Saturday, September 12, 2009
Lessons from Standard Oil... Big Banks New Power... College Football... A Conservative from a Conservative State...
Lessons from Standard Oil...
Nearly a century ago, the oil fields of western Pennsylvania gushed think black crude oil. Derricks were placed almost on top of one another, and oil ran so thick that it flowed out into the streets and local streams. Boom towns like Titusville and Oil City sprang up over night. However, it took an Ohioan by the name of John D. Rockefeller to reign in the awesome power of oil by controlling the only aspect of production that truly mattered... refineries.
Rockefeller was able to mater the refinery business... and use almost every crude by-product imaginable. He was also master of pinching pennies. As the story goes, the hands-on leadership of Rockefeller had barrel makers experiment with the number of soldering drops used to seal a barrel. Rockefeller calculated that if two drops of solder could be saved on every barrel, he could amass a fortune in savings.
Trust-busters and other progressive candidates like Teddy Roosevelt claimed that Standard Oil had become too big and too powerful. Later, the Federal government broke up the Standard Oil Company for uncompetitive business practices under the Sherman Anti-Trust Act. This created a number of smaller oil companies including Exxon, ARCO, Conoco-Phillips, Standard Oil, and British Petroleum.
It is interesting how times have changed. We are currently witnessing the creating of trusts in the financial sector. Smaller local and regional banks are being squeezed out. Yet big banks like Citi, Goldman Sachs, PNC, Morgan Stanley, and Bank of America continue to get bigger. Yet, we are more focused on health care issues which while a major component of every day life, will pale in comparison to the power that is being wielded by big banks. Should this course hold true, banks will emerge from this crisis with new found powers, and more importantly added leverage on Capitol Hill. (2)
As I have reminded readers, Founding Fathers like Thomas Jefferson warned against bank interests claiming "I believe that banking institutions are more dangerous to our liberties than standing armies. If the American people ever allow private banks to control the issue of their currency, first by inflation, then by deflation, the banks and corporations that will grow up around [the banks] will deprive the people of all property until their children wake-up homeless on the continent their fathers conquered. The issuing power should be taken from the banks and restored to the people, to whom it properly belongs."
Later, Andrew Jackson took the entire bank lobby to task. Even after he did not renew the charter of the Bank of the united States, Jackson claimed " I have always been afraid of banks." Not only did he fear the power of banks, and their ability to manipulate finances but more importantly, he knew that banks could also manipulate politicians and policies as well.
You heard it here first. Should Congress continue to press the Federal Reserve for an audit, there will be another financial panic... and you can take this one to the bank!
I kicked myself. Sure I went 1-2 with neither East Carolina nor Missouri covering. I was more disappointed with the fact that Missouri really should have been Boston College, as I wrote down the wrong selection for my reader. Regardless, I am currently at 4-2 for the season.
Jim Tressel played the last quarter of the game not to lost, as opposed to playing to win. I just knew that USC would score on the final drive... I have seen in happen too many times to teams like the Browns where one of John Elway's drives... an Ernest Byner fumble... a Brian Sipe interception to Lester Hayes... or whatever... My point is that the Browns are not the kind of comparisons I want to make to any team I follow unless you are the Bad News Bears.