EPUB paragraph 31 · Text/Cher_9780307429773_epub_c14_r1.htm
In 1873, Standard secretly bought half of Chess, Carley and Company, which had a Louisville refinery and a lucrative marketing operation in the Southeast. The owner, F. D. Carley, was a lapsed Methodist minister who set a new standard for pitiless methods in oil marketing. Confidential reports informed Rockefeller that Carley was a charming scoundrel, an inveterate gambler who went straight from board meetings to his bookie’s office; even the circumspect Rockefeller referred euphemistically to Carley’s “want of balance.” Although Rockefeller planned to pack Chess, Carley’s board with a majority of Standard directors, Carley blocked outright control from 26 Broadway until 1881, and another five years elapsed before Standard swallowed the firm whole and renamed it Standard Oil of Kentucky.
Names: John D. Rockefeller, Sr. · F. D. Carley · Standard Oil · 26 Broadway · Kentucky · Louisville · Southeast · Chess, Carley
EPUB paragraph 32 · Text/Cher_9780307429773_epub_c14_r1.htm
By then, Chess, Carley had become a byword for vicious tactics. When F. D. Carley learned that Standard Oil’s nemesis George Rice had shipped a scant seventy barrels of kerosene to a Louisville merchant, he reacted furiously. As a director of the Louisville, Nashville and Great Southern Railroad, which had granted Rice low freight rates, Carley had an underling dash off a peremptory letter to the railroad’s freight agent, telling him exactly how to treat Rice: “Please turn the screw.” When this quotation was revealed by investigators years later, it was emblazoned in newspaper headlines across America.
Names: F. D. Carley · George Rice · Standard Oil · United States · Rice · Louisville · Chess, Carley · Nashville · Great Southern Railroad
EPUB paragraph 33 · Text/Cher_9780307429773_epub_c14_r1.htm
Carley went to extravagant lengths to stop competitors. When he learned that Rice planned to sell kerosene in Columbus, Mississippi, he sent local grocers an unambiguous letter: “If you do not buy our oil we will start a grocery store and sell goods at cost and put you all out of business.” No bluffer, Carley set up a store that sold Standard Oil kerosene at cut-rate prices, as well as oats, meat, sugar, coffee, and other household items at or below cost. In many localities, grocers gladly took a 5 percent discount offered on foodstuffs by Carley in exchange for an agreement to carry only Standard kerosene, one of many anticompetitive practices perfected by Standard Oil that shaped future antitrust legislation. Notwithstanding the public uproar, Rockefeller claimed to be unaware of Carley’s practices. Yet at one point, Colonel Thompson confidentially told Rockefeller that Carley was a “secret, surreptitious” man with “mysterious, dishonest secrets” who even cheated on his agreements with Standard Oil.
Names: John D. Rockefeller, Sr. · W. P. Thompson · F. D. Carley · Standard Oil · Rice · Columbus · Mississippi
EPUB paragraph 34 · Text/Cher_9780307429773_epub_c14_r1.htm
In 1878, Standard Oil boldly expanded its marketing territory by acquiring a 40 percent stake in the Waters-Pierce Company, which was based in Saint Louis and dominated a wide swatch of territory from Arkansas to Texas. It was decided that Chess, Carley would monopolize the oil trade east of the Mississippi, while Waters-Pierce would control the area southwest of the river. The Waters-Pierce deal brought another patent scoundrel into the trust, Henry Clay Pierce, who made F. D. Carley look like a cherub in comparison. By age nineteen, this country doctor’s son monopolized the kerosene trade in Saint Louis, and then he mounted a pony and branched out into Arkansas and Texas. Even Standard Oil people never defended Henry Clay Pierce. One executive recalled him as a gifted businessman but added, “He couldn’t do a thing straight if it could be done crooked. He was cordial and polite enough, and it was only when he got into a jam with people that he became nasty. Then they knew they were fighting someone. He was the greatest fighter you ever saw.”
Names: F. D. Carley · Standard Oil · Henry Clay Pierce · Saint Louis · Texas · Waters-Pierce · Mississippi · Arkansas · Waters-Pierce Company · Chess, Carley
EPUB paragraph 35 · Text/Cher_9780307429773_epub_c14_r1.htm
Once again, Rockefeller self-servingly disclaimed knowledge of the rough-house tactics used by the Waters-Pierce salesmen and portrayed Pierce as a loose cannon who operated on his own initiative. He said that he never gave “a minute in a month to this local trade” and that any marketing excesses, when exposed, were condemned by the executive committee, but his files show that he received a full accounting of Pierce’s high crimes and misdemeanors. When Pierce made a highly profitable foray into the Mexican market in 1880, Colonel Thompson reported to Rockefeller that this had been accomplished “largely by evasion of the enormous duty placed upon Refined oil by Mexico.” Enriched by this operation, Pierce declared a 100 percent dividend on capital the next year. Thompson repeatedly warned Rockefeller about Pierce, branding him “a man not without designs” and relaying a letter “showing great duplicity on the part of Mr. Pierce.” Far from rebuking Pierce, in 1892 Rockefeller extended him a personal loan for $200,000—a king’s ransom—and patiently carried him for eight years. Clearly, he had no qualms about the buccaneering spirit of the Waters-Pierce business.
Names: John D. Rockefeller, Sr. · W. P. Thompson · Waters-Pierce · Pierce · Mexico
EPUB paragraph 36 · Text/Cher_9780307429773_epub_c14_r1.htm
The Standard Oil marketing subsidiaries fanned out across the remaining sections of the continent. In 1878, the Consolidated Tank Line Company took over the territory north of the Missouri River, spread across Michigan and Minnesota, then expanded westward into the Dakotas. Formed in 1884, the Continental Oil Company covered the Rocky Mountain states. In the mid-1870s, the trust sent a young executive to California, Wesley H. Tilford, who foresaw the state’s potential as both an oil producer and consumer; a decade later, Standard Oil of Iowa developed this West Coast trade. Many frustrated customers of Waters-Pierce turned, in revenge, to Republic Oil, a New York–based company that specialized in cultivating retailers who loathed the trust. Of course, Republic was secretly owned by Standard Oil.
Names: Standard Oil · New York · Wesley H. Tilford · California · Minnesota · Michigan · Waters-Pierce · Iowa · Republic · West Coast · Republic Oil · Rocky Mountains · Consolidated Tank Line Company · Missouri River · Continental Oil Company
EPUB paragraph 37 · Text/Cher_9780307429773_epub_c14_r1.htm
Around 1886, 26 Broadway divided the continent into eleven marketing districts, with boundary disputes to be resolved by a domestic-trade committee. As subsidiaries raided each other’s territories, their clashes were arbitrated by headquarters. Nothing so clearly reveals the trust’s imperial character than its deliberations about marketing territories, where exclusive rights to entire states and countries were dispensed like so many royal charters. At one point, when Chess, Carley; Waters-Pierce; and Consolidated Tank Line tangled over the virgin southwestern territory, Colonel Thompson explained to Rockefeller, “I have, for a long time, waited for the opportunity of defining the western limits of all these connections and take the liberty of saying on behalf of Standard Oil Co. that we had never conceded to any one the right to go and occupy Colorado, New Mexico, Arizona or Mexico.” In the end, Standard Oil ceded Mexico to Henry Pierce in a swap for the state of New Mexico.
Names: John D. Rockefeller, Sr. · W. P. Thompson · Standard Oil · Colorado · 26 Broadway · Waters-Pierce · Mexico · New Mexico · Arizona · Chess, Carley · Consolidated Tank Line · Henry Pierce
EPUB paragraph 38 · Text/Cher_9780307429773_epub_c14_r1.htm
Once Rockefeller controlled a marketing territory, he protected it fiercely and quickly dispatched troops to fend off the smallest incursion. If Standard Oil spotted even one carload of outside oil entering its territory, it traced its source through railroad agents and moved swiftly to halt it. Standard Oil marketing men were known to trail competitors’ wagons and undersell them if necessary. This unceasing drive, this implacable need to win, emanated from Rockefeller himself. When told that competitors had appeared in Saint Louis, he exhorted Oliver Payne, “Regret to hear that those parties have established an agency in St. Louis. We must not let them get the business. Why not make a good, hard, vigorous fight with the view of taking it all back again and not let them retain a foothold there, and the same in St. Paul.”
Names: John D. Rockefeller, Sr. · Oliver H. Payne · Standard Oil · Saint Louis · St. Paul
EPUB paragraph 39 · Text/Cher_9780307429773_epub_c14_r1.htm
As the capstone of this system, Rockefeller fostered an extensive intelligence network, assembling thick card catalogs with monthly reports from field agents, showing every barrel of oil sold by independent marketers in their territory. From 26 Broadway, the titan could peer into the most distant corners of his realm. Standard Oil spies collected much of this information from grocers and railway-freight agents. One Cleveland refiner discovered that Standard paid his bookkeeper twenty-five dollars a month to provide information on his shipments, mailing these trade secrets to Box 164 at the Cleveland post office. Standard’s reputation as a pervasive, all-seeing presence was richly deserved.
Names: John D. Rockefeller, Sr. · Standard Oil · Cleveland · 26 Broadway
EPUB paragraph 40 · Text/Cher_9780307429773_epub_c14_r1.htm
The manic vigor of Standard’s salesmen becomes understandable in light of a secret policy that Archbold enunciated to Rockefeller in an 1891 letter. Station managers were expected to command at least 85 percent—and, if possible, much more—of the oil trade in their district, a punishing standard that goaded them into aggressive tactics. Because they had carte blanche to reduce prices and use any other means necessary to hold the trade, they created pitched battles in many cities. One repentant Standard Oil marketer named Charles Woodbury recalled a favorite scare tactic. “Substantial rumors that the few independents surviving might not much longer be able to supply oil at all continually alarmed their customers.”
Names: John D. Rockefeller, Sr. · John D. Archbold · Standard Oil · Charles Woodbury
EPUB paragraph 41 · Text/Cher_9780307429773_epub_c14_r1.htm
Rockefeller found nothing reprehensible about this intelligence network and could never understand the eternal fuss. “The practice of the Standard Oil Company in this regard brings no credit or discredit to the Standard Oil Company,” he later told William O. Inglis. “It was following out a method in universal use by the largest and most intelligent distributors of goods the country over.” Some Standard Oil people, however, refused to stoop to these methods. When Charles Woodbury protested eavesdropping on competitors, his superior gruffly insisted, “We do not intend merely to grasp the situation—we must control it.” Woodbury replied, “But this is espionage. I cannot stand over these men and make them go after these details.” After being censured for such squeamishness, he quit in protest. Recounting this in 1911, Woodbury left some tart comments about Rockefeller’s assumed innocence. “Results were what the master asked for,” he explained. “Details [Rockefeller] need not know. He could be left to his own self-effacement. He had selected his staff.” In short, Rockefeller posted the sales targets, whipped up the fervor, then foreswore any knowledge of the inevitable consequences.
Names: John D. Rockefeller, Sr. · William O. Inglis · Standard Oil · Charles Woodbury
EPUB paragraph 42 · Text/Cher_9780307429773_epub_c14_r1.htm
To square his actions with his conscience—always a necessity for Rockefeller—he needed to invoke an overarching theme: vouchsafing cheap light to humanity. Touring a well drilled on Oil Creek in the early days, he stared at it silently and then intoned, “This is the poor man’s light.” Such remarks weren’t just for public consumption but were commonplaces in his correspondence. In 1885, he instructed a young colleague, Henry C. Folger, “Let the good work go on. We must ever remember we are refining oil for the poor man and he must have it cheap and good.” Having grown up in secluded farmhouses, reading by candlelight, he understood the revolutionary impact of cheap kerosene.
Names: John D. Rockefeller, Sr. · Henry Clay Folger · Oil Creek
EPUB paragraph 43 · Text/Cher_9780307429773_epub_c14_r1.htm
Rockefeller never had a single motive for any action and was surely motivated by more than altruism in championing cheap kerosene. He was obsessed with high-volume, low-cost production to maintain market share, even if he temporarily sacrificed profit margins. As he noted, “This fact the Standard Oil Company always kept in mind: that they must render the best service and be content with a largely increasing volume of business, rather than increase the profit so as to tempt others to compete with them.” When discussing prices with subordinates, he frequently reminded them, “We want to continue, in reason, that policy which will give us the largest percentage of the business.”
Names: John D. Rockefeller, Sr. · Standard Oil
EPUB paragraph 44 · Text/Cher_9780307429773_epub_c14_r1.htm
The public tolerated the trust’s brawny tactics for a long time because it believed that it had, over the long run, cheapened kerosene and exercised a relatively benevolent dictatorship. As journalist Henry Demarest Lloyd wrote scornfully to George Rice in 1891, “Thus the public—dear fools—believe, and it entirely reconciles them—knavish fools—to the piracies, treasons and murders by which the fabled cheapness has been brought to them.” Befuddled reformers assailed the trust for selling both too high and too low, for fleecing consumers and underselling rivals. As John Archbold summed up the paradox, “It is usually alleged that whenever the Standard, for whatever reason, advances its prices, it is oppressing the consumer, and when if, on the other hand, it lowers its prices, it is then oppressing its competitors.” Of course, both things were often true, since Standard Oil kept prices high where it faced no competition and low where it had to keep rivals at bay. On balance, the trust wielded its monopolistic power to keep prices artificially low to forestall competition.
Names: John D. Archbold · Henry Demarest Lloyd · George Rice · Standard Oil
EPUB paragraph 45 · Text/Cher_9780307429773_epub_c14_r1.htm
In general, Standard Oil did an excellent job at providing kerosene at affordable prices. It boasted far lower unit costs than competitors and relentlessly drove down costs over the years. Between 1880 and 1885, its average cost of processing a gallon of crude oil went from 2.5 to 1.5 cents. In a rare 1890 newspaper interview, a supremely confident Rockefeller said that since Standard’s birth twenty years before, the retail price of kerosene had plunged from 23.5 to 7.5 cents per gallon. Only half that drop, he contended, had resulted from the steep fall in crude-oil prices, and he credited the tank-wagon system for much of the savings. In the early 1900s, the Bureau of Corporations attributed most of the drop in kerosene prices to a sharp dip in crude-oil prices, not to Standard’s superefficient management. Whatever the truth, the resulting low prices inoculated the public for a long time against the anti-Standard venom.
Names: John D. Rockefeller, Sr. · Standard Oil · Bureau of Corporations
EPUB paragraph 46 · Text/Cher_9780307429773_epub_c14_r1.htm
Many of Rockefeller’s foes contended that routine underselling was his most lethal weapon, even more destructive than railroad rebates. As the industry’s low-cost producer, Standard merely had to dump oil at cost to stamp out competitors. The practice of selling at or below cost, which started in the 1870s, intensified with the tank-wagon system, which permitted the trust to set retail prices. Hesitant to initiate price wars, which smacked of the old, Darwinian competition, Rockefeller said that he cut prices only defensively—that is, when forced to retaliate against price-cutting independents. When he did so, he showed no mercy against these reprobates and said with righteous indignation, “These people did not want cooperation. They wanted competition. And when they got it they didn’t like it.”
Names: John D. Rockefeller, Sr. · Standard Oil
EPUB paragraph 47 · Text/Cher_9780307429773_epub_c14_r1.htm
Allan Nevins cited a federal study of predatory pricing that found that Standard Oil practiced it in only 37 of 37,000 towns serviced by its tank wagons and then only in response to cuts by competitors. Yet Rockefeller’s files are so rife with references to this practice as to refute Nevins’s verdict. In an 1886 letter, Colonel Thompson told Rockefeller that Standard sold at cost wherever competition appeared and compensated for the lost profits by raising prices in less competitive locales: “We find the outsiders mainly from Pittsburgh and the Oil Region had 2,000 barrels of oil in Cincinnati.… We have lowered the Cincinnati market an additional half cent temporarily to meet that competition and forced them to sell their oil without a profit.” In contrast, he noted that with independents now banished from Chicago, “we jacked that price up a quarter or so, without multiplying instances, we are doing all around. The system is working well, better than any other we can devise and our feeling is to hold along on this basis—I beg you and the other gentlemen will keep in mind the fact that we are selling ¼ of all the oil we handle without a farthing of profit to this department.”
Names: John D. Rockefeller, Sr. · W. P. Thompson · Allan Nevins · Standard Oil · Oil Regions · Pittsburgh · Chicago · Cincinnati
EPUB paragraph 48 · Text/Cher_9780307429773_epub_c14_r1.htm
If Standard Oil sold one-quarter of all its oil at cost, as Thompson alleged, that would have meant anticompetitive price cuts in more than 9,000 towns—quite different from the 37 cited by Nevins. The trust used such infinite sleight of hand in setting prices, obscuring the real price through secret discounts, that a definitive accounting is impossible. Though many states had already outlawed predatory pricing, they found such a ban difficult to enforce. On this issue, Rockefeller remained an unreconstructed monopolist, defending Standard Oil’s price-cutting years later by commenting, “If in doing so they were losing money, which they made up on some of the specialties—they made up the difference—would it be a crime?” Eventually, a national ban on such predatory pricing formed an integral component of antitrust legislation.
Names: John D. Rockefeller, Sr. · W. P. Thompson · Allan Nevins · Standard Oil
EPUB paragraph 49 · Text/Cher_9780307429773_epub_c14_r1.htm
Standard’s policy of differential pricing also proved expedient in the global marketplace. During the 1880s and 1890s, trying to stem the tide of Russian and East Indian oil, the organization charged lower prices in Europe and compensated with higher American prices. Its tight control of the home market enabled it to prosecute savage price wars against the Nobels, Rothschilds, Royal Dutch, and Shell. For this reason, Standard Oil always considered its domestic monopoly a necessary precondition for its overseas conquests.
Names: Standard Oil · Rothschild family · Europe · Royal Dutch · Nobels · Shell · East
EPUB paragraph 50 · Text/Cher_9780307429773_epub_c14_r1.htm
But Standard Oil never sought a perfect monopoly because Rockefeller realized that it was politically prudent to allow some feeble competition. As he admitted, “We realized that public sentiment would be against us if we actually refined all the oil.” The combine ceded about 10 percent of the refining and marketing business to a tiny group of fringe rivals. Even in the mid-1880s, ninety-three mostly marginal refineries were allowed to operate. A very smart monopolist, Rockefeller kept prices low enough to retain control of the market but not so low as to wipe out all lingering competitors.
Names: John D. Rockefeller, Sr. · Standard Oil
EPUB paragraph 51 · Text/Cher_9780307429773_epub_c14_r1.htm
We must retire one common canard about Rockefeller: He didn’t set crude-oil prices through blanket edicts. In his correspondence, one sees the oil king trying to guess the trend of crude prices and bemoaning speculation. As he told one of his personal financial advisers in 1882, crude oil “is about the worst commodity in the world to speculate in.… It is about as uncertain as railroad stocks.” Perhaps the chief way that Standard Oil influenced crude prices was by elevating or dropping storage charges at its pipelines, which the firm sometimes used to break speculative raids. By issuing certificates against oil stored by its pipelines, it stimulated a free market in crude oil, and hundreds of thousands of people speculated in or borrowed against these certificates, creating the first oil-futures market and setting the trend for spot prices. After the National Petroleum Exchange opened in Manhattan in late 1882, the speculators far outweighed the trust in importance in pegging prices.
Names: John D. Rockefeller, Sr. · Standard Oil · Manhattan · National Petroleum Exchange
EPUB paragraph 52 · Text/Cher_9780307429773_epub_c14_r1.htm
As Rockefeller boasted, Standard Oil was an infallible moneymaker. In the late 1880s, Henry M. Flagler testified it had average earnings of 13 percent a year on net assets, which considerably understated its performance. When Teddy Roosevelt’s Bureau of Corporations later examined the matter, it computed a more handsome 19 percent return from 1882 to 1896. Rockefeller defended these high returns as justified by the fear that the oil might run dry and render the trust’s vast investment worthless. He knew public opinion was inflamed by the exorbitant dividends declared on Standard Oil shares, which sometimes ran as high as 200 percent. These figures were misleading, Rockefeller argued, since Standard Oil’s actual capital was typically ten times its official capitalization. In terms of real capital, the 200 percent dividend declared in January 1885 was more like 20 percent—extremely high but not astronomical. Such a rich but not altogether outrageous return was just what the politic Rockefeller wanted.
Names: John D. Rockefeller, Sr. · Henry M. Flagler · Theodore Roosevelt · Standard Oil · Bureau of Corporations
EPUB paragraph 53 · Text/Cher_9780307429773_epub_c14_r1.htm
Rockefeller knew that if he got greedy, other products could be substituted for kerosene, and this, too, curbed his appetite for excess profits. Oil was just one of many fossil fuels and kerosene one of many potential illuminants. In the fall of 1878, America’s wunderkind, Thomas Alva Edison, boasted to reporters at Menlo Park, New Jersey, that he had dreamed up a practical electric lightbulb; within a year, he had created a miraculous bulb that glowed brightly for one hundred straight hours and directly threatened Rockefeller’s kerosene business. The new Edison Electric Light Company enlisted affluent bankers, including the august Drexel, Morgan and Company. On September 4, 1882, Edison stood in J. P. Morgan’s offices at 23 Wall Street and threw a switch that brightened Morgan’s office with electric lighting, inaugurating a generating plant in lower Manhattan. Luckily for Rockefeller, the lightbulb didn’t instantly drive out kerosene: It took time for Edison to cover the country with power stations, and by 1885 only 250,000 lightbulbs shone across America.
Names: John D. Rockefeller, Sr. · J. P. Morgan · United States · Manhattan · Thomas Alva Edison · New Jersey · Drexel · Morgan and Company · Menlo Park · Edison Electric Light Company · Wall Street
EPUB paragraph 54 · Text/Cher_9780307429773_epub_c14_r1.htm
Instead of electric light, the soft, shimmering glow of gaslight began illuminating many American cities in the 1880s. For a long time, natural gas had been discarded by oilmen as a waste product until a business group led by J. N. Pew piped natural gas to Pittsburgh in 1883. Quick to perceive that natural gas complemented the oil business, Rockefeller advised Daniel O’Day that Standard Oil should develop its own strength in this area rather than turning to outsiders. O’Day and his ebullient team assured Rockefeller that they could pipe explosive gas long distances without mishaps. Within two years, they were piping gas from western Pennsylvania to cities in Ohio and New York, and by the late 1890s Rockefeller secretly oversaw natural-gas companies in Titusville, Oil City, Buffalo, and thirteen other localities. As one newspaper said, “Consumers in some of these places would be surprised to learn that they are burning Standard Oil gas.”
Names: John D. Rockefeller, Sr. · Daniel O’Day · Standard Oil · New York · Titusville · Oil City · Pittsburgh · Buffalo · J. N. Pew · Ohio · Pennsylvania
EPUB paragraph 55 · Text/Cher_9780307429773_epub_c14_r1.htm
To counter competition from gaslight, Edison based his promotional scheme upon a moral and aesthetic contrast between good electric light and evil gaslight. Of the flickering gaslight that later generations found so enchantingly poetic, he sneered, “It is a nasty, yellow light, too, and far removed from the color of the lovely natural light,” while he touted the “soft radiance” of electric lights as “singularly powerful and even … perfectly steady.” With a persistence worthy of Standard Oil’s crusaders, Edison sales agents approached customers using “outmoded” gas jets and urged them to switch to advanced electric lamps.
Names: Standard Oil · Thomas Alva Edison
EPUB paragraph 56 · Text/Cher_9780307429773_epub_c14_r1.htm
The promotion of natural gas involved Rockefeller in sanguinary battles, for the major customers were municipalities, and the decisions were always highly political. The natural-gas business fed rampant corruption, a veritable cornucopia of graft, as companies manipulated urban officials to get these franchises. Though Rockefeller regularly denied knowledge of such machinations, his papers tell a different story: He exercised a supervisory role and knew all about the money funneled to politicians. In securing the Detroit franchise, Standard Oil furnished an emissary, G. A. Shelby, with $15,000 in cash and $10,000 in gas stock to sway politicians. When payment came tardily, Shelby groused to Rockefeller: “Will you guarantee the amount stated if Ordinance passes and is approved by the Mayor.… I have been to considerable expense and want to be sure of prompt settlement when work is completed.”
Names: John D. Rockefeller, Sr. · Standard Oil · Detroit · G. A. Shelby
EPUB paragraph 57 · Text/Cher_9780307429773_epub_c14_r1.htm
In the natural-gas battles, the porous boundaries between politics and business began to crumble and disappear. In 1886, Daniel O’Day met behind closed doors in Philadelphia with the rival Columbia Natural Gas Company and fairly gasped at the political luminaries who were represented. As he told Rockefeller, “I was astonished to learn the people who are in it. All of the Republican local politicians of Philadelphia are stockholders. They are very much afraid of their investment, and feel now that unless they make some alliance with us that they will in all probability lose all their money, or a great share of it.” From pure expediency, O’Day favored a deal with their rivals, telling Rockefeller, “The feeling generally was to push the co. to the wall, a feeling in which I would fully share, were it not for the fact that the stockholders of the company might be very bad enemies to have in the Penna. legislature next winter.” Unconvinced by such pragmatic reasoning, the executive committee overruled Day.
Names: John D. Rockefeller, Sr. · Daniel O’Day · Philadelphia · Columbia Natural Gas Company · Penna
EPUB paragraph 58 · Text/Cher_9780307429773_epub_c14_r1.htm
The most bitter natural-gas fracas erupted in Toledo, Ohio, where the former governor, Charles Foster, was an old boyhood friend of Flagler and a recipient of Standard Oil campaign largesse. In July 1886, O’Day reported to Flagler that the ex-governor had agreed to merge his Fostoria Illuminating Gas Company with the Standard’s Toledo gas start-up to form the Northwestern Ohio Natural Gas Company. O’Day relayed the secret terms of this arrangement: “That Gov. Foster be President of the Co. But that we would have full control of management.” Toledo citizens were delighted when the Eastern Ohio Natural Gas Company decided to vie with Northwestern for a gas franchise; in a compromise settlement, both companies received franchises. Then it surfaced that both rival companies were controlled by Standard Oil, and in the ensuing brouhaha city officials decided, in retaliation, to erect their own municipal gasworks.
Names: Henry M. Flagler · Daniel O’Day · Standard Oil · Charles Foster · Toledo · Ohio · Foster · Fostoria Illuminating Gas Company · Northwestern Ohio Natural Gas Company · Eastern Ohio Natural Gas Company
EPUB paragraph 59 · Text/Cher_9780307429773_epub_c14_r1.htm
Politicians in the Gilded Age tended to dispense with euphemisms, preferring cash on the barrelhead. Having done Standard Oil’s bidding in the gas business, Foster demanded his payoff from Rockefeller in January 1888, saying his campaign committee had a debt of almost $1,200. “My suggestion to you,” he told Rockefeller bluntly, “is that you send me a cheque for this amount.… I have refused to ask you or your people for contributions for several years past. In this case I did it because I know that you feel an interest with us, and for the further reason that I thought it would be helpful in warding off the blows made at you, and at our Gas Co.” In reply, Rockefeller sent Foster a thousand dollars, though he couldn’t resist appending some barbed comments on his past performance. “Our friends do feel that we have not received fair treatment from the Republican Party, but we expect better things in the future.”
Names: John D. Rockefeller, Sr. · Standard Oil · Gilded Age · Foster · Republican Party · Gas Co.
EPUB paragraph 60 · Text/Cher_9780307429773_epub_c14_r1.htm
In 1886, Standard Oil set up the Natural Gas Trust, with Rockefeller as its largest shareholder. As such, he presided over these sordid municipal skirmishes, albeit keeping a sanitary distance. He followed matters closely but never soiled his hands, so that he could profess ignorance of the whole matter.
Names: John D. Rockefeller, Sr. · Standard Oil · Natural Gas Trust
EPUB paragraph 61 · Text/Cher_9780307429773_epub_c14_r1.htm
If Rockefeller tried to deny responsibility for his more deplorable actions, he had legions of critics who loudly proclaimed that he had maliciously ruined them. As Ida Tarbell noted, his foes endowed him with superhuman powers. “Strange as the statement may appear, there is no disputing that by 1884 the Oil Regions as a whole looked on Mr. Rockefeller with superstitious awe.” Each day’s mailbag brought more invective from total strangers who cursed him and pleaded for relief. The most bile flowed from western Pennsylvania oilmen who believed that he capriciously decreed crude-oil prices each morning. As one Bradford producer told him, “The situation here is truly alarming and hundreds of families are in actual distress that need not be if the price of oil was what thousands believe you could make it.” Another correspondent warned him, “There are thousands here on the verge of financial ruin on account of the low price obtained for their product, and if it is within your power to give them a better price you would bestow a boon inestimable in its value to this entire country.” Sometimes these malcontents seemed torn over whether Rockefeller was Satan or Santa Claus, as shown by this muddled query from P. O. Laughner:
Names: John D. Rockefeller, Sr. · Ida M. Tarbell · Oil Regions · Bradford · Pennsylvania · Satan · Santa Claus · P. O. Laughner
EPUB paragraph 62 · Text/Cher_9780307429773_epub_c14_r1.htm
I am a poor devil of a pyker on the oil market and have been in the business for eight years. During all this time I have been cursing the Standard Oil Company with the rest of the boys—curses loud and deep. But with all the anathemas hurled at it the S.O.C. is still in existence and continues to pile up enormous wealth. Now as the market is completely dead and my occupation gone, I have come to the conclusion that it would be wisdom to stop cursing the Standard and strike it for a good fat position.
Names: Standard Oil · S.O.C.
Source: Ron Chernow, Titan. Names and relationships retain the full atlas’s extraction limits. Map points are references; historical sites and regions can be approximate. Open the full interactive atlas.