J. D. Rockefeller: The dawn of a corporate empire

The history of most of the wealthiest clans around the globe seems to have a common patron: Poor immigrants, running away from the hard conditions of their original countries, arrived to attractive destinations for new opportunities, and thanks to their strategic skills for doing business, climbed up to the highest peaks of the economic and political scenario. The origin of the Rockefellers can be traced from a Jewish-German family of the late sixteenth century in Neuwied, West Germany. The old patriarch was Gotthard Rockenfeller, and it’s the older ancestor of the actual one, David Rockefeller. Very much like the Rothschild family in Austria, Italy, France and England, the Rockefellers emigrated to America in the eighteenth century and quickly became one of the most notorious and powerful clans of the bank and industrial communities of their time.

Rockefeller Center_patrick dwyer merrill lynch_History of American Financial Titans
Image courtesy of remster_9 at Flickr.com

Henceforth, from the midst nineteenth century, John Davison Rockefeller was called the richest man in America, and his surname became a synonym of power and wealth. He was born in 1839 and moved to Cleveland when he was just a boy. He studied at the Commercial School of Cleveland and worked as bookkeeper years later. He gathered enough money for creating his own brokerage company when he was just twenty-five years old and it helped him and his family to invest in the coffee industry years later. His fortune started to increase in a way that had no precedent in that time. With a capital of one million dollars, John and his brother created Standard Oil, after investing and buying another oil company: Clark & Andrews.

Economically, the American Civil War was one of the most positive events for Mr. Rockefeller’s fortune. He created a produce business partnership for feeding the troops during the whole war. At the end of it a quarter million dollars, and the oil boom that took place after it was even more convenient.

Yet, things were not always easy for John Davison Rockefeller. The US government did not like the monopoly that he and his family were building and tried to set obstacles for their economic growth. One of those obstacles was the dissolving of the South Improvement Company: an enterprise he created together with other firms for controlling the most part of the oil refineries of the country, and the rest of the industrial processes involved in that business (production, transportation and distribution). The US government was focused on ruling over the private sector on the country for avoiding monopolies to grow to disproportionate levels, in order to warrantee free competence. The aim of authorities was to foment a general balance for individuals and small companies for investing and developing in a historic moment when such balance was simply inexistent.

When J. D. Rockefeller was asked about free competence, he just replied, in other words, that competence was a sin, and therefore, it had to be erased from the face of Earth. Actually his views on competence, business and ethics were always controversial (and they still keep alive in the memory of his descendants, like David Rockefeller).

It’s a well-known fact that J. D. Rockefeller was not a Nationalist enthusiast. He believed that State interventions in economy are unnatural activities that go against the essence of human and biology nature. There’s a famous quote that shows his Darwinist ideas about business and a summary of his capitalist career: “The growth of a large business is merely a survival of the fittest… The American Beauty rose can be produced in the splendor and fragrance which bring cheer to its beholder only by sacrificing the early buds which grow up around it. This is not an evil tendency in business. It is merely the working out of a law of nature and a law of God.”

Laws against monopolies were not enough to stop the advance of Rockefeller’s empire. After the dissolving of the Standard Oil Trust (which controlled the 95% of the American Oil and was the largest American company then), he creates the Standard Oil Company

Later after the Standard Oil Company dissolved in thirty-seven different companies (currently the most powerful oil companies in the world, like Exxonmobil or Chevron), all of those, of course, remained under his control. He owned the 30% of the shares of every one of them, and other Rockefellers owned other percentages… so the fortunes of J. D. and his family were not affected.

Standard Oil_J. D. Rockefeller_History of American Financial Titans_patrick dwyer merrill lynch
Image courtesy of Pat Hawks at Flickr.com

Probably, the fortune he gathered at the moment of his death was over the nine hundred billion dollars (in 1937’s currency). It made him the richest man of his time, and even today he would be in a Forbes ranking, at least in a top-ten. Three of his most famous ex-Standard companies belong to the current oil main core:

  • Amoco: Standard Oil of Indiana, absorbed by British Petroleum.
  • Sohio: Standard Oil of Ohio, also absorbed by BP.
  • Standard Oil of New Jersey and Standard Oil of New York: They became Exxon Mobil.
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