Business Titans Rise in the Gilded Age | The Men Who Built America (S1, E1) | Full Episode

[Music] all right [Music] [Applause] uh [Music] [Applause] [Music] [Applause] [Music] [Applause] oh [Music] [Applause] [Music] just five days after the end of the civil war president abraham lincoln is the final of the six hundred thousand deaths in america's bloodiest conflict [Music] the country is divided and the world looks at american democracy as a failed experiment [Music] but what most don't realize is that a new era has dawned the nation is entering an age of advancement and from the void left by the death of perhaps the greatest statesman we will ever know a new breed of leader will emerge the rockefellers the fords the carnegies were the first generation of what we know is now the entrepreneurial rock stars or what are today or other buffets and the jobs and the and the gates they were the ones that set the standard for the american dream they owned a new frontier literally in figure of who we are as a culture [Music] [Applause] [Music] men of insight innovation and ingenuity the likes of which the world has never seen and over the next five decades this small group will change history propelling the united states of america to greatness these were great men with a vision that nobody else had and that's why in the last century that 50-year period we built the world [Music] he said i can't take you to heaven i can't save your soul i can't promise forever [Applause] [Music] [Applause] [Music] feel my shoes [Music] [Music] for the first time in the country's short existence the man most capable of leading america is not a politician he's a self-made man who through sheer force of will turned a poor upbringing on the docks of new york harbor into an empire [Music] at 16 cornelius vanderbilt buys a small ferry boat with a 100 loan he quickly earns a reputation as a cutthroat businessman willing to use any means necessary to get ahead back then it was just pure competition my brain against your brain my effort against your effort you just competed [Music] [Applause] that's the way they looked at business it was the wild wild west and by hooker crook it was just win or lose and the best win he was a tough guy getting into scraps with other men beating the hell out of them and knocking them unconscious that competitive streak and that toughness very much defined his character [Music] his single ferry soon becomes a fleet of ships transporting goods and passengers to every corner of the growing country vanderbilt will become so synonymous with shipping that his nickname becomes the commodore i think vanderbilt recognized that what was going to be important is transporting goods from one place to another and he had this idea that required infrastructure and not infrastructure the government was going to provide but that he was going to provide over the next 40 years vanderbilt builds the largest shipping empire in the world then at the peak of his power just before the civil war he does the unthinkable [Music] work is underway on the first transcontinental railroad and the commodore realizes that its completion will transform america slashing cross-country travel time by months railroads were absolutely liberating because the railroads allowed cheap and efficient transportation from one corner of america to another vanderbilt sees his future he sells all of his ships and invests everything he has in railroads you talk about seeing around corners as an element of success that's what differentiates the good leader not many people have it not many people can predict that corner that is a characteristic of great leaders [Music] his decision to invest heavily in rail pays off by the end of the war vanderbilt is the richest man in america with a net worth of over 68 million dollars the equivalent of 75 billion today but all that money can't buy his escape from the war's devastation [Music] in the wake of the civil war the country mourns publicly [Music] while vanderbilt does so privately [Music] the first card is the past the second the present and the third is the future there has been an unexpected loss someone close to you my son george [Music] he died in the war what about the future it's here yet [Music] there will be a war war's over no your war is about to begin hey watch it man [Music] tormented by the loss of his favorite son vanderbilt's empire is more vulnerable than ever before for vanderbilt this is a great tragedy he had one son who had that same sense of physical strength and ability and he had died when he was still quite young it was deeply troubling for the commodore for years vanderbilt groomed george to take over the family business now the commodore is forced to rely on his less accomplished son william [Music] i'm making you operations director of the hudson railroad [Music] vanderbilt places william in the midst of negotiations with the owners of a rival railroad some name your price if you give us your freight year round we will give you the privilege of allowing your passengers access into manhattan for 200 000 that privilege is not worth 200 000 then let us settle on 100 000 i believe that to be a fair and generous offer i'm not really interested in your generosity i'm only interested in getting the best deal for my shareholders and that does not include handing over 100 000 or even one dollar my father wants only what he believes is right the trouble is your father doesn't know what is right the old man should be put out to pasture [Music] the message is clear the competition no longer sees vanderbilt as a man to fear people are always rooting for very successful people to fail the day people are not taking shots at you it means you're not on top anymore but where they see weakness the commodore sees an opportunity to assert his dominance and teach william what it means to be a vanderbilt [Music] if they want a war i'll give them a war [Music] vanderbilt owns the only rail bridge into new york city it's the gateway to the country's largest port supplying the entire continent vanderbilt knows this is the hammer he needs to beat his rivals into submission sit down i want you to close the albany bridge [Music] without the bridge every other railroad is shut out of new york city [Music] vanderbilt in essence single-handedly erected a blockade around the nation's largest city cutting it off from contact with the rest of the country he was now asserting his dominance ladies and gentlemen this train will not be going any farther we're going to watch them bleed [Music] the civil war has left america in ruins for the first time in its history the nation must rebuild [Music] over 50 000 miles of railroad track have transformed the country [Music] commodore cornelius vanderbilt grew up poor but has created a railroad empire making him the richest man in the country at 72 he's 30 years past the average life expectancy and his competitors see him as weak it's a mistake they'll come to regret [Music] locked in a battle for control of the rail lines east of the mississippi the commodore is holding nothing back i want you to close the albany bridge we're going to watch them bleed vanderbilt controls the only bridge into new york city america's busiest port seizing an opportunity he sets up a blockade this train will not be going any farther shutting the bridge leaves millions of pounds of cargo unable to reach the rest of the country and slowly bleeds his competitors dry [Music] before their stock is worthless the presidents of the rival railroad try to sell all their shares [Music] word quickly reaches wall street triggering a massive selloff [Music] [Music] on some money new york central shares are dropping fast how low 20 a share buy everything you can [Music] [Music] vanderbilt was buying all of that stock that suddenly flooded the market at rock bottom prices free aces in just days vanderbilt takes control of the rival railroad creating the largest single rail company in america the new york central railroad became the centerpiece of his empire and it came to him as the sudden result of a skillfully executed campaign to get revenge railroads soon crisscross america tying together the country in a way that just 15 years earlier was unimaginable and providing over 180 000 jobs laying tracks becomes america's engine for unprecedented growth railroads allowed the industrial economy to boom in ways that it couldn't have before one after the other which essentially was led by the railroads largely because there was a need to close the gap between those east of the mississippi and those on the west coast vanderbilt has made himself the undisputed king of railroads and now he wants the world to know it he envisions a monument that will symbolize his immense power work will begin on building a new station that will bring together the three railroads the harlem the hudson and the central it shall be in the heart of new york and be called the grand central depot thousands of workers labor over the next two years on the most ambitious urban construction project america has ever seen [Music] grand central is the biggest building in all of new york city [Music] and the biggest train station in the country [Music] covering some 22 acres [Music] this enormous building towered over every other building in new york at the time and it was a physical symbol of the size and power of vanderbilt's railroad empire its importance as a physical symbol as a physical capital of his empire cannot be underestimated and it still stamps new york's geography to this day [Music] vanderbilt may be on top of the world but his blind ambition will soon make him vulnerable to a challenge coming from the most unlikely pair imaginable it's abandoned everybody [Music] the growth of the railroads thrusts america into the biggest building expansion the country has ever seen led by a new breed of leader the story of america isn't just the story of the patriots that helped build the democracy the reason united states is the leading economy in the world uh is because of the work of entrepreneurs who created entire industries that propelled the united states to be the leader of the free world one man cornelius vanderbilt through brute force and intimidation has made himself the undisputed king of the railroads he now owns 40 of america's train lines [Music] but he wants them all to me it's always what's next and i think that's what drives most very successful people it's never about the money i mean it's a way of keeping score it's about achievement and it's about winning a game and it's about upping the ante chicago is america's fastest growing city the line connecting it to new york is the most traveled and valuable in all the world and it's not vanderbilt's to make his empire complete he must gain control of the erie line [Music] the erie was one of the relatively early publicly traded corporations vanderbilt had the advantage of millions and millions of dollars deep pockets are always an advantage when you're trying to gain control of a corporation [Applause] [Music] vanderbilt instructs his agents to buy up as much stock as possible demanding control of the company by the end of the week it's a vintage vanderbilt move one he pioneered known today as a hostile takeover [Music] but his attempt will be thwarted by an even more ingenious idea cooked up by two unknowns jay gould and jim fisk all right the mistake that the erie board have made is that they have telegraphed where they need to expand without securing the land first gould and fisk are stuck in middle management at the erie but they represent the new america that vanderbilt is helping to create one of self-made men with ruthless ambition and after years of watching the commodore dominate they're eager to build their own empire they recognize vanderbilt's plan to buy the line and see the opportunity they've been waiting for competition i think it's good for the system and it's really i think what most businesses is about it's doing a better job on out hustling your competitors [Music] gould and fisk begin printing new shares of stock using a printing press they set up in the basement of the erie offices each share they print dilutes vanderbilt's stake in the company and they print over one hundred thousand there was some fine print in one of the clauses of the erie's charter that allowed the board of directors to issue new stock unbeknownst to shareholders go and so the more shares that vanderbilt bought the more he had to buy in order to approach that magic majority [Music] their plan is known as watering down stock highly illegal today at the time it had never been imagined its simplicity is brilliant and wall street is never the same the only rule was there were no rules whatever it took to put your competition out of business they were going to try to do it [Music] unaware vanderbilt continues to buy [Music] think of the look on his face oh god i wish i could be a fly on that wall [Music] the freshly printed shares are hand delivered to vanderbilt here are the eerie shares i assume we control the company now [Music] [Music] [Music] vanderbilt has bought seven million dollars of watered-down stock from gould and fisk today worth over 1 billion dollars [Music] [Laughter] god [Music] vanderbilt has been underestimated before but if you come at the king you shouldn't expect to win the greatest growth explosion in america's short life is underway rail lines now connect huge expanses of the country [Music] controlling them means having power that just five years earlier was unimaginable many are staking their claim [Music] i think there are people in every generation that have a vision that transcends their moment in their time commodore cornelius vanderbilt owns more miles of rail than anyone in the world [Music] but like all men of power he faces constant challenges [Music] competition gets very aggressive people have no idea how aggressive it is and sometimes you don't even hear because what goes on behind your back is not a pretty picture at the height of his power vanderbilt is outsmarted by a pair of unknowns mr vanderbilt's money jay gould and jim fisk have fleeced the commodore out of millions and they want the world to know it thank you don't mind if i do uh it is no secret what uh vanderbilt has been trying to do he owns more railroads than anybody else well gould and me we have struck a blow for the little guy now sure he may be rich and sure he may be powerful but somebody had to stand up to the old bastard it was a humiliating defeat for the commodore a man who was so fiercely competitive who wanted to win at absolutely everything to whom money was so important and here he was defeated and insulted publicly by gould and fisk [Music] gould and fisk may be on top of the world but they've awakened a sleeping lion vanderbilt vows to never be beaten again they don't think in terms of money they think in terms of winning now naturally if you win big in business money falls but that shouldn't be your objective your objective should be to win to win win win all the time not sometimes every time vanderbilt immediately begins looking for a new edge [Music] he realizes that the railroads have been overbuilt and the future of the industry isn't in building new lines but in transporting new cargo [Music] innovation is not a big breakthrough invention every time innovation is a constant thing but if you don't have an innovative company coming to work every day to find a better way you don't have a company you're getting ready to die on the vine [Music] if vanderbilt can corner the market on a new source of freight one that can keep his trains constantly full he'll be able to control the railroad industry and the commodore knows just where to look [Music] oil is revolutionizing life in america crude from the ground is being refined into kerosene a safe and inexpensive source of light and that access to light is completely changing the way americans live before kerosene the average american didn't have access to a consistent light source when the sun came down darkness ruled kerosene is a phenomenon that will forever change the world and vanderbilt knows it's his next opportunity to cash in the idea is to see what's missing that's what a creative entrepreneur does he serves people with things that they need some people can't find a new thing to do but sometimes you see something that everybody has to have so oh man i gotta give him this and then you go to work on it because they need it vanderbilt sees the demand for kerosene skyrocketing all across the country he knows that to meet the demand the makers of kerosene will need a new way to ship their oil if vanderbilt can corner the market on those oil shipments he'll propel himself back to the top of the railroad industry all he needs to do now is find a supplier we're going to extend along the south shore to cleveland why cleveland [Music] cleveland is a small city of just under 50 000 but it's sitting on top of an ocean of oil eastern ohio is the middle east of its day and the area around cleveland is one of the largest oil fields in the world vanderbilt learns about a refinery built near the railroads in cleveland the perfect mark for his master plan [Music] he reaches out to the owner a struggling young oil man vanderbilt is hoping to pluck from obscurity that oil man is john d rockefeller [Music] why are we paying so much on plumbers we run a refinery so we start making our own pipes at this rate we'll be lucky if we break even this year if you want to call it a day john just say [Applause] i should go is everything all right that's fine [Music] at the age of 27 rockefeller is in the early stages of building his refining business but his company is teetering on the verge of bankruptcy vanderbilt sees him as someone he can manipulate to his advantage an exclusive deal to ship rockefeller's oil will guarantee that the commodore's trains stay filled with cargo vanderbilt invites rockefeller to meet with him in new york [Music] for the young oil man the meeting is the opportunity of a lifetime a way out of his troubles [Music] and a way to save his company from complete collapse rockefeller he respected vanderbilt he could see what he had achieved vanderbilt was setting the pattern and the archetype of what rockefeller himself wanted to be he wanted to be the vanderbilt of petroleum that's the way he saw himself as rockefeller prepares for his trip to new york vanderbilt's plan is set in motion [Music] so [Music] i'm the train departs cleveland at 6 25 a. m [Music] [Music] america is rising the country is experiencing a period of growth like none it's ever seen railroads have united the states and commerce flows with a speed never before thought possible the man at the forefront of this explosive change is cornelius vanderbilt but at 76 he realizes that the railroads have been overbuilt to stay ahead of the competition the commodore turns to a new exploding industry and a struggling young oil man john d rockefeller vanderbilt invites him to new york city for a meeting [Music] [Music] fate intervenes the lord is my shepherd i shall not want he maketh me to lie down in green pastures [Music] he restoreth my soul john rockefeller narrowly missed the train one that would have carried him to his certain death the close call has a profound impact on the young oil man he leadeth me into paths of righteousness for his name's sake amen [Music] a man of deep faith he becomes convinced that god has spared him for a reason without thinking that he himself in particular was chosen by god to become this great business success rockefeller believed that everything was divinely ordained so nothing happened in the world without god's will without god's blessing rockefeller once again heads to meet with vanderbilt as a changed man where before he was intimidated and facing bankruptcy now he's a man of destiny cornelius vanderbilt may be the richest and most powerful man in the country accustomed to getting what he wants but he has no idea what he's about to encounter [Music] every business is about understanding people which people you have to get through which people you have to embrace which people you have to jump over which people you have to push out of the way that's the game you play cards mr rockefeller no shame you could learn a lot about competition i know all i need to know so i'm looking to do a deal with an oil refinery and that could be you i'm willing to do an exclusive deal 1. 65 a barrel that's a discount of more than a third there's several refineries in cleveland why should i give you such a deal because i'll fill all your trains with my oil and if you don't do the deal i'll fill someone else's trains [Music] [Music] do you trust him i don't know [Music] rockefeller may have gotten the rate he was looking for but in return he's agreed to provide vanderbilt with over 60 train cars of oil every day [Music] the only problem is rockefeller has no way to produce that much kerosene his capacity is less than half of that rockefeller has over promised but he knows the deal with vanderbilt will be the opportunity he's been waiting for he just needs to find a way to produce more kerosene [Music] it's a daunting task but john d rockefeller has been beating the odds his entire life rockefeller is raised in a poor cleveland household but even as a young man he yearns for something more something bigger and he knows it isn't going to be handed to him [Music] as a young man he shows a strong entrepreneurial streak starting his own small business selling candy to local children thank you very much [Music] from an early age rockefeller helps to support his family mostly because he was never able to rely on his father it cures cancer folks that is right it cures cancer now you're asking yourself sir i bet in your mind you're saying bill is this true john rockefeller's father is a con man becca i met seven years ago she had pneumonia better known around cleveland as devil bill who would like to buy some dollar 25 a bottle yes sir he disappears for months at a time leaving his family without money to support themselves i'm only here for one day once i'm gone i am gone i may not be back [Music] never trust anybody son not even me [Music] with his father gone rockefeller is forced to quit school and get a job to support his mother and siblings his work ethic and intuition will become the building blocks for the american dream my great-grandfather john d rockefeller was an absolutely brilliant businessman when he started out he wasn't even in oil or anything you know he worked at it very very hard and there's an ethic in the rockefeller family of hard work stuck in a dead-end job he becomes fixated on finding a big idea and taking a chance [Music] be therefore perfect even as your father which is in heaven is perfect [Music] you please rise [Music] let us sing hymn 89.

[Music] [Music] is [Music] give all us [Music] [Music] i think entrepreneurs and certain business people just look at life and look at things that are changing and are able to see those things and say i can create a business out of that [Music] rockefeller realizes oil has the potential to change the world and make him rich in the process but rockefeller knows that drilling for oil is a gamble filled with uncertainty and since he doesn't believe in luck he starts looking for a way to make money from oil without the risk he had a mind for efficiency and there was probably something in him that looked at the production process and saw how wasteful that was in the first place you drilled wells and they turn up dry and then you drill wells and hit a gusher and half the oil would be lost and that offended his sense of efficiency rockefeller knows there's a better way today everybody wants to be an entrepreneur they've heard these great stories you know about apple but you know what when you start a company you can think what the revenues are going to be how much it's going to be worth to shareholders but you always need a technical element you need somebody who knows how to do it and build the things you need the scientists [Music] oil turns crude from the ground into kerosene a clean burning fuel that can be used in lamps once the oil gets to 350 degrees the kerosene starts to vaporize then once it's cooled you have a stable pure product how much to produce a gallon 50 60 cents i don't know rockefeller's insight puts him one step ahead of his competitors he believes that while gamblers drill for oil businessmen refine it whoever could control the refining process could very well have the whole industry [Music] at 24 years old rockefeller invests everything he has about four thousand dollars into building his first refinery go higher higher but he struggles early on to find an edge in the industry that changes when the most powerful man in the country comes calling mr rockefeller the deal with vanderbilt gives him cheap shipping rates and the chance to corner the u. s oil market but he's over promised agreeing to supply 60 barrels a day when his capacity is less than half that and when you've made a deal with the most powerful man in america failure is not an option you have to be smart you have to have vision you have to have all of these different things but the most successful people are the people that had the right idea but never ever quit or gave up the people that really succeed in life are those that don't quit rockefeller needs to quickly expand his company and to do that he needs investors the problem is kerosene is getting a bad name [Music] stories of the fuel exploding and burning down homes are on the front page of newspapers across the country making potential investors skeptical due to high demand many refiners are rushing to market with dangerous kerosene that's extremely volatile rockefeller sees the problem as an opportunity he realizes that there's a need to calm the public's fears and provide them with a product they can rely on oil refining warehouses barrel making and shipping facilities why the name because standard oil will be the only company in the industry to guarantee a uniform quality of kerosene rockefellers and all these guys they were all great salesmen and at the end of the day it's the salesman who'll make the money well you could certainly understand how rockefeller could have named his oil company standard oil pretty ambitious organic name he was creating a standard and uh it worked rockefeller's standard oil quiets fears and immediately becomes the most sought after product in the country bringing in investor after investor he meets his promise to provide 60 train cars of oil a day but that level of output is only enough to supply a small segment of the country the ohio oil man knows that with oil on every train crisscrossing the country he can supply every home in the nation but to make that happen he'll have to take on commodore cornelius vanderbilt america is expanding rapidly cornelius vanderbilt's railroads have united the country and commerce now moves faster than ever but america's newest obsession is light clean safe light the kind provided by john d rockefeller oil is changing the world and the ohio refiner is leading the charge the tightness of that day revolutionized business in america we became the sort of dominant economic force in the world because we could make stuff we could create stuff we could build stuff we could power stuff [Music] john rockefeller's standard oil is now the largest producer of refined kerosene in the country [Music] and his exclusive deal with vanderbilt allows him to ship his product to homes throughout the country at incredibly cheap rates [Music] but for rockefeller it isn't enough he's outgrown his deal with vanderbilt once unable to fill vanderbilt's trains now he has more oil than the commodore can possibly ship and vanderbilt's biggest competitor knows it [Music] tom scott is the president of one of the largest train lines in the country he wants to take vanderbilt's place as king of the railroads and he knows a deal with rockefeller is the key [Music] scott heads to cleveland with his protege a young up-and-comer named andrew carnegie as scott's most trusted lieutenant [Music] carnegie has helped craft the pitch [Music] what i'm proposing is an alliance between you want a cartel between oil and railroads i prefer to call a bike give me the numbers standard oil will receive a 40 rebate for every barrel it ships we'll send papers over in the morning no a verbal contract is fine rockefeller gets a better deal from scott than he ever could have gotten from vanderbilt [Music] the commodore has lost his competitive edge [Music] to the great frustration of vanderbilt rockefeller very skillfully played those railroads against each other oil was something the railroads couldn't afford to let go and so they fought very hard to get that traffic with the railroads in his pocket [Music] rockefeller can supply every home in the nation with standard oil kerosene and with all that profit rockefeller begins to buy out his competitors and we need to stand together i'm offering all of you a way out so you can hold your heads high the opportunity to sell to standard oil will be a godsend to you all if you take standard oil stock you and your loved ones will never know want his intent is simple he wants to own every refinery in the country it's a concept that's been impossible to execute today we know it as a monopoly but rockefeller isn't just expanding his company [Music] he's also looking to maximize profit by any means necessary we've got another refinery one more into the fold tell me to take a look at it no i want you to shut it down the business of creating monopolies crushing opposition part of me says he did that because it was there to be done and he could do it better than anybody else and he made a bloody fortune out of it by the time he's finished rockefeller controls 90 of the north american oil supply his company standard oil is the country's first monopoly at 33 the ohio oil man is now the most powerful man in the country the commodore has created a monster he realizes that the only way to combat rockefeller is for the railroads to start working together [Music] he forms an unlikely alliance with his biggest rival tom scott and together they agree to pull all of rockefeller's deals [Music] thank you [Music] to rockefeller the move is nothing short of a declaration of war america is emerging as one of the mightiest nations on earth the country is now crowded with rail lines and kerosene lights most homes the amazing evolution has been led by two men driven by a desire to create a world that few imagined commodore cornelius vanderbilt and john d rockefeller have sparked the modernization of the country but the former partners interests are no longer aligned vanderbilt has formed an unlikely alliance with tom scott aimed at forcing their biggest client to pay going rates [Music] john rockefeller sees their actions as a declaration of war [Music] and he's not going down without a fight john rockefeller had the ruthlessness that sometimes comes from utter conviction that what he was doing was right and that and not just correct but divinely inspired and the people who opposed him weren't really entitled to their point of view because their point of view was wrong [Music] it was almost as though they had turned aside god's grace well if you turn aside god's offer of grace then expect no mercy rockefeller is determined to find another way to transport his oil [Music] he knows if he can't the railroads will win [Music] rockefeller's solution again comes from the most unlikely of places so we can increase the yield of the kerosene but then we get more of the volatile waste we can burn some of it off as fuel in the refinery but its high flammability creates a storage problem [Music] once we get the higher temperatures we can start creating the lubricating oils i'll need to reconfigure the refinery [Music] oil in the refinery is moved using large pipes and rockefeller realizes if those pipes can transport oil over short distances they could also be used over longer distances if rockefeller can build a pipeline large enough he'll be able to cut the railroads out of the oil business for good [Music] the pipeline will require a massive investment and incredible risk but if he gets it right rockefeller will be able to do what he loves to do most win it probably comes early in an entrepreneur's life where you realize you're willing to do things in the business world that other people aren't willing to do everybody has got ideas and everybody's got ambitions but most people aren't willing to cross that line and i think an entrepreneur that's successful that's your nature wherever there's change wherever there's uncertainty there's opportunity [Music] rockefeller's workers labor around the clock blasting through the countryside and laying over a mile and a half of pipeline every day business in the end is understanding the playing field tell me who's on it what their strengths are what their weaknesses are and what is your checkmate play to top them and nail them and so you're always in that competitive game you're looking at innovation you're looking at leap frogging trying to get ahead of them you're never complacent you're semi-paranoid about what they're doing that's what a game is all about by the time the pipeline is complete it's over four thousand miles long stretching across ohio and pennsylvania and connecting thousands of the world's most lucrative oil wells directly to rockefeller's refineries [Music] john rockefeller has finally found his way to eliminate the railroads from the oil business and in the process he's forever revolutionized the way oil is transported [Music] for 25 years the railroads have been the biggest industry in the country the backbone of the american economy no one has ever had the nerve to take them on until now rockefeller knows that without his oil the railroads will struggle to stay alive it's a colossal blow to the industry and with all that leverage rockefeller has vanderbilt and the railroads right where he wants them the united states of america is changing like never before in just a decade the country has become one of the most advanced on earth and darkness no longer means the end of the day two men have driven this remaking of the country [Music] john d rockefeller and cornelius vanderbilt are locked in a battle of wills [Music] [Music] vanderbilt and his competitors are in drastic search of passengers and cargo to fill the trains running on their lines in the 1870s the country needed to be connected via railroads and what happens then is everybody who thinks they have an edge in the railroad business goes out and raises money and they start their own railroad and what happened then as we've seen happen many a time since then is it created a huge bubble john d rockefeller's oil makes up nearly 40 percent of the cargo shipped on the rails but when vanderbilt teams with his biggest rival to push for a rate increase rockefeller takes it as a declaration of war [Music] he builds a pipeline in response and begins to pull his shipments and since the railroads have been drastically overbuilt losing cargo means losing money stocks plummet as investors run scared when prices get out of control and smart people decide wow this thing is a bubble i want out then you can get a collapse very quickly [Music] by the time the panic is through one third of the country's 360 railroad companies have gone bankrupt every crisis of this type whether it's 2008 or 1873 has got the same roots namely that it was unanticipated so a necessary condition for a crisis is nobody expects it the crash is the worst america has seen in its short history unsure how to prevent a complete collapse the stock exchange shuts down and stays closed for ten straight days the panic of 1873 triggered the first full-blown national depression and nobody quite knew what to do about it for the first time large very large numbers of american workers were without jobs [Music] workers got laid off but the owners they still lived in the style that they were accustomed to but no one was shedding any tears from john d rockefeller [Music] people were saving their tears for themselves when they found themselves out of work out of their homes out of food out of hope [Music] while many of the biggest companies in the country struggle to survive rockefeller sees opportunity his belief in the survival of the fittest kicking in as his competition collapses rockefeller picks them off buying out bankrupt oil companies for next to nothing i find that i do better in bad markets i buy things in bad markets and you can't do that in a great economy you can't buy it either you're going to buy it very expensively or not be able to buy it at all so there's a lot of opportunity i find in the bad times by the time the depression is through rockefeller has created the largest corporate empire in america he was playing the game of industry and he was simply better at it than everybody else he saw the industrial marketplace as a place for the survival of the fittest and he was fitter than anybody else therefore he survived not only that therefore he deserved to survive and they didn't [Music] while rockefeller expands his company his adversaries at the railroads are struggling to survive then at the height of the depression the king of the american railroads cornelius vanderbilt dies at the age of 82. [Music] vanderbilt leaves his empire worth over 100 million dollars to his son william rockefeller knows that without vanderbilt he would have never been able to build his empire [Music] but rockefeller's last remaining adversaries refused to go down without a fight tom scott and his protege andrew carnegie have managed to survive and since rockefeller's pipeline doesn't extend to pittsburgh he's forced to continue to use their trains but scott knows if he and carnegie don't diversify they won't survive scott devises an aggressive plan to expand his empire one that's sure to catch rockefeller's attention [Music] he's going to break into the oil business by building a pipeline of his own [Music] if there's one thing john rockefeller hates more than anything else it's competition [Music] tom scott is in for war i've tried to be friendly to the pennsylvania i've given you plenty of business have i not and now i find that you're invading my field and that my friend is piracy we'll take your feelings into account mr rockefeller two-thirds of the oil you carry comes from me if you don't retreat i'll take it to the other railroads as far as i'm aware there isn't another railroad that runs from pittsburgh to new york [Music] [Music] america's growth after the civil war is driven by railroads uniting the country and oil lighting the way no one has capitalized on the growth more than john d rockefeller who now controls 90 of the u.