John D. Rockefeller was a businessman who amassed one of the largest fortunes in history.
He controlled 90% of the oil in the country, and at the time of his death, he was worth
between $300 and $400 billion.
Today, the name “Rockefeller” is synonymous with wealth for good reason, and his legacy
has lived on long after his death.
Today on Biographics, we tell the story of how a seemingly ordinary boy grew up to be
the most powerful man in the United States.
Early Life and Career John D. Rockefeller was born on July 8, 1839
in Richford, New York.
His mother, Eliza Davidson, had a total of six children.
His father, William Avery Rockefeller, called himself a traveling “botanic physician”.
This may sound impressive, but this was actually just a fancy name for a snake oil salesman.
His father earned the nickname “Big Bill” for his larger-than-life personality.
These types of salesmen knowingly sold fake products to people, promising that their so-called
elixirs could cure practically anything.
They were usually charismatic showmen who truly knew how to get people so excited about
a product to the point where they were practically begging to give their money away.
While Big Bill was traveling across the country, essentially stealing money from unsuspecting
victims, he would spend some time in a each town before catching the next train.
He started a double life with a woman named Nancy Brown, and had children with her.
Despite being so good at his job, Big Bill always seemed to struggle with money, and
there never seemed to be enough to go around when he came back to visit Eliza and their
six children.
John D. Rockefeller was raised by his father to never trust anyone.
Big Bill opened his arms to catch John when he was still just a toddler, but when the
boy jumped, his father stepped back, and let him fall on the floor to teach this lesson.
Bill would also trick John and his brothers by making promises he never intended to keep,
just so he could get them to do extra chores.
Big Bill once said, “I cheat my boys every chance I get.
I want to make 'em sharp.”
John Rockefeller was the oldest son in his family, so he was the “man of the house”
when his father was gone.
As a child, he would help his mother raise turkeys in their backyard so that they could
sell the meat.
They did odd jobs for their neighbors, and for the most part, were forced to fend for
themselves without much help from his father.
At one point, Bill decided to come clean to both of his wives, and revealed that he was
splitting his free time between two households for years.
He suggested that they all move in together as one big happy family.
This was bigamy, of course, but it was not illegal in the United States at that time.
The Morrill Anti-Bigamy Act was passed in 1862 after polygamy became more prevalent
among members of The Church of Jesus Christ of Latter Day Saints.
But the Rockefellers weren’t a part of the LDS Church.
He truly must have been a smooth talker, though, because he somehow convinced both Eliza and
Nancy to agree to a Sister Wives situation.
The family moved to Cleveland, Ohio, and they told their new neighbors that Nancy Brown
was their live-in housekeeper.
Rockefeller was disgusted by his father’s behavior, and he swore that he would never
grow up to become that kind of man.
He decided to save his money, and never waste it on frivolous things.
He also became very devoutly religious in the Baptist church, and held himself to a
high moral standard.
This difficult family situation was most likely why he chose to start working as quickly as
possible, so he could move out and start an independent life away from his parents, and
his father's mistress.
He often said that his goal was to make $100,000 (the equivalent of almost $3 million dollars
today), and live to be 100 years old.
Rockefeller attended Cleveland Central High School.
But he did not want to wait until after graduation to become a businessman.
So he dropped out of High School and took just one business and accounting class at
Folsom Mercantile College.
This was enough experience to get him a job as a assistant bookkeeper for local merchants
called Hewett & Tuttle on September 25th, 1855, when he was just 16 years old.
He gained a lot of valuable experience at this job, but the only trouble was that his
bosses only paid him 50 cents a day.
Even after inflation, that’s still only $13.36, which was nowhere near enough to make
a full-time living.
Even though they weren’t paying him much, Rockefeller was always extremely proud of
the day he got his first job.
He made September 25th into his own holiday called “job day”, and he celebrated the
anniversary every year for the rest of his life.
Luckily for Rockefeller, he had been friendly with the customers at Hewett & Tuttle.
This gave him a great reputation around town.
He was always paying close attention to how everything worked, and he eventually learned
all of the skills necessary to start his own business.
Since everyone in town knew him, he managed to get a $4,000 loan, which is worth over
$100,000 today.
This was more than enough to start trading in goods like hay, meat, and grain.
His business managed to earn $450,000 in the very first year.
He didn't get to keep that money for himself, of course, because a lot of that had to go
back into repaying the loan and business expenses.
But this was a great start to what would be a long and prosperous career in business.
John said, "God gave me money", and he did not apologize for it.
In 1861, the United States broke out into Civil War, and Rockefeller felt very strongly
about being an Abolitionist.
Rockefeller's younger brother Frank became wounded in battle very early in the war.
When John was drafted, he actually paid a professional soldier to go in his place.
That way, he was able to continue running his business and contribute to the war effort
at the same time.
He said, “I wanted to go in the army and do my part, but it was simply out of the question.
There was no one to take my place.
We were in a new business, and if I had not stayed it must have stopped—and with so
many dependent on it.”
Believe it or not, this was actually a common practice back then, at least for the men who
could afford to do so.
And by staying home, he was able to profit from selling supplies to the war effort.
Black Gold Today, the oil industry is concentrated in
the Middle East.
But for years, it was readily available in the United States.
In 1849, a man named Samuel Kier discovered crude oil on his property in Titusville, Pennsylvania.
By the 1850’s and 60’s, word spread, which caused a huge boom known as the Pennsylvania
Oil Rush.
Men were moving to Pennsylvania hoping to make it rich by setting up oil rigs and tapping
the ground for their liquid black gold.
At that time, people needed oil for their lamps to see at night.
The only alternative was to process oil from whale fat, but taking it from the ground was
obviously a much easier process.
However, the crude oil that is found in the ground still needs to be refined before it
was ready to be used by consumers.
Crude oil was being transported by train from Pennsylvania to various oil refineries around
the country.
John D. Rockefeller had the brilliant idea to take advantage of the rush by building
an oil refinery in Cleveland, Ohio.
He was 24 years old at this point, and he decided that instead of continuing to be a
merchant, he should devote all of his time and energy to growing his new oil business.
Rockefeller was still very frugal, so he tried to save money by cutting out the middleman
whenever possible.
Instead of buying wooden barrels from a third party company, he bought thousands of acres
of land so that his employees could cut down trees and make the barrels themselves.
In 1870, he met a man named Henry M. Flagler who was interested in investing in Rockefeller’s
business.
So, they incorporated The Standard Oil Company.
With Flagler’s help, Rockefeller began to buy up all of the smaller oil refineries in
the Cleveland area so that he no longer had any competitors.
Whenever any refinery refused to sell their company to him, Rockefeller would begin selling
his oil at a loss, so that customers would flock to him, instead of the competition.
This would put the small companies out of business.
But he didn’t stop there.
Standard Oil began to spread to other states, and soon enough, they were refining 90% of
America’s oil.
He was now a millionaire.
At this point, the company was so huge, it was impossible for one man to oversee the
operations of the entire country.
So he decided to allow the former heads of the oil companies he purchased to become his
new board of trustees.
This created a super squad of the smartest oil experts in the country, and he made himself
the head of the so-called “trust.”
This sounds typical for large companies today who put a CEO as the figurehead.
But back then, this kind of empire was unheard of, and Rockefeller was setting the stage
for other American businesses as a leading example on how to acquire wealth and power.
The Battle Of The Railroads In the 1800’s, railroads were helping to
aid America through the Industrial Revolution.
For the first time in history, large cargo could be shipped across the country at record
speeds.
By the 1860’s, the two biggest businesses in the United States were the railroads, and
oil.
So it only made sense that Rockefeller wanted to be involved in both.
He was actually plotting to create a railroad trust, and do exactly what he had done with
the oil businesses.
He was already cooperating with the Vanderbilt family, and he was going after the owners
of various railroads to purchase their stock and strike deals with the Presidents of each
one.
Rockefeller needed to be on good terms with railroads, because he needed them to transport
his barrels of oil by train.
Since he had such a massive quantity of product, he negotiated with the Pennsylvania Railroad
to get a discounted rate on shipping.
At first, this was working out really well, and The Pennsylvania Railroad went on a spending
spree to expand the railroad.
Before long, the discount they gave Rockefeller was no longer enough to cover their costs,
and it would potentially bankrupt the company.
So they had to go back on their promise, and raise the price.
Instead of giving in, Rockefeller responded by laying his own underground pipelines, and
he reached out to work with other railroad companies.
Now, The Pennsylvania Railroad had lost its biggest client, and main source of income.
In 1877, The Pennsylvania Railroad started building their own oil refinery, so that they
could put their trains to good use.
After all, the oil industry was their bread and butter, whether it came from Rockefeller
or not.
Since Rockefeller felt entitled to control all of the oil, he was outraged.
He stormed in to speak to speak to the executives of the railroad, saying, “Why, it is nothing
less than piracy!”
To make matters worse, the railroad employees began to strike across the nation, because
they were not getting paid.
This became known as the Great Railroad Strike of 1877.
They finally buckled under the pressure, and sold their oil refinery to Rockefeller for
$3.4 million.
Ten years later, in 1887, the US Government would pass the Interstate Commerce Act, which
forced regulations on the prices charged by railroads.
This prevented those companies from gouging the price for transportation.
From an outsider’s perspective, people did not see a railroad that broke a contract.
They saw Rockefeller as the villain, instead.
People believed that he had far too much power.
Everyone could see the writing on the wall- If Rockefeller wasn’t stopped, he may take
over the railroad industry completely, and after that, there would be no stopping him
from taking more, and more, until there was nothing left for anyone else.
Public Outcry The general public strongly disapproved of
Rockefeller's tactics, and they believed that he was like a shark gobbling up small businesses.
It had already happened in the oil industry, and he was making moves in the railroad industry.
People were terrified that he would eventually be so rich and powerful, he just might take
over the world.
Newspapers bashed Standard Oil, and political cartoons featured Rockefeller on a regular
basis.
Even President Teddy Roosevelt was very vocal about being “Antitrust”, and promised
Americans that he was going to do something to stop it.
The state of Ohio planned to create new Antitrust laws specifically to stop Rockefeller and
Standard Oil from having a monopoly over the entire industry.
Since it was only a state law at that point, Rockefeller was able to reincorporate in New
Jersey in 1882 before they even had a chance to sue him.
He opened his new headquarters on Broadway in New York City.
Reincorporating in another state did not protect him for long, because in the year 1890, US
Congress passed the Sherman Antitrust Act, which made it illegal in every state.
Two years later, the Supreme Court declared that Standard Oil was violating this new law.
So, how did Rockefeller deal with dissolving his monopoly?
Well...He didn’t.
He figured out a legal loophole, of course.
The board of trustees divided up Standard Oil amongst themselves, and created smaller
companies so that- technically- they would no longer be considered a monopoly.
In 1899, these new companies were all brought back under the umbrella of Standard Oil.
These are called “subsidiaries”, which is when a small company is under the control
of a larger corporation.
Just a few examples of these smaller companies were BP, Exxon, Conocophillips, and Chevron.
They’re all still around to this very day.
At that time, there was a group of writers and journalists called the “muckrakers”,
and they took it upon themselves to uncover corruption in American businesses.
One such journalist, Ida Tarbell, wrote a book in 1904 called The History of the Standard
Oil Company, where she went through the story of Rockefeller’s ruthless rise to power.
She wrote, “Rockefeller and his associates did not build the Standard Oil Co. in the
boardrooms of Wall Street banks.
They fought their way to control by rebate and drawback, bribe and blackmail, espionage
and price cutting, by ruthless ... efficiency of organization.”
Tarbell is remembered for being one of the most successful investigative journalists
of her time, and many credit her and the other muckrakers with helping to dismantle the Rockefeller
monopoly.
But, of course, people in the general public did not realize that those new oil companies
were not due to small businesses making a comeback.
Rockefeller truly was still pulling the strings, and for him, a rose of another name was just
as sweet.
Personal Life Even though there is plenty of information
out there about the financial success of John D. Rockefeller, he was a fiercely private
person, and he tried his best to keep his family out of the newspapers.
What we do know is that when he was 25 years old in 1864, he married a woman named Laura
Spelman.
She was a devout Christian who worked as a school teacher, and they were very much in
love with one another.
He said of her, "Her judgment was always better than mine.
Without her keen advice, I would be a poor man."
He wrote her beautiful love letters when he had to travel for business.
He once wrote “What a blessing that I have such a good and true wife.
How much I would give for wings to reach you tonight.”
All of this romance lead to the creation of their children together; Elizabeth, Alice,
Alta, Edith, and John Jr. Sadly, Alice died during infancy.
Even though he was very busy, he always made time to be with his family.
He was a loving father and a devoted husband who never took them for granted.
All his life, Rockefeller had a very impressive mustache, but during the 1890s, he began suffering
from a condition called alopecia.
He began to lose all of the hair from his entire body, including his eyebrows.
At first, he tried to hide it by wearing toupees, but as he grew older, he decided to let people
see him in public after he had lost all of his hair.
In the 1990’s, a biographer named Ron Chernow got permission from the Rockefeller family
to write a biography.
He learned by speaking to his children and grandchildren that Rockefeller never spoke
much about his father, and he never allowed “Big Bill” to be apart of their lives.
They also never met his half-sisters, and they were never given any of the fortune,
because Rockefeller did not consider them to be apart of his real family.
After digging through a mountain of paperwork, Ron Chernow finally found William Avery Rockefeller’s
grave in a small cemetery in Freeport, Illinois.
He was buried under an alias called “Dr. William Levingston.”
It would seem that even in death, John D. Rockefeller wanted the memory of his father
to be forgotten.
Retirement, Philanthropy, and Legacy In 1897, John D. Rockefeller chose to retire
from his position at Standard Oil, and left the control of the business to his board of
trustees and his son, John D. Rockefeller Jr.
In 1911, Standard Oil was sued once again for violating the Antitrust Act, and they
were forced to split up into dozens of different corporate entities.
But he decided to invest in all of these new companies, and ironically, it only made him
more money on the stock market.
Estimates of John D. Rockefeller Sr.’s true net worth vary anywhere from $300 to $400
Billion dollars.
To put that into perspective, the founder of Amazon.com, Jeff Bezos is the current richest
man in the world today, and yet he is only worth $100 Billion.
It's probably not a coincidence that Bezos also practiced the same exact method that
Rockefeller once did, by buying out smaller online bookstores during the expansion of
Amazon.com.
Now, most people try to vilify John D. Rockefeller, but he wasn’t all bad.
He believed in the Christian tradition of “tithing”, so he had been giving a portion
of his income to charity since he was 16 years old.
He gave $70 million towards the founding of the University of Chicago, and he also helped
to fund the Spelman College in Atlanta, Georgia, which was an all-black women’s school.
According to the New York Times, Rockefeller gave away $550 million in charitable donations
to scientific research, education, and the Baptist church.
Rockefeller became well known in his later life for the practice of giving dimes to adults
and nickels to children wherever he went.
He even gave dimes as a playful gesture to wealthy men, such as tire mogul Harvey Firestone.
One of the best examples of his generosity also doubled as his legacy.
In the year 1930, Americans were suffering after the Great Depression.
John D. Rockefeller was already in his 90’s, so he decided to use a huge chunk of his fortune
to build the Rockefeller Center in New York City.
It was called a “city within a city”, because it had dining, shopping, apartments,
and even a movie studio.
The project created 40,000 new jobs during construction, and people were gainfully employed
once all of the businesses inside of the Center were opened.
The project was complete in 1933, and today, the Rockefeller Center has become an iconic
part of Manhattan, especially during Christmas time.
Biographer Ron Chernow wrote of Rockefeller, “What makes him problematic—and why he
continues to inspire ambivalent reactions—is that his good side was every bit as good as
his bad side was bad.
Seldom has history produced such a contradictory figure.”
John D. Rockefeller died just one year after the completion of his center, in 1934.
He often told people that his goal was to live to be 100 years old, but he didn’t
make it past 97.
Perhaps the best way to summarize his life was a poem Rockefeller wrote himself, at age
86: I was early taught to work as well as play,
My life has been one long, happy holiday; Full of work and full of play—
I dropped the worry on the way— And God was good to me everyday.