Before there was antitrust, there were trusts.
A “trust” is a group of firms or industries organized to concentrate power, and reduce or eliminate competition. The model developed in the 1880s, as burgeoning oil baron John D. Rockefeller sought to consolidate his holdings across state borders by placing stock from different properties into a single entity known as a trust. As Open Markets Institute fellow Matt Stoller explains in his new book, Goliath:
Until the 1880s, vast new industrial power was regulated at a state level through restrictive corporate chartering. For instance, state corporate charters did not allow one corporation to buy stock in another. But in 1882, an oil refiner named John D. Rockefeller helped invent a centralizing legal tool to capture industries across state borders. He placed all stock from various oil properties into one legal structure called a “trust.” Known as the Standard Oil Trust, Rockefeller’s oil companies might look independent legally, but the trust’s board of directors set policy for the combined group. With this new legal tool, Rockefeller built the largest and most powerful monopoly of the era.