From the Gilded Age emerged giants of industry; among them a couple of rags to riches stories that embedded in American history.
John D. Rockefeller was born in New York. The son of a con man and a devout Baptist mother, his father abandoned his family to poverty and began a second family. Before automobiles, Rockefeller realized the potential in refining oil and started Standard Oil Company. He decided to weed out other oil businesses by flooding the market with his own oil, driving down prices, and reducing profits for his competitors. He then approached his economically struggling competitors and offered to buy their failing businesses at low prices. In less than six weeks, Rockefeller took over 22 of his 26 competitors and controlled almost 95% of oil refining. He then slowed production and increased profits dramatically by charging consumers higher rates. He also created vertical integration, wherein he built his own pipelines, tanks, and storage facilities so that he did not pay other rental or usage groups. With such economic power, he was then able to threaten railroad companies that hosted his competitor’s oil so that his competitors could not find shipping measures.
Andrew Carnegie was born in Scotland and immigrated to the United States. At thirteen years old, Carnegie began working as a bobbin boy in a Pennsylvania factory. His family struggled economically but remained close and imbued in Carnegie ideas of morality and fairness. After the Civil War, new methods that made steel much cheaper to produce convinced Carnegie to invest in the industry with his meager earnings. He took advantage of natural industrial recessions to buy competitors businesses and expand his company.
Why might John Rockefeller and Andrew Carnegie be so different in their business practices? What major influences or experiences in their young lives affected their thinking and behavior??