The Standard Oil Company (and the trust associated with it) was an economic game changer for America and tarnished the ideals of purist capitalism. It demonstrated a very clear flaw and was met with reform and punishment. This company developed by John D. Rockefeller, used many tactics and strategies to systematically eliminate the competition in the new emerging economy of oil. Following this capitalism on a national level was seen as a system of “haves” and “have nots”. Furthermore, it exposed the selfishness and greed of the upper class. This all caused America to completely reinvent it’s economic policy to avoid private corperations from controlling the country and it’s great people.
John D. Rockefeller began his work in the oil industry
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Rockefeller would buy up anything and everything needed to make and distribute oil. He would do things such as purchase all of the barrels in the area so that other companies couldn't pack their oil and dispense it. He would also go as far as to threaten the workers so that they wouldn't go to work. With the oil companies close to bankrupt Rockefeller would buy them at a fraction of the price as he would’ve before. These tactics were cruel and unfair to the smaller companies and their business owners because there was no way for the companies to respond. The companies either didn’t have the money to hold out or, it was simply impossible for them to sell any of their product. Shortly thereafter, John soon began to make backdoor deals with the South Improvement Company, a railroad company that offered him cheap rates in turn for all of Standard Oil’s shipping remain with the South Improvement Company. This company would ship his oil all across the country at a fraction of the cost that others would have to pay for it. Shipping was so expensive many companies couldn't keep up with Rockefeller’s mass amounts of oil shipped and soon they were left in the wake of Standard Oil. Rockefeller exploited mass production by allowing him to refine and distribute oil at a much cheaper cost than its …show more content…
This ruling was seen nationwide in everything from local newspapers, and even national papers. The United States Supreme court also took a great interest in this case. Rockefeller had violated state laws in Ohio but the laws had not yet been established in New Jersey. However, federal law as dictated in the Sherman Antitrust act said that limiting competition through price fixing was illegal. As previously stated Standard Oil’s prices had been fixed at different rates across the country but it had never been noticed until the government investigated the company. Although the Federal Government hadn’t found enough evidence to get a convictions, Ida Turnbal published the book “History of the Standard Oil Company” outlining their unfair business. She went into the barrel shortages and alluded to the deals Rockefeller had made with the railroad companies. The book delved into in many aspects of social morality including legally and under Christian morals. Her book became wildly popular throughout the country sparking public outrage from many. The new public opinion on the company forced politicians to act. Theodore Roosevelt had led a push to stop corporations like Standard Oil from monopolizing their markets. He also targeted many of Rockefeller’s subsidiary companies such as Standard Grain, but also after other mega-corporations like Carnegie Steel.
Rockefeller was America’s first billionaire, and he was the true epitome of capitalism. Rockefeller was your typical rags-to-riches businessman, and at the turn of the twentieth century, while everyone else in the working class was earning ten dollars max every week, Rockefeller was earning millions. There has been much discussion as to whether Rockefeller’s success was due to being a “robber baron”, or as a “captain of industry”. By definition, a robber baron was an industrialist who exploited others in order to achieve personal wealth, however, Rockefeller’s effect on the economy and the lives of American citizens has been one of much impact, and deserves recognition. He introduced un-seen techniques that greatly modified the oil industry. During the mid-nineteenth century, there was a high demand for kerosene. In the refining process from transforming crude oil to kerosene, many wastes were produced. While others deemed the waste useless, Rockefeller turned it into income by selling them. He turned those wastes into objects that would be useful elsewhere, and in return, he amassed a large amount of wealth. He sold so much “waste” that railroad companies were desperate to be a part of his company. However, Rockefeller demanded rebates, or discounted rates, from the railroad companies, when they asked to be involved with his business. By doing so, Rockefeller was able to lower the price of oil to his customers, and pay low wages to his workers. Using these methods,
Rockefeller even wrote in a letter to a partner, "we must remember we are refining oil for the poor man and he must have it cheap and good" (83).
Fifth Edition Vol 2, New York: Longman, 1999. Hidey, Ralph W. and Muriel E. "History of Standard Oil Company (New Jersey), Vol. 1" Pioneering in Big Business" " Taking Sides Clashing Views on Controversial Issues in American History" eds.
Tarbell had always accused the leader of the Standard Oil Company, John D. Rockefeller, of putting her father and many other small oil companies out of business by the use of his ruthless tactics. ...
Rockefeller was a Robber Baron for the simple reason that he was greedy and selfish. He has treated his workers horribly and did use his money for others. He used aggressive tactics to get to where he was.
Carnegie bought his own iron and coal mines (which were necessities in producing steel) because purchasing these materials from independent companies cost too much and was insufficient for Carnegie’s empire. This hurt his competitors because they still had to pay for raw materials at much higher prices. Unlike Carnegie, John D. Rockefeller integrated his oil business from top to bottom. Rockefeller’s system was considered a ‘horizontal’ integration. This meant that he followed one product through all phases of the production process, i.e. Rockefeller had control over the oil from the moment it was drilled to the moment it was sold to the consumer.
...nd eventually morph it into what it has become modernly. The industry is transformed over time into a cut-throat game of international relations. The United States specifically becomes overwhelmed with the amount of public relations that are involved. In many cases, the country has much more pull in the affairs than that of the United States’ interests. As a result, President Eisenhower imposes mandatory quotas which protect domestic oil and stabilize the price of U.S. oil.
Rockefeller was the founder of the Standard Oil Company who utilized horizontal integration to dominate the oil industry; Rockefeller was another capitalist considered to be a “robber baron” of industrial America between the time period of 1865 and 1909 who acquired a great amount of wealth. This money was acquired with the usage of cutthroat tactics that disadvantaged his competitors immensely; Rockefeller did anything to increase his own wealth. He ran competitors out of business, lowered his prices drastically in places where competition was rough, and even threatened companies into bankruptcy, such as Ida Tarbell’s father’s business. Rockefeller believed that industrial combinations were a necessity and firmly believed in them being of benefit to the public (Doc. 6). James B. Weaver, a Populist presidential candidate, however, {disproves} this alleged belief that trusts were for the benefit of the public {theory} in his book A Call to Action by stating that trusts are the product of “threats, intimidation, bribery, fraud, wreck, and pillage” (Doc. 3). He further discredits trusts by providing an example of how the Oat Meal Trust in 1887 proved to be extremely unfortunate for and to the disadvantage of the laborers at the mills who lost their jobs (Doc. 3). This shows that the trusts that Rockefeller thrived on and made Rockefeller wealthier, though advantageous for consumers and Rockefeller himself, could often be to the disadvantage of the laborers. Rockefeller
John D. Rockefeller and other members of his family produced the fuel that powered America and Europe. In fact, 85% of the world's kerosene supply was produced in a company of Rockefeller's in Pennsylvania. J.P. Morgan, a giant in finance was equally successful by capitalizing small businesses and taking private corporations public. His genius for investing and financing was known world-wide. Because of Morgan and investors like him the American economy grew at a rate that the world had not seen before. His "Gentlemen's Agreement" brought stability to a railroad industry that was unstable because of it's incredible growth. The agreement regulated rates, settled disputes and imposed fines for companies that did not abide by the terms of their contracts. J.P. Morgan helped create a centralized banking system and paved the way for what was to become The Federal Reserve. Henry Ford a corporate giant in transportation built the Ford Motor Company and
...mpanies, it eventually came to the point where they couldn’t keep up and eventually became a part of Standard Oil. By the time Rockefeller had reached the age of 40, his company had controlled all national oil refining by 90% and about 70% of international export of said oil.
Industrial development of the late 18th century (around 1865-1900) is often characterized by it’s affluent, aggressive and monopolistic industrial leaders of the likes of men such as Andrew Carnegie, William H. Vanderbilt, and John D. Rockefeller. Due to their ruthless strategies, utilization of trusts, and exploitation of cheap labor in order to garner nearly unbreakable monopolies and massive sums of wealth, these men are often labelled as “robber barons”. At the same time, they are also often referred to as “industrial statements” for their organization, and catalyst of, industrial development; not to forget their generous contributions to the betterment of American society. Therefore, whether or not their aforementioned advances in industry were undertaken for their own personal benefits, one cannot ignore their positive effects on America. Thus, one can conclude that not only were the captains of industry both “robber barons” and “industrial statements”, but that that these two labels, in fact, go hand-in-hand.
When the topic of American economics arises, the infamous Robber Barons of the 19th Century often springs to mind. They are often glorified as "Captains of Industry" for their money making strategies and enterprising methods. Those who hold this view probably do not know the evils of the laissez-faire capitalism in which the Robber Barons believed and participated. They wanted an unrestricted system of economics so that they could amass as much money as they could to out do each other and control the power in society. They were not as glorious and generous as some people make them out to have been.
Roberts, Michael D. "Rockefeller and His Oil Empire." Northeast Ohio's Business Enthusiasts. Town Hall of Cleveland, July 2012. Web. 1 Feb. 2014. .
middle of paper ... ... On Rockefeller’s march to the top of the oil industry, he stomped upon the lives of many hard working American’s. The smaller oil operations had no chance of competing with Standard Oil due to all the tactics they employed to keep their prices low. This ravished small town families and had a similar effect as to what Wal-Mart does to family run shops nowadays.
Near the end of the nineteenth century, business began to centralize, leading to the rise of monopolies and trusts. Falling prices, along with the need for better efficiency in industry, led to the rise of companies, the Carnegie Steel and Standard Oil company being a significant one. The rise of these monopolies and trusts concerned many farmers, for they felt that the disappearance of competition would lead to abnormaly unreasonable price raises that would hurt consumers and ultimately themselves. James B. Weaver, the Populist party's presidential candidate in the 1892 election, summed up the feelings of the many American Farmers of the period in his work, A Call to Action: An Interpretation of the Great Uprising [Document F]. His interpretations of the feelings of farmers during that time were head on, but the truth is that the facts refute many of Weaver's charges against the monopolies. While it is true that many used questionable methods to achieve their monopoly, there were also other businessmen out there that were not aiming to crush out the competition. In fact, John D. Rockefeller, head of Standard Oil and a very influential and powerful man of that time, competed ardently to not crush out his competitors but to persuade then to join Standard Oil and share the business so all could profit.