CONFIDENCE 
 
 OR 
 NATIONAL 
 
 SUICIDE 
 
 By Arthur EStilwell 
 
iqiO 
 
 CORNELL 
 
 UNIVERSITY 
 
 LIBRARY 
 
 FROM 
 
 Wm. Sulzer 
 
DATE DUE 
 
 Cornell University Library 
 HE2757 1910 .S85 
 
 Confidence, or national suicide? 
 
 oiin 
 
 3 1924 030 125 029 
 
Cornell University 
 Library 
 
 The original of tiiis book is in 
 tine Cornell University Library. 
 
 There are no known copyright restrictions in 
 the United States on the use of the text. 
 
 http://www.archive.org/details/cu31924030125029 
 
Confidence, or National 
 Suicide ? 
 
 ARTHUR EDWARD STirLWE: 
 
 THIRD EDITION 
 
 NEW YORK 
 
 THE BANKERS PUBLISHING COMPANY 
 
 1910 
 
Oopyright 1910 
 "*" By .' 
 
 Arthur Edward StilweU 
 New York 
 
CONTENTS 
 
 CONDITIONS— PAGE 
 
 Preface v 
 
 A Protest 3 
 
 Our Country 13 
 
 The Englishman 21 
 
 Mexican Officials as Confidence Builders 29 
 
 On Which Side of the Fence is the Water? 37 
 Where is the Water in the Great 
 
 Northern ? 45 
 
 ERRORS— 
 
 American Wolves 55 
 
 "Grabitis" 63 
 
 Are You a Lion or a Zebra ? 69 
 
 Our Financial Apaches 77 
 
 REMEDIES— 
 
 State Contracts 85 
 
 The Corporation Court 97 
 
 Fixed Traffic Rates for Fifteen Years. . . 103 
 
 An American Legion of Honor Ill 
 
 Let Us Be Fair! 117 
 
A 
 
 Respectfully Dedicated 
 
 to 
 
 GEORGE W. WESTINGHOUSE 
 
 Avhom I consider one of the greatest Ameri- 
 cans, and to whom the world owes a debt 
 of gratitude for the air brake and other 
 inventions. 
 
PREFACE 
 
 'T^HE following collection of notes is issued at 
 the request of friends, with the hope that 
 the publication may call attention to problems 
 which are confronting the people of our country 
 to-day, and which are threatening peril to Ameri- 
 can railroads. 
 
 While considering this subject, reference will 
 be made to other matters, which are related to 
 and influence the investment market of our coun- 
 try, and I shall also lay stress on some points, 
 which I believe have not been mentioned by other 
 writers. 
 
 Readers of these notes may say that I, being 
 a railroad man, am prejudiced. However, I offer 
 my observations, hoping they will prove of some 
 worth. 
 
 Is there a more important calling than that of 
 a railroad constructor ? Is there any achievement 
 more helpful to the Nation than the building of 
 a railroad; opening up a virgin territory; devel- 
 oping a new country ; making farm lands advance 
 in value from five to thirty dollars an acre; for- 
 cing new towns to spring up, where happy, healthy 
 
school children greet us; witnessing the division 
 into farms of great territories heretofore devoted 
 to ranching? No occupation could be more grat- 
 ifying than this, which brings with it the feeling 
 that through the power which God has given us, 
 we have been able to create hpmes for thousands 
 of settlers ; we have been able to watch the young 
 men, with a few hundred dollars, venture forth 
 into a virgin country, soon becoming prosperous 
 merchants or successful business men; and to 
 witness the growth of these newly-risen towns 
 to three or five thousands of inhabitants, with 
 schools and prosperous business establishments. 
 
 It is given to but few to realize the great 
 satisfaction that comes to railroad builders, offi- 
 cials, stockholders and associates, who know they 
 are bringing growth, strength, and wealth, not 
 alone to the individual, but to the Nation. 
 
 Notwithstanding the great benefits that rail- 
 roads bring to the country, are they now to be en- 
 joined by adverse legislation? In some States 
 new railroads cannot be undertaken, or, if imder- 
 taken, have to struggle for their very existence 
 by the low rates imposed by the State Railroad 
 Commission, which forces railroads to operate 
 at less than cost, not counting interest on invested 
 capital. 
 
It is time for the people of America to resent 
 the attacks that are being made on railroads, 
 and efforts that are organized to reduce traffic 
 rates, — now that labor demands higher wage, and 
 cost of material has advanced. 
 
 If we but bring the facts before the American 
 public, the progressive people without doubt, are 
 in the majority, and will demand justice. They 
 will insist that the railroads shall share in the 
 prosperity lately enjoyed by business and labor. 
 
 The general discrediting of railroad invest- 
 ments by state and federal officials must stop, for 
 on the success of railroads the life of the business 
 world depends. There can be no national welfare 
 until railroads prosper. In order that the rail- 
 roads may prosper, millions of dollars are needed 
 for extension and betterment. Confidence must 
 be established or money for development cannot 
 be secured. 
 
 The failure of late efforts of American rail- 
 roads to raise traffic rates is a national calam- 
 ity! Labor demanded increase of wages; the 
 cost of living advanced, — ^but why? Not be- 
 cause of higher prices alone, but the people have 
 adopted luxuries which they formerly did not 
 demand. Consequently employees claimed in- 
 creased wages. This was granted. I understand 
 
 vii 
 
that the New York Central's pay-roll shows an 
 annual increase of six million dollars and that of 
 the Erie of about two million dollars. 
 
 As the matter appears to me, the government 
 was Avilling to allow an increase in traffic rates to 
 offset the increase in wages, until a general pro- 
 test came from shippers. The rate increase was 
 enjoined, and afterwards referred to the Inter- 
 state Commerce Commission. 
 
 I do not believe that it really was the shippers 
 who objected, but the secretaries of various Com- 
 mercial Clubs who saw an unusual opportunity 
 for a "big noise," which they had not had for a 
 long time. They were employed to watch rail- 
 roads, and realized that here was a chance they 
 must not forego. 
 
 Nearly all railroads need to procure funds for 
 development by additional issues of securities; 
 the wonderful growth of business in the United 
 States demands extensions and improvements. 
 Stop railroad development, and you paralyze the 
 wheels of progress! Part of the money which 
 railroads had secured for development is now 
 being used for payment of increased wages; 
 therefore, many extensions and improvements 
 are postponed. 
 
CONFIDENCE, OR NATIONAL 
 SUICIDE? 
 
A PROTEST 
 
 'T^HE late financial disturbance in the United 
 States was uncalled for and, I believe, 
 might have been avoided by the exercise of good 
 judgment and tact. 
 
 Wide acquaintance in Europe, and experience 
 in building railroads in the United States and 
 Mexico, — ^incidentally developing new territory; 
 opening and platting a hundred new towns, now 
 with an aggregate population of two hundred 
 thousand, — have given me a varied view of life, 
 ranging from the counting room of a London 
 bank, to frontier life in the United States, an 
 experience which, perhaps, comes to but few men. 
 
 Out of love for my own country, has grown a 
 great desire to see it come into its own. The 
 calamitous evil in the United States of attempt- 
 ing to gain money by tricky methods, is so appar- 
 ent abroad that everyone should realize it at 
 home. An awful example was the exposure of 
 the false scales of the Sugar Trust. 
 
 Foreign investors during the last four months 
 
4 CONFIDENCE 
 
 have withdrawn from contemplated purchases of 
 one hundred and thirty million dollars of our 
 railway bonds. This money was greatly needed 
 for proper development and improvement of our 
 railway facilities. These millions would have 
 come to America, were it not for the poisonous 
 streak of bitter radicalism which yet lingers in 
 the United States regarding railroads, and the 
 sinful warfare waged by bear raiders, harming 
 all American property. 
 
 New York journals, recently, have been un- 
 tiring in their Herculean efforts to uphold Amer- 
 ican confidence (credit). 
 
 There is no sane reason for the present slump 
 in American securities; general financial condi- 
 tions are not bad; crops are nearly normal; we 
 lead the world as to the most important manu- 
 factures — steel, iron and cotton; the balance of 
 trade is in our favor; all nature is bountiful! 
 
 Destructive radicalism started the panic of 
 1907 — a devastating electric storm flashing from 
 out the clear sky ! Adverse conditions can always 
 be bravely faced by Capital without complaint, 
 but radicalism it cannot withstand. 
 
 We must not let radicalism put its weapons 
 into the hands of the bear raiders ! 
 
OR NATIONAL SUICIDE? 5 
 
 The Democratic Gubernatorial Nominee of 
 Texas has just expressed himself as opposed to 
 radicalism — a sign of the times presaging bless- 
 ings for that commonwealth. 
 
 Notwithstanding these conditions are appar- 
 ent, there seems to be such apathy regarding 
 them, that I have been prompted to write this 
 protest. We have seen speculators by "bear" at- 
 tacks, time after time, accumulate questionable 
 fortunes. We have seen men, after years of 
 effort, upbuilding great enterprises, wrecked by 
 a handful of skilled manipulators and politicians. 
 
 I am appalled by the popular indifference to 
 such methods and fear a protest is useless. I re- 
 call that years ago out West, we hung people for 
 stealing horses and succeeded in cleaning up the 
 country of its boldest outlaws. These men, how- 
 ever, only occasionally held up a train, robbed a 
 bank here and there, and incidentally burned a 
 few houses. 
 
 The crimes against which this protest is made 
 are committed with impunity every day, and our 
 nation is under a greater obhgation to wipe them 
 out, than it was to kill outlawry in the West. We 
 have done away with the great evil of railroad 
 rebating, and some day may hope to see stock- 
 
6 CONFIDENCE 
 
 market raiding and kindred crimes, prohibited by 
 law. We may then realize that for the nation, 
 as well as for the individual, honesty as a policy 
 is best. 
 
 It is far better to profit by building up confi- 
 dence in the nation and attracting foreign money, 
 which naturally seeks an outlet in American in- 
 vestment, than to make a few paltry millions by 
 tricks or bear raiding. The leading cause of our 
 present unfortunate financial condition is the pop- 
 ular belief that there is no other road to political 
 preferment than, in some way, to destroy vested 
 capital in railroads and industrial enterprises. 
 Trend in this direction during the last eight years 
 has been so evident, that people 'will believe al- 
 most any derogatory financial statement. 
 
 The investor has been hit so hard in the past 
 eight years that he is "jumpy" regarding his in- 
 vestment; the awful panic and depression of 
 1907-1908 left such a vivid impression that cap- 
 ital now fears shadows. When the slightest sug- 
 gestion of adverse legislation arises, the purse 
 strings of capital are drawn tight. If, in some 
 way, legislation could be enacted which would re- 
 store confidence in the future of our railroads; 
 if bear raiding could be eliminated; we soon 
 
OR NATIONAL SUICIDE? 7 
 
 would achieve the greatest possible, national 
 prosperity. 
 
 There is, to-day, need for the expenditure of 
 milUons in the railroads, industries, etc. ; yet cap- 
 ital is afraid. This fear must be removed or we 
 will soon enter on a period of great depression; 
 if not actual disaster. We are at the forks of the 
 road; which way shall we turn? 
 
 I. hope this protest will help point the way 
 toward improved conditions. We have not a 
 foreign foe to fear; the foe is within. There are 
 politicians who hope to rise to power, by attack- 
 ing invested capital, and "bear" raiders who will 
 destroy values, or property, or wreck banks, 
 merely for personal gain. If any foe from with- 
 out, should undertake to destroy property to the 
 extent of one-fourth of the harm now accom- 
 plished by foes within, we would impeach a Presi- 
 dent who failed to call out the Army and Navy 
 in defense. 
 
 Now is the hour for prompt action, and I hope 
 the time has come when there will be some other 
 way to achieve greatness in political life than by 
 "knocking" vested capital. I hope the day will 
 come when we will hall-mark our stocks and 
 bonds as silver is stamped sterling in England. 
 
8 CONFIDENCE 
 
 The day will come when we in general will com- 
 prehend that a man cannot be a true American 
 who makes his milKons by destroying financial 
 confidence. The day will come when to enter 
 political Hfe will be an honor, as it is in England, 
 and not a joke, as is often the case here. 
 
 No nation has greater opportunities for gain, 
 than the United States, by the upbuilding of con- 
 fidence in business methods and financial institu- 
 tions. 
 
 The investment money of the world would flow 
 through our gates if more upright methods were 
 adopted here. 
 
 We have wide, undeveloped territory to popu- 
 late; many additions to make to our railroads. 
 Eight or ten years, marked by freedom from bear 
 raids and from political unrest, would give the 
 United States a growth in business and financial 
 standing beyond power of description. To secure 
 these great results, it is needed that truth shall 
 prevail and that we shall have straight business 
 methods. No condition need be colored. The 
 truth is strong enough. 
 
 But why should foreign money come here, if, 
 each year, our leading financiers and politicians 
 attempt to create losses in the market value of the 
 
OR NATIONAL SUICIDE? 9 
 
 very securities which they sold the year before, 
 gilded with glowing promises? Were they de- 
 ceiving investors then or now? We need only 
 look to the wonderful development now taking 
 place in Canada; two railroads building to the 
 Pacific; railroad extension of all kinds; wonder- 
 ful growth in population, alluring thousands of 
 our people; new cities springing into existence; 
 milhons for investment pouring in, — and why? 
 The Government is aiding railroads, guarantee- 
 ing interest on loans. It is easy to secure money 
 for railroads when the Government is fair, and 
 hence this great growth and the greatest era of 
 prosperity Canada has ever known, side by side 
 with fear and stagnation in this adjoining land. 
 
OUR COUNTRY 
 
OUR COUNTRY 
 
 "l^TE live in a wonderful land, blessed as is no 
 ' ^ other, a land of wide extent and various 
 climates. The Scandinavian or Teuton may find 
 the Northwest suited to him; the Italian, the 
 South. The soil varies so that nearly everything 
 which can be grown is to be found in some part of 
 the country. It yields all metals, and ranks sec- 
 ond in the world in the production of gold, and 
 first as to iron and steel. Our crops annually 
 are valued at some eight billions of dollars. 
 
 The United States increases nearly one hun- 
 dred and thirty thousand per month in pop- 
 ulation. If you should <read in the paper that all 
 the inhabitants of Holland and Belgium were to 
 immigrate into the States in five years, it would 
 make a great impression on your mind, yet our 
 increase in population would in five years equal 
 the population of those countries. 
 
 Our growth in numbers, in the last ten years, 
 is equal to one-third the population of Great 
 Britain. We are a mixed race, containing the 
 best blood of all nations; that is, the young and 
 vigorous come here. 
 
 We are not like some nations, finished ; we are 
 
 13 
 
14 CONFIDENCE 
 
 in the making. Our inhabitants breathe an at- 
 mosphere of business activity. They are sur- 
 rounded by new buildings, engaged in new enter- 
 prises, and trying to become accustomed to new 
 inventions. 
 
 No one will talk to an idle man, so if you want 
 to retire from business, you find you must go to 
 Europe in order to talk to someone. Oppor- 
 tunities exist on every hand; we grow great trees; 
 erect high buildings; build great railroads; hav^ 
 big panics and big booms; we make great mis- 
 takes quickly, and sometimes rectify them just as 
 quickly. We are so engrossed in the fight for 
 gold that we do not always give as much thought 
 as we should to a matter before we act; we are 
 impulsive, but in the long run, will be found on 
 the right side. 
 
 There is endless chance for the investment of 
 capital; for years, foreign money has poured in 
 on us, yet we need more. Progress creates pro- 
 gress. There are good reasons why we need cap- 
 ital, a few of which I will mention. To keep this 
 country on top, we must pay more attention to 
 building up confidence, and less to "YAP." The 
 word is perhaps vulgar, but I cannot find any 
 other that better expresses my meaning. 
 
OR NATIONAL SUICIDE? 15 
 
 "Yap" is talk, without truth back of it; 
 "Yap," is shouting baleful ideas which you do 
 not believe; it is the talk of politicians who are 
 attempting to impress upon their hearers the idea 
 that their lives are the essence of the ten com- 
 mandments, when they know that they have 
 broken nine and hopelessly cracked the tenth. 
 "Yap" is the great asset of the bear raider, who is 
 doing aU in his power to destroy confidence in 
 America and American investments, and has in 
 view the lining of his own pockets with ill gotten 
 gains. He is willing to say or do anything, in 
 order to destroy any sacred structure in his way, 
 if it will only add to his gains. Of late, "Yap" 
 has had full swing, and while it has tried to sway 
 our nation into wrong paths, it cannot mislead it 
 forever. It will soon be recognized for what it is 
 and then will have no more power than "the 
 voiceless lisping of a gas leak." 
 
 The United States can furnish most attractive 
 investments for foreign capital, if we do not scare 
 it by destroying confidence in the nation. For- 
 eign capital will buy our stocks and bonds in 
 large blocks, and why not? All Europe sees the 
 American; he fills the hotels; he furnishes sixty 
 per cent, of all the first-class traffic on the rail- 
 
16 CONFIDENCE 
 
 road and steamship lines during the travel sea- 
 son ; he buys with a liberal hand. Europe blesses 
 him each season, when the travel tide is turned 
 that way. The European sees the Americans 
 in the light of a liberal and generous people; 
 he knows the prosperity that American money 
 brings to his shops, hotels, etc., and he will, in 
 turn, invest his money with us, if we will build 
 up national confidence. We need his money, and 
 it will be a great error, if we see this capital di- 
 verted elsewhere, as is now the case. 
 
 Here are a few reasons why trade balances 
 will be against us ; first, owing to large home in- 
 crease in population, in the next decade, the last 
 cargo of wheat will have left our shores; we will 
 need it all at home, and will be forced to import 
 wheat from Canada and the Argentine. Sec- 
 ond, the widening stream of Americans going 
 abroad each year will continue to increase, year 
 by year. It is now difficult to book steamship 
 passage, during the travel season, in spite of the 
 constantly increasing number of ships. This for- 
 eign travel sends abroad over three hundred mil- 
 lion dollars each year. Our rich young women 
 who marry foreign titles, carry abroad yearly, a 
 sum that runs far into the mill'ns. We will 
 
OR NATIONAL SUICIDE? 17 
 
 export less and less cotton, for two reasons, — 
 greater demand at home because of increased pop- 
 ulation, and increase in the production of cotton 
 along the Nile and in Central Africa and India. 
 AH efforts possible in those countries are being 
 made by English cotton manufacturers, in order 
 to free the English market from the wildly fluc- 
 tuating American cotton market. 
 
 Another adverse force to which little thought 
 is given, is that millions of dollars are exported 
 to the old-world homes of immigrants. Much 
 money is taken abroad each year by Italians, who 
 never expect to return. Any railroad contractor 
 wiU tell you that the money paid to his Italian 
 laborers (less that which is used for living ex- 
 penses) is withdrawn from circulation; all the 
 Italian saves, goes into his belt, and remains there 
 until he returns to Italy. 
 
 An Italian stated to one of our shareholders, 
 on one of the islands south of Italy: — "With 
 four good chestnut trees furnishing my flour, and 
 with four goats, I can live well, and support my 
 family; so why longer remain in the United 
 States, after earning money with which I can buy 
 the trees and the goats?" This behef annually 
 removes millions of dollars from our country. 
 
18 CONFIDENCE 
 
 Such drains must be offset in either one of two 
 ways; by increased sale of manufactured goods, 
 or by sale of our securities. 
 
 We are not doing our duty toward capturing 
 the trade of South America. We plaster it over 
 with the Monroe Doctrine in words, but the Eng- 
 lish and German nations capture it with their 
 trade. We hold the Monroe Doctrine in our 
 dreams, while the foreigners get the business. 
 
 There is left to us the sale of our bonds and 
 shares in the markets of the foreign world, as our 
 interest rates are more attractive to the foreigner 
 than to our own investors, money here being in 
 such active demand. 
 
THE ENGLISHMAN 
 
THE ENGLISHMAN 
 
 "Others may use the Ocean as their road; 
 Only the English make it their abode, — 
 Whose ready sails with every wind can fly 
 And covenant make with the inconstant sky." 
 
 'T^HE Englishman is the most successful colon- 
 izer and settler that the world has ever 
 known. He governs one-fifth of it and rules 
 over one-fourth of the population. 
 
 He thinks in continents. 
 
 Enghsh universities and her Church have im- 
 pressed their mark on the world. 
 
 Wherever the English flag flies, investments 
 are safe. Of chief importance, his Government 
 is clean. 
 
 Everywhere he is the pioneer and his flag flies 
 in every port of the world. 
 
 He lands in New Zealand, teaches the natives 
 to plant and grind grain, and soon New Zealand 
 is part of the Empire. He founds a convict 
 colony at Botany Bay, adding a new continent 
 to the realm. He founds the East India Com- 
 pany, wrests the trade of that Empire from the 
 
 21 
 
22 CONFIDENCE 
 
 Dutch and Portuguese, bringing home the wealth 
 of India. 
 
 He develops, explores and colonizes Canada 
 and the Northwest by founding the Hudson Bay 
 Company, and the steel ribbon of his railway ex- 
 tends from Halifax to Vancouver. 
 
 He explores the wilds of Russia; penetrates 
 Thibet, reaching the forbidden city of Lhassa; 
 penetrates to within a hundred miles of the South 
 Pole. 
 
 The Englishman marches into unexplored 
 regions, makes terms with the native chief, and 
 the flag of England flies over one more pro- 
 tectorate; the light of civilization arises from the 
 earth that had reeked with the blood of victims 
 captured in war; in after years, the son and 
 grandson of this bloody chief study in Enghsh 
 schools, to carry the seed of education to germi- 
 nate in their old homes, there implanting the love 
 of the English flag, and the progress for which it 
 stands. 
 
 He fishes for pearls in India; grinds into paper 
 pulp the spruce of Newfoundland; makes soap 
 in Holland; erects packing houses in Uruguay 
 and Paraguay; bottles waters in Germany and 
 brews beer in Brazil. 
 
OR NATIONAL SUICIDE? 23 
 
 The Englishman herds sheep in Australia and 
 New Zealand; penetrates the forests of Brazil 
 for rubber and plants it in Ceylon; plants cotton 
 on the highlands of Central Africa; sails the Nile 
 and reclaims its lost tracts of desert, to yield a 
 thousand fold; grows tea in Ceylon and India, 
 spans its torrents, and explores its fastnesses with 
 rails of commerce. 
 
 He institutes banks in all new countries with 
 branches in London, and his Bank of England 
 fixes the discount rate for all the world. 
 
 The Englishman drills for oil in India, Russia, 
 Persia, the States and Mexico; builds refineries 
 and establishes steamship lines for carrying oil to 
 all continents. 
 
 He digs for coal in China; mines nitrates in 
 Peru; prospects for ore in Russia; delves in the 
 mines of the Rand; redeems West Africa, and 
 opens its treasure house of gold. 
 
 He builds great sewerage systems and docks in 
 Mexico, wharves in Uruguay, and equips the 
 cities of Argentine with trams and electric lights. 
 
 The EngUshman harnesses the water-falls of 
 Brazil and Mexico and furnishes electric light 
 and power to their cities. He operates trams in 
 Calcutta, constructs railroads in Turkey, and 
 controls the Suez Canal. 
 
24 CONFIDENCE 
 
 He spans Tehuantepec, linking the Atlantic 
 with the Pacific; owns the railroads of Peru; 
 climbs the Andes and connects the Argentine 
 with Chili; and realizing Cecil Rhodes' dream, 
 runs a railway from Cape to Cairo. 
 
 Such is the Englishman ; his word is his bond ; 
 he is square in his dealings. All he wants is his 
 share. He is a sportsman, loving horses, cricket 
 and football. Worcestershire sauce, evening 
 dress, and Bass' ale follow the English flag. 
 
 He does not care for great wealth and knows 
 when to retire, not to die in harness. He is the 
 best friend in the world and, once you win his con- 
 fidence, it is your fault if you do not keep it to 
 the end. 
 
 He trades in every clime; he has been God's 
 right hand agent in hastening the hands of 
 progress. 
 
 Macaulay says: — "The history of England is 
 the history of progress." 
 
 The numerous tongues disseminated after the 
 fall of the Tower of Babel are being more and 
 more unified, as English is becoming the lan- 
 guage of the commercial world. 
 
 The Englishman has millions of money in our 
 enterprises and is willing to invest more. 
 
OR NATIONAL SUICIDE? 25 
 
 We speak his tongue; we inherit his daring. 
 
 England is for millions of us the home of our 
 ancestors; we glory in this, but we need never 
 imagine that New York may wrest from London 
 its great power as the financial center of the 
 world, unless New York adopts some of Lon- 
 don's strict integrity in business. 
 
 Then and not till then, may New York achieve 
 this world distinction. 
 
MEXtjCAN OFFICIALS AS CONFI- 
 ^ DENCE BUILDERS 
 
MEXICAN OFFICIALS AS CONFI- 
 DENCE BUILDERS 
 
 1%^" EXICAN officials have been most success- 
 ful in building up national confidence. 
 What great difficulties have been overcome there 
 in the last thirty years! Thirty years ago there 
 was scarcely any foreign money invested in Mex- 
 ican securities, and now we find one billion five 
 hundred million dollars foreign capital there 
 placed and nowhere is foreign money more 
 secure. 
 
 What a number of cases can be cited to illus- 
 trate this! I will mention two which have come 
 under my personal observation. Eight years ago 
 a branch railroad in Mexico was offered to me 
 on favorable terms. A syndicate was ready to 
 take it, if I could connect it with the Orient rail- 
 way. To do that, I had to traverse part of the 
 territory of the Mexican Central Railroad. I 
 went to President Diaz, to ask him for the con- 
 cession, little thinking of anything except the fact 
 that this would be a very favorable railroad con- 
 nection for us to make. I did the best in my 
 
 29 
 
30 CONFIDENCE 
 
 power to lay the case before him, in the light in 
 which I saw it. He listened to me and then point- 
 ing on a map said thoughtfully, "Senor Stil- 
 well, you do not wish this! To make your con- 
 nection, you have to enter the Mexican Central 
 territory, through a section where there is not 
 very much business. You would hurt the Mexi- 
 can Central Road, and would, perhaps, help your 
 own road for the time being; but you cannot hurt 
 any Mexican investment without injuring your 
 own road in the long run. No, there is plenty 
 of chance for investment of capital in Mexico, in 
 sections that need development and where in- 
 vested capital will not be hurt. Use your energy 
 in those sections, but do not ask me for conces- 
 sions that would in any way injure invested cap- 
 ital or make its burden greater." 
 
 This was a rebuke and the matter was dropped, 
 yet very often in the past few years I have re- 
 called the incident and wondered what our future 
 would be if the people in power in the United 
 States would so guard as a sacred trust, the in- 
 terests of invested capital. 
 
 One more illustration! A trust company in 
 the States had a large portion of its money locked 
 up in bonds of a railroad in Central Mexico, 
 
OR NATIONAL SUICIDE? 31 
 
 During one of the biennial panics to which the 
 United States is subject, this company failed with 
 five million dollars of these bonds as one of its 
 assets; the Mexican Government at once guar- 
 anteed the bonds and the trust company was able 
 to liquidate. Effort was not made to crush the in- 
 vestors and save a million for Mexico, but every- 
 thing possible was done to prevent anyone losing 
 on a Mexican investment. How different it 
 would be in New York ! 
 
 The Mexican Government bought control of 
 the majority of the stock of the Mexican Nation- 
 al Railway and with the support of the Govern- 
 ment it was easy for the road to raise money. In 
 addition to the backing of the Government, the 
 road was. fortunate, in having Mr. E. N. Brown, 
 a railroad man of great and recognized ability 
 as its president. The policy pursued by the man- 
 agement soon put the road in excellent shape, 
 both physically and financially. Then the Gov- 
 ment turned its attention to the Mexican Central, 
 which had been at the end of its string for money, 
 and purchased the controlling interest. It is my 
 conviction that the Government took hold of the 
 Central, not alone for the future of the road, but 
 because President Diaz and Secretary Liman- 
 
32 CONFIDENCE 
 
 tour, one of the greatest living financiers, believed 
 that Government intervention was the only thing 
 that Vi^ould avert a receivership. They were un- 
 vi^illing that such a disaster should overtake a 
 prominent Mexican road and weaken the con- 
 fidence of the investors of the world in Mexican 
 investments. 
 
 Another reason for the assurance placed in 
 Mexican investments by foreign investors, is the 
 fact that the Government has bought control of 
 a majority of the stock of sixty per cent, of the 
 railroads of Mexico. This always will prevent 
 injury to railway investors and is a wonderful 
 tribute to the men at the head of the Mexican 
 Government, that in so short a time, full confi- 
 dence there has been established. 
 
 I have had the pleasure of personally intro- 
 ducing over fourteen hundred American and 
 English business men to President Diaz, Vice- 
 President Corral and Secretary Creel, and have 
 noted with gratification the favorable impression 
 these officials made on my friends. 
 
 I rejoice that it has fallen to my lot to aid in 
 cementing a friendship between the United States 
 and Mexico and to help develop, in a small way, 
 the resources of that wonderful country, which 
 
OR NATIONAL SUICIDE? 33 
 
 has no politician hoping to achieve power by the 
 destruction of investments and confidence. In 
 Mexico bear raids and short selling are unknown. 
 The Mexican President is a wise business man. 
 I believe that few men ever walked the earth, who 
 possessed the business sense, high honor and re- 
 markable judgment and foresight of President 
 Diaz. 
 
 If people of the United States would elect as 
 President a great business man, such as the late 
 Marshall Field, or Andrew Carnegie, I think it 
 would be found that such a business mind would 
 be a valuable asset to the nation. Why do we not 
 elect a business man to the Presidency? 
 
ON WHICH SIDE OF THE FENCE IS 
 THE WATER? 
 
ON WHICH SIDE OF THE FENCE IS 
 THE WATER? 
 
 /^NE of the favorite remarks of those who 
 ^^ want to fight the railroads is : — "We must 
 squeeze the water out of the railroads, so that 
 they will not pay dividends on it !" We will ad- 
 mit for argument's sake that there is water in the 
 railroads. Who wants to build railroads for the 
 fun of the thing? There are two classes of peo- 
 ple; optimistic and pessimistic; one sees the 
 doughnut, the other sees the hole. Without the 
 blessings conferred by the optimist, the dear old 
 pessimist would never have any place on earth in 
 which to invest his money, since he never creates 
 anything; he only buys what the optimist has 
 created, meanwhile finding fault with every new 
 work that the optimist undertakes. 
 
 Now let us analyze the water in the railroads 
 and see if it is not deeper outside, than inside the 
 railroad's right-of-way. It seems thus to me. 
 
 Note the Kansas City Southei-n which I built. 
 It is 800 miles long. It opened up sections of 
 country, where previously you could not give 
 
 37 
 
38 CONFIDENCE 
 
 the land away. Cities sprang up, which, during 
 ten years, have acquired a population of eight or 
 ten thousand and assessed values of millions. 
 The great coal belt, south of Fort Smith, was 
 opened up ; miles of long and short leaf pine ter- 
 ritory were brought into the market. This land 
 was sold for two dollars per acre before the road 
 went through; now it is sold for five dollars 
 per thousand stumpage, — or fifty to seventy- 
 five dollars per acre. Over a hundred mills n,ow 
 cut lumber in this territory. Thousands have 
 found occupation, where before there was no 
 business at all, through at least five hundred 
 miles of this territory. Two great oil fields have 
 been developed by the railroad. The coal lands 
 are now worth at least one thousand dollars per 
 acre; to this we must add increased value of 
 the oil and timber lands. Then there is the great 
 mineral belt south of Jophn ! Note the value of 
 town lots, where towns did not previously exist! 
 There is a strip of land, thirty miles wide, on 
 each side of the railroad, where the average in- 
 crease in values has been fourfold. The coal and 
 oil and the townsites add to this increase, which 
 I have no doubt will reach forty dollars per acre. 
 There are in this strip forty-eight thousand 
 
OR NATIONAL SUICIDE? 39 
 
 square miles or thirty million seven hundred and 
 twenty thousand acres. If it has increased in 
 value say but twenty dollars per acre, the gain is 
 six hundred and fourteen million four hundred 
 thousand dollars; all this brought to the public 
 by a railroad huilt by optimists. The railroad 
 created these new values while the owners slept! 
 
 Now suppose the railroad builders, in time, 
 make, through their judgment, fifty million or 
 seventy-five million dollars above the cost of the 
 road; do not capitahsts who have had the nerve 
 to bring such increased prosperity to this terri- 
 tory, deserve credit, reward and profit? 
 
 Is it selfish if the railroad builders ask that they 
 shall be rewarded with one-twelfth of what they 
 have made for others? Capital needs encourage- 
 ment. 
 
 If you want to squeeze the water out of the 
 railroads, do you also want to squeeze it out of 
 the land values? If it is not fair for railroads to 
 prosper, it is not fair that land values (which the 
 roads have created, ) shall increase. It is not fair 
 to deny the creator of those values unless we deny 
 the created. 
 
 What a howl would go up from owners of land 
 in this, or in any new railroad's territory, if the 
 
40 CONFIDENCE 
 
 Interstate Commerce Commission, or the State 
 Railroad Commission, were to fix the price at 
 which land could be sold! The increased real 
 estate values were made through the courageous 
 investment of capital which built the road. 
 
 Consider the good fortune conferred by the 
 Union Pacific in opening up the mining sections 
 of the West, adding millions of gold production 
 from mines which never could have produced be- 
 fore the advent of the road. 
 
 "Yes, there is "water," (if you call increased 
 value, "water"), in our railroads, — and thank 
 God for it ! It was the prospect of this increased 
 value which made possible the creation of rail- 
 roads. But rest assured; that the "water" added 
 to the value of the adjoining lands, (we will call 
 the increase in land values, "water," for it is as 
 fair in the one case as in the other) , is twelve 
 times the amount of the water in the railroad 
 securities! No objection is raised by land owners 
 along the railroad, whose properties have been 
 increased in value by the building of the railroad. 
 Is not the water deeper on the outside than inside 
 of the railroad's right-of-way? 
 
 I will cite another benefit derived from the 
 building of the Kansas City Southern. The ad- 
 
OR NATIONAL SUICIDE? 41 
 
 vent of the road enabled fifty thousand people to 
 find employment in mills, forests, stores, etc. The 
 average wage of each laborer is two dollars per 
 diem; here is one hundred thousand dollars a day, 
 increase in the earning capacity of American 
 men. This is thirty million dollars per annum. 
 Consider the benefit, conferred on all business, in 
 the creation of such an addition to the earning 
 power of labor. At least two hundred million 
 dollars found safe investment in this territory. 
 The railroad made Kansas City a great grain 
 market and a great lumber market. This one 
 railroad has increased the value of land six hun- 
 dred and fourteen million four hundred thousand 
 dollars; gives employment to labor to the extent 
 of thirty million dollars per annum; presents op- 
 portunity for the investment of two hundred mil- 
 lion dollars, in local industries, mines, and stores. 
 
 Do not the creators of such colossal values de- 
 serve "water," if that is the proper name for 
 profit? Does this railroad not deserve ample re- 
 turns and abundant profits from the people it 
 serves? 
 
 In England, men who created such properties 
 for the upbuilding of the nation would be 
 honored. 
 
42 CONFIDENCE 
 
 In the United States, however, the promoters 
 and builders are hounded. Tricks of all kinds are 
 tried, and dishonest methods employed, in at- 
 tempts to wrest the property from them ; methods 
 which would make Judas Iscariot look like an 
 archangel and put the forty thieves, with halos 
 among the saints. 
 
 Have not merchants, manufacturers and bank- 
 ers seen "water" come into their own business? 
 You are, we will say, a wholesale merchant. 
 Your business, stock and store have a value of one 
 million dollars, which is the asset value ; you earn 
 and pay dividends on two million dollars, consid- 
 ering your established trade and good name the 
 additional million, — and you would not sell out 
 for less. Is this extra milHon "water"? If it is 
 fair to earn dividends on this "water," is it not 
 fair also for the holders of railroad stocks to earn 
 on the "water" in their road? 
 
 Men who take financial risks are entitled to 
 profit ! If all the railroad bonds and shares were 
 guaranteed by the state or the nation, it would 
 be very different. Railroads assume great risks, 
 — of crop failures, damage by storms, etc. Fair 
 treatment and just rates are the necessary requi- 
 sites to attract investors, now sorely needed for 
 development of this expanding country. 
 
WHERE IS THE WATER IN THE 
 GREAT NORTHERN? 
 
WHERE IS THE WATER IN THE 
 GREAT NORTHERN? 
 
 'T^HE Great Northern Railroad has some 
 seven thousand miles of track. This was 
 the creative work of James J. Hill: his energy, 
 his foresight, and his alone, built this road. He 
 was laughed at, as I was when building the Kan- 
 sas City Southern, — pronounced a dreamer, and 
 the territory the road was to open was called a 
 desert. 
 
 The railroad men of his section said: "Wait 
 until ties must be renewed and then see where 
 he will be"! But Mr. Hill, like all men whom 
 destiny has chosen for such work, could see the 
 end, though no one else foresaw! It was the 
 prophetic vision of James J. Hill, (withheld from 
 others), which enabled him to keep up the fight, 
 midst crop failures, panics, slander, — and yet 
 live, striving to give service to the world. 
 
 James J. Hill, in building the Great Northern, 
 was positive that his message of prosperity and 
 beneficence was to be delivered at the Pacific 
 Coast. He carried the message to Garcia! And 
 
 46 
 
46 CONFIDENCE 
 
 what a message it was, written on the ground in 
 characters of steel! What a blessing it was for 
 that wonderful, unoccupied country! Cities 
 sprang up ; millions of acres responded to the song 
 of the plow ! Aladdin's lamp never produced so 
 wonderful a vision as this reality, — ^millions of 
 homes, great waving fields of grain! Giant 
 trees, that for centuries had resisted all stress of 
 seasons, and all foes, became the subjects of this 
 King of Commerce. Can you not see the pic- 
 ture? What benefits Hill conferred on the nation! 
 It was not a distant, intangible, protectorate; 
 not like the Philippines — over seas! Here was 
 an empire, within, yet added to our own sleep- 
 ing country! Let us admit, that what Hill had 
 done, some one else might accomplish at a later 
 day; but Hill was ten years in advance of the 
 times. Figures are cold, and words are weak to 
 tell the story. What a gift this was from one 
 empire builder! 
 
 The human mind scarcely can comprehend all 
 the benefits conferred through the building of the 
 Great Northern, but let us try to enumerate some 
 of these. 
 
 The Great Northern has seven thousand miles 
 of track. Figure that two thousand miles of this 
 
OR NATIONAL SUICIDE? 47 
 
 territory would have been developed by other 
 railroads, so in only five thousand miles of the 
 seven thousand is development credit strictly due 
 to Mr. Hill's enterprise. 
 
 Figure that the Great Northern has increased 
 land values but twenty dollars per acre in five 
 thousand miles of its territory. We will say that 
 land for only fifty miles on either side of the 
 track was increased in value. I am convinced, 
 considering increased values of all the cities and 
 towns brought into being by this road, and the 
 value of all the minerals and timber contained, 
 this increase should be estimated at double or 
 treble the above figure. To be conservative we 
 will only put the increase at twenty dollars per 
 acre. 
 
 Here is a section of land, five thousand by one 
 hundred miles, tributary to the Great Northern, 
 and in this territory are five hundred thousand 
 square miles or three hundred and twenty million 
 acres. Figure that this has increased twenty dol- 
 lars per acre in market value, since the advent of 
 the road; the increase would then amount to six 
 billion four hundred million dollars of wealth, 
 developed in the country by the untiring work 
 and energy of James J. Hill. 
 
48 CONFIDENCE 
 
 Estimate that Mr. Hill was only ten years in 
 advance of others in creating these values, and we 
 will not credit all the development to him; we will 
 only credit him with six per cent, simple interest 
 on these created values, for this ten-year period, — 
 which amounts to three billion eight hundred and 
 forty million dollars. Bear in mind that this is 
 just the interest for ten years, on what Hill 
 created in property and land values, in but five 
 thousand of the seven thousand miles of trackage. 
 
 If you earn sixty dollars a year you receive the 
 same increase as does a man investing one thou- 
 sand dollars at six per cent. Income is the an- 
 nual revenue from your time or from your in- 
 vested money. 
 
 Consider the wide territory awakened by the 
 Great Northern Railroad; the mines, cities, 
 farms and ocean commerce, — developed by Hill 
 and his Great Northern. 
 
 At least five hundred thousand people found 
 employment at good wages, by reason of this one 
 man's energy. If each only earns two dollars 
 a day, this is increased income for employed 
 labor, amounting to one miUion dollars a day; or 
 for three hundred days, three hundred million 
 dollars annually. This is six per cent, interest 
 
OR NATIONAL SUICIDE? 49 
 
 on five billion dollars. In other words, through 
 Hill's work, United States labor was able to earn 
 as much additional money as capital could earn 
 by the sound investment of five billion dollars. 
 
 It staggers the human mind to think that one 
 railroad, built by one man, could bring such help 
 to a nation. 
 
 Men from all corners of Europe swelled the 
 population of the United States; they emigrated 
 from Germany, France, Sweden, Norway, Eng- 
 land, Austria; brought their families, earned 
 good wage, — spent it here ! 
 
 What did these increased earnings of labor do 
 for our wholesale and retail trade? They secured 
 better returns for building material and for man- 
 ufactured goods. 
 
 Hill increased land values at least six billion 
 four hundred thousand dollars and the annual 
 value of labor three hundred million dollars 
 annually. 
 
 I have noted two of the many benefits con- 
 ferred by the Great Northern; increased land 
 values and increased income for labor. 
 
 The third benefit is, opportunity offered for the 
 safe investment of foreign and domestic capital 
 in new industries. 
 
50 CONFIDENCE 
 
 The wealth of England, France, Holland seeks 
 investment in foreign lands. Their territory is 
 fully improved and therefore their idle money 
 must find investment in undeveloped countries. 
 What opportunities the vast empire of the Great 
 Northern offered for the investment of foreign 
 funds in the United States! At once it wit- 
 nessed the building of great elevators and mills 
 at Minneapolis and St. Paul; the opening of 
 gold, silver, and copper mines; construction of 
 smelters, electric light and water plants; hun- 
 dreds of towns sprang up ; the cities of Spokane, 
 Seattle, and Tacoma were built. 
 
 These creations surely may be valued at from 
 six to ten billions of dollars. 
 
 Therefore we must acknowledge that through 
 Mr. Hill's construction of the Great Northern 
 Railway, the Northwest has received first; an in- 
 crease in land values amounting to six billion four 
 hundred thousand dollars; second, — larger an- 
 nual payrolls for all labor along Great Northern 
 territory, three hundred million dollars; third, — 
 investment opportunities in that region for six 
 billion dollars. 
 
 If we suppose that the total, two hundred and 
 ten million dollars of Great Northern stock is 
 
OR NATIONAL SUICIDE? 51 
 
 purely water, (which it assuredly is not), is it 
 a reward any too great for the venturous stock- 
 holders of the Hill railroad? 
 
 If the two hundred and ten million dollars of 
 Great Northern stock be all regarded as water, 
 (or increased value), its par value is less than 
 one-twenty-fifth of the increased values (or 
 water) of the territory served by the road. 
 
 Now, on what side of the fence is the water, — 
 on the inside or the outside? 
 
 Is it possible that any one can think for a mo- 
 ment that the Great Northern stockholders 
 benefited, comparably, with others who profited 
 by the opening up of this region? 
 
 Where is the justice in forcing a man like Hill 
 to beg for fair play from the American people? 
 
 I wish to ask the reader: — Are you perfectly 
 willing to face loss of business and money? If 
 so, then, perhaps, you may witness injustice to 
 the railroads with equanimity. 
 
 But, if you desire to have your own business 
 prosper; if you wish to see our land develop, dur- 
 ing your lifetime ; know and work to the end that 
 the railroads shall be allowed increased traffic 
 rates, — ^in keeping with advances along all other 
 lines of commercial enterprise and development 
 in the United States. 
 
52 CONFIDENCE 
 
 Then will other empire builders be encour- 
 aged to follow Hill's example, striving for the 
 upbuilding of our nation. 
 
 Let us not begrudge builders of American rail- 
 roads commensurate returns from their invest- 
 ments when, in ninety cases out of a hundred, 
 men like Hill, have made twenty-five times as 
 much money for people outside the right of way, 
 than has been made for the inside stockholders! 
 
AMERICAN WOLVES 
 
AMERICAN WOLVES 
 
 "C^VERY few years the commerce and pros- 
 perity of our country have been forced to 
 pay tribute to the bear leaders. 
 
 Pirates of the North African coast, in the 
 fifties, demanded from the United States a trib- 
 ute so small, as compared to the demands and ex- 
 actions of these bear raiders, that it makes the 
 African pirates of old, seem meek as Sunday 
 School teachers. In each bear attack, we see 
 some leading man mangled on the financial rack. 
 While the victim's fingers are not pulled out, as 
 was the method of the Spanish inquisition; and 
 while the torture chamber is not now in some dark 
 dungeon, but in beautifully equipped and fur- 
 nished offices, the torture is just as great. 
 
 A man may have fair financial standing. He 
 perhaps thinks he has the confidence and respect 
 of leading interests. He imagines he may escape 
 the cough-up-quick methods of the street. No 
 doubt he is a director of banks or trust compa- 
 nies. He has been requested to carry his account 
 in this or that bank or trust company; he has been 
 
 55 
 
56 CONFIDENCE 
 
 given iinlimited credit at the brokers ; but the day 
 comes when the bears, — or, in truth, 'wolves — 
 "need his money"; these wolves may have been 
 associated with him and he thinks they will play 
 fair. Like Russian wolves, financial raiders do 
 not discriminate while picking their victims. 
 
 The time comes for the victim to disgorge a 
 million or two because he believed in his wolf- 
 ish chums. These wolves have friends in many 
 banks and can find out just where his loans are, 
 nearly all being "on demand." In twenty-four 
 hours they size up what bear pressure he can 
 stand; they know his assets, almost to a cent. 
 
 The play begins. They sell short, three or four 
 thousand shares of his favorite stocks. The 
 banks call for more collateral and he complies. 
 Next, three or four thousand shares more are 
 dumped on the market and the man they are after 
 is the principal supporter of these stocks; he is 
 now on the run! Therefore, the market is not 
 protected in these stocks. Gossip is started that 
 Mr. Victim is in a tight place. This stops all 
 buying of his favorite stocks, since a greater 
 slump is feared because he is reported weak. Sud- 
 denly more shares are sold at a five point drop. 
 More collateral is demanded which he cannot now 
 
OR NATIONAL SUICIDE? 57 
 
 give, and this is known at once at the seat of war. 
 His bank loans are called; cash and collateral 
 gone, — excepting a package of ''cats and dogs" 
 that the bankers will not accept. One more raid 
 on prices; a little more bear talk and the victim, 
 recognizing the pursuers, disgorges to the wolf- 
 pack anywhere from a quarter to a half of his 
 life savings. Then the market rebounds and the 
 papers mention how the day was saved. The cur- 
 tain falls! 
 
 It was a put-up job from start to finish. If he 
 had been a big fish, a panic might have resulted 
 affecting all interests. Confidence is shaken! 
 Millions of dollars are lost ; our people are made 
 to suffer ; business is retarded ; and we are damned 
 in the eyes of the world. 
 
 Why is it that a man, on the slightest provoca- 
 tion, will whoop it up for the Stars and Stripes, 
 singing: — "My country, 'tis of thee," will fight 
 in the Spanish War, and allow his son to join the 
 Society for the Prevention of Cruelty to Ani- 
 mals; will contribute to the Ice Fund and other 
 charities; will do all in his power, (as he thinks) , 
 for humanity's sake; will weep great tears over 
 the Armenian massacres ; and then, forsaking all 
 good promptings, will perversely degenerate to 
 
58 CONFIDENCE 
 
 engineer a bear raid? Raiders are willing to at- 
 tack a great American, and ruin an enterprise 
 which probably represented years of suffering 
 and labor in the building. The money wolf may 
 jbring down in the wreck a bank or trust company 
 just for a little gold. And while doing this 
 wrecking, dares to think he is a patriot, and con- 
 siders himself a Christian or an orthodox Jew, 
 yet feels no more compunction when shooting 
 holes in the ten commandments than he experi- 
 ences while smashing clay pigeons. 
 
 What is the good of money secured in this way 
 and who can be sodden enough to want it? 
 
 A man once prominent in business and whose 
 name was daily in the papers, a few years ago 
 made the remark to me: — "I am out for the stuff 
 and I will get it some way — any way; people 
 know that is my game, but I am the smarter and 
 will win." 
 
 I have watched that man and it is true that he 
 has won money, but he has no friendly associates. 
 It is true that he has a brilliant mind, yet he has 
 not won a respected position in the business 
 world. He can secure all that money can buy; he 
 can weigh out his gold for lands, pictures, houses 
 and automobiles, but he cannot purchase desira- 
 
OR NATIONAL SUICIDE? 59 
 
 ble friends ; he cannot buy respectable standing in 
 the business world. If his flame were now con- 
 nected with any great business enterprise it would 
 damn it from the start. 
 
 I wonder if he realizes, as the shadows of the 
 great unknown sweep over him, that he cannot 
 push them back; that he will soon be swept into 
 the great hereafter, for which he cared so little in 
 the years gone by. When he is alone in the twi- 
 light of his earthly life, and sees the night ap- 
 proaching, wiU aU his milHons take the vile taste 
 from his mouth, when he thinks of the nasty tricks 
 which won the gold? Then, surely, he would 
 gladly give half of all his possessions in ex- 
 change for his sacrificed character and manhood. 
 
GRAEITIS" 
 
"GRABITIS" 
 
 /^NE of the greatest faults of the American 
 ^^ people may be termed, for want of a better 
 word, "Grabitis," meaning that trait of grabbing, 
 the "grab disease," which has of late had full 
 sway in the United States. 
 
 It is grab, grab all the time until death calls 
 the game. Suppose you do accumulate one hun- 
 dred and sixty milUon dollars, or sixteen million 
 dollars, or even six hxmdred thousand dollars. Is 
 this not enough to take the energy out of any 
 young man who inherits it? 
 
 While you were accimiulating this wealth in 
 what a mad rush you were living! What pleas- 
 ure did you get out of Jife? Your family and 
 children obtained only a cinemetographic view of 
 you; with yom* clubs, your meetings, your wife 
 had only a hazy idea that she had a husband, and 
 by keeping a photograph of you in each room, 
 retained a fairly accurate idea of your appear- 
 ance. 
 
 You acquired the C. & F. Railroad; then you 
 bought the majority of the stock of the L. F. 
 
 6S 
 
64 CONFIDENCE 
 
 & W. and froze out a minority of the stockhold- 
 ers, by passing the dividends and pretending that 
 you were upbuilding the road; at last you forced 
 them out, or nearly, for a small price. When your 
 squeeze was finished, you started dividends by a 
 well-arranged pool, pushed the stock up to near- 
 ly par, from about forty; this made for you per- 
 haps four million dollars, which was one-half fair 
 business deahngs, and half, plain highway rob- 
 bery. Perhaps it is not just to cast such a slur 
 on the highway robbers; they were brave men and 
 took their lives in their hands; you were a sneak 
 and sandbagged the minority in a way they could 
 not resent. But this four million dollars enabled 
 you to buy a large interest in the P. M. & F. 
 Railroad; you are elected on the directorate; why 
 in thunder you wanted thiis, God only knows! but 
 the "Grabitis" possessed you and you grabbed. 
 By this time you were elected to boards of twenty 
 bank and trust companies, not for the benefit that 
 you conferred upon the stockholders, but because 
 you thought that, as a director, you could borrow 
 more with less chance of being "called" in case 
 you got into a hole. You soon were director in 
 such a lot of banks and trust companies that you 
 needed a secretary to tell you when the meetings 
 
OR NATIONAL SUICIDE? 65 
 
 occurred, and you nearly required roller skates 
 on which to glide around from one meeting to an- 
 other, in time to pocket the ten or twenty dollar 
 fees. By coming in late, you attracted attention 
 and it appeared to your fellow directors that you 
 were in demand, and that it was an honor for 
 them to be on the same boards with you. Every 
 time there was a money squeeze you were just 
 two points ahead of "a fit," since your assets 
 were spread out thin as molasses in fly time. 
 
 Doubtless you worked hard and now and then 
 had to take a cocktail and a few whiskeys to keep 
 up the pace, but you had "grabitis" and you 
 could not stop to rest ; you were a htmian steam- 
 roller, and hke adverse Fate, crushed those in 
 your path. Then came a year when things looked 
 blue; you took a house at Newport for the sea- 
 son, in order to bluff your banks, and you rushed 
 through the year, not once breaking a cog of the 
 wheel of yoiu" plans. 
 
 Next, stocks were depressed! You tried to 
 grab one more railroad, but someone with a 
 "grabitis" case eclipsing yom-s, got ahead of you; 
 it worried you; you felt the loss of prestige; you 
 slept poorly; took more whiskey and soda, etc. 
 Soon there came a day when a string in yotir 
 
66 CONFIDENCE 
 
 makeup snapped; you staid around the house and 
 sent word that you were feeling fine, but would 
 take a month or two of rest; in a week or so all 
 the strings were snapping and it was all over. 
 
 In twenty years not a person on earth except- 
 ing son or daughter will ever know that you ex- 
 isted; they will now and then point to your 
 picture and say "That was father — he was a won- 
 der in his day!" 
 
 Is it worth it? You were merely a human cash 
 register; just a machine in which to drop dollars 
 to be added up correctly. 
 
ARE YOU A LION OR A ZEBRA? 
 
ARE YOU A LION OR A ZEBRA? 
 
 TJECENTLY, while reading Ex-President 
 Roosevelt's vivid description of an African 
 plain, alive with wild animals, — zebras, giraffes, 
 wild cats, and lions, — ^to me it seemed a picture 
 of himian life. Side by side were animals which 
 hve only by devouring each other (hke the lion, 
 the panther, and the wild cat) , while near-by, the 
 zebra grazed, and the stately giraffe ate young 
 foliage, and I could not but think this picture 
 represented men of the financial world. 
 
 In this country there are men who are creating, 
 building up, making two blades of grass grow 
 where before was only one; using only clean 
 methods, seeing visions of the blessings their 
 work will confer on man, and content with the 
 thought that if they reap no financial benefit, 
 there is a reward which comes alone from pure 
 living; and an appreciation that money is not the 
 greatest thing in the world. These men may be 
 likened to zebras and giraffes, — living on grass 
 and leaves, and harming none. Again there are 
 men who may be likened unto carnivorous ani- 
 
 69 
 
70 CONFIDENCE 
 
 mals, hungrily waiting to find a man weak 
 enough for them to fall upon and devour. Such 
 men live only that they may destroy the weak, 
 and they call it "business," and use phrases such 
 as "we will twist his tail," "we have him on the 
 run," and "we will freeze him out in less than a 
 year." Tricks, deceits, slander, are their favorite 
 weapons, and how they remind one of the panther, 
 silently stalking prey, surprising and destroying 
 his victim! 
 
 I am reminded of a man who came into my 
 office, with a scheme to force to the wall two 
 electric light plants of a small town. He began 
 by asking if I wanted to be let in on a good deal. 
 I said:— "Go ahead!" 
 
 It seemed that a certain western man owned 
 one of these electric plants, but the company had 
 never been a financial success. A rival had cut 
 prices ; competition was too great ! He was "ex- 
 tended," and had loans at two local banks, only 
 keeping up the interest. The bankers respected 
 the man, for he was one of the leading men, who 
 for years had fought against adverse circum- 
 stances, and would not "force him to the wall." 
 They were willing to sell his paper to others, for 
 banks had been warned by the Comptroller to get 
 
OR NATIONAL SUICIDE? 71 
 
 rid of it as soon as possible. My visitor knew the 
 total of the debts, and what it would cost to buy 
 them. The rival plant was owned by nearly a 
 hundred bond and share holders, "half of them 
 women," he said, "who did not know anything 
 about business !" The plant in question had more 
 modern machinery, and cost less than the other, 
 he continued, but at the rates prevaihng, could 
 pay only the interest and not keep up the plant. 
 My visitor's scheme was to buy from the bank 
 the paper of this man who owned the first plant; 
 sell him out; get a judgment; and then, he said, 
 this would give us the plant, and a judgment for 
 $100,000. The man would have to sacrifice his 
 home, which would make him a pauper! Then, 
 with this acquired, we could reduce electric light 
 rates one-half, and figure on intentionally drop- 
 ping twenty-five thousand dollars during the 
 year. This would mean, he said, "quick death to 
 the other plant"; it would "force them to the 
 wall," and we could buy them out at foreclosure 
 sale for half, since, he said, "the old women 
 would not know how to protect themselves!" 
 We might then consolidate the two plants; he 
 could push a franchise through the Council for 
 fifteen thousand dollars; then we could put up the 
 
72 CONFIDENCE 
 
 rates and make five hundred thousand dollars by 
 this fine deal. 
 
 I listened to his scheme of highway robbery, 
 and as he mentioned the possible profit, I could 
 imagine the saliva foaming at his mouth; like a 
 caged lion viewing the keeper offering a chunk 
 of meat dripping with red blood! 
 
 If there is anything in the Asian creed of re- 
 incarnation it would seem my visitor, centuries 
 past, must have been a pirate at "the top of his 
 trade," and I fancied him then, red-shirted and 
 with knife in teeth, climbing over the poop deck 
 of some brig he hoped to scuttle. 
 
 After my tempter finished his offering, I said; 
 "Where does the man live, whom we are to put 
 out of the way?" He answered: — "In a fine 
 house on one of the leading avenues." I asked: — 
 "Is the street well-lighted and policed?" He did 
 not know, and looked puzzled. 
 
 I enquired: — "Is this man all that we have 
 standing in our way?" 
 
 He repKed:— "Yes!" 
 
 Then I said : — "I hate to torture him, and take 
 his all. It will be better to kill him, and put him 
 out of his misery. If consulted he would prefer 
 this, for I'm sure his has been a hard struggle. 
 
OR NATIONAL SUICIDE? 73 
 
 What's the matter with our breaking into his 
 house, and smashing him over the head with a 
 sandbag? It will be quicker, and he will not 
 suffer so much, as by your plan." 
 
 I never will forget the expression on his face 
 as he rushed out, not understanding why I was 
 such a lunatic as to tiu^n down his offer, but it did 
 not appeal to me. I was a zebra, and lived on 
 grass. 
 
OUR FINANCIAL APACHES 
 
OUR FINANCIAL APACHES 
 
 'T^HE following articles from French journals 
 -"■ show the feehng in that republic, (which 
 saves and invests more millions than any nation 
 of its size,) regarding American financial 
 methods. 
 
 "Les Temps," leading journal of France, says: 
 "What would be the effect if our markets were 
 officially open to leading American securities? 
 What would have been the resvilt to French in- 
 vestors if the effort to introduce Steel Common 
 on the Paris Bourse had succeeded? In one year 
 this secm-ity has dropped from ninety-five to 
 sixty-two. The less that we have to do with 
 American fimance, as far as speculative securities 
 are concerned, the greater will be our chance for 
 escaping its fatal influence. We are not strong- 
 enough to meet such unscrupulous gamblers, 
 whose ideas of business morality are totally dif- 
 ferent from ours, and who regard the pursuit of 
 other people's money as the noblest existing 
 sport." 
 
 "Le Journal des Debats," Paris, a very con- 
 
 77 
 
78 CONFIDENCE 
 
 servative paper, says: "People are asking them- 
 selves whether Americans are not displaying 
 foolishness, as usual, in continuing their financial 
 machinations, — in their fondness for strangling 
 competition, — ^which is likely to furnish weapons 
 against the trusts. It must also be admitted that 
 the spectacle of their combats, in which the un- 
 fortunate shareholders receive the worst blows 
 struck by the belligerents, is not calculated to 
 favor the admission of American securities on the 
 markets of Europe." 
 
 You may read in other French papers that our 
 brilliant lights in the financial world really are 
 "Apaches," 
 
 The appearance of such articles in leading for- 
 eign papers does not tend to make the placing of 
 American bonds and shares an easy matter, and 
 sales of one hundred and thirty million dollars 
 of our bonds were cancelled in France, I under- 
 stand, during last June and July. If an ad- 
 vance in railroad rates were allowed, and no 
 injunction granted, these proposed sales would 
 have been made. The granting of the injunc- 
 tion not only worked to prevent these sales, but 
 was used in that masterly way which Wall Street 
 understands, — ^that the slightest suspicion regard- 
 
OR NATIONAL SUICIDE? 79 
 
 ing the future trend of the market should force 
 the selling of stocks. 
 
 Wall Street knows well that the rapid falhng 
 of values weakens bonds and shares all over the 
 United States. The pubUc thinks something 
 panicky is going to happen; it knows not what, 
 so shares are immediately dumped on the market. 
 
 Those who engineer bear raids fully under- 
 stand the solid worth of United States Steel; they 
 understand that it, if any stock, is worth par; 
 that it has earned on the common stock eight per 
 cent, per annum, since incorporation. Wall 
 Street did all in its power to publish these im- 
 portant facts when the stock was distributed at 
 high prices. Now, it wants it back, and the 
 poor investor, who was ten years screwing up his 
 courage to buy it, now drops Steel, pocketing a 
 loss, and goes back to the wood pile to saw more 
 wood. 
 
 He had the money to invest, and advisedly 
 bought Steel stock, but the rapid fall in quota- 
 tions took his breath away; he could not stand 
 seeing his money melt, and sacrificed it. His 
 stock was a safe and soimd investment, in a strong 
 company with splendid management, and most 
 promising future. I consider the creation of the 
 
80 CONFIDENCE 
 
 United States Steel Corporation as the master- 
 piece of J. P. Morgan's life. Its reserves of coal 
 and ore alone will make its stock some day worth 
 two hundred dollars per share; and its foresight 
 in building the new plant at Gary, Indiana, 
 makes it an ideal investment. 
 
 Its future is bright as that of the United 
 States. But its value must be made to fall from 
 ninety-five to sixty-four, not from any weakness 
 of the company, not from lack of promise. 
 
 A score of raiders, understanding human na- 
 ture, its fears and moods, play with investors, 
 and at will make the financial refrain one of sor- 
 row or joy. The market falls or rises at their 
 will, and no organist more completely masters his 
 instrument, than does this lot of raiders, working 
 all stops of the organ of speculation. Their 
 power to exact the pound of flesh, would make a 
 pawnbroker green with envy, and induce Captain 
 Kidd to turn over in his grave, — wishing that he 
 was now on earth, to join the piratical crew. 
 
 French journals dub such raiders "Apaches"! 
 Since we have captured the Apache Indians of 
 Arizona, and removed them to a Florida reserva- 
 tion, why not capture the Apaches of New York, 
 and put them also in hmbo? Western Apaches 
 
OR NATIONAL SUICIDE? 81 
 
 in sixty days never destroyed values of hundreds 
 of millions ; they burned a few farm houses occa- 
 sionally; yet our government pursued and wiped 
 them out. 
 
 When abroad, it makes one's blood boil to hear 
 his countrymen so characterized; for you know 
 that business morals of average members of the 
 New York Stock Exchange will compare favor- 
 ably with those of the members of any exchange 
 in the world. 
 
 It disgusts you to see your countrymen severely 
 criticised, — ^knowing that a handful of skillful 
 and unscrupulous raiders create this national dis- 
 repute. It was an awful mistake that raiders 
 were freely furnished with weapons for their at- 
 tacks on values and credits. Their weapons were 
 shaped from the fact that railroads were not al- 
 lowed advanced rates permitting them to share 
 in general prosperity, experienced by all other 
 lines of American trade and commerce. 
 
STATE CONTRACTS 
 
STATE CONTRACTS 
 
 TT is a fact which few business men or labor 
 ■*■ leaders understand, that there can be no pros- 
 perity in the United States, if the railroads are 
 not successful. Liberal traffic rates will make the 
 nation prosper. The railroad is the mainspring 
 of the nation's business. Hundreds of thousands 
 of railroad employees distribute thousands of 
 millions of dollars to merchants and manufac- 
 turers, — annually. 
 
 Contrary to public opinion, when traffic rates 
 are reduced and railroads starved, the people can- 
 not prosper and all industries languish. 
 
 You may not have a bond or a share in any 
 railroad ; you may never know any one who ever 
 owned a bond or a share ; you may live in a small 
 town where no one ever invested in railroad bonds 
 or shares ; you may applaud when some politician 
 vociferates that he will force railroads to reduce 
 rates, and you think that this politician is a 
 friend of the people. 
 
 Let me illustrate how remote conditions affect 
 us \ In 1903 a yoimg man seeking a bookkeeper's 
 
86 CONFIDENCE 
 
 position came into my office. I rather liked his 
 looks, and asked him how he had lost his last 
 place, recalling that he had been bookkeeper for 
 a Topeka Water Company. He said: "By rea- 
 son of the great crop failure of 1900 in Argen- 
 tine." I replied: "How in Heaven's name could 
 the crop failure in Argentine force you out of a 
 position in Topeka?" The answer was: "The 
 Barings were large stockholders in the Topeka 
 Water Company; the crop failure in the Argen- 
 tine caused the Barings to fail, and the Superin- 
 tendent of the Water Works thought it would 
 please the owners if expenses were reduced, so 
 he let out five of the employees." This will serve 
 to illustrate how remote causes affect people at 
 long range. 
 
 Now we will see that starvation of the railroads 
 affects merchants in far distant towns. 
 
 First, there is no way in which any three im- 
 portant railroads in the United States may be 
 forced into receiver's hands, without bringing 
 panic. Even the suggestion of such a possibility 
 has created great fear all over the country. 
 
 Start fear in the minds of men, and all busi- 
 ness is restricted; the New York banks call in 
 their loans; then the Chicago banks do likewise. 
 
OR NATIONAL SUICIDE? 87 
 
 This fear widens until it reaches the far town, in 
 which lives a man who "damns" the railroads. He 
 goes to the bank for a loan, or he is a stockholder 
 in the bank, and cannot sell the stock, for a few 
 banks have just failed, and no one wants stock in 
 banks during panicky times. He is, perhaps, in 
 pressing need of money, and cannot raise it, for 
 confidence in the railroads has been destroyed; 
 his banker is full of fear, and refuses to make any 
 more loans; in fact, all the United States is filled 
 with fear, and business is restricted. 
 
 Stagnation for invested capital spells stagna- 
 tion for all business. The value of bonds and 
 shares has depreciated, millions upon millions. 
 Every business man feels the squeeze; manufac- 
 turers shorten the hours of labor. 
 
 Some person in power, thinking that he is com- 
 plying with the wishes of the people (and per- 
 haps the wish of the President of the United 
 States), suggests restraining action which will 
 reduce railroad revenues; the bear raiders imme- 
 diately exaggerate the idea to suit their harmful 
 purpose; and all the wheels of progress begin to 
 slow down. 
 
 Everyone in the United States feels the evil 
 effects. Yet, at the very same time many people 
 
88 CONFIDENCE 
 
 and journals are applauding a political idea or 
 bill which means death to business for the next 
 twelve months. 
 
 This will some day be understood, and then no 
 politician will dare to attempt to interfere with 
 American railroads, — the life of American busi- 
 ness and prosperity! 
 
 While considering this subject, I wish to com- 
 mend the safety of railroad investments in Mex- 
 ico, and the different methods there employed to 
 safeguard them. If you make up your mind to 
 build a railroad in Mexico, you go to the Govern- 
 ment, and it gives you a concession for ninety- 
 nine years. In that concession, the Government 
 states the maximum rates which you may charge 
 for freight and passenger business for ninety- 
 nine years. You understand at once what charges 
 are possible, and you figure out whether it is 
 enough to warrant building your road. You 
 know that the Mexican Government will not 
 hereafter interfere with these stable traffic rates. 
 
 The effect of a railroad commission, acting as 
 operators of a railroad, forcing high officials to 
 do office-boy's work, is not fair or helpful. 
 Doubtless, the Railroad Commissioner has no 
 money invested in the Railroad construction or 
 
OR NATIONAL SUICIDE? 89 
 
 operation. Perhaps no resident in the State has 
 such interest. 
 
 The State does not guarantee that the traffic 
 rates made by the Commissioners will even pay- 
 one per cent, on the railroad investment. 
 
 But, if the State woidd grant a railroad a fixed 
 maximum traffic rate, to be in effect for thirty 
 years, then the Commissioner and the State 
 would be acting fairly and justly. The railroad 
 could then make contracts and hve up to them. 
 
 It is eminently xinfair that railroad officials 
 shall be forced to turn over the conduct of their 
 business to men, or commissioners, or States, 
 which, while making traffic rates, assume no re- 
 sponsibility for securing just returns, or fair in- 
 terest on money invested. 
 
 Suppose that jewelry shops were directed and 
 run by a Railroad or similar Commission. Tif- 
 fany builds and stocks a great store, and when its 
 doors are open for trade, he is compelled to turn 
 it over to a State Railroad Commission. He is 
 allowed a desk in his store, and the Commission 
 proceeds to fix prices on watches and rings. 
 
 But the Commission was put in power by the 
 people, and must serve the dear people. Poor 
 Tiffany has nothing to say. The Commission 
 
90 CONFIDENCE 
 
 names the hour for opening and closing the store 
 — ^which must close on Saturday. But the em- 
 ployees' wages are paid with Tiffany's money! 
 
 The Commission marks thirty-dollar watches 
 down to twenty, because the voters who elected 
 the Commission need cheap watches, — at less 
 than cost; but never mind, it's Tiffany's money, 
 and he must profit by other sales. 
 
 So long as railroads are forced to transport 
 hve stock at less than cost, it is just as fair that 
 the watches be sold at less than cost! The Com- 
 mission so argues, because it is given power to 
 act, not by Tiffany, but by the people, and the 
 sacred trust must be executed as the people wish. 
 Quite right is the Commission to exercise its 
 authority! 
 
 I suggest that if States gave to new railroads 
 thirty-year traffic contracts (as does Mexico), 
 setting forth exactly what traffic charges may be 
 made, capital would know what could be relied 
 upon as to earnings on each classification of 
 freight and passenger service. 
 
 No other business could stand the changeable 
 conditions now imposed upon railroads. 
 
 If a state allows its cities authority to grant 
 thirty-year franchises to street cars, with fixed 
 
OR NATIONAL SUICIDE? 91 
 
 rates (these are also accorded to electric light and 
 power plants), why is it not considered fair that 
 railways may also contract for fixed rates, before 
 beginning their construction in a State? 
 
 If capital woiald refuse to build more railroads 
 until fixed rates are established by law, following 
 the examples set by gas and electric companies, 
 and street car lines, the various states would soon 
 meet the required conditions. 
 
 I have built a great many miles of railroad in 
 the eastern part of Texas. I built the Kansas 
 City Southern; I founded one of its sea-ports, 
 Port Arthur. I built the Port Arthur ship canal, 
 and am interested now in building the Kansas 
 City, Mexico and Orient railroad in the western 
 part of Texas, together with large irrigation 
 works. 
 
 So it can be said that I am a friend of Texas. 
 And why not? It is an empire in itself, and no 
 one can foretell its future. 
 
 Texas leads every state in our Union as to 
 value of agricultural products. It needs rail- 
 roads. 
 
 Capital does not now think Texas friendly to 
 railroads, and the feeling may not easily be over- 
 come. It would be well for Texas to adopt the 
 
92 CONFIDENCE 
 
 Mexican plan, and make contracts with the rail- 
 roads, with fixed rates; not, as does Mexico, for 
 ninety-nine years, but, perhaps, for thirty years. 
 Should the State make fair terms, Texas would 
 experience a boom in railroad building which 
 would there advance the hands of time for ten 
 years, create new cities, and bring in millions and 
 milhons of added wealth. The statesman who 
 should inaugurate this policy would become in the 
 minds of the residents, more helpful than any 
 man who ever hved in the Lone Star land. 
 
 Of tremendous aid in developing Texas was 
 the building by B. F. Yoakimi of the St. Louis, 
 Brownsville and Mexican Railway, opening the 
 Southern Gulf Coast region, and bringing mil- 
 lions of dollars within her borders. 
 
 If Texas would grant existing railroads better 
 rates, this would bring great good to the State. 
 I know that Texas traffic rates are too low, and a 
 shght advance would attract millions to Texas, 
 and secure the building of new railroads. 
 
 As these observations are made, the Dallas 
 "News" comes to me, and contains an extract 
 from a speech by the Honorable Oscar B. Col- 
 quitt, Democratic nominee for the Governorship 
 of Texas. 
 
OR NATIONAL SUICIDE? 93 
 
 : 'u 
 
 This conveys hope that Texas is awakening to 
 beckoning Opportunity. I long to see Texas, — 
 largest state and richest as to wealth of varied 
 natural resources, — win the possible rank of first 
 American commonwealth as to population, since 
 she now stands first in om* Union as to agricul- 
 tural production. 
 
 Texas has but to give fairer rates to existing 
 and new railroads to become the ranking state as 
 to population, and political power and wealth. 
 Long have I labored to upbuild Texas, and I 
 fully appreciate her needs and wonderful 
 resources. 
 
 Mr. Colquitt gives me great hope. All the 
 country should hear his recent utterances: "My 
 message to the legislatm-e will recommend no 
 statute that will frighten any capital, or jeopard- 
 ize investment of honest money 1 Let us have 
 no more radicalism, because Texas has enough to 
 rest on for a season!" 
 
 Indeed, these are tidings of joy! 
 
 Most people understand that you cannot put 
 an eight-inch stream of water through a two-inch 
 pipe. It is estimated that the United States has 
 grown fifteen million in population during the 
 last ten years, and in the next ten years the 
 
94 CONFIDENCE 
 
 growth will no doubt be twenty million, about 
 twenty-five per cent, increase, in a decade. 
 
 Under existing conditions, there is no way in 
 which money can be found for railroad develop- 
 ment in order to keep step with this increase. 
 Yet, railroad building must keep pace with the 
 growth of population, or we will be attempting to 
 put an eight-inch stream through a two-inch pipe. 
 Some day, an awakening to the sense of lost op- 
 portunities will be rude and severe I 
 
 The last nine years of financial unrest in the 
 railroad world; the depressions of 1903, 1907 and 
 1908; advanced costs of material and labor; — 
 have so combined to threaten the railroad builder, 
 that he has rested on anything but a bed of roses. 
 
THE CORPORATION COURT 
 
THE CORPORATION COURT 
 
 'T^HANKS to President Taft we now have a 
 Commerce Court, which will aid railroads 
 by securing early hearings. 
 
 I believe that the establishment of another most 
 useful tribunal, a Corporation Court, would be 
 generally welcomed. 
 
 Oxu" nation is now nearly paralyzed, while 
 awaiting the Supreme Court's decision in the 
 Standard Oil and American Tobacco Company 
 cases, and until these judgments are handed 
 down there will be no great prosperity. 
 
 Of late, we have been told, — and it has ap- 
 peared in the English journals, — that legal steps 
 will be taken against the United States Steel Cor- 
 poration for being a monopohstic trust. 
 
 Like reports are heard abroad and appear in 
 foreign journals every time there is an American 
 bear raid. Investors have felt "jumpy" of late, 
 frightened by stories of legal procedures and 
 panics, and these have sorely aflPected values. 
 
 The United States Steel Corporation is one of 
 the best organized companies in the world. It 
 
 97 
 
98 CONFIDENCE 
 
 has great assets, but it is not a monopoly and does 
 not intend to become such. I believe that the 
 desire of its directors is fully to comply with the 
 law. 
 
 I believe there is no truth in these published 
 reports. But there seems to be no way in which 
 they may be conclusively denied. The Steel Com- 
 pany cannot well do this, and the Government 
 has not manifested any intention of so doing. 
 
 I believe the Standard Oil Company, and the 
 American Tobacco Company, if they reaUy un- 
 derstood the law, (which nobody seems to do), 
 would at once shape their course to comply with 
 its every letter. 
 
 It is not the purport of these remarks to discuss 
 what above companies' attempts and acts have 
 been, in the past, but I fully beheve that they now 
 desire strictly to abide by the law. 
 
 A general state of uncertainty, during the next 
 few months, will cost the United States untold 
 millions by retarding progress and restricting our 
 own and foreign investments. 
 
 If, however, we had a Corporation Court com- 
 posed of six eminent attorneys, before which any 
 company could, in advance, state its business 
 plans for the court's approval; the court's legal 
 
OR NATIONAL SUICIDE? 99 
 
 endorsement, in advance, approving the com- 
 pany's policy, would render it easily possible to 
 place securities and would end harmful prevailing 
 rumors. 
 
 I recall that, during the recent panic, in order 
 to save certain financial institutions, it was neces- 
 sary that the Tennessee Coal, Iron and Railroad 
 Company should be sold. It is understood that 
 the United States Steel Corporation would not 
 buy the road until President Roosevelt sanc- 
 tioned its sale. 
 
 In a similar, urgent case, immediate decision 
 rendered by a Corporation Court would be use- 
 ful. It would estabhsh confidence in our securi- 
 ties. 
 
 We all know that English manufacturers of 
 silverware have their goods hall-marked by the 
 English Government. That httle mark is ac- 
 cepted all over the world guaranteeing the fine- 
 ness of the silver. 
 
 The suggested Corporation Court would hall- 
 mark our securities and prove an additional aid 
 in securing and establishing national confidence. 
 
FIXED TRAFFIC RATES FOR 
 FIFTEEN YEARS 
 
FIXED TRAFFIC RATES FOR FIF- 
 TEEN YEARS 
 
 A FTER health, service is the greaflpst^lessing 
 that can be conferred oft the vJ^VWoi our 
 
 nation; that is regular work:, "^ ♦UP^ood^pay for 
 all ; work well done, day after ( By, ijjixh a chance 
 for the laboring man to edjift^te hi;? children, own 
 his home and save moiM^rEvenly balanced con- 
 ditions in business mil alone bring opportunity 
 for labor; falling prices of securities and financial 
 unrest never wiU secure these great blessings to 
 this nation. In order to gain needed years of rest, 
 we must end the present period of "jumpy" con- 
 ditions, and give our bankers, for a few years, 
 opportunity to drop that scared-dog look which 
 they have worn of late. This change would prove 
 to be the greatest blessing possible to happen in 
 the United States; so great, that it is advisable 
 our President, Congress, Governors and Legisla- 
 tures of every state, should work to solve the 
 problem during the coming year. 
 
 Now to my mind the solution can alone be 
 brought about by the granting of a slight in- 
 
 103 
 
104 CONFIDENCE 
 
 crease in freight and passenger rates. After 
 these are fixed, so that the net railroad earnings 
 are one per cent, more than at present, let the 
 rates alone for fifteen years ! 
 
 Make no changes for fifteen years and assure 
 railroad men and bond and share holders that 
 they need fear no radical rate changes. The very 
 day that traffic rates are fixedly established, (hke 
 the price of postage stamps) for fifteen years, we 
 would inaugurate a period of the greatest pros- 
 perity our nation has witnessed. 
 
 The purses of England and France would 
 open in this direction. Capital would be invested 
 in American land as never before. Most manu- 
 facturers would be pushed night and day to fill 
 orders, and new industries would start. United 
 States Steel would go to par and remain there. 
 All labor would have permanent place at good 
 pay. We would be free from panics for the next 
 fifteen years, or, xmtil enforcement of another ad- 
 justment of traffic rates ; but I think by that time 
 Capital and Labor would be so pleased with the 
 working of tihe fixed rate system that its fifteen- 
 year period would be extended. 
 
 Presume the passenger rate were advanced one 
 mill per mile ; this amounts to but one dollar more 
 
OR NATIONAL SUICIDE? 105 
 
 on a ticket from New York to Chicago. Suppose 
 freight rates were on an average, advanced one- 
 half a mill per ton, per mile; that would be only 
 fifty cents advance from New York to Chicago. 
 Then imagine, (and you cannot unless you are a 
 railroad man,) that this rate is fixedly established 
 for the next fifteen years. Tremendous work 
 would be immediately planned. What improve- 
 ments now would be laid out for 1911-1912 and 
 1920, positive that during that period there would 
 be no fight for railroad existence! 
 
 Under the present changeable status, railroads 
 plan for an expenditure of ten or twenty mil- 
 hons; suddenly some great change is eflFected in 
 trafiic rates, or railroads are enjoined from ad- 
 vancing these, and simultaneously are compelled 
 to advance pay for all labor; — ^all the contem- 
 plated improvements stop! 
 
 During the last four months, fully one hundred 
 million dollars of planned improvements for rail- 
 roads have been abandoned, I have been told, and 
 sale of railroad securities has been made impossi- 
 ble because of rate meddhng. 
 
 At least fifty million dollars of this sum would 
 have gone into the pockets of laboring men. What 
 a loss to labor! Capital can stand holding the 
 
106 CONFIDENCE 
 
 money idle even if it earns no interest for a while ; 
 the money remains in possession of ;the capitalist; 
 it is lost by the laboring man. 
 
 Traffic-rate regulation acts of the last sixty 
 days, are apt again to establish the bread line and 
 free soup as national institutions, and unless re- 
 action quickly occurs this cannot be prevented. 
 
 To use a vulgarism, our nation seems to have 
 been "hitting the pipe," and mistakenly enjoying 
 hallucinations. The national ear has been close to 
 the ground, listening to the people "damning the 
 railroads"; apparently the sweetest music was 
 the singing of politicians asseverating they were 
 "going for the railroads" ; most delectable reading 
 was muck-raking articles lambasting invested 
 capital. Certainly this is "hitting the pipe"; it is 
 deadening progress with opium and as helpful as 
 was Nero's fiddling while Rome burned. 
 
 Prices of land, corn, hogs, cattle, help, rent, 
 living and clothes have gone up with bounds dur- 
 ing the last decade, yet railroad rates have been 
 pushed down and all railroad running expenses 
 have increased exactly in proportion to the living 
 expenses of man. Not long since, it was thought 
 that we would have a panic every nine years ; now 
 it seems we must welcome them every twenty- 
 four months. 
 
OR NATIONAL SUICmE? 107 
 
 The chief reason for this is, that the raiboads 
 are not fairly treated; they are forced to pay 
 more for material and help than formerly, but 
 are not allowed to increase traffic rates. But even 
 if thus denied, conditions would not be so bad, 
 if rates were definitely fixed for a period of years ; 
 if politicians and law makers would let the rates 
 alone; stopping this endless agitation which leads 
 investors to think that drastic steps are to be 
 taken, which certainly would put out of business 
 some of the roads that are now fighting for bare 
 existence. 
 
 This country is growing fast and nothing helps 
 its growth like proper transportation facilities. 
 James J. HiU says that five himdred million 
 dollars needs to be expended by American rail- 
 roads in the next ten years. I believe it. If some 
 law could be passed calculated to overcome the 
 distrust regarding our securities, this money 
 could be found here and in Europe. It wiU not 
 remain uninvested, but failing us will go to up- 
 build Argentine, Chili, Brazil, Africa or Russia. 
 We could secure this gold if a slight advance in 
 traffic rates were allowed and assurance given of 
 "hands off" for fifteen years. The Erie needs 
 thirty million dollars and could get it; the Santa 
 
108 CONFIDENCE 
 
 Fe could finish its double track, which plan, the 
 English papers said, was abandoned, when the 
 proposed raise in rates was enjoined. The Union 
 Pacific and other roads would expend millions. 
 
 Would you object to this slight increase in 
 freight rates, which amounts to one-sixteenth of 
 the present schedule? Would you feel the trifling 
 increase of one mill per mile in passenger rates? 
 I believe not! Your assent would secure pros- 
 perity, — the like of which has never been wit- 
 nessed! Our bonds and shares would take their 
 proper place at home and in the eyes of foreign 
 investors and we would permit railroad develop- 
 ment to keep pace with the rapid growth of the 
 nation. The great prosperity now enjoyed by 
 Canada would be secured for the United States 
 and CONFIDENCE would supplant NA- 
 TIONAL SUICIDE. 
 
AN AMERICAN LEGION OF HONOR 
 
AN AMERICAN LEGION OF HONOR 
 
 T HAVE always thought that the most needed 
 ■*■ order in the United States is a LEGION 
 OF HONOR. There are a numher of reasons 
 for this. We have men in all parts of our land 
 who are striving in every way to become public 
 benefactors. In the crush of business and the 
 rush for wealth, such men are scarcely noticed, 
 yet there is no man who does not love to have his 
 good works recognized, and it would be well for 
 any nation, pubUcly to recognize merit. 
 
 A number of Americans have been made mem- 
 bers of the French Legion of Honor, a decora- 
 tion in which they have justly taken pride. 
 
 In England, men enthusiastically prosecute all 
 kinds of work for the good of the nation, confi- 
 dent that in due time their efforts will be nation- 
 ally recognized. Great writers, actors, mer- 
 chants, builders, scientists, doctors, bankers, are 
 rewarded with the title, "Sir," or "Lord," or 
 achieve orders of merit for distinguished service, 
 — ^precious above gold, and a glory for their chil- 
 dren and their children's children. 
 
112 CONFIDENCE 
 
 Let us form a Legion of Honor to reward our 
 great men, in any walk of life, who give all in 
 their power to develop or' uplift the nation. It 
 is ignoble that mere millionaires should be 
 thought to constitute American nobility! 
 
 The nation should create a Legion of Merit, — 
 an aristocracy of distinguished national service! 
 We should no longer count millionaires as great; 
 some of these seem to have striven to prove the 
 old saying that large wealth cannot be earned 
 with kid gloves. More men would strive for a 
 good reputation were this considered as impor- 
 tant an honor as the possession of riches. 
 
 We may not now sail pirate craft with the 
 black flag nailed to the mast-head; we may no 
 longer organize Jesse James gangs; but we 
 have more modern methods of robbing, more 
 potent than either of the foregoing. Unfor- 
 tunately the chief American strife has been for 
 wealth. Is it not time that we should give a little 
 attention to other matters? What other nation 
 has ever produced a man who has achieved so 
 much for transportation as George Westing- 
 house? Yet, do we half appreciate what he gave 
 the world in the air-brake invention? We have 
 hundreds of men worthy to have written before 
 
OR NATIONAL SUICIDE? 113 
 
 their names: — "Honorable" and after their 
 names: — "D. N. S."— Distinguished National 
 Service. 
 
 Andrew Carnegie has been a great power 
 throughout the world. No man in the United 
 States has ever done more than James J. Hill to 
 enlist confidence of foreign investors in American 
 railroads. During twenty years of work in 
 Europe, I have never heard any man speak of 
 Mr. HiU except in praise, and there has been no 
 loss in any investment which he has placed. Mr. 
 Flagler has been of assured benefit in building 
 the Florida East Coast Railroads and his chain 
 of hotels. 
 
 An organization of men recognized as national 
 up-builders would be a powerful aid in counter- 
 acting some of the scandalous reports made dur- 
 ing the financial depression, and such an insti- 
 tution would be of great use in upholding and 
 sustaining national credit and honor, — Whelping to 
 establish confidence. 
 
 Its word would be potent in any of the markets 
 of the world. It would be helpful in shaping 
 public opinion when important legislation is being 
 considered. 
 
 I can see no reason why an American Legion 
 
114 CONFIDENCE 
 
 of Honor is not a needed national institution and 
 why the emblem would not be one sought after 
 and worn with pride when earned. 
 
 I am sure such an order could be incorporated 
 by a biU in Congress, giving the President the 
 right to name the first twenty-five members. We 
 could all rest assured that he would make a wise 
 selection. They, in turn, might have the power, 
 annually of conferring the title of "Distinguished 
 National Service," on perhaps twenty or thirty 
 additional members. 
 
 In time we would look with high respect on 
 such organization. I am quite aware of the fact 
 that a number of our leading men wiU occupy a 
 place in the Hall of Fame; yet there is very little 
 fattening in post mortem glory! 
 
LET US BE FAIRl 
 
LET US BE FAIR! 
 
 TNCREASED prosperity for the railroads, 
 largest employers of labor in America, and 
 increased traffic rates are exactly what every one 
 wants brought about. 
 
 This may be thought a rash statement, but 
 nevertheless is a fact. The reader may not ac- 
 knowledge that he wishes this consummation, so 
 in this concluding chapter I shall state my rea- 
 sons for the above expressed belief. 
 
 In the first place, everyone in the nation is 
 blest, when abundant prosperity exists along all 
 walks of life. 
 
 In 1892 or 1893, corn ranged from seven to ten 
 cents a bushel; this price brought no one any 
 good, — ^it starved the farmer, foreclosed a vast 
 number of mortgages, and brought general ruin 
 to merchants, since the farmer had no money to 
 spend. It restricted trade of all kinds, and all 
 building operations. 
 
 Let us exaggerate! Suppose the Interstate 
 Commerce Commission not only fixed the rail- 
 road rates, but also established the market price 
 of com! 
 
 117 
 
118 CONFIDENCE 
 
 If the Interstate Commerce Commission 
 should now cut the price of corn to seven cents a 
 bushel, no one would be benefited. Perhaps the 
 laboring man may think this would aid him, by- 
 reducing the cost of living; but if it restricts the 
 prosperity of the country, it reduces the price of 
 labor, and if the laborer need pay less for food, 
 still he receives less wages, and perhaps would 
 become one of thousands out of work. 
 
 Now, as to railroad rates: since railroads are 
 the hfe of the nation's progress why not grant 
 them abundant favors? The farmer enjoys 
 prosperity; with high prices for farm products, 
 and no one should begrudge the farmer; the mer- 
 chant and manufacturer delight in it, and no one 
 begrudges them! 
 
 Let me illustrate what a period of injustice we 
 are experiencing. 
 
 A manufacturer of limiber, of a western town, 
 was calling in New York on some old friends of 
 his boyhood days. He had gone west years be- 
 fore, bought a timber tract, and when a railroad 
 came near, began the manufacture of limiber. 
 
 The present price of lumber, we all know, is 
 about three times that of 1892, — ^the time of cheap 
 com. The manufacturer, boasting of his won- 
 
OR NATIONAL SUICIDE? 119 
 
 derful prosperity, said: "Year before last, I 
 netted four hundred thousand dollars; I did not 
 know what to do with the money, so I turned the 
 business over to my son and partner, and went to 
 Europe. I thought that without myself at the 
 concern's head, not much could be made the next 
 year. To my surprise, it was five hundred and 
 twenty thousand dollars net. I tell you, it's fine 
 to have money roll in that way; for ten years be- 
 fore, the best I could do was to make a Uving. By 
 the way, old man, as you are in the railroad busi- 
 ness, I just want to say that our Governor is a 
 'cracker- jack'; he is going for the railroads hard, 
 and just forcing them to reduce rates ! I lunched 
 with him the other day, and on leaving, said, slap- 
 ping him on the back: 'Go for them, Governor, 
 hit 'em hard: you're a brick!' " 
 
 Now, this story is not overdrawn. 
 
 Consider the unreasonableness of that man, re- 
 counting the great prosperity he was enjoying; 
 yet the railroad, — an instrument made with other 
 people's money, and which enabled him to become 
 a rich man, — ^must be sacrificed. He is unwiUing 
 that stockholders of this railroad, his ladder to 
 success, shall share in the general prosperity. 
 
120 CONFIDENCE 
 
 That a man should so reason makes one think 
 higher of his dog's instinct! 
 
 Let's be fair! Let us be American ! From now 
 on, let us fight for abundant prosperity for the 
 railroads, just so long as we desire prosperity in 
 our individual affairs and for the nation! 
 
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