Who is the richest man in American history? The world-famous financial magazine "Forbes" has done a related survey. Of course, the survey cannot be determined by the amount of personal wealth at its peak, but by the impact of the US GDP on the US economy at that time. The final answer was John D. Rockefeller, the "oil king." If John D. Rockefeller's wealth is converted into 2006 dollar standards, the figure is more than $200 billion, which is several times higher than Bill Gates' personal assets. Bill Gates also idolized Rockefeller, saying, "I have only one money-making hero in my mind—John D. Rockefeller." ”
To understand the economic history of capitalist economy in the United States, it is inevitable to mention Rockefeller, who is also the most controversial figure in modern business history. On the one hand, the Standard Oil Company founded by Rockefeller monopolized 80% of the oil refining industry and 90% of the pipeline business in the United States at its peak, so some people think that Rockefeller is just an unscrupulous and mercenary capitalist; On the other hand, Rockefeller is deeply Christian, and the foundation that bears his name adheres to the purpose of "benefiting mankind throughout the world", and its total donations are as high as $500 million, so some people have complimented Rockefeller as a generous philanthropist. The long life of the "oil king" has a mixed reputation.
John D. Rockefeller was born on July 8, 1839, in a small town on the Hudson River in New York, United States. The family immigrated to the United States from Germany in the 18th century. His parents have very different personalities: the father is a very practical person, and when educating his children, he instills in them the idea that "you can only be paid for your work"; My mother was a devout Christian who converted to the Bible in every word and deed, and she was diligent and simple. As the eldest son, Rockefeller learned practical business from his father and meticulous, thrifty, trustworthy and meticulous strengths from his mother, which had a great impact on his later success.
Rockefeller showed a talent for business from an early age, and he had a ledger on which he recorded his work in detail to demand payment from his father. At the same time, he saved this money, lent it to local farmers, charged a certain amount of interest, and earned money from it. Once, Rockefeller found a turkey's nest in the woods, took the baby turkey home to raise it, and sold the turkey on Thanksgiving, and Rockefeller made a considerable profit from it.
When Rockefeller was 14, he attended Cleveland Center Middle School. After school, he used to wander around the dock to watch merchants do business. One day, he met a classmate, and the two talked as they walked. The classmate asked, "John, what do you want to do when you grow up?" The young Rockefeller replied without hesitation: "I'm going to be a $100,000 guy and I'm going to make it." ”
After graduating from high school, Rockefeller decided not to go to college and make a living in business. Rockefeller was demanding of his job, and he looked through Cleveland's directory of businesses and carefully searched for well-known companies. He later recalled: "I went to the railroad company, the bank, the wholesaler to find work, and I didn't go to the small shop. I'm going to do big things. Every morning at 8 a.m., Rockefeller left his apartment, dressed in black trousers and a high-collar suit and black tie, to go to a new round of appointments. Despite being turned away many times, Rockefeller was not discouraged. Mr. Rockefeller said he went through the companies on the list and started from scratch, some two or three times, but no one wanted to hire a child. But Rockefeller was the kind of stubborn man, and the more frustrated he was, the stronger his determination became. He went to the interview 6 days a week, and he stuck with it for 6 weeks in a row.
On the morning of September 26, 1855, 16-year-old Rockefeller walked into the Hewitt Tuttle Company, a distributor of agricultural products. He was met by the second boss, Henry B. Tuttle, who needed a bookkeeper and considered putting Rockefeller in the role. After lunch, Rockefeller came to the company again to meet the big boss, Isaac L. Hewitt, and after carefully reading Rockefeller's words, the big boss said, "Stay and try." Rockefeller was ecstatic when he was hired, and the excitement was still fresh even in Rockefeller's retrospect in old age. Since then, September 26 has become Rockefeller's employment day, and he celebrates it as his second birthday.
Rockefeller, who worked as a bookkeeper, immersed himself in the ledger and meticulous in his attitude towards work, recalling: "Since my first job was as a bookkeeper, I learned to respect numbers and facts, no matter how small..." Later, the company put Rockefeller in charge of paying the bills, and he took the work even more cautiously, each time carefully checking, in Rockefeller's own words, "more than spending your own money." Rockefeller couldn't stand the penny of small mistakes, and this responsible and conscientious attitude made the boss very satisfied. In addition, the young Rockefeller not only showed patience and courtesy when collecting rent for Huey's boss, but also showed the indomitable spirit of a bulldog, that is, he would not give up until he received the rent.
In addition to keeping good accounts, Rockefeller often provided ideas for the company's operations. Once, the company bought a batch of marble, opened the package, found that the high-priced marble was defective, and the boss was frustrated but could not do anything. At this time, the nimble Rockefeller suggested that the responsibility be shifted to the three transportation companies responsible for the shipment, and each of the three companies should be asked for damages. This brilliant idea resulted in the firm receiving twice as much compensation as before. Rockefeller's excellent performance was appreciated by his boss, and at the end of 1855, Hewitt paid Rockefeller $50 for the first three months. Shortly thereafter, Hewitt announced that the assistant bookkeeper's salary would rise to $25 a month. Rockefeller recalls, "It was there that I started my career as a businessman with a salary of $5 a week. ”
In 1857, at the age of 17, Rockefeller was promoted to chief bookkeeper, raising his annual income to $600. At this time, Rockefeller began to confidently try some flour, ham and pork business, which, although small, brought him some profit every time.
In 1858, at the age of 19, Rockefeller founded a company dealing in agricultural products at the suggestion of his friend Morris Clark. Rockefeller borrowed $1,000 from his father at 10 percent interest, plus $800 from his savings, and founded his first partnership, Clark-Rockefeller Corporation. The new company was running very well, making $4,000 in business in the first year and $4,000 in net at the end of the second year. In the course of his business, Clark praised Rockefeller's ability to operate, describing the situation at that time: "He was methodical to the extreme, paying attention to details, not missing anything." If there is a penny to give us, he will take it. If he gives the customer a penny less, he also wants the customer to take it. "Rockefeller always did business with confidence, ambition, and at the same time he was true to his word, trying to gain his trust.
On August 28, 1859, oil was discovered in Pennsylvania, and countless people with dreams of making a fortune flocked to it. Although Rockefeller had great enthusiasm for oil, he did not lose his mind and blindly follow the trend. He decided to personally investigate Pennsylvania's crude oil production areas in order to obtain direct and reliable information. In the crude oil producing area, Rockefeller saw a lively scene of derricks. Undeceived by the superficial spectacle of prosperity, the calm Rockefeller saw the potential crisis behind blind mining.
After some time of fieldwork, Rockefeller returned to Cleveland. His final decision on this basis was not to invest in crude oil production, because there were already 72 wells with a daily output of 1,135 barrels, and the demand for oil was very limited, and the oil market would inevitably fall in the event of oversupply, which was the inevitable result of blind exploitation. Sure enough, as Rockefeller expected, "those who play pioneers do not make money." Oil prices plummeted from $20 to a mere 10 cents a barrel due to frenzied mining. Many oilmen lost their fortunes, but Rockefeller avoided losses because of his cool head. Rockefeller cautioned that in order to create a career, you must learn patience. In this impetuous atmosphere, most oil producers want to dry their wells as quickly as possible, rather than building an industry. Rockefeller, on the other hand, remained calm and believed the industry had long-term prospects.
In 1861, the American Civil War broke out. Rockefeller, who did not participate in the war, showed his skills in the business field, and he quickly took out large loans and hoarded a large amount of necessary items for wartime. This brought Rockefeller extremely substantial profits. The war brought much more than that, because railroads were rapidly rising and the demand for oil increased greatly.
On his first trip to Pennsylvania, Rockefeller realized that the results of oil exploration were unpredictable, and refining seemed safe and organized by comparison. It didn't take long for him to establish the belief that refining was the key to getting the most out of the industry. This was inspired by a friend named Samuel Andrews to Rockefeller, who switched from dealing in agricultural products to the oil industry, precisely because Samuel Andrews strongly persuaded him. Andrews, an expert in lighting oils, believes kerosene will be brighter and larger than other sources of light. In search of a patron, Andrews approached Clark and Rockefeller. Rockefeller saw this as a good opportunity, so in 1863, Rockefeller decided to invest in a new oil refining company, Andrews-Clark Company, in Cleveland.
The timid and cautious Clark and the bold and radical Rockefeller had very different personalities, so the two often had serious differences in decision-making. Rockefeller later wrote in his memoirs: "He was very angry because of my loan to expand the refining business, as if it had offended him." The catalyst that eventually led to the two having to part ways was the discovery of an oil field in January 1865 at a site called the Pitthall River. In order to expand the scale, Rockefeller asked Clark to agree to sign an IOU, but Rockefeller got Clark's anger: "We have been borrowing money to develop this oil business, and we have borrowed too much." Rockefeller retorted without budding: "As long as borrowing money can steadily expand the business, we should borrow." Clark tried to scare Rockefeller and threatened to disperse.
The solution to the problem is to auction the company to the highest bidder. The reserve price at auction was $500, but it quickly rose to $50,000, which was more than Rockefeller had envisioned the value of the refinery. It eventually rose to $72,000, and Rockefeller offered $72,500 without hesitation, knowing that it would determine his life. After the auction, Rockefeller exchanged $72,500 for the other half of the agency's shares. The company's name was changed to Rockefeller-Andrews, and at the age of 26, Rockefeller owned Cleveland's largest refinery, capable of refining 500 barrels of crude oil per day, making it one of the largest in the world.
In December 1865, the Rockefeller-Andrews Company opened its second refinery, the Standard Refinery. Four years later, the two plants were named Standard Oil Company in the form of joint shares, registered in Ohio, with Rockefeller as president. Rockefeller then acquired several refineries, ventured into pipeline transportation, and built his own rail network, monopolizing the industry. When Rockefeller first entered the oil industry in 1865, there were 55 refineries in Cleveland, and by 1870, when Standard Oil was founded, only 26 survived, and by the end of 1872, Standard Oil Company controlled 21 of these 26.
In August 1878, Andrews and Rockefeller disagreed over dividends to shareholders. Rockefeller does not tolerate directors who prefer to receive more dividends rather than invest them in reproduction. Andrews threatened to sell the company's shares, and Rockefeller bought his shares for $1 million at his request, and has been in charge of the company since then.
With the rapid development of the oil empire, the danger of tail size gradually revealed, and Rockefeller had a clear understanding of this malad. By chance, Rockefeller read an article in a publicly available publication that read: "The era of small businessmen is over, and the era of big business is coming." This coincided with Rockefeller's thinking, so Rockefeller hired the article's author, Dodd, as legal counsel for a monthly salary of up to $500.
Dodd was a young lawyer who was responsible for finding legal loopholes for Rockefeller's company after joining Rockefeller's company. One day, while carefully studying the trust system in English law, he suddenly had an epiphany and proposed the concept of "trust" as a monopoly.
The so-called "trust" refers to a number of enterprises that produce similar products, no longer working independently, but forming a comprehensive enterprise group in a highly united form. This form is much more monopolistic than the original "cartel", the way in which independent enterprises form a united front in production and sales in order to control the market.
Under the guidance of Dodd's "trust" theory, Rockefeller convened a general meeting of shareholders of the Standard Oil Company on January 20, 1882, and formed a nine-member "Board of Trustees" to govern all Standard Oil Company stocks and the shares of affiliated companies. Rockefeller rightfully became chairman of the committee. Subsequently, the Board of Trustees issued 700,000 trust certificates, and Rockefeller and four others alone owned more than 460,000, accounting for two-thirds of the total. In this way, Rockefeller got his wish and created an unprecedented joint enterprise, the trust.
Under this trust structure, Rockefeller merged more than 40 manufacturers, monopolizing 80% of the country's refining industry and 90% of the pipeline business. Trust quickly spread across the country and in all industries, and in a short period of time, this form of monopoly accounted for 90% of the US economy. It is clear that Rockefeller succeeded in creating a unique era in American history—the era of monopoly.
Although Standard Oil was omnipotent in refining, transportation and sales, until the early 80s of the 19th century, it had only four oil production sites. Twenty-five years after the discovery of oil fields in Pennsylvania, no major oil fields have been discovered in the United States. Therefore, many people doubted the solidity of Rockefeller's oil empire, and some even suggested that Standard Oil withdraw from the oil industry and switch to a more stable industry, but Rockefeller chose to insist.
The turning point came in May 1885. An exploration team was searching for natural gas in the town of Lema in northwestern Ohio when it accidentally drilled a large oil field. However, the fly in the ointment is that there are some difficult problems in the chemical composition of crude oil, which will form a film on the lamp when burned. What's more troublesome is that its sulfide content is too high, which will corrode the machine and emit an unpleasant odor. In order to solve the quality problem, Rockefeller hired a famous German chemist named Hermann Vlahi in July 1886 and asked him to remove the odor from oil.
So there was a dilemma in front of Standard Oil: Should it buy the field immediately, or wait for the test to succeed? Choosing to wait risks missing the opportunity, and the always cautious Rockefeller showed amazing courage and foresight, and he decided to buy the oil field immediately. The decision was unanimously opposed by the board, and Rockefeller showed the determination and courage to fight the battle, offering to invest $3 million of his own and risk it for two years. If successful, the company will return the money to him; If he fails, he bears the risk.
Standard Oil spent millions of dollars to buy the Lema field and lay the pipeline. At that time, this "skunk oil" sold for only 15 cents a barrel, and there was no market, but the company kept it in stock. By 1888, the stock reached more than 40 million barrels. Finally, by October 1887, Vlahi had succeeded in refining kerosene ready for marketing. Standard Oil immediately went all-in on oil production and began a large-scale merger and acquisition in the industry. In 1890 he annexed Union Oil Company and three other major oil producing companies, controlling 300,000 acres of land in Pennsylvania and West Virginia.
In the 80s of the 19th century, Standard Oil Company exercised a global oil monopoly for a long time. In order to open up foreign markets, in 1882, Rockefeller sent people to conduct a two-year overseas market survey, and soon Rockefeller successfully opened the markets of China, Japan, India and other countries with kerosene. However, after the discovery of crude oil in Baku, Russia, a new round of competition began, and the Russians even had ambitions to drive US oil out of the world market.
Fierce competition once again aroused Rockefeller's fighting spirit, and he decided to set up his own overseas agency. In 1988 Standard Oil established its first overseas subsidiary, Anglo American Oil , and soon monopolized the British oil business. In 1890, Standard Oil established the Deutsche Amram in Bremen, which was responsible for the German oil market. In addition, Rockefeller set up an oil transmission station in Rotterdam to supply all the required crude oil to France. Then he bought some shares of Dutch and Italian oil companies and planned a fierce price war in India. Standard Oil also sent the first giant steam tanker with a load of 1 million gallons to Europe.
In order to seize business in Asia, Standard Oil even condescended to sell skewer on behalf of Russia. Soon after, Standard Oil finally set up a series of offices in Asia and sent agents to Shanghai, Kolkata, Mumbai, Yokohama, Kobe and Singapore. By this time, Standard Oil had 100,000 employees, and the oil empire founded by Rockefeller became the largest and richest institution in the world that combined production and commerce. The oil company founded by Rockefeller was renamed several times and finally named Mobil Oil Company.
In 1896, at the age of 57, Rockefeller chose to retire and handed over Standard Oil to his son, John D. Rockefeller Jr. But he retained the largest stake in Standard Oil and could participate in Standard Oil's business decisions.
During his 41-year retirement, he focused primarily on philanthropy. Initially, no one was willing to accept his donation because they thought Rockefeller's money was earned by dirty means and stained with blood. But through Rockefeller's efforts, people slowly believed his sincerity. When a school on the shores of Lake Michigan was facing bankruptcy, Rockefeller immediately donated millions of dollars to bring the school back to life and the University of Chicago it is today. The Rockefeller Medical Research Institute, which was established with a donation of $200,000, became the first medical research center in the United States, and later won 12 Nobel Prizes for outstanding achievements, more than any similar institute.
Since the 90s of the 19th century, Rockefeller has given more than $1 million annually. In 1913, the "Rockefeller Foundation" was established to make donations. He donated a total of $500 million, but he didn't keep up with the pace of making money.
In 1910, Rockefeller's fortune reached $1 billion, making him the first person in U.S. history to own $1 billion.
On May 15, 1911, under the Sherman Antitrust Act of 1890, the U.S. Supreme Court ruled that Mobil was a monopoly. Under this ruling, Mobil Oil was split into 38 regional oil companies. However, despite the Supreme Court ruling and the fact that they were branded unscrupulous monopoly capitalists, investors enthusiastically sought after the shares of these branches, so that the combined market value of many of the companies after the split far exceeded the market value of the original Mobil Oil Company. The Rockefeller family's fortune has not decreased, but more than before.
May 23, 1937: Rockefeller dies at the age of 98. The huge wealth left behind and the oil empire business have been carried on by descendants, and it has now extended to the sixth generation, and the Rockefeller family has become the most prestigious wealth family in the United States. This family has a huge influence on the economy and politics of the United States. The oil empire founded by John D. Rockefeller continued its glory under the management of future generations. Today, the Rockefeller family's oil companies – ExxonMobil, Chevron, BP, Shell and France's Total – are the five largest oil companies in the world.
From a small broker to the overlord of the global oil industry, Rockefeller has become a legend. Rockefeller's entrepreneurial history is representative of the early rich in the United States and is a typical representative of the American dream. He was shrewd and visionary, calm and bold, and his success was no accident, as he himself said: "If I were stripped of nothing and left in the desert, I could rebuild the whole dynasty as soon as a camel caravan passed." ”