John D Rockeffelar And Northern Securities Essay
John D. Rockeffelar And Northern Securities Essay, Research Paper
In 1859 John D. Rockefeller started one of the greatest monopolies of the progressive era. The Standard Oil Company grew to dominate the oil industry and became one of the first big trust in the United States. In 1870 the Northern Pacific Railway which span from Duluth and St. Paul, Minnesota, to Seattle, Washington and Portland, Oregon. Northern Pacific Railway was the first to offer passenger and service across the Western U.S.
John Rockefeller was born July 8th, 1839, the second of six children. He took a business course at Folsom Mercantile College in 1855. He was employed as an assistant bookkeeper by Hewitt and Turtle. He was paid only $50 for 3 months of work. Moving up to a cashier he made $25 a month.
With $1,000 saved and another $1,000 borrowed form his father, Rockefeller formed a partnership in commission business with Maurice B. Clark. In the same year the first oil well was drilled at Titusville in western Pennsylvania, give a rise to the petroleum industry. Cleveland soon became a major refining center of he booming new industry. In 1863 Rockefeller and Clark entered the oil business as refiners. With Samuel Andrews as their new partner they named the company Andrews, Clark & Co. In 1865 the partnership was broke because of disagreement in management. Rockefeller bought the Company for $72,500 and with Andrews it was named Rockefeller & Andrews.
The oil industry began to expand because of the use of kerosene lamps. Rockefeller renamed the business to Standard Oil Company when his brother William, Andrews, Henry M. Flagler, S.V. Harkness, and others joined his partnership. The company reached a capitol of $1million.
By 1872 Standard Oil had purchased and controlled nearly all the refining firms in Cleveland, also two refineries in New York. The company was able to refine 29,000 barrels of crude oil a day and had its own cooper shop manufacturing wooden barrels. In 1882 Standard merged all its properties into Standard Oil Trusts, increasing the capitol to $70million, and 42 certificate holders. Ten years later the trust was broke up by Ohio court decision. The companies that made up the trust later joined in the formation of Standard Oil Company (New Jersey), since NJ had adopted a law that permitted a parent company to own the stock of other companies. Standard Oil owned three-fourths of the petroleum business in the U.S. in the 1890’s.
Rockefeller wasn’t only the head of Standard, he also owned iron mines and timberland. He invested in many other companies in manufacturing and transportation. Rockefeller retired active leadership from Standard in1896, but help the title of president until 1911. In 1911 the U.S. Supreme Court found Standard Oil Company to be a violation of the anti-trust laws and order the division of the parent NJ corporation. Standard Oil was divided into 32 individual firms. It was said the Rockefeller owned 244,500 of the company’s 983,383 outstanding shares before the companies division.
The Northern Pacific Railway was formed as a special act of Congress in 1864, and began construction in 1870. In 1873 the company went into bankruptcy. In 1883 Henry Billard finished the route from Ashland, Wis., to Portland, Oregon. The company became North pacific Railway in 1896. An agreement between James Hill & J.P. Morgan and E.H. Harriman resulted in the organization of Northern Securities Company. The trust was dissolved in 1904 as a violation of the Sherman Anti-trust Act.
Standard Oil Company and Northern Securities Company were both created for the same reason, to make money. It should only be fair that the business be left open to all instead of controlled by the rich and famous, but neither of the companies planned on taking over the industries. When the market was good they made it easier by taking out the competition. It’s that the way of life. The strong prevail over the weak.