Who Were the Robber Barons?
Summary
TLDRIn this episode of Business Blaze, Simon Iron explores the era of 'Robber Barons,' wealthy industrialists in late 1800s America who amassed fortunes through ruthless business tactics. Cornelius Vanderbilt and John D. Rockefeller are highlighted for their dominance in railroads and oil, respectively. The video delves into their exploitative practices, the government's complicity, and the labor struggles that led to unionization. It also acknowledges their philanthropy, which shaped modern charitable giving and education, leaving a complex legacy.
Takeaways
- 😀 The term 'robber barons' originated from an old German term 'Raubritter', which means knight or Baron, and was used to describe nobles in the Holy Roman Empire.
- 🏭 Post-American Civil War, the United States saw the rise of wealthy industrialists known as 'robber barons', who amassed fortunes in industries like railroads, coal, steel, and oil.
- 🚂 Cornelius Vanderbilt, one of the first robber barons, made his fortune in railroads and shipping, using aggressive tactics and bribes to eliminate competition.
- 💰 John D. Rockefeller's Standard Oil Company became the largest corporation in existence by using tactics like undercutting prices and forming cartels to dominate the oil industry.
- 🤝 The US government post-Civil War was corrupt, with officials often colluding with robber barons, allowing their exploitative practices to go unchecked.
- 🏛️ The Vanderbilt family, descendants of robber baron Cornelius Vanderbilt, maintained their wealth and influence, with properties like the Biltmore Estate.
- 📚 Despite their exploitative practices, many robber barons were also significant philanthropists, contributing to the establishment of universities and public libraries.
- 🔨 Labor conditions during the time of robber barons were often dangerous and unhealthy, leading to the rise of labor unions and worker strikes.
- 📚 Works like 'The Jungle' and 'The History of the Standard Oil Company' exposed the abuses of the time, leading to public outcry and eventual legal reforms.
- 🛣️ The expansion of railroads was a significant factor in the post-Civil War economic boom, with the northern railroads playing a crucial role in the Union's victory.
Q & A
What is the origin of the term 'robber barons'?
-The term 'robber barons' originates from an old German term 'Raubritter,' which means 'rob knight' or 'rob baron.' It was used to describe nobles in the many German states that made up the Holy Roman Empire.
How did the American robber barons amass their wealth?
-American robber barons amassed their wealth primarily through industries that powered the American industrial revolution, such as railroads, coal, steel, and oil. They often used aggressive expansion and unscrupulous business tactics to monopolize markets and accumulate vast fortunes.
Who was Cornelius Vanderbilt and how did he become a robber baron?
-Cornelius Vanderbilt was an American business magnate who became one of the wealthiest Americans in history by building a fortune in railroads and shipping. He used tactics such as bribes, payoffs, and aggressive competition to eliminate rivals and consolidate his control over the railroad industry.
What role did railroads play in the expansion of the United States after the Civil War?
-Railroads played a crucial role in the expansion of the United States after the Civil War by connecting the northern and southern parts of the country and enabling the movement of goods, people, and military supplies. They were instrumental in the westward expansion and the development of the American economy.
How did John D. Rockefeller's business tactics contribute to the growth of Standard Oil?
-John D. Rockefeller's business tactics, such as aggressive expansion, undercutting competitors' prices, and forming cartels, allowed Standard Oil to become the largest corporation at the time. He often drove competitors out of business or bought them out at low prices, consolidating control over the oil industry.
What was the impact of the robber barons on labor conditions during the industrial revolution?
-The robber barons often had a negative impact on labor conditions, with workers facing dangerous and unhealthy environments, short life expectancies, and low wages. Resistance from workers, such as strikes and the formation of labor unions, was often met with violence and repression.
How did the government's attitude and actions contribute to the rise of the robber barons?
-The post-Civil War American government was often corrupt and complicit in the rise of the robber barons. Many officials accepted bribes and looked the other way as business practices that would be considered illegal today were carried out, allowing the robber barons to operate with impunity.
What philanthropic efforts are associated with the robber barons?
-Despite their exploitative business practices, many robber barons were also significant philanthropists. For example, Andrew Carnegie founded the modern public library system, and the Rockefeller Foundation has donated billions to various charitable causes.
How did public opinion and legal changes affect the business practices of the robber barons?
-Public opinion, fueled by exposés like 'The Jungle' and 'The History of the Standard Oil Company,' along with the rise of labor unions and progressive politicians like Theodore Roosevelt, led to legal changes that curbed some of the worst abuses of the robber barons and improved conditions for workers.
What legacy do the robber barons have on modern American society?
-The robber barons have a complex legacy, with their wealth and influence shaping the development of American industry and the economy, but also contributing to the establishment of labor rights, philanthropy, and the modern regulatory environment that governs business practices.
Outlines
💼 Introduction to Robber Barons
The video begins with the host, Simon, introducing the topic of 'robber barons,' a term unfamiliar to him initially. Matthew provides extensive research on the subject, leading to a discussion about the rise of wealthy industrialists in the United States during the late 1800s. These individuals, known as robber barons, amassed fortunes and power similar to European nobility. The term 'robber baron' is explained to have originated from the German term 'Raubritter,' meaning knight or baron, and was used to describe nobles in the Holy Roman Empire. The conversation shifts to the American context, highlighting the lack of formal titles and the rise of these figures through industries like railroads, coal, steel, and oil.
🚂 The Impact of Railroads and Cornelius Vanderbilt
The video delves into the significance of railroads in the United States post-Civil War, highlighting how they facilitated industrial expansion and connected the nation. Cornelius Vanderbilt is introduced as a prime example of a robber baron who capitalized on the railroad industry. His business tactics included accepting bribes to not compete with local companies, forcing competitors out of business, or buying them out at low prices. The video discusses the unregulated nature of the industry and the government's complicity in the corrupt practices of the time, which allowed Vanderbilt and others to amass wealth and influence.
🏭 John D. Rockefeller and the Oil Industry
This section focuses on John D. Rockefeller, another notorious robber baron, who made his fortune in the oil industry. Rockefeller's Standard Oil Company became the largest corporation of its time through aggressive expansion and ruthless business tactics. The video describes how Rockefeller would undercut local oil prices to drive competitors out of business or force them to sell at a loss. His wealth and influence were so vast that he could dictate terms to smaller businesses. The discussion also touches on the illegality of such practices today and the historical context that allowed these business practices to thrive.
🏗️ Philanthropy and Labor Conditions
The final paragraph discusses the dual nature of the robber barons, highlighting their negative impact on labor conditions and their contributions to society through philanthropy. It mentions the harsh working conditions in industries dominated by robber barons and the rise of labor unions as a response. The video also acknowledges the positive legacy of these figures, such as the establishment of universities and public libraries, funded by their wealth. The host invites viewers to consider the complex legacy of the robber barons and encourages feedback for future video topics.
Mindmap
Keywords
💡Robber Barons
💡Industrial Revolution
💡Cornelius Vanderbilt
💡Standard Oil
💡Cartels
💡Labor Unions
💡Philanthropy
💡Regulation
💡Anti-competitive
💡Generational Wealth
Highlights
Introduction to the concept of 'robber barons' and their historical context in the late 1800s United States.
Explanation of the term 'robber baron', its origin from the Holy Roman Empire, and its association with toll collection.
The rise of American robber barons following the Civil War and their comparison to European nobility.
The industries that produced the most significant robber barons, particularly railroads, coal, steel, and oil.
The role of Cornelius Vanderbilt as an early robber baron, his wealth accumulation, and business tactics.
The impact of the Civil War on the expansion of railroads and the subsequent wealth of robber barons.
The government's complicity in the rise of robber barons due to corruption and lack of regulation.
The wealth and influence of the Vanderbilt family, including their palatial homes and modern-day descendants.
John D. Rockefeller's rise to wealth through the oil industry and the tactics he used to dominate the market.
The concept of cartels and their role in allowing robber barons to fix prices and eliminate competition.
The poor working conditions and treatment of laborers during the era of robber barons.
The rise of labor unions and public outcry against the abuses of robber barons.
The philanthropic efforts of robber barons, such as the Rockefeller Foundation and Andrew Carnegie's libraries.
The legacy of robber barons in modern society, including their contributions to education and public welfare.
The debate over whether robber barons were innovative business leaders or exploitative figures.
Conclusion and call to action for viewers to share their thoughts on robber barons and suggest topics for future videos.
Transcripts
I feel like there's no poor people
called Cornelius welcome to a brand new
episode of business blaze my name is
Simon iron your host as always in this
one we are looking at robber barons I
didn't really know what the robber
barons were I thought it could be
interesting
apparently it is because Matthew put
together two and a half pages with small
type I should have blown this up so it'd
be easier to read but we're gonna learn
something together like we always do
it's about the robber barons Thank You
Matthew for putting this together and
before we just jump into it if you've
got suggestions for a future business
blaze video you know what to do leave it
in the comments below we can get
something made up and we'll talk about
it it'll be fun and also while you're
down there smash that like button let's
get into it in the middle of the late
1800s rich industrialists in the United
States developed a reputation of agreed
so extreme that these dudes got the
nickname robber barons basically these
men they were all men this is the 1800s
after all very true amassed such amazing
wealth that they were basically a bought
into aristocratic class in the United
States they were in many ways similar to
the nobility of Europe and not just in
being rich but they also behaved much
like the feudal lords of the continent
as well so before we get into it what
about the term itself
tell me Matthew roll baron comes from an
old German term ah my German
pronunciation and always Germans you are
particularly harsh about me knowing that
I should know how to pronounce your
language I don't really feel any
obligations have to learn how to
pronounce your language but I'm just
gonna go for Rob Ritter now what it
means is Rob mint Rob and Ritter meant
knight or Baron so there you go it was
used to describe nobles in the many
German states that made up the Holy
Roman Empire but it's not just the name
stay tuned
well I'm not going anywhere right so
many of these robber barons and they
were not literally barons by the way
they had all sorts of different titles
this is the dudes in Germany not in the
US you don't have titles
do you have titles in the US and I think
so right it's all just like earned
titles like doctor or professor or
Reverend
so in defiance of formal informal or
understood rules of and laws they
decided whoever whatever moves through
my land is going to
give me some of their money sounds
pretty smart though the name came from
what is now Germany the world robber
barons everywhere I mean it's a pretty
good way to make money indeed I think
about toll bridges there's this one in
the UK speed art furred cross and I hate
that piece of every time I would come
from an airport to visit my parents I'd
have to drive over this bridge and they
charge you two pounds fifty and the
has been there forever and I'm
sure they've paid it off and I think
that was the original agreement and now
they don't even have tolls so afterwards
you have to go and register your rental
car online and we're like hey I want to
pay my toll and if you don't the they'll
they'll find the renter company and then
the renter company has an extra fine
which they tack onto you greed knows no
boundaries though not even the Atlantic
all the Dartford Crossing peoples after
the American Civil War hundreds of local
and national robber barons appeared in
the giant industrial expansion that took
place in the United States after the
conflict was over though robber barons
appears in all sorts of industries from
shipping to building to agriculture it
was in the industries that powered the
American industrial revolution that the
biggest most influential and most
egregious robber barons appeared these
were the railroads coal steel and oil
yeah like if I think of industries where
people got super-rich like rich like was
rockefeller a robber baron I imagine
he's gonna be mentioned for sure if he
is a robber baron but he seems like one
of these dudes they was he rail I don't
know something like this however runs
bidding virtually all of the trade going
on within the nation at the time where
the railroad so we're gonna be talking
some railroads America is really big it
is indeed and things at the go places
before the Civil War many of the
railroads in the US were not connected
in most instances rail would go through
a local area and stop great for locals
not so great if you wanted to go
somewhere far away also most of these
were near the coast allowing farmers to
get their goods to ship a bit faster
than they could on horseback it's super
interesting like back in the day how
long and complicated it was to ship
anything anywhere now I got a FedEx
package and it was like it was in from
he was from Chicago I lived in Prague in
the Czech Republic and he was
overnighted from Chicago absolutely
insane like from door to door
overnight a halfway around the world
incredible now to make sense of the
expansion of the railroads we need to
understand how this
happened during the war during the war
railroad especially in the heavily
industrialized and industrializing north
expanded exponentially but many factors
led to the defeat of the Confederacy
that's the south I appreciate Matti
putting that in there because I'm not
American I'm sure for Americans like yes
I won obviously I appreciate it one of
them surely was the expansion of the
northern railroads which allowed men and
materiel to be transported from the
factory recruiting grounds and farms the
front lines within the war trains
allowed rapid movements of masses of
troops in the south could simply not
keep up Deering during the conflict the
men and the companies of the northern
rails expanded greatly and connected
virtually all of the rails in the
northern part of the country as the war
moved deeper and deeper into the south
the railways followed after the war
southern expansion continued and
expansion into the West which was
somewhat stalled during the conflicts
and it began again so this is
interesting I was watching a video the
other day about why railways suck in the
u.s. it seems like you guys are really
good or railways at the beginning what
happens alright so now let's get back to
how this relates the a we did okay how
how does this relate to robber barons I
was gonna be to do the railways so as
you can really guess someone had to
build those railroads and get paid for
it yes indeed and they got mega paid and
they got mega rich a great example of
this is a dude called Cornelius
Vanderbilt and I do feel like Cornelius
Vanderbilt is the most role of irony of
robber baron names I feel like there's
no poor people called Cornelius now
Vanderbilt was already a baller even
before the war started from both
railroads and shipping but the war made
him even richer he was indeed the first
robber baron in the u.s. in many cases
Vanderbilt received huge bribes and
payoffs not to compete with local
companies at times he would comply and
others he wouldn't at his own choosing
sometimes it paid more to invade other
company's territory and then accept
bribes kickbacks or payoffs he would
force his competition competitors out of
business or if they were smart he'd buy
them out usually at pennies on the
dollar it does seem pretty smart I
imagine the industry was pretty
unregulated it was like yeah I could
compete against you or you could bribe
me and then you'd just be like
opportunity costs like the brow is
pretty good but it's not as much money
as if I pushed you out all the bribes
pretty good I just can't be bothered
either way you win pretty amazing but
also super anti-competitive and I'm not
so I imagine this is entirely illegal
today yeah bribery would be Simon
okay so while it's a bit different to
the German version of the tolls which we
saw earlier it's similar to a sort of
unfair competition and tariffs or at
least that's the way people saw it okay
so people did see it as unfair back then
there just didn't seem to be any laws
against it which I guess is why they
were like called robber barons because
they were robbing people all right so
now you might be thinking how did he get
away with this it sounds pretty much
like he could do whatever he wanted
where was the you know the government to
stop all this nonsense that is exactly
what I was wondering as always I should
read these thing through before making
random comments well they were kind of
in on it too okay here we go the
American government after the Civil War
was seriously corrupt and many officials
had their hands out they wanted a part
of the tremendous expansion of the
nation's economy and power there was a
ton of money floating around in the
space and it was hard to say no yeah but
if you're in the government you should
say no that's kind of your job and if
you're not saying no there should be
courts and stuff to punish the battery
because clearly this isn't working and
the whole government was super corrupt
so it's basically a kind of like well
everyone's doing it situation not good
bands Milton is a large family Oh fun
fact here apparently Gloria Vanderbilt
who I don't know who she is but I do
know who Anderson Cooper is Gloria
Vanderbilt's her mum they are descended
from his family and they're super rich
because they've been even today I didn't
know that I didn't know Anderson Cooper
was like I just thought he was like a
super rich TV guy
that's cool but I guess it's called
generational in a way I like this it's
kind of like wow they made a lot of
money and they really held on to it and
then as I also yeah they're just super
rich forever I don't know if that's good
like in the UK a lot of that gets
crushed because I don't know how it is
in the States but in the UK an
inheritance tax it's absolutely brutal
like if you're rich they will take you
know most of your money just one of
their many palatial homes the
Vanderbilts sorry today which is one of
their many palatial homes the Biltmore
in North Carolina is today a tourist
attraction sort of like the castles of
the Royals in Europe all right so how
about another robber baron and this one
you have for sure heard of and that's
john d rockefeller he got rich elsewhere
he zeroed in on early on the value of
petroleum originally used in making
kerosene which was in high demand
petroleum obviously later became the key
ingredient in the development of gas and
the internal combustion engine and cars
while they turned out to be kind of a
big deal
got into the oil business right after
the Civil War and through aggressive
expansion and shrewd and sometimes
extremely unscrupulous business tactics
he made his Standard Oil Company the
largest corporation that ever existed so
far and this dude was rich like it's
hard to compare because it was so long
ago but considering the amazing wealth
of Jeff Bezos of Amazon the richest man
in the world
by far yeah he's worse like Jeff Bezos
is like a hundred fifty some million and
Gates is like at ninety something Jeff
Bezos is rib-eye
Irie I really feel like Jeff Bezos you
know you're rich where you're the
richest man in the world and you get
divorced and you're still the richest
man in the world that's when you know
you're rich however rockefeller is
likely the richest person to have ever
lived with the possible exception of
Augustus Caesar yeah that's got to be
rich seasoned super hard to work out
though so let's just say rockefeller was
off-the-charts wealthy and that made it
easy for him to drive potential
competitors out of business so how did
rockefeller operate well it moves into a
new area and say to the local oil man
hey I want to buy your business if he
said yes amazing if he said no things
are about to get really rough for him
Rockefeller would begin selling oil to
that man's competitors is an extremely
low price and the load that the locals
could not compete with eventually the
small firm would be driven out of
business or were bought out by Standard
Oil and Rockefeller would get it for way
less than it initially offered put
yourself in the position of the guy
who's facing up to rockefeller it's a
you know because he's done he's done
this before by the time he gets to you
who's done this before you know that if
he stands out earlier like now I'm gonna
compete with you he's just gonna crush
your business and buy for nothing so
your desire no matter how much you want
to stay in business is just is just you
to sell this would be so illegal today
this was just one of the many tactics
that Rockefellers and the Rockefeller
and others like him in other industries
used and yes all of this would be
totally illegal today but it was sort of
like the business Wild West others
included setting up cartels sounds
illegal it wasn't illegal it is illegal
now these were unofficial organizations
of companies in the same industries but
in other parts of the country basically
they'd say hey let's not compete with
each other let's also set the super high
price of a really high margin and we'll
all get away with it and get super rich
if laws didn't exist like this too
this today of course this would happen
you'd be like if I was running a shop
and my mate
John was running a shop down the street
and we sold Mars bars I would say I'd go
to jail hey Judd have we were the only
source of Mars bars in the town
I just sated and everyone loved Mars
bars you know so I'm just setting up the
situation here it's obviously fictional
I would definitely have lunch with John
one day and be like John I know we're
competitors but how about we just set
the price in Mars bars at like 2 pounds
20 and people have to buy them and
that's like how it is and then that
would definitely be illegal although I
still feel like I could I do feel like
if I was in a petrol station in the
middle of nowhere that still charged me
two pounds 20 for a Mars bar but then
that's not collusion that's just there's
no one else around so to get a Mars bar
from just economics now this is just
economics but the Barons also had a bad
rap for the way they treated their labor
force in many cases such as Rockefeller
or Carnegie another robber baron he was
basically in steel they had to come
they'd come from virtually nothing and
they believed that anyone with enough
Drive could make a success of themselves
work as he wanted better conditions and
in the oil field steel mills and coal
mines life could be dangerous and
healthy and short they were deemed
troublemakers and they were dealt with
many times threats and many times these
were violence it was basically a
situation of if you want safe conditions
how about no you can see why these guys
got a bad reputation many of the larger
companies had their own police forces
and in a time where politicians and
their hands outs the real law looked the
other way
strikes and other work as tactics to get
better conditions were dealt with
ruthlessly and many people died in the
clashes between workers and owners it's
no coincidence that labor unions began
in earnest about this time workers
overheard talking about unions were
usually immediately dismissed many times
where they've broken our show for it
holy Sh this is bad I mean it's super
good to be a rockefeller back in the day
but you don't want to be the worker
these guys got screwed I don't want to
laugh about it it's pretty terrible I'm
glad like conditions up this is always
the thing like people complain about
stuff today and I complain about stuff
all the time but it's like we literally
live in a better time than ever before
like yes there's discrimination and all
of these bad things but boy whatever
your situation it was not this bad
however because of the unions
and pressure famous Expo days such as
the jungle absence and Claire's novel
about the meatpacking industry and Ida
Tarbell the history of the standard or
company about these abuses slowly things
began to change I've heard of the jungle
and I think I've read it but there was
that meatpacking thing I think was in
New York right and how horrible it was
but things began to change where they
were super slow the rise of Theodore
Roosevelt's of presidency also helped
the labor force many laws were enacted
at this time helping to curb some of the
worst abuses but they weren't all bad it
should be remembered however that
despite all of these abuses many of the
robber barons began the modern
philanthropic movement to help people in
society you've probably heard a lot of
the names because of their charity work
indeed the Rockefeller Foundation hands
out billions in charitable donation has
handed out billions in charitable
donations and still does Andrew Carnegie
was essentially the founder of the
modern Public Library System don't
donating many tens of millions of
dollars to help educate the people it's
interesting I think these guys in a way
they come from just a different time
that situation I gave with John and the
Mars bars it's like in a way you know
it's wrong because people are getting
exploited but it's also the sensible
thing maybe I don't know maybe I'm just
completely unethical but it's like I
would have that meeting with John and
I'll be like John what's that man we
others like set the price of Mars bars
it probably should occur to me but it
probably wouldn't not screwing people
maybe that makes me a terrible person
but I think these guys are a product of
their time evidenced by the fact that
they did give a lot of their money away
to charity I think they probably just
see it as a game like making money as
business and then we're good people will
just give away a ton of it universities
all over the country were founded by
people like Carnegie and obviously
Vanderbilt I guess is the famous
Vanderbilt University I've never heard
of it so yes the good with the bad
these guys just have crazy opportunities
and no regulation and they took full
advantage full all caps they did and the
repercussions good and bad they can be
seen today what do you guys think how
are these guys amazing business people
or kind of just terrible exploitative
business leaders I guess that kind of
depends on your perspective I hope you
enjoyed this video this was business
blaze those were the robber barons
now I know if you've got suggestions for
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chilling done and I'll see you next time
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