Abstracts History

Broken trusts: The Texas Attorney General versus the oil industry, 1889-1909

by Jonathan Whitney Singer

The legal history of state antitrust enforcement and the oil industry in Texas illustrates how and why antitrust law contemplated complementary enforcement at the state and federal government level. Historians, economists, and lawyers have concentrated on federal antitrust law and enforcement, ignoring state efforts. Yet for most of the first twenty-five years following the enactment of the Sherman Antitrust Act, federal enforcement efforts were extremely limited, leaving the field to the states. Texas was one of several states that had strong antitrust laws, and whose attorneys general prosecuted antitrust violations with vigor. Political ambition was a factor in the decisions to investigate and prosecute cases against a highly visible target, the petroleum industry, but there was also a genuine belief in the goals of antitrust policy, and in the efficacy of enforcement of the laws. Enforcement efforts were also complicated by the fact that large oil companies provided vital commodities, articles of "prime necessity," to the citizens of Texas and following the discovery of large oil fields, played an increasingly important role in the economies of many Texas communities. The Texas Attorney General's antitrust enforcement efforts against the oil industry in this time of transition from an agricultural society to an industrial society provide insights into the litigation process, and reveal how well the rhetoric of trust-busting fit with the reality of antitrust enforcement. The antitrust crusade against the petroleum industry also highlights the changing roles of state government in the late nineteenth and early twentieth centuries, particularly the Attorney General's Department. The experience of Texas undermines the view that federal action has always dominated antitrust enforcement efforts and that antitrust litigation against Standard Oil was ineffective and ineffectual. Rather, the Texas Attorney General's litigations and their results suggest that some states took their role in the dual enforcement scheme seriously and that the measure of success of antitrust enforcement goes beyond the amount of monetary penalties collected, and companies permanently ousted from a state.