Standard Oil , its founder and his muckraker
Name: _______________________
Standard Oil Company Background
The Standard Oil Company was the largest and most powerful company in the United States between 1880 and
1910. The company refined, shipped, and marketed oil for such products as medicine, lubricants, and kerosene.
Although many Americans vilified the company for its aggressive business practices, Standard Oil created order
in the infant oil industry, defined the manufacturing and business processes needed by the industry, and prepared
the industry to produce the most important chemical for the 20th century—gasoline.
In the mid-1800s, oil became an increasingly necessary component of American life, as it was included in
medicine, lubricants, special chemicals such as naphtha, and kerosene for lighting—kerosene being the major
product. After Edwin Drake drilled the first successful oil well in Titusville, Pennsylvania in August 1859, small
oil companies sprang up throughout northwestern Pennsylvania to capitalize on the new venture.
By the 1860s, the oil industry consisted of four interrelated but independent industries—producers, refiners,
shippers, and distributors. Coordination among the many independent companies in the four industries was almost
nonexistent. Sensing a great financial opportunity if these industries could be coordinated, John D. Rockefeller
and Samuel Andrews (who owned two refineries and a company making barrels to transport oil) incorporated
their refining companies as the Standard Oil Company in June 1870.
Clash of Titans: Rockefeller vs. Tarbell
When Ida Tarbell traveled to Cleveland to observe John D. Rockefeller Sr., the man she had
been writing about for two years, she chose not to confront him face to face. For two hours,
she sat studying Rockefeller’s every move and gesture at a distance, gathering ammunition
for a scathing character piece.
For his part, Rockefeller never got back at the feisty reporter. "Let the world wag," was his
favorite motto, and silence his only response to Tarbell’s attacks.
But reading the combative opinions they voiced about everything, from monopolies to each
other, it is easy to imagine the conversation these two headstrong characters would have had.
You can read their clashing viewpoints below.
What they thought of each other
Tarbell: [Mr. Rockefeller] was no ordinary man. He had the powerful imagination to see what might be done
with the oil business if it could be centered in his hands —- the intelligence to analyze the problem into its
elements and to find the key to control. He had the essential element to all great achievement, a steadfastness to a
purpose once conceived which nothing can crush.
Mr. Rockefeller was "good." There was no more faithful Baptist in Cleveland than he. Every enterprise of that
church he had supported liberally from his youth. He gave to its poor. He visited its sick. He wept for its
suffering. Moreover, he gave unostentatiously to many outside charities of whose worthiness he was satisfied. He
was simple and frugal in his habits. He never went to the theater, never drank wine. He was a devoted husband,
and he gave much time to the training of his children, seeking to develop in them his own habits of economy and
clarity. Yet he was willing to strain every nerve to obtain for himself special and illegal privileges from the
railroads which were bound to ruin very man in the oil business not sharing them with him. Religious emotion
and sentiments of charity, propriety and self-denial seem to have taken the place in him of notions of justice and
regard for the rights of others.
It may be that Mr. Rockefeller is one of those double natures that puzzle the psychologist. A man whose soul is
built like a ship in air-tight compartments to use the familiar figure -- one devoted to business, one to religion and
charity, one to simple living and one to nobody knows what. But between these compartments there are no doors.
The life that goes on in compartment I has no relation to that of compartment II, has no influence upon it. Each is
a solitary unit. It is an uncanny explanation, but it may be the true one.
Rockefeller: This sweetness that she tries to bring in, referring to these good qualities, and
this praise that she brings in as to ability and perseverance and whatever traits which she
concedes bring success, is simply covering up her wrath and her jealousy which were all the
time present, but which she did not show all the time and which she thought she could bring
out all the better by weaving this in as silken thread.
She makes a pretence of fairness, of the judicial attitude, and beneath that pretence she slips
into her ‘history’ all sorts of evil and prejudicial stuff, calling it ‘the record of the court,’
where it is only a statement by a party at interest, and she hides the other side. She is very
adroit and cunning; but even she has defeated herself. She has over-reached herself, and
anyone who reads her book with care can see that she is dishonest, prejudiced, untruthful.
Poor woman! How she has degraded herself and failed of accomplishing her object to injure, to smirch, to
overthrow the Standard Oil Company, to satisfy the petty spite against it because forsooth her father and brother
could not compete in the oil business.
Rockefeller’s tactics during the Cleveland Massacre
Rockefeller: I do not remember just how many [refineries] there were [in Cleveland] — say twenty-five or thirty,
more or less. Some of them were very little. … More than seventy-five, and probably more than eighty per cent -certainly a great number -- of the refiners at Cleveland were already crushed by the competition which had been
steadily increasing up to this time. … They didn’t collapse. They had collapsed before. That’s the reason they
were so glad to combine their interest if they so wished it… [They were] mighty glad to get somebody to come
and find a way out. We were taking all the risks, putting up our good money. They were putting in their old junk.
… When it was found how much of stock or money would be given in exchange for their plants we found no
difficulty in proceeding rapidly with the negotiations, and nearly all came in… though it is true that a few of the
refiners decided to remain out, and these were among the smallest and least able to compete with us. With these
our relations continued, entirely pleasantly, until at length, one by one, of their own volition, they were pleased to
embrace the opportunity to join their interests with ours, the result of which in every case was most satisfactory to
them.
What I did say [to them] was: "We here [in Cleveland] are at a disadvantage. Something should be done for our
mutual protection. We think this is a good scheme. Think it over. We would be glad to consider it with you if you
are so inclined."
There was no compulsion, no pressure, no ‘crushing’. How could our company succeed if its members had been
forced to join it and were working under the dash?
Tarbell: There were at the time some twenty-six refineries in [Cleveland], some of them very large plants. All of
them were feeling more or less the discouraging effects of the last three or four years of railroad discriminations
in favor of the Standard Oil Company. To the owners [of the 26 refineries] Mr. Rockefeller went one by one, and
explained the South Improvement Company. "You see," he told them, "this scheme is bound to work. It means
absolute control by us of the oil business. There is no chance for any one outside. But we are going to give
everybody a chance to come in. You are to turn over your refinery to my appraisers, and I will give you Standard
Oil Company stock or cash, as you prefer, for the value we put upon it. I advise you to take the stock. It will be
for your good." … It was useless to resist, he told the hesitating: they would certainly be crushed if they did not
accept his offer, and he pointed out in detail, and with gentleness, how beneficent the scheme really was --
preventing the Creek refiners from destroying Cleveland, keeping up the price of refined oil, destroying
competition, and eliminating speculation.
Standard Oil vs. the independents
Tarbell: All over the country the refineries in the same condition as Mr. Tack's firm sold or leased. Those who
felt the hard times and had any hope of weathering them resisted at first. With many of them the resistance was
due simply to their love for their business and their unwillingness to share its control with outsiders. The thing
which a man has begun, cared for, led to a healthy life, from which he has begun to gather fruit, which he knows
he can make greater and richer, he loves as he does his life. It is one of the fruits of his life. He is jealous of it -wishes the honor of it, will not divide it with another. He can suffer heavily by his own mistakes, learn from them,
correct them. He can fight opposition, bear all -- so long as the work is his. There were refiners in 1875 who loved
their business in this way. Why one should love an oil refinery the outsider may not see; but to the man who had
begun with one still and had seen it grow by his own energy and intelligence to ten, who now sold 500 barrels a
day where he once sold five, the refinery was the dearest spot on earth save his home. He walked with pride
among its evil-smelling places, watched the processes with eagerness, experimented with joy and recounted
triumphantly every improvement. To ask such a man to give up his refinery was to ask him to give up the thing
which, after his family, meant most in life to him.
To Mr. Rockefeller this feeling was a weak sentiment. To place love of independent work above love of profits
was as incomprehensible to him as a refusal to accept a rebate because it was wrong!
Rockefeller: What a Godsend it was to the many little inefficient and unsuccessful refiners of Oil Creek that a
buyer was found for them when for years they had been losing money! How wrong for the "historian" to call it a
crime that these men were delivered from their sinking ships. It was a great mercy and without precedent, as has
been hitherto stated.
Almost any other historian, it would seem, would blush today to read injustice as it is written in these very pages,
where [Ms. Tarbell] is made to speak of the crime, which should have been characterized only as an
unprecedented magnanimous deliverance such as had not hitherto been known in the annals of business!
In all times past the weak man in the competition dropped out and was lost sight of. These men for years were
importuned to join hands with those who were stronger and ready to pull them out from their embarrassments and
fit them in to be useful in the administration of the Standard Oil Company so far as they had integrity,
intelligence, enterprise and industry to warrant the expectation that they could be stones in the foundation of the
great structure, the likes of which the world had never seen.
[As for the producers], they were like a lot of foolish children, and would not be controlled, and would not
observe the law referring to supply and demand. And this was all there was in the problem.
How many times we told them--over and over again! --that if they would restrict production they would be the
gainers. But how impossible it was for them to grasp that fact, and how impossible it was for them to summon
sufficient integrity to carry out they agreements they made, in order to keep it. They knew it, but they wanted
what certain of the refiners wanted; that is, to keep their bread and butter and eat it, too. This was found
impossible.
These people didn’t believe in themselves; they didn’t believe in the Standard Oil Co, they didn’t believe in
anybody, away down, and there was a screw loose in a great many of them, and so the sane ones had a hard
problem.
Rockefeller’s legacy
Rockefeller: The Standard Oil Co. has been one of the greatest, if not the greatest, of upbuilders we ever had in
this country--or in any country. All of which has inured to the benefit of the towns and cities the country over; not
only in our country but the world over. And that is a very pleasant reflection now as I look back. I knew it at the
time, though I realize it more keenly now.
We had vision, saw the vast possibilities of the oil industry, stood at the center of it, and brought our knowledge
and imagination and business experience to bear in a dozen--twenty, thirty directions. There was no branch of the
business in which we did not make money.
It will be said: "Here was a force that reorganized business, and everything else followed it--all business, even the
Government itself, which legislated against it."
Tarbell: [John Rockefeller’s] importance lies not so much in the fact that he is the richest individual in the world,
with the control of property that entails; it lies in the fact that his wealth, and the power springing from it, appeal
to the most universal and powerful passion in this country -- the passion for money. John D. Rockefeller,
measured by our national ambition, is the most successful man in the world--the man who has got the most of
what men most want. …
Mr. Rockefeller is a hypocrite. This man has for forty years lent all the power of his great ability to perpetuating
and elaborating a system of illegal and unjust discrimination by common carriers. He has done more than any
other person to fasten on this country the most serious interference with free individual development which it
suffers, an interference which, today, the whole country is struggling vainly to strike off, which it is doubtful will
be cured, so deep-seated and so subtle is it, except by revolutionary methods.
It does not pay. Our national life is on every side distinctly poorer, uglier, meaner, for the kind of influence he
exercises.
Read the section titled "What they thought of each other." After you read, answer the following questions:
According to Tarbell:
1.
2.
3.
4.
What is the essential element to great achievement?
What characteristics made Rockefeller "good"? Why was this word placed in quotation marks?
What negative personality characteristics did Rockefeller have?
Why was Rockefeller able to simultaneously lead two lives—one devoted to business and the other
devoted to religion and charity?
According to Rockefeller:
1.
2.
3.
4.
What was Tarbell's true character like?
What was her social character, or the side she showed in public, like?
Was Tarbell an ethical journalist? Why or why not?
Why did Tarbell hold a grudge against the Standard Oil Company?
Whose opinion do you think was right, or do you believe that both Tarbell and Rockefeller could be right?
Then finish the following sentences:
I think Ida Tarbell was correct in her opinion of John D. Rockefeller because
I think John D. Rockefeller was correct in his opinion of Ida Tarbell because