Evening star., 1938-01-09
BY W. b. RAGSDALE.
Associated Press Stan Writer.

early in this century.
BY ". b. RAGSDALE,
Associated Press Stan Writer,
The year that George Washington
was elected, America had Just "a
corporations. all small. 1t had vast
number OF them when Leon F.. Czol-
goss changed his mind about killing
. priest and shot President Mckinley.
But despite the wide difference in
numbers between the times of Wash
ington and Mckinley, fewer than 80
corporations were credited with con-
trolling virtually all of the Nations
business at the turn OF the nineteenth
century
How that came about and what has
been done toward breaking that con-
troll since has furnished much material
Tor argument in the past; promises to
be heard much in the present session
Of Congress.
The country had started off with
rocks and rills, woods and tempted
hills. Minerals were taken from the
rocks. The rills were turned into
power and water for cities. Swinging
axes changed the woods into lumber,
oil drills and the clamor of factories
broke the solemn silence of the hills.
Got Land for Song.
In the westward expansion, mineral
and timber barons got Government
land for a song, sometimes just for a
wink. During Is years, the Govern
ment gave to the railroads alone tracts
as large as the States of Maine, New
Hampshire. Vermont, Massachusetts,
Rhode Island, Connecticut, New York
and hunk of Pennsylvania.
That was the period when the first
steps toward monopoly were taken by
business. Politicians were not squeam-
ish. Neither were business men.
Pools in the cordage industry about
1850 appear to have marked the first
step toward monopoly. Then came
the Michigan Salt Association and
later pools involving anthracite, oil,
gunpowder, liquor, wallpaper, sand
paper felt and envelopes. Generally
these were agreements among groups
of companies to divide output and
limit production. Some pooled profits
and expenses.
Many great industrial empires which
still exist were being built in this
period. Jay Gould. William H. VAN
derbilt, Coils P Huntington, James
j. Hill and Edward H. Hartman were
taking over the major railroads, some
times none too gently. John D. Rookie
feller was clamping down on the oil
business. Andrew Carnegie was set
ting up his steel stronghold. Jay Cooke
and j. P. Morgan were going after the
banking business. William A. Clark
was gathering in mines. Philip D.
Armour was getting himself set in the
packing industry.
Two Had Fortunes to Start
OF these, Morgan and Vanderbilt
were the only ones who had family
fortunes to start with Carnegie had
been q stationary engineer. Cooke
was q clerk in a general store. Gould
had been surveyor and tanner.
Huntington, Armour and Clark worked
on their fathers farms. Hill had
clerked for a st. Paul steamboat COM
pany. Hartman was an office boy.
Rockefeller began as bookkeeper.
The railroads had much to do with
the development of the huge concerns
that grew up. It was special rates
granted by the roads to favored firms
which gave those firms advantages
that enabled them to drive their
smaller competitors out of business
by the hundreds. Not one, but several.
OF the big firms which developed
through the period owed their rapid
growth to these lower rates.
Such concession had been at the
base of plans for the South Improve
ment Co.. the first endeavor to COM
bine the oil refiners. The members
OF this combination not only were to
have had much cheaper freight rate
than their competitors but were to
have been given rebate amounting
to $6,000,000 year on the oil that
their opponents shipped at the higher
rate
After the South Improvement Co.
was beaten down by premature pub
liclty and opposition, Rockefeller
gained from the railroads rebate on
Standard Oil shipments. Testimony
in later years said that this rebate,
amounting to a cheaper rate than
paid by his competitors. was claimed
because he was the biggest shipper. |
Bought Out Competitors.
With this advantage in hand. the
company closed down other refiners
and began to buy out competitors at
not-too-high prices.
Within 10 years it had gained con-
troll OF the refining field
One Of the most capable observers
says "its services to the public were
, immense and efficient; its administra.
tive organization marvellous in struc-
ture and performance; its earnings
as high as the managers cared to make
them.
But the firm was still a loose fed
GRAFTON, grouped about the original
company which owned the controlling
Interest in all affiliated plants. To
gain q tighter organization, separate
Standard Oil corporations were
formed in strategic States and fused
into one combination by placing the
shares in the hands Of nine trustees.
They issued trust certificates to the
owners and these nine men managed
the enterprise. That was the Stand
ard Oil trust formally created in
January, 1882.
Other similar combinations followed