John D Rockefeller born on July 8th, 1839 was a man who was willing to do hard work. As a teenager, he went on many small-business ventures and by the age of 20, he had created a company with a business partner in a year grossing 450000$. In the early 1860's, the government's new promotion of businesses instead of agriculture allowed for many to find weaknesses of the economy and take advantage of it. Rockefeller saw an opportunity in the oil businesses and established his own oil refinery in 1863 near Cleveland. Within a couple years, sure enough, the oil refinery was doing very well and Rockefeller decided to allocate all his time and energy into the refinery. At the age of 24, Rockefeller bought out the Clark brothers, which was his business partner and fully owned the company. Rockefeller borrowed lots of money and was able to make it back with his dominating company in the thriving economy. In 1970, Rockefeller, his brother and associates created Standard Oil, which prospered in the thriving economy and industrial conditions of America. Rockefeller became the President and the largest shareholder of Standard Oil with 30% of the shares. With his success, Rockefeller was able to buy competitors and within a couple of years, Standard Oil controlled most of the oil refineries near Cleveland. With the technological advancement of the Railroad system, Rockefeller used Standard Oil's size and made favorable deals with railroads to ship Standard Oil. Standard Oil controlled every aspect of the business of oil and squeezed out smaller competitions or bought out those who were willing to be bought. Soon, the people and Congress noticed what Standard Oil was doing, and it's actions were not popular in the minds of the people. Being too powerful and too dominant, Congress tried controlling Standard Oil with the Sherman Anti-Trust Act. Rockefeller tried dissolving his company and giving pieces of it to those he trusted to be managed, however in 1911, Rockefeller's actions were deemed unconstitutional and Standard Oil was destroyed. John D Rockefeller set up a legacy of being one of the world's richest men and his actions allowed for the government to amend it's weaknesses.
http://www.biography.com/people/john-d-rockefeller-20710159
http://www.pbs.org/wgbh/americanexperience/features/biography/rockefellers-john/
It is interesting to note (connecting to a blog post I just made) that Standard Oil exhibited horizontal integration in the refining sector, but also followed the vertical model later on. Standard eventually ended up owning most production regions for oil. However, it was also often the target of antitrust sentiment because it was too big for other companies in the market to compete.
ReplyDeletehttp://www.britannica.com/topic/Standard-Oil-Company-and-Trust