John D.

Rockefeller
1839-1937

John Davison Rockefeller was born the second of six children to a working class
family in Richford, New York, a small community between Ithaca and Binghamton.
In 1853, his family moved to a farm in Strongsville, Ohio, near Cleveland. He
pursued a public education, but left high school to take business training. In 1855,
Rockefeller found his first job, working as an assistant bookkeeper for less than four
dollars a week. He showed a talent for detail and a strong work ethic from the
beginning. In 1859, Rockefeller's diligence was rewarded by being made a partner.

In that same year, oil was discovered in not-too-distant Titusville, Pennsylvania,

touching off the growth of a new industry driven largely by the demand for kerosene
for lighting. Rockefeller was immediately attracted to the oil business, but was
repelled by the disorder of the wildcatters. He finally made his bid in 1863 by
creating a refining business with Maurice B. Clark and other partners. Cleveland,
with its Great Lakes access, rail service and supply of immigrant labor, emerged early
as a refining center. In 1870, Rockefeller teamed with his brother William, Henry M.
Flagler and Samuel Andrews (inventor of an inexpensive means of refining crude oil)
to establish the Standard Oil Company.

Standard Oil and its subsidiaries quickly managed to consolidate the refining business
in the Cleveland area and then began to extend their control into Pittsburgh,
Philadelphia and New York City. Beginning in the 1870s, Standard Oil employed a
number of cutthroat business practices, including:

Monopolization—Rockefeller is remembered for buying up all of the components

needed for the manufacture of oil barrels in order to prohibit his competitors from
getting their product on the market

Rate Wars—the giant Standard Oil was able to withstand short term losses by cutting
the price of oil; smaller competitors could not keep pace and either went out of
business or sold out to Rockefeller

Rebates—Rockefeller was able to demand a refund on public rates offered by the

railroads; the carriers agreed to this practice because of Standard's immense volume

Intimidation—on more than one occasion Standard dispatched thugs to break up

competitors' operations that could not otherwise be controlled

Standard Oil originally followed the path of horizontal integration, but later in its
history it turned toward vertical integration.

In 1882, the Standard Oil Trust was formed, first of the great corporate trusts.
However, 10 years later an Ohio Supreme Court decision forced dissolution, resulting
in the creation of 20 smaller businesses. The largest segment was reorganized in 1899
as a holding company under the name of the Standard Oil Company of New Jersey,
but was dissolved following a U.S. Supreme Court decision in 1911. Rockefeller
retired at this point.

Rockefeller had followed other business interests besides oil, especially toward the
end of his tenure. He dabbled in banks, railroads, timber, iron fields and was a
director of U.S. Steel. He accumulated assets in the range of $1 billion.

To many observers, Rockefeller appeared to be a man of glaring contradictions. He

eagerly crushed his competitors, ruining hundreds in his pursuit of profit. Yet he was
a deeply religious man; he became a Baptist, was active in church affairs for many
years and was a generous financial supporter throughout. Rockefeller reduced his
workload at Standard Oil in the 1890s to direct some of his energies toward
philanthropy; after his retirement, he devoted his remaining 26 years to that endeavor.
Major Rockefeller charitable ventures included:

Rockefeller Institute for Medical Research. In 1901, Rockefeller created an

organization to study the cause and prevention of disease. The Institute later became
Rockefeller University.

General Education Board. Created in 1902, the GEB supported a wide variety of
educational improvements, concentrating attention on medical schools and the
improvement of public education in the South. Before it was phased out in 1965, the
GEB distributed more than $300 million.

Rockefeller Sanitary Commission. Established in 1909 to address the problem of

hookworm disease, the Commission mounted massive educational campaigns in the
South. Later, efforts were launched overseas before the organization was closed in
1915.

The Rockefeller Foundation. Given the broad charge "to promote the well-being of
mankind throughout the world," the Foundation provided funding for public health,
medical schools, famine prevention, the social sciences, the arts and many other
endeavors. Begun in 1913, the Foundation continued and expanded the activities of
the Sanitary Commission, and remains one of the world's leading philanthropic forces
today.

University of Chicago. Rockefeller instituted the challenge grant approach to

establish what was initially a Baptist institution of higher learning. He offered to
make a large donation if a similar amount could be raised from other sources within a
certain time frame; he favored this approach because it demonstrated a base of
support for a project and he would turn to this form of philanthropy many times over
the years. Rockefeller was also a generous benefactor of Columbia, Harvard,
Spelman, Bryn Mawr and Yale.
 John Davidson Rockefeller

John Davidson Rockefeller was born in Richford, New York in 1839. He attended the
Cleveland Central High School and at 16 he became a clerk in a commission house.
Determined to work for himself, Rockefeller saved all the money he could and in 1850 went
into business with a young Englishman, Maurice Clark. The company, Clark & Rockefeller
Produce and Commission, sold farm implements, fertilizers and household goods.

Rockefeller's company was fairly successful but did not bring him the wealth he desired. In
1862 Rockefeller heard that Samuel Andrews had developed a better and cheaper way of
refining crude petroleum. Rockefeller sold his original business and invested it in a new
company he set up with Andrews called Standard Oil.

One of the business problems that Rockefeller encountered was the high cost of transporting
his oil to his Cleveland refineries (40 cents a barrel) and the refined oil to New York ($2 a
barrel). Rockefeller negotiated an exclusive deal with the railway company where he
guaranteed sixty car-loads a day. In return the transport prices were reduced to 35 cents and
$1.30. The cost of his oil was reduced and his sales increased dramatically.

Within a year four of his thirty competitors were out of business. Eventually Standard Oil
monopolized oil refining in Cleveland. Rockefeller now bought out Samuel Andrews for a
million dollars and turned his attentions to controlling the oil industry throughout the United
States. His competitors were given the choice of being swallowed up by Standard Oil or
being crushed. By 1890 Rockefeller's had swollen into an immense monopoly which could
fix its own prices and terms of business because it had no competitors. In 1896 Rockefeller
was worth about $200 million.

In November 1902, Ira Tarbell, one of the leading muckraking journalists in the United
States, began a series of articles in McClure's Magazine on how Rockefeller had achieved a
monopoly in refining, transporting and marketing oil. This material was eventually published
as a book, History of the Standard Oil Company (1904). Rockefeller responded to these
attacks by describing Tarbell as "Miss Tarbarrel".

President Theodore Roosevelt, who had been elected on a program that included reducing the
power of large corporations, attempted to use the Sherman Anti-Trust Act to deal with
Rockefeller's monopoly of the oil industry. This was largely ineffective and it was not until
1911 that the Supreme Court dissolved the Standard Oil monopoly.

The various press campaigns against Rockefeller had turned him into one of America's most
hated men. A devout Baptist, Rockefeller began giving his money away. He set up the
Rockefeller Foundation to "promote the well-being of mankind". Over the next few years
Rockefeller gave over $500 million in aid of medical research, universities and Baptist
churches. He was also a major supplier of funds to organizations such as the Anti-Saloon
League that was involved in the campaign for prohibition. By the time that he died died on
23rd My, 1937, John Davidson Rockefeller had become a popular national figure.
 JOHN D. ROCKEFELLER

(1839-1937), industrialist and philanthropist. Rockefeller was the primary force behind the
establishment of the Standard Oil Company and thus of the American petroleum industry.

Rockefeller was born in Richford, New York, and moved with his family to Cleveland, Ohio,
where he finished high school in 1855. He began his business career as a bookkeeper-clerk in
a commission house the same year. The first successful drilling for oil took place in western
Pennsylvania in 1859, and Rockefeller realized that Cleveland was ideally suited to exploit
this new resource. He built his first refinery in 1863 in partnership with others.

The early oil business was chaotic and hazardous, with barrel prices rising as high as $13.75
and falling as low as ten cents during the 1860s, but Rockefeller, a born executive, kept his
firm consistently profitable and growing. In 1870 he, Henry Flagler, and others formed the
Standard Oil Company, with Rockefeller owning 26.7 percent of the stock. Using such then-
legal tactics as railroad rebates and predatory pricing, Standard Oil steadily increased its hold
over the American oil industry until by 1880 it controlled fully 90 percent of it.

The corporate structure of this expanding enterprise had become unwieldy, and state
corporation laws made it difficult to rationalize what had become a nationwide company. In
1882, Standard Oil's legal counsel devised the trust form of organization. Standard Oil thus
became both the first and the largest of the "trusts," one of the great bogeymen of American
politics ever since.

As such, it necessarily became a major target of reformers. Although he played the game
hard, Rockefeller never operated outside the law or sought an absolute monopoly. Rather, he
wanted Standard Oil to be large enough to enforce "order" in the oil business and prevent a
return to the chaos that had marked the industry's early years. And despite Standard's near
monopoly position, the price of oil and oil products fell drastically between 1870 and 1900.
In 1883, Rockefeller moved the company's headquarters to New York.

Always active in the Baptist church, Rockefeller early began the practice of making
substantial charitable contributions. As his resources grew, so did his philanthropy. He had
largely retired from Standard Oil by 1897 and devoted much of his energy to looking for
creative ways to give his money away. He was often guided by Baptist ministers and others,
and he established an organization to investigate carefully before giving. Once he had made
up his mind, however, he gave with wholly unprecedented generosity. In 1889 he gave
$600,000 to establish the University of Chicago (the family would ultimately give it more
than $80 million), and in the final decades of his long life he gave away an estimated $550
million to worthy causes. He also established the Rockefeller Institute, the General Education
Board, the Rockefeller Foundation, and the Laura Spelman Rockefeller Memorial
Foundation.

Peter Collier and David Horowitz, The Rockefellers: An American Dynasty (1977); Allan
Nevins, Study in Power (1953).