The Grand Acquisitor


The problem was solved by one of Rockefeller’s most astute lieutenants—Samuel Dodd, a round little butter-ball of a man with an extraordinarily clear-sighted legal mind and an unusually high and strict sense of personal integrity. Because he believed that he could render the best advice to the Standard if he was above any suspicion of personal aggrandizement, he repeatedly refused Rockefeller’s offers to make him a director or to buy for him stock which would have made him a multimillionaire.

The sword which Dodd apI plied to the Gordian knot of interstate control was the device of the trust. In brief, he proposed a single group of nine trustees, with headquarters in New York, who would hold “in trust” the certificates of all Standard’s operating companies, including the major company in Ohio itself. In 1882 the Standard Oil Trust was formally established, with John and his brother William Rockefeller, Flagler, Payne, Bostwick, John D. Archbold, Charles Pratt, William G. Warden, and Benjamin Brewster as trustees. (Sam Andrews had sold the last of his stock to Rockefeller four years before, saying the business had grown too big.) In fact, though not in law, one enormous interstate corporation had been created.

Few people even at this time appreciated quite how great the company was. By the i88o’s the Standard was the largest and richest of all American manufacturing organizations. It had eighty-five per cent of a business which took the output of 20,000 wells and which employed 100,000 people. And all this before the advent of the automobile. The colossus of the Standard was built not on the internal combustion engine but on the kerosene lamp.

With the creation of the Trust the center of gravity of the concern moved to New York. Rockefeller himself bought a $600,000 brownstone on West Fifty-fourth Street, where the round of teas and dinners for temperance workers, church people, and Standard executives soon went on. The Trust itself occupied No. 26 Broadway, an eleven-story “skyscraper” with gay striped awnings shading its large windows. It was soon known as the most famous business address in the world. There Rockefeller appeared daily, usually in high silk hat, long coat, and gloves—the accepted costume for the big business executive of the time.

At 26 Broadway Rockefeller was the commanding figure. But his exercise of command, like his personality, was notable for its lack of color, dash, and verve. Inquiring now of this one, now of that, what he thought of such and such a situation, putting his questions methodically and politely in carefully chosen words, never arguing, never raising his voice, Rockefeller seemed to govern his empire like a disembodied intelligence. He could be, as always, a stickler for detail; an accountant recalls him suddenly materializing one day, and with a polite “Permit me,” turning over the ledger sheets, all the while murmuring, “Very well kept, very indeed,” until he stopped at one page: “A little error here; will you correct it?” But he could also be decisive and absolutely determined. “He saw strategic points like a Napoleon, and he swooped down on them with the suddenness of a Napoleon,” wrote Ida Tarbell. Yet even that gives too much of the impression of dash and daring. She was closer to the mark when she wrote: “If one attempts to analyse what may be called the legitimate greatness of Mr. Rockefeller’s creation in distinction to its illegitimate greatness, he will find at the foundation the fact that it is as perfectly centralized as the Catholic Church or the Napoleonic government.” It was true. By 1886 the Standard had evolved a system of committees, acting in advisory roles to the active management, which permitted an incalculably complex system to function with extraordinary ease. It is virtually the same system that is used today. Rockefeller had created the great Trust on which the eyes of the whole world were fastened, but behind the Trust, sustaining it, operating it, maintaining it, he had created an even greater Organization.

“It’s many a day since I troubled you with a letter,” wrote William Warden, a onetime independent Cleveland refiner who had been bought out and was now a trustee and major official in the Standard, “and I would not do so now could I justify myself in being silent. … We have met with a success unparalleled in commercial history, our name is known all over the world, and our public character is not one to be envied. We are quoted as representative of all that is evil, hard hearted, oppressive, cruel (we think unjustly), but men look askance at us, we are pointed at with contempt, and while some good men flatter us, it’s only for our money … This is not pleasant to write, for I had longed for an honored position in commercial life. None of us would choose such a reputation; we all desire a place in the honor & affection of honorable men.”

It was a cry of anguish, but it was amply justified. By the 1880’s the Standard was not only widely known—it was notorious. In part its increasingly bad business reputation originated in the business community itself. Stories began to circulate of the unfair advantage taken by the colossus when it bid for smaller properties: the case of the Widow Backus, whose deceased husband’s refinery was supposedly bought for a pittance, was much talked about. Many of these tales—the Backus case in particular—were simply untrue. But as the Standard grew in size and visibility, other business practices came to light which were true, and which were hardly calculated to gain friends for the company.