Standard Oil of New Jersey

Standard Oil of New Jersey was implicated in a wartime patent-and-market arrangement with the German chemical firm I. G. Farben that helped delay the development of synthetic-rubber production in the United States. The Truman committee presented the agreement not as proof of an unpatriotic motive, but as an example of private business interests operating by their own rules while the resulting costs fell on the nation.

The Agreement with I. G. Farben

The arrangement exchanged control in two industries. I. G. Farben gave Standard Oil a monopoly in the oil industry; in return, Standard Oil gave Farben complete control of patents in the chemical field, including those for rubber. The agreement linked Standard Oil’s commercial position to Farben’s authority over technology that American manufacturers needed to produce synthetic rubber.

When American rubber manufacturers approached Standard Oil for licenses to make synthetic rubber, they were either refused or offered licenses on highly unfavorable terms. The consequence, as the committee described it, was the intentional delay of synthetic-rubber plants. The account adds that Farben’s position was dictated by the German government, making the patent arrangement part of a wider wartime problem of access to strategic materials and production capacity.

The Committee’s Finding

Harry S. Truman reported the agreement as part of the committee’s examination of shortages and obstacles to defense production. Its conclusion drew a distinction between motive and consequence: it found no “unpatriotic motive,” characterizing the conduct instead as “big business playing the game according to the rules.” That judgment did not absolve the arrangement of its effects. The committee emphasized that the heavy price was to be borne by the entire nation.

The surrounding discussion also describes an agreement between I. G. Farben and Alcoa involving magnesium. That was a separate corporate arrangement, not an action attributed to Standard Oil of New Jersey. Together, the examples place the company’s synthetic-rubber agreement within the book’s broader account of how commercial control over materials and patents could impede American defense production.