The Barre daily times. (Barre, Vt.) 1897-1959, 1903-12-30
ROCKEFELLER'S
REBATE SYSTEM
Miss Tarbell Says 1t Made the
Standard Oil Trust.
RELATION WITH RAnwAYssHowE

AALAAaANAAAMAE 1AANAAfAN- - ~
of Monopolistfc Combination In
which n war of individuals on
the Rebate system Ia Depicted.
How the oil Magnate Freed Him
self From the Railroads.
The following is an extract from
Miss TarbeIps History Of the Stand
ard Oh Company" in McClure's for
December:
General Butler knew something Of
the oil business. -Four years before he
had been employed by the Pennsylva-
MIA Transportation company to take
care OF the legal side of their great I'M
dertaking-a seaboard pipe line-and
he had had a convincing experience
OF the Standards power. He reviewed
the history OF the oil business, making
q few minor mistakes in his historical
facts, but never missing the big facts
and leaving no doubt at all about his
opinion OF the Standard Oil company.
He presented the committee with a
pretty full collection Of embarrassing
testimony, calling particular attention
to Mr.. Cassatts revelations In 1877,
and demanded an investigation. he
had no backing in the oil regions, how
ever. and his appeal was the last made
to congress from the oil regions.
The situation was saved at this crit
zeal time by individuals scattered
through the oil world who were re-
solved to test the validity Of Mr.. Rookie
feller's claim that the coal oil business
belonged to him. Eve have a right to
do an independent business they said.
"and we propose to do it," They began
this effort by an attack on the weak
spot in Mr.. RockefeIler's armor.
The ten years just passed had
taught them that the realization Of
Mr.. Rockefeller's great purpose had
been made possible by his remarkable
manipulation of the railroads It was
the rebate which had made the Stand
ard Oil trust, the rebate, amplified.
systematized glorified into a power
never equaled before or since by any
business Of the country. The rebate
had made the trust, and the rebate, in
spite of ten years Of combination, pc
troleum associations, producers IN
ions, resolutions, suits ID equity, suits
in quo warranto, appeals TO congress,
legislative Investigations 1.-The rebate
bill was Mr.. Rockefellers most eff
fective weapon IL they could wresl
it from his hand they could do bust
ness. They had learned something
else in this period--th the railroads
feared exposure Of discrimination ane
could be made TO settle rather thar
have their practices made public. This
much the hated compromise Of lSSs
had demonstrated Therefore, sale
these individuals, we propose to sn'
for rebates and collect charges unit
we make it so harassing and danger
GUS for the railroads that they will
, shut down on Mr.. Rockefeller.
The case OF Scofield, Shurmer and
. Teagle, which was before the public
constantly during the six or sever
! years following the breaking up Of tn,
/. Producers union, in which the oil re
rions presented no united front to Mr.
Rockefeller, served to keep public atten
. ton ON the ruinous effect Of the rebate
! and TO strengthen the feeling that dras
! tic legislation must be taken If Mr.
RoekefeIler's exploit was to be pre-
vented In other industries.
: Another case came out in this war o
/ individuals on the rebate system, whicl
! heightened the popular indignation
against the Standard. 1t was a cas-
4 showing that the Standard Oil com
! pany had not yet abandoned tina
unique feature Of its railroad contract
! by which a portion Of the money whicl
other people paid for their freight wa
: handed over to them. This peculiar de
I velopment of the rebate system seem
!. to have belonged exclusively to MI
Rockefeller, Indeed careful search O
all the tremendous mass of material
: which the various investigations o
3 railroads have produced shows no othe
. case, so far as the writer knows, of thi
II practice. 1t was the clause of the Sout
. improvement contracts which provoke
. the greatest outcry 1t was the featur
/. Of Mr.. Cassatt's revelations in 1877
which dumfounded the public an
y which no one would believe until the
Y saw the actual agreements Mr.. Cassai
IN presented
sr The oil regions as whole did nc
a hesitate TO say that they believed thi
II practice was still IN operation, but ma
H. urally proof was most difficult to 81
/. cure. The demonstration came in 1ss
IA through one of the most aggressive an
= violent independents which the war
oil has produced, Mr.. George Rice
II Marietta, o. Mr. Rice, an oil produce
a had built a refinery at Marietta
Sc 1873. He sold his oil in the state, Il
q west and south. six years later b
business was practically stopped by
u sudden rise in rates on the Ohio road
in an advance OF fully 100 per cent beir
Or made on freights from Marietta, whe
IF. there were several independent refine
les, although no similar advance Wi
made from Wheeling and Clevelan
ID where the Standard refinerles were
re Gated These determinations were full
v. shown in an investigation hy the Oh
be- state legislature IN 1879 From th
" time on Mr. Rice was in constant diff
ty Guilty about rates
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