Why do you admire John D Rockefeller
John D. Rockefeller was an unusually pious man, a living example of the Protestant ethic thesis developed by sociologist Max Weber in 1904, shortly after the turn of the century before last. The earthly success, fueled by asceticism, so goes Weber's explanation for American capitalism, already gives an indication of the further fate in the afterlife. And Rockefeller was successful: long before Warren Buffett or Bill Gates, he accumulated one of the greatest fortunes in world history.
Amazon, Facebook and Google dominate the market today, in the "Gilded Age", in the gilded age of the late 19th century, a few entrepreneurs succeeded in doing this with their trusts: Andrew Carnegie, Marshall Field, Jay Gould, JP Morgan, Cornelius Vanderbilt, Leland Stanford and above all Rockefeller.
For Rockefeller, money was a gift from God. He worked from morning to night, went to church on Sundays, gave to the poor and brutally got rid of the competition. At his death in 1937 he had residual assets of 1.4 billion dollars, based on today's purchasing power that would be between 30 and 340 billion, depending on the conversion. There is no reliable information about his further life in the hereafter, but to be on the safe side he had ensured his earthly fame.
Not only was John D. Rockefeller one of the richest men in world history, he also went down as a benefactor by following a simple maxim: "In my opinion, a man has a duty to make as much money as is honestly possible to earn and then give away as much as possible. " This generosity was not limited to setting up universities, money for medical research and many charitable foundations, but he also considered lawyers and politicians who had to keep his money and power for him. For a while he didn't even try to bribe politicians, writes a biographer, "perhaps because he didn't know how."
But Rockefeller knew how to make money, how to make a tremendous amount of money. He was the invisible hand in the Gilded Age, in that long-forgotten end of the century, which preacher Josiah Strong considered the most important decade since the coming of Christ for a reason. After the end of the Civil War in 1865, the United States' economy picked up tremendously. The west was conquered one more time, this time by steam engine, and then electrified. The Bessemer process made it possible to refine iron into the steel it needed for high-rise construction and the railways that ran across the country. Agriculture was also mechanized and industrialized, if only to meet the growing demand in the swelling cities. Oil was the lubricant in the biggest boom the US has ever seen.
The first oil boom in Pennsylvania in 1859 made some people rich for a short time, but Rockefeller knew how to perpetuate the wealth and, above all, derive a large part of it for himself by investing in oil processing and the transportation of oil. In 1870 he founded Standard Oil, a pool of various companies in Cleveland, all of which had dedicated themselves to the exploitation of this raw material. Rockefeller is there when a new well opens up, has the crude oil bottled in its barrels and transported east to its refineries and finally to the coast, where the demand grows inexorably. Since he can guarantee the largest quantities, the railway companies give him considerable discounts. He passes part of it on to the consumer and thus drives the competition out of the market, which cannot keep up with this calculation. At the same time, he has pipelines laid quickly and, as a precaution, buys the land away from the competition so that they cannot lay pipes themselves and thus endanger his soon-to-be monopoly position. Finally he gets into the financing business, in which J. P. Morgan is already active, who has made money with his railways.
In just a few years, a self-reproducing, multi-headed monster emerged. An overview of the multiple interdependencies between steel, railways, insurance companies, banks and the oil industry was no longer possible. In a contemporary report there is confused talk of the Standard Oil Company, the Standard Trust Company, and "other companies under different names owned or controlled by Standard". The Rockefeller Trust was, after all, twenty times the size of its nearest competitor.
A resilient connection to politics was essential for this resounding earthly success. One of them was Matthew S. Quay, who in 1879 applied for a "loan" of $ 15,000, which he was willingly granted. Under the code name "Black," Quay stayed on Rockefeller's payroll for 25 years while serving as Chairman of the National Republican Committee and a member of the Senate.
Even contemporaries were uncanny about this power of a few magnates, they became robber barons scolded, modern robber barons, but they didn't feel guilty about it. Rockefeller had no qualms about his godly work. In a single year he took over 22 of 26 competitors in Cleveland alone. The fact that he did not eat them all up was again a tactical one: He can always point out that their existence refuted the accusation that Standard Oil had a monopoly.
Rockefeller was reluctant to be summoned to court or an investigative committee. Rockefeller testified before the Industry Commission in 1900 that his trust came about because he wanted to combine skills and capital in order to grow his company through profitability and efficiency, and immediately took the opportunity to present himself: "While the company was getting bigger and domestically like When more and more employees and more capital and new companies were added abroad, it was always about one thing, namely to expand our business by delivering the best and at the same time cheapest items. " There was no mention of the workers who made this wonderful success possible for reasons of time.
Competition would not have stimulated good business, it would have lowered profits because sales would have been distributed among more market participants. Therefore, if the opponent did not join the trusts, he was not only spied on, but also sabotaged if necessary. In 1887, John Rockefeller had to appear in Buffalo in court. In the negotiating room a threat was read out by one of his people against the boss of a small competing company: "We have 75 million and we will destroy you." When that didn't help, an employee of the company in question was bribed, who then overheated the boiler, blocked the safety flap and caused a series of explosions that almost blew up the entire company premises.
At the height of this development, three hundred trusts had been formed. Since the monopolists divided the market among themselves, there has been criticism of their methods. The economist Werner Sombart saw the "naked tendency towards unrestricted acquisitions" at work in the United States. For Sombart, who was initially influenced by Karl Marx, "capital was piled senselessly on capital: why? Because business is growing".
What was completely incomprehensible to an outsider was day-to-day business for Rockefeller, Morgan, Vanderbilt and Carnegie. Any form of influence and control was repugnant to these robber knights. When in doubt, unions were seen as the devil's tools. When in 1892 the workers at Andrew Carnegie's steel mill in Homestead, near Pittsburgh, refused to accept wage cuts and longer hours, they were locked out. Carnegie's partner, Henry Clay Frick, tried to resolve the labor law disagreement in his own way: he hired a heavily armed raid from the Pinkerton Agency. Several people died.
The call to smash the tech giants of our time - Amazon, Facebook, Google or Apple - is not entirely new. There is definitely sympathy for this in the EU Commission. The American presidential candidate Elizabeth Warren, who wants to run against Donald Trump in 2020, spoke out in early March in favor of considering splitting up large corporations. Companies with a certain annual turnover could be broken down into a part that takes care of the infrastructure and a second part that is responsible for the content. Warren and others believe that the big platforms that hold our data have become way too powerful.
Over the years, resistance to this economic omnipotence policy grew stronger. In the magazine McClure's its editor announced: "For the general public today there is no question more interesting, more important and more complicated than the one about the trust." Ohio Rep. James A. Garfield said that the federal agencies should deal with Standard Oil; In 1890, under the presidency of Benjamin Harrison, who had helped Quay into office, the Sherman Act was passed, a law against the overwhelming power of the monopolies. This was intended to prevent a "restraint of trade", the obstruction or restriction of trade and the movement of goods. It was worded so weakly that it was adopted almost unanimously in Congress and consequently had no major effect. A surprising economic downturn required pro-business policies anyway, and the Supreme Court hastened to interpret the Sherman Act so that, if in doubt, it was not the monopolies that affected trade, but the unions.
Since wealth was pleasing to God, criticism of it inevitably seemed like blasphemy. That was the press hour. The heyday of the magnates also brought the first heyday of reporting. Journalists denounced the grievances that politicians didn't want to deal with for a long time. Ida Tarbell wrote about Standard Oil, Lincoln Steffens about the corrupt cities and Upton Sinclair about the meat factories in Chicago. For Steffens, this American economic boom society was corrupt to the core, because it had submitted to a "boss". "There is no essential difference between a corrupt union, a corrupt bank and a corrupt party headquarters," he preached to his fellow citizens in 1904. "Nothing between a union boss like Sam Parks, a banking boss like John D. Rockefeller, a railroad boss like JP Morgan and a political boss like Matthew S. Quay. The boss is not a political, but an American institution that produced a liberated people, that does not know the spirit of freedom. "
Politics only hesitantly followed this moral indignation. Theodore Roosevelt, the governor of New York and comparatively independent of economic interests, railed against the "criminal class of the rich". The Attorney General actually began an investigation into J. P. Morgan's Northern Securities for violating the Sherman Act. Roosevelt had meanwhile become president and, unlike his predecessors, no longer allowed himself to be traded. During his presidency there were sixteen civil and eighteen criminal cases against the corporations.
The decisive attack on Standard Oil did not succeed until 1911. More than two decades after the passing of the Sherman Act, the first noteworthy judgment was issued against a trust. Standard Oil was smashed into 34 sole proprietorships. However, the resolution failed to serve its purpose. The shareholders of the holding company were awarded shares in the various subsidiaries. This created an interest group of the newly formed individual companies so that they continued to work together without the need for joint management. The price fell on the stock exchange, which Rockefeller used to buy up the cheap shares and get even richer.
He was lucky too, namely progress on his side. The demand for petroleum declined when Thomas Edison invented the electric bulb. But by then the automobile was ready, and instead of falling, the demand for oil just kept increasing. The war in Europe also increased sales. Nobody benefited more from the break-up of his corporation than its founder, John Rockefeller.
Max Weber saw the "mechanized petrification" coming in America's earthly success story, as well as "professionals without a mind, pleasure-seekers without a heart: this nothing imagines that they have climbed a level of humanity that has never been reached before". A modern robber baron like Rockefeller, who appears several times in Weber's texts, would not have understood this characterization and certainly not related to himself. Like Andrew Carnegie, he had a heart for the poor, and J. P. Morgan was also a great benefactor. The cultural life on the American east coast still feeds on it today. Henry Clay Frick, who had his steel workers shot, built an elegant house in New York and acquired an exquisite collection of old masters. If you visit the Frick Collection on Fifth Avenue not far from Trump Tower, you can admire three precious Vermeers there. According to the will of the testator, they are not allowed to leave the house.
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