Robber Barons!

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Stuff you should read Books dot Com pre order. Now welcome to Stuff you Should Know, a production of I Heart Radios How Stuff Works. Hey, I'm welcome to the podcast. I'm Josh Clark. There's Charles W. Chucker's Bryant over there. Jerry was just here doing the COVID set up and then got out of the room really quick, held her breath for five straight minutes. It's a new record, it really, It's a new studio record. Sure. Uh, and this is stuff you should know. That's that's no David Blaine record,

by the way. No, I mean that's our studio record. You should see her when she's pearl diving though, right, wouldn't that be something If Jerry did have a secret life pearl diving, that would be amazing, it would um. But we're not talking about Jerry Chuck enough about her. Instead, I propose that we have a nice, pleasant conversation about

robber barons. Yeah, this is an interesting topic because depending on who you ask, the robber barons were either the greatest thing to ever happen to this country, right, or

one of the worst things to ever happen to this country. Yeah. Yeah, And at first, from what I could tell, historians, like immediately after in the like a few decades after UM, the Gilded Age, which we'll talk about where the you know, the age the robber barons worked and operated and lived in UM really took it to be like their their presence,

their existence was one of the worst things ever. But over time there's kind of been a reformation of them, you know, kind of like a revisiting of them that has tried to to to revive their images or actually

make their images possibly better than it ever has been. Yeah, I mean it kind of I think a lot that this has to probably depends on what you feel about, you know, capitalism to this extent where kind of doesn't matter how you make your money, if it's sort of underhanded and you sort of undercut competitors and monopolize things, that's all just free trade man, free capitalism, and that's how it works out. And then those guys ton of gave a ton of money to society before they died,

and so they that's that's all. Uh, that in justifies the means. Yeah, I actually that Yeah, that's the conservative way to look at it. UM. And I ran across something camera was called, but it's basically, oh, human imperfection. Did you know that the idea that humans are imperfect and there's really no reason to try to make a perfect society because it will always be imperfect and in ruin um that that is a corner stone, a hallmark

of conservativism. Did you know that? Uh? I didn't, But I mean, of course you can't make a perfect society. That makes sense. Well there, what so conservatives are saying that in opposition to all of the liberal um efforts to make a perfect society, to have government regulation that says no, no, we should all have clean water and we should do it at the expense of making corporations clean up the waste water before they they release their

waste into the the shared common water resources. Things like that, right, And that there's this idea that you can you can mold society into some perfect form, that that's the opposite of human imperfection, that that's like what liberals think, and that that is that right there is one of the main dividing lines between conservative and liberal. I've been on the planet for almost forty four years now, and I had no idea that it was just that simple, and

it really kind of this. I think the word perfect is what's a stumbling block for me because I don't know a single liberal thinks that they can make things perfect. I think the goal is to make things better. Yeah, yeah, agreed. I don't know that it's it's a great word either, but I think that that's you know, I mean, hey, you're gonna argue with the Stanford Encyclopedia philosophy, I'm not. I'll bring it on, man, I'll punch that thing right in the face. Speaking of Stanford, did you know that

Stanford University was named Yeah, a robber Baron named Leland Stanford. Actually, yeah, a lot of universities are named after robber Baron's. Yeah. There's a lot of problems with some of the early histories of of universities, as we'll find out in the coming weeks. So we should get into the gilded Age. We should hop in the old way back machine, because

that's the age that we're talking about. And when you hear guilded age, it might sound really great because I mean, what's better than a gilded I don't know, toilet gilded lily. Isn't that another one? That another thing people guild. I don't know. That's a pretty good band name though, Gilded Lily, Yeah, like a nineties power pop. Oh, totally, you nailed it. Not said what about breakfast, said Tiffany's. But the Gilded

Age is. And Dave Russe helped us put this together, and he points out it's not a term of endearment. When something is gilded, that means it's it's got a thin coating of gold, but underneath it's you know, it could be a gilded tird. Sure, I hate that word so much. I love it. It's so great. Yeah, I mean I hate I love it and how awful it is, Oh gotcha, But I think it's so awful it like comes out on the other side is just plain old

awful to me. So um, yeah, that's the that's the idea of the guilded Age, that it looked great on the outside, but on the inside it wasn't so great, and when it was so This was the second half of the nineteenth century, basically from pretty much the end of the Civil War up until the first decade of the twentieth century, and it was characterized by a huge, massive shift in the American economy where I saw somewhere that at some point in the eighteen sixties to some

point in the early eighteen eighties and about fifteen years, the American economy doubled doubled in size in fifteen years. That's how massive it was, and that's how fast it happened. And what it was was a transition from an agrarian society to an industrial society. And it happened virtually overnight

as far as history goes. Yeah, and it was because it happened so quickly and because it was such growth, I think the government was like, we're going to stay out of this and kind of just let you your dudes do what you're gonna do. No regulation. Uh, you can be as competitive as you want to be, and you can satisfy scratch every capitalist it you want, and we're just gonna let that happen because we're also kind

of getting rich on the side. Right, So that kind of raises something that I saw is that the idea that that it's kind of like a myth of the las a fair government. During this era, they were definitely las fair when it comes to regulation and letting corporatists run rough shot over labor. But they were anything butt hands off when it came to corporate welfare and political entrepreneurship and helping out the wealthy class at the expense

of the people in general. So in one hand, on one hand, they were las fair, on the other they were not. Yeah, and what we're talking about here is uh stuff like um snatching up resources where you could hoarding them for yourself under like building such a massive business that you could drive out every other smaller business, Uh, drive them right out of business by undercutting prices. Uh, jobs were more scarce, so you could have people work harder for less and less wages. That kind of thing,

right exactly. And what's crazy, Like it was a dog eat dog economy. Um, it was just nuts how it happened. And there was a lot of like learning on the fly, and the learning curve was extremely steep because I mean this was just basically a country of farmers who had been you know, looked down upon by Europe for a century or more, and they all of a sudden were captains of industry, and the most ruthless among them were

the ones that rose to the top. Because, like you're saying, there was no rules, there was no regulation, there weren't any standards of business. They were all figuring it out as they were going along, and they went immediately to the worst impulses that capitalism can can raise in a person when you're in pursuit of as much possible wealth as you can get, and there's plenty of it to

be had. And then, like you're saying, not only did the federal government not get involved, they weren't equipped to get involved because at that point, most of the government was focused on local stuff. And now all of a sudden, as as the United States is truly becoming a continent wide nation, um, the federal government is kind of lagging behind to catch up. It wouldn't really begin to catch

up in the progressive era. And some would say that the pendulum swung the exact opposite way to the exact opposite extreme direction that it had during the guilded Age. Yeah, I mean, let's let's talk about the guilded Age and the I guess just you owe it all the trains really and trains you owe to steal, so you gotta go back a little bit. Uh. Steel was a very big deal, uh in that when they found out Mr Henry Bessemer in the eighteen fifties found out how to

make steal like a lot cheaper. He got a new process going where it was just like a making vast amounts of steel for a fraction at the cost and speed, and all of a sudden, you could open up those local rail lines to stretch across the country and all these regional, um specialty businesses and industries, whether it was uh, you know, Cincinnati was known for furniture, and obviously in places like Wyoming you had coal, and you had copper and Montana and you had a lot of timber and Oregon.

You could get that stuff anywhere you wanted to go, and that changed everything. Yeah, not only could you get it to where you wanted to go, you could do it exponentially cheaper than it used to be overland or

stay using canals, and then also way faster too. So now if you were making like really great arm chairs and Cincinnati, like you were saying, like, not only did you have the town that they're just known for it, that's their mascot, I believe of the baseball team sitters right, Um, not only did you have the town of Cincinnati and maybe some other regional parts of Ohio as your market you know, hawd the entire country to supply with chairs, and that that happened at a really great time, the

steel coming along and building the railroads, because the United States economic engine was kind of idoling a really high rpm for a little while before this. Apparently the War of eighteen twelve caused the United States to kind of stop relying on Europe and turn inward and become much more self reliant than it had been before. So it started to exploit more industry and resources rather than rely

on imports from Europe. That was a big one. And then, um, the Civil War had brought a lot of factories online in the North that hadn't been there before, and so when the Civil War ended, these factories were all ready to go. And with the abundance of plentiful steel, that that that that engine got put into gear and it just kind of took off like a rocket. Yeah. When I was reading this and I tried to find out,

but I couldn't really get a firm hold. I wondered if back then, when this started to happen, you know how people rail against global trade and the globalization. I wonder if people railed against nationalization of commerce back then

or if they all just thought it was all great. No. No. But one of the things I read about that's actually a mark in favor of the Gilded Age being uh, actually a good thing for America is that people everyday people were super involved in politics and the political process

and agitating for what they wanted. And so if there were people who were definitely in favor of this kind of just taking off like a rocket, knitting the country together, that kind of stuff, nationalization, then there was definitely opposition parties to that too who saw the problems with it.

But the cool thing is is that everybody was involved in Everybody was like like like they cared about the direction the country was going, rather than just sitting back and being like, well, nothing we can do about it. I wonder though, if it was like if there were business, like if they were furniture makers in Cincinnati going, I don't want to sell my chairs out there. That is not what they said like in Cincinnati. Is that not

the Cincinnati accident? No, Okay, I might be thinking of Maine, right, But I wonder if I wonder who was opposing it. I don't know, I don't know. I haven't seen that one. Some of the things that I saw where one of the big fights was over currency and whether it should remain on the gold standard or whether it should be easy money, which, of course the so the farmers wanted.

I think they wanted easy money. I can't remember who wanted to stay on the gold standard and others wanted, you know, um basically, to to leave the gold standard and make money a lot more um easy to come by. The runny Dangerfield movie. That was an easy easy money. Man. That's a tawdry movie, wasn't it. Yeah, that's good though. Yeah, hey, even the worst danger Field movie still pretty great. And on that point real quick, I'm sorry, Um. I know we don't like to go off on tangents very often. Um,

but I have been watching Happy Days, I mean surely lately. Man. That is some comfort food, isn't it, Dude? They are? But not only that, it's not like junk food though. They're like well written, well acted, well directed TV shows. Like really, it's not at all like throwaway or disposable. It doesn't rely on slick special effects or anything like that.

It's just good stuff. Man. Yeah, I agree, And you know what, since we're on this tangent, we should tell everyone that we're writing a book and it's coming out this fall. Yeah, it's called Stuff you Should Know, an incomplete compendium of mostly interesting things. And you can preorder

it now if you want a special system poster. Yeah, you preorder it and you can go and upload your receipt at stuff you Should Read books dot com and then there's like a little thing that says like your pre order gift, and you upload a picture of your seat and they mail it to you and you will be very happy with it because it's pretty awesome. Yeah, and we want to sell We do want to sell these books out there. We want to sell these books all over the world. Yes, we're glad that the railroad

exists so we can move these books around easily. Oh man, you make kidding. Ship these things to Cincinnata, right, So where were we So we were shipping things regional businesses. We're becoming national businesses. People were leaving the farms, they were leaving small towns. They were going to the big city. Immigrants were pouring in from Europe. African Americans were going north because reconstruction didn't work out so well, because it

was not abandoned. Yeah, yeah, have we done one on reconstruction. No, no, we really need to though totally. I mean the more I've been I've been reading a lot about that that period in history, and yes, we need to definitely do one on that. But the point is there are a lot of people flocking to work this uh, what was called the Second Industrial Revolution where we saw a a period of about forty years, factory output went from one point nine billion to thirteen billion dollars, right, I mean,

like this happened like almost overnight. It's it's astounding how fast this happened. Um, I don't think it even happened this fast in the First Industrial Revolution, you know, the one that that um started over in Manchester. Like I think that it's this is nothing like this has ever happened in the history of the world. As far as

I know, I believe it. So um oh sure, I was just getting wrapped up my own economic engines idling high right now, Well, take your foot off the gas and let's take a little break and we'll talk a little bit about Mark Twain and uh what these a few economic stats of the day right after this. Yeah, alright, we're back, Charles. I'm feeling much better now that my

foots off. The guess that was this good advice. Well, we we mentioned Mark Twain, And the only reason we're going to talk about Mark Twain for a moment is because in eighteen seventy three he co wrote a novel. It's a satire called The Gilded Age Colon, a Tale of Today, where it followed a poor country farmer who is sort of I mean, does he move to the city trying to get in on the Second Industrial Revolution? Yeah, totally. It's it's exactly that kind of migration that you're talking

about just a few minutes ago. And it didn't work out so well, right, I don't know, I've never read the book, but from from what I can tell, um, no, it didn't work out very well because he is taking advantage of by all manner of bad people like crooked politicians and crooked businessmen, um. And it is basically run through the ringer from what I can tell. But for I've also seen that that wasn't it wasn't exactly the best piece of writing Mark Twain's ever come up with.

But the thing is that he releases in eighteen seventy three, and this is like at the very beginning of the Gilded Age. So he saw it pretty quickly what was

going on. And what he saw was this emergence from a relatively egalitarian society of a group of ultra mind bogglingly wealthy people that just rose up from the United States and through you know, cheating and business acumen and taking advantage of people and overworking people and underpaying people, but also like having a lot of vision and foresight, all the these things coming together grab control of almost all of the wealth that was being produced by the

average American, and all of the average Americans put together, who had moved to these cities for the promise of better wages, better living than the farm could offer. Some people were exploiting that more than other people, and those people came to be known as the robber barons, and they were the lynch pin of why people think of the Gilded Age as a rotten part of American history. Yeah,

here's some stats for you. In eighteen ninety, the top one and this they should all sound very familiar if you're alive and breathing oxygen today, But in eighteen ninety, the top one percent of the US owned fifty one percent of all wealth. Yeah, dude, more than half of all wealth in that nuts. It is nuts, but you're right, it does sound very familiar. The top twelve percent owned eighty six percent of all wealth, and the lower fort of the US population, which was about half the population,

owned one cent. Uh. And here's that's even more nuts. Well, I mean all these just top one another. I think here's the last one. Uh in even the richest four thousand families. That sounds like a lot of people, but that's less than one percent of the population. The richest four thousand had as much wealth as the other eleven point six million families combined. Yeah, how about that? So that is what you call economic inequality, right, And I

think the thing is is especially over time. But I get the impression during that age too, like the people who resent that, liberals typically um tend to be painted with this brush that says, you're just jealous. You've never made that much money in your life, you probably never will, and it sickens you to see somebody else with that

money because you don't have it. And it's that second part, that last part about because you don't have it, that I think misses the mark work, and that even at the time, during the guilded guilded age today when people look at it in quality, that kind of stuff, what there what a lot of them. I'm sure there are people out there who are just jealous and haters for that reason, but a lot of them say no, no, like that, that that level, that that amount of disparity

shouldn't exist. Where if if there are people who are just genuinely suffering, who are just poor and aren't able to make it with whatever living they're making, um, if they exist, they shouldn't have people who have that much amount of money. And that was a sentiment in the guilding guilded age is much too. It wasn't like they

didn't realize this was going on at the time. Um, the sentiment was very much like it is today, except in the Gilded Age they did things like form labor unions and strike and um, and just basically did something about it. They didn't take it laying down, which is actually criticism that's levied or has been levied in the past against people today. Yeah, and I think there's also a notion that the more left leaning people are anti success, and that's that's not true either. It's um, well, that's

all I'm gonna say about that. That's just not true. Okay, it's just not true. They're they're not asids, they're not anti success um. And and I don't think that every conservative thinks like, yeah, man, that like it's all fair and you should be able to do whatever you want to get ahead and stomp on any one's head that you want to get there. I think these are just broad brush um things that keep the country divided. Yeah, absolutely, I think that. Uh yeah, I think most both sides

misunderstand each other. Conservatives and liberals misunderstand each other to a debilitating degree these days. Agreed, So let's let's get off that. Let's go back to the original the o g robber barons who were not to these guys, I'm talking about the term robber baron, which didn't happen in the nineteenth century US for the first time. It happened thousands of years ago in Europe. I don't know about thousands of years, but pretty close to, pretty close to eight,

I'll give you that. So um, apparently along the Rhine River, if you wanted to move goods up and down northern Europe like that was your your way to go. But unfortunately for you. There were places where the Rhine river like really narrowed with high cliffs, and you were easy prey for local nobility who wanted to like set up toll booths basically and said, you need to give me some money if you want to keep going, implying your

goods along the Rhine. Yeah, and you had You couldn't just portage your steamship up a mountain and over a mountain. You had to pay the piper. Plus they didn't exist at the time. What steam much hips? And when did those come around? Uh? They early nineteenth century. You have a much better just general world timeline that lives in your brain than I do. Well. I understand history perfectly and without any um delusions or any of my opinions informing my vision of history as well. I think that's

what you're known for sure. Uh wait wait were you joking? Oh no, okay, I just always get the time periods confused, So I rely on books and research like a big dumb dumb so so do I. Yeah, no, but then you keep it in your brain. Mine just floats out like like you ever cartoons with birds flying around people's head when they get knocked out. Chuck, I've seen every cartoon that ever existed, and I remember each of them perfectly without any of my opinions coloring my view of them.

Those birds are always above my head. I don't have to get hit with an antiville or a piano. So the Ryne Gorge was one of those really narrow straits, and uh in twelve fifty Emperor Frederick the Third died. There was no successor, and basically that meant no regulation. And believe it or not, even way back then, a lack of regulation meant that people would take advantage of that.

That's the same as it is today. It's almost like people are imperfect, almost, And so these thieves would move into that gorge, jam up those tolls, maybe just steal stuff if they wanted to as well. And they were named the robber barons. That's where that term came from. Those people, yeah, because they actually were like low level nobility and they already were well off, but that didn't prevent them from, you know, trying to take advantage of the merchant class who were just trying to make their

way and make a living. And that became like a really great description for some of the the most successful business tycoons of the nineteenth century. I think it first popped up in an Atlantic article in eighteen seven d Yeah, where it didn't directly say that, it didn't say that these guys are the new robber barons, but it said that the old robber barons of the Ryan Valley were actually probably more honest than the new aristocracy of swindling millionaires.

So that's a big, big time burn. So even in eight seventy people were saying, like, this is wrong, there's something like really wrong here. I mean, this is within just a few years of the Guild of Age really starting to take off, and people had already identified that there were some major issues developing. Yeah, it's so weird to look at this stuff and just how apt it applies to what's going on today. And we think, I think some people think that these are all new problems

and new issues, but it's as old as time, you know. Yeah, it's so weird. It is a little weird to too. It's it is weird. What's even weirder, though, is like I believe if we if we look back, if we zoom out far enough, we see humanity kind of ever going upward, even though there's like peaks and valleys in the line. The line overall is kind of up moves upward towards something great, I think, but toward perfection. I wasn't Maybe I wasn't. Uh, I wasn't alive ten thousand

years ago, So who knows. Maybe that was the pinnacle of human existence. I don't know. Maybe. So should we can say, should we talk about a few of these dudes? Yeah? So, um we I feel like we have kind of set this up that the robber barons were ruthless business tycoons, and we're going to start with one of the first ones, Commodore Cornelius Vanderbilt, who, for my money, was the o

G robber baron. Yeah, and Commodore is a nickname, um that, and as you will see he later, Vanderbilt University is named for him, and their mascot is the Commodore's because of him, and a commodore as a naval officer sort of above not quite an admiral, but above the captain a fleet. Oh well, that's actually pretty appropriate because he

did command a fleet of ships, originally sailboats. Originally a sailboat I think when he was fourteen and then um, steamships to ferry people around um, New York, there were by this time, and you know, you know what's ironic. We were talking about steamships and when they were invented. The guy who invented steam, Robert Fulton. Remember we did

a whole episode on steam technology. He had a thirty year monopoly UH in New York to ferry people using steamships, and ironically, Cornelius Vanderbilt had to overcome that monopoly UH using ingenuity and his own resourcefulness and eventually was successful in breaking that monopoly just through good business tactics that actually resulted in far lower fares for everyday people and companies.

I think just at his first try, UM, by improving the size of the steam engine and using cheaper anthracite coal, he managed to drop the average ferry price from like seven dollars to three dollars and his first try. That's amazing. Yeah, So so I think that's really kind of like instructive though,

man Like think about it. You think of this guy's like a ruthless robber baron, and in many many ways he was, as we'll see, but he was able to get to that position by by outwitting and outsmarting other robber barons, and that was the climate at the time. Like it's so easy to sit back from this time and just be like just judge, judge, judge. And it's actually kind of fun too, it's a great pastime. But you also have to remember at the time, um, that

was that was the business climate. That's just what it was. And if you weren't willing to do that, well, then you were not going to make it in in business. Which is fine, Like maybe you'd say this is too cutthroat for me, I'm just gonna sell out to these guys, um, and there's nothing wrong with that. But the ones who were left standing are the ones that you know, history still remembers, for better for worse. Yeah, and it's worth pouring out, um. And as we'll do with I think

we're going over four of these guys. But some had money born into it, some started out very poor. And um, Cornelius Vanderbilt, even though that sounds like such a rich, hoity toity name, now, uh, he was born very poor. He was born in sevent uh in a farming family on uh Staaten Island and quit school when he was eleven. And that's when he started working on the boat docks, and he he was literally a self made man, starting with that first little ferry boat that you mentioned at

age fourteen. Um. He was a big dude, and he was very savvy but also very ruthless. He and this is something that you'll see with a lot of these men, was a competition and a competitive edge and nature. That was sort of the underlying thing with all of them. I think that I watched There Will Be Blood recently for movie Crush and Daniel Plainview was very much based on some of these robber barons and that he has that great, great classic line from that movie when he goes,

I have a competition in me. I want no one else to succeed, and that just crystallizes that character. And I think a lot of these guys it wasn't enough to just get rich. They wanted to devastate the competition, right. So it makes you wonder, like, is that just a normal There's just at any given time there's a you know, a handful or a multiplicity of people who are like that. It's just that these guys happened to be living in a time where they had the freedom and ability to

exercise that to their to their greatest ability. Or was it that these guys shaped the business world because they all happened to be alive at the same time. I don't know. It's it's interesting though that it's that competition, and again with the plane view, not just a competition to succeed, but accompassing competition to see that others don't. Right. So, um, did you talk about the railroad yet? I didn't catch it. No. So you know he started off in the steam uh, steamboats.

But if you know Vanderbilt, you know he was a railroad guy. And if you look at the list of robber barons, uh, I'd say easily like a third of them were railroad men. Yeah. Because there was so much money to be made from the railroads. It was just like printing your own money. And one of the reasons why was because there's so much stuff being shipped over the railroads that if you own the railroad, you gotta cut of every single industry because every single industry basically

had to use your form of transportation. That's why they all got into it. Plus it was wide open, like there was so much open space and so much room for expansion that it was a it was a good time to get rich off of the railroad for sure. So his first railroad ride was at thirty nine years old. He wasn't like in his twenties and early thirties getting into the railroad business. He wasn't even on a train

until it was almost forty and that train crashed. Uh an axle broke and went down an embankment and he punctured along broke some bones, and I guess was lying there wheezing out of a hole in his long saying, this is the future. That was so great, and he got into railroads. It's it's crazy, like a year later, Yeah, he did. And one of the things that he had a really great talent for was identifying like loser railroad seemingly loser railroads and figuring out ways that they actually

had been overlooked in. A really good example of that is the Harlem Railroad, which was just a short little line other railroads, larger railroads used to connect to New York City, but Vanderbilt recognized that it was the only line that went all the way into the heart of Manhattan, and so he bought that up. And he also at the same time not only got control of that little railroad. This is a really early chance for him to show

how good he was at driving up stock prices. So when he came along and bought the Harlem Railroad, or started buying shares of the Harlem Railroad, that was worth in today's money, a hundred and sixty eight dollars of share, not too shabby, but from what I could tell at the time, not very great at all. By the time he was done cornering this stock um, he had driven the shares up to fifty hundred and ninety eight dollars

in just a few years. And so in doing so, not only did he make a ton of money for himself, he also developed this reputation that made owners of other railroads say, I own a bunch of shares in my railroad. You want to come buy mine and drive my stock price and then buy me out. And so he didn't. He didn't even have to plunder other companies. They came to him and just said, here, buddy, Bias please. They were Blue Star Airlines. What is that? Remember that from

from there will be blood. There were no airlines and there will be blood. Remember Wall Street That was the one that Martin Sheen worked for. Yeah, that Geko came in and bought out and uh, I think he shuddered them though. That was the difference. Yeah, yeah, he was a corporator, he he Uh. And actually that era, the eighties junk bondera, is frequently cited, or it was at the time as the Second guild at age. This is not the first time. We're living in what's known as

the Second guilded age. So to put a bow on Vanderbilt, he uh consolidated, like you said, all these railways between New York and Chicago. He manipulated stock, he fixed prices. He the guy, like he said, earlier government wasn't looking so you can kind of do what you wanted. And he became a very very very wealthy man, and like a lot of these guys, late in his life, turned into a philanthropist. UM built Grand Central Station. It was called the Grand Central Depot at the time, UM which

during the recession provided tons and tons of jobs for people. Uh. And then the Central University of Nashville was eventually renamed Vanderbilt University because all he did was give him a million bucks. Isn't it crazy significant? Like I feel like we could get stuff. You should know listeners to pitch in and get a university named after us. Let's try that. Actually like stuff you should know you we could do. Uh, we can morganize the struggling university. How about that? Hey,

one more thing about Vanderbilt. So he left about a hundred million dollars to his mostly to his eldest son, William. In six years, William doubled that, mostly by investing in railroads. That's how much money you can make in railroads. And William was also well known for throwing probably the most lavage party in the history of New York City. Um, they spent one point eight million dollars in today's dollars on champagne alone. Yeah, that was when he finished his

mansion on Fifth av And Uh. I looked it up because to see if any of these robber baron mansions were still around today. But yeah, I don't, Yeah, I don't think it. I mean, I know this one was demolished in ninety. So if you want to get a really good idea of just how rich these people were, go to Newport, Rhode Island and visit Millionaires Row, because there was a huge there's a huge overlooking this cliff.

There's a long row of the most astounding mansions you've ever seen built during the guilded one of the better walks you can take in life. It really had the ocean on one side and then these mansions on the other. It's really cool and each mansion, each mansion is so different from the others. It just touring them is amazing. You could just be utterly disgusted by the concept of billionaires or robber barons or whatever, and you can still

enjoy taking this tour of these mansions. They're just works of art, you know. It's really it's really worth a visit. Plus Newports just one of the more charming towns in the kind I love Newport. Or you could take a hate walk and uh, just look at those mansions and think about what what wrecking ball would look like, shake your fists at the dumb waiters and all that. But then you turn around, look at the ocean and think, okay, all right, it's really cool. It's like, it's a definitely

cool to visit them, for sure. And by the way, a little piece of trivia if you go, if you enter Central Park at the hundred and fifth Street entrance, that big beautiful iron gate was from that mansion, the Vanderbilt Mansion. They donated a lot of the stuff before they demolished it, is that right? Yeah? So I mentioned organization and that's actually named after the next robber Baron we're going to talk about. Okay, do we break beforehand? And I think we'd break after p how about that?

Are you okay with that? Okay? So so then we're gonna hang in there. Everybody doneat don't fast forward yet, We're going to stick around and talk about JP Morgan right now. Yeah. He was born with money. He did not come from meager means and work him stuff up

by his bootstraps. He was the son of a very successful banker and merchant and used those connections to get a plumb job at Wall Street when he was twenty years old, and then when he was in his thirties, he partnered partner with a guy named Anthony Drexel who was a banker, uh and from Philly and created Drexel Morgan and Company. And it became one of the biggest investment banks at the time in the world. Yeah. Um, And this was when he was in his early thirties,

like you said, right, so um. JP Morgan was known as the guy who financed all the other robber barons um, and he had his fingers in basically every pot that was going on. He also knew that like, you could make money off of the railroads because you're taking a cut of all the other industries, so he definitely got involved in them. But his whole thing was um what's called horizontal integration, where you you you basically come along you say this industry should be doing way better than

it is. I think there's too many competitors and they're all holding one another down. I'm gonna slowly start buying them up. And here's the thing. This is how you get control of a full industry during the Gilded Age. You go to a couple, you start buying them up, and then you put all those together and you you form a bigger company that's way leaner, has much better economies of scale, and you can compete better against all

the other guys. So you start buying some of the other guys up because they're facing going out of business now. And then you've got left the real holdouts, the ones that are never going to sell to you because they hate your stupid face and they'll never give a penny to you make sure that you'll never set foot in their offices ever again. And what you do then is

you start selling for us than costs. Yeah, you're a big company, so you can totally stand that for a much longer time than these holdout competitors, and they face either financial ruin or you eventually put them out of business,

and either way, you no longer have that competition. You literally control an entire industry consolidated into one beefy mega company, and all of a sudden you have what's called Morganization, which was I don't know if that was pioneered by JP Morgan, but he definitely perfected it enough that they named the process after him. Yeah, and that's a good example of what I was talking about earlier, is it's not enough to succeed and be successful, but to make

sure no one else can be. So like it would be the kind of thing and that one company you were talking about that maybe kind of pretty small even, but they might might hold have an iron grip on one very tiny region of the United States, and you could just let them have their business, or you could do what you're talking about and make sure that you uh squash them by any means necessary and forced them to sell. And that's I think that's where capitalism for

a lot of people has gotten its bad name. Is like, yeah, work hard, succeed do well, but not at the expense of every other person trying to do well, right, because it interferes with something this country is based on, which is called the quality of opportunity, which is the idea that at least under the eyes of the law, every single person in America has an equal shot at making it, at making something of themselves, of having like a good life.

And when somebody is cheating or engaging in monopolies or using underhanded tactics to to run out the competition so that there is no competition any longer, that that is problematic. That that flies in the face of the idea of equality of opportunity. That's right. And if you listen to our Monopoly game episode UH, you might remember that JP Morgan was the basis of uh monopoly Man. Yeah. We talked about that good. Okay, that makes me feel good. Yeah.

He was modeled after old JP Morgan himself. Uh. And he was actually one of the first people to be targeted um for antitrust in nineteen o four, Teddy Roosevelt came after him under the Sherman Antitrust Act and said, hey, this Northern Securities Corporation, uh is really monopoly? And Supreme Court said, yeah, it is busted up. Yeah. And so today when we think of trusts, we think of like, you know, a legal entity that that can hold um assets.

At the time, the word trust meant basically an industry that had been morganized, where all of the competitors have been folded into one large company and the market was cornered by this one mega company, General Electric, UM U S. Steel, Both of those were morganized companies. And apparently U S. Steel was the first one billion dollar company that ever

existed because of that that level of consolidation. But then, yeah, when the Sherman Anti Trust Act was passed in nine, that was a clear sign that that this was not going to stand much longer. And and I think Roosevelt, it was Roosevelt, you said, right, who busted that up.

And he ran on that and actually went against He was a Republican, I believe, and he went against the advice of the you know, the elder statesman in the Republican Party established himself as a genuine UM President of the people and helped set himself up for reelection just from that one anti trust act. So that's j P. Now do we take a break. Oh one more thing, Chuck, I'm not toying with you, I swear so. One one of the ways that Morgan one of the reasons he's

reviled still. And he did some philanthropy, probably more than he gets credit for, for sure, but UM. One of the reasons he's revival is because one of the ways he made it so that he could compete with other companies was UM and sell for lower than than cost was by slashing wages, slashing the workforce and increasing productivity of the existing workers, and then just making sure that

working conditions. He didn't spend a cent on improving working conditions to make them safe, and that that is really not why not because he amassed a fortune. Some people criticize him for that, but it's tactics like that, like like becoming a billionaire basically UM on the backs of people who he wouldn't have spent a cent to make sure could stay alive working in his factories. That is the quintessential problem people have always had with robber barons.

Is that kind of mentality? That's right now, I'm done. All right, we'll come back right after this and finish up with two more robber barons. Hello, everybody, we're back to talk about Andrew Carnegie. You've ever been to Carnegie Hall or Carnegie Mellon University. I've been to both. You've been to one of the university with you. That's right. We did a little job there one time. That was fun. I've been to Carnegie Hall. I would I ushered a

show there. I didn't usher. I passed out the playbills, which meant I got to see the show for free. And I saw it. Oh man, it was one of those special nights. I got to see Beethoven's Night with the full orchestra and German choir at Carnegie Hall. It was amazing. Wow. Something else that's pretty neat And all I needed was a boat? Is that the one that's um? Maybe I named it wrong. It's the dune dune dune, dune, dune dun dun un. Oh, the die Hard song. Yeah, the die Hard song. I got you and saw die

Hard in concert. It was great. Hious. So Carnegie, Uh, we're talking about Andrew Carnegie who was born in Scotland and they came to Pittsburgh. He was very poor. He's about thirteen years old and he worked in a cotton factory and he and this will come into play later, he kind of self taught himself from books that he borrowed from a wealthy benefactor from his private library, which is will come to play later. His favorite one was

Flowers in the Attic. Wow, I would have thought great expectations, but that's okay, no, So he Um, he, like Vanderbilt, is a definitely a self made man for sure. And I guess he kind of was. He had his fingers in a lot of different pots, kind of like JP Morgan at first. And then he turned his attention to steel because again remember steel is like the basically the

the foundation for this American economy just blowing up. Sure, so he he his name became synonymous with steel, and I guess at first, up until about eight two, he had a reputation as being a friend of the worker, and that the workers at Carnegie Steele in Homestead, just across the river from Pittsburgh. Um, they they felt like,

you know, Carnegie would take care of them. Um, and They found out the hard way that that was not the case when they went on strike in two during what came to be known as the Homestead Strike, which would result in the death of ten people, which is not how they planned things to go. Uh. And apparently the reason why that happened is because the Pinkerton's were called in as strike breakers. Yeah. I might want to eventually do an episode on this, but um that that's

sort of the overview. You bring in the Pinkerton's and then they battle with the like literally with guns. Pinkerton's died. I think like eight or nine of the ten or twelve people that died rode the Pinkerton's. No, No, I think it was just one I think were the strikers. Yeah, okay, well we should definitely do a full episode then, because

for sure I want to get this right. But but what I read was that the the strikers, Um, so, the Pinkerton's showed up in barges and they were basically hired on as a private army to protect scab workers and and bust the strike up. Um. But they arrived in barges and after the initial violence, the striking workers and some of their families surrounded these barges and demanded that the Pinkerton's come off the boats, and then the Pinkerton's. So the Pinkerton's said, Okay, we'll come off if you

guarantee our safety. And they said fine, and the Pinkertons came off and they got beaten by all of the strikers. They just completely went back on their word and then set their barges on fire. I guess the Pinkerton's escaped to the factory with their life, and um, the National Guard was called in to quell the violence. Yeah, well, National Guard was called in not only to quell the violence, but also called in to act in the interest of Carnegie.

So he kind of commandeered at his own little personal army to help take care of things right, starting with the Pinkerton's and then with the National Guard. And it's like this kind of collusion that is also another huge criticism.

Like we were saying, the government is known for being like las fair as far as the regulation is concerned, but they'll totally send in the National Guard not just to quell violence, but to make sure that the strike breakers don't attack the scab labor to keep the factory going. And that that that kind of like government capital collusion at the expense of the workers. Is that is there's a long standing edition of of that being almost universally reviled in America over enough of an arc of time.

If that keeps up more and more just everyday, Americans start to notice and start to resent it, and that apparently is a really good force for social change, because Americans don't like that kind of thing after a long enough period of time. Yeah, And I think Carnegie tried to distance himself from that strike by saying that he was sort of out of the loop. He was in Scotland the whole time, but they have since found correspondence that shows that he was very much involved in that.

And you know, there's some speculation that he may have had some genuine moments of regret and guilt over that, because he was a big time philanthropist later in life. I think he said in his book The Gospel of Wealth, the man who dies thus rich dies disgraced. And uh, we mentioned the libraries coming back into play. He more than libraries, and that's really one of his big legacies, along with um the arts, the Carnegie Corporation, and the

Endowment for International Peace, Carnegie Mellon University, Carnegie Museum. But the libraries really have made a pretty big difference in this country. They really have, for sure. Um. And he was one of just the all time great philanthropists in American history for sure. Um. But he still pales in comparison to the the all time top record holder philanthropist, John D. Rockefeller, who is also Robert Barroon. But he also is far and away America's most prolific um and

generous benefactor for sure. He was also one of the most visionary philanthropists of all time too. Yeah. And some people say that he was, you know, if you just account for money and inflation, the richest man ever to live. Um. I'm not sure how they calculate that, because his nine hundred million dollar UH peak in nineteen twelve is about twenty three billion today. So here I saw how You're ready.

I'm sure it's yeah, go ahead if you do. His wealth relative to the total economic output is an even larger figure than gross domestic product. Had a feeling it was something like that his wealth represented two percent of the total economic output of the United States of the time. To to have that value today, you would have to be worth about three hundred and fifty billions, and I think Jeff Bezos is worth hundred and forty or something

like that. Yeah, And I think we didn't even mention it was it Carnegie that had at one point like one dollar of every twenty dollars in circulation was his. Yeah, that's right, that was Carnegie for sure. Yeah, I mean these numbers are staggering, for sure, people like Rockefeller and

Carnegie is just it's unbelievable. But the thing is in in like like John John D. Rockefeller was a ruthless, ruthless businessman who put a lot of people out of business, brought a lot of misery and hardship on just small everyday producers of oil, which we'll see. But again, it's really difficult to overstate the impact that his philanthropy has

had on the United States. He peaked at nine million, like you said, when he died, he had he'd given away everything but twenty six million of that, and he probably felt kind of bad that he had twenty six million dollars left because he had He was a very religious man, and apparently he um learned very early on that it was every man's religious duty to make as much money as you possibly can and then to give

away as much money as you possibly can too. And he he apparently lived that even before he was wealthy, when he was still just an average worker, he would give away something like ten percent of all of his pay check. So he was a philanthropist his whole life, for sure. He was still a robber baron too though, yeah, and his whole you know, of course, oil was his business. Standard oil, um, it was just a goliath and there and there were a bunch of big like sort of

like the railroads. It was oil, and the railroads were industries where you could have a bunch of people that had these huge, huge corporations. But Standard Oil was far and away bigger than any of them. By the early nineteen hundreds, they controlled more than of the oil market, can you imagine. And the way that he cornered the market was, you know, he did that standard organization kind of thing where he went around and bought it first and then started to turn up the heat on the competition,

on the holdouts. But one of the ways that he turned up that heat was he colluded with the railroad, um, the different railroads in the area who were shipping all this oil. To say, not only were they going to give him a rebate so he got money back where they wouldn't give money back to other oil shippers just because of you know, volume, That makes sense, but they also had to get his business, and he had so

much business that they would do this. They the railroads had to tax and added tax on all of his competitors, so they paid an extra twenty to thirty cents of barrel to ship. Not just paid more than he did because of his rebates, they paid more in addition to that just for not being John D. Rockefeller. And then on top of that, to keep him from taking that rebate and going around to other railroads and getting a cheaper rebate and abandoning that railroad. Um, they actually gave

him a kick back of that added tax. So his competitors were getting taxed by the railroads and he was actually getting some of that tax himself too. You just can't possibly compete with that, and it put a lot of smaller oil producers and shippers and refiners out of business. It's amazing, it is. Uh. Let me see, he gave seventy five million away to the University of Chicago. Well, it kind of founded the University of Chicago with that money.

Also Spellman too, which was established to educate freed slaves. Um he he he bankrolled Spellman for its founding as well. And in one of our best and most favorite episodes you might remember the Rockefeller Sanitary Commission helped eradicate hookworm in the South. That is one of our better episodes for sure. So those are just four of the uh sort of most uh famous and some might say notorious.

Robert Barons big long list. You know you could throw Henry Ford in there, uh, John Jacob Astor, Charles Schwab, Andrew Mellon, Jay Gould, Yeah, I looked at I was thinking about J. Paul Getty, but he was later on he wouldn't have qualified. So some of these guys had some terrible quotes to that also just made them despised

through history. Um. Carnegie said that, uh, it's not the man who does the work who gets rich, it's the man who gets other men to do the work, which is not a very tasteful thing to say when you're ultra wealthy and breaking strikes with guns. Um. That Jay Gould guy I mentioned, He said that he could hire one half of the workers in America to shoot the other half to death if he wanted to, which is another nice thing to say. And apparently John D. Rockefeller

once said competition is a sin. So these guys had some terrible pr um and because of that a lot of people have said, like, well, I wonder if some of the ultra wealthy industrialists or innovators or people who basically the billionaires who are leading the world today are are they just like Robert Barns with better pr and better marketing. And apparently supposedly that's not necessarily the case.

And here's why. Remember I was saying that like Robert Barons were kind of being reformed by historians these days, especially conservative historians. Well, they point to some like really indisputable things like these guys were ruthless, and they engaged in horrific anti competitive, uh kind of anti capitalist tactics to to get those that wealth, and they did it on the backs of workers that they took advantage of

and didn't pay very well and um killed in their workplaces. Basically. Um. But the reason that America is still powerful today is because of the work that these guys did of the the industries that they created. UM. Public schooling came about and was kind of became widespread to prepare people for the jobs that these guys created. UM. And you really can't, you can't look away from the fact that some of them were the greatest philanthropists that the country has ever produced.

To UM, the that flies in the face with kind of the exception of Bill Gates, it flies in the face of the people who are around day, UM that that not only are they not great phil anthropists necessarily. I'm looking at Steve Jobs, who wasn't around anymore, but definitely was not a good phil anthropist in his life. He is now, his family is, but he wasn't when he was alive. UM. That's a big, big mark against people who have control of significant portions of the wealth

in America today. But also even more than that, those guys today are they're presiding over a decline, the decline in wages, decline in living conditions, whereas these guys, these captains of industry and the robber barons from the nineteenth century, they were presiding over a rise, like an improvement in UM, the the way that America lived and the standard of living, the kind of the polar opposite, even though the inequality is roughly the same. Very interesting, I think so too.

I also wonder, though, too, if the this this inequality will usher in a second progressive era where it seems like it has all of the markings to do that. We need to do a progressive era episode too sometime. Okay, alright, well, since you said deal, Chuck, I think that's time for a listener mail. Huh. Yeah, I think I alluded to this in another one about the word marijuana. Didn't I talk about that totally? But I didn't read the mail, right, not that I remember. Now, all right, this is from

Jack Glick. Hey, guys, love the show. Been listening for five years or so, to make sure not to miss any new episodes, listening to the one on Macha when you started to talk about marijuana, decided to get in touch. I am the lead analyst on cannabis taxation for the Canadian federal government, and we long ago made a decision

to refer to the plant by its proper name cannabis. Uh. Marijuana has a number of historically racist associations, and I know you guys are always using wary of using appropriate terms for things. I had a good laugh at the question over whether womb was still okay to say in the ultrasound const I thought, you'mily to know that how outdated and implicitly offensive marijuana is. And I'd like to encourage you to use the word cannabis when referring to in the future. All the best, keep it up. That

is from Jack Glick. That is a great name, Jack, great job, great name, great email from a great guy. I assume it sounds like a great guy. If you want to show off what a great person you are, you can email us yourself like Jack click did mean what a great name? Um. You can wrap it up, spank it on the bottom, and send it off to Stuff podcast at iHeart radio dot com. Stuff you Should Know is a production of iHeart Radios. How Stuff Works.

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