Sherman Anti-Trust

1950 Words8 Pages
Sammy Friedman
Mr. Di Bartolo
Term Paper

The Standard Oil Company, founded in 1870, was one of the most notable companies in American history. Its success was unprecedented, and its effects on the American economy and way of business were powerful and lasting. Founded and expanded by John D. Rockefeller, the Standard Oil Company absorbed almost all other oil companies in the country and consolidated all of them under one “trust.” It then chartered several smaller branches in different states, such as New Jersey, in order to monopolize the oil industry and create an oil empire. Though the Standard Oil Company was very controversial and its dissolution was ultimately seen as a triumph, it was also a positive force in many ways, both in the short
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Around the turn of the century, a movement of “trust-busters” and “muckrakers” emerged to expose trusts such as Standard Oil as greedy monopolies created for the benefit of those in charge rather than for the benefit of the people. Though the Sherman Anti-Trust Act made monopolies illegal, the law was very vague and many trusts were able to get around its provisions. Also, the Supreme Court decision in United States v. E. C. Knight Co. (1895) established that the act only needed to be applied to commerce, and so trusts such as Standard Oil were able to argue that it did not apply to them because they were manufacturers. Because of this, there was not much actual reform until the early twentieth century, when “trustbusters” began to take a public stand against trusts for “aggressive pricing” that forced smaller companies to be bought out. “Trustbusters” realized that the Standard Oil Company’s motivation for lowering process was not to benefit the American people, but rather, was to hurt other oil companies who would not be able afford competing with low prices and would ultimately be forced to either dismantle or to be bought out by Standard Oil. This fact, exposed by trustbusters and muckrakers such as Ida Tarbell, led to a monumental shift in public sentiment towards large trusts and ultimately led to the revolutionary Supreme Court case Standard Oil Company of New Jersey vs. United States, which created a new standard for big
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