‘Bound to Be Rich!’ Rockefeller’s Pious Greed

Titan: The Life of John D. Rockefeller Sr. , by Ron Chernow. Random House, 774 pages, $30.

How could this pious man, who invented modern institutional philanthropy and lived according to the strictest rules of church attendance, abstinence, hard work and charitable giving, at the same time have conducted his business affairs with utter ruthlessness? Ron Chernow’s fascinating biography explores all three sides of John D. Rockefeller Sr.’s life–personal, business, philanthropic–and remains puzzled by this inconsistency. All the way through the book, he chews at the problem. I offer a lesson of history: Fanatic piety may condone evil means.

As a boy, Rockefeller was taught in a one-room country schoolhouse. At 16, he found a job as bookkeeper with a firm of merchants. He applied unceasing energy to his affairs. “Work enchanted him, work liberated him, work supplied him with a new identity,” Mr. Chernow writes. One day, Rockefeller said to an older businessman, “I am bound to be rich–bound to be rich– bound to be rich! “

From the first, he gave generously to charity, even when he had very little money himself. At 20, he gave away more than 10 percent of his income, including a gift to a black man in Cincinnati to buy his wife out of slavery. When he joined the Erie Street Baptist Mission Church in Cleveland, he helped sweep out the halls, usher worshipers to their seats and wash the windows. He attended Friday-evening prayer meetings and two services on Sunday. He abhorred drink, dancing, cards and theater.

John D.’s father, William A. (“Big Bill” or “Devil Bill”) Rockefeller, was a flimflam artist who wandered widely, selling cancer cures and other nostrums from a cart. He offered women berries resembling pills, warning them that abortion might result if they were pregnant, which stimulated sales. In due course, Big Bill married devout,. abstentious Eliza Davison and moved her in with his housekeeper-mistress, the beauteous Nancy Brown. The two women started having children in alternation. John D. was born on July 8, 1839, in a bedroom measuring 8-by-10 feet. Big Bill soon began living a double life as “Doc” William Levingston. Under that handle, he married a sweet 17-year-old girl, Margaret Allen, and thereafter wandered irregularly from one family to another.

In his latter years, John D. disavowed his father completely. So perhaps his stern rigor was in reaction to his father’s wicked ways. One can sum up the business side of Rockefeller’s career by observing that in the early 1880’s, the Standard Oil Company refined and transported 85 percent of America’s oil, used as kerosene for illumination, not only for America and Europe, but also for China, Japan and India. In the next decade, Standard Oil entered oil production, attaining a third of U.S. output. How was this possible? Mr. Chernow explains in great detail. Rockefeller was a business genius, although his methods were more than rapacious. Starting in 1879, “Rockefeller began a 30-year career as a fugitive from justice”–i.e. process-servers and Congressional summonses.

Mr. Chernow has examined 20,000 pages of letters to Rockefeller from his associates. They were much less discreet than John D. himself, who was careful not to put things to paper that might be used later in court. As a result, transactions can be documented that once were only suspected. Mr. Chernow says that “he and Standard Oil entered willingly into a staggering amount of corruption,” and that “his correspondence implicates him directly in this skullduggery.” Here, for example, is U.S. Senator John Newlon Camden writing to Rockefeller’s associate, Henry Morrison Flagler: “Politics is dearer than it used to be–and my understood connection with the Standard Oil Co. don’t tend to cheapen it –as we are all supposed to have bushels.” He asked for “$10,000 in some turn–stocks or oil.” On another occasion, he wrote, “I have arranged to kill the two bills in Md. legislature at comparatively small expense.”

Another Rockefeller business tactic was extorting rebates from the railroads that carried his oil, to the amazing point of getting kickbacks on oil shipped by other producers! This, of course, made it inordinately difficult for them to compete. For long the rebates and kickbacks were hidden, although widely suspected. Finally, it all emerged in court and in legislative reports. A New York State Assembly hearing revealed that Rockefeller had extracted 6,000 secret contracts from the New York Central and Hudson River Railroad and similar ones from the New-York and Erie Railroad. In 1907, Standard Oil was fined about half a billion in today’s dollars. A series of extremely hostile exposés inflamed the public. Rockefeller received a blizzard of death threats, and Teddy Roosevelt took an ax to the enterprise.

On the good side, John D. built large enough refineries to make much cheaper kerosene; during Standard’s reign the price dropped substantially. The oil refining and shipping business had been composed of inefficient units, which Rockefeller gobbled up, sometimes by ruining them, thus bringing order to the industry.

By his 50’s, Rockefeller had become so enormously wealthy that more money meant nothing to him. In today’s money, his dividends reached about a billion tax-free dollars a year. To reach that figure after tax would now require capital of perhaps $40 billion. Since he was also able to pass on what he wanted to his offspring without estate tax, in effective terms his capital would be double that, so he was vastly richer than any American of our time. He began to give away huge sums, following these donations with the same minute attention that he had given to the business. He was inundated by requests. After the announcement of one large educational gift, he received 15,000 letters in a week and 50,000 by the end of the month!

Eventually, he concluded that he could only cope by developing a system of wholesale philanthropy. One can thus say that he developed the whole concept of modern institutional giving. Among his most noteworthy large munificences were the Rockefeller Institute for Medical Research, which later became Rockefeller University, boasting numerous Nobel laureates on its faculty. Another was the Rockefeller Sanitary Commission, which helped root out hookworm in the Southern states. Perhaps the most important was his early support of the University of Chicago. His philanthropic streak stayed in the genes. Indeed, the Rockefellers have enjoyed an almost unique success among American plutocratic families in maintaining their philanthropic attitude from generation to generation.

Perhaps the only record to compare with Rockefeller’s in public philanthropy is that of Andrew Carnegie, who put up libraries and other institutions all over America. Rockefeller, who often gave anonymously, considered Carnegie a bit showy for displaying his name so widely. On the other hand, Carnegie’s famous dictum, “The man who dies rich dies disgraced,” certainly did not apply to Rockefeller, whose gifts to his son, John D. Rockefeller Jr., who became one of the world’s first full-time professional philanthropists, were themselves enormous. Like his father, the younger Rockefeller spent much of his life avoiding mendicants, journalists and process-servers.

The elder Rockefeller, fixated on reaching 100, never drank or smoked. He decided that consuming celery eased the nerves, ate an orange peel before breakfast, believed in a tablespoon of olive oil daily, and was devoted to osteopathy and massage. He waited for his food to cool and then chewed each bite, including liquids, 10 times. He would still be eating half an hour after his guests had finished, and then spent an extra hour at table for digesting. Unfortunately, his hair started falling out when he was 47 and had altogether vanished five years later. This gave him a sinister, mummified look, the image that his contemporaries had of him.

In later years, he followed an invariable routine: Awake at 6 A.M. Newspapers for an hour. Wander through the house and garden between 7 and 8, handing out small sums to retainers he encountered. Then breakfast, followed by numerica, a number game. From 9:15 to 10:15, correspondence, largely begging letters–up to 2,000 a week. Thereafter, golf until 12 P.M. From 12:15 to 1, bathe and rest. Lunch and numerica from 1 to 2:30. Thereafter half an hour on a sofa, listening to letters. From 3:15 to 5:15, a drive. Rest from 5:30 to 6:30. Dinner 7 to 9, followed by more numerica. From 9 to 10, listen to music and talk to guests. At 10:30, bed. He followed this cycle almost to the minute. He almost achieved his century, finally, weighing less than 90 pounds, succumbing in 1934 at 95, against the then odds of 1 in 100,000.

What a story! Mr. Chernow, as we have come to expect, has given us an outstanding business biography.

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