John D. Rockefeller

Born to William (Big Bill) Rockefeller and Eliza Davidson in 1839. He moved frequently as. William was a rolling stone, and often left for weeks and months on end to sell herbal medicines. He was somewhat of a con man. He later started a second family in 1855. The family moved frequently, from Richford to Moravia to Owego NY, eventually landing in Ohio. Chernow argues that John’s even, stoic temperament is a response to the wild nature of his father1.

Guided by a northeastern baptist upbringing, which complimented his capitalist drive (he felt divinely fated to be rich) and even helped build his standing in the Cleveland community.

Came of age in antebellum N.Y. and Cleveland. He was an abolitionist, but did not fight in the war since he was supporting his family. He financed other soldiers to fight in his place.

Got his first job as a book keeper in Cleveland at 16 at the firm Hewitt & Tuttle that primarily traded in produce, but also branched out into iron. Rockefeller was charitable from the start, giving 6-10% of his earnings.

Started his own commodities firm in Cleveland with a colleague named Clark. They briefly had a third partner (Gardner), who Rockefeller ousted after the civil war. The civil war was a boon to the firm with inflation in commodity prices. A third partner, Samuel Andrews was a self taught chemist who began working on refining kersone. He presses Clark and Rockefeller to set up a refinery in 1863. In 1865, Rockefeller buys out the Clarks and owns the firm.

1864 - Marries Laura Celestia “Cettie” Spelman who came from a prosperous family in Cleveland that was having a low period, but still gave John access to a different echelon of Cleveland society. Cettie was religious like John, with a resolve and thrift reminiscent of John’s mother.

Brought his brother William into the firm who moved to New York and worked with the banks to secure financing as John voraciously used capital to spur growth.

Henry Morrison Flager - New partner brought in who strengthened John’s resolve. The new partnership was Rockefeller, Andrews and Flagler in 1867.

There were refinery regions in the early oil period in the Oil Regions (Titusvile, PA), Pittsburg, Cleveland, NY, Philadelphia, and Baltimore. The latter three representing ports out to see, while the first three were inland closer to where the oil was discovered.

Transportation costs factored heavily into oil profits in these days. Rockefeller’s first forays into collusion were with the railroads, where he negotiated cheaper rates through a few tactics:

  1. He played NY central and Erie Railroad against the Pennsylvania Railroad who was shipping crude from Titusville to Philadelphia and NY. This bypassed Pittsburgh, incidentally eradicating that city as a potential refinery competitor
  2. Organizing bulk discounts and guaranteed volumes by consolidating with other smaller refineries
  3. A secret detail with Jay Gould of Erie where he got rebates for oil shipped through the Erie system.

Railroad rebates and preferential rates for larger shippers became a hot button issue in post-Civil War America.

In 1869-1870 Rockefeller begins a campaign to convert competition in cooperation, at least he wanted a cartel, at best a monopoly.

1870 - Dissolves Rockefeller, Andrews, and Flager and starts Standard Oil which sells stock.

South Improvement Company -

1878 - Andrews is bought out for $1M

Died six weeks short of his 98th birthday in 1937.

John D. Rockefeller, Jr.

Heir to his father’s fortune and philanthropic efforts. Junior was vilified for his absentee role Ludlow Massacre. He salvaged his, and the family’s reputation, through a PR tour in Colorado with the miners. Jr. received the bulk of his father’s fortune (in comparison to his siblings). He was an avid art collector and constructed the Cloisters in the upper west tip of Manhattan. Against his wishes, acquiescing to his wife Abby, they were the major benefactors of the Museum of Modern Art1. Junior was also responsible for the construction of Rockefeller Center.

Nelson D. Rockefeller

Son of John D. Rockefeller Jr, served as the governor of NY from 1959 to 1973. He was vice president under Gerald Ford.

Fredrick T. Gates

Fredrick Gates was a baptist clergyman and one of John D. Rockefeller’s closest advisors. He managed Rockefeller’s philanthropy efforts and many of his businesses outside of Standard Oil. Rockefeller called him the greatest businessman he knew. He was instrumental in orchestrating the Mesabi ore windfall1.


References

1.
Chernow, R. Titan: The Life of John D. Rockefeller, Sr. (Vintage, New York, 2004).

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