John D Rockefeller Classic Autobiography Random Reminiscences of Men and Events AUDIOBOOK FULL

John D Rockefeller Classic Autobiography Random Reminiscences of Men and Events AUDIOBOOK FULL


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chapter 1 of random reminiscences of men and events by john d rockefeller this is a librivox recording all librivox recordings are in the public domain for more information or to volunteer please visit recording by william tomco random reminiscences of men and events by john d rockefeller chapter one
some old friends since these reminiscences are really what they profess to be random and informal i hope i may be pardoned for setting down so many small things and looking back over my life the impressions which come most vividly to my mind are mental pictures of my old associates and speaking of these friends in this chapter i would not have it thought that many others of whom i have not spoken were less important to me and i shall hope to refer to the subject
of my early friends in a later chapter it is not always possible to remember just how one first met an old friend or what one's impressions were but i shall never forget my first meeting with mr john d archbold who is now a vice president of the standard oil company at that time say 35 or 40 years ago i was traveling about the country visiting the point where something was happening talking with producers the refiners the agents and actually getting acquainted
one day there was a gathering of the men somewhere near the oil regions and when i came to the hotel which was full of oil men i saw this name writ large on the register john d archbold four dollars a barrel he was a young and enthusiastic fellow so full of his subject that he added his slogan four dollars a barrel after his signature on the register that no one might misunderstand his convictions the battle cry of four dollars a barrel was all the more striking
because crude oil was selling then for much less and this campaign for a higher price certainly did attract attention it was much top good to be true but if mr archbold had to admit in the end that crude oil is not worth four dollars a barrel his enthusiasm his energy and his splendid power over men have lasted he has always had a well-developed sense of humor and on one serious occasion when he was on the witness stand he was asked by the opposing lawyer
mr archbold are you a director of this company i am what is your occupation in this company he promptly answered to clamor for dividends which led the learned council to start afresh on another line i can never cease to wonder at his capacity for hard work i do not often see him now for he has great affairs on his hands while i live like a farmer away from active happenings in business playing golf planting trees and yet i am so busy
that no day is long enough speaking of mr archbold leads me to say again that i have received much more credit than i deserve in connection with the standard oil company it was my good fortune to help to bring together the efficient men who are the controlling forces of the organization and to work hand in hand with them for many years but it is they who have done the hard tasks the great majority of my associations were made so many years ago that i have reached the age when hardly a month goes by
sometimes i think hardly a week that i am not called upon to send some message of consolation to a family with whom we have been connected and who have met with some fresh bereavement only recently i counted up the names of the early associates who have passed away before i had finished i found the list numbered some 60 or more they were faithful and earnest friends we had worked together through many difficulties and had gone through many severe trials together
we had discussed and argued and hammered away at questions until we came to agree and it has always been a happiness to me to feel that we had been frank and above board with each other without this business associates cannot get the best out of their work it is not always the easiest of tasks to induce strong forceful men to agree it has always been our policy to hear patiently and discuss frankly until the last short of evidence is on the table before trying to reach a conclusion and
to decide finally upon a course of action in working with so many partners the conservative ones are apt to be in the majority and this is no doubt a desirable thing when the mere momentum of a large concern is certain to carry it forward the men who have been very successful are correspondingly conservative since they have much to lose in case of disaster but fortunately there are also the aggressive and more daring ones and they are usually the youngest in the company perhaps
few in number but impetuous and convincing they want to accomplish things and to move quickly and they don't mind any amount of work or responsibility i remember in particular an experience when the conservative influence met the progressive shall i say or the daring side at all events this was the side i represented in this case arguments versus capital one of my partners who had successfully built up a large and prosperous business
was resisting with all his force a plan that some of us favored to make some large improvements the cost of extending the operations of this enterprise was estimated at quite a sum three million dollars i think it was we had talked it over and over again and with several other associates discussed all the pros and cons and we had used every argument we could command to show why the plan would not only be profitable but was indeed necessary to maintain the lead we had
our old partner was obdurate he had made up his mind not to yield and i can see him standing up in his vigorous protest with his hands in his pockets his head thrown back as he shouted no it's a pity to get a man into a place in an argument where he is defending a position instead of considering the evidence his calm judgment is apt to leave him and his mind is for the time being closed and only obstinacy remains now these improvements had to be made as
i said before it was essential yet we could not quarrel with our old partner but a minority of us had made up our minds that we must try to get him to yield and we resolved to try another line of argument and said to him you say that we do not need to spend this money no he replied it will probably prove to be many years before such a sum must be spent there is no present need for these facilities you want to create and the works are doing well as they are let's let well enough alone
now our partner was a very wise and experienced man older and more familiar with the subject than some of us and all this we admitted to him but we had made up our minds as i have said to carry out this idea if we could possibly get his approval and we were willing to wait until then as soon as the argument had calmed down and when the heat of our discussion had passed the subject was brought up again i had thought of a new way to approach it i said i'll take it and supply this
capital myself if the expenditure turns out to be profitable the company can repay me and if it goes wrong i'll stand the loss that was the argument that touched him all his reserve disappeared and the matter was settled when he said if that's the way you feel about it we'll go it together i guess i can take the risk if you can it is always i presume a question in every business just how fast it is wise to go and we went
pretty rapidly in those days building and expanding in all directions we were being confronted with fresh emergencies constantly a new oil field would be discovered tanks for storage had to be built almost overnight and this was going on when old fields were being exhausted so we were therefore often under the double strain of losing the facilities in one place where we were fully equipped and having to build a plant for storing and transporting in a new field where we were totally unprepared these
are some of the things which make the whole oil trade a perilous one but we had with us a group of courageous men who recognize the great principle that a business cannot be a great success that does not fully and efficiently accept and take advantage of its opportunities how often we discuss those trying questions some of us wanted to jump at once into big expenditures and others to keep to more moderate ones it was usually a compromise but one at a time we took these matters up and settled them
never going as fast as the most progressive ones wished nor quite so carefully as the conservatives desired but always made the vote unanimous in the end the joy of achievement the part played by one of my earliest partners mr h m flagler was always an inspiration to me he invariably wanted to go ahead and accomplish great projects of all kinds he was always on the active side of every question and to his wonderful energy is due much of
the rapid progress of the company in the early days it was to be expected of such a man that he should fulfill his destiny by working out some great problems at a time when most men want to retire to a comfortable life of ease this would not appeal to my old friend he undertook single-handed the task of building up the east coast of florida he was not satisfied to plan a railroad from saint augustine to key west a distance of more than 600 miles which would have been regarded as an
undertaking large enough for almost any one man but in addition he has built a chain of superb hotels to induce tourists to go to this newly developed country further than this he has had them conducted with great skill and success this one man by his own energy and capital has opened up a vast stretch of country so that the old inhabitants and the new settlers may have a market for their products he has given work to thousands of these people and to crown all he has undertaken
and nearly completed a remarkable engineering feat in carrying his road on the florida keys into the atlantic ocean to key west the point set out four years ago practically all this has been done after what most men would have considered a full business life and a man of any other nationality situated as he was would have retired to enjoy the fruits of his labor i first knew mr flagler as a young man who consigned produce to clark and rockefeller
he was a bright and active young fellow full of vim and push about the time we went into the oil business mr flagler established himself as a commission merchant in the same building with mr clark who took over and succeeded the firm of clark and rockefeller a little later he bought out mr clark and combined his trade with his own naturally i came to see more of him the business relations which began with the handling of produce he consigned to our old firm grew into a business friendship because
people who lived in a comparatively small place as cleveland was then were thrown together much more often than in such a place as new york when the oil business was developing and we needed more help i had once thought of mr flagler as a possible partner and made him an offer to come with us and give up his commission business this offer he accepted and so began that lifelong friendship which has never had a moment's interruption it was a friendship founded on business which mr flagler used to say
was a good deal better than a business founded on friendship and my experience leads me to agree with him for years and years this early partner and i worked shoulder to shoulder our desks were in the same room we both lived on euclid avenue a few rods apart we met and walked to the office together walked home to luncheon back again after luncheon and home again at night on these walks when we were away from the office interruptions we did our thinking talking and planning
together mr flagler drew practically all our contracts he has always had the faculty of being able to clearly express the intent and purpose of a contract so well and accurately that there could be no misunderstanding and his contracts were fair to both sides i can remember his saying often that when you go into an arrangement you must measure up the rights and proprieties of both sides with the same yardstick and this was the way henry m flagler did
one contract mr flagler was called upon to accept which to my surprise he had once passed with his okay and without a question we had concluded to purchase the land on which one of our refineries was built and which was held on a lease from john irwin whom we both knew well mr irwin drew the contract for the purchase of this land on the back of a large manila envelope that he picked up in the office the description of the property ran as such contracts usually do until it came to the phrase the line
runs south to a mullen stock etc this seemed to me a trifle indefinite but mr flagler said it's all right john i'll accept that contract and when the deed comes in you will see that the mullen stock will be replaced by a proper stake and the whole document will be accurate and ship shape of course it turned out exactly as he said it would i am almost tempted to say that some lawyers might sit at his feet and learn things about drawing contracts good for
them to know but perhaps our legal friends might think i was partial so i won't press the point another thing about mr flagler for which i think he deserves great credit was that in the early days he insisted that when a refinery was to be put up it should be different from the flimsy shacks which it was then the custom to build everyone was so afraid that the oil would disappear and that the money expended in buildings would be a loss that the meanest and cheapest buildings were erected
for use as refineries this was the sort of thing mr flagler objected to while he had to admit that it was possible the oil supply might fail and that the risks of the trade were great he always believed that if we went into the oil business at all we should do the work as well as we knew how then we should have the very best facilities that everything should be solid and substantial and that nothing should be left undone to produce the finest results and he followed his convictions of building as though the trade was going to last
and this courage and acting up to his beliefs laid strong foundations for later years there are a number of people still alive who will recall the bright straightforward young flagler of those days with satisfaction at the time when we bought certain refineries at cleveland he was very active one day he met an old friend on the street a german baker to whom he had sold flower in years gone by his friend told him that he had gone out of the bakery business and had built a little refinery this
surprised mr flagler and he didn't like the idea of his friend investing his little fortune in a small plant which he felt sure would not succeed but at first there seemed nothing to do about it he had it on his mind for some days it evidently troubled him finally he came to me and said that little baker man knows more about baking than oil refining but i'd feel better if we invited him to join us i've got him on my conscience i of course agreed he talked to his friend
who said he would gladly sell if we would send an appraiser to value his plant which we did and then there arose an unexpected difficulty the price at which the plant was to be purchased was satisfactory but the ex baker insisted that mr flagler should advise him whether he should take his pay in cash or standard oil certificates at par he told mr flagler that if he took it in cash it would pay all his debts and he would be glad to have his mind free of many anxieties but if mr flagler said the certificates
were going to pay good dividends he wanted to get into and keep up with a good thing it was rather a hard proposition to put up to mr flagler and at first he declined to advise or express any opinion but the german stuck to him and wouldn't let him shirk a responsibility which in no way belonged to him finally mr flagler suggested that he take half the amount in cash and pay 50 percent on account of his debts and put the other half in certificates
and see what happened this he did and as time went on he bought more certificates and mr flagler never had to apologize for the advice he gave him i am confident that my old partner gave this affair as much time and thought as he did to any of his own large problems and the incident may be taken as a measure of the man the value of friendships but these old men's tales can hardly be interesting to the present generation though perhaps they will not be useless
if even tiresome stories make young people realize how above all other possessions is the value of a friend in every department of life without any exception whatsoever how many different kinds of friends there are they should all be held close at any cost four although some are better than others perhaps a friend of whatever kind is important and this one learns as one grows older there is the kind that when you need help has a good reason just at the moment of
course why it is impossible to extend it i can't endorse your note he says because i have an agreement with my partners not to i'd like to oblige you but i can explain why at the moment etc etc i do not mean to criticize this sort of friendship for sometimes it is a matter of temperament and sometimes the real necessities are such that the friend cannot do as he would like to do as i look back over my friends i can remember only a few of this kind
and a good many of the more capable sort one a special friend i had his name was sv harkness and from the first of our acquaintance he seemed to have every confidence in me one day our oil warehouses and refinery burned to the ground in a few hours they were absolutely annihilated though they were insured for many hundred thousands of dollars of course we were apprehensive about collecting such a large amount of insurance and feared it might take some time to
arrange that plant had to be rebuilt right away and it was necessary to lay the financial plans mr harkness was interested with us in the business and i said to him i may want to call upon you for the use of some money i don't know that we shall need it but i thought i'd speak to you in advance about it he took in the situation without much explaining on my part he simply heard what i had to say and he was a man of very few words alright jd i'll give you all i've got
this was all he said but i went home that night relieved of anxiety as it turned out we received the check of the liverpool london and globe insurance company for the full amount before the builders require the payments and while we didn't need his money i never shall forget the whole sold way in which he offered it and this sort of experience was not i am grateful to say rare with me i was always a great borrower in my early days the business was active and growing fast and the banks seemed very willing to
loan me the money about this time when our great fire had brought up some new conditions i was studying the situation to see what our cash requirements would be we were accustomed to prepare for financial emergencies long before we needed the funds another incident occurred at this time which showed again the kind of real friends we had in those days but i did not hear the full story of it until long years after the event there was one bank where we had done a great deal of business and a friend of mine
mr stillman witt who was such a rich man was one of the directors at a meeting the question came up as to what the bank would do in case we wanted more money in order that no one might doubt his own position on the subject mr wood called for his strong box and said here gentlemen these young men are all okay and if they want to borrow more money i want to see this bank advance it without hesitation and if you want more security here it is take what you want
we were then shipping a large quantity of oil by lake and canal to safe and transportation and it took additional capital to carry these shipments and we required to borrow a large amount of money we had already made extensive loans from another bank whose president informed me that his board of directors had been making inquiries respecting our large line of discounts and had stated that they would probably want to talk with me on the subject i answered that i would be very glad of the opportunity to meet the board
as we would require a great deal more money from the bank suffice it to say we got all we wanted but i was not asked to call for any further explanations but i fear i am telling too much about banks and money and business i know of nothing more despicable and pathetic than a man who devotes all the waking hours of the day to making money for money's sake if i were 40 years younger i should like to go into business again for the association with interesting and quick-minded men
was always a great pleasure but i have no dearth of interest to fill my days and so long as i live i expect to go on and develop the plans which have been my inspiration for a lifetime during all the long period of work which lasted from the time i was 16 years old until i retired from active business when i was 55 i must admit that i managed to get a good many vacations of one kind or another because of the willingness of my most efficient associates to assume the burdens of the business
which they were so eminently qualified to conduct of detailed work i feel i have done my full share as i began my business life as a bookkeeper i learned to have a great respect for figures and facts no matter how small they were when there was a matter of accounting to be done in connection with any plan with which i was associated in the earlier years i usually found that i was selected to undertake it i had a passion for detail which afterward i was forced to strive to modify
at pokentico hills new york where i have spent portions of my time for many years in an old house where the fine views invite the soul and where we can live simply and quietly i have spent many delightful hours studying the beautiful views the trees and fine landscape effects of that very interesting section of the hudson river and this happened in the days when i seem to need every minute for the absorbing demands of business so i fear after i got well started i was not what might be called a diligent
businessman this phrase diligent in business reminds me of an old friend of mine in cleveland who was devoted to his work i talked to him and no doubt aboard him unspeakably on my special hobby which has always been what some people call landscape gardening but which with me is the art of laying out roads and paths and work of that kind this friend of 35 years ago plainly disapproved of a man in business wasting his time in what he looked upon as mere foolishness
one superb spring day i suggested to him that he should spend the afternoon with me a most unusual and reckless suggestion for a businessman to make in those days and see some beautiful paths through the woods on my place which i had been planning and had about completed i went so far as to tell him that i would give him a real treat i cannot do it john he said i have an important matter of business on hand this afternoon that may all be i urged but it will give you no such pleasure as you'll get when you
see those paths the big tree on each side and go on john with your talk about trees and paths i tell you i've got an ore ship coming in and our mills are waiting for her he rubbed his hands with satisfaction i'd not miss seeing her come in for all the wood paths in christendom he was then getting 120 to 130 a ton for bessemer steel rails and if his mill stopped a minute waiting for ore he felt that he was missing his life's
chance perhaps it was this same man who often gazed out into the lake with every nerve stretched to try to see an orship approaching one day one of his friends asked him if he could see the boat no no he reluctantly admitted but she's most in sight this or trade was of great and absorbing interest at cleveland my old employer was paid four dollars a ton for carrying ore from the marquette regions 50 years ago
and to think of the wickedness of this maker of woodland paths who in later years was moving the oar in great ships for 80 cents a ton and making a fortune at it all this reminds me of my experiences in the ore business but i shall come to that later i want to say something about landscape gardening to which i have devoted a great deal of time for more than 30 years the pleasures of road planning like my old friend others may be surprised at my claim to
be an amateur landscape architect in a small way and my family have been known to employ a great landscape man to make quite sure that i did not ruin the place the problem was just where to put the new home at pokentico hills which has recently been built i thought i had the advantage of knowing every foot of the land all the old big trees were personal friends of mine and with the views of any given point i was perfectly familiar i had studied them hundreds of times and
after this great landscape architect had laid out his plans and had driven his lines of stakes i asked if i might see what i could do with the job in a few days i had worked out a plan so devised that the roads caught just the best views at just the angles where and driving up the hill you came upon impressive outlooks and at the ending was a final burst of river hill cloud and great sweep of country to crown the hole and here i fixed my stakes to show where i suggested that the roads should run
and finally the exact place where the house should be look it all over i said and decide which plan is best it was a proud moment when this real authority accepted my suggestions as bringing out the most favorite spot for views and agreed upon the sight of the house how many miles of roads i have laid out in my time i can hardly compute but i have often kept at it until i was exhausted while surveying roads i have run the lines until darkness made it impossible
to see the little stakes and flags it is all very vain of me to tell of these landscape enterprises but perhaps they will offset the business talks which occupy so much of my story my methods of attending to business matters differed from those of most well-conducted merchants of my time and allowed me more freedom even after the chief affairs of the standard oil company were moved to new york i spent most of my summers at our home in cleveland and i do still i would come to new york
when my presence seemed necessary but for the most part i kept in touch with the business through our own telegraph wires and was left free to attend to many things which interested me among others the makings of paths the planting of trees and the setting out of little forests of seedlings of all the profitable things which develop quickly under the hand i have thought my young nurseries show the greatest yield we keep a set of account books for each place and i was amazed not long ago at the increase in value that a few
years make in growing things when we came to remove some young trees from westchester county to lakewood new jersey we plant our young trees especially evergreens by the thousand i think we have put in as many as ten thousand at once and let them develop to be used later in some of our planting schemes if we transfer young trees from pokentico to our home in lakewood we charge one place and credit the other for these trees at the market rate we are our own best customers and we
make a small fortune out of ourselves by selling to our new jersey place at a dollar fifty or two dollars each trees which originally cost us only five or ten cents at pokentico in nursery stock as in other things the advantage of doing things on a large scale reveals itself the pleasure and satisfaction of saving and moving large trees trees say from 10 to 20 inches in diameter or even more in some cases has been for years a source of great interest
we build our movers ourselves and work with our own men and it is truly surprising what liberties you can take with trees if you once learn how to handle these monsters we have moved trees 90 feet high and many 70 or 80 feet and they naturally are by no means young at one time or another we have tried almost all kinds of trees including some which the authorities said could not be moved with success perhaps the most daring experiments were with horse chestnuts
we took up large trees transported them considerable distances some of them after they were actually in flower all at a cost of twenty dollars per tree and lost very few we were so successful that we became rather reckless trying experiments out of season but when we worked on plans we had already tried our results were remarkably satisfactory taking our experiences and many hundreds of trees of various kinds in and out of season and including the time when we were learning the art
our total loss has been something less than ten percent probably more nearly six or seven percent a whole tree moving campaign in a single season has been accomplished with a loss of about three percent i am willing to admit that in the case of the larger trees the growth has been perhaps two years but this is a small matter for people no longer young wish to get the effects they desire at once and the modern tree mover does it we have grouped and arranged clumps of big spruces
to fit the purposes we were aiming for and sometimes have completely covered a hillside with them oaks we have not been successful with except when comparatively young and we don't try to move oaks and hickories when they have come near to maturity but we have made some successful experiments with basswood and one of these we have moved three times without injury birches have generally baffled us but evergreens except cedars have been almost invariably successfully handled
this planning for good views must have been an early passion with me i remember when i was hardly more than a boy i wanted to cut away a big tree which i thought interfered with the view from the windows of the dining room of our home i was for cutting it down but some other members of the family objected though my dear mother i think sympathized with me as she said one day you know my son we have breakfast at eight o'clock and i think if the tree were filled sometime before we sat down to table
there would probably be no great complaint when the family saw the view which the fallen tree revealed so it turned out end of chapter 1 recording by william tomco chapter 2 of random reminiscences of men and events by john d rockefeller this is a librivox recording all librivox recordings are in the public domain for more information or to volunteer
please visit recording by william tomco random reminiscences of men and events by john d rockefeller chapter 2 the difficult art of getting to my father i owe a great debt in that he himself trained me to practical ways he was engaged in different enterprises he used to tell me about these things explaining their significance and he taught me the principles and
methods of business from early boyhood i kept a little book which i remember i called ledger a and this little volume is still preserved containing my receipts and expenditures as well as an account of the small sums that i was taught to give away regularly naturally people of modest means lead a closer family life than those who have plenty of servants to do everything for them i counted a blessing that i was of the former class when i was seven or eight years old i engaged in my first
business enterprise with the assistance of my mother i owned some turkeys and she presented me with the curds from the milk to feed them i took care of the birds myself and sold them all in business-like fashion my receipts were all profits as i had nothing to do with the expense account and my records were kept as carefully as i knew how we thoroughly enjoyed this little business affair and i can still close my eyes and distinctly see the gentle and dignified birds walking quietly
along the brook and through the woods cautiously stealing the way to their nests to this day i enjoy the sight of a flock of turkeys and never miss an opportunity of studying them my mother was a good deal of a disciplinarian and upheld the standard of the family with a birch switch when it showed a tendency to deteriorate once when i was being punished for some unfortunate doings which had taken place in the village school i felt called upon to explain
after the whipping had begun that i was innocent of the charge never mind said my mother we have started in on this whipping and it will do for the next time this attitude was maintained to its final conclusion in many ways one night i remember we boys could not resist the temptation to go skating in the moonlight notwithstanding the fact that we had been expressly forbidden to skate at night almost before we got fairly started we heard a cry for help we found a neighbor who had broken
through the ice was in danger of drowning by pushing a pole to him we succeeded in fishing him out and restored him safe and sound to his grateful family as we were not generally expected to save a man's life every time we skated my brother william and i felt that there were mitigating circumstances connected with this particular disobedience which might be taken into account in the final judgment but this idea proved to be erroneous
starting at work although the plan had been to send me to college it seemed best at 16 that i should leave the high school in which i had nearly completed the course and go into a commercial college in cleveland for a few months they taught bookkeeping and some of the fundamental principles of commercial transactions this training though it lasted only a few months was very valuable to me but how to get a job that was the question i tramped the streets for days and weeks asking merchants and store
keepers if they didn't want a boy but the offer of my services met with little appreciation no one wanted a boy and very few showed any overwhelming anxiety to talk with me on the subject at last one man on the cleveland docks told me that i might come back after a noonday meal i was elated it now seemed that i might get a start i was in a fever of anxiety lest i should lose this one opportunity that i had unearthed
when finally at what seemed to me the time i presented myself to my would-be employer we will give you a chance he said but not a word passed between us about pay this was september 26 1855 i joyfully went to work the name of the firm was hewitt and tuttle in beginning the work i had some advantages my father's training as i have said was practical the course at the commercial college had taught me the rudiments of business
and i thus had a groundwork to build upon i was fortunate also in working under the supervision of the bookkeeper who was a fine disciplinarian and well disposed toward me when january 1856 arrived mr tuttle presented me with fifty dollars for my three months work which is no doubt all that i was worth and it was entirely satisfactory for the next year with twenty five dollars a month i kept my position learning the details and clerical work
connected with such a business it was a wholesale produce commission and forwarding concern my department being particularly the office duties just above me was the bookkeeper for the house and he received two thousand dollars a year salary in lieu of his share of the profits of the firm of which he was a member at the end of the first fiscal year when he left i assumed his clerical and bookkeeping work for which i received the salary of five hundred dollars as i look back upon this term of business apprenticeship
i can see that its influence was vitally important in its relations to what came after to begin with my work was done in the office of the firm itself i was almost always present when they talked of their affairs laid out their plans and decided upon the course of action i thus had an advantage over other boys of my age who were quicker and who could figure and write better than i the firm conducted a business with so many ramifications that this education was quite extensive
they owned dwelling houses warehouses and buildings which were rented for offices and a variety of uses and i had to collect the rents they shipped by rail canal and lake there were many different kinds of negotiations and transactions going on and with all these i was in close touch thus it happened that my duties were vastly more interesting than those of an office boy in a large house today i thoroughly enjoyed the work gradually the auditing of accounts was
left in my hands all the bills were first passed upon me and i took this duty very seriously one day i remember i was in a neighbor's office when the local plumber presented himself with a bill about a yard long this neighbor was one of those very busy men he was connected with what seemed to me an unlimited number of enterprises he merely glanced at this tiresome bill turned it to the bookkeeper and said please pay this bill as i was studying the same
plumber's bills in great detail checking every item if only for a few cents and finding it to be greatly to the firm's interest to do so this casual way of conducting affairs did not appeal to me i had trained myself to the point of view doubtless held by many young men in business today that my check on a bill was the executive act which released my employer's money from the till and was attended with more responsibility than the spending of my own funds i made up my mind that such business
methods could not succeed passing bills collecting rents adjusting claims and work of this kind brought me in association with a great variety of people i had to learn how to get on with all these different classes and still keep the relations between them and the house pleasant one particular kind of negotiation came to me which took all the skill i could muster to bring a successful end we would receive for example a shipment of marble from vermont to cleveland
this involved handling by railroad canal and lake boats the cost of losses or damage had to be somehow fixed between these three different carriers and it taxed all the ingenuity of a boy of 17 to work out this problem to the satisfaction of all concerned including my employers but i thought the task no hardship and so far as i can remember i never had any disagreement of moment with any of these transportation interests this experience in conducting all sorts
of transactions at such an impressionable age with the helping hand of my superiors to fall back upon in an emergency was highly interesting to me it was my first step in learning the principle of negotiation of which i hope to speak later the training that comes from working for someone else to whom we feel a responsibility i am sure was of great value to me i should estimate that the salaries of that time were far less than half of what is paid for equivalent positions
today the next year i was offered a salary of seven hundred dollars but thought i was worth eight hundred dollars we had not settled the matter by april and as a favorable opportunity had presented itself for carrying on the same business on my own account i resigned my position in those days in cleveland everyone knew almost everyone else in town among the merchants was a young englishman named mb clark perhaps ten years older than i who wanted to establish a business and
was in search of a partner he had two thousand dollars to contribute to the firm and wanted a partner who could furnish an equal amount this seemed a good opportunity for me i had saved up seven hundred or eight hundred dollars but where to get the rest was a problem i talked the matter over with my father who told me that he had always intended to give one thousand dollars to each of his children when they reached 21. he said that if i wish to receive my share at once instead of waiting he
would advance it to me and i could pay interest upon the sum until i was 21. but john he added the rate is 10. at that time 10 a year interest was a very common rate for such loans at the banks the rate might not have been quite so high but of course the financial institutions could not supply all the demands so there was much private borrowing at high figures as i needed this money for the partnership i gladly accepted my father's offer
and so began business as the junior partner of the new firm which was called clark and rockefeller it was a great thing to be my own employer mentally i swelled with pride a partner in a firm with four thousand dollars capital mr clark attended to the buying and selling and i took charge of the finance and the books we had once began to do a large business dealing in carload lots and cargos of produce naturally we soon needed more money to take care of the increasing trade
there was nothing to do but to attempt to borrow from a bank but with the bank lend to us the first loan i went to a bank president whom i knew and who knew me i remember perfectly how anxious i was to get that loan and to establish myself favorably with the banker this gentleman was tp handy a sweet and gentle old man well known as a high grade beautiful character for fifty years he was interested in young men
he knew me as a boy in the cleveland schools i gave him all the particulars of our business telling him frankly about our affairs what we wanted to use the money for etc etc i waited for the verdict with almost trembling eagerness how much do you want he said two thousand dollars all right mr rockefeller you can have it he replied just give me your own warehouse receipts they're good enough for me as i left that bank my elation can
hardly be imagined i held up my head think of it a bank had trusted me for two thousand dollars i felt that i was now a man of importance in the community for long years after the head of this bank was a friend indeed he loaned me money when i needed it and i needed it almost all the time and all the money he had it was a source of gratification that later i was able to go to him and recommend that he should make a certain investment in standard oil stock he agreed that he would like to do so
but he said that the sum involved was not at the moment available and so at my suggestion i turned banker for him and in the end he took out his principle with a very handsome prophet it is a pleasure to testify even at this late date to his great kindness and faith in me sticking to business principles mr handy trusted me because he believed we would conduct our young business on conservative and proper lines and i will remember about this time an example of how hard it is sometimes
to live up to what one knows as the right business principle not long after our concern was started our best customer that is the man who made the largest consignments asked that we should allow him to draw in advance on current shipments before the produce or a bill of lading were actually in hand we of course wished to oblige this important man but i as a financial member of the firm objected though i feared we should lose his business the situation seemed very serious my
partner was impatient with me for refusing to yield and in this dilemma i decided to go personally to see if i could not induce our customer to relent i had been unusually fortunate when i came face to face with men and winning their friendship and my partner's displeasure put me on my medal i felt that when i got into touch with this gentleman i could convince him that what he proposed would result in a bad precedent my reasoning in my own mind was logical and convincing
i went to see him and put forth all the arguments that i had so carefully thought out but he stormed about and in the end i had the further humiliation of confessing to my partner that i had failed i had been able to accomplish absolutely nothing naturally he was very much disturbed at the possibility of losing our most valued connection but i insisted and we stuck to our principles and refused to give the shipper the accommodation he had asked what was our surprise and gratification
to find that he continued his relations with us as though nothing had happened and did not again refer to the matter i learned afterward that an old country banker named john gardner of norwalk ohio who had much to do with our consignor was watching this little matter intently and i have ever since believed that he originated the suggestion to tempt us to do what we stated we did not do as a test and his story about our firm stand for what we regarded as sound
business principles did us great good about this time i began to go out and solicit business a branch of work i had never before attempted i undertook to visit every person in our part of the country who was in any way connected with the kind of business that we were engaged in and went pretty well over the states of ohio and indiana i made up my mind that i could do this best by simply introducing our firm and not pressing for immediate consignments i told them
that i represented clark and rockefeller commissioned merchants and that i had no wish to interfere with any connection that they had at present but if the opportunity offered we should be glad to serve them etc etc to our great surprise business came in upon us so fast that we hardly knew how to take care of it and in the first year our sales amounted to half a million dollars then and indeed for many years after it seemed as though there was no end to the money needed to carry on and
develop the business as our successes began to come i seldom put my head upon the pillow at night without speaking a few words to myself in this wise now a little success soon you will fall down soon you will be overthrown because you have got a start you think you are quite a merchant look out or you will lose your head go steady these intimate conversations with myself i am sure had a great influence on my life i was
afraid i could not stand my prosperity and try to teach myself not to get puffed up with any foolish notions my loans from my father were many our relations on finances were a source of some anxiety to me and were not quite so humorous as they seem now as i look back at them occasionally he would come to me and say that if i needed money in the business he would be able to loan some and as i always needed capital i was glad indeed to get it even at 10 interest just at the moment
when i required the money most he was apt to say my son i find i have got to have that money of course you shall have it at once i would answer but i knew that he was testing me and that when i paid him he would hold the money without its earning anything for a little time and then offer it back later i confess that this little discipline should have done me good and perhaps did but while i concealed it from him the truth is i was not particularly pleased
with his application of tests to discover if my financial ability was equal to such shocks interest at 10 percent these experiences with my father remind me that in the early days there was often much discussion as to what should be paid for the use of money many people protested that the rate of 10 percent was outrageous and none but a wicked man would exact such a charge i was accustomed to argue that money was worth what it would bring
no one would pay ten percent or five percent or eight percent unless the borrower believed that at this rate it was profitable to employ it as i was always a borrower at that time i certainly did not argue for paying more than was necessary among the most persistent and heated discussions i ever had were those with the dear old lady who kept the boarding house where my brother william and i lived when we were away from home at school i used to greatly enjoy these talks for
she was an able woman and a good talker and as she charged us only a dollar a week for board and dodging and fed us well i certainly was her friend this was about the usual price were bored in the small towns in those days where the produce was raised almost entirely on the place this estimable lady was violently opposed to loners obtaining high rates of interest and we had frequent and earnest arguments on the subject she knew that i was accustomed to make loans for my father and she was familiar with the rate
secured but all the arguments in the world did not change the rate and it came down only when the supply of money grew more plentiful i have usually found that important alterations in public opinion in regard to business matters have been of slow growth along the line of proved economic theory very rarely have improvements in these relationships come about through hastily devised legislation one can hardly realize how difficult it was to get capital for active business enterprises
at that time in the country farther west much higher rates were paid which applied usually to personal loans on which a business risk was run but it shows how different the conditions for young businessmen were then then now a nimble borrower speaking of borrowing at the banks reminds me of one of the most strenuous financial efforts i ever made we had to raise the money to accept an offer for a large business it required many hundreds of thousands of dollars
and in cash securities would not answer i received the message at about noon and had to get off on the three o'clock train i drove from bank to bank asking each president or cashier whomever i could find first to get ready for me all the funds he could possibly lay hands on i told them i would be back to get the money later i rounded up all of our banks in the city and made a second journey to get the money and kept going until i secured the necessary amount
with this i was off on the three o'clock train and closed the transaction in these early days i was a good deal of a traveler visiting our plans making new connections seeing people arranging plans to extend our business and it often called for very rapid work raising church funds when i was but 17 or 18 i was elected as a trustee in the church it was a mission branch and occasionally i had to hear members who
belong to the main body speak of the missions as though it were not quite so good as a big mother church this strengthened our resolve to show them that we could paddle our own canoe our first church was not a very grand affair and there was a mortgage of two thousand dollars on it which had been a dispiriting influence for years the holder of the mortgage had long demanded that he should be paid but somehow even the interest was barely kept up and the creditor finally threatened to
sell us out as it happened the money had been lent by a deacon in the church but notwithstanding this fact he felt that he should have his money and perhaps he really needed it anyhow he proposed to take such steps as were necessary to get it the matter came to a head one sunday morning when the minister announced from the pulpit that the two thousand dollars would have to be raised or we should lose our church building i therefore found myself at the door of the church as a congregation came and went
as each member came by i button-holed him and got him to promise to give something toward the extinguishing of that debt i pleaded and urged and almost threatened as each one promised i put his name and the amount down in my little book and continued to solicit from every possible subscriber this campaign for raising the money which started that morning after church lasted for several months it was a great undertaking to raise such a sum of money in small amounts ranging from a few cents to the more
magnificent promises of gifts to be paid at the rate of 25 or 50 cents per week the plan absorbed me i contributed what i could and my first ambition to earn more money was aroused by this and similar undertakings in which i was constantly engaged but at last the two thousand dollars was all in hand and a proud day it was when the debt was extinguished i hope the members of the mother church were properly humiliated to see how far we had gone beyond their
expectations but i do not now recall that they expressed the surprise that we flattered ourselves they must have felt the begging experiences i had at that time were full of interest i went at the task with pride rather than the reverse and i continued it until my increasing cares and responsibilities compelled me to resign the actual working out of details to others end of chapter 2 recording
by william tomco chapter 3 of random reminiscences of men and events by john d rockefeller this is a librivox recording all librivox recordings are in the public domain for more information or to volunteer please visit recording by william tomco random reminiscences of men and events by john d rockefeller chapter 3 the standard oil
company it would be surprising if in an organization which included a great number of men there should not be an occasional employee here and there who acted in connection with the business or perhaps in conducting his own affairs in a way which might be criticized even in a comparatively small organization it is well nigh impossible to restrain this occasional man who is overzealous for his own or his company's advancement to judge the character of all the members of a great organization
or the organization itself by the actions of a few individuals would be manifestly unfair it has been said that i forced the men who became my partners in the oil business to join with me i would not have been so short-sighted if it were true that i followed such tactics i ask would it have been possible to make of such men lifelong companions would they accept and remain for many years in positions of the greatest trust and finally could anyone have formed of such men if they had been so
browbeaten a group which has for all these years worked in loyal harmony with fair dealing among themselves as well as with others building up efficiency and acting in entire unity this powerful organization has not only lasted but its efficiency has increased for 14 years i have been out of business and in eight or ten years went only once to the company's office in the summer of 1907 i visited again the room at the top of the standard oil companies building
where the officers of the company and the heads of departments have had their luncheon served for many years i was surprised to find so many men who had come to the front since my last visit years ago afterward i had an opportunity to talk with old associates and many new ones and it was a source of great gratification to me to find that the same spirit of cooperation and harmony existed unchanged this practice of lunching together a hundred or more at long tables and most intimate
and friendly association is another indication of what i contend slight as it may seem to be at first thought would these people seek each other's companionship day after day if they had been forced into this relation people in such a position do not go on for long in a pleasant and congenial intimacy for years the standard oil company has developed step by step and i am convinced that it has done well its work of supplying to the people the products from petroleum at prices which have decreased as the efficiency
of the business has been built up it gradually extended its services first to the large centers and then to towns and now to the smallest places going to the homes of its customers delivering the oil to suit the convenience of the actual users this same system is being followed out in various parts of the world the company has for example three thousand tank wagons supplying american oil to towns and even small hamlets in europe its own depots and employees deliver it
in a somewhat similar way in japan china india and the chief countries of the world do you think this trade has been developed by anything but hard work this plan of selling our products direct to the consumer and the exceptionally rapid growth of the business bred a certain antagonism which i suppose could not have been avoided but the same idea of dealing with a consumer directly has been followed by others and in many lines of trade without creating so far as i recall any
serious opposition this is a very interesting and important point and i have often wondered if the criticism was centered upon us did not come from the fact that we were among the first if not the first to work out the problems of direct selling to the user on a broad scale this was done in a fair spirit and with due consideration for everyone's rights we did not ruthlessly go after the trade of our competitors and attempt to ruin it by cutting prices or instituting a spy system
we had set ourselves the task of building up as rapidly and as broadly as possible the volume of consumption let me try to explain just what happened to get the advantage of the facilities we had in manufacture we sought the utmost market in all lands we needed volume to do this we had to create selling methods far in advance of what then existed we had to dispose of two or three or four gallons of oil where one had been sold before and we could not rely upon the usual trade
channels then existing to accomplish this it was never our purpose to interfere with a dealer who adequately cultivated his field of operations but when we saw a new opportunity or a new place for extending the sale by further and effective facilities we made it our business to provide them in this way we opened many new lines in which others have shared in this development we had to employ many comparatively new men the ideal way to supply material for higher positions
is of course to recruit the men from among the youngest in the company service but our expansion was too rapid to permit this in all cases that some of these employees were overzealous in going after sales it would not be surprising to learn but they were acting in violation of the expressed and known wishes of the company but even these instances i am convinced occurred so seldom by comparison with the number of transaction we carried on that they were really the exceptions that proved the rule
every week in the year for many many years this concern has brought into this country more than a million dollars gold all from the products produced by american labor i am proud of the record and believe most americans will be when they understand some things better these achievements the development of the great foreign trade the owning of ships to carry the oil in bulk by the most economical methods the sending out of men to fight for the world's markets have cost huge sums of money and the vast capital
employed could not be raised nor controlled except by such an organization as a standard is today to give a true picture of the early conditions one must realize that the oil industry was considered a most hazardous undertaking that altogether unlike the speculative mining undertakings we hear so much of today i will remember my old and distinguished friend reverend thomas w armitage for some 40 years pastor of a great new york church warning me that it was worse than folly
to extend our plants and our operations he was sure we were running unwarranted risks that our oil supply would probably fail the demand would decline and he with many others sometimes i thought almost everybody prophesied ruin none of us ever dreamed of the magnitude of what proved to be the later expansion we did our day's work as we met it looking forward to what we could see in the distance and keeping well up to our opportunities
but laying our foundations firmly as i have said capital was most difficult to secure and it was not easy to interest conservative men in this adventurous business men of property were afraid of it though in rare cases capitalists were induced to unite with us to a limited extent if they bought our stock at all they took a little of it now and then as an experiment and we were painfully conscious that they often declined to buy new stock with many beautiful expressions of appreciation
the enterprise being so new and novel on account of the fearfulness of certain holders in reference to its success we frequently had to take stock to keep it from going begging but we had such confidence in the fundamental value of the concern that we were willing to assume this risk there are always a few men in an undertaking of this kind who would risk all under judgment of the final result and if the enterprise had failed these would have been classed as visionary adventurers and perhaps with good reason
the 60 000 men who are at work constantly in the service of the company are kept busy year in and year out the past year has been a time of great contraction but the standard has gone on with its plans unchecked and the new works and buildings have not been delayed on account of lack of capital or fear of bad times it pays its workmen well it cares for them when sick and pensions them when old it has never had any important strikes and if there is any better function of business management
than giving profitable work to employees year after year in good times and bad i don't know what it is another thing to be remembered about this so-called octopus is that there has been no water introduced into its capital perhaps we felt that oil and water would not have mixed nor in all these years has anyone had to wait for money which is standard owed it has suffered from great fires and losses but it has taken care of its affairs in such a way that it has not found it necessary to appeal to the general public
to place blocks of bonds or stock it has used no underwriting syndicates or stock selling schemes in any form and it has always managed to finance new oil field operations when called upon it is a common thing to hear people say that this company has crushed out its competitors only the uninformed could make such an assertion it has and always has had and always will have hundreds of active competitors it has lived only because it has managed its affairs well
and economically and with great vigor to speak of competition for a minute consider not only the able people who compete in refining oil but all the competition in the various trades which makes and sell byproducts a great variety of different businesses and perhaps of even more importance is a competition in foreign lands the standard is always fighting to sell the american product against the oil produced from the great fields of russia which struggles with the trade of europe and the burma oil which largely affects the market in
india in all these various countries we are met with tariffs which are raised against us local prejudices and strange customs in many countries we have to teach the people the chinese for example to burn oil by making lamps for them we pack the oil to be carried by camels or on the backs of runners in the most remote portions of the world we adapted the trade to the needs of strange folk every time we succeeded in a foreign land it meant dollars brought to this country and
every time we failed it was a loss to our nation and its workmen one of our greatest helpers has been the state department in washington our ambassadors and ministers and councils have aided to push our way into new markets to the utmost corners of the world i think i can speak thus frankly and enthusiastically because the working out of many of these great plans has developed largely since i retired from the business 14 years ago the standard has not now and never did have a royal road to
supremacy nor is it success due to any one man but to the multitude of able men who are working together if the present managers of the company were to relax efforts allow the quality of their product to degenerate or treat their customers badly how long would their business last about as long as any other neglected business to read some of the accounts of the affairs of the company one would think that it had such a hold on the oil trade that the directors did little but come together and declare dividends
it is a pleasure for me to take this opportunity to pay tribute to the work these men are doing not only for the company they serve but for the foreign trade of our country for more than half of all the product that the company makes is sold outside of the united states if in place of these directors the business were taken over and run by anyone but experts i would sell my interest for any price i could get to succeed in a business requires the best and most earnest men to manage it and the best men rise to the top of its
origin and early plans i will speak later the modern corporation beyond question there is a suspicion of corporations there may be reason for such suspicion very often for a corporation may be moral or immoral just as a man may be moral or the reverse but it is folly to condemn all corporations because some are bad or even to be unduly suspicious of all because some are bad but the corporation
in form and character has come to stay that is a thing that may be dependent upon even small firms are becoming corporations because it is a convenient form of partnership it is equally true that combinations of capital are bound to continue and to grow and this need not alarm even the most timid if the corporation or the series of corporations is properly conducted with due regard for the rights of others the day of individual competition in large affairs is passed and gone
you might just as well argue that we should go back to hand labor and throw away our efficient machines and the sober good sense of the people will accept this fact when they have studied and tried it out just see how the list of stockholders in the great corporations is increasing by leaps and bounds this means that all these people are becoming partners in great businesses it is a good thing it will bring a feeling of increased responsibility to the managers of the corporations and will make the people who have their interests involved
study the facts impartially before condemning or attacking them on this subject of industrial combinations i have often expressed my opinions and as i have not changed my mind i am not averse to repeating them now especially as a subject seems again to be so much in the public eye the chief advantages from industrial combinations are those which can be derived from a corporation of persons and aggregation of capital much that one man cannot do alone
two can do together and once admit the fact that cooperation or what is the same thing combination is necessary on a small scale the limit depends solely upon the necessities of business two persons in partnership may be a sufficiently large combination for a small business but if the business grows or can be made to grow more persons and more capital must be taken in the business may grow so large that a partnership ceases to be a proper instrumentality for its purposes
and then a corporation becomes a necessity in most countries as in england this form of industrial combination is sufficient for a business call extensive with a parent country but it is not so in america our federal form of government making every corporation created by a state foreign to every other state renders it necessary for persons doing business through corporate agency to organize corporations in some or many of the different states in which their business is located
instead of doing business through the agency of one corporation they must do business through the agencies of several corporations if the business is extended to foreign countries and americans are not today satisfied with home markets alone it will be found helpful and possibly necessary to organize corporations in such countries for europeans are prejudiced against foreign corporations as are the people of many of our states these different corporations thus become cooperating agencies in the same
business and are held together by common ownership of their stocks it is too late to argue about advantages of industrial combinations they are a necessity and if americans are to have the privilege of extending their business in all the states of the union and into foreign countries as well they are a necessity on a large scale and require the agency of more than one corporation the dangers are that the power conferred by combination may be abused that combinations may be
formed for speculation in stocks rather than for conducting business and that for this purpose prices may be temporarily raised instead of being lowered these abuses are possible to a greater or less extent in all combinations large or small but this fact is no more of an argument against combinations than the fact that steam may explode is an argument against steam steam is necessary and can be made comparatively safe combination is necessary and its abuses can be minimized
otherwise our legislators must acknowledge their incapacity to deal with the most important instrument of industry in the hearing of the industrial commission in 1899 i then said that if i were to suggest any legislation regarding industrial combinations it would be first federal legislation under which corporations may be created and regulated if that be possible second in lieu thereof state legislation as nearly uniform as possible
encouraging combinations of persons and capital for the purpose of carrying on industries but permitting state supervision that of a character to hamper industries but sufficient to prevent frauds upon the public i still feel as i did in 1899 the new opportunities i am far from believing that this will adversely affect the individual the great economic era we are entering will give splendid opportunity to the young man of the future one often hears the men of this new
generation say that they do not have the chances that their fathers and grandfathers had how little they know of the disadvantages from which we suffered in my young manhood we had everything to do and nothing to do it with we had to hew our own paths along new lines we had a little experience to go on capital was most difficult to get credits were mysterious things whereas now we have a system of commercial ratings everything was then haphazard and we
suffered from a stupendous war and all the disasters which followed compare this day with that our comforts and opportunities are multiplied a thousand-fold the resources of our great land are now actually opening up and are scarcely touched our home markets are vast and we have just begun to think of the foreign peoples we can serve the people who are years behind us in civilization in the east a quarter of the human race is just awakening the men of this generation are entering
into a heritage which makes their father's lives look poverty-stricken by comparison i am naturally an optimist but when it comes to a statement of what our people will accomplish in the future i am unable to express myself with sufficient enthusiasm there are many things we must do to attain the highest benefit from all these great blessings and not the least of these is to build up our reputation throughout the whole world the great business interests will i hope so comport themselves that
foreign capital will consider it a desirable thing to hold shares in american companies it is for americans to see that foreign investors are well and honestly treated so that they will never regret purchases of our securities i may speak thus frankly because i am an investor in many american enterprises but a controller of none with one exception and that a company which has not been much of a dividend payer and i like all the rest am dependent upon the honest
and capable administration of the industries i firmly and sincerely believe that they will be so managed the american businessman you hear a good many people of pessimistic disposition say much about greed and american life one would think to hear them talk that we were a race of misers in this country to lay too much stress upon the reports of greed in the newspapers would be folly since their function is to report the unusual and even the abnormal
when a man goes properly about his daily affairs the public prince say nothing it is only when something extraordinary happens to him that he is discussed but because he is thus brought into prominence occasionally you surely would not say that these occasions represented his normal life it is by no means for money alone that these active-minded men labor they are engaged in a fascinating occupation the zest of the work is maintained by something better than the mere accumulation of money
and as i think i have said elsewhere the standards of business are high and are getting better all the time i confess i have no sympathy with the idea so often advanced that our basis of all judgments in this country is founded on money if this were true we should be a nation of money hoarders instead of spenders nor do i admit that we are so small-minded of people as to be jealous of the success of others it is the other way about we are the most extraordinarily ambitious and
the success of one man in any walk of life spurs the others on it does not sour them and it is a liable even to suggest so great a meanness of spirit in reading the newspapers where so much is taken for granted in considering things on a money standard i think we need some of the sense of humor possessed by an irish neighbor of mine who built what we regarded as an extremely ugly house which stood out in bright colors as we looked from our windows my taste and architecture differed so
widely from that affected by my irish friend that we planted out the view of his house by moving some large trees to the end of our property another neighbor who watched this work going on asked mr foley why mr rockefeller moved all these big trees and cut off the view between the houses foley with a quick wit of his country responded instantly it's envy they can't stand looking at the evidence of me prosperity in my early days men acted just as they
do now no doubt when there was anything to be done for general trade betterment almost every man had some good reason for believing that his case was a special one different from all the rest for every foolish thing he did or wanted to do for every unbusiness-like plan he had he always pleaded that it was necessary in his case he was the one man who had to sell at less than cost to disrupt all the business plans of others in his trade because his individual position was so
absolutely different from all the rest it was often a heartbreaking undertaking to convince those men that the perfect occasion which would lead to the perfect opportunity would never come even if they waited until the crack of doom then again we had the type of man who really never knew all the facts about his own affairs many of the brightest kept their books in such a way that they did not actually know when they were making money on a certain operation and when they were losing this
unintelligent competition was a hard matter to contend with good old-fashioned common sense has always been a mighty rare commodity when a man's affairs are not going well he hates to study the books and face the truth from the first the men who managed a standard oil company kept their books intelligently as well as correctly we knew how much we made and where we gained or lost at least we tried not to deceive ourselves my ideas of business are no doubt old-fashioned but the fundamental principles do not
change from generation to generation and sometimes i think that our quick-witted american businessmen whose spirit and energy are so splendid do not always sufficiently study the real underlying foundations of business management i have spoken of the necessity of being frank and honest with oneself about one's own affairs many people assume that they can get away from the truth by avoiding thinking about it but the natural law is inevitable and the sooner it is recognized the better one hears a great deal about
wages and why they must be maintained at a high level by the railroads for example a laborer is worthy of his hire no less but no more and in the long run he must contribute an equivalent for what he has paid if he does not do this he is probably pauperized and you at once throw out the balance of things you can't hold up conditions artificially and you can't change the underlying laws of trade if you try you must inevitably fail all this may be trite and obvious but it
is remarkable how many men overlook what should be the obvious these are facts we can't get away from a businessman must adapt himself to the natural conditions as they exist from month to month and year to year sometimes i feel that we americans think we can find a short road to success and it may appear that often this feat is accomplished but real efficiency in work comes from knowing your facts and building upon that sure foundation
many men of wealth do not retire from business even when they can they are not willing to be idle or they have a just pride in their work and want to perfect the plans in which they have faith or what is of still more consequence they may feel the call to expand and build up for the benefit of their employees and associates and these men are the great builders up in our country consider for a moment how much would have been left undone if our prosperous american businessmen had sat down with folded hands
when they had acquired a competency i have respect for all these reasons but if a man has succeeded he has brought upon himself corresponding responsibilities and our institutions devoted to helping men to help themselves need the brain of the american businessman as well as part of his money some of these men however are so absorbed in their business affairs that they hardly have time to think of anything else if they do interest themselves in a work outside of their own office and undertake to raise money they begin
with an apology as if they are ashamed of themselves i am no beggar i have heard many of them say to which i could only reply i am sorry you feel that way about it i have been this sort of beggar all my life and the experiences i have had were so interesting and important to me that i will venture to speak of them in a later chapter end of chapter 3 recording by william tomco chapter 4 of random reminiscences of men
and events by john d rockefeller this is a librivox recording all librivox recordings are in the public domain for more information or to volunteer please visit recording by william tomco random reminiscences of men and events by john d rockefeller chapter four some experiences in the oil business during the years when i was just coming
to man's estate the produce business of clark and rockefeller went on prosperously and in the early 60s we organized a firm to refine and deal in oil it was composed of monsieur's james and richard clark mr samuel andrews and the firm of clark and rockefeller who were the company it was my first direct connection with the oil trade as a new concern grew the firm of clark and rockefeller was called upon to supply a large special capital
mr samuel andrews was a manufacturing man of the concern and he had learned the process of cleansing the crude oil by the use of sulfuric acid in 1865 the partnership was dissolved it was decided that the cash assets should be collected and the debts paid but this left the plant and the good will to be disposed of it was suggested that they should go to the highest bidder among ourselves this seemed a just settlement to me and the question came up as to when the sale should be held and who
would conduct it my partners had a lawyer in the room to represent them though i had not considered having a legal representative i thought i could take care of so simple a transaction the lawyer acted as the auctioneer and it was suggested that we should go on with the sale then and there all agreed and so the auction began i had made up my mind that i wanted to go into the oil trade not as a special partner but actively on a larger scale and with mr andrews wish to buy that
business i thought that i saw great opportunities in refining oil and did not realize at that time that the whole oil industry would soon be swamped by so many men rushing into it but i was full of hope and i had already arranged to get financial accommodation to an amount that i supposed would easily pay for the plant and goodwill i was willing to give up the other firm of clark and rockefeller and readily settled that later my old partner mr clark taking over the business
the bidding began i think at 500 premium i bid a thousand they bid 2 000 and so on little by little the price went up neither side was willing to stop bidding and the amount gradually rose until it reached fifty thousand dollars which was much more than we supposed to concern to be worth finally it advanced to sixty thousand dollars and by slow stages to seventy thousand dollars and i almost feared for my ability to buy the business and had the money to pay for it
at last the other side bid seventy two thousand dollars without hesitation i said seventy two thousand five hundred dollars mr clark then said i'll go no higher john the business is yours shall i give you a check for it now i suggested no mr clark said i'm glad to trust you for it settle at your convenience the firm of rockefeller and andrews was then established and this was really my start in the oil trade it was my most important business
for about 40 years until at the age of about 56 i retired the story of the early history of the oil trade is too well known to bear repeating in detail the cleansing of crude petroleum was a simple and easy process and at first the profits were very large naturally all sorts of people went into it the butcher the baker and the candlestick maker began to refine oil and it was only a short time before more of the finished product was put on the market than could
possibly be consumed the price went down and down until the trade was threatened with ruin it seemed absolutely necessary to extend the market for oil by exporting to foreign countries which required a long and most difficult development and also to greatly improve the process of refining so that oil could be made and sold cheaply yet with a profit and to use as byproducts all of the materials which in the less efficient plants were lost or thrown away these were the
problems which confronted us almost at the outset and this great depression led to consultations with our neighbors and friends in the business in the effort to bring some order out of what was rapidly becoming a state of chaos to accomplish all these tasks of enlarging the market and improving the methods of manufacture in a large way was beyond the power or ability of any concern as they constituted it could only be done we reasoned by increasing our capital and availing ourselves of the best
talent and experience it was with this idea that we proceeded to buy the largest and best refining concerns and centralize the administration of them with a view to securing greater economy and efficiency the business grew faster than we had anticipated this enterprise conducted by men of application and ability working hard together soon built up unusual facilities in manufacture in transportation in finance and in extending markets
we had our troubles and setbacks we suffered from some severe fires and the supply of crude oil was most uncertain our plans were constantly changed by changed conditions we developed great facilities in an oil center erected storage tanks and connected pipelines then the oil failed and our work was thrown away at best it was a speculative trade and i wonder that we managed to pull through so often but we were gradually learning how to conduct a most
difficult business foreign markets several years ago when asked how our business grew to such large proportions i explained that our first organization was a partnership and afterward a corporation in ohio that was sufficient for a local refining business but had we been dependent solely upon local business we should have failed long since we were forced to extend our markets into every part of the world this made the seaboard cities a necessary place of business
and we soon discovered that manufacturing for export could be more economically carried out there hence refineries were established at brooklyn at bayonne at philadelphia at baltimore and necessary corporations were organized in the different states we soon discovered as the business grew that the primary method of transporting oil in barrels could not last the package often cost more than the contents and the forests of the country were not sufficient to supply cheaply
the necessary material for an extended time hence we devoted attention to other methods of transportation adopted the pipeline system and found capital for pipeline construction equal to the necessities of the business to operate pipelines required franchises from the states in which they were located and consequently corporations in those states just as railroads running through different states are forced to operate under separate state charters to perfect the pipeline system of transportation required
many millions of capital the entire oil business is dependent upon the pipeline without it every well would be less valuable and every market at home and abroad would be more difficult to serve or retain because of the additional cost of the consumer the expansion of the whole industry would have been without this method of transportation then the pipeline system required other improvements such as 10 cars upon railroads and finally the tank steamer capital had to be furnished for them
and corporations created to own and operate them every one of the steps taken was necessary if the business was to be properly developed and only through such successive steps and by a great aggregation of capital is america today enabled to utilize the bounty which its land pours forth and to furnish the world with light the start of the standard oil company in the year 1867 the firms of william rockefeller and company rockefeller and andrews
rockefeller and company and s v harkness and h m flagler united informing the firm of rockefeller andrews and flagler the cause leading to the formation of this firm was a desire to unite our skill and capital in order to carry on a business of greater magnitude with economy and efficiency in place of the smaller business that each had heretofore conducted separately as time went on and the possibilities became apparent we found further capital to be necessary
then we interested others and organized the standard oil company with a capital of one million dollars later we saw that more money could be utilized found persons who were willing to invest with us and increased our capital to two million five hundred thousand dollars in 1872 and afterward in 1874 to three million five hundred thousand dollars as the business grew and markets were obtained at home and abroad more persons and capital were added to
the business and new corporate agencies were obtained or organized the object being always the same to extend our operations by furnishing the best and cheapest i ascribe the success of the standard oil company to its consistent policy of making the volume of its business large enough the merit and cheapness of its products it has spared no expense in utilizing the best and most efficient method of manufacture it has sought for the best superintendents and workmen
and paid the best wages it has not hesitated to sacrifice old machinery and old plants for new and better ones it has placed its manufactories at the points where they could supply markets at the least expense it has not only sought markets for its principal products but for all possible by-products sparing no expense in introducing them to the public in every nook and corner of the world it has not hesitated to invest millions of dollars in methods for cheapening the gathering and distribution of oils by pipelines
special cars tank steamers and tank wagons it has erected tank stations at railroad centers in every part of the country to cheapen the storage and delivery of oil it has had faith in american oil and has brought together vast sums of money for the purpose of making it what it is and for holding its market against the competition of russia and all the countries which are producers of oil and competitors against american products the insurance plans
here is an example of one of the ways in which we achieved certain economies and gained real advantage fires are always to be reckoned with in oil refining and storage as we learned by deer experience but in having our plants distributed all over the country the unit of risk and possible loss was minimized no one fire could ruin us and we were able thus to establish a system of insuring ourselves our reserve fund which provided for this insurance could not be wiped out all at once
as might be the case with the concern having its plans together or near each other then we studied and perfected our organization to prevent fires improving our appliances and plans year after year until the profit of this insurance feature became a very considerable item in the standard earnings it can easily be seen that this saving in insurance and minimizing the loss by fire affected the profits not only in refining but touched many other associated enterprises
the manufacture of by-products the tanks and steamers the pumping stations etc we devoted ourselves exclusively to the oil business and its products the company never went into outside ventures but kept to the enormous task of perfecting its own organization we educated our own men we trained many of them from boyhood we strove to keep them loyal by providing them full scope for their ability they were given opportunities to buy stock and the company itself helped them
to finance their purchases not only here in america but all over the world our young men were given chances to advance themselves and the sons of the old partners were welcomed to the councils and responsibilities of the administration i may say that the company has been in all its history and i'm sure it is at present a most happy association of busy people i have been asked if my advice is not often sought by the present managers i can say that if it were sought it would be gladly given
but the fact is that since i retired it has been very little required i am still a large stockholder indeed i have increased my holdings in the company stock since i relinquished any part in its management why this standard pays large dividends let me explain what many people perhaps fully appreciate but some i am sure do not the standard pays four dividends a year the first in march which is the result of the busiest season of the whole 12 month because more oil is consumed in
winter than it other seasons and three other dividends later at about evenly divided periods now these dividends run up to forty percent on the capital stock of one hundred million dollars but that does not mean that the profit is forty percent and the capital invested as a matter of fact it represents the results of the savings and surplus gained through all the 35 or 40 years of the workings of the companies the capital stock could be raised several hundred percent without a penny
of over capitalization or water the actual value is there if this increase had been made the rate would represent a moderate dividend paying power of about six to eight percent a normal growth study for a moment the result of what has been a natural and absolutely normal increase in the value of the company's possessions many of the pipelines were constructed during a period when costs were about 50 of what they are now great fields of
oil lands were purchased as virgin soil which later yielded an immense output quantities of low-grade crude oil which had been bought by the company when it was believed to be of little value but which the company hoped eventually to utilize were greatly increased in value by inventions for refining it and for using the residues formerly considered almost worthless doc property was secured at low prices and made valuable by buildings and development large unimproved tracks of land near the important business centers were acquired
we brought our industries to these places made the land useful and increased the value not only of our own property but of the land adjacent to it to many times the original worth wherever we have established businesses in this and other countries we have bought largely of property i remember a case where we paid only one thousand dollars or so an acre for some rough land to be used for such purposes and through the improvements we created the value has gone up 40 or 50 times as much in 35
or 40 years others have had similar increases in the value of their properties but have enlarged their capitalization correspondingly they have escaped the criticism which has been directed against us who with our old-fashioned and conservative notions have continued without such expansion of capitalization there was nothing strange or miraculous in all this it was all done through this natural law of trade development it is what the asters and many other large land holders
did if a man starts in business with one thousand dollars capital and gradually increases his property and investment by retaining in his concern much of his earnings instead of spending them and thus accumulates values until his investment is say ten thousand dollars it would be folly to base the percentage of his actual profits only on the original one thousand dollars with which he started here again i think the managers of the standard should be praised and not blamed they have set an example
for up building on the most conservative lines and in a business which has always been to say the least hazardous and to a large degree unavoidably speculative yet no one who has relied upon the ownership of this stock to pay a yearly income has been disappointed and the stock is held by an increasing number of small holders the country over the management of capital we never attempted as i have already said to sell the standard oil stock on the market
through the stock exchange in the early days the risks of the business were great and if the stock had been dealt in on the exchange its fluctuations would no doubt have been violent we prefer to have the attention of the owners and administrators of the business directed wholly to the legitimate development of the enterprise rather than to speculation in its shares the interests of the company have been carefully conserved we have been criticized for paying large dividends on a capitalization which represents but a small part of the
actual property owned by the company if we had increased the capitalization to bring it up to the real value and listed the shares on the exchange we might have been criticized then for promoting a project to induce the public to invest as i have indicated the foundations of the company were so thoroughly established and its affairs so conservatively managed that after the earlier period of struggle to secure adequate capital and in view of the trying experiences through which we then passed
we decided to pursue the policy of relying upon our own resources since then we have never been obliged to lean very heavily upon the financial public but have sought rather to hold ourselves in position not only to protect our own large and important interests but to be prepared in times of stress to lend a helping hand to others the company has suffered from the statements of people who i am convinced are not familiar with all the facts as i long ago ceased to have any active part
in the management of its affairs perhaps i may venture the opinion that men who devote themselves to building up the sale of american products all over the world in competition with foreign manufacturers should be appreciated and encouraged there have been so many tales told about the so-called speculations of the standard oil company that i may say a word about that subject this company is interested only in oil products and such manufacturing affairs as are legitimately connected there with
it has plants for the making of barrels and tanks and building pumps for pumping oil it owns vessels for carrying oil tank cars pipes for transporting oil etc etc but it is not concerned in speculative interests the oil business itself is speculative enough and this successful administration requires a firm hand and a cool head the company pays dividends to its stockholders which it earns in carrying on this oil trade this money the stockholders can and do
use as they think fit but the company is in no way responsible for the disposition that the stockholders make of their dividends the standard oil company does not own or control a chain of banks nor has it any interest directly or indirectly in any bank its relations are confined to the functions of ordinary banking such as other depositors have it buys and sells its own exchange and these dealings extending over many years have made its bills of exchange
acceptable all over the world character the essential thing in speaking of the real beginning of the standard oil company it should be remembered that it was not so much the consolidation of the firms in which we had a personal interest but the coming together of the men who had the combined brainpower to do the work which was the actual starting point perhaps it is worthwhile to emphasize again the fact that it is not merely capital and plants and the strictly material things which make up a business
but the character of the men behind these things their personalities and their abilities these are the essentials to be reckoned with late in 1871 we began the purchase of some of the more important of the refinery interests of cleveland the conditions were so chaotic and uncertain that most of the refiners were very desirous to get out of the business we invariably offered those who wanted to sell the option of taking cash or stock in the company we very much prefer to have them take
the stock because a dollar in those days looked as large as a cartwheel but as a matter of business policy we found it desirable to offer them the option and in most cases they were even precipitate in their choice of the cash they knew what a dollar would buy but they were very skeptical in regard to the possibilities of resurrecting the oil business and giving any permanent value to these shares these purchases continued over a period of years during which many of the more important
refineries at cleveland were bought by the standard oil company some of the smaller concerns however continued in the business for many years although they had the same opportunity as others to sell there were always at other refining points which were regarded as more favorably located than cleveland many refineries in successful operation the bacchus purchase all these purchases of refineries were conducted with the utmost fairness and good faith on our part
yet in many quarters the stories of certain of these transactions have been told in such form as to give the impression that the sales were made most unwillingly and only because the sellers were forced to make them by the most ruthless exertion of superior power there was one transaction this the purchase of the property of the bacchus oil company which has been variously exploited and i am made to appear as having personally robbed a defenseless widow of an extremely valuable property
paying her therefore only a mere fraction of its worth the story as told is one which makes the strongest appeal to the sympathy and if it were true would represent a shocking instance of cruelty in crushing a defenseless woman it is probable that its wide circulation and its acceptance as true by those who know nothing of the facts has awakened more hostility against the standard oil company and against me personally than any charge has been made this is my reason for
entering so much into detail in this particular case which i am exceedingly reluctant to do and for many years have refrained from doing mr f m backus a highly respected citizen of cleveland and an old and personal friend of mine had for several years prior to his death in 1874 been engaged in the lubricating oil business which was carried on after his death as a corporation known as a bacchus oil company in the latter part of 1878 our company purchased certain
portions of the property of this company the negotiations which led to this purchase extended over several weeks being conducted on behalf of mrs backus as a principal stockholder by mr charles h maher and on behalf of our company by mr peter s jennings i personally had nothing to do with the negotiations except that when the matter first came up mrs backus requested me to call at her house which i did when she spoke of selling the property to our company
and requested me to personally conduct the negotiations with her with reference to it this i was obliged to decline to do because as i then explained to her i was not familiar with the details of the business in that conversation i advised her not to take any hasty action and when she expressed fears about the future of the business stating for example that she could not get cars to transport sufficient oil i said to her that though we were using our cars and required them in our
business yet we would loan her any number she needed and do anything else in reason to assist her and i did not see why she could not successfully prosecute her business in the future as in the past i told her however that if after reflection she desired to pursue negotiations for the sale of her property some of our people familiar with the lubricating oil business would take up the question with her as she still expressed a desire to have our company buy her property negotiations were taken up by mr
jennings and the only other thing that i had to do with the matter was that when our experts reported that in their judgment the value of the works goodwill and successorship which we had decided to buy were worth a certain sum i asked them to add ten thousand dollars in order to make doubly sure that she received full value the sale was consummated as we supposed to the entire satisfaction of mrs backus and the purchase price which had been agreed upon was paid
to my profound astonishment a day or two after the transaction had been closed i received from her a very unkind letter complaining that she had been unjustly treated after investigating the matter i wrote her the following letter november 13 1878 dear madam i have held your note of the 11th inst received yesterday until today as i wish to thoroughly review every point connected with the negotiations for the purchase of the stock of the
bacchus oil company to satisfy myself as to whether i had unwittingly done anything whereby you could have any right to feel injured it is true that in the interview i had with you i suggested that if you desire to do so you could retain an interest in the business of the bacchus oil company by keeping some number of its shares and then i understood you to say that if you sold out you wish to go entirely out of the business that being my understanding our arrangements were made in case you
concluded to make the sale that precluded any other interests being represented and therefore when you did make the inquiry as to your taking some of the stock our answer was given in accordance with the facts noted above but not at all in the spirit in which you refer to the refusal in your note in regard to the reference that you make as to my permitting the business of the bacchus oil company to be taken from you i say that in this as in all else you have written in your letter of the 11th
inst you do me most grievous wrong it was but of little moment to the interests represented by me whether the business of the bacchus oil company was purchased or not i believe that it was for your interest to make the sale and have entirely candid in the statement and beg to call your attention to the time some two years ago when you consulted mr flagler and myself as to selling out your interest to mr rose at which time you were desirous of selling
at considerably less price and upon time then you have now received in cash and which sale you would have been glad to have closed if you could have obtained satisfactory security for the deferred payments as to the price paid for the property it is certainly three times greater than the cost at which we could now construct equal or better facilities but wishing to take a liberal view of it i urged the proposal of paying sixty thousand dollars which was thought much too high by some of our parties
i believe that if you would reconsider what you have written in your letter to which this is a reply you must admit having done me great injustice and i am satisfied to await upon your innate sense of right for such admission however in view of what seems to be your present feeling i now offer to restore to you the purchase made by us you simply returning the amount of money which we have invested and leaving us as though no purchase has been made should you not desire to accept this proposal i offer to you
100 200 or 300 shares of the stock at the same price that we paid for the same with this addition that if we keep the property we are under engagement to pay into the treasury of the bacchus oil company any amount which added to the amount already paid would make a total of one hundred thousand dollars and thereby make the shares one hundred dollars each that you may not be compelled to hastily come to a conclusion i will leave open for three days these propositions for your acceptance
or declination and in the meantime believe me yours very truly john d rockefeller neither of these offers was accepted in order that this may not rest on my unsupported assertion i submit the following documents the first is a letter from mr h m backus a brother of mrs backus's deceased husband who had been associated with the business and had remained with the company after his death the letter was written without any solicitation whatever on my part
but i have since received permission from mr backus to print it it is followed by extracts from affidavits made by the gentleman who conducted the negotiations on behalf of mrs backus i have no wish to reprint the complementary allusion to myself and mr bacchus's letter but have feared to omit a word of it lest some misunderstanding ensue bowling green ohio september 18 03 mr john d rockefeller cleveland ohio i do not know whether you will ever
receive this letter or not whether your secretary will throw it into the wastebasket or not but i will do my part and get it off my mind and it will not be my fault if you do not receive or read it ever since the day that my deceased brother's wife mrs f n bacchus wrote you the unjust and unreasonable letter in reference to the sale of the property of the old bacchus oil company in which i had a small interest i have wanted to write you and record my disapproval of that letter i lived with my brother's family was at
the house the day you called to talk the matter of the then proposed purchase of the property with mrs backus by her request as she told mr jennings that she wanted to deal through you i was in favor of the sale from the first i was with mrs backus all through the trouble with mr rose and with mr maloney did what i could to encourage her and to prevent mr rose from getting the best of her mrs backus in my opinion is an exceptionally good financier but she does not know and no one can
convince her that the best thing that ever happened to her financially was the sale of her interest in the bacchus oil company to your people she does not know that five more years of the then increasing desperate competition would have bankrupted the company and that with the big debt that she was carrying on the lot on euclid avenue near sheriff street she would have been swamped and that the only thing that ever saved her and the oil business generally was the plan of john d rockefeller she thinks that you literally
robbed her of millions and feeds her children on that diet three times a day more or less principally more until it has become a mania with her and no argument that anyone else can suggest will have any effect upon her she is wise and good in many ways but on that one subject she is one-sided i think of course if we could have been assured of continued dividends i would have been opposed to selling the business but that was out of the question i know of the ten thousand dollars that was
added to the purchase price of the property at your request and i know that you paid three times the value of the property and i know that all that ever saved our company from ruin was the sale of its property to you and i simply want to ease my mind by doing justice to you by saying so after the sale to your company i was simple enough to go to buffalo and try it again but soon met with defeat and retired with my flag in the dust i then went to duluth and was on the top wave till the
real estate bubble broke and i broke with it i've had my ups and downs but i have tried to take my medicine and look pleasant instead of sitting down under a juniper tree and blaming my losses to john d rockefeller i suppose i would have put off writing this letter for another year or more as i have done so long had it not been for a little chat that i had with mr hanifin superintendent of the buckeye pipeline company a day or two since when i was relating the sale etc
of the old b.o company's business and in that way revived the intention that had lain dormant since the last good resolution in regard to writing it was made but it's done now and off my mind with much respect and admiration to john d rockefeller i remain yours truly h.m backus it appears from the affidavits that the negotiations were conducted on behalf of mrs backus and her company by charles h marr who had been in the employee of the bacchus company for some
time and by mr maloney who was the superintendent of the company from the time of its organization and was also a stockholder and on behalf of the standard oil company by mr peter s jennings there has been an impression that the standard oil company purchased for seventy nine thousand dollars property which was reasonably worth much more and that the sacrifice was occasioned by threats and compulsion mr jennings requested mr maher to submit a written proposition giving the price put by the backus
company upon the several items of property and assets which it desired to sell this statement was furnished and was annexed to mr jennings affidavit the standard oil company finally decided not to purchase all of the assets of the company but only the oil on hand for which it paid the full market price amounting to about nineteen thousand dollars and the item works good will and successorship which were offered by mr mar at seventy one thousand dollars and for which the standard offered sixty
thousand dollars which was promptly accepted mr mar made affidavit as follows charles h marr being duly sworn says that in behalf of the bacchus oil company he conducted the negotiations which led to the sale of its works goodwill and stock of oils and during same when said company had offered to sell its entire stock for a gross sum to it the sum of 150 000 which was to include cash on hand accrued dividends
accounts etc said jennings requested said company to submit an itemized proposition fixing values upon different articles proposed to be sold and that he after full consideration with mrs backus and with her knowledge and consent submitted the written proposition attached to said jennings affidavit that the same is in his handwriting and was copied at the office of the american lubricating oil company from the original by himself at the request of said jennings
and said original was submitted by effiant to mrs backus that she was fully cognizant of all the details of said negotiations and the items and values attached thereto in said proposition consulted with at every step thereof none of which were taken without her advice and she was by far the largest stockholder in said bacchus oil company owning about seven tenths of said company stock and she fully approved of said proposition and accepted the offer of
seth jennings to pay sixty thousand dollars for the item works good will and successorship without any opposition so far as office knows and afan says that the amount realized from the assets of the bacchus oil company including purchase price has been about 133 000 and a part of its assets have not yet been converted into money as a fight is informed mr maher who was it will be remembered the widow's representative
refers to the negotiations leading up to the purchase and says but defiance says that nothing that was said by mr jennings or anybody else during their progress could be construed into a threat nor did anything that was said or done by said jennings hasten or push forward said trade he also says ephion says that the negotiations extended over a period of from two to three weeks and during their pendency that mrs backus frequently urged defiant to bring the same to a conclusion
as she was anxious to dispose of said business and relieve herself from further care and responsibility therewith and when the said offer of purchase by said jennings upon the terms effort said was conveyed to her by a fian she expressed herself as entirely satisfied there with mr maloney made an affidavit that he was superintendent of the bacchus oil company from the time of its organization and also a stockholder in the company and had been associated in business with
mr backus for many years previous to his death that he took part in the negotiations for the sale representing mrs backus in the matter after speaking of the negotiations he says finally after consultation the proposition was made by her to dispose of the work's goodwill and successorship for seventy one thousand dollars a few days after the proposal was made to her to pay the sum of sixty thousand dollars for works and goodwill and to take the oil on hand at
its market price which proposition she accepted and the sale was concluded during these negotiations mrs backus was anxious to sell and was entirely satisfied with the sale after it was concluded i know of the fact that about a year and a half previous she had offered to sell out the stock of the bacchus oil company at from 30 to 33 percent less than she received in the sale referred to and the value of the works and property sold had not increased in the meantime i was well
acquainted with the works of the bacchus oil company and their value i could at the time of the sale have built the works new for twenty five thousand dollars there were no threats nor intimidations nor anything of the kind used to force the sale the negotiations were pleasant and fair and the price paid in excess of the value and satisfactory to mrs backus at all concerned for her so far as i can see after more than 30 years have elapsed there was nothing but the most kindly
and considerate treatment of mrs backus on the part of the standard oil company i regret that mrs backus did not take at least part of her pay in standard certificates as we suggested she should do the question of rebates of all the subjects which seem to have attracted the attention of the public to the affairs of the standard oil company the matter of rebates from railroads has perhaps been uppermost the standard oil company of ohio of which i was president did receive rebates from the railroads
prior to 1880 but received no advantages for which it did not give full compensation the reason for rebates was that such was the railroad's method of business a public rate was made and collected by the railroad companies but so far as my knowledge extends was seldom retained in full a portion of it was repaid to the shippers as a rebate by this method the real rate of freight which any shipper paid was not known by his competitors nor by other railroad companies the amount being a matter of bargain with
the carrying company each shipper made the best bargain that he could but whether he was doing better than his competitor was only a matter of conjecture much dependent upon whether the shipper had the advantage of competition of carriers the standard oil company of ohio being situated at cleveland had the advantage of different carrying lines as well as of water transportation in the summer taking advantage of those facilities it made the best bargains possible for its freights other companies sought to do the same
the standard gave advantages to the railroads for the purpose of reducing the cost of transportation of freight it offered freights in large quantity car loads and train loads it furnished loading facilities and discharging facilities at great cost it provided regular traffic so that a railroad could conduct its transportation to the best advantage and use its equipment to the full extent of its hauling capacity without waiting for the refiner's convenience it exempted railroads from liability for fire
and carried its own insurance it provided at its own expense terminal facilities which permitted economies and handling for these services it obtained contracts for special allowances on freights but notwithstanding these special allowances this traffic from the standard oil company was far more profitable to the railroad companies than the smaller and irregular traffic which might have paid a higher rate to understand the situation which affected the giving and taking of rebates it must be remembered
that the railroads were all eager to enlarge their freight traffic they were competing with the facilities and rates offered by the boats on lake and canal and by the pipelines all these means of transporting oil cut into the business of the railroads and they were desperately anxious to successfully meet this competition as i have stated we provided means for loading and unloading cars expeditiously agreed to furnish a regular fixed number of car loads to transport each day and arranged with them for all the other
things that i have mentioned the final result being to reduce the cost of transportation for both the railroads and ourselves all this was following in the natural laws of trade pipelines versus railroads the building of the pipelines introduced another formidable competitor to the railroads but as oil could be transported by pumping through pipes at a much less cost than by hauling in tank cars in a railroad train the development of the pipeline was inevitable the question was simply
whether the oil traffic was sufficient in volume to make the investment profitable when pipelines had been built to oil fields where the wells had ceased to yield as often happened they were about most useless property imaginable an interesting feature developed through the relations which grew up between the railroads and the pipelines in many cases it was necessary to combine the facilities of both because the pipes reached only part of the way and from the place where they ended the railroad carried the oil to its
final destination in some instances a railroad had formally carried the oil the entire distance upon an agreed rate but now that this oil was partly pumped by pipelines and partly carried by rail the freight payment was divided between the two but as a through rate had been provided the owners of the pipeline agreed to remit a part of its charges to the railroad so we had cases where the standard paid a rebate to the railroad instead of the reverse but i do not remember having heard any
complaint of this coming from the students of these complicated subjects the profits of the standard oil company did not come from advantages given by railroads the railroads rather were the ones who profited by the traffic of the standard oil company and whatever advantage it received in its constant efforts to reduce rates of freight was only one of the many elements of lessening cost to the consumer which enabled us to increase our volume of business the world over because we could reduce the selling price
how general was the complicated bargaining for rates can hardly be imagined everyone got the best rate that he could after the passage of the interstate commerce act it was learned that many small companies which shipped limited quantities had received lower rates than we had been able to secure notwithstanding the fact that we had made large investments to provide for terminal facilities regular shipments and other economies i will remember a bright man from boston who had much to say about rebates and drawbacks
he was an old and experienced merchant and looked after his affairs with a cautious and watchful eye he feared that some of his competitors were doing better than he in bargaining for rates and he delivered himself of this conviction i am opposed on principle to the whole system of rebates and drawbacks unless i am in it end of chapter 4 recording by william tomco chapter five of random reminiscences of
men and events by john d rockefeller this is a librivox recording all librivox recordings are in the public domain for more information or to volunteer please visit recording by william tomco random reminiscences of men and events by john d rockefeller chapter 5 other business experiences and business principles
going into the iron ore fields was one of those experiences in which one finds oneself rather against the will for it was not a deliberate plan of mine to extend my cares and responsibilities my connection with iron oars came about through some unfortunate investments in the northwest country these interests had included a good many different industries mines steel mills paper mills a nail factory railroads lumber fields smelting properties and other investments about which i have
not forgotten i was a minority stockholder in all these enterprises and had no part in their management that all of them were profitable as a matter of fact for a period of years just preceding the panic of 1893 values were more or less inflated and many people who thought they were wealthy found that the actual facts were quite different from what they had imagined when the hard experiences of that panic forced upon them the unpalatable truth most of these
properties i had not even seen having relied upon the investigation of others respecting their worth indeed it has never been my custom to rely alone upon my own knowledge of the value of such plants i have found other people who knew much better than i how to investigate such enterprises even at this time i had been planning to relieve myself of business cares and the panic only caused me to postpone taking the long holiday to which i had been looking forward i was fortunate in making the acquaintance
of mr frederick t gates who was then engaged in some work in connection with the american baptist education society which required him to travel extensively over the country north south east and west it occurred to me that mr gates who had a great store of common sense though no special technical information about factories and mills might aid me in securing some first-hand information as to how these concerns were actually prospering once as he was going south i suggested
that he look over an iron mill in which i had some interest which happened to be on his route his report was a model of what such a report should be it stated the facts and in this case they were almost all unfavorable a little later he happened to be going west and i gave him the name and address of property in that region in which i held a minority interest i felt quite sure that this particular property was doing well and it was somewhat of a shock to me to learn through his clear and definite account that it was only a
question of time before this enterprise two which had been represented as rolling and money would get into trouble if things kept on as they were going nursing the commercially ill i then arranged with mr gates to accept a position whereby he could help me unravel these tangled affairs and become like myself a man of business but it was agreed between us that he should not abandon his larger and more important plans for working out some philanthropic aspirations that he had
right here i may stop to give credit to mr gates for possessing a combination of rare business ability very highly developed and very honorably exercised overshadowed by a passion to accomplish some great and far-reaching benefits to mankind the influence of which will last he is the chairman of the general education board and active and many other boards and for years he has helped in the various plans that we have been interested in where money was given in the hope that it would do something more than temporary service
mr gates has for many years been closely associated with my personal affairs he has been through strenuous times with me and has taken care of many kinds off my shoulders leaving me more time to play golf plan roads move trees and follow other congenial occupations his efforts in the investigations in connection with our educational contributions our medical research and other kindred works have been very successful during the last 10 or 12 years my son has shared with mr gates
the responsibility of this work and more recently mr star j murphy has also joined with us to help mr gates who has borne the heat and burden of the day and has well earned some leisure which we have wanted him to enjoy but to return to the story of our troubled investments mr gates went into the study of each of these business concerns and did the best he could with them it has been our policy never to allow a company in which we had an interest to be thrown into the bankruptcy court
if we could prevent it for receiverships are very costly in many ways and often involve heavy sacrifices of genuine values our plan has been to stay with the institution nurse it lend it money when necessary improve facilities cheapen production and avail ourselves of the opportunities which time and patience are likely to bring to make it self-sustaining and successful so we went carefully through the affairs of these crippled enterprises in the hard times
of 1893 and 1894 carrying many of them for years after sometimes buying the interests of others and sometimes selling our own interest but all or nearly all escape the expenses and humiliation of bankruptcy receivership and foreclosure before these matters were entirely closed up we had a vast amount of experience in the doctoring of the commercially ill my only excuse for dwelling upon the subject at this late date is to point out the fact to some
businessmen who get discouraged that much can be done by careful and patient attention even when the business is apparently in very deep water it requires two things some added capital put in by oneself or secured from others and a strict adherence to the sound natural laws of business the ore mines among these investments were some shares in a number of ore mines and an interest in the stocks and bonds of a railroad being built to carry the ore from the mines to lake
ports we had great faith in these mines but to work them the railroad was necessary it had begun but in the panic of 1893 it and all other developments were nearly ruined although we were minority holders of the stock it seemed to be up to us to keep the enterprise alive through the harrowing panic days i had to loan my personal securities to raise money and finally we were compelled to supply a great deal of actual cash and to get it we were obliged to go into
the then greatly upset money market and buy currency at a high premium to ship west by express to pay the laborers on the railroad and to keep them alive when the fright of the panic period subsided and matters became a little more settled we began to realize our situation we had invested many millions and no one wanted to go in with us to buy stock on the contrary everybody else seemed to want to sell the stock was offered to us in alarming
quantities substantially all of the capital stock of the companies came without any solicitation on our part quite the contrary and we paid for it in cash we now found ourselves in control of a great amount of ore lands from some of which the ore could be removed by a steam shovel for a few cents a ton but we still faced a most imperfect and inadequate method of transporting the ore to market when we realized that events were shaping themselves so that to protect our investments we
should be obliged to go into the business of selling in a large way we felt that we must not stop short of doing the work as effectively as possible and having already put in so much money we bought all the ore land that we thought was good that was offered to us the railroad and the ships were only a means to an end the orlans were the crux of the whole matter and we believed that we could never have too many good minds it was a surprise to me that the great iron and steel manufacturers do not place what seemed
to be an adequate value on these mines the lands which contained a good many of our best ore mines could have been purchased very cheaply before we became interested having launched ourselves into the venture we decided to supply ore to everyone who needed it by mining and transporting with the newest and most effective facilities and our profits we invested in more ore lands mr gates became the president of the various companies which owned the mines and the railroad to the lake to transport the oars and he started to learn and develop the
business of war mining and transportation he not only proved to be an apt scholar but he really mastered the various complexities of the business he did all the work and only consulted me when he wished to yet i remember several interesting experiences connected with the working out of these problems building the ships after this railroad problem was solved it was apparent that we needed our own ships to transport the oar down the lakes we knew absolutely nothing of
building ships for ore transportation and so following out our custom we went to the man who in our judgment had the widest knowledge of the subject he was already well known to us but was in the ore transportation business on a large scale on his own account and of course the moment we began to ship ore we realized that we would become competitors mr gates got into communication with this expert and came with him one evening to my house in new york just before dinner he said he could stay only a few minutes
but i told him that i thought we could finish up our affairs in 10 minutes and we did this is the only time i remember seeing personally anyone on the business of the or company all the conferences as i said before were carried on by mr gates who seemed to enjoy work and he has had abundant privileges in that direction we explained to this gentleman that we were proposing to transport our ore from these lake superior lands ourselves and that we should like to have him
assume charge of the construction of several ships to be of the largest and most approved type for our chats of success lay in having boats which could be operated with the greatest efficiency at that time the largest ships carried about 5 000 tons but in 1900 when we sold out we had ships that carried seven thousand or eight thousand tons and now there are some that transport as much as ten thousand tons and more this expert naturally replied that as he was in the or
carrying trade himself he had no desire to encourage us to go into it we explained to him that as we had made this large investment it seemed to us to be necessary for the protection of our interests to control our own lake carriers so we had decided to mine ship and market the oar that we came to him because he could plan and superintend the construction of the best ships for us and that we wanted to deal with him for that reason that notwithstanding that he represented one of the largest firms among our competitors
we knew that he was honest and straightforward and that we were most anxious to deal with him employing a competitor he still demured but we tried to convince him that we were not to be deterred from going into the trade and that we were willing to pay him a satisfactory commission for looking after the building of the ships somebody we explained was going to do the work for us and he might as well have the prophet as the next man this argument finally seemed to impress him and we then
and there closed an agreement the details of which were worked out afterward to our mutual satisfaction this gentleman was mr samuel mather of cleveland he spent only a few minutes in the house during which time we gave him the order for about three million dollars worth of ships and this was the only time i saw him but mr mather is a man of high business honor we trusted him implicitly although he was a competitor and we never had occasion to regret it at that time there were some nine or ten
ship building companies located at various points on the great lakes all were independent of each other and there was sharp competition between them times were pretty hard with them their business had not yet recovered from the panic of 1893 they were not able to keep their works in full operation it was in the fall of the year and many of their employees were facing a hard winter we took this into account in considering how many ships we should build and we made up our minds that we would build all the ships that could be built
and give employment to the idle men on the great lakes accordingly we instructed mr mather to write to each firm of shipbuilders and ascertain how many ships they could build and put in readiness for operation at the opening of navigation the next spring he found that some companies could build one some could build two and that the total number would be twelve accordingly we asked him to have constructed twelve ships all of steel all of the largest capacity then understood to be practicable
on the great lakes some of them were to be steamships and some consorts for towing but all were to be built on substantially the same general pattern which was to represent the best ideals then prevalent for ore carrying ships in giving such an order he was exposed of course to the risk of paying very high prices this would have been certain if mr mather had announced in advance that he was prepared to build 12 ships and asked bids on them just how he managed it i was not told until long after
and though it is now an old story of the lakes i repeat it as it may be new to many mr mather kept the secret of the number of ships he wished to construct absolutely to himself he set his plans and specifications each substantially a duplicate of the others to each of the firms and asked each firm to bid on one or two ships as the case might be all naturally supposed that at most only two ships were to be built and each was extremely eager to get the work or at least one of the two vessels
on the day before the contracts were to be let all the bidders were in cleveland on the invitation of mr mather one by one they were taken into his private office for special conference covering all the details preparatory to the final bid at the appointed hour the bids were in deep was the interest on the part of all the gentlemen as to who would be the lucky one to draw the prize mr mathers manor had convinced each that somehow he himself must be the favored bidder yet when he came to meet his competitors in the hotel lobby
the beams of satisfaction which plainly emanated from their faces also compelled many heart searchings at last the crucial hour came and at about the same moment each gentleman received a little note from mr mather conveying to him the tidings that to him had been awarded a contract sufficient to supply his works to their utmost capacity they all rushed with a common impulse to the hotel lobby where they had been accustomed to meet each bent on displaying his note and commiserating his unsuccessful rivals
only to discover that each had a contract for all he could do and that each had been actually bidding against nobody but himself great was the hilarity which covered their chagrin when they met and compared notes and looked into each other's faces however all were happy and satisfied but it may be said in passing that these amiable gentlemen all united subsequently and one company which has had a highly satisfactory career and that we paid a more uniform price for our subsequent
purchases of ships after the combination had been made a landsman for ship manager with these ships ordered we were fairly at the beginning of the ore enterprise but we realized that we had to make some arrangement to operate the ships and we again turned to our competitor mr mather in the hope that he would add this to his cares unfortunately because of his obligations to others he felt that this was impractical i asked mr gates one day soon after this
how are we to get someone to run these big ships we have ordered do you know of any experienced firm no said mr gates i do not know of any firm to suggest at the moment but why not run them ourselves you don't know anything about ships do you no he admitted but i have in mind a man who i believe could do it although when i tell you about him i fear you will think that his qualifications are not the best however he has the essentials he lives up the state
and never was on a ship in his life he probably wouldn't know the bow from the stern or a sea anchor from an umbrella but he has good sense he is honest enterprising keen and thrifty he has the art of quickly mastering a subject even though it'd be new to him and difficult we still have some months before the ships will be completed and if we put him to work now he will be ready to run the ships as soon as they are ready to be run all right i said let's give him the job and we did that man was mr
l m bowers he came from broome county new york mr bowers went from point to point on the lakes where the boats were building and studied them minutely he was quickly able to make valuable suggestions about their construction which were approved and adopted by the designers when the vessels were finished he took charge of them from the moment they floated and he managed these and the dozens which followed with the skill and ability that commanded the admiration of all the sailors on the lakes he even invented an anchor which he used
with our fleet and later it was adopted by other vessels and i have heard that it is used in the united states navy he remained in his position until we sold out we have given mr bowers all sorts of hard tasks since we retired from the lake traffic and have found him always successful lately the health of a member of his family has made it desirable for him to live in colorado and he is now the vigorous and efficient vice president of the colorado fuel and iron company
the great ships and the railroad put us in possession of the most favorable facilities from the first the organization was successful we built up a huge trade mining and carrying ore to cleveland and other lake ports we kept on building and developing until finally the fleet grew until it included 56 large steel vessels this enterprise in common with many other important business undertakings in which i was interested required very little of my personal attention owing to my good fortune in having
active competent and thoroughly reliable representatives who assumed so largely the responsibility of administration it gives me pleasure to state that the confidence which i have freely given to businessmen with whom i have been associated has been so fully justified selling to the steel company the work went on uninterruptedly and prosperously until the formation of the united states steel corporation a representative of this corporation came to see us about selling the land
the ore and the fleet of ships the business was going on smoothly and we had no pressing need to sell but as the organizer of the new company felt that our mines and railroads and ships were a necessary part of the scheme we told him we would be pleased to facilitate the completion of the great undertaking they had i think already closed with mr carnegie for his various properties after some negotiation they made an offer which we accepted whereby the whole plant mines ships railway etc
should become a part of the united states steel corporation the price paid was we felt very moderate considering the present and prospective value of the property this transaction bids fair to show a great profit to the steel company for many years and as our payment was largely in the securities of the company we had the opportunity to participate in this prosperity and so after a period of about seven years i went out of all association with the mining the transporting
and the selling of iron ore follow the laws of trade going over again in my mind the events connected with this ore experience that grew out of investments that seemed at the time to say the least rather unpromising i am impressed anew with the importance of a principle i have often referred to if i can make this point clear to the young man who has had the patience to follow these reminiscences so far it will be a satisfaction to me and i hope it may be a benefit to him the underlying essential element
of success in business affairs is to follow the established laws of high-class dealing keep to broad and shore lines and study them to be certain that they are correct ones watch the natural operations of trade and keep within them don't even think of temporary or sharp advantages don't waste your effort on a thing which ends in a petty triumph unless you are satisfied with the life of petty success be sure that before you go into an enterprise you see your way clear to
stay through to a successful end look ahead it is surprising how many bright businessmen go into important undertakings with little or no study of the controlling conditions they risk their all upon study diligently your capital requirements and fortify yourself fully to cover possible setbacks because you can absolutely count on meeting setbacks be sure that you are not deceiving yourself at any time about actual conditions the man who starts out simply with the idea of getting rich
won't succeed you must have a larger ambition there is no mystery in business success the great industrial leaders have told again and again the plain and obvious fact that there can be no permanent success without fair dealing that leads to widespread confidence in the man himself and that is the real capital we all prize and work for if you do each day's task successfully and stay faithfully within these natural operations of commercial laws which i talk so much about and keep your
head clear you will come out all right and will then perhaps forgive me for moralizing in this old-fashioned way it is hardly necessary to caution a young man who reads so sober a book as this not to lose his head over a little success or to grow impatient or discouraged by a little failure panic experiences i had desired to retire from business in the early 90s having begun work so young i felt that at 50 it was due me to have
freedom from absorption in active business affairs and to devote myself to a variety of interests other than money making which i claimed a portion of my time since the beginning of my business career but 1891 92 were years of ominous outlook in 1893 the storm broke and i had many investments to care for as i have already related this year and the next was a trying period of grave anxiety to everyone no one could retire from work at such a time
in the standard we continue to make progress even through all these panic years as we had large reserves of cash on account of our very conservative methods of financing in 1894 or 1895 i was able to carry out my plans to be relieved from any association with the actual management of the company's affairs from that time as i have said i have had little or no part in the conduct of the business since 1857 i can remember all the great
panics but i believe the panic of 1907 was the most trying no one escaped from it great or small important institutions had to be supported and carried through the time of distrust and unreasoning fear to mr morgan's real and effective help i should join with other businessmen and give great praise his commanding personality served a most valuable end he acted quickly and resolutely when quickness and decision were the things most needed to regain confidence
and he was efficiently seconded by many able and leading financiers of the country who cooperated courageously and effectively to restore confidence and prosperity the question has been asked if i think we shall revive quickly from the panic of october 1907 i hesitate to speak on the subject since i am not a prophet nor the son of a prophet but as to the ultimate outcome there is of course no doubt this temporary setback will lead to safer institutions and more
conservative management upon the part of everyone and this is a quality we need it will not long depress our wonderful spirit of initiative the country's resources have not been cut down nor injured by financial distrust a gradual recovery will only tend to make the future all the more secure and patience is a virtue in business affairs as in other things here again i would venture to utter a word of caution to businessmen let them study their own affairs frankly and face the truth
if their methods are extravagant let them realize the facts and act accordingly one cannot successfully go against natural tendencies and it is folly to fail to recognize them it is not easy for some impressionable and imaginative of people as we americans are to come down to plain hard facts yet we are doing it without loss of self-esteem or prestige throughout the world end of chapter 5 recording
by william tomco chapter 6 of random reminiscences of men and events by john d rockefeller this is a librivox recording all librivox recordings are in the public domain for more information or to volunteer please visit librivox recording by william tomco random reminiscences of men and events by john d rockefeller chapter 6 the difficult art of giving
it is no doubt easy to write platitudes and generalities about the joys of giving and the duty that one owes to one's fellow men and to put together again all the familiar phrases that have served for generations whenever the subject has been taken up i can hardly hope to succeed in starting any new interest in this great subject when gifted writers have so often failed yet i confess i find much more interest in it at this time than in rambling on as i have been doing
about the affairs of business and trade it is most difficult however to dwell upon a very practical and business-like side of benefactions generally without seeming to ignore or at least to fail to appreciate fully the spirit of giving which has its source in the heart and which of course makes it all worthwhile in this country we have come to the period when we can well afford to ask the ableist men to devote more of their time thought and money to the public well-being
i am not so presumptuous as to attempt to define exactly what this betterment work should consist of every man will do that for himself and his own conclusion will be final for himself it is well i think that no narrow or preconceived plan should be set down as the best i am sure it is a mistake to assume that the possession of money in great abundance necessarily brings happiness the very rich are just like all the rest of us and if they get pleasure from the
possession of money it comes from their ability to do things which give satisfaction to someone besides themselves limitations of the rich the mere expenditure of money for things so i am told by those who profess to know soon pauls upon one the novelty of being able to purchase anything one wants soon passes because what people most seek cannot be bought with money these rich men we read about in the newspapers cannot get personal returns beyond a
well-defined limit for their expenditure they cannot gratify the pleasures of the palate beyond very moderate bounds since they cannot purchase a good digestion they cannot lavish very much money on fine raiment for themselves or their families without suffering from public ridicule and in their homes they cannot go much beyond the comforts of the less wealthy without involving them in more pain than pleasure as i study wealthy men i can see but one way in which they can secure a real equivalent for money spent and
that is to cultivate a taste for giving where the money may produce an effect which will be a lasting gratification a man of business may often most properly consider that he does his share in building up a property which gives steady work for few or many people and his contribution consists in giving to his employees good working conditions new opportunities and a strong stimulus to good work just so long as he has a welfare of his employees in his mind
and follows his convictions no one can help honoring such a man it would be the narrowest sort of view to take and i think the meanest to consider that good works consist chiefly in the outright giving of money the best philanthropy the best philanthropy the help that does the most good and the least harm the help that nourishes civilization at its very root that most widely disseminates health righteousness and happiness is not what is usually called charity it
is in my judgment the investment of effort or time or money carefully considered with relation to the power of employing people at a remunerative wage to expand and develop the resources at hand and to give opportunity for progress and healthful labor where it did not exist before no mere money giving is comparable to this in its lasting and beneficial results if as i am accustomed to think this statement is a correct one
how vast indeed is a philanthropic field it may be urged that the daily vocation of life is one thing and the work of philanthropy quite another i have no sympathy with this notion the man who plans to do all his giving on sunday is a poor prop for the institutions of the country the excuse for referring so often to the busy man of affairs is that his help is most needed i know of men who have followed out this large plan of developing work not as a temporary matter but as a permanent principle
these men have taken up doubtful enterprises and carry them through to success often at great risk and in the face of great skepticism not as a matter only of professional profit but in the larger spirit of general uplift disinterested service the road to success if i were to give advice to a young man starting out in life i should say this to him if you aim for a large broad gauge success do not begin your business career whether you sell your labor or are an
independent producer with the idea of getting from the world by hook or crook all you can in the choice of your profession or your business employment let your first thought be where can i fit in so that i may be most effective in the work of the world where can i lend a hand in a way most effectively to advance the general interests enter life in such a spirit choose your vocation in that way and you have taken the first step on the highest road to a large success investigation will show that the great
fortunes which have been made in this country and the same is probably true of other lands have come to men who have performed great and far-reaching economic services men who with great faith in the future of their country have done most for the development of its resources the man will be most successful who confers the greatest service on the world commercial enterprises that are needed by the public will pay commercial enterprises that are not needed fail and ought to fail
on the other hand the one thing which such a business philosopher would be most careful to avoid in his investments of time and effort or money is the unnecessary duplication of existing industries he would regard all money spent in increasing needless competition as wasted and worse the man who puts up a second factory when the factory in existence will supply the public demand adequately and cheaply is wasting the national wealth and destroying the national prosperity taking the bread from the laborer and
unnecessarily introducing heartache and misery into the world probably the greatest single obstacle to the progress and happiness of the american people lies in the willingness of so many men to invest their time and money in multiplying competitive industries instead of opening up new fields and putting their money into lines of industry and development that are needed it requires a better type of mind to seek out and to support or to create the new than to follow the worn paths of accepted success
but here is a great chance in our still rapidly developing country the penalty of a selfish attempt to make the world confer a living without contributing to the progress or happiness of mankind is generally a failure to the individual the pity is that when he goes down he inflicts heartache and misery also on others who are in no way responsible the generosity of service probably the most generous people in the world are the very poor who assume each other's
burdens in the crises which come so often to the hard-pressed the mother in the tenement falls ill and the neighbor in the next room assumes her burdens the father loses his work and neighbors supply food to his children from their own scanty store how often one hears of cases where the orphans are taken over and brought up by the poor friend whose benefaction means great additional hardship this sort of genuine service makes the most princely gift from superabundance look insignificant indeed
the jews have had for centuries a precept that one-tenth of a man's possessions must be devoted to good works but even this measure of giving is but a rough yardstick to go by to give a tenth of one's income is well nigh an impossibility to some while to others it means a miserable pittance if the spirit is there the matter of proportion is soon lost sight of it is only the spirit of giving that counts and the very poor give without any self-consciousness but i fear that i am dealing with
generalities again the education of children in my early days may have been straight laced yet i have always been thankful that the custom was quite general to teach young people to give systematically of money that they themselves had earned it is a good thing to lead children to realize early the importance of their obligations to others but i confess it is increasingly difficult for what were luxuries then have become commonplaces now it should be a greater pleasure and satisfaction to give money for a good cause
than to earn it and i have always indulged the hope that during my life i should be able to help establish efficiency in giving so that wealth may be of greater use to the present and future generations perhaps just here lies a difference between the gifts of money and of service the poor meet promptly the misfortunes which confront the home circle and household of the neighbor the giver of money if his contribution is to be valuable must add service in the way of study and he must help to attack and improve
underlying conditions not being so pressed by the racking necessities it is he that should be better able to attack the subject from a more specific standpoint but the final analysis is the same his money is a feeble offering without the study behind it which will make its expenditure effective great hospitals conducted by noble and unselfish men and women are doing wonderful work but no less important are the achievements in research that reveal hitherto unknown facts about diseases
and provide the remedies by which many of them can be relieved or even stamped out to help the sick and distressed appeals to the kind-hearted always but to help the investigator who is striving successfully to attack the causes which bring about sickness and distress does not so strongly attract the giver of money the first appeals to the sentiments overpoweringly but the second has the head to deal with yet i am sure we are making wonderful advances in this field of scientific giving
all over the world the need of dealing with the questions of philanthropy with something beyond the impulses of emotion is evident and everywhere help is being given to those heroic men and women who are devoting themselves to the practical and essentially scientific tasks it is a good and inspiring thing to recall occasionally the heroism for example of the men who risked and sacrificed their lives to discover the facts about yellow fever a sacrifice for which untold generations will bless them
and this same spirit has animated the professions of medicine and surgery scientific research how far may the spirit of sacrifice properly extend a great number of scientific men every year give up everything to arrive at some helpful contribution to the sum of human knowledge and i have sometimes thought that good people who lightly and freely criticize their actions scarcely realize just what such criticism means it is one thing to stand on the