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American Oligarchs & the Influence They Wield

Meet the Rockefellers

by DAVID ROSEN

On the morning of Independence Day, July 4th, 1914, an explosion shattered the side of a New York tenement building at 1626 Lexington Avenue.  Local residents were showered by shattered window glass, brick fragments, cracked piping and splintered wood.  The explosion came from an apartment that was home to a group of anarchists and the bodies of three of them, Charles Berg, Arthur Caron and Carl Hanson, were found amidst the rubble.

The police determined that a cache of Russian nitroglycerine had detonated.  The press reported that is was the largest dynamite explosion in the city’s history and the intended target was John D. Rockefeller, Jr.  For most of his life, JDR, Jr., lived in the shadow of JDR, Sr., and his vast corporate enterprises and fortune.  By ’14, he was a respected philanthropist who helped establish the family foundation and other public institutions.

In the spring of 1914, a bitter showdown took place in Ludlow, CO, between coal miners trying to organize with the United Mine Workers of American and old-line capitalists fighting unionization.  On April 20th, private guards of the Baldwin Felts Detective Agency attacked striking workers at the Colorado Fuel and Iron Company, killing 18 men, women and children. The standoff became known as the Ludlow Massacre – and the Rockefellers owned the mine and JDR, Jr., was on the board.

New Yorkers from nearly all segments of the left, including socialists and anarchists, mobilized to express their outrage over the “massacre.”  Mass rallies took place in Union Square, drawing thousands, with the anarchist Alexander Berkman often a principle speaker.  Though JDR, Jr., had largely given up daily involvement in his father’s businesses, he became the target of their political rage, for Ludlow and for the miserable working and living conditions experienced by New York City’s laboring poor.

The clash between JDR, Jr., and New York radicals took place within rapidly a shifting political context.  In 1916, President Woodrow Wilson was reelected based on his campaign promise: “He kept us out of war.”  Wilson, along with Congress, declared war in April 1917.  In the wake of the war, JDR, Jr., became a labor-management “reformer” while and Russian-born Berkman – along with Emma Goldman and about a thousand others — was deported in the notorious Palmer Raids of 1918-1921.

* * *

JDR, Sr., was born July 8, 1839, in upstate New York and was raised in Cleveland, OH.  His father, William Avery Rockefeller, called himself a “doctor,” but has been referred to as a “pitch man,” ”botanic physician,” peddler and quack, someone who sold self-concocted cancer and other medicinal cures.  However, the young Rockefeller was a different story.  He excelled in “sums,” calculating additions and subtractions in his head, and became a bookkeeper, then a merchant in grain, hay, meats and miscellaneous goods.

In August 1859, oil was struck near Titusville, PA, transforming northwestern Pennsylvania into what became known as the “oil regions.”  Rockefeller saw the coming of America’s great transition from a rural, agricultural country to an urban, industrial nation.  He positioned himself accordingly.  Federal spending for the Civil War financed his adaptation to the new order.

Rockefeller was a staunch abolitionist, an old-school Christian Republican who voted for Lincoln.  However, he avoided service in the Union Army by being his family’s primary breadwinner, head of his own shipping company.  With a blockade of the South in place, Cleveland became a leading port into Lake Erie and northern shipping.  Rockefeller was a war profiteer, reported making a profit of $17,000 in 1862 alone; equivalent to $350,000 in 2013 dollars.

After the war and rich with cash, Rockefeller moved aggressively into the oil refinery business.  In 1866, he established Standard Works and opened an office in New York City.  By 1868, Rockefeller and his partners ran one of the nation’s largest refineries.

Rockefeller was a smart — and ruthless — businessman, introducing one of the first fully-integrated industrial production and distribution operations.  His system included the most technologically advanced refineries (his team figured out how to remove the smell of sulfur from the oil and recovered the sulfur for commercial reuse) to barrel making, warehousing and shipping via railroad tank cars (which his team also invented).  He even recycled waste products like kerosene and high-quality lubricating oil.  In addition, he paid above-market wages to prevent strikes and labor unrest.

In 1870, JDR, Sr., established the Standard Oil Company and used it to aggressively consolidate control over the nation’s oil refining.  He did this through tightly controlling output, aggressively cutting prices and setting favorable terms with railroads.  By 1879, Standard Oil controlled about 90 percent of U.S. refining. By 1890, it operated a nationwide distribution system that, in 1904, served four-fifths of the nation’s businesses and homes.  Rockefeller remade a highly competitive market into an oligopolistic industry.  And in the glory days of Gilded Age, oligopolies – trusts – were not illegal.

The passage of the Interstate Commerce Act (1887) and the Sherman Antitrust Act (1890) began to address some of the anti-competitive practices used byJDR, Sr., and other Robber Barons to dominate sectors of the economy.  In 1902, Ida Tarbell, writing in McClure’s Magazine, published a series of 19 articles that exposed Standard Oil’s unscrupulous practices.  Backed by Pres. Theodore Roosevelt – who had named Tarbell and her fellow McClure’s journalists “muck-rakers” – the U.S. attorney general sued Standard Oil in 1906 over restraint of trade.  In 1911, the Supreme Court unanimously found Standard Oil to be a monopoly and broke it into a series of “smaller” companies, including Amoco, Chevron Conoco and ExxonMobil.

Nor should it be forgotten that the Rockefellers, both JDR, Jr., and the General Education Board (precursor to the foundation), took a strong stand on moral or “culture wars” issues.  The most pressing was the pollution of the white race.  The Rockefellers, along with the Harriman and Carnegie, supported the Eugenics Record Office (ERO) run by Dr. Charles Davenport; ostensible liberals like Theodore Roosevelt, Woodrow Wilson and Margaret Sanger embraced eugenics.

In 1911, Davenport published an influential book, Heredity in Relation to Eugenics.  Shocked by the massive influx of Eastern and Southern Europeans to U.S. cities, he warned: “the population of the United States will, on account of the great influx of blood from South-eastern Europe, rapidly become darker in pigmentation, smaller in stature, more mercurial, more attached to music and art, [and] more given to crimes of larceny, kidnapping, assault, murder, rape and sex-immorality.”  Most telling, he predicted, “the ratio of insanity in the population will rapidly increase.”  His analysis does not include the African-Americans, Jews, Asians, Middle Easterners and Native-Americans who likely only further polluted the race pool.

Eugenics was legitimized and used to justify the draconian Immigration Restriction Acts of 1921 and 1924.  The movement’s efforts culminated in the 1927 Supreme Court decision approving forced sterilization.  An estimated 60,000 people were sterilized as biologically inferior humans in the seven decades that eugenics was in vogue.  Steven Jay Gould noted:  “Sterilization could be imposed upon those judged insane, idiotic, imbecilic, or moronic, and upon convicted rapists or criminals when recommended by a board of experts.”  He fails to mention the feeble-minded, the promiscuous woman and the homosexual. Sterilization was most often imposed on youths, the poor, women and African-Americans.

* * *

Time – and good PR — heals many wounds.  The Ludlow Massacre is all but forgotten and the Rockefeller name sanitized.  Standard Oil is long gone, but the family’s glow lives on.

Ludlow was the nadir of the Rockefeller dynasty.  According to some estimates, Rockefeller, Sr., was the first American to ever have a net worth over $1 billion and was America’s richest plutocrat who, at the time of his death in 1937, was worth the equivalent of $340 billion in current dollars.  While people may die, families – with their money, corporations and influence — live on.

Robert Frank, writing in The Wall Street Journal a few years ago, observed that “with more than 150 living blood relatives of John D. Rockefeller Sr., many members of the latest generation of the family — known as the ‘fifth-sixth’ generation — aren’t likely to be able to live off their dwindling family trusts, according to people close to the family.”  Going further, he noted, “critics also point out that over the past 20 years, not a single Rockefeller has made a significant new fortune by starting a company.”

Descendants of Rockefeller, Sr., and JDR, Jr., have long exercised their influence playing the political card.  However, with the announced retirement of JayRockefeller (D-WV) – born John D. IV – marks the end to the family’s involvement in formal, electoral politics.  Other family politicians included Nelson, former Republican governor of New York and vice president under Gerald Ford; Winthrop, Republican governor of Arkansas in the 1960s; and his cousin Win, lieutenant governor of Arkansas for a decade under then-Gov. Mike Huckabee (R).  According to The Washington Post, politicians related to the Rockefellers include Minnesota Gov. Mark Dayton (D), former senator William Proxmire (D-WI), former senator Charles Percy (R-IL) and Sen. Sheldon Whitehouse (D-RI).

The political fate of the Rockefeller dynasty is similar to that of the Kennedys.  Leveraging the fortune of Joseph, Sr., the sons – including John, Robert and Edward (Ted) — carved out a half-century of liberal politics.  Third-generation family pols include Rep. Patrick Kennedy (D-RI) who retired in 2011 and Rep. Joseph Kennedy III (D-MA) who current serves. 

Nevertheless, the Rockefeller legacy lives on.  New York could be renamed Rockefeller-ville, given the family’s – and its fortune’s — influence in the shaping of the modern city.  The family funded or contributed enormously sums to scores of projects that distinguish modern New York.  The anchor institutions include Rockefeller Center (home to NBC and Radio City Music Hall), the United Nations, Lincoln Center, Riverside Church, the Museum of Modern Art and the Cloisters with the New Jersey Palisades Park.  Family wealth also established Rockefeller University and the Council on Foreign Relations.  In addition, Rockefeller money underwrote the restoration of Colonial Williamsburg, the University of Chicago and the establishment of large protective forests for California redwoods and other national parks.

Like a vampire, the wealth of the plutocrats lives on long after they’ve died and their bodies interned in their final resting places.  The Rockefellers are America’s grandest oligarchs, revolutionizing the economy, using anti-competitive (including illegal) practices to gain market dominance, inflicting suffering on the vast majority of workers they employed and backing some social programs that were racist if not inhuman.  And they and their fortune have done some good; time heals all wounds.  Whether a similar fate awaits today’s oligarchs – most notably the Walton family, the Koch brothers and Sheldon Adelson – remains to be seen.

David Rosen can be reached at drosennyc@verizon.net; check out www.DavidRosenWrites.com.