Rockefeller Essay, Research Paper

John Davison Rockefeller (July 8, 1839 – May 23, 1937) was the guiding force behind

the creation and development of the Standard Oil Company, which grew to dominate

the oil industry and became one of the first big trusts in the United States, thus

engendering much controversy and opposition regarding its business practices and form

of organization. Rockefeller also was one of the first major philanthropists in the U.S.,

establishing several important foundations and donating a total of $540 million to

charitable purposes.

Rockefeller was born on farm at Richford, in Tioga County, New York, on July 8, 1839,

the second of the six children of William A. and Eliza (Davison) Rockefeller. The family

lived in modest circumstances. When he was a boy, the family moved to Moravia and

later to Owego, New York, before going west to Ohio in 1853. The Rockefellers bought

a house in Strongsville, near Cleveland, and John entered Central High School in

Cleveland. While he was a student he rented a room in the city and joined the Erie

Street Baptist Church, this later became the Euclid Avenue Baptist Church. Active in its

affairs, he became a trustee of the church at the age of 21.

He left high school in 1855 to take a business course at Folsom Mercantile College. He

completed the six-month course in three months and, after looking for a job for six

weeks, was employed as assistant bookkeeper by Hewitt & Tuttle, a small firm of

commission merchants and produce shippers. Rockefeller was not paid until after he had

worked there three months, when Hewitt gave him $50 ($3.57 a week) and told him

that his salary was being increased to $25 a month. A few months later he became the

cashier and bookkeeper.

In 1859, with $1,000 he had saved and another $1,000 borrowed from his father.

Rockefeller formed a partnership in the commission business with another young man,

Maurice B. Clark. In that same year the first oil well was drilled at Titusville in western

Pennsylvania, giving rise to the petroleum industry. Cleveland soon became a major

refining center of the booming new industry, and in 1863 Rockefeller and Clark entered

the oil business as refiners. Together with a new partner, Samuel Andrews, who had

some refining experience, they built and operated an oil refinery under the company

name of Andrews, Clark & Co. The firm also continued in the commission business but in

1865 the partners, now five in number, disagreed about the management of their

business affairs and decided to sell the refinery to whoever amongst them bid the

highest. Rockefeller bought it for $72,500, sold out his other interests and, with

Andrews, formed Rockefeller & Andrews.

THE STANDARD OIL COMPANY

Rockefeller?s stake in the oil industry increased as the industry itself expanded, spurred

by the rapidly spreading use of kerosene for lighting. In 1870 he organized The

Standard Oil Company along with his brother William, Andrews, Henry M. Flagler, S.V.

Harkness, and others. It had a capital of $1 million.

By 1872 Standard Oil had purchased and thus controlled nearly all the refining firms in

Cleveland, plus two refineries in the New York City area. Before long the company was

refining 29,000 barrels of crude oil a day and had its own cooper shop manufacturing

wooden barrels. The company also had storage tanks with a capacity of several

hundred thousand barrels of oil, warehouses for refined oil, and plants for the

manufacture of paints and glue.

Standard prospered and, in 1882, all its properties were merged in the Standard Oil

Trust, which was in effect one great company. It had an initial capital of $70 million.

There were originally forty-two certificate holders, or owners, in the trust.

After ten years the trust was dissolved by a court decision in Ohio. The companies that

had made up the trust later joined in the formation of the Standard Oil Company (New

Jersey), since New Jersey had adopted a law that permitted a parent company to own

the stock of other companies. It is estimated that Standard Oil owned three-fourths of

the petroleum business in the U.S. in the 1890s.

In addition to being the head of Standard, Rockefeller owned iron mines and timberland

and invested in numerous companies in manufacturing, transportation, and other

industries. Although he held the title of president of Standard Oil until 1911, Rockefeller

retired from active leadership of the company in 1896. In 1911 the U.S. Supreme Court

found the Standard Oil trust to be in violation of the anti-trust laws and ordered the

dissolution of the parent New Jersey corporation. The thirty-eight companies which it

then controlled were separated into individual firms. In his biography, Study in Power,

John D. Rockefeller, Industrialist and Philanthropist, the historian Allan Nevins reports

that Rockefeller at that time owned 244,500 of the company?s total of 983,383

outstanding shares.

PHILANTHROPY

Rockefeller was 57 years old in 1896 when he decided that others should take over the

day-to-day leadership of Standard Oil. He now focused his efforts on philanthropy,

giving away the bulk of his fortune in ways designed to do the most good as

determined by careful study, experience and the help of expert advisers.

From the time he had begun earning money as a boy, he had been giving a share of his

income to his church and charities. His philanthropy grew out of his early family

training, religious convictions, and financial habits. “I believe it is every man?s religious

duty to get all he can honestly and to give all he can,” he once wrote. During the

1850s, he made regular contributions to the Baptist church, and by the time he was 21,

he was giving not only to his own but to other denominations, as well as to a foreign

Sunday school and an African-American church. Support of religious institutions and

African-American education remained among his foremost philanthropic interests

throughout his life.

THE UNIVERSITY OF CHICAGO

As his wealth grew in the 1870s and 1880s, Rockefeller came to favor a cooperative

and conditional system of giving in which he would agree to supply part of the sum

needed for a particular project if the others interested in it also would provide

substantial financial support. It was on such a conditional basis that Rockefeller

participated in the founding of the University of Chicago. The American Baptist

Education Society had resolved in 1889 to establish a “well-equipped college” in

Chicago. At the urging of the society?s director, the Rev. Frederick T. Gates,

Rockefeller offered to give $600,000 of the first $1 million for endowment, provided the

remaining $400,000 was pledged by others within 90 days. Thus begun, the University

of Chicago was incorporated in 1890, and over the next twenty years Rockefeller

contributed to help build up the institution, always on condition that others should join

in its support. In 1910 he made a farewell gift of $10 million, which brought his total

contributions to the university to about $35 million. In withdrawing from further activity

there, he wrote: “I am acting on an early and permanent conviction that this great

institution, being the property of the people, should be controlled, conducted and

supported by the people.”

CORPORATE PHILANTHROPY

Rockefeller recognized the difficulties of wisely applying great funds to human welfare,

and he helped to define the method of scientific, efficient, corporate philanthropy. The

method was this… To create charitable corporations and give them title to great funds,

whose management and use would be governed by trustees and overseen by officers

with, specialized training and experience. With both the trustees and officers being

dedicated to continuous study of the opportunities for the best uses of the funds under

their care. To help manage his philanthropy, Rockefeller hired the Rev. Frederick T.

Gates, whose work with the American Baptist Education Society and the University of

Chicago inspired Rockefeller?s confidence. With the advice of Gates and, after 1897, his

son, John D. Rockefeller Jr., Rockefeller established a series of institutions that are

important in the history of American philanthropy, science, and medicine and public

health.

THE ROCKEFELLER INSTITUTE FOR MEDICAL RESEARCH

In 1901, he founded the Rockefeller Institute for Medical Research (now The Rockefeller

University) for the purpose of discovering the causes, manner of prevention, and the

cure of disease. From its laboratories have come cures for diseases, and new

knowledge and scientific techniques, which have helped to revolutionize medicine,

biology, biochemistry, biophysics, and other scientific disciplines. A few of the noted

achievements of its scientists are the serum treatment of spinal meningitis and of

pneumonia; knowledge of the cause and manner of infection in infantile paralysis; the

nature of the virus causing epidemic influenza; blood vessel surgery; a treatment for

African sleeping sickness; the first demonstration of the preservation of whole blood for

subsequent transfusion; the first demonstration of how nerve cells flow from the brain

to other areas of the body; the discovery that a virus can cause cancer in fowl;

peptide synthesis; and identification of DNA as the crucial genetic material.

THE GENERAL EDUCATION BOARD (1902-1965)

In 1902, Rockefeller established the General Education Board (GEB) for the “promotion

of education within the United States of America without the distinction of race, sex or

creed?. Between 1902 and its dissolution in 1965, the GEB distributed $325 million for

the improvement of education at all levels, with emphasis upon higher education,

including medical schools. In the South, where there was special need, the GEB helped

schools for both white and African-American students. In addition, out of the Board?s

work with children?s clubs in farm arena grew the 4-H Club movement and the federal

programs of farm and home extension.

ROCKEFELLER SANITARY COMMISSION (1909-1915)

In Rockefeller combined his special interest in the South and his interest in public health

with the creation of the Rockefeller Sanitary Commission for the Eradication of

Hookworm Disease. Its purpose was “to bring about a cooperative movement of the

medical profession, public health officials, boards of trade, churches, schools, the

press, and other agencies for the cure and prevention of hookworm disease,” which

was especially devastating in the South. From its headquarters in Washington, D.C.,

the Sanitary Commission launched a massive campaign of public education and

medication in eleven Southern states. It paid the salaries of field personnel, who were

appointed jointly by the states and the Commission, and sponsored public education

campaigns and the treatment of infected persons. As part of this program, more than

25,000 public meetings were attended by more than 2 million people who were given

the facts about hookworm and its prevention. So successful was its work that a new

agency was created as part of a new Rockefeller philanthropy to expand the work to

other countries and to attack other diseases both in the South and abroad.

THE ROCKEFELLER FOUNDATION

In 1913, Rockefeller established The Rockefeller Foundation (RF) to “promote the

well-being of mankind throughout the world?. In keeping with this broad commitment,

the Foundation through the years has given important assistance to public health,

medical education, increasing food production, scientific advancement, social research,

the arts, and other fields all over the world.

The Foundation?s International Health Division expanded the work of the Sanitary

Commission worldwide, working against various diseases in fifty-two countries on six

continents and twenty-nine islands, bringing international recognition of the need for

public health and environmental sanitation. Its early field research on hookworm,

malaria, and yellow fever provided the basic techniques to control these diseases and

established the pattern of modern public health services. Th RF built and endowed the

world’s first School of Hygiene and Public Health, at The Johns Hopkins University, and

then spent over $25 million in developing public health schools in the U.S. and in

twenty-one foreign countries. Its agricultural development program in Mexico led to

what has been called the Green Revolution in the advancement of food production

around the world; and the RF provided significant funding for the International Rice

Research Institute in the Philippines. Thousands of scientists and scholars from all over

the world have received RF fellowships and scholarships for advanced study. The

foundation helped to found the Social Science Research Council and has provided

significant support for such organizations as the National Bureau of Economic Research,

the Brookings Institution, the Council on Foreign Relations, and Russian Institute at

Columbia University. In the arts the RF has helped establish or support the Stratford

Shakespearean Festival in Ontario, Canada, and the American Shakespeare Festival in

Stratford, Connecticut; Arena Stage in Washington, D.C.; Karamu House in Cleveland;

and Lincoln Center for the Performing Arts in New York.

OTHER ROCKEFELLER PHILANTHROPIC SUPPORT

In addition to creating these corporate philanthropies, Rockefeller continued to make

personal donations. Among others whose activities received his financial support were

various colleges and universities, including Yale, Harvard, Columbia, Brown, Spelman,

Bryn Mawr, Wellesley, and Vassar; theological schools; the Palisades Interstate Park

Commission; San Francisco Earthquake victims; the Anti-Saloon League; Rockefeller

Park and other parks in Cleveland; Baptist missionary organiz