An American Oil Magnate - John Davison Rockefeller

John Davison Rockefeller (July 8, 1839 – may 23, 1937) was an American oil magnate. 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 first American worth more than a billion dollars. 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 with 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. He had four daughters and one son; john d. Rockefeller, Jr. "junior" was largely entrusted with the supervision of the foundations.

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, Philadelphia, New York, and the region in northwestern Pennsylvania where most of the oil originated). 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. In less than four months in 1872, in what was later known as the "Cleveland conquest" or "Cleveland 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, and 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 to chewing gum. By the end of the 1870's, standard was refining over 90% of the oil in the U.S. Rockefeller had already become a millionaire. Standard oil trust certificate 1896in 1877, standard clashed with the Pennsylvania railroad, its chief hauler. Rockefeller had envisioned the use of pipelines as an alternative transport system for oil and began a campaign to build and acquire them. 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.