Webisode 9. Segment 4
Rich As Rockerfeller
Where did the great tycoons of the Gilded Age get all their money? Carnegie's came from steel. For others, like the Vanderbilts, it was the railroads. For still others, it was oil. In 1858, a small-time prospector named Edwin Drake sank a hole into the ground near Titusville, Pennsylvania. Black slimeoilsoon filled the hole. When the news got out, people raced for the hills and gullies of western Pennsylvania. Before long that state was a wild placea little like California in the gold rush a decade earlier. One day, a quiet young bookkeeper was sent to this disorganized area to see what was going on. "Is oil worth investing in?" His employers had sent him to find out. "No," he told them, and then went on to invest in it himself and to become one of the most successful businessmen the world has known. His name was John Davison Rockefeller.
Some say John D. Rockefeller was the greatest capitalist who ever lived. Others say he almost destroyed capitalism for everyone else. One thing is certain. He soon brought order to that disorderly oil business. In 1863he was twenty-fourhe and a partner bought a small refinery. With his efficient methods, it grew large. Rockefeller began buying competitors.
If you have raw material to sell, two costs are important: the cost of the oil and the cost of transporting it to buyers. Because he was such a powerful oilman, Rockefeller could get the railroads to give him special prices to ship his oil. Actually what they did was give him back half of what he paid for transportation. And part of what others paid as well. They were called kickbacks, and they weren't fair to his competitors. Soon he had put most of them out of business. His company, Standard Oil , became spectacularly rich.
John D. saw his competitors as buds to be nipped. "The American Beauty Rose can be produced in all its splendor only by sacrificing the early buds that grow up around it," he said. Rockefeller wasn't very popular with most Americans. Often he behaved as if he were a king. Crusading journalists called him a "robber baron."
But there were two sides to Rockefeller, and they were both exemplified right beside his bed. That was where he kept his safe, filled with money. But on top of that safe was his Bible. The Bible inspired him to be generous. He gave away vast sums. He once said, "I believe power to make money is a gift from God. I believe it is my duty to make money and still more money, and to use the money I make for the good of my fellow man according to the dictates of my conscience."
For the last forty years of his long life, Rockefeller spent much of his time giving away his money. Always orderly and precise, he gave away precisely half of his fortunehalf a billion dollarswhich went to create the University of Chicago , the Rockefeller Institute for Medical Research, and a foundation that exists just to give money to worthwhile causes.
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