John D Rockefeller: Standard Oil Monopoly — Reading Comprehension

John D. Rockefeller became one of the most influential business leaders in American history by building the monopoly known as Standard Oil. In the late 1800s, the United States experienced rapid industrialization. Factories, railroads, and new technologies transformed the economy. Oil became vital for lighting lamps and, later, powering machines and automobiles. Rockefeller recognized the growing importance of oil and decided to enter the industry.

At first, the oil business was highly competitive. Many small companies drilled, refined, and sold oil. Prices changed constantly, and efficiency was low. Rockefeller believed that by consolidating these businesses, he could make oil cheaper and more reliable. He used a variety of strategies, such as buying out competitors, negotiating special rates with railroads, and creating secret agreements. These actions allowed him to control nearly all oil production and transportation in the country. As a result, Standard Oil became the most powerful oil company in America.

This rapid growth caused concern among many Americans. Some praised Rockefeller for lowering prices and improving efficiency. Others criticized his methods, arguing they were unfair and harmed smaller businesses. Ida Tarbell, a famous journalist, investigated Standard Oil and wrote, "There is no man in the United States who has such absolute power over any one industry as Mr. Rockefeller has over oil." Her work revealed how the company’s actions affected workers, small companies, and the public. Tarbell’s reporting is an example of muckraking, a type of journalism that exposed corruption and demanded reform.

Government officials faced a dilemma. On one hand, Standard Oil made oil products cheaper and available to more people. On the other, the concentration of so much power in one company threatened competition and economic freedom. The government eventually responded by passing the Sherman Antitrust Act in 1890. This law aimed to prevent monopolies and restore fair competition. In 1911, after years of legal battles, the Supreme Court ruled that Standard Oil must be broken into smaller companies. The decision marked a turning point in how the United States regulated big business.

Different groups saw these events differently. Rockefeller and his supporters argued that his business practices brought stability and progress. Workers and small business owners often saw Standard Oil as a threat to their independence and livelihoods. Reformers, including journalists and some politicians, believed government intervention was necessary to protect the public interest. These debates about the role of business and government continue to shape American society today.

The story of Standard Oil demonstrates the complexities of industrial growth. While monopolies can lead to efficiency and lower prices, they can also limit competition and concentrate power. The government’s efforts to regulate big businesses reflect the ongoing struggle to balance economic growth with fairness and opportunity for all Americans.

Interesting Fact: In 1911, when Standard Oil was broken up, it split into 34 separate companies. Some of today’s largest oil companies, like ExxonMobil and Chevron, are direct descendants of Standard Oil.

Who founded Standard Oil?

What was Standard Oil?

In what year was Standard Oil broken up?

Why did some people criticize Rockefeller?

What did the Sherman Antitrust Act do?

What did Ida Tarbell’s writing expose?

Standard Oil was praised for lowering prices.

What is a monopoly?