Saturday, February 23, 2013

The British Empire

Hello! Here is a 5 part video about British expansion to the India and the African Continent. After the video, I have included some of the most important concepts and a brief overview of what it is about.



The British Empire, unlike other Empires, didn't exploit its colonies completely, but tried to improve them by bringing Christianity and British goods to them. This "New Spirit" of the British colonies was greatly enforced by the missionary and explorer David Livingstone, who was kind of an Indiana Jones with a Bible. David Livingstone began as a poor child laborer, but worked hard to get the education necessary to become a medical doctor. The "New Spirit" didn't really want to promote the slave trade, but to abolish it. The British anti-slavery movement was caused by a revival in religious interest. 

Some of the leaders of this "Revival" were members of a called Clapham Sect, which was a leading group of Anglican anti-slavery activists, including Zachary Macaulay and its center personality: William Wilberforce. The Anti-slavery activists in Britain and America were also known as "abolitionists." Under the pressure of these people, the British government abolished slavery in 1807.

The video is mainly about how Great Britain began to look for establishing colonies in Africa and the India. The British saw Africans as little more than animals, without a culture, without civilization. Still, they were interested in possessing African colonies because of the natural resources of the land, and another, more important reason. This reason was the slave trade. The British saw Africa as a great source of human strength, in the form of slaves. Slave trading was pretty profitable: for example, a sugar plantation of a hundred black slaves required at least 80 new slaves a year to maintain productivity. This continued to increase slave trade profits, which also increased the British interest in Africa. This was until the British abolished slavery.

Some African practices and parts of their culture really annoyed the British, such as their sensuality and polygamy (having multiple wives). This generated a culture shock, which is a misunderstanding between two cultures that dislike each other. David Livingstone began his major missionary work at the Kuruman mission in South Africa, became frustrated, and began to shift his focus to exploring the African interior. He was really surprised to see that slave trade was still active in East Africa, and wanted to create an  economic exchange between the British and the residents of the African interior that could help to replace the slave trade as a source of profit. He thought that the lower Zambezi river could be used as a trade route, and his motto was "Christianity, Commerce and Civilization."

In  the case of India, the British interests were completely different. The British accepted that Indians were civilized and had a culture which was different to theirs, so they treated them much better than how they treated the Africans. At first, they let them keep most of their traditions, but did impose some laws and destroyed some of the traditions they had. Still, Christianity is a proselytizing religion which is always looking for more people, new converts. The British India Company thought that it would harm commerce to try to change Indian culture or religion. In fact, some British would go to India and adopt some of their costumes and traditions. Still, the Clapham Sect and other evangelical Christians wanted the Parliament to allow them to send missionaries to India, which they accepted in 1807.

This created a great tension between the two civilizations. The missionaries were greatly annoyed by female infanticide (killing infants) and suttee (burning themselves in their husband's funeral). A while later, a rumor spread that the sepoys' (Indians in the British army) new cartridges were sealed with pork and beef fat, which was prohibited for both Muslims (they thought the pork to be unclean) and Hindus (they thought the cows were sacred).  The rumor set off a major mutiny in the army, which resulted in many British Deaths. This was called the "Sepoy Mutiny". The British sent more troops to India, and it was said that their path was marked by Indian soldiers hanging on trees.

Dr. Livingstone
Still, some Evangelicans, including Livingstone, thought that the Christianization of India and the other British colonies wasn't going fast enough. Some missioners that had decided to follow Livingstone discovered that he was wrong about many things: the Zambezi River wasn't totally navigable, and the places he wanted the missioners to stay in were unhealthy because of some mosquitoes that carried malaria.

Some time after, Livingstone went searching for the source of the Nile and disappeared for several years. A great journalist named Henry Morton Stanley went looking for him, and after a while he found him an African village named Tangayika. They say that the first thing Henry Morton Stanley said to him was: "Livingston, I presume?" Years later, in 1873, Livingstone died, and in that same year the slave trade in the east was abolished.

After all, Christianity stayed as a major religion in Africa by the use of military force of the British people.

Sunday, February 10, 2013

Nelson and the Battle of the Nile

Hello again! In this post I'm going back to the 18th century, the times of the Great Napoleon, but this time we will study his great British nemesis: Horatio Nelson, and the great Battle of the Nile, in which he defeated Napoleon for the first time. Here is the video with a summary. Enjoy!


The 18th century was a century of revolution and conquest for most of Europe. The French had killed their king, and only Great Britain remained as a country against the Republican Ideals. This nation had had many national heroes, but one of the best was Admiral Horatio Nelson, who was respected by both his superiors, equals and subordinates. He was passionate and courageous, had everything he needed to become a hero. He had given much to his nation, but in 1794, while commanding an operation he had been wounded on his right eye, and in 1797, at the command of admiral John Jervis, he had secured a great victory against the Spanish: by disobeying his orders he managed to cut off the retreating ships. Great Britain wanted good news and victory, and since its neighbor, France, was ruler of most of Europe, they needed good heroes. Admiral Nelson was happy to be one.

     Despite the naval victories, war was not going well for Great Britain. The French won land battle after land battle, and without allies, Britain had been forced to retreat completely from the Mediterranean. Still savoring the victory against the Spanish, Nelson was tasked to take Spanish treasure ships to the control of Great Britain. The operation was a disaster: they lost element of surprise and the tides were against them... Nelson was hit on the right elbow. The ship was destroyed, and had he not been assisted, Nelson would have been lost forever. With his left arm for the first time he wrote that he had become a burden to his friends and useless to my country: an admiral without his right arm was nothing. Still, the black mood did not last long, and by spring of 1798, Britain was ready to reenter the Mediterranean. Intelligence reports said that the French were on the move and on large numbers, but no one knew their destination.

     In the command of this French Operation was general Napoleon Bonaparte, who had been granted permission to invade Egypt, and then travel to India to destroy British possessions. The expedition sailed on the 19th of May, with nearly forty thousand troops and four hundred transports and 40 battleships. Nelson didn't care about the weather and the lack of information and went hunting for the enemy.

     Whispers from different people sent Nelson and his squadron from one place to another, while the French fleet seemed to be very elusive. While hunting the enemy, a storm almost destroyed the admiral's ship, tearing all of its three top masts, sending them towards shore in certain disaster. The Alexander went to save them, but it seemed they would lose both ships, so Nelson told the Alexander's captain to cut loose and save themselves. The captain refused this order, and with determination, skill, and luck, both ships went away safe. During the storm the squadron had become scattered, and Nelson had lost his tactical eyes.The frigates and the scout ships had become separated and returned to Gibraltar. After months of searching for the French, the admiral decided to search the shores of Egypt. The British arrived earlier than the French, and went upstream, only returning to the delta when the French had had time to land. On the afternoon of the first of August, the enemy fleet was finally discovered.

     Most of the French were ashore and thought to be well protected, but in no condition to fight. Nelson's fleet, on the other hand, was able to form a well-trained fighting unit. He created a band of brothers with all his captains, which became legendary. By listening to their counsel, he had created an unstoppable fighting force. When they came down on the French, there was only one expected result. The British attacked, and destroyed the French fleet, catching them totally unprepared. They were totally sandwiched by the British. They took on ship after ship. Nelson was wounded on his good eye, but it was not that serious and he was back on the field a while later. The bravery of the remaining French was almost beyond belief, but that couldn't save them. Nelson was severely wounded, his head and arm bleeding, and a cannonball almost cut him in two, but he stayed in the fight, refusing medical help. They were all able to see the mighty explosion of the French ships, how the fire spread and all the fleet was torn apart. Nelson had defeated and destroyed the "almighty" General Napoleon's fleet. Nelson returned to Great Britain as a national hero, to hug his beautiful wife one more time...

Friday, February 8, 2013

"The Gentlewoman and the Robber Baron" (Questions)

Hey, there! Here is a set of questions and answers about "The Gentlewoman and the Robber Baron." Here is the link for the full text, which I have uploaded. I hope these questions are useful for you!


What were the most important magazines in America in 1902?
The most important magazines during that time were McClure's and Munsey's magazines.

Who was Mark Twain? How did he become involved in Ida Tarbell's investigation of Standard Oil?
He was a famous public figure and writer. He became involved when Standard Oil asked him to investigate what Ida Tarbell and the magazine she was working for were planning to write about  Standard Oil.

Why did Ida Tarbell pray not to get married?
Back then, women were almost like slaves to their husbands, and Ida Tarbell wanted to be free.

Who were the suffragettes? How did they influence Ida?
They were the women who were fighting for the right of vote, and they told Ida that she had to be spinster if she wanted to be free.

What was the most important thing in John Rockefeller's life?
There was kind of a tie between the importance of his whole family and his oil refinery monopoly.

What is a rebate?
When a part of the money a person paid is given back as a refund.

How did the railways give preferential treatment to Standard Oil?
Since their oil was better, the railways worked better and cheaper for the members of Standard Oil.

What is the difference between crude oil and refined oil?
Crude oil is much cheaper, and  the quality of refined oil is much better. Crude oil is just as it is extracted from earth, while when you refine oil you separate all of its components so you can get a better use of them all.

Did Standard Oil practice horizontal integration, vertical integration, or both?
They practiced both, because they were slowly eradicating competence and lowering the prices they paid by buying both refineries and crude oil traders. Originally followed the path of horizontal integration, but later in its history it turned toward vertical integration.

Ida Tarbell summarized Rockefeller's goal: Controlling all refineries, I shall be the only shipper of oil. Being the only shipper, I can obtain special rates of transportation which will drive out and keep out competitors; controlling all refineries, I shall be the only buyer, and can regulate the price of crude [oil] as I can the price of refined. If Rockefeller controlled the entire market of oil, what would he have?
He would have a monopoly of one of the most expensive and demanded materials on Earth: the black gold. He would be able to do whatever he wanted with it, in prices, quality, blackmailing government and other companies, etc.

What did Ida Tarbell have to say about "The Legitimate Greatness of Standard Oil"?
Even though Ida Tarbell criticized the monopoly, she admired the efficiency of the company and recognized that it "had resulted in a master piece of organization."

What percentage of the nation's oil business did Rockefeller own by 1879?
He owned about 90% of the U.S. oil business.

What are muckrakers?
The term means to journalists, no matter if they are responsible or irresponsible.

What law did the U.S. Government use to sue Standard Oil?
They used the Sherman Antitrust Law

What did the U.S. Supreme Court eventually decide in that lawsuit?
They decided that they would accept the dissolution of Standard Oil Trust.

What did Rockefeller's son John Rockefeller, Jr., do with his money?
He lent most of it.

What happened when John Rockefeller, Jr., and Ida Tarbell met at a conference?
They tried to avoid each other, avoiding the awkward moments if they brought out the theme of how Ida Tarbell destroyed his father's legacy.

'The Gentlewoman and the Robber Baron" (Text)


When Ida Tarbell set out to probe the operations of John D. Rockefeller’s Standard Oil Trust, it seemed like David against Goliath all over again
Virginia Van der Veer Hamilton
One wintry morning in 1902 a prim, resolute spinster presented herself at 26 Broadway in New York City, bastion of the powerful Standard Oil organization. Promptly she was ushered through a maze of empty corridors to a reception room facing an open courtyard. As she waited, she became aware that a man in a nearby window was observing her stealthily.

Over the next two years this unlikely visitor paid many calls to one of the most awesome addresses in the American financial world. Each time she saw only the clerks who guided her, a secretary, and Henry H. Rogers, vice president of Standard Oil. But always she noticed the same shadowy figure watching her from the window. Was John D. Rockefeller, master of the oil industry, peeping at Ida Minerva Tarbell, lady journalist?

If so, Ida’s turn to peep came one Sunday in 1903 when she visited the Euclid Avenue Baptist Church in Cleveland. Feeling a little guilty about it, she had invaded Rockefeller’s church for a firsthand look at the man whose business practices she dared to castigate. Her quarry soon appeared. At sixty-four Rockefeller exuded power, but Ida observed that his big head had a wet look, his nose resembled a sharp thorn, and his lips were thin slits. Constantly, uneasily, Rockefeller peered around the familiar congregation, but if he recognized the stranger in its midst, he gave no sign.

Although the nation’s richest man and his most persistent critic never met, their confrontation in the pages of McClure’s Magazine enthralled thousands of Americans. Safe within their Victorian mansions, well-bred ladies shuddered at the audacity of one of their sex who had the spunk to describe the legendary Rockefeller as cold, ruthless, and unethical.

For eighteen installments—from November, 1902, to April, 1904—Ida’s monumental “History of the Standard Oil Company” fired the indignation of middle-aged and middle-class citizens caught up in the rebellious mood of Progressivism. Politicians from statehouse legislators to Teddy Roosevelt at the White House took note of the furor. Its echoes eventually penetrated even the remote chambers of the Supreme Court.

Readers of McClure’s , turning through their October, 1902, issue, were introduced to the sensational serial by a full-page photograph of Ida. The magazine’s star writer wore a severe, high-collared white dress adorned with tucks and embroidery, and her dark hair was piled high on her head. She looked away from the camera with an air of cool detachment. Miss Tarbell, McClure’s announced, had completed her long study of “the most perfectly developed trust in existence.” Her account would begin the following month.
S. S. McClure, impulsive and mercurial, boasted that the founding of McClure’s and the discovery of Ida Tarbell were his proudest achievements. In Paris in 1892 he had bounded up four flights of steps to an apartment to meet the little-known American writer. After pouring out his plans for McClure’s , S. S. borrowed forty dollars and left. “I’ll never see that money,” Ida lamented, but to her relief the forty dollars was promptly repaid. Two years later Ida, serious, purposeful, and thirty-seven, joined the staff of McClure’s in New York.

S. S. soon had reason to congratulate himself. Ida was an immediate hit with readers, who paid ten cents a copy for his lively magazine. They liked her biography of Napoleon, produced “on the gallop” in six weeks. They followed with avid interest her series on Abraham Lincoln, written after four years of painstaking research in Kentucky, Indiana, and Illinois.

As thousands of new subscribers joined his circulation lists, McClure gave Ida most of the credit. The life of Lincoln, he said, “told on our circulation as nothing ever had before.” By 1900 McClure’s was reaching 350,000 homes and was second in circulation only to its bitter rival, Munsey’s . If McClure liked an idea, he bragged, then millions of readers would like it, too. “There’s only one better editor than I am,” he admitted, “and that’s Frank Munsey. If he likes a thing, then everybody will like it.”

Alert to the mood of his readers, McClure sensed their concern about social and political reform. Lincoln Steffens, therefore, must check into corruption in the big cities. Ray Stannard Baker must investigate labor unions and the coal strike then going on in the anthracite fields of Pennsylvania (see “The Coal Kings Come to Judgment” in the April, 1960, AMERICAN HERITAGE ). As for Ida, why not a study of one of the monopolies that frightened small businessmen? Why not, in fact, the prototype of them all? “Out with you!” S. S. commanded his talented staff. “Look, see, report.”

“Don’t do it, Ida,” her father pleaded. “They will ruin the magazine.” Others warned her of the “all-seeing eye and the all-powerful reach” of Standard Oil. If McClure’s persisted, friends predicted, “they’ll get you in the end.”

Standard Oil was well aware that a popular journalist—and a female at that—was prying into its past. Executives of the corporation asked no less a public figure than Mark Twain to inquire what McClure’s planned to publish. “You will have to ask Miss Tarbell,” S. S. replied. “Would Miss Tarbell see Mr. Rogers?” Twain inquired. When her supporters heard that Ida was visiting 26 Broadway to get the company’s side of its history, they were instantly suspicious. “You’ll become their apologist before you get through,” many prophesied.

At their first meeting Ida and Henry Rogers discovered that they had been neighbors years before in the booming oil regions of Pennsylvania, where Ida’s father had made tanks and Rogers had been an independent refiner. They even recalled the beauty of a wooded ravine separating their houses. Although she decided that Henry Rogers was “as fine a pirate as ever flew his flag in Wall Street,” Ida was not beguiled by nostalgic memories. She alone, she told the Standard Oil executive, would be the judge of what she wrote.
Diligent and methodical, Ida studied musty records of the many lawsuits brought against Standard Oil in the thirty years since its incorporation. Every pertinent document must be located: “somewhere, some time,” Ida insisted, “a copy turns up.” Rogers once suggested that Ida should meet Rockefeller himself, and somewhat apprehensively she agreed. But their meeting was never arranged.

Seeking firsthand knowledge of Standard’s methods, Ida interviewed other businessmen. Reluctant though they might be, they usually responded to her firm, dignified manner. One eccentric Cleveland millionaire received her with his hat on, his feet propped on his desk, and his face buried in a newspaper. As Ida quietly began to ask questions, he placed his feet on the floor, put down the newspaper, removed his hat, and gave her his respectful attention.

Her first installment was a vivid account of the brawling, gambling spirit of pioneer days in the Pennsylvania oil country. In 1859, when they heard the exhilarating news that oil was gushing out of a well near Titusville, thousands of adventurous Americans poured into the area, and a whole series of boom towns—with names like Pit Hole, Oil City, Petroleum Center, and Rouseville—hastily sprang up. “On every rocky farm,” Ida wrote, “in every poor settlement of the region, was some man whose ear was attuned to Fortune’s call, and who had the daring and the energy to risk everything he possessed in an oil lease.” Saloons, brothels, and dance halls catered to a drifting population of fortune seekers.
Recalling the atmosphere of her youth, Ida praised the efforts of many citizens of this rough frontier to create schools, churches, and a proper environment. Her own parents, Esther and Franklin Tarbell, had shepherded their children into respectable middle-class ways, highlighted by family picnics on Chautauqua Lake or an occasional trip to Cleveland. Crusading suffragettes visited the Tarbell home, and young Ida fell under the spell of their fervent talk. “I must be free,” she vowed, “and to be free I must be a spinster.” At fourteen she prayed on her knees that God would keep her from marriage.

To prepare for a career, Ida entered Allegheny College at Meadville, the lone girl in a freshman class of forty 
“hostile or indifferent” boys. After graduation she hoped to become a biologist, but fate and S. S. McClure decided otherwise. Now, twenty-two years later, this child of the oil regions who had elected spinsterhood and freedom was challenging the ruler of the oil industry himself.

At the close of the first chapter Ida offered her readers an enticing glimpse of the drama to come. Praising the independent oil producers, who gambled their lives and money in an uncertain new industry, she wrote:
Life ran swift and ruddy and joyous in these men. They were still young, most of them under forty, and they looked forward with all the eagerness of the young who have just learned their powers, to years of struggle and development. … There was nothing too good for them, nothing they did not hope and dare. But suddenly, at the very heyday of this confidence, a big hand reached out from nobody knew where, to steal their conquest and throttle their future.

The “big hand,” she revealed in her next installment, was an enterprising young man with “remarkable commercial vision, a genius for seeing the possibilities in material things.” As a boy of thirteen John Rockefeller discovered that lending money at 7 per cent interest was more profitable than his earlier job of digging potatoes: “It was a good thing,” the boy reasoned, “to let the money be my slave.” This principle, Ida told her readers, was the foundation of a great financial career.

During the Civil War, Rockefeller chose to sell produce to the Union army rather than to serve in its ranks. Before the war ended, the twenty-three-year-old merchant had foreseen greater potential in refining a new product, oil, to light the homes and lubricate the machines of America. Under his shrewd and frugal leadership his first refinery prospered. There must be no waste, Rockefeller decreed. He found a market even for the residuum that other refineries allowed to flow away into the ground. “It hurt him to see it unused,” Ida wrote, “and no man had a heartier welcome from the president of the Standard Oil Company than he who would show him how to utilize any proportion of his residuum.” Rather than pay a barrelmaker, Rockefeller set up his own barrel factory.

The youthful refiner got his greatest joy from a good bargain. One of those whom Ida interviewed told her that the only time he had ever seen Rockefeller enthusiastic was at the news that his firm had bought a cargo of oil much below the market price. “He bounded from his chair with a shout of joy,” the man recollected, “danced up and down, hugged me, threw up his hat, acted so like a madman that I have never forgotten it.”
On the basis of the large amount of oil he shipped eastward, Rockefeller began to receive the railroad rebates that Ida charged were the keystone of his future empire. She described how he and other large refiners conspired to force railroads to grant them “drawbacks,” additional rebates on the shipments of their competitors. Members of this clandestine combination, known as the South Improvement Company, received a rebate of $1.06 a barrel on crude oil shipped from Cleveland to New York, plus a drawback of $1.06 on each barrel shipped by their rivals. When an independent refiner paid eighty cents a barrel to ship crude oil from the Pennsylvania fields to Cleveland, the South Improvement Company received a forty-cent-per-barrel drawback on the shipment.

This advantage, Ida charged, was used as a club over the heads of other refiners in Cleveland, forcing them to “sell or perish.” His competitors wanted to keep their own businesses, Ida said, but “Mr. Rockefeller was regretful but firm. It was useless to resist, he told the hesitating; they would certainly be crushed if they did not accept his offer.” When twenty-one of the twenty-six firms sold out to Rockefeller, he controlled one fifth of the nation’s oil refining; “almost the entire independent oil interests of Cleveland collapsed in three months’ time,” Ida informed her readers. Privately an indignant Rockefeller denied Ida’s version. Standard had been an angel of mercy to the Cleveland firms in distress, he told friends. “They didn’t collapse,” he insisted. “They had collapsed before! That’s the reason they were so glad to combine their interest with ours, or take the money we offered.” However, Rockefeller, who had always met criticism with lofty silence, refused to reply publicly to the articles in McClure’s. “Not a word,” he insisted. “Not a word about that misguided woman!”
But the heir to Standard Oil, John D. Rockefeller, Jr., was stung to a veiled defense of his father’s business creation. In a speech entitled “Christianity and Business” he told members of the Y.M.C.A. at his alma mater, Brown University: “The American Beauty rose can be produced in its splendor and fragrance only by sacrificing the early buds which grow up around it.” Critics of Standard Oil never let John D., Jr., forget this unfortunate metaphor. Recalling it several years later, a bishop declared from the pulpit: “A rose by any other name will smell as sweet, but the odor of that rose to me smacks strongly of crude petroleum.”

If the creation of a perfect rose justified the sacrifice of other buds, could the same rationale be applied to the Standard Oil Trust? Ida’s answer was a vehement No. The heroes of her serial were the independent oil “farmers” and refiners whose livelihood was threatened by Rockefeller’s growing consolidation. “They believed,” Ida wrote, “in independent effort—every man for himself and fair play for all. They wanted competition, loved open fight. They considered that all business should be done openly; that the railways were bound as public carriers to give equal rates; that any combination which favoured one firm or one locality at the expense of another was unjust and illegal.”

The producers rose in united revolt against the South Improvement Company and the man whom they believed to be its Mephistopheles, refusing to sell oil until railroads agreed not to grant rebates, drawbacks, or any other special privileges. Ida remembered vividly that her own father, by then a producer himself, was one of those who had pledged not to sell.

The South Improvement Company scheme was defeated, but Rockefeller, Ida said, “had a mind which stopped by a wall, burrows under or creeps around.” He next negotiated a new rebate arrangement between Standard Oil and the New York Central Railroad. In a burst of indignant prose Ida berated her protagonist:
There was no more faithful Baptist in Cleveland than he. Every enterprise of that church he had supported liberally from his youth. He gave to its poor. He visited its sick. He wept with its suffering. Moreover, he gave unostentatiously to many outside charities of whose worthiness he was satisfied. He was simple and frugal in his habits. He never went to the theatre, never drank wine. He gave much time to the training of his children, seeking to develop in them his own habits of economy and charity. Yet he was willing to strain every nerve to obtain for himself special and unjust privileges from the railroads which were bound to ruin every man in the oil business not sharing them with him.
Rockefeller’s next tactic, Ida explained, was to form a national Refiners’ Association to force oil producers to sell their output to a united front of refiners. To offset the power of the refiners, drillers organized a Producers’ Association. The producers realized that overproduction was their curse. If they agreed to stop drilling new wells for six months and shut down their pumps for thirty days, supplies of crude oil would dwindle, and prices would rise. To the producers’ surprise, Rockefeller and his fellow refiners offered them a contract for 200,000 barrels of oil at $3.25 a barrel. They signed. But when 50,000 of the 200,000 barrels had been shipped, the refiners’ association broke its contract, declaring that the producers had failed to limit production and that plenty of oil was available at $2.50 a barrel. Ida placed the blame on Rockefeller for “leading them into an alliance, and at the psychological moment throwing up his contract.”

One producer told Ida what it had been like to negotiate with Rockefeller, who during one meeting sat and rocked with his hands covering his eyes.

I made a speech which I guess was pretty warlike. Well, right in the middle of it, John Rockefeller stopped rocking and took down his hands and looked at me. You never saw such eyes. He took me all in, saw just how much fight he could expect from me, and I knew it, and then up went his hands and back and forth went his chair.

Month by month Ida pressed her indictment, picturing Rockefeller as a sinister conspirator obsessed with a passion to control the entire oil industry for the “holy blue barrel,” as his competitors called it, of Standard Oil. He arranged for Standard to receive even more favorable rebates from major railroads. When independent operators developed a revolutionary new means of transporting oil by pipelines, the canny Rockefeller realized that this method was the shipping trend of the future. He moved into the pipeline business, driving out rivals until he controlled the entire pipeline system of the oil regions. He set up a nationwide network, paying spies to report on rival shipments, deliberately underselling his competitors, and then, having driven his rivals out of a territory, set any price he pleased.

Summarizing Rockefeller’s goal, Ida wrote:

Briefly stated, his argument was this: “Controlling all refineries, I shall be the only shipper of oil. Being the only shipper, I can obtain special rates of transportation which will drive out and keep out competitors; controlling all refineries, I shall be the only buyer, and can regulate the price of crude [oil] as I can the price of refined.”

The charge of spying, published in a chapter titled “Cutting to Kill,” abruptly ended Ida’s harmonious interviews with Henry Rogers. To substantiate her charges, McClure’s reproduced records sent to Ida secretly by a young shipping clerk in a Standard plant. They were undercover reports from railroad agents, listing oil shipments by rival producers. On her next visit to 26 Broadway, Ida found Rogers “by no means cordial.” When he asked where she got “that stuff,” she replied boldly: “You know very well that I could not tell you where I got that stuff, but you know very well that it is authentic.” It was their last interview.

Although the doors of Standard Oil closed to Ida, she was invited to meet an even more unexpected source of information. Frank Rockefeller summoned her secretly to Cleveland to hear his grievances against his successful brother. To help finance a shipping business, Frank had borrowed money from John D. and put up his Standard Oil stock as collateral. During the Panic of ’93, when Frank was unable to meet his obligations, John D. foreclosed and took over the stock. Frank, observed Ida, was more frivolous than his brother, more generous, “not a safe man to handle money. … So it was a kind of obligation to the sacredness of money,” she wrote, “that John Rockefeller had foreclosed on his own brother.”

After chastising Rockefeller for many months, Ida produced an installment called “The Legitimate Greatness of the Standard Oil Company” in which she freely acknowledged its leader’s business efficiency. Rockefeller’s passion for detail and for plowing profits back into the company, she said, had resulted in a masterpiece of organization. Even the dust on the floors of his tin factories was sifted to save filings and bits of solder.

While granting Rockefeller his due, Ida could not forgive practices she considered illegitimate and debasing to business morality. His success, she feared, would tempt thousands of others to “Commercial Machiavellianism.” In the wake of his growing monopoly, Ida said, Rockefeller left a trail of devastated small businesses:

Why one should love an oil refinery the outsider may not see, but to the man who had begun with one still and had seen it grow by his own energy and intelligence to ten, who now sold 500 barrels a day where he once sold five, the refinery was the dearest spot on earth save his home. … To ask such a man to give up his refinery was to ask him to give up the thing which, after his family, meant most in life to him.

But faced with the growing power of Standard Oil, the independents did give up. Describing one who sold out, Ida wrote that “he realized that something … was at work in the oil business—something resistless, silent, perfect in its might—and he sold out to that something.” Along Oil Creek, she said, “the little refineries which for years had faced every difficulty with stout hearts collapsed. ‘Sold out,’ ‘dismantled,’ ‘shut down,’ is the melancholy record.”

As dramatic proof of the fierceness of the conflict Ida devoted an entire installment to “The Buffalo Case,” in which managers of a Standard affiliate in New York were convicted of conspiring to blow up a rival refinery to force it out of business. In another chapter she shocked her public by repeating the tale of Widow Backus, who declared in an affidavit that Rockefeller had fleeced her of a fair price when she sold her husband’s refinery to Standard Oil. Ida said of the widow:

She had seen every effort to preserve an independent business thwarted. Rightly or wrongly, she had come to believe that a refusal to sell meant a fight with Mr. Rockefeller, that a fight meant ultimately defeat, and she gave up her business to avoid ruin.

Historians later criticized Ida for repeating the widow’s tale, which was of questionable accuracy, but true or exaggerated, it made a sensational installment. Victorian ladies of comfortable means could identify with the plight of Widow Backus.

Acknowledged as “Lord of the Oil Regions” by 1879, Rockefeller controlled 90 per cent of the oil business of the nation, dominating refining, transporting, and marketing. The entire pipeline system of the Pennsylvania fields belonged to Standard. Rockefeller had achieved his goal, Ida wrote, “because he had the essential element to all great achievement, a steadfastness to purpose once conceived which nothing can crush.”

To handle the affairs of his giant monopoly, Rockefeller created a new type of business organization, the trust, whereby he and eight other trustees managed the entire structure. But public resentment against the monopoly began to be reflected in a rash of legal suits. Ida reminded her readers of the 1892 ruling by the supreme court of Ohio that had resulted in dissolution of the Standard Oil Trust. It was replaced by the Standard Oil Company of New Jersey, which functioned as a holding company for the Rockefeller interests.
After eighteen chapters and almost four years of research and writing Ida and McClure’s rested their case against John D. Rockefeller. Summing it all up, Ida told her faithful readers that they were paying more for oil under monopoly conditions than they would pay under free competition. Business opportunity in the oil industry, she said, was now limited to a few hundred men.

But there was a more serious side to it, she concluded. The ethical cost of all this should be a deep concern. “Canonize ‘business success,’ and men who make a success like that of the Standard Oil Trust become national heroes!” Defenders of Rockefeller might justify his methods by saying, “It’s business” or “All humans are erring mortals,” but Ida would not accept a moral code that “would leave our business men weeping on one another’s shoulders over human frailty, while they picked one another’s pockets.”
In a last plea to her readers she urged them to ostracize monopolists who used unethical practices as they would ostracize unethical doctors, lawyers, or athletes, for “a thing won by breaking the rules of the game,” she moralized, “is not worth the winning.”

As her public exploded with wrath, McClure’s was deluged with angry letters. Ida, readers said, was a modern Joan of Arc and “the Terror of the Trusts.” Her study reminded one man of “the clarion notes of the old prophets of Israel.” Another called it “the Uncle Tom’s Cabin of today.” A letter addressed to “Ida M. Tarbell, Rockefeller Station, Hades,” reached her promptly.

McClure’s, packed with articles by Steffens and Baker as well as with Ida’s literary dynamite, thrived on its crusading zeal. But Ida was even more of a celebrity than her colleagues, and they joined in the general admiration for her work. “Ida Tarbell was the best of us,” Baker admitted. In a western city a newspaper hailed the arrival of William Allen White and Ida with the headline “Celebrated Writers Here.” S. S. wrote his protegee: “You are today the most generally famous woman in America.”

Ida’s “History” evoked even more praise when it was published as a two-volume book in 1904. “Miss Tarbell,” said the Cleveland Leader , “has done more to dethrone Rockefeller in public esteem than all the preachers in the land.” The New York News declared that “Rockefeller’s very conscience is exposed by her search for truth.” The Norfolk Dispatch and the Washington News proclaimed Ida “a great woman historian” and “probably the most talented woman writer of history that this country has produced.”

Standard, however, was not without its defenders. In Pennsylvania the Oil City Derrick , subsidized by the company, headlined its review: “Hysterical Woman Versus Historical Facts.” A Harvard economist, Gilbert Montague, who wrote a sympathetic history of Standard’s operations, termed Ida “a mere gatherer of folklore.” The popular essayist Elbert Hubbard said Standard Oil was an example of “survival of the fittest” and called Ida a “literary bushwhacker” who “shot from cover and … shot to kill.” The nickname Miss Tarbarrel was coined by Standard supporters. Even Rockefeller himself, not a notably humorous man, adopted the pun with glee.

While interest in Ida’s history was at its height, new oil discoveries by wildcatters drilling deep in the Kansas plains caused a fresh boom. Standard Oil moved quickly into the new fields, threading its pipelines across prairie and farmland. But McClure’s had reached even the remote farmers of Kansas. Populists, women’s clubs, and independent oilmen vowed to keep Standard out of their fields even if they had to set up a state-owned refinery in the penitentiary. At the urging of the oilmen Ida visited the new arena. To her dismay she was received as a prophet and serenaded by oil boomers. “But here I was,” she wrote later, “fifty, fagged, wanting to be let alone while I collected trustworthy information for my articles—dragged to the front as an apostle.”

The news from Kansas, added to the cumulative effect of the Tarbell series, helped stir Congress to action. In February, 1905, it authorized the Bureau of Corporations to investigate the low price of crude oil, particularly in Kansas. Could the wide margin between the prices of crude and refined, a Kansas congressman asked, be attributed to the operations of a trust or conspiracy?

Enthusiastically the Bureau of Corporations dug into its assignment. In the first of three lengthy reports to Congress, it concluded that Standard “habitually” received and was still receiving secret rebates and other “unjust and illegal discriminations” from railroads. The second report charged that Standard controlled the only major pipeline serving the oil industry and that it fought would-be competitors with lawsuits, right-of-way disputes, aid to railroads, and price wars. The final report accused Standard of keeping oil prices artificially high at the expense of the American consumer. Commissioner Herbert Knox Smith called for prosecution of Standard under the Sherman Antitrust Act.

The bureau’s findings were not news to Ida’s readers. One cartoonist pictured President Roosevelt receiving the reports on a slate bearing these words: “Standard Oil is just as naughty as Ida said it was.” In the background of the cartoon was Henry Rogers, muttering to Rockefeller: “And I had my fingers crossed too.”
But Roosevelt, who had originally encouraged federal legal action against Standard, became exasperated at the public vogue for the literature of exposure as other magazines and writers rushed to copy McClure’s successful formula. Shortly after the appearance of an article in Cosmopolitan titled “The Treason of the Senate” an angry Roosevelt applied the term “muckrakers” to responsible and irresponsible journalists alike. Pondering the President’s attack years later, Ida decided that Teddy preferred to conduct trust busting on his own and resented writers “stealing his thunder.”

Meanwhile, Standard’s troubles were multiplying. Three antitrust suits were brought against the corporation in state courts in 1904, four in 1905, and fourteen in 1906. Many resulted in fines or the temporary ouster of Standard from a state. The most sensational fine, $29,240,000 for 1,462 violations of the Elkins Act forbidding acceptance of rebates, was handed down by Judge Kenesaw Mountain Landis in August, 1907. Although this decision was later reversed, the “Big Fine” made Judge Landis famous and added drama to the controversy.

Once when Ida was searching for material in Indiana and Ohio, an order went out from Standard headquarters: “Simply ignore her entirely.” But in the face of such mounting hostility even Standard Oil could not play the sphinx forever. The company began to give out information on its operations and employed Ivy Ledbetter Lee, an early public relations counsel, to place advertisements and friendly stories in newspapers and magazines. It ordered five thousand copies of Montague’s book and distributed them to employees, ministers, libraries, teachers, and prominent citizens.

Rockefeller’s own image was under such attack that a group of Congregational ministers balked at accepting his gift of $100,000 to their board of missions, calling it “tainted money.” Later, to their embarrassment, they found that some of their colleagues had actually requested the gift. But the term “tainted money” briefly captured many a headline. Undeterred, Rockefeller intensified his long habit of philanthropy. Two months after the final chapter of the Standard Oil history appeared in McClure’s , he announced gifts of one million dollars to Yale University and ten times that amount to the General Education Board, a philanthropy in aid of higher education that he had helped to establish two years before. No one objected. Such sums, the New York Sun commented dryly, “deodorize themselves.” When it was charged that Rockefeller was using philanthropy to silence criticism, Ida came to his defense, reminding critics that Rockefeller had been a steady giver to church and charity since boyhood. If his gifts were larger now, she pointed out, it was because his income was greater and perhaps because he sought to call public attention to the benefits reaped from Standard Oil.

John D. proved his own most effective advocate. In 1909 he published a slim book titled Random Reminiscences of Men and Events. Although he did not mention Ida or other critics by name, it was obvious the outcry was on Rockefeller’s mind. “Just how far one is justified … in defending himself from attacks is a moot point,” he wrote. Random Reminiscences, an informal account of the early career, principles, and recreations of the nation’s richest man, also contained useful hints on how to give money away wisely. This little book, one Rockefeller biographer has said, “did more to make Rockefeller a human figure than tons of Sunday supplement articles.”

Random Reminiscences, however, did not persuade the federal government to call off a suit charging Standard Oil with violation of the Sherman act. The case dragged through three and a half years of litigation. In 1909 a federal circuit court sustained the government’s position, but Standard appealed to the Supreme Court. Many an editor invited Ida to analyze the testimony. “I could have made a good killing out of that long investigation …” she recalled later. “But I had no stomach for it.” Weary of all the controversy, she wished only “to escape into the safe retreat of a library where I could study people long dead.”

Finally, on May 15, 1911, the decision was handed down. The highest court in the land declared Standard Oil of New Jersey to be a monopoly in restraint of trade, based on unfair practices. Charging that Standard’s object was “to drive others from the field and exclude them from their right to trade,” the court ordered the holding company dissolved. The justices, in effect, agreed with Ida.

“The History of the Standard Oil Company” was probably the most sensational serial ever to appear in an American magazine. Allan Nevins, in his biography of Rockefeller, called it “the most spectacular success of the muckraking school of journalism, and its most enduring achievement.” As a historian Ida Tarbell had her flaws. She was untrained in economics. She yearned to turn back the clock to an era of individualism in business. She was obviously partial to independent oilmen, even though she scolded them for lacking the patience and fortitude to organize effectively against Rockefeller. In her indignation she sometimes exaggerated the iniquity of her archvillain.

But at a time when strong men quailed before the Rockefeller reputation, this daughter of the oil regions, fortified by her sense of righteous morality, boldly voiced their feelings. Although small operators lost their struggle for existence, Ida carried the day in the contest for public opinion. A modern-day historian of the muckraking era, David M. Chalmers, believes the image she fashioned of Rockefeller as a “cunning, “ruthless Shylock” has not been successfully erased by a half century of Rockefeller family philanthropy. Forty years after her serial appeared, Time magazine credited the McClure’s articles with bringing in a “gusher of public resentment that flowed all the way to the U. S. Supreme Court.”

Was Ida’s study an accurate work of historical research, or was it a subjective attack on practices of which she disapproved? Modern business historians, looking back on the “History” with the hindsight of a later era, generally substantiate her charges that Standard Oil built its monopoly upon special favors from railroads, mastery of the pipeline system, and sharp marketing practices, all of which helped force small independents out of the fields and refineries.

But Ida raised a larger question: Was it better for the American oil industry to have free, albeit cutthroat, competition, or to fall under the dominance of a monopoly with the power to maintain orderly production and a profitable, if higher, price structure? It is this aspect of her account that still arouses controversy. Social historians tend to be on Ida’s side, business historians to defend Rockefeller; both schools agree, however, that Ida was a pioneer business historian and that, although she worked with the crude research tools of the early 1900’s and became a special pleader for her own moralistic ideas of business ethics, she presented a remarkably clear and truthful picture of the rise of Standard Oil.

Though John D. Rockefeller never met the stern spinster who judged his business morality so harshly, she and Rockefeller’s son, John D., Jr., did meet at a conference called by President Wilson after World War I. The younger Rockefeller, who had once compared Standard Oil to an American Beauty rose, had become disenchanted and had made “one of the most important decisions of my life.” Resigning his directorships in Standard Oil and U. S. Steel, he announced in 1910 that he would devote his life to giving away the immense sums of money that flowed from his father’s business creation.

When John D., Jr., realized he was to meet Ida, he sought the advice of William Allen White. The famous Kansas editor knew the younger Rockefeller as a gentle and kindhearted person for whom Ida’s book had been “an unpleasant fact which gave him something more than pause.” He advised Rockefeller to meet Miss Tarbell casually and naturally; as two sensitive people they would bridge the awkward situation. After the meeting White saw John D., Jr., hurrying into the street to hail a cab for Miss Tarbell. Later he was amused to see them, placed together by some inspired host at a formal dinner, “chatting amiably … each trying to outdo the other in politeness.”

Although Ida wrote many other books and articles, none of her later works had the impact of the Standard Oil history. In 1922 she tried to revive her interest and write a third volume on Standard. But the fire and the burning indignation that had caught a nation’s attention were gone. “Repeating yourself,” she decided, “is a doubtful practice.”

In 1937, as Ida at eighty was writing her autobiography, John D. Rockefeller died at the age of ninety-seven. The lady who had been his nemesis lived seven more years, enjoying the tranquillity of her Connecticut farm, where she made jelly and raised peonies, lettuce, and potatoes. An interviewer who sought her out in this retreat found her characteristically self-effacing: “The proof that I am able to do anything so worthwhile as raise a potato never fails to thrill me,” said the Terror of the Trusts.

Wednesday, February 6, 2013

Economics During and After the Industrial Revolution

Hello! Here is a podcast about economics during and after the Industrial Revolution. It is really entertaining, and I have put the link below so you can listen to it.


Concepts

Here are some concepts explained in the podcast:

laissez-faire capitalism: When transactions between private parties are free of tariffs, enforced monopolies, subsidies, etc.

free market: An structure in which the price is directly controlled by the law of supply and demand, in which the government doesn't interfere.

law of supply and demand: The law of supply and demand refers to the increase or decrease of the price depending on how much you have of a "something" and how much do people ask for that "something."

law of self-interest: It states that even if a person acts for other people's interests, the ultimate interest of that person is its own.

law of competition: Monopolies aren't good for society, because when there is competition the different parts want to improve their quality or decrease prices, but when there is only one part they can be lazy on quality and establish the price they want.

the invisible hand: Each individual strives to become wealthy "intending only his own gain" but to this end he must exchange what he owns or produces with others who sufficiently value what he has to offer

contract: A legal document that establishes that a trade has been made, which must be signed by both parts.

free trade: When a person or company is allowed to trade with other countries without the need of paying taxes or having quotas.

balance of trade: The balance between the imports and exports, or between costs and profits.

zero-sum game: It refers to when the wins and loses of a trade are exactly the same, so there's no progress nor lost.

protectionism: An economic posture for protecting the country's economy by applying tariffs and quotes to international business.

embargo: When trade with an specific country is totally or partially prohibited by the government of another country.

quota: Putting a limit to the quantity of international trade.

tariff: A special tax applied for importing goods from other countries

comparative advantage: The ability of a party to produce a particular good or service at a lower marginal and opportunity cost over another.

trading partner: One of the participants in a business ongoing relationship.

niche product:    a product that is made and marketed for use in a small and specialized 
  but profitable market

specialization: When a company works the most in a certain product and becomes the best or one of the best distributors of the product.

life expectancy: The average life span of a community of people in a certain territory. E.g. In Japan, the life expectancy is of 82.73 years.

birth rate: Birth rate is the number of births over some time in a certain human community.

replacement rate: It refers to the comparison of the deaths and births of a population in a period of time

carrying capacity: The maximum population size a city can support, according to food, health care, birth rates, sanitation, etc.

utilitarianism: Tries to maximize utility, reducing suffering and maximizing happiness.