Early 20th century construction, New York
Credit: Image Courtesy ofAmerican Memory
This, then, is held to be the duty of the man of wealth: First, to set an example of modest, unostentatious living, shunning display or extravagance; … and, after doing so, to consider all surplus revenues which come to him simply as trust funds, which he is called upon to administer… to produce the most beneficial results for the community—the man of wealth thus becoming the mere trustee and agent for his poorer brethren, bringing to their service his superior wisdom, experience and ability to administer, doing for them better than they would or could do for themselves."
—From "Wealth," by Andrew Carnegie, North American Review (1889)
"Law? Who cares about the law. Hain't I got the power?"
—Comment alleged to have been made by Cornelius Vanderbilt, when warned that he might be violating the law
Though a century has passed since the heyday of the great industrialists and financiers, debate continues: were these men captains of industry, without whom this country could not have taken its place as a great industrial power, or were they robber barons, limiting healthy competition and robbing from the poor to benefit the rich? Where do we draw the line between unfair business practices and competition that leads to innovation, investment, and improvement in the standard of living for everyone? Would the industrial economy have succeeded without entrepreneurs willing to take competition to its extremes?
It has been argued that we are now in a comparable economic period, the formative years of the Information Age. Certainly we continue to struggle with similar kinds of questions about fair and unfair business practices and the benefits and costs of competition. Does the industrialization of America at the end of the nineteenth and beginning of the twentieth century hold any lessons for us today? Can market forces exert sufficient influence to rein in potentially harmful practices or does government have to intervene?
Note: This lesson may be taught either as a stand-alone lesson or as a complement to another EDSITEment lesson The Industrial Age in America: Sweatshops, Steel Mills, and Factories.
After completing the lessons in this unit, students will be able to
If necessary, review with your class the historical context in which the early industrialists thrived. Use your class text or other classroom resources, or refer to either or both of the following interactive timelines available on the EDSITEment-reviewed website Learner.org:
Introduce your students to some individuals for whom the label "robber baron" is universally regarded as appropriate. Jim Fisk and Jay Gould clearly earned the title because they did not contribute to building something such as a railroad system. Instead, they destroyed such systems through clearly illegal actions and disregard for anyone else. Their actions hurt the economy of the United States. Read their story with—or to—the class from The Robber Barons, available on the PBS website, a link from the EDSITEment resource Internet Public Library. Now read with—or to—the class from The Panic of 1873, also on PBS. Ask students to explain why Jay Cooke deserves the title "robber baron."
Such behavior as Fisk's, Gould's, and Cooke's clearly fits the criteria for a robber baron. Tell the class that the label cannot always be applied with such assurance. What if an action is illegal but leads to a positive end? What if a legal action ends with many workers or consumers suffering?
Part of the students' job in Activity 2, below, will be to evaluate situations that are similarly ambiguous in the life histories of famous industrialists.
Divide the class into four student groups (or eight, if you'd like each industrialist/financier to be researched by two groups). Assign one of the individuals below to each group. Distribute to the groups the chart "Robber Baron or Captain of Industry?" on page 1 of the PDF. Using the following resources and/or any other approved sources available in your classroom or online, each group should fill in the chart for their assigned individual.
Read with—or to—the class any or all of the following pieces, available on the EDSITEment resource History Matters, written by workingmen and published in newspapers or magazines during the heyday of the industrialists.
How do students believe their assigned industrialist would respond to these pieces? Either in groups or individually, have students write a hypothetical letter to the editor in response.
3-4 class periods