Celebrating the History of Business in the United States of America
As the American Revolution came to an end, America was born on July 4th, 1776. The nation was founded by those who yearned for freedom. With that came innovators, individuals who wanted to start something, and those looking for work. Thus, American corporations started developing in the 1790s. These budding corporations soon became vital to the new nation’s economy.
The First Major Corporation
Although corporations date back to the 1790s, the first major corporation was the Boston Manufacturing Company. Founded in 1813 by Francis Cabot Lowell, the Boston Manufacturing Company focused on the making of cotton textiles. Lowell took the plans for his business model from England as the first corporations were created in Europe. However, before the 17th century, these European corporations were very specific in that they were only used for the good of the public, anything that was not for that use was prohibited. At the time, the Boston Manufacturing Company was the largest factory in America employing a workforce of around 300.
Corporations During the Gilded Age
The Gilded Age proved to be a formative time for corporations in America. Oil, electricity, and the growth of railroads aided in the development of American corporations. These developments became opportunities for business ventures and created more business. During the Gilded Age, the American Industrial Revolution took place. Corporate structure supplied business development and capital that stoked the flames of the American Industrial Revolution.
Since many corporations were founded in America’s early years, the Gilded Age allowed the U.S. to become one of the chief economic powers of the world. Another reason for their quick rise to the top was that corporations were incredibly easy to start. The nation was young so there weren’t laws for corporations and the steps to start one was simple. The very thing that pushed America to the top ultimately threatened to tear it down at the core.
Due to the lack of regulations and restrictions, Robber Barons were prominent. Robber Barons were businessmen who were considered unethical in the way they handle their business. Robber Barons manipulated the market, creating monopolies. This eventually threatened capitalism. However, the enactment of the antitrust legislation in the late 1800s combined with state regulation and taxation combatted these Robber Barons and their monopolies.
The Great Depression
Corporations in America took a turn for the worst when the Great Depression hit in 1929. The Great Depression was the biggest economic crisis in the industrialized world. Impacting the globe, the Great Depression lasted until 1939. Many Americans saw big corporations as the reason for the downturn. Franklin D. Roosevelt put policies in place like the New Deal to revitalize the country with opportunities for businesses and jobs.
After the Great Depression and World War II, corporations in America were able to rise and gain what they had lost. However, states intervened again during this time to enforce labor laws and ensure that monopolies were not dominating the market. As American citizens started to care more about the environment and make sure labor laws were enforced, activism throughout the 60s, 70s, and 80s pushed for labor and environmental standards to be enacted and enforced. Despite the steady rise of corporations in America, they continue to face challenges from large global corporations in a competitive international market.
In 2020, American corporations along with the rest of the world were hit with the coronavirus. This global pandemic forced many corporations to shut down or slow their plans and instead put their energy and resources towards survival both personally and professionally. Large corporations, as well as small businesses, were negatively impacted by this, but throughout the pandemic, a support small business movement helped many smaller corporations survive. People found meaning in supporting local businesses rather than big corporations and underlined the importance of it as it spread through social media.
As we celebrate the birth of our nation this Fourth of July, we also celebrate the many businesses (large and small) in the United States who drive our community, state, and national economies and provide jobs to the American people. Join us by supporting small businesses in your community.
Dye Culik PC is a business and franchise law firm in Charlotte, NC. We love helping businesses protect themselves and grow safely. Mention this Fourth of July blog for a complimentary consultation and Happy Fourth! Follow us on Instagram at @dyeculik for the latest updates.