How The Rockefellers Went From ‘New Money’ To “Old Money”
Cleveland, Ohio on the brink of the 19th century — a collage of hardy souls, undaunted dreams, and fierce determination.
It’s here, treading through the thunder of steel on rail and the symphony of industry piercing the crisp Midwestern sky, where our story begins.
We meet a young John D. Rockefeller — a man not BORN great — but upon whom greatness would be bestowed by the trials of life.
Young John’s eyes reflect an old soul, a wisdom gifted by his devout mother, Eliza Davison.
A pillar of steadfast religious faith, she has imparted in her son invaluable lessons of charity, frugality, and financial stewardship.
In the muted glow of candlelight, John faithfully absorbed these lessons, his handwritten ledger of daily expenditures a constant companion.
However, even as he wrote, his father’s shadow filled the room.
His father, William Avery Rockefeller, a man with a chameleon-like charm and a penchant for high stakes, peddled his ‘miracle’ potions.
Blending a mix of naive hope and snake-oil, he sold dreams to the desperate and unsuspecting.
This tension — an intricate waltz between integrity and deception, forms the foundation of Rockefeller Family’s destiny.
Each moment adds a new layer of resolve:
The quiet diligence from a mother’s teachings and the ruthless business cunning kindled by a father’s guile.
Embark with us on this journey from the freshly minted wealth of the “new money” Rockefellers to the prestigious “old money” dynasty John would build, as we describe…
How The Rockefeller Family Went From New Money To “Old Money”
1. A Baptism of Oil
Our saga begins in New York state, where our pivotal protagonist, John D. Rockefeller, first experienced life’s trials and triumphs.
Raised by his devout Baptist mother, Eliza Davison, Rockefeller learned the virtues of charity, frugality, and the effective management of money from an early age.
This foundational training would later become the bedrock of his extraordinary business acumen.
However, to fully comprehend the twists and turns of this familial odyssey from rags to riches, we must introduce an almost Dickensian character — John D.’s father, William Avery Rockefeller.
Far from the righteous path his wife tread, William Avery lived a life of flamboyant ruses.
As a traveling salesman, he peddled ‘miracle’ potions with the grand promise of healing any affliction, from insignificant ailments to terminal diseases.
Astoundingly, the key ingredient of these elixirs was petroleum — a substance that, unbeknownst to young John, would power his future, paving his way towards becoming America’s first billionaire.
William Avery, however, bore a less-than-reputable reputation.
He was a man of questionable integrity, dabbling in horse thievery, and habitually tangling with the law.
His unorthodox antics eventually led to a forced relocation to Cleveland, Ohio — a move that uprooted young Rockefeller from his childhood home in upstate New York.
Eliza Rockefeller, a figure of steadfast faith and resilience, stood as the counterpoint to William Avery’s volatile lifestyle.
Eliza’s devout religiosity played a significant role in shaping young John D. Rockefeller’s worldview, infusing his business strategies with a sense of moral responsibility and ethical diligence that would remain with him throughout his life.
Now, despite William Avery’s dubious character, he surprisingly harbored a staunch belief in the power of education.
As such, he enrolled John D. and his brother William at Cleveland’s Central High School, the country’s first free public high school west of the Allegheny mountains.
This experience instilled a strong sense of independence in John D., particularly during his father’s frequent, lengthy absences.
And remarkably, these absences were not without their silver lining.
When he did indeed return, William Avery’s penchant for deception extended to his own son, with John D.’s father himself once bragging:
“I cheat my boys every chance I get. I want to make ’em sharp.”
This unconventional paternal approach, however, inadvertently honed Rockefeller’s business instincts.
His early exposure to his father’s ‘swindles’ molded him into a shrewd negotiator — a business hawk with an eagle eye for spotting potential pitfalls and deceptive maneuvers in the commercial arena.
The motherly figure of Eliza Davison, however, was the enduring, guiding beacon in John D.’s life.
Over the course of his life, he progressively distanced himself from his father, while his mother’s influence and memory only amplified.
Her teachings left an indelible mark on Rockefeller, who would go on to recall:
”From the beginning, I was trained to work, to save, and to give.”
Upon completion of his education, Rockefeller — now seasoned with both life and business experience — found his heart’s delight in his high school sweetheart, Laura Spellman — marking the close of one eventful chapter and the dawn of another in his remarkable journey.
2. The Rise of John D. Rockefeller, Sr.
John D. Rockefeller’s business journey, one marked by scrupulous financial acumen and towering ambition, began in September 1855, when at just sixteen, he entered the business world as an assistant bookkeeper for a small produce commission firm — Hewitt & Tuttle in Cleveland.
Even then, his meticulous nature shone through, keeping detailed ledgers that accounted for every cent in his possession.
A staunch advocate of charity, Rockefeller adhered to the concept of tithing from his earliest days of earning income for himself, committing 10% of his earnings to charitable causes.
In 1859, Rockefeller partnered with Maurice B. Clark, launching a produce commission business.
They raised $4,000, more than $100,000 in 2022 dollars a sizable capital for the time.
The Civil War period proved lucrative as the Union Army’s demand for supplies soared.
However, it was towards the end of the conflict, as the prospect of war-time profits faded, that Rockefeller and Clark turned their attention towards oil refining.
The true turning point came in 1866 when John’s brother, William Rockefeller Jr., built another refinery in Cleveland, pulling John into the partnership.
In 1867, Henry Morrison Flagler joined them, establishing Rockefeller, Andrews & Flagler, which rapidly grew to be the world’s largest oil refinery.
This operation laid the foundation for Standard Oil, officially formed on January 10, 1870, which embarked on an aggressive campaign to consolidate the oil market.
Known as “The Cleveland Conquest” or “The Cleveland Massacre” Standard Oil, in less than four months in 1872, absorbed 22 of its 26 Cleveland competitors.
By 1880, Standard Oil controlled approximately 90% of all oil refineries and pipelines in the United States, allowing Rockefeller to effectively dictate the entire industry’s pace and direction.
However, Rockefeller’s strategies were not without benefits for the public.
Before 1870, only the affluent could afford oil light, provided by expensive whale oil.
However, in the following decade, thanks to the economies of scale realized by Standard Oil, kerosene became widely accessible to the working and middle classes.
Yet, these business practices, including underselling, differential pricing, and secret transportation rebates, also invited controversy, and by 1880, Standard Oil was reported by the media as:
“The most cruel, impudent, pitiless, and grasping monopoly that ever fastened upon a country.”
The intense criticism led to the creation of the Standard Oil Trust in 1882 — a corporation of corporations — to centralize Rockefeller’s holdings, which further stirred public suspicion.
Despite these challenges, Standard Oil stood resilient, consistently making profits year after year, achieving an aura of invincibility and unparalleled wealth.
Ida Tarbell, a journalist, would ultimately lead a movement to challenge this behemoth.
Her meticulous investigation — culminating in a series of damning articles — exposed Standard Oil’s ruthless tactics and ultimately contributed to the dissolution of Standard Oil as a monopoly, leading to the Clayton Antitrust Act.
Without fully ‘throwing in the towel’, Rockefeller started looking at his transition into retirement, while still seeking to preserve his wealth and transform his ‘new money’ into the more enduring ‘old money.’
He diversified his investments and launched the Rockefeller Foundation in 1913, with an initial donation of $100 million, broadening his legacy beyond oil and industry, highlighting his commitment to philanthropy.
However, his rise from a ‘new money’ tycoon to an ‘old money’ patriarch was marred by personal challenges and public scorn, with some speculating that the relentless scrutiny caused Rockefeller to develop alopecia.
Despite these obstacles, The name “Rockefeller” had a journey from poverty to the patriarch of one of America’s most powerful families that was only just beginning as he passed control of his dynasty to the next generation.
3. The Next Generation of Rockefellers
Now, John D. Rockefeller was not merely an astute businessman, he was also an ardent practitioner of ‘old money’ principles such as long-term financial planning, privacy, understated elegance, philanthropy, and thrift.
These were the values he instilled in his children, ensuring the Rockefeller legacy would span generations.
In contrast to the ‘new money’ families of the Gilded Age, the Rockefellers adopted a more discreet and sustainable approach to wealth.
Consider the Vanderbilt and Gould families, prominent figures of the Gilded Age, whom epitomized “new money” opulence.
Cornelius Vanderbilt, renowned for his empire of steamships and the New York Central Railroad, celebrated his fortune with a flourish.
The manifestation of his wealth was particularly evident in his family’s real estate purchases.
The family commissioned grand mansions that showcased their affluence — such as the opulent Vanderbilt Mansions on Fifth Avenue — which stood as symbols of their enormous wealth.
These included the ‘Triple Palace,’ a trio of residences designed by famed architects and decorated with marble, gold, and other precious materials.
In addition to these residences, Cornelius Vanderbilt II acquired an expensive townhouse on 57th street, which later had to be sold due to financial strain.
Similarly, ‘Marble House’ — built by William Kissam Vanderbilt in Newport, Rhode Island — was another display of the Vanderbilt fortune. This lavish mansion, however, was eventually sold due to its exorbitant upkeep costs.
Their penchant for grandeur extended to their social events as well, with the Vanderbilt Costume Ball of 1883, a million-dollar spectacle, immortalizing their penchant for lavish spending.
However, the Vanderbilt’s unchecked extravagance, combined with their neglect of long-term financial planning, ultimately led to the erosion of their substantial fortune.
This financial mismanagement left many of their descendants grappling with relative poverty, a stark contrast to their forebears’ opulence.
Similarly, the Gould family, led by railroad magnate Jay Gould, failed to preserve their wealth across generations.
Jay Gould was famed for his extravagant lifestyle, evident in his creation of Lyndhurst, a sprawling Gothic Revival mansion.
His offspring mirrored his extravagance, erecting impressive residences such as a castle-like mansion in Lakewood, New Jersey, and a French chateau-inspired mansion in Tarrytown, New York.
However, the Goulds mirrored the Vanderbilts in their lack of emphasis on sustained wealth management.
George Jay Gould II and Jay Gould II, descendants of this once affluent lineage, pursued commendable careers, yet the family fortune dwindled over time.
After George Jay Gould’s demise, their once formidable wealth had practically evaporated, resulting in their descendants leading lives far from their opulent heritage.
Today, the Vanderbilt and Gould legacies serve as potent reminders of the impermanence of wealth without prudent stewardship.
The next generation of Rockefellers — however, took a different path — rooted in the ‘old money’ traditions of privacy, thrift, and philanthropy. These principles played out vividly in the lives of John D. Rockefeller Sr.’s children.
John D. Rockefeller Jr., the only son and the primary heir, inherited not only his father’s vast fortune but also his commitment to philanthropy.
He financed the construction of the Rockefeller Center in New York and restored colonial Williamsburg, among many other philanthropic endeavors.
Yet, despite his eye-watering size of income, he lived a relatively modest lifestyle, avoiding public displays of wealth and maintaining a strong focus on his family.
Similarly, Rockefeller’s daughters also embodied the ‘old money’ principles.
Elizabeth, the eldest, married a banker and led a private life, out of the public eye.
Alice, despite suffering from various health issues throughout her life, was known for her philanthropy and carried the family tradition of supporting educational and health causes.
Alta, the third child, married a scientist and focused her efforts on supporting scientific research.
Edith, the youngest, devoted herself to music and philanthropy, continuing the family’s commitment to giving back to society.
However, embodying ‘old money’ principles did not exempt the Rockefeller children from difficulties.
John D. Rockefeller Jr., for instance, was often criticized for his ruthless business practices, just like his father.
Similarly, Alice struggled with her health, suffering from various illnesses throughout her life.
The public scrutiny that came with the Rockefeller name was also a constant source of stress for the family.
Yet, despite these challenges, the ‘old money’ principles continued to guide them.
The Rockefeller children, following their father’s example, sought to preserve their wealth for future generations, focusing on long-term financial planning rather than short-term gain.
They understood the importance of privacy, choosing to live away from the public eye.
They embraced understated elegance and avoided the ostentatious displays of wealth common among ‘new money’ families.
4. The Rockefeller Family’s Transition From “New Money” To “Old Money”
The financial landscape of America’s Gilded Age was indeed a volatile crucible, with fortunes being made and lost almost overnight.
Within this climate, a distinction arose between “new money” — the freshly minted wealth of entrepreneurs and industrialists — and “old money,” the inherited wealth of established families that had accumulated assets over generations.
The terms encapsulated more than just the age of wealth; they signified cultural differences, social acceptability, and the capacity for wealth preservation.
The Rockefellers — beginning as “new money” — were no strangers to this volatility.
However, their pragmatic approach to wealth accumulation and preservation arguably allowed them to transition into the esteemed category of “old money.”
Key to this transformation was their ability to integrate into high society and form strategic alliances through marriage.
The family made insightful choices in matrimony, aligning themselves with well-established families through advantageous marriages.
John D. Rockefeller Jr., the sole son of John D. Rockefeller Sr., set the pace in 1901 when he married Abby Aldrich.
Abby wasn’t just any bride; she was the daughter of U.S. Senator Nelson W. Aldrich, a political powerhouse whose influence stretched from Wall Street to Washington.
The Aldrich family had a strong political lineage, and this marital alliance thrust the Rockefellers into significant political circles, offering them not just social prominence but also a chance to influence policy.
Their progeny — representing the third generation of the Rockefellers — adopted this pattern of strategically beneficial marriages.
In 1930, Nelson Rockefeller, later to become the Vice President of the United States, married Mary Todhunter Clark.
Mary came from an esteemed Philadelphia family known for its quiet yet significant influence in the city’s legal and civic affairs.
These unions were not solely about the joining of two individuals, but rather about the confluence of power, influence, and long-standing family heritage.
The Rockefellers also distinguished themselves through public service and philanthropy.
As previously noted, Nelson held the high office of Vice President under President Gerald Ford, reinforcing the family’s presence in the nation’s political sphere.
Simultaneously, his brother Laurance carved out a niche as a venture capitalist and passionate conservationist, contributing to the preservation of natural habitats and environmental sustainability.
Continuing the family’s trajectory in public service, John D. Rockefeller IV — more commonly called “Jay” — Nelson’s nephew and a fourth-generation Rockefeller, built a significant political career.
Born in 1937, Jay served as West Virginia’s Secretary of State and later as the state’s Governor, impressively holding office from 1977 to 1985.
In 1984, he was elected to the United States Senate, serving five terms until he decided not to seek re-election in 2014.
As a senator, Jay championed issues such as healthcare reform and internet privacy, thus maintaining the family’s tradition of public service.
Addtionally, embedded in the core of the Rockefeller family’s legacy is their remarkable philanthropy.
The Rockefellers became known as patrons of education and the arts, helping to shape America’s cultural landscape.
They lent their considerable resources to institutions such as the University of Chicago and the Museum of Modern Art.
This deep-rooted philanthropy wasn’t simply about donating money; it was an essential tool for shaping their public persona, showcasing their commitment to societal advancement.
Yet, alongside this is their equally noteworthy ability to amass and preserve substantial wealth. This duality reflects the character of John D. Rockefeller himself, who was known to be a ruthless businessman yet an incredibly generous philanthropist.
Their philanthropic ventures were strategic. They served to not only improve public welfare but also to bolster their societal standing, assisting in their seamless transition from “new money” to “old money.”
Through these actions, the Rockefellers were not just cementing their place within societal elites, but also highlighting their dedication to the public good.
Therefore, simultaneously, the Rockefellers adopted several strategies to safeguard their wealth, ensuring that it would endure across generations.
One significant step in this regard was the establishment of the Rockefeller Foundation in 1913.
This move was more than an act of charity; it was a calculated effort to shield their wealth from heavy estate taxes, thereby allowing it to grow and benefit society simultaneously.
Over time, the Foundation’s immense contributions to public health, education, and arts helped to further establish and fortify the Rockefeller name.
Trusts also played a critical role in their wealth preservation strategy.
John D. Rockefeller Sr. formed his first trust in 1891, transferring a significant portion of his fortune to it.
This move offered both tax advantages and protection against potential heirs’ mismanagement, thereby ensuring the continuity of the Rockefeller fortune.
In addition, the Rockefellers innovatively used holding companies to manage their diverse business interests.
These corporate structures provided a protective shield for their wealth while also promoting growth.
This use of corporate entities set a precedent for future wealthy families, showing how wealth could be protected and multiplied simultaneously.
As such, the Rockefellers are a perfect example of how one family managed to become synonymous with philanthropy while maintaining an iron grip on their wealth, demonstrating a duality that has become part of their enduring legacy.
