Standard Oil Trust

“ They have become a strong organisation almost solely because of the persistent opposition of the Standard Oil Trust. The Standard's efforts to break up the Producers' Protective Association by buying out the biggest producers precipitated a co-operative company for handling oil. ”

“ I will select one or two, particularly the great Standard Oil Trust and the Cotton-seed Oil Trust.
The Standard Oil Trust is probably the largest single business monopoly in the world, the value of all its included interests being estimated, according to the evidence submitted, at £29,600,000. In the report it is described as “one of the most active and possibly the most formidable monied power on this continent. Its influence reaches into every State, and is felt in remote villages; and the products of its refineries seek a market in almost every seaport on the globe.” ”

“ It is when one examines the inside of the Standard Oil Trust that one sees how much reason there is for the opinion of those people who declare that Mr. Rockefeller can always sustain the monopoly of the oil business he has achieved. ”

“ With the removal of danger of any competition by the Pennsylvania Railroad, the transportation department of the Standard Oil Trust seems to have been as nearly a perfect machine, both in efficiency and in its monopolistic power, as ever has been devised. It was more perfect, indeed, than the refining end of the trust, for independent refiners did exist, and since 1880 they had been showing increasing vigour, whereas there seemed now no opportunity for an independent pipe-line ever again to develop. Who, with the Tidewater's story in mind, would be bold enough to attempt to reach the sea? ”

“ The increasing competition in Western Europe of independent American oils, and the rapid rise since 1895, particularly of Russian oil, are what has kept this margin down. It is doubtful, such is the growing strength of these various competitive forces, if the Standard Oil Trust will ever be able to put up the margin on export oils. If there were only the American independents to reckon with, a compromise might be possible, but Russia, Burmah and Sumatra are all in the game. ”

“ Its membership was composed entirely of persons outside of and opposed to the Standard Oil Trust, one of its by-laws reading: "No person connected with the Standard Oil Company or any of its allies, as partners, stockholders, or employees, and friendly thereto, shall be elected to membership; and members becoming such shall be liable to expulsion." (3) It proposed "to defend the industry against the aggregations of monopolistic transporters, refiners, buyers and sellers" by handling its own oil. ”

“ It is the most perfectly developed trust in existence; that is, it satisfies most nearly the trust ideal of entire control of the commodity in which it deals. Its vast profits have led its officers into various allied interests, such as railroads, shipping, gas, copper, iron, steel, as well as into banks and trust companies, and to the acquiring and solidifying of these interests it has applied the methods used in building up the Oil Trust. ”

“ Canonise "business success," and men who make a success like that of the Standard Oil Trust become national heroes! The history of its organisation is studied as a practical lesson in money-making. 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. ”

“ The world has been taught to believe that the owners of Standard Oil regard the shares of the great oil corporation as their most precious, most sacred possessions. Yet while "Standard Oil" has been so scientifically spreading abroad the impression that the public would never be permitted to own Standard Oil stock, secretly it has been engaged in exchanging that [43] stock for the securities of the people in the form of banks and trust companies, railroads, and other assets of definite value. ”

“ The legislation proposed was directed against "combinations to fix the price or regulate the production of merchandise or commerce." Now a mass of testimony had been presented showing that, from the starting-point of the Standard's history with the South Improvement Company, its aim has been to regulate the output of refined oil so as to fix the price, but this testimony, the committee saw clearly enough, did not apply to the trust which it was investigating. ”

“ It is probable that certain branches of the iron and steel trade were the next to be combined by means of a trust, but as these were arrangements between private firms, not much information as to the time of their origin has reached the public. The second great trust to attract general public attention was the American Cotton Oil Trust, in which some of the same men who have so successfully engineered the Standard Oil combination are heavily interested. ”

“ No proofs were made of its rapacity or of the greed with which it lays hold of every competitive industry, except such as might be drawn from the fact that it is the almost sole occupant of the field of oil operations, from which it has driven nearly every competitor. ”

“ How low will they force the price of crude?
How high refined?
Will they adopt a liberal policy for producers, or will they destroy their interests and crush out the oil production entirely ? Will they be liberal with dealers and consumers and adopt uniform rules with steady prices, or will they take advantage of times and circumstances and force ruinous corners upon the trade? ”

“ The low price for crude which these vast stocks caused, the high charges for gathering, transporting and storing, all services out of which the Standard was making big profits, the fact that the profit on refined oil steadily increased in these years—the result of the overthrow of independent refiners and pipe-lines—while the profit on crude steadily diminished, were facts which the oil producers brooded over incessantly, and the more bitterly because they felt they could do nothing to help themselves. ”

“ Unless the producers will co-operate with us, first, by limiting the production or the capacity of the markets of the world to absorb petroleum at a good price; and, secondly, by tanking a large part of the production for the next two or three months, that it may be withheld from the market until the present glut is exhausted and production reduced, it will be impossible, I am convinced from recent advices of the state of supply and demand in the principal markets of the world, to keep the price of crude oil up to $3.50, and of refined oil up to twenty-two cents, during the coming summer. ”

“ But I also want to work with this Congress to encourage the research and technology that helps natural gas burn even cleaner and protects our air and water.
Indeed, much of our new-found energy is drawn from lands and waters that we, the public, own together. So tonight, I propose we use some of our oil and gas revenues to fund an Energy Security Trust that will drive new research and technology to shift our cars and trucks off oil for good. ”

“ This giant creature, "Standard Oil," can best be described so that the average man may understand it as a group of money-owners—some individuals and some corporations—who have a right to use the name "Standard Oil" in any business undertakings they engage in. The right to use the name is of priceless value, for it carries with it "assured success."
Standard Oil, the seller of oil to the people, transacts its business as does any other corporation. ”

“ An organisation to protect the oil capital is imperatively needed. Oil to yield a fair profit should be sold for twenty-five cents per gallon. That price would protect every interest and cover every outlay for getting out the crude petroleum, transporting by railroad, refining and the incidental charges of handling, etc. The foreign markets will regulate the price to a great extent, because they are the greatest consumers. The people of China, Germany, and other foreign countries cannot afford to pay high prices. ”

“ The newspapers of the South have contained many items of news indicating that the men who have made the oil markets theirs have similarly appropriated the best of the turpentine trade, but nothing is known through adjudicated testimony. The trustees of oil have always denied that there was any connection between them and the Cotton-seed Oil Trust, although the latter shipped its product in the oil trust's cars. ”

“ For one brief day the financial press of the country printed the item: "Standard Oil came to the rescue by buying for cash large blocks of Standard Oil stock which had long been held by this or that interest for investment," and no more was thought of the incident. Even the most alert financiers never suspected that the most important stock secret of the age had been on the verge of becoming public property.
Planted deep in the minds of the public that watches the comings and goings of the Street is the conviction that Standard Oil is the holy of holies among stocks. ”

“ Then the profits of the trust from the increased prices alone will amount to four and one half million dollars per annum.
There is another way in which trusts directly affect the public, which has received very much less attention than it deserves. Besides the people who use the linseed oil and pay the trust an extra fourteen cents a gallon for the privilege, there are a great number of people who would have used oil if the price had not advanced, but who cannot afford to do so at the advanced price. ”

“ But the only way we’re going to break this cycle of spiking gas prices for good is to shift our cars and trucks off of oil for good. That’s why, in my State of the Union Address, I called on Congress to set up an Energy Security Trust to fund research into new technologies that will help us reach that goal. ”

“ Resolved, that to give a wider market throughout the world to petroleum, to enhance its price and to protect producers from unjust combinations of home refiners, a committee be appointed to ask the representatives of foreign governments at Washington to request their respective governments to put a proper tariff on refined oil and to admit crude oil free into the ports of their respective governments. ”

“ As a matter of fact, the Standard's ability to cut off crude supplies from the outside refiners is much greater than in the days before the Interstate Commerce Bill, when it depended on its alliance with the railroads to prevent its rival getting oil. It goes without saying that this is an absurd power to allow in the hands of any manufacturer of a great necessity of life. It is exactly as if one corporation aiming at manufacturing all the flour of the country owned all but ten per cent. ”

“ That odious combine, which included a number of railroad-officials, oil-operators and refiners, disbanded without producing, refining, buying, selling or transporting a gallon of petroleum. “Politics makes strange bedfellows” and so does business. Among subscribers for South-Improvement stock were certain holders of Standard stock and also their bitterest opponents; among those most active in giving the job its death-blow were prominent members of the Standard Oil-Company. ”

“ Our only hope is in increasing consumption. The world is buying more oil to-day than ever before, because it is cheap. We must learn to accept small profits, as other industries do." "The formation of the Refiners' Association has thrust upon the trade an element of uncertainty that has unsettled all sound views as to the general outlook," said the Derrick. "The scope of the Association," wrote a Pittsburg critic, "is an attempt to control the refining of oil, with the ultimate purpose of advancing its price and reaping a rich harvest in profits. ”

“ The case of petroleum is peculiarly instructive. When it became apparent, in the early years of the present century that oil burning ships, motor vehicles and air craft were bound to play a determining part in the economic life of the immediate future, various interests such as the Shell Transport, Royal Dutch and the Standard Oil, with the open or tacit backing of their respective state departments, entered on a campaign to secure the world's supply of petroleum. ”

“ By thus controlling all the oil, the agency expected to protect the weakest as well as the strongest producer, to equalise the interest of different localities, to prevent refiners and exporters from accumulating stocks, and to prevent gambling in oil. The agency was to take active means to collect reliable information about the oil business—the number of wells drilling, the actual production, the stocks on hand—things which had never been done to anybody's satisfaction. ”

“ I do not believe there is any intention among the oil men to 'bull' the market: The endeavour is to equalise all around and protect the capital invested. If by common consent, in good faith, the refiners agree to reduce the quantities to an allotment for each, made in view of the supply and demand, and the capacity for production, the market can be regulated with a reasonable profit for all. The price of oil to-day is fifteen cents per gallon. The proposed allotment of business would probably advance the price to twenty cents. ”

“ According to this circular the public paid from 25 to 331⁄3 per cent more where there was no competition. The fact that oil is cheaper where there is competition, and also that the public has to pay the cost of the expensive "Oil Wars" which have been carried on so constantly for the last twenty-five years all over the country, is coming to be recognised, especially in the Middle West of this country, by both dealers and communities. ”