Rockefeller had partnered up with a colleague to establish a shipping company that made significant profits during the Civil War. These profits were used to start up Standard Oil, which was in the oil refinery business. Rockefeller and Standard Oil had different types of business power such as economic power, legal power, political power and power over individuals. During this time, the government did not have policies to ensure fair business practices and Standard Oil took advantage of that. Standard Oil possessed business power that it used to compel railroads to offer discounted shipping rates. The company used its economic power to change society in terms of competition. Standard Oil 's competitors could not compete on an equal platform. The discounts on shipping rates were only available to the company despite protests from the society that shipping companies were common carriers and should offer fair charges.
The social contract that existed between the company and society was initially respected. However, during the late 1800s when oil prices were unstable, Rockefeller sought to ensure that his returns were assured. He violated the social contract by competing unfairly through various ways. Companies that posed a threat to Standard Oil were bought off, and those that resisted were forced to sell through unscrupulous means (Tarbell 23). Standard Oil acquired pipelines and cut off the supply to refineries that had refused to sell. While the business world remained largely unregulated, the actions of Standard Oil were a clear violation of the social contract as fair competition practices were tacit.
This story illustrates the limits of business power by demonstrating the outcome of actions that violate those limits. S...
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...The was a contradiction between the personal and business ethics of Rockefeller given that he was an active churchgoer who also contributed to charity but did not shy away from eliminating his competition using unscrupulous means. Oil prices went down by more than 50%, and this achieved the greater good as explained in the utilitarianism theory. The assertion that nice and ethical practices would have led to the similar success for the company at that time is not viable. The market forces were significantly different during that time.
McNeese, Tim. The Robber Barons And The Sherman Anti-Trust Act. New York: Chelsea House Publishers, 2009. Print.
Schultz, Bart, and Georgios Varouxakis. Utilitarianism and Empire. Lanham, Md.: Lexington Books, 2005. Print.
Tarbell, Ida M. History of the Standard Oil Company Volume 1. [S.l.]: Theclassics Us, 2013. Print.
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