In social criticism and economic literature, Robber barons became a derogatory term applied to wealthy and powerful 19th-century American businessmen that appeared in North American periodical literature as early as the August 1870 issue of The Atlantic Monthlymagazine. By the late 1800s, the term was typically applied to businessmen who used what were considered to be exploitative practices to amass their wealth. These practices included exerting control over national resources, accruing high levels of government influence, paying extremely low wages, squashing competition by acquiring competitors in order to create monopolies and eventually raise prices, and schemes to sell stock at inflated prices to unsuspecting investors in a manner which would eventually destroy the company for which the stock was issued and impoverish investors. The term combines the sense of criminal ("robber") and illegitimate aristocracy (a baron is an illegitimate role in a republic).
We hear now on all sides the term "Robber Barons" applied to some of the great capitalists. ... The old robber barons of the Middle Ages who plundered sword in hand and lance in rest were more honest than this new aristocracy of swindling millionaires. —Lida F. Baldwin, quoting the August 1870 issue of The Atlantic Monthly, writing in 1907 about how little business had changed in 35 years.
The term robber baron derives from the medieval German lords who charged nominally illegal tolls (tolls unauthorized by the Holy Roman Emperor) on the primitive roads crossing their lands or the larger tolls on ships traversing the Rhine—all such actions without adding anything of value, (see robber baron) but instead lining one's pockets to the detriment (added costs) of the common good.
U.S. political and economic commentator Matthew Josephson further popularized the term during the Great Depression in a 1934 book by the same title. He attributed the phrase to an 1880 anti-monopoly pamphlet about railroad magnates. Like the German antecedent princes, Josephson alleged that American big businessmen amassed huge fortunes immorally, unethically, and unjustly. The theme was popular during the Great Depression amid public scorn for big business.
After the Depression, business historians, led by Allan Nevins, began challenging this view of American big businessmen by advocating the "Industrial Statesman" thesis. Nevins, in his John D. Rockefeller: The Heroic Age of American Enterprise (2 vols., 1940), took on Josephson. He argued that while Rockefeller may have engaged in some unethical and illegal business practices, this should not overshadow his bringing order to industrial chaos of the day. Gilded Age capitalists, according to Nevins, sought to impose order and stability on competitive business, and that their work made the United States the foremost economy by the 20th century.
This debate about the morality of certain business practices has continued and many modern industrialists and media moguls such as Rupert Murdoch,Donald Trump and powerful rich individuals who hold political office and control media entities, such as Vladimir Putin in Russia and Silvio Berlusconi in Italy are referred to as robber barons by their critics.
List of businessmen who were labeled as robber barons
In 1975, students at Stanford University held an election to choose a mascot for the athletic teams and voted for Robber Barons. The university's administration refused to implement the vote, and the teams remain without an official mascot, instead being referred to as the Cardinal. (The university's colors are cardinal and white.)
Folsom, Burton W., and Forrest McDonald, The Myth of the Robber Barons: A New Look at the Rise of Big Business in America (1991).
Goldin, Milton. "Andrew Carnegie and the Robber Baron Myth". InMyth America: A Historical Anthology, Volume II. 1997. Gerster, Patrick, and Cords, Nicholas. (editors.) Brandywine Press, St. James, NY. ISBN 1-881089-97-5
Josephson, Matthew. The Robber Barons: The Great American Capitalists, 1861–1901 (1934).