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Bringing down America's House of Oil

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Weinberg admits that the deal was often a win-win for everyone. The US became a major industrial power and inefficient refiners in the US sold out for Standard Oil stock, which often made them comfortable for life. As one editor in oil-rich Titusville, Penn., exclaimed, "Men until now barely able to get a poor living off poor land are made rich beyond their wildest dreaming."

What, then, was the problem? For many Americans, there was none. Ida Tarbell, however, grew up in the Pennsylvania oil fields with a father who chose to compete with Rockefeller rather than sell to him. When Franklin Tarbell proved unable to market oil for eight cents a gallon, he brooded at home and Ida's blissful childhood was damaged. Her brother later became an officer for a competing oil company, adding to the family's grumbling about Standard Oil.

Entrenched at McClure's, Tarbell decided to tell her version of the Rockefeller story. He was a cutthroat competitor, she insisted, who relied on rebates to outsell his rivals. "The ruthlessness and persistency with which he cut and continued to cut their prices drove them to despair," she wrote. Furthermore, he low-balled those whom he sought to buy out. Innuendo became a powerful Tarbell tool: "There came to be a popular conviction that the 'Standard would do anything.' " Even his house was ugly, Tarbell complained.

Taking on monopolies

Her "History of the Standard Oil Company," when published in 1904, came right after a wave of mergers – U.S. Steel, for example, was a billion-dollar company that controlled about 60 percent of the steel market. Were monopolies – with higher prices that would come later – the future for American industry? Competitors of Rockefeller and U.S. Steel were quick to say yes and to ask for a strict interpretation of the Sherman Antitrust Act. Presidents Roosevelt and Taft agreed, and they helped set the precedent that allowed the government to break large companies into smaller pieces.

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