Evening journal., 1905-03-18


admirable had been the selection OF the
location OF its refining plants that it
was able to throw business OF traffic to
the three principal railroad systems
traversing the territory between New
York and Chicago.
In 1874, for example, It has develop
ed that As per cent Of the Standards
business was given to the Pennsylva-
MIA. 80 per cent TO the Erie and 25 per
cent to the New York Central. By
playing each railroad against the other
the Standard company was able to re-
ceive very low rates on its freight
II had the largest tonnage from the
oil districts, and the railroads were
anxious to obtain It. The rebate sys-
tenn was In the height Of its develop
ment, and the Standard company was
able to obtain the lowest rate.
In the numerous Investigations II
has been brought out that by the wise
use Of It's capital 1t not only obtained
new products, but 1t manufactured
them at the lowest cost BY the com
bination idea the methods Of refining
which had been developed to perfec-
tion In one OF two plants were applied
to the entire list OF plants controlled.
BY its ready supplies Of money. its
officials argue, its materials were OBJ
tanned at the lowest possible price.
These same Investigations have
shown that by the application Of strict
business principles the cost Of refining
and manufacturing has been cut in
two. Testimony has shown that the
Standard OIL company is in touch ev-
cry instant Of the day with every quar-
ter of the globe. A balance sheet is
struck every business morning at 3
o'clock.
The Office in New York has been
stated to be a veritable nerve center,
with branches extending to all the i'm
portant cities Of the globe. Bach day
reports are received by cable telling
Of the amount Of oil sold in all lead
ing countries Of the world. The COM
pany now owns its own pipe line, its
tank cars and its tank wagons. The
producer of refined oil has been
brought in close contact with the con-
sumer. There is only one step between
the producer and the consumer; that Is
the retailer.
From the mass Of reports and testi-
mony OF prior Investigations one can
compile a list OF middlemen which the
Standard company has eliminated. In
stead Of paying freight rates to the
railroads on the vast quantities OF
crude oil transported 1t has its own
pipe lines and it's own tank cars, on
which it saves freight rates.
It has its own warehouses In the prin-
cipal distributing cities OF the world.
It employs it's own inspectors; 1t has
its own ships; it has unlimited capital.
What has the individual operator 10
contend with in order to compete with
the Standard company in foreign coun-
tries? First come the railroad freight
rates; then the warehouses in New
York and Bremen, for example, charge
their storage fees. The merchant or
banker abroad adds to the cost. In
! numerous instances there is a broker
here or a broker abroad who acts for
the banker. There IS the ship which
carries It across the ocean, the ship
broker, the interior shipments abroad
and the profits to the merchants who
rehandle It.
1t has been estimated that there are
nineteen distinct classes of middlemer
who exact a profit between the produ'
Ger and the consumer. With the excep-
ton Of one OF these, the Standard com
pany, by its development In all lines
has succeeded in eliminating all The
various steps pay tribute or profit tc
the central company. In addition, all
branches OF industry touching on thS
manufacture and distribution of OF
have been explored and developed.
The independent who finds himself
compelled to buy tin boxes or wooden
boxes for his product necessarily pays
a small profit to those who furnish hin
with the goods. Not so with the Stand
ard company. II has its own com
panies which make the tin cans anC
boxes; 1t has its own lumber lands; Il
buys timber on the stump; It makes it'
own sulphuric acid; It makes every
thing which enters into the refining o.
OIL ano winch Is neeueu IN lls mhrhet
ing; it has unlimited capital and 4
pays less interest rates.
Under these circumstances this colos
: sal corporation has grown and thrivet
{ notwithstanding the attacks made from
time TO time. In some countries it hal
: not been allowed to operate. The ques
ton which confronts its management
is whether the American government
will take steps TO curb its power.