The Standard Oil Monopoly In The Late 1800's

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In the late 1800s, industry was following the path of laissez-faire, which was the inactive participation of the government in regulating business. This led to the rise of the idea of social Darwinism being implanted in business, where only the strongest, the wealthiest, would be the survivors. So, big business leaders, such as Carnegie and Rockefeller, included social Darwinism in how they carried out business, which for them, was buying out and ridding of the “weaker” competition. Even though the big business leaders later participated in philanthropy, their goal in business was to hold a monopoly, which is the total control of production of a product. One business that had total control over a certain product in the late 1800s was the Standard …show more content…
Those who supported the monopoly saw the positives in a monopoly, which were stated by John D. Rockefeller in Random Reminiscences of Men and Events. Rockefeller stated that Standard Oil was positively influencing stocks, as it was “held by an increasing number of small holders [all over] the country”. This, however, was not positive for same product company owners and consumers. Monopolies had an overall hold on the wealth available in the country, and due to monopolies large influence on business, the “bulk of the nation’s aggregate wealth” was only owned by “less than five hundred persons” (Klein). The rest of the nation was left with little of the nation’s wealth. Then, a protestor to monopolies, as well as Standard Oil, was Ida Tarbell. She stated that in business, the excuse of “it’s business” became a “legitimate excuse for hard dealing, sly tricks, [and] special privileges” (Tarbell). Other companies had little to no chance due to companies that were “cheating” by buying out other companies and lowering their prices to drive competition out of business. Since businesses had methods to rid of competition and their company leaders often held most of the nation’s wealth, it is definitely in the best interest for the government to break up Standard …show more content…
The effect of their monopoly put companies producing oil out of business through various ways. One way the Standard Oil was putting other companies out of business was by lowering the prices of their oil until the other companies could not compete. A competitor to Standard Oil complained in 1899 to the government that they had been “in [an] absolutely vain endeavor to get equal and just freight rates with the Standard Oil Trust”, but failed since they could not “run [their] refinery at anything approaching a profit” (“An Oil Man Goes Bankrupt”). Due to this, companies went out of business left and right, and the availability of oil from other companies became smaller and smaller. Consumers, then, had no choice but to purchase oil from the Standard Oil Trust, no matter how high they raised their prices after the competition was gone. In addition, businesses associated with Standard Oil, such as transport, were threatened by rebates. If a company did not pay the rebate to Standard Oil, they were risking losing their connection with the company and having to shut down themselves. The overall impact of Standard Oil was negative for American business due to the lack of variety in companies to choose from when purchasing
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