packing industry

“I aimed for the nation’s heart, and accidentally hit it in the stomach” - Upton Sinclair



Jane Addams: Savior of the City

A wealthy philanthropist, Jane Addams opened “Hull House,” a settlement house that provided shelter and social and educational opportunities to poor Chicago residents.

- Free classes in literature, history, art, domestic arts

- Free concerts

- Free lectures on current issues

- Social clubs for both children and adults

- A daycare center

- Nutritious food distribution to the malnourished or sick

- A homeless shelter

- Public baths

Hull House Provided:

Political Consequences of Laissez-Faire: “Machine” Politics

Since the federal government was “hands off,” local and city governments grew extremely powerful and corrupt. Ward “Bosses” remained in power through bribery, intimidation and propaganda.

For the first time in American history, being a career politician was a profitable way of life.

“I seen my opportunities, and I took ‘em!” - G.W. Plunkitt

Raging Against the Machine: LaFollette’s ‘Wisconsin Idea’



In order to take political power away from corrupt city machines and put it back in the hands of the people, Gov. LaFollette proposed the “Wisconsin Idea” in 1903.

Direct Primary

Initiative

Referendum

Recall “Fighting” Bob LaFollette

The Progressive Presidents



Teddy RooseveltThe First President to actively involve Government in regulating business

The first president to push for environmental protection and nature conservation

Teddy Roosevelt: Moderate Progressive Used new Anti-trust laws to go after big business and its monopolistic behaviors

“Trust-Busting” reputation an overstatement - Though he took on the trusts, he rarely broke them up, choosing instead to regulate them

Not always a friend to unions - he often pushed for arbitration and threatened using the Armed forces to intimidate striking workers who he claimed were “interrupting interstate trade”

Teddy Roosevelt: Moderate Progressive

ENVIRONMENTAL REGULATION

- Newlands Reclamation Act - 1902

- Added 150 million acres to protected US Forest land

- Created 5 new National Parks

- Established 51 federal bird reservations

- Started 4 national game preserves

Teddy Roosevelt: Moderate Progressive

CONSUMER PROTECTION

- Meat Inspection Act - 1906

- Pure Food and Drug Act* - 1906

*(paves the way for FDA in 1938)

William Howard Taft : 1909-1913



- More soft-spoken and reserved than TR

- Prosecuted twice as many trusts asTR in half the time

- Expanded laws requiring mine owners to increase safety

- Established a “Children’s Bureau” to protect the rights of children

Teddy Roosevelt: “Bull Moose”Leaves the Republican Party to form the Progressive Party - Runs unsuccessfully for re-election in 1912

Party Platform included:

A minimum-wage law for women

Prohibition of Child Labor

Workers’ compensation laws

A Federal Trade Commission

Women’s Suffrage

Initiative, Referendum and Recall at the Federal level



Woodrow Wilson: The Academic



President of Princeton University

Governor of NJ - was elected with help from city Political Machines, which he later sought to destroy

Son of a Presbyterian minister, moral values were extremely important to his decision-making

Had a PhD in Political Science (could be considered a Progressive Analyst)

Woodrow Wilson: Progressive Governor

Refused to endorse machine boss James Smith for State Senate, even though Smith helped him get elected Governor of NJ!!!

Revamped election laws to end corruption

Established regulatory boards for utilities (water, electric power, communications)

Woodrow Wilson: Progressive President

Teddy Roosevelt’s establishment of the Progressive Party splits the Republican voters, allowing Wilson, a Democrat, to win easily

Wilson criticizes Roosevelt for “regulating monopolies” rather than destroying them

Establishes the “New Freedom,” a program to break up large trusts in order to restore competition between small businesses

The New Freedom in Action

Underwood Tariff - 1913 - cut previous tariff rates in half - Wilson saw high tariffs as “favors to big business”

Federal Reserve System - stabilized the banking system. Banks would have to keep a certain % of their money in a Federal Reserve Bank for safekeeping against financial losses

Clayton Anti-Trust Act of 1914 - helped prevent monopolies and held individual businessmen accountable for breaking the law by imposing strict punishments

The New Freedom in Action

Federal Trade Commission (FTC) - A new government authority established to stop unfair trading and business practices among companies

Pushed for Child Labor Law in 1916 (Struck down by courts in 1918 - States’ Rights issue)

Supported Mandatory Worker’s Compensation laws

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