Storia Americana, Cultura americana

English culture

The rise of industrialism

The people were concerned about the period. With industrialism appears the figure of "the baron," which is a pejorative term used for a powerful 19th-century American businessman. By the 1890s, the term was typically applied to businessmen who were viewed as having used questionable practices to amass their wealth. Allegedly, their "questionable practices" usually included selling the product at extremely low prices (and paying their workers very poorly in order to do so), buying out the competitors that couldn't keep up, and once there was no competition, they would hike prices far above the original level. It combines the sense of criminal ("robber") and illegitimate aristocracy ("baron").

Moreover, there were also some businessmen known as the "captains of industry." A "captain of industry" was a business leader whose means of amassing a personal fortune contributes positively to the country in some way. This may have been through increased productivity, expansion of markets, providing more jobs, or acts of philanthropy. This characterization contrasts with that of the robber baron, a business leader using political means to achieve his ends. Some 19th-century industrialists who were called "captains of industry" overlap with those called "robber barons." These include people such as J.P. Morgan, Andrew Carnegie, Andrew W. Mellon, and John D. Rockefeller. This term can be used also for some famous businessmen of today, as Bill Gates or Steve Jobs.

Rockefeller

John D. Rockefeller (1841–1937) was born in 1841 and he was an American industrialist and philanthropist. He was the founder of the Standard Oil Company, which dominated the oil industry and was the first great U.S. business trust. Rockefeller revolutionized the petroleum industry and defined the structure of modern philanthropy. In 1870, he founded the Standard Oil Company and aggressively ran it until he officially retired in 1897. Standard Oil began as an Ohio partnership formed by John D. Rockefeller, his brother William Rockefeller, Henry Flagler, Jabez Bostwick, chemist Samuel Andrews, and a silent partner, Stephen V. Harkness. As kerosene and gasoline grew in importance, Rockefeller's wealth soared, and he became the world's richest man and the first American worth more than a billion dollars. Adjusting for inflation, he is often regarded as the richest person in history.

Rockefeller spent the last 40 years of his life in retirement. His fortune was mainly used to create the modern systematic approach of targeted philanthropy. He was able to do this through the creation of foundations that had a major effect on medicine, education, and scientific research. His foundations pioneered the development of medical research and were instrumental in the eradication of hookworm and yellow fever. He is also the founder of both the University of Chicago and Rockefeller University. He was a devoted Northern Baptist and supported many church-based institutions throughout his life. Rockefeller adhered to total abstinence from alcohol and tobacco throughout his life.

As an economic fact, he was the richest man in the world. He represented the type of man who started from scratch and built an empire. He is the typical example of an American self-made man. He prolonged the American dream, showing America as the land of opportunity, and the democratic values which are based on the concept of having nothing and succeeding from work is something honest. As said in the Puritan religion, the financial reward or the material success on earth are the proof that you have been elected by God. This concept is really different from the idea of inheriting money without any efforts.

Social Darwinism

Rockefeller can be seen as the embodiment of the idea of Social Darwinism. Social Darwinism is an ideology of society that seeks to apply biological concepts of Darwinism or of evolutionary theory to sociology and politics, often with the assumption that conflict between groups in society leads to social progress as superior groups outcompete inferior ones. The name social Darwinism is a modern name given to the various theories of society that emerged in England and the United States in the 1870s, which, it is alleged, sought to apply biological concepts to sociology and politics. The term social Darwinism gained widespread currency when used in 1944 to oppose these earlier concepts. Today, because of the negative connotations of the theory of social Darwinism, especially after the atrocities of the Second World War (including the Holocaust), few people would describe themselves as Social Darwinists, and the term is generally seen as pejorative.

Social Darwinism is generally understood to use the concepts of struggle for existence and survival of the fittest to justify social policies that make no distinction between those able to support themselves and those unable to support themselves. Many such views stress competition between individuals in laissez-faire capitalism; but the ideology has also motivated ideas of eugenics, scientific racism, imperialism, fascism, Nazism, and struggle between national or racial groups. Opponents of evolution theory have often maintained that social Darwinism is a logical entailment of a belief in evolutionary theory, while biologists and historians maintain that it is rather a perversion of Charles Darwin's ideas. While most scholars recognize historical links between Darwin's theory and forms of social Darwinism, they also maintain that social Darwinism is not a necessary consequence of the principles of biological evolution and that using biological evolution as a justification for policies of inequality amounts to committing the naturalistic fallacy.

Rockefeller's childhood

As a child, Rockefeller became aware of the poverty of his family and his character was shaped by his personal story. His father, first a lumberman, then a traveling salesman, billed himself as a “botanic physician” and sold elixirs. The locals referred to the mysterious but fun-loving man as "Big Bill," and "Devil Bill." He was a sworn foe of conventional morality, who had opted for a vagabond existence and who returned to his family infrequently. Throughout his life, William Avery Rockefeller gained a reputation for shady schemes rather than productive work. Eliza, a homemaker and devout Baptist, struggled to maintain a semblance of stability at home, as William was frequently gone for extended periods. She also put up with his philandering and his double life, which included bigamy. Thrifty by nature and necessity, she taught her son that "willful waste makes woeful want." Young Rockefeller did his share of the regular household chores and earned extra money raising turkeys, selling potatoes and candy, and eventually lending small sums of money to neighbors. He followed his father’s advice to "trade dishes for platters" and always get the better part of any deal. He realized he could rent his money for having interests.

In September 1855, when Rockefeller was sixteen, he got his first job as an assistant bookkeeper, working for a small produce commission firm called Hewitt & Tuttle. He worked long hours and delighted, as he later recalled, in “all the methods and systems of the office.” He was particularly adept at calculating transportation costs, which served him well later in his career. The full salary for his first three months' work was $50 (50 cents a day). From the beginning, he donated about 6% of his earnings to charity. As a youth, Rockefeller reportedly said that his two great ambitions were to make $100,000 and to live 100 years. In 1859, Rockefeller met Mr. Clark, and they founded a refinery, which was directly composed of Clark & Rockefeller, chemist Samuel Andrews, and M. B. Clark's two brothers. The commercial oil business was in its infancy. Whale oil had become too expensive for the masses, and a cheaper, general-purpose lighting fuel was needed.

Beliefs

Rockefeller became a lifelong member of the then-new Republican Party, and a strong supporter of Abraham Lincoln and the party’s abolitionist wing. He was a faithful congregant of the Erie Street Baptist Mission Church, where he taught Sunday school and served as a trustee, clerk, and occasional janitor. Religion was a guiding force throughout his life, and Rockefeller believed it to be the source of his success. As he said, "God gave me money," and he did not apologize for it. He felt at ease and righteous following John Wesley’s dictum, "gain all you can, save all you can, and give all you can."

Oil

In 1866, his brother William Rockefeller built another refinery in Cleveland and brought John into the partnership. In 1867, Henry M. Flagler became a partner, and the firm of Rockefeller, Andrews & Flagler was established. By 1868, with Rockefeller continuing practices of borrowing and reinvesting profits, controlling cost and using refineries' waste, the company owned two Cleveland refineries and a marketing subsidiary in New York; it was the largest oil refinery in the world. Rockefeller, Andrews & Flagler was the predecessor of the Standard Oil Company.

Standard Oil

By the end of the American Civil War, Cleveland was one of the five main refining centers in the U.S. (besides Pittsburgh and Philadelphia). In June 1870, Rockefeller formed Standard Oil of Ohio, which rapidly became the most profitable refiner in Ohio. Standard Oil grew to become one of the largest shippers of oil and kerosene in the country. The railroads were fighting fiercely for traffic and, in an attempt to create a cartel to control freight rates, formed the South Improvement Company, in collusion with Standard and other oil men outside the main oil centers. The cartel received preferential treatment as a high-volume shipper, which included not just steep rebates of up to 50% for their product, but also rebates for the shipment of competing products. Part of this scheme was the announcement of sharply increased freight charges. This touched off a firestorm of protest from independent oil well owners, including boycotts and vandalism, which eventually led to the discovery of Standard Oil's part in the deal. A major New York refiner, Charles Pratt and Company, headed by Charles Pratt and Henry H. Rogers, led the opposition to this plan, and railroads soon backed off. Pennsylvania revoked the cartel’s charter and equal rates were restored for the time being.

Undeterred, though vilified for the first time by the press, Rockefeller continued with his self-reinforcing cycle of buying competing refiners, improving the efficiency of his operations, pressing for discounts on oil shipments, undercutting his competition, making secret deals, raising investment pools, and buying rivals out.

Cleveland

In less than four months in 1872, in what was later known as "The Cleveland Conquest" or "The Massacre," Standard Oil had absorbed 22 of its 26 Cleveland competitors. Eventually, even his former antagonists, Pratt and Rogers, saw the futility of continuing to compete against Standard Oil: in 1874, they made a secret agreement with their old nemesis to be acquired. Pratt and Rogers became Rockefeller's partners. Rogers, in particular, became one of Rockefeller's key men in the formation of the Standard Oil Trust. Pratt's son, Charles Millard Pratt, became Secretary of Standard Oil.

For many of his competitors, Rockefeller had merely to show them his books so they could see what they were up against, then make them a decent offer. If they refused his offer, he told them he would run them into bankruptcy, then cheaply buy up their assets at auction. He saw himself as the industry’s savior, "an angel of mercy," absorbing the weak and making the industry as a whole stronger, more efficient, and more competitive. Standard was growing horizontally and vertically. It added its own pipelines, tank cars, and home delivery network. It kept oil prices low to stave off competitors, made its products affordable to the average household, and to increase market penetration, sometimes sold below cost if necessary. It developed over 300 oil-based products from tar to paint to Vaseline petroleum jelly to chewing gum. By the end of the 1870s, Standard was refining over 90% of the oil in the U.S. Rockefeller had already become a millionaire.

Standard Oil Trust Certificate 1896

In 1877, Standard clashed with the Pennsylvania Railroad, its chief hauler. The railroad, seeing Standard’s incursion into the transportation and pipeline fields, struck back and formed a subsidiary to buy and build oil refineries and pipelines. Standard countered and held back its shipments, and with the help of other railroads, started a price war that dramatically reduced freight payments and caused labor unrest as well. Rockefeller eventually prevailed and the railroad sold all its oil interests to Standard. But in the aftermath of that battle, in 1879 the Commonwealth of Pennsylvania indicted Rockefeller on charges of monopolizing the oil trade, starting an avalanche of similar court proceedings in other states and making a national issue of Standard Oil’s business practices.

Standard Oil gradually gained almost complete control of oil refining and marketing in the United States through horizontal integration. By 1880, according to the New York World, Standard Oil was "the most cruel, impudent, pitiless, and grasping monopoly that ever fastened upon a country." To the critics Rockefeller replied, "In a business so large as ours … some things are likely to be done."