The Muckraker's Century: Investigative Truth vs. Concentrated Power

“nothing they did not hope and dare.” The triumph of optimism in Titusville was destined to end, however: “Suddenly, at the very heyday of this confidence, a big hand reached out from nobody knew where, to steal their conquest and throttle their future.” That mysterious hand belonged to none other than John D. Rockefeller, as Tarbell would boldly elucidate years later in her chronicle of the history of the Standard Oil Company for McClure’s magazine—the landmark series that would affirm her reputation as the leading investigative journalist of her day.

At the time, all that Ida’s father and his colleagues knew was that the railroads arbitrarily doubled their published rates for carrying petroleum—crude and refined—to the east coast, a huge inflation heralding ruin for the entire region. The local oilmen eventually discovered that Rockefeller had forged an alliance between the railroads and a small group of privileged refiners.

OOSEVELT’S FLAGGING HOPES OF CONFRONTING the trusts, purging corrupt political machines, and checking abuses by both capital and labor were rekindled by the January 1903 publication of McClure’s magazine. In this celebrated issue, the “groundbreaking trio” of Tarbell, Steffens, and Baker produced three exhaustive, hard-hitting investigative pieces that ushered in the distinctive new period of journalism that would later be christened “the muckraking era.” First off, Ida Tarbell revealed the predatory, illegal practices of Standard Oil; Lincoln Steffens then exposed the corrupt dealings of Minneapolis mayor Albert “Doc” Ames; and finally, Ray Baker described the complicity of union members manipulating and deceiving their own fellow workers.

The convergence of these three powerful exposés prompted S. S. McClure to attach an unusual editorial postscript to his January issue, exhorting readers to take action against corruption in every phase of industrial life.

continued to climb as the three writers pursued their investigations. Tarbell’s Standard Oil series eventually stretched over a three-year period; Steffens’s studies of corrupt political machines in a dozen cities and states generated fourteen articles and two books; and Baker produced more than a dozen seminal articles on labor and capital. Baker later attributed the tremendous impact of these meticulously researched exposés to the fact that they finally verified years of “prophets crying in the wilderness, and political campaigns based upon charges of corruption and privilege which everyone believed or suspected had some basis of truth, but which were largely unsubstantiated.” The solid reputation of McClure’s and its gifted stable of writers assured millions of Americans they could trust what they were reading.

, “If monopoly persists, monopoly will always sit at the helm of government. I do not expect to see monopoly restrain itself. If there are men in this country big enough to own the government of the United States, they are going to own it.”

Wilson worked to pass the Clayton Antitrust Act in 1914, strengthening the Sherman Act, and he created the Federal Trade Commission, which enforced the Clayton Act. In addition, under the impetus of the investigation of the Pujo Committee, led by Louisiana congressman Arsene Pujo, into the “money trust,” the spread of monopoly into the financial industry, Wilson moved to increase regulation of the financial sector. In 1913 he created the Federal Reserve Board, which would regulate monopolistic activities in the financial sector.

The immediate-shipment controversy engendered mutual enmity, for Rockefeller saw the producers as so many ingrates and malcontents whose oil was worthless without his superefficient United Pipe Lines system, which would soon be connected to twenty thousand wells. He mockingly described his foes’ attitude as follows: “We have disregarded all advice, and produced oil in excess of the means of storing and shipping it. We have not built storage of our own. How dare you refuse to take all we produce? Why do you not pay us the high prices of 1876, without regard to the fact that the glut has depressed every market?”

The episode convinced Rockefeller that the producers nursed an unreasonable hostility against him, and this inoculated him against even valid criticism. But unlike the producers, Standard Oil paid no real penalty for the Bradford crisis and in 1878 declared an impressive $60 dividend on shares with a $100 par value. Rockefeller had positioned himself exactly where he wished to be—poised to profit from either surplus or scarcity and all but immune to the vagaries of the marketplace.

A chemistry is performed so that a chemical reaction occurs and generates a signal from the chemical interaction with the sample, which is translated into a result, which is then reviewed by certified laboratory personnel.”

Those sounded like the words of a high school chemistry student, not a sophisticated laboratory scientist. The New Yorker writer had called the description “comically vague.”

When I stopped to think about it, I found it hard to believe that a college dropout with just two semesters of chemical engineering courses under her belt had pioneered cutting-edge new science.

Sure, Mark Zuckerberg had learned to code on his father’s computer when he was ten, but medicine was different: it wasn’t something you could teach yourself in the basement of your house. You needed years of formal training and decades of research to add value.

There was a reason many Nobel laureates in medicine were in their sixties when their achievements were recognized.

This firm represents Theranos, Inc. (“Theranos” or the “Company”). We have reason to believe that you have disclosed certain of the Company’s trade secrets and other confidential information without authorization. We also have reason to believe that you have done so in connection with making false and defamatory statements about the Company for the purpose of harming its business. You are directed to immediately cease and desist from these activities. Unless this matter is resolved in accordance with the terms set forth in this letter by 5:00 p.m. (PDT) on Friday, July 3, 2015, Theranos will consider all appropriate remedies, including filing suit against you.

Acknowledgments This book, which flowed from my work exposing the Theranos scandal in the pages of the Wall Street Journal, would not have been possible without the help of the confidential sources who spoke to me at great personal peril throughout 2015 and 2016. Some, like Tyler Shultz, have since gone on the record and appear under their real identities in the narrative. Others appear under pseudonyms or are mentioned only as unnamed sources. All were moved to talk to me, despite the legal and career risks they faced, by one overriding concern: protecting the patients who stood to suffer harm from Theranos’s faulty blood tests. I will forever be grateful to them for their integrity and their courage. They are the true heroes of this story. This book would also not have been possible without the dozens of other former Theranos employees who overcame their initial skittishness to share their experiences with me and help me reconstruct the company’s fifteen-year history. To a person, they were generous with their time and incredibly supportive of this endeavor. I’m also indebted to the laboratory experts who schooled me in the arcane but fascinating science of blood testing. One of them, Stephen Master of Weill Cornell Medical Center in New York, was kind enough to review the manuscript before publication to help me avoid errors. This book started with a tip in early 2015. I would like to thank the person who gave me the long leash and the unflinching support I needed to follow that tip where it led: my editor at the Journal, Mike Siconolfi. Mike has been a mentor, not just to me but to generations of reporters, and is a standard-bearer for the great journalistic institution that is the Wall Street Journal . Mike wasn’t my only ally in the quest to bring these events to light: Jason Conti, now Dow Jones & Co.’s general counsel, and Jacob Goldstein, his deputy, spent countless hours vetting my reporting and batting back the legal threats made by Theranos’s lawyers. I also owe a big debt of gratitude to my investigative team colleague Christopher Weaver, who helped me cover the regulatory inquiries and other fallout for more than a year, including during a stretch when I was on book leave. One of the dividends of working at the Journal has been the friendships I’ve made there over the years. One of those friends, Christopher Stewart, has written several nonfiction books and generously shared with me both his publishing industry expertise and his contacts. It’s through Chris that I met my agent, Eric Lupfer of Fletcher & Company, who immediately saw the potential of this project and pushed me to pursue it despite various obstacles that sprang up along the way. Eric’s perpetual optimism was contagious and the perfect antidote for my moments of doubt. I am very lucky that this book landed at Knopf and in the deft hands of Andrew Miller. Andrew’s enthusiasm and his unshakable faith in me gave me the confidence I needed to bring it to fruition. I’m also humbled to have had the support of Andrew’s boss, Knopf Doubleday Publishing Group chairman Sonny Mehta. From the moment I entered the Random House Tower, Andrew, Sonny, and their colleagues welcomed me and made me feel at home. I hope I have lived up to their expectations. This saga has consumed the last three and a half years of my life. Through it all, I have been fortunate to be able to rely on the advice, support, and warmth of friends and family. Ianthe Dugan, Paulo Prada, Philip Shishkin, and Matthew Kaminski—to name but a few—provided frequent encouragement and much-needed comic relief. My parents, Jane and Gérard, and my sister, Alexandra, cheered me on to the finish line. But by far my greatest source of strength and inspiration came from the four people with whom I share my life: my wife, Molly, and my three children, Sebastian, Jack, and Francesca. This book is dedicated to them.

In a press release it posted on its website, the company called the story “factually and scientifically erroneous and grounded in baseless assertions by inexperienced and disgruntled former employees and industry incumbents.” It also let it be known that Holmes would appear on Jim Cramer’s Mad Money program that evening to rebut the allegations.

We knew that the battle was far from over and that Theranos and Boies would be coming at us hard in the following days and weeks. Whether my reporting stood up to their attacks would largely depend on what actions, if any, regulators took. Rumors had been circulating among former Theranos employees of an FDA inspection, but I hadn’t been able to confirm it by the time we went to press. I had called my source at the agency several times but hadn’t been able to reach him.

Only a free press could check abuses of executive power, Hamilton asserted. He never mentioned Jefferson directly, but the president’s shadow flickered intermittently over his speech. In describing the need for unvarnished press coverage of elected officials, Hamilton reminded the judges “how often the hypocrite goes from stage to stage of public fame, under false array, and how often when men attained the last objects of their wishes, they change from that which they seemed to be.” In case any auditors missed the allusion, Hamilton added that “men the most zealous reverers of the people’s rights have, when placed on the highest seat of power, become their most deadly oppressors. It becomes therefore necessary to observe the actual conduct of those who are thus raised up.”

By spotlighting the issue of intent, Hamilton identified the criteria for libel that still hold sway in America today: that the writing in question must be false, defamatory, and malicious. If a published piece of writing “have a good intent, it ought not to be a libel for it then is an innocent transaction.”