History of the Standard Oil Company Analysis

Analyzing Ida Tarbell’s History of the Standard Oil Company Instructions: For this activity, read each section of Ida Tarbell’s book. 1. Summarize each section and answer the follow-up questions for each section. Finish BOTH the summary and follow-up questions for a section BEFORE moving on to the next section. 2. Respond to the prompt on the last page with a short essay. Make sure to use SIX pieces of evidence and to go back and underline the parts of Tarbell’s writing that you are using for evidence. Summary Follow-up Questions Original Text Ida Tarbell’s History of the Standard Oil Company (1904) Very often people who admit the facts, who are willing to see that Mr. Rockefeller has employed force and fraud to secure his ends, justify him by declaring, "It's business." That is, "it's business" has to come to be a legitimate excuse for hard dealing, sly tricks, special privileges. It is a common enough thing to hear men arguing that the ordinary laws of morality do not apply in business. Now, if the Standard Oil Company were the only concern in the country guilty of the practices which have given it monopolistic power, this story never would have been written. Were it alone in these methods, public scorn would long ago have made short work of the Standard Oil Company. But it is simply the most conspicuous type of what can be done by these practices. The methods it employs with such acumen, persistency, and secrecy are employed by all sorts of business men, from corner grocers up to bankers. If exposed, they are excused on the ground that this is business…. One of the most depressing features of the ethical side of the matter is that instead of such methods arousing contempt they are more or less openly admired. And this is logical. Canonize (make holy) "business success," and men who make a success like that of the Standard Oil Trust become national heroes! People are willing to admit that Rockefeller employed force and fraud to secure his “business”. Rockefeller uses sly tricks to get his way and Tarbell mentions that it is common for men to argue about morality but they don’t apply it to business. Evaluate Tarbell’s judgement of the relationship between business and morality. Tarbell believes business and morality are linked and connot be separated. One cannot say“It’s business” and be excused of wrongdoing The Standard Oil Company had monopolistic power but without it being that, the article wouldn’t have been written. Do you agree or disagree that business corruption was a problem during the Gilded Age? Explain your answer. I agree because of monopolistic powers and the people that lead over them controlled the wealth and had a huge influence over the government even if they were not a part of it. Ethical side of the matter is that it doesn’t arouse contempt but it makes them admirable and it depresses her. Evaluate Tarbell’s judgement of the relationship between business and religion. Tarbell believes the use of religion as an excuse for monopolistic companies is depressing. She believes it helps make heroes out of corrupt men. …The success which Mr. Rockefeller had in getting the refiners of the country under his control, and the methods he took to do it, we have traced. …It will be recalled that… in 1875, he put a second association into operation, which in a year claimed a control of ninety percent of the refining power of the country, and in less than four years controlled ninetyfive percent. This large percentage Mr. Rockefeller has not been able to keep, but from 1879 to the present day there has not been a time when he has not controlled over eighty per cent. of the oil manufacturing of the country. Today he controls about eighty-three per cent. Now it is generally conceded that the man or men who control over seventy percent of a commodity control its price within limits, very strict limits, too, such is the force of economic laws. In the case of the Standard Oil Company the control is so complete that the price of oil, both crude and refined, is actually issued from its headquarters. …let us see what Mr. Rockefeller and his colleagues have been able to do from 1872 to 1904 with their power over the price of oil. The first association which worked was brought about late in 1872. What happened? Prices for refined oil were run up from 23 cents a gallon in June to 27 cents a gallon in November, and the margin increased from 13.6 cents to 17.7 cents. From a profit of about 11/2 cents a gallon they rose to one of over 4 cents. Rockefeller created a second company which monopolized the refining industry to maintain his complete control of the oil industry. Is it right or wrong that Rockefeller was able to create a monopoly? Explain. It was wrong because it completely eliminates competition and prevents anyone else from succeeding in the oil industry. Because of the elimination of competition, Rockefeller’s company was able to raise prices on consumers. Do Tarbell’s statistics justify her anti-monopoly attitude? They justify an anti-monopoly stance because they highlight how corrupt a monopoly can be and the damage it can do to consumers. The history of its organization is studied as a practical lesson in moneymaking. It is the most startling feature of the case to one who would like to feel that it is possible to be a commercial people and yet a race of gentlemen. Of course, such practices exclude men by all the codes from the rank of gentlemen, just as such practices would exclude men from the sporting world or athletic field. There Tarbell believes it isn’t possible to stack the odds in your favor in business then present as a gentleman. Basically, Rockefeller is a bad man. Evaluate Tarbell’s comparison of Standard Oil to games/sports. The comparison illustrates how the unfairness of monopolies is like cheating in a game. Is it right or wrong if Rockefeller used unethical, but legal, methods to create a monopoly? Explain. It is wrong because ethical business is an important for maintaining a healthy capitalist society. is no gaming table in the world where loaded dice are tolerated, no athletic field where men must not start fair. Yet Mr. Rockefeller has systematically played with loaded dice, and it is doubtful if there has ever been a time since 1872 when he has run a race with a competitor and started fair. Business played in this way loses all its sportsmanlike qualities. It is fit only for tricksters. The effects on the very men who fight these methods on the ground that they are ethically wrong are deplorable. Brought into competition with the trust, badgered, foiled, spied upon, they come to feel as if anything is fair when the Standard is the opponent. The bitterness against the Standard Oil Company in many parts of Pennsylvania and Ohio is such that a verdict from a jury on the merits of the evidence is almost impossible! A case in point occurred a few years ago in the Bradford field. An oil producer was discovered stealing oil from the National Transit Company. He had tapped the main line and for at least two years had run a small but steady stream of Standard oil into his private tank. Finally, the thieving pipe was discovered, and the owner of it, after acknowledging his guilt, was brought to trial. The jury gave a verdict of Not guilty!... Anyway it was the Standard Oil Company and it deserved to be stolen from! The writer has frequently heard men, whose own business was conducted with scrupulous fairness, say in cases of similar stealing that they would never condemn a man who stole from the Standard!... And what are we going to do about it? …As for the ethical side, there is no cure but in an increasing scorn of unfair play — an increasing sense that a thing won by breaking the rules of the game is not worth the winning. When the business man who fights to secure special privileges, to crowd his competitor off the track by other than It describes how the Standard Oil Company even controls the court so in a way they have legal immunity and aren’t being held accountable. If one business is successful using unethical practices, does that justify other businesses that are trying to compete with it? Explain. I think though its wrong you kind of have to kind of like the saying “If you can’t beat em, join em”. Evaluate the jury’s ruling. The Jury rules in favor of the Standard because they hold power over the people on the jury. Ida is saying that someone who stole from the Standard is not really stealing because it’s like stealing from a thief. Tarbell is trying to say what good is a winner if they cheat and the winner, she is talking about is the oil company because they exploit the rules to have a competitive advantage. Evaluate the notion that one can steal from a business that has behaved unethically. I think that it’s okay if you steal money from an unethical company because as it seems like it wasn’t their money to begin with. Do you believe ethical standards should be different for businesses? Explain. I think it should be different for companies because say they just go around unethically bullying smaller companies then that is not right. fair competitive methods, receives the same summary disdainful ostracism by his fellows that the doctor or lawyer who is "unprofessional," the athlete who abuses the rules, receives, we shall have gone a long way toward making commerce a fit pursuit for our young men…. Short Essay Question (answer in the space below): To what degree do you agree or disagree with Tarbell’s negative assessment of Standard Oil? Give at least SIX pieces of evidence from the writing. UNDERLINE AND NUMBER the six parts of the letter you are using as evidence. Although there is an evident bias in Tarbell’s assessment, most of her points are valid and her concerns legitimate. Rockefeller’s company used malicious practices to obtain ninety-five percent of the country’s refining power and eighty-three percent of its oil manufacturing. The Standard Oil Company controlled so much of the industry that oftentimes oil prices were set form its headquarters, eliminating competition. What’s more, they even exerted their power over the judicial system intimidating juries and pressuring legal decisions. They had so much power it seeped into the culture making being a successful businessman a semiholy goal in an attempt to coerce the population into tolerating the company’s unethical behavior. This complete control and cultural power ruins a free market and capitalist system. A monopoly of this kind harms society, raises prices, and prevents class mobilization. The company became so bad that people felt justified in illegal activities to harm the company. These facts justify the disdain for the Standard Oil Company held by Ida Tarbell. Tarbell’s bias is inconsequential due to the sheer amount of unethical activities legitimizing her contempt for the Standard Oil Company.