Surrounded
by round-the-clock armed guards and a barricade of barbed
wire, the body of Laura Celeste Spelman Rockefeller
awaited burial for some twenty weeks between March and
August, 1915, while her husband John Davidson Rockefeller
avoided angry mobs and process servers. At that time
Rockefeller was perhaps the wealthiest man the modern
world had ever known. His personal fortune was equal
to 2 percent of the total gross national product of
the United States and this did not include the vast
fortune passed on to the rest of his family which then
controlled banks, railways and philanthropic foundations
(which were themselves a newly- created device of Rockefeller).
The Standard Oil Companies which he had created and
in which he still held a major (25 per cent.) interest,
then refined more than 90 percent of the oil sold in
America and most of that of the rest of the world. Its
political power was such that it was accused of doing
everything with state legislatures except 'refining
them'.
Yet despite such economic resources,
Rockefeller had become an object of hatred and derision
in America; he could not bury his wife of more than half
a century for fear that the body might be desecrated or
that he might be subpoenaed at the funeral by any of a
dozen governmental bodies investigating his activities.
Indeed, for more than a decade Rockefeller had been hounded
by relentless muckrakers, who portrayed him as a ruthless
robber baron; investigated continually by state attorney
generals and congressional committees who turned him into
a fugitive from his own family; and denounced by political
leaders of both parties as an 'arch-criminal'. Even charities
hesitated to accept Rockefeller's 'tainted money' on the
ground, as Senator Robert M. Lafollette argued, that "he
gives with two hands but robs with many ... he is the
greatest criminal of the age".
In 1915 public passions were further
aroused against Rockefeller by widely circulated reports
of massacres of women and children at the Colorado Fuel
and Iron company which his family controlled. In such
an atmosphere wealth was of little use in quieting public
opinion. Effective power, Rockefeller learned, depended
on control of not merely pipelines, refineries, railways
and banks, but also of the leaders and conduits of public
opinion. And just as the old Rockefeller was able to organise
industries systematically for great profit, his heirs
learned to organise just as efficiently the perceptions
and passions that constitute that vague realm known as
'public opinion'.
John D. Rockefeller, born on a
farm in New York State in 1839, was the son of an adventurer
who had made a small fortune selling patent medicines
and cancer cures which owed their success, if they were
like other 'botanic medicines' of their day, to an opium
base. When John D. reached the age of 20, his father advanced
him sufficient funds to buy a half interest in a commodity
commission business in Cleveland. That same year, 1859,
the first oil well in America was drilled at Titusville,
Pennsylvania, and part of the oil was shipped down the
Cuyohoga River to Cleveland for refining and then re-shipping
to New York. In the next few years, the oil fields of
Pennsylvania became the main source of kerosene for the
entire world and young Rockefeller moved his commodity
business from grain, hay and meat into oil. By the time
he was 26 he had bought out his partners in what was then
the largest refinery in Cleveland, and formed what was
eventually known as the Standard Oil Company. Rockefeller
immediately foresaw that transportation, not production
of oil or retail sales, would be the key to controlling
the burgeoning industry. Any refiner who could ship the
oil for a few cents a barrel less than other refiners
to the major market in New York would drive his competitors
out of business. With this insight, Rockefeller proceeded
to dominate the oil industry.
By negotiating a 'rebate' with
railroads on each barrel his refinery shipped, Rockefeller
received a secret lower rate which allowed him to undersell
all his compctitors in New York. Since greater profits
for all could proceeed from the lower shipping rate, it
was in the self-intcrest of competing refineries to join
Standard. and most of them rushed to exchange their stock
for either Standard stock or cash.
By 1882 the Standard Company was
reorganized by Rockefeller's lawyers into a 'trust' (which
had previously had a benign meaning). The trust
controlled 95 per cent of the refining capacity of the
United States. and Rockefeller, at the age of 43 controlled
it. With this power of this virtual refining monopoly
behind him, he expanded into all phases of the oil industry,
including exploration, shipping and marketing.
Before Americans were subject
to income tax, the dividends from Standard Oil made Rockefcller
the wealthiest man in the country. Eventually, the government,
first the states and then the Federal, moved against Standard
Oil and laws were passed against 'rebates' and 'trusts
. Finally in 1911 under the crusading zeal of President
Theodore Roosevelt, the Standard Oil trust was dissolved
into 33 separate companies of which the Rockefellers remained
large shareholders (receiving about 25 per cent of the
shares of each new company).
Rockefeller's organizational genius
was not limited to oil. During the boom of the 1890s,
he bought up a large share of the entire Pacific Northwest,
including railways, steel mills, paper mills, factories,
ore deposits, lumber, and vast tracts of real estate,
including the entire city of Everett in the state of Washington.
A dedicated Baptist, he founded the University of Chicago
on the condition that it be "aggressively Christian" with
no "infidel teachers". He also created tax-exempt foundations
for the "well being of mankind" (just before income tax
laws were passed in the United States) which changed the
shape of 'philanthropy' in the United States, and insulated
a large portion of his fortune from modern taxation.
Rockefeller, who had wanted to
live until 100, died in his sleep from sclerotic myocarditis
at the age of 97 at The Casements, his Winter home, in
Florida. None of his immediate family was with him at
the end. A special car was sent to Florida to bring back
his body for a funeral at Pocantico Hill and a burial
in Lakeview Cemetery in Cleveland, where Rockefeller had
began his empire as a $12-a-month clerk. |