For one million dollars who said, “Millionaires are the bees that make the most honey and contribute most to the hive even after they have gorged themselves full.” If you said Andrew Carnegie, congratulations, you have joined the ranks of the millionaire club. Many people today are inclined to believe that everyone, even the most average person, can become a millionaire. If you do not believe me just go to your mailbox, you may already be one. Americans living over a hundred years ago may not have had Regis Philbin, but they did have Horatio Alger . In his novels, Alger popularized the concept of “rags to riches,” and convinced his readers that with hard work and luck they too could become wealthy. This mindset fits within the framework of a theory known as Social Darwinism, which applied Darwin’s survival of the fittest to the marketplace. Many wealthy industrialists used this theory in the late 19th century to justify their unscrupulous business practices.
Between 1870 and 1900 the United States was quickly becoming a world industrial power. The impact of industrialization made Americans aware that they lived in a new age. By the mid 1880s many American cities had electricity and hundreds of homes had telephones along with various other modern conveniences. This time of economic transformation came about partly through some ingenious business practices from a group of individuals sometimes called the “Captains of Industry.” Men like Andrew Carnegie , John D. Rockefeller , Jay Gould, and J.P. Morgan transformed the American economy with their business skills and making new use of existing business practices.
In order to limit their liability and maximize their profits, businessmen relied on corporations. This was not a new business phenomenon, but by the late 19th century the concept of the corporation had changed. Several entrepreneurs realized that a successful enterprise was one that could eliminate or absorb its competitors. Consequently, small corporations merged with one another in order to increase their efficiency and profits. These so-called “mega corporations” were known as trusts since their means of production and distribution were managed by a board of trustees. Many Americans, however, were concerned that this system gave a very few men enormous economic power. As a result, the business practices of these wealthy industrialists came under close scrutiny.
From the beginning, large segments of the population had looked on the proliferation of business combinations with mistrust and hostility. The popular description of such men as Rockefeller, Carnegie, and Morgan as “robber barons” suggests the attitude of many. The most strident opponents, farmers and factory workers, argued that the new economy controlled by corporate power eroded the opportunity for individuals. This growing criticism presented the leaders of industry with a challenge. They not only had to build the new corporate economy, but also had to find a way to legitimize it. Therefore, most moguls liked to claim that they were “self-made men” who had attained their wealth and power through hard work, avarice, and thrift -- the traditional virtues of Protestant America. John D. Rockefeller expressed a prevailing assumption that riches were a reward for worthiness when he explained, “God gave me my money!” In reality, most business tycoons had started their careers from comfortable positions, but there were enough who really had emerged from obscurity to riches (Andrew Carnegie worked as a bobbin boy in a cotton mill and John D. Rockefeller started out as a clerk in a commission house) to invest the entire group of wealthy industrialists with the aura of the American success story. On the other hand, those who failed in the marketplace had earned it as one Protestant minister insensitively stated, “Let us remember that there is not a poor person in the United States who was not made poor by his own shortcomings.”
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