Host Ed Ayers talks to historian Christopher Jones about the 1870s skirmish between John D. Rockefeller and the upstart competitors who built the country’s first long-distance oil pipeline.
PETER: If you’re just joining us, this is BackStory, and we’re talking today about the infrastructure that makes modern life possible. We began the show with a discussion about moving electricity from point A to point B. We’re going to conclude with another story about energy, this one about oil.
FEMALE SPEAKER: The Keystone pipeline. Surrounded by controversy, a decision pending. It would transport Canadian oil to Gulf Coast refineries. But do we need it? Believe it or not–
ED: As you may be aware, a pretty serious debate has been raging for the past few years about whether or not to move forward with plans for the Keystone XL pipeline. One of the questions that has been raised is whether it would be safer to transport crude from Canada by rail.
MALE SPEAKER: Firefighters say the oil slick runs for miles along the Southern California coastline after an estimated 21,000 gallons poured from a large broken pipeline Tuesday morning.
ED: Some argue the trains would be just as prone to accidents.
FEMALE SPEAKER: In November in Alabama, these railcars derailed and blew up, and caused an explosion that led to the release of 750,000 gallons of crude oil.
ED: Historian Christopher Jones has been watching this debate with a certain sense of deja vu, and that’s because Americans were debating the merits of rails versus pipes all the way back in the late 19th century. It all started, says Jones, when Standard Oil Chief John D Rockefeller cut sweetheart deals with railroad companies, deals that essentially blocked his competitors from using trains to get oil to their refineries.
CHRISTOPHER JONES: And what happens in 1879 is that a group of oilmen not affiliated with Standard Oil decide to try and shift the game on Rockefeller. And their way of doing this is that they’re going to build the world’s first long distance oil pipeline.
So the key person behind this is Byron Benson, who teams with a group of other people to build a pipeline. It’s called the Tidewater Pipeline, because the goal is to get from Western Pennsylvania all the way to the ocean.
And this is an audacious undertaking. It’s comparable in many ways to the building of the Brooklyn Bridge, which happens just a few years later. In fact, it’s so audacious that a number of people following the oil industry start calling the project Benson’s Folly.
ED: And I’m also guessing that Rockefeller is not a big fan of this, right?
CHRISTOPHER JONES: Right. Everyone knew that Rockefeller wasn’t going to simply sit back and let the heart of his empire crumble. And he did not, in fact. Rockefeller employed several strategies to try to subvert the pipeline.
The pipeline company had to buy a single unbroken strip of land over 100 miles long in order to complete the pipeline. And so what Rockefeller did was try as hard as he could to buy all of the land rights in blocking strips.
In addition to just sort of trying to buy these property rights, Rockefeller was also completely happy to fight dirty. So he would send agents into the field that pretended to be pipeline employees to throw off the progress on the project.
And he even hired someone who ended up dressing as a bum, and that bum would sit outside the pipeline’s telegraph office, where he could actually hear the click, click of the telegraph, memorize those messages, and up reporting them back to Standard Oil. So this was frontier capitalism at its sort of dirtiest and perhaps most representative.
ED: All right. So there’s all this skulduggery going on. And so does this mean that David defeats Goliath?
CHRISTOPHER JONES: Yes. So it turns out actually by the end of May 1879, the pipeline is completed, and they put the oil in the pipeline. It starts to flow.
There’s a brief moment of panic because the pressures in the pipes suddenly rise enormously, and so they have to shut down the pipes. They open up one of the pipes and discover there were several pieces of wood and rope stuck in the pipeline. And they were never quite sure whether this was careless workers or deliberate sabotage.
But they clear it out, restart the pumps. And a few days later, in early June 1879, the first oil arrives in Williamsport. It’s a great success. There’s a spirited celebration.
In fact, one of the funny stories about this is that several decades later in the 1930s, Kern and Hammerstein actually produce a musical called High, Wide, and Handsome, and the whole plot centers around a group of oilmen trying to defeat an evil railroad magnate by building a pipeline.
ED: Can you hum a few bars?
CHRISTOPHER JONES: I certainly cannot.
ED: So how did Rockefeller respond to this threat?
CHRISTOPHER JONES: Rockefeller ends up paying Benson and his colleagues the highest form of flattery, which is imitation. And Rockefeller’s always been a wily fox. And he was willing to admit he may have lost a battle, but he certainly wasn’t going to end up losing the war.
And within five years, he’s created his own network of pipelines connecting the oil fields to all of his major refineries. And Rockefeller now controls about 88% of the pipeline shipments by 1883. And this is where the transition to pipeline for the transport of oil really gains steam.
ED: And the railroads are just pushed aside?
CHRISTOPHER JONES: The railroads are the big losers. in this. And Cornelius Vanderbilt, one of America’s brilliant capitalists at this time, head of the New York Central Railroad, he observes as soon as the Tidewater Pipeline is completed that quote “The oil business is sealed. There’s no question that the railroads won’t have any of the oil business for long.” And it turns out, for about 130 years, he’s right.
ED: That’s an intriguing statement. What happens after 130 years?
CHRISTOPHER JONES: Well, what’s going on right now is the railroads are serving the movement of oil in regions that are fairly new producers of oil, where pipeline technology has not already been built. And it turns out now it’s much, much more difficult to actually get a pipeline constructed, as debates over the Keystone XL Pipeline have shown. And so railroads that may have started to have been obsolete in regions like North Dakota are suddenly being revitalized to carry that crude oil.
ED: So is one mode of transport intrinsically superior to the other?
CHRISTOPHER JONES: Most of the time when people debate whether pipelines or railroads are better for transporting oil, they’re thinking about a, how much does it cost? B, how much capacity do the respective infrastructures have? And c, what’s their safety record? And all of those are absolutely important considerations. But there’s very little conversation about what’s the overall civic benefit of the difference between these transportation systems?
CHRISTOPHER JONES: Obviously, pipelines and railroads can both carry oil, but pipelines carry a single product in a single direction, and they don’t end up returning anything material in their wake. If you’re a resident of North Dakota right now, do you want pipelines built or railroads? You probably actually prefer railroads being built, because the oil industry there is already under severe constraint as a result of the price of oil dropping over the last six months.
And so if oil goes away, pipelines do you no good. But if the oil goes away and you have a robust railroad network, you actually have the opportunity to transition into other types of economic development.
ED: So what lessons do you think we should take from the Tidewater Pipeline when we think about our own struggles today over, say, the Keystone Pipeline?
CHRISTOPHER JONES: What the Tidewater Pipeline ended up initiating was a very long shift in the transport of oil to pipelines. And in doing so, it didn’t simply act as a passive conduit between producers and consumers. These oil pipelines were directly part of building markets for oil. By making it cheaper to ship oil, they encouraged the people running them to help find new uses.
And so part of the reason we use as much oil as we do is because we’ve built technologies that make it really easy and attractive to do so. And so one lesson we can take from this is that which technologies of energy transport we build are going to shape what types of energy we use.
When we hear the word technology, we often think gadgets. We think things like iPhones or laptops, technologies that are exciting, that are sexy, that we’re going to use for a couple years and then toss away. We basically have dating relationships with our gadgets. Infrastructure is very different. Infrastructure operates for decades. And in this sense, we need to think about not dating infrastructure but actually marrying it. You know, waking up in bed with 30 to 40 years from now.
And so when people debate something like the Keystone XL Pipeline, they often talk about, well, look at all the jobs it’s going to create over the next couple years. But if we build the Keystone XL Pipeline, you better believe that for 30, 40, 50 years, the people owning it are going to work hard to make sure we’re continuing to use oil. And I think if we start to think in the time frames of several decades, it starts to look much less attractive.
ED: Christopher Jones is a history professor at Arizona State University. He’s the author of Roots of Power: Energy in Modern America.
BRIAN: That’s going to do it for today. But as always, we’re eager to keep the conversation. You’ll find us at backstoryradio.org. There’s more on today’s topic there, as well as descriptions of the shows we have in the works.
One is about how Americans have thought about our national enemies. Another takes on the history of happiness. We’d love to be able to include your stories and ideas in these episodes. You can leave us a comment there, or send an email to firstname.lastname@example.org. Whatever you do, don’t be a stranger.