some fun facts about the person, standard oil and how his desire to win helped cause a major economic recession in 1873. Was he a robber baron or a captain of industry?
2. BASIC FACTS ABOUT JOHN
ROCKEFELLER
Is often called a “robber baron” for his cutthroat business practices and
becoming wealthy at the expense of paying his workers low wages
Some called him a “captain of industry” because he brought efficiency
to the oil business, created jobs and sold high quality kerosene to all of
America for use in lamps.
He chose the name “Standard Oil” to guarantee quality and build
confidence in his product (Oil,2012)
3. MORE FUN FACTS ABOUT STANDARD
OIL
A barrel of oil is 42 gallons
This quantity was chosen because a 42 gallon barrel of oil weighs about
300 pounds which was all the teamsters could reasonably load onto a
freight car
Standard oil was shipped in blue barrels to build brand identity
(History, 2016)
When he died in 1937 he was worth $340 billion dollars in today’s
dollars; more than 4 times that of Bill Gates
(O’Donnell, 2014)
4. HOW DID HE TURN STANDARD OIL
INTO A MONOPOLY?
He negotiated a deal with Cornelius Vanderbilt to ship all of his oil at a
33% discount exclusively on Vanderbilt’s trains
He got such a great deal because he guaranteed to keep the freight
cars filled to capacity
Because he got such a low rate on shipping freight he was able earn
more profits than his competitors
After he put his competitors out of business he bought the remains of
their companies at cheap prices and added those refineries to his
empire
(Oil, 2012)
5. ROCKEFELLER INCREASES HIS PROFITS
EVEN MORE BY REDUCING COSTS
He buys a forest so he has his own lumber supply to make barrels
He kiln dries the wood used in his barrels to reduce the weight
This makes his barrels lighter which reduces his shipping costs
These actions drop his barrel making costs from $2.50 to less than $1.00
per barrel
(Blue)
6. THE RAILROADS TURN AGAINST
ROCKEFELLER
Cornelius Vanderbilt and Tom Scott (owner of the Pennsylvania
Railroad) agree to take away any discounts they are giving Rockefeller
and make him pay full price to ship his kerosene
Rockefeller reacts by building pipelines to transport his products and
cuts the railroads out of the process
(Oil, 2012)
7. ROCKEFELLER’S PIPELINES RESULTS IN
THE SHUTDOWN OF MANY RAILROADS
Prior to the development of pipelines, oil shipments were responsible
for 40% of the income of the railroads
Without oil business, many railroads had to shut down
(Oil, 2012)
8. THE RESULTING RAILROAD SHUTDOWN
CAUSED A MAJOR RECESSION IN 1873
The railroads were the largest single employer in the US; without oil
business they laid off many workers
The businesses that supported the railroads had to lay off employees as
well; here are some examples
--lumberjacks lost work since demand for railroad ties decreased
--iron workers lost work since iron wasn’t need for tracks or train
construction
--mechanics were put out of work
(oil, 2012)
9. HE EXPANDED HIS OIL BUSINESS EVEN
MORE
Since many businesses were losing money or declaring bankruptcy he
was able to buy more businesses for lower cost
(Oil, 2012)
10. AFTER THE GOVERNMENT FORCED HIM TO
BREAK UP HIS MONOPOLY HE GAVE OVER
$500 MILLION TO VARIOUS ORGANIZATIONS
University of Chicago
Spelman College
Johns Hopkins Medical School
Eastern European Countries ravaged by WW1
The Baptist Church
The Anti-Saloon League
Medical clinics to fight disease around the world
(Rockefeller0
11. SO. WAS HE A “ROBBER
BARON” OR A “CAPTAIN OF
INDUSTRY”?
I would love to hear your opinion!!!!
12. WORKS CITED
"Blue Barrel." Omeka RSS. N.p., n.d. Web. 09 Feb. 2017.
"History of the 42-Gallon Oil Barrel." American Oil & Gas Historical Society. N.p., 10
Nov. 2016. Web. 09 Feb. 2017.
O'Donnell, Carl. "The Rockefellers: The Legacy Of History's Richest Man." Forbes.
Forbes Magazine, 11 July 2014. Web. 09 Feb. 2017.
<http://www.forbes.com/sites/carlodonnell/2014/07/11/the-rockefellers-the-legacy-
of-historys-richest-man/#3e23030960e7>.
"Oil Strike." The Men Who Built America. A&E. 2012. Television.
"Rockefeller Gifts Total $530,853,632." NY Times, n.d. Web. 9 Feb. 2017.
<http://www.nytimes.com/books/98/05/17/specials/rockefeller-gifts.html>.
