During the late 1800’s and early 1900’s the oil industry was a monopoly that was created by one man. Some people would describe this man as a ruthless, cruel, cutthroat business tycoon. This man was John Davison Rockefeller. John D. Rockefeller made the Standard Oil Company, becoming America’s first billionaire, and then gave away more than half his fortune to charities. John Rockefeller was a dedicated businessman who built himself an empire from nothing and helped others with his generous donations.
His business ended up helping smaller businesses because of the new laws and restrictions that needed to be created in order for the U.S. government to have a handle on the Standard Oil Company. John D. Rockefeller changed the oil industry, created and greatly contributed to many charities in America.
Rockefeller was born on July 8, 1839 in Richford, New York (J.D.R. J.D.R. Page n.p.). He married Laura C. Spelman (1839-1915) on September 8, 1864 (Rockefeller Family and Associates n.
p.). His mother, Eliza Davison Rockefeller, was very religious and disciplined, she was the person who taught him to work hard, save and give to charities (J.D.R. J.D.R. Page n.p.). Rockefeller’s mother had the biggest influence on him involving his religion and philanthropy. John D. Rockefellers father, William Avery Rockefeller, was a “pitch man” or a doctor that says he can cure cancers for a fee (J.D.R. J.D.R. Page n.p.). John and Laura Rockefeller had four girls and one boy (Rockefeller Family and Associates n.p.). The one boy they did have, John Davison Rockefeller Jr. (1874-1960), went on to continue his father’s work and make the Rockefeller name a well-liked one instead of one that was a bitter reminder of his father’s business techniques (Rockefeller Family and Associates n.p.). John D. Rockefeller died on May 23, 1937 in Ormond, Florida after retiring from the oil industry in 1911 (J.D.R. Encyclopedia of World Biography Vol. 13 228).
Rockefeller attended Folsom’s Commercial College for ten weeks where he studied single and double entry bookkeeping, penmanship, commercial history, mercantile customs, banking and exchange to help him get a job (J.D.R. J.D.R. Page n.p.). He never attended any other type of school after attending Folsom’s Commercial College.
The most important person in Rockefeller’s life was his mother when he was growing up (Bill Bell n.p.). She was the person who taught him about his religion. When Rockefeller was twelve years old, he loaned a local farmer fifty dollars at seven percent interest, and discovered that letting money do the work was a much better way to earn a living, instead of working one’s whole life (J.D.R. J.D.R. Page n.p.). Charging interest on his money earned him more than he had to loan out and led him to stocks, where he always had more of the company’s stocks than anyone else. His first real job was at as an assistant bookkeeper where he gained many responsibilities because of his hard work mentality and honesty (J.D.R. J.D.R. Page n.p.). Since Rockefeller was poor as a child he always worked hard to get anything. This was a very good quality that he had, and it helped him greatly when he was looking for a job. Rockefeller’s family was Baptist and so Rockefeller himself, was a very religious man that always gave money to the church (J.D.R. J.D.R. Page n.p.). When Rockefeller was twenty years of age, he would give ten percent of his income to his church (Roger Draper n.p.). He even paid off the mortgage of the Euclid Avenue Baptist Church after suffering a heart attack one day before he died (Bill Bell n.p.).
In his business and retired life he loved to pile up money, but also loved to give it away to charities (Bill Bell n.p.). Rockefeller first went into business, in grains, with Maurice Cark (1859) and soon expanded into oil refining when it was just getting going (J.D.R. Encyclopedia of World Biography vol. 13 226). Rockefeller was involved in the South Improvement Company Scheme in 1871, which was “…a defensive alliance of Cleveland refiners to meet the bitter opposition of the oil producers of Pennsylvania.” (J.D.R. Encyclopedia of World Biography vol.13 227). The plan and the Refiner’s pool were outlawed by the Pennsylvania Legislature (J.D.R. Encyclopedia of World Biography vol.13 227). Rockefeller’s rival, Franklin Tarbell’s daughter Ida Tarbell, wrote “History of the Standard Oil Company (1904)” which made Rockefeller look like a villain (Roger Draper n.p.). That book exposed many secrets and tactics that Rockefeller used in his business deals. After her book was released, Rockefeller’s public image went down because many of the people thought that Rockefeller was a ruthless and intimidating businessman. Rockefeller had wanted since he was a boy to earn $100,000 and he ended up being the first billionaire in America (Bill Bell n.p.).
Rockefeller was involved in the oil refinery business from 1872-1911 when he retired, and was based in Ohio and New Jersey with offices in New York (J.D.R. J.D.R. Page n.p.). In 1863 Samuel Andrews joined the firm and together Rockefeller and Andrews bought out Maurice Clark within two years when Rockefeller and Clark had been Cleveland’s largest refinery (J.D.R. Encyclopedia of World Biography vol. 13 226). Rockefeller thought that with Andrews as a partner he would be able to make more money and be able to reach more customers. Rockefeller put his brother, William, in charge of a firm in New York City as Manager of Atlantic Coast trade and export of kerosene in 1866 (J.D.R. Tycoons and Entrepreneurs 212). He wanted to have someone that he knew and that he could trust to work for him. Rockefeller knew that if he had employees that were trying to cheat him he could never be as successful as he wanted to be. In 1867 Henry Flagler was brought in as a partner (J.D.R. Tycoons and Entrepreneurs 212). Having more partners in an industry made it stronger because one person isn’t responsible for everything that happens and there is less liability on the company. Standard Oil was founded in 1870 by Rockefeller, William Rockefeller, Henry Flagler, Samuel Andrews, Stephen Harkness and O.B. Jennings, but John Rockefeller had the largest share of the company at thirty percent (J.D.R. J.D.R. Page n.p.). Rockefeller had the largest share because he was the founder of the company and he knew how stock shares could earn him more money. By now Rockefeller was one of America’s wealthiest men and he was just getting started. By 1879 he had bought out almost all other refineries and Standard Oil refined ninety percent of the oil in America (J.D.R. Encyclopedia of World Biography vol. 13 227). Rockefeller wanted to make the company successful by expanding and since Standard Oil used their own tank car fleet, ships, docking facilities, barrel-making plants, draying services, depots, warehouses and pipelines, it didn’t have to spend much money for any outside parties to make something (J.D.R. Encyclopedia of World Biography vol. 13 227). Rockefeller was a careful planner and wanted to waste as little as possible. Rockefeller changed the thinking in businesses because he was a first to own all the materials to run a large business. Soon Standard began refining crude oil, moving westward and it began foreign markets in Europe, Asia and Latin America and at this point it was almost a monopoly (J.D.R. Encyclopedia of World Biography vol. 13 227). Rockefeller was becoming so powerful and around this time many rumors about how he ran his business started to come out and he got a reputation as being a cold-hearted money lover, which was actually pretty accurate.
Andrew Carnegie was a John Rockefeller of steel, just not as ruthless. He and Rockefeller made a deal in 1896 that Rockefeller wouldn’t go near the steel industry if Carnegie wouldn’t go near the oil industry (J.D.R. Encyclopedia of World Biography vol. 13 227). This insured each other that they would each have basically no competition. They would also be able to price their products at whatever cost they wanted. When the Standard Trust was formed it was generously valued at $70,000,000 but it was really worth $200,000,000 (J.D.R. J.D.R. Page n.p.). Rockefeller was richer than he had ever imagined. Around this time he began to give money to charities. Rockefeller gave away a total of over half a billion dollars to different charities (J.D.R. Tycoons and Entrepreneurs 213).
Rockefeller’s competitors became very angered when from 1877-1878 non-Standard companies paid $1.44 per barrel of oil and Standard paid $0.80 per barrel, which drove out his competitors (J.D.R. J.D.R. Page n.p.). Rockefeller had such control over the oil industry that he got oil for a much lower price than other companies making it possible for him to be able to charge a lower price and run out his competition. Rockefeller was in the process of creating a monopoly and being the only company refining oil.
Rockefeller created the Sanitary Commission that helped raise an interest in public health, especially in the south where Hookworm Disease was a problem (Rockefeller Family and Associates n.p.). He wanted to keep the public healthy and despite what many people thought, Rockefeller did care about other people. By the time he died he had given the University of Chicago more than $80 million, as well as founding it (J.D.R. Encyclopedia Britannica n.p.). Even though Rockefeller gave away most of his fortune to charities and other causes, many people didn’t like him saying he:
“…schemed with railroads to get favorable shipping rates, secretly bought out some rivals and acquired others simply to shut them down in order to rein in the supply of oil. Whenever a competitor emerged to threaten Standard Oil, Rockefeller slashed prices specifically to cripple the financial prospects of the upstart.” (Teresa McUsic n.p.).
Most of his competitors would say these things about him in order to draw attention to what he was doing and try to get the U.S. government to take a stand in the big companies. Rockefeller’s virtual monopoly of oil refining caused state and then Congress to establish anti-monopoly laws to break up his control (J.D.R. Tycoons and Entrepreneurs 212). Rockefeller had a very big impact on his society mostly with the way big corporations are run with new laws and restrictions being enforced on them.
In 1902 Rockefeller established the General Education Board and his son John D. Rockefeller Jr. “…planned the construction of Rockefeller Center in New York City and donated the land upon which the United Nations building now stands.” (J.D.R. and J.D.R. Jr. Encyclopedia of World Biography vol. 13 226-228). Many companies still operate out the buildings in Rockefeller Center including much of NBC. Using the General Education Board Rockefeller was able to help get many schools in different parts of the country. Rockefeller and his son also created Rockefeller Institute for Medical Research in 1901, renamed Rockefeller University in New York, and he founded the University of Chicago in 1892 (J.D.R. Tycoons and Entrepreneurs 213). These universities greatly help in the study of the human body and finding cures for many illnesses or diseases. He also founded Spellman College and after Standard Oil was ordered to break up, its smaller companies eventually became Mobil Oil, Amoco, Chevron, Exxon, Chesebrough-Pond’s, Pennzoil and Union Tank Car Company (Roger Draper n.p.). Many of these companies still exist today, which shows how great Rockefeller’s empire was. Rockefeller’s contributions to America are still recognizable today. The Rockefeller Foundation was made to “promote well-being of mankind throughout the world.”, and the institutions that he founded are important establishments to philanthropy, science, medicine and public health (Rockefeller Family and Associates n.p.). Rockefeller also gave money to Yale, Harvard, Columbia, Brown, Spellman, Bryn, Mawr, Wellesly, Vassar, YMCAs, YWCAs, Palisades Interstate Park Commission; San Francisco Earthquake victims; Anti-Saloon League; Rockefeller parks in Cleveland and missionary organizations (Rockefeller Family and Associates n.p.). Everyone has used or been connected to one of the charities he donated to or one of the companies that Rockefeller’s Standard Oil split into. Rockefeller in a way shaped the American industry and set a good example of what giving is.
John D. Rockefeller greatly changed American industry .His monopoly was the beginning of a very corrupt time yet he was able to do some good with all the money that he earned and help the people by funding colleges and research institutes that discovered cures for the common people. Rockefeller became very generous with his money, becoming very involved in philanthropy in his old age and when he died he was worth $26 million and one share of Standard Oil valued at $43.94. Rockefeller is a good example of a “rags to riches” story of someone who worked hard their whole life and never gave up on what he wanted.
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