HD ,^5 The Grain Trust W32. Exposed TOM WORRALL BY TOM WORRALL Cornell University Library HD 2769.G7W92 The grain trust exposed. 3 1924 013 937 457 The Grain Trust Exposed BY TOM WORRALL PRESS Olr JACOB NOKTH & fO., LINCOLN 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/cu31924013937457 PREFACEJ To the Reader : Just where and when I was born, and what was the name of the attending physician and nurse are mattei'S of little in- terest to you. You are not concerned as to whether that important event occurred in a sod house, a log house or a palatial mansion. You don't care whether I can trace my ancestry back to the Pilgrim Fathers and the Mayflower or not. Perhaps I could if I tried. I never tried." For I don't care, either. '\^'hat you are interested in is the story I have to tell. It is for that you are paying your money. Before you pay it you may want to know what the story is, why I have written it, and why I am competent to write it. That is what I pur- pose telling you right here, and in the fewest words possible. My story is of a band of broadclothed "respectables" who have grown rich at the expense of the farmers. Unlike the James gang this band has not ridden the prairies armed with Winchesters, taking tlieir lives in hand, to commit crimes in bold and OTpen violation of the law. Methods now are more modern. A plan has been evolved for obtaining the maxi- mum of loot with the minimum of risk. I am to tell the story of the Nebraska grain trust The members of this trust perfected and successfully operated a stupendous scheme for pillaging the farmers. In a word, the scheme was to compel the farmer to sell his grain at a price fixed by the trust or see it rot on his hands. They did this by agreeing not to compete with one another, and to drive out of the field, at whatever expense, any outsider who might attempt to go into the grain business to compete with them. How they accomplished this, to what high-handed and ex- traordinary methods they resorted, is my thema How is it that I am competent to speak? b PEEFAOB I was one of them. For several years I belonged to the band. 1 was "on the inside," had a voice in the concocting of the schemes, and an active hand in their execution. How came I there? In the beginning, I embarked in the grain business as an independent dealer. The trust marked me for slaughter. I fought it for months. It had thousands of dollars to my pennies. At last I was forced into a position where I must accept utter ruin as my lot, and start life anew a penniless man, or join the band. I joined. It was no honorary or associate membership, either. When I came in, it was as an active member. When my interests were with the trust I worked as diligently for it as t had previously worked against it. Without boasting, I can truthfully say I rose to prominence in its councils. ' Why do I ^Tfite this book? When I grew weary and ashamed, of my connection with the trust, and quit it, and again attempted to do business in the open, my former associates, unwilling to peirmit me to repent and reform, again swooped down upon me, and again were on the point of driving me out of business. This time, instead of capitulating, or allowing myself to be ruined, I went into the courts and invoked the strong arm of the law to save my business. In this book I go before the farmers to tell them the truth, the whole truth, and nothing but the trutfi, and, having made clear to them how they have been tictimized, to ask them to join with me in restoring the grain business in Nebraska to an honest and competitive basis. TOM WORRALL. Omaha, Nebraska, September 4, 1905. CONTENTS CHAPTER I WORSTED BX THI2 TRUST CHAPTER II SOME EARLY HISTORY CHAPTER III CLOSING UP THE RANKS CHAPTER IV THROTTLING COMPETITION CHAPTER V THE TRUST GROWS STRONGER CHAPTER VI BIRTH OF THE PRICE COMMITTEE CHAPTER VII HANDLING A LEGISLATURE CHAPTER VIII BXIT BEWSHER^ ENTER MILLER CHAPTER IX FOOLING THE FARMERS CHAPTER X THE FIRST CLOUD APPEARS CHAPTER XI WORRIED BY THE OMAHA GRAIN EXCHANGE CHAPTER XII QUARRELS AND RECONCILIATIONS CHAPTER XIII A FREE MAN ONCE MORE 8 CONTENTS CHAPTER XIV HAMMERED BY THE TRUST CHAPTER XV BOYCOTTING FARMERf' SHIPMENTS CHAPTER XVI APPEAL TO THE COURTS CHAPTER XVII A LAST WORD WITH THE READER APPENDIX BEFUSING TO TESTIFY ILLUBXRATIONS NORUIS BEOWN Attorney General of Nebraska HON. J. J. SULLIVAN Assisting the attorney general in the cases instituted against members of the grain trust ALBERT W. JEFFBRIS Attorney for the Worrall Grain company in the suit pending FRA-NK S. HOWELL Attorney for the Worrall Grain company in the suit pending HERMAN AYE ' Attorney for the Worrall Grain company in the suit pending EDWARD PORTER PECK Vice-President and Manager of the Omaha Elevator company PRANK S. COWGILL President of the Trans-Mississippi Grain company GEORGE S. HAYES President of the Nebraska Grain Dealers Association in 1899, 1900, 1901, 1902 AUGUSTUS H. BEWSHBR Secretary of the Omaha Elevator company, and Secretary of the Nebraska Grain Dealers Association in 1899, 1900, 1901, 1902 EDWARD S. WESTBROOIC President of the Westbrook-Gibbons Grain company NELSON BLACKW^ELL UPDIKE President of the Updike Grain company 10 ILLUSTRATIONS J. S. BEOWN Buyer for the Trans-Mississippi Grain company HOBACE G. MILLER Secretary of the Nebraska Grain Dealers Association B. J. SMILEY Secretary of the Kansas Grain Dealers Association, who was tried, found guilty, and served his sentence in jail for violating the an ti- trust law of Kansas. HON. JAMES T. BRADY Sponsor of Senate File No. 102 in the Nebraska state legislature in 1903 ' MRS. KATE KEHOE Actively engaged in the grain business at Platte Center, Nebraska B. J. VAN DORN Independent dealer and member of the Omaha Grain Exchange Map of Nebraska showing the state divided into thirteen "Price Districts" Uncle Eeub Schneider off on a vacation The P. D. Smith elevator at St. Edwards, Neb. H. L. Aden's elevator at Eising, Neb. FLOYD J. CAMPBELL Secretary of the Nebraska-Iowa Grain company; CHAirrER 1 WORSTED BY THE TRUST It was in November, 1896, at AgneAV, Nebraska, within eighty rods of the place where as a boy I wrestled with the multiplication table in a sod schoolhouse, that, with my brother J. C. Worrall, I embarked in the business of buying and shipping gxain. Agnew is a mere siding on the Union Pacific railroad, in the nortliern part of Lancaster county. Frank Stetson, a son of Mrs. T. M. Marquette of Lincoln, was largely responsible for our determination to engage in the business, and his alignments were reenforced by the bumper corn crop of that year. The Omaha Elevator company of Omaha owned and oper- ated at tliat time the only elevator at Agnew. The opening for us seemed bright. But I have said before, and say now, that had either of us even dreamed of what we would have to face, in the years that were to follow, I doubt if we would ever have embarked in the grain business. Even then the Omaha Elevator company was the largest operator of' ele- A'ators on the Union Pacific, and the officers and agents of that road did its bidding and furnished it with all the point- ers andT information that came to their knowledge. During that first winter we bought grain from tbe farmers and shoveled it direct from the wagons into the cars, of which we got our pro rata share with the ele-vator. We did a good business in those first few months. The Nebraska Grain Dealers association, although it was in existence, was young and neither very strong nor very active. C. T. Neal of liincoln, who no-n- represents the Harris-Scotteii company of Chicago, was secretary, and the association was composed principally of Lincoln men. Because it was weak, there was competition in the buying and selling of grain at every sta- 13 tHB GfeAiN TBtJS* BXPOSBD tion in Nebraska where two or more buyers were found, tt was later, under the management of A. H. Bewsher, that the association thrived and grew until its shadow overspread the state. Of his works and methods I will have a great deal to say in the course of my story. In July, 1897, the agent of the Union Pacific at Valparaiso — there being no agent at Agnew — inf omied us that Ave could not have any more cars unless we had the grain in sight at the time of ordering them. This of course was impossible " without a place to store the grain, and for a time we were shut out of business. Immediately after the issuance of this order, which came from the general oific^ at Omaha, I went to the division superintendent, James Foley, whose office was at Lincoln. He informed me that the orders came from headquarters, and that they applied not to Aghew alone, but to every sta- tion on the Union Pacific, including branch lines. But then and there he granted us a site for the erection of an elevator. He said that the thing for us to do was to begin at once to build aji elevator, no matter how small, just so it would hold a carload of grain, had a dump and a leg, and could be loaded into the cai-s. He said: "While I am superintendent I will see to it that you get all the cars you want, and just as fast as you can get your grain in from the farmers." Often, in later years, my memory has gone back to this conversation and I have remarked on the difference between the manner in which the, grain business was handled then and now — or was, prior to the 17th day of June, 1905, when the suit of the Worrall Grain company against the Omaha Elevator company and thirty-eight other defendants was filed in the district court of Washington county. We went to work without delay and built our little ele- vator. We were driven to resort to numerous schemes to keep the information from getting to Omaha until such a time as the elevator would be so far along that no powerful WORSl'ED Si THE TRUSU 13 and antagonistic influences could stop us. We succeeded, and our elevator was completed. Again we bought grain from farmers. We paid what it was worth, taking a margin of 1 to 1^} cents on corn and oats for our profit. Our competitor, the Omaha Elevator com- pany, did but a small business. In fact, though paying no higher price, our firm was able to buy 75 per cent of the gi'ain that came to the station. And tien the trouble began. It was not long before we discovered that the prices paid by the Omaha company at our station — and consequently the prices we had to pay — were higher than at surrounding places that took the same freight rates to Mississippi rivei- points and to'Chicago. We were at a loss to understand tliis. But when we figured the freight rate we readily reached the conclusion that our competitor was trying to drive us out of business. At this point let me say that, in telling tliis story so as to giTe the farmers and "^producers of Nebraska and adjacent states a practical and intimate knowledge of the manner in Avhich the grain business in Nebraska is handled, and always at a profit to those handling it, it becomes necessary to refer to the Omaha Elevator company perhaps oftener than to any other of the many corporations doing business in the state. This is not to be construed as meaning that the management of this company is more aggressive or greedy than any of the otliers, for that is not the case. I have only the best of feel- ing for those who are at the head of this company. It is not so much the individual I would censure or condemn as it is the System that they have organized all over the state and which I denounce as tyrannical, unfair to the masses of the people,, and particularly unjust to the farmers, who are the backbone of our state, pay the most of its taxes, and bear the lion's share of the burden of maintaining schools to fit our boys to go out into the world to do battle with it and perhaps accomplish a little somethins- that will be beneficial to mankind. 14 THE GRAIN TRUST EXPOSED Day by day, then, the Omaha Elevator company continued to turn the screws a little tighter. They gradually boosted the prices until they were paying the farmers | ceait a bushel more for their com than we could get for it, and tliese prices were paid to any and all who had grain to sell. In this crisis it was the same with us as it has been uni- formly, in similar fights, with other dealers. We found that the farmers will sell their grain to whomever will pay them the most, without ever taking into consideration the reason for those higher prices. It was in November, 1897, that I first met Mr. E. P. Peck, wlio at that time was secreta.ry of the Omaha Elevator com- pany. The meeting occurred in their office at Omaha. Mr. Peck bluntly told me that they wanted their share of the grain coming to Agnew. I told him, as bluntly, that they were entitlexl to all they could get, and at whatever price they saAV fit to pay for it. I said I did not see by what right he asked us to turn business from our elevator to their elevator. Then I explained to him that my brother and I had spent our boyhood in the vicinity of Agnew; that our father had homesteaded near thej.'e in 1866; that we knew personally every farmer within a radius of tAventy miles, knew his fam- ily and children, hoAV many horses and cows and pigs and chicJcens he had, how much he owed, and to whom, and when it came due. It was owing to this acquaintance, I pointed out, that we could buy more grain at the same prices than his company could buy. H(! said he A^-as well aware of all that, but they had their investment at Agnew, and had to keep a man there to look after their business, and it was necessary that they should have their share of the grain coming to the station. The conversation came to an end without either of us liaviug made any progress. As I sat in tlie car riding home I could plainly see that the Omaha Elevator company was going to demand one-half of the grain coming to the station, J WOESTED BY THE TRUST 15 and I then and there made up my mind to fight that demand as long as I had left a dollar that would enable me to do so. Every cord and fiber of my being rebelled against entering into any such agreement as Mr. Peck desired. I thought then, and do now, that the grain business is a legitimate busi- ness and tliat every person, firm or company engaged in it is justly entitled to a reasonable compensation for the money, time, intellect and ability employed, but that it, like all other honorahle occupations, should be conducted on tlie broad lines of live and let live. Soon after my visit with Mr. Peck we ceased to receive any bids for cash grain from the Omaha Elevator company, although we had been receiving them for some time. This was proof that they did not care to do further business v/ith us. We began at once to seek an outlet for our corn to feed- ers and purchasers of single-car lots in Kansas and Missouri, and because we succeeded in this were able to continue pay- ing the same prices at Agnew paid by the Omaha company, Avhich was more than the grain was worth on the regular market. The Omaha company evened up. through being able, at that time, to get a commission from the different railroad companies in rebates and transfer charges, of which I will have something to say further along. Daring the winter and spring the auditor of^the Omaha company, Mr. M. T. Jaquith, visited "Agnew several times, and finally called on us. He asked us, straight out, if we Avere willing to enter into an agreement to make a division of the grain coming to the station. To this, and to all subsequent propositions of a like char- acter, w© returned a decided negative. He said: "You will have to, or go out of business." To this I replied that that might be, as I recognized the .facts, and knew that his company had more capital, by far, than we had. But, I told him for all that we were not frightenod by his threats of financial destruction, as w« both 16 THE GRAIN TRUST EXPOSED Lad good health aad an inclination and desire to work; that we were relying on otir own judgment, ability and intellect to make a success or failure out of our business. Alter this the battle grew fiercer and more furious. Grain began to be hauled to us through towns ten miles distant, and Ave were looked upon as being about the only grain firm in that section of the country. The traveling freight agent of the Burlington railroad called on us, arid wanted to know how we could pay such prices for grain and where we dis- posed of it for a profit. He said that his company was losing business every day on account of the high prices prevailing at our place, and as a representative of the Burlington rail- road he would like to see this "disturbance" settled so his company could get the tonnage that belonged to it at sta- tions located on its right of way. His visit was prolonged, but he Avent away without any encouragement as to what could and would be done by us. Soon after this we were called upon by a representative of the Union Pacific freight department. He also wanted to know if this "disturbance" could not be settled. He said that the other roads were very anxious to have it stopped as they were losing business. To all this I listened with an attentive ear. When he was through I told him that we Avould never consent to an equal division of the grain at that point with the Omaha company except they earned their half by hustling for it. Rome time in the spring of 1898 a representative of the Chicago & NorthAvestem railroad came to see us. He Avanted to knoAV why the prices paid for grain at Agnew could not be adjusted Avith prices paid at other points, and had the same complaint to make about his road losing business. He, like the others, went away without accomplishing any- thing, and the fight continued as before. And then there came in sight around the bend the begin- ning of the end ; an end as sure to come as that the sun will rise in the morning ; an end made inevitable by the fact that WORSTED BY THE TRUST 17" we -were fighting a great coqwration that had dollars to our dimes and many otlier elevators from which to recoup the losses sustained at Agnew. We began to notice that, do the best we could, work all day and scheme all night, our profits were slowly but surely growing less and less. We learned in bitterness of spirit the elementary lesson that, in ord^r to make any money out of the business we must be able to sell the grain for more than Ave i)aid for it. AA'hen things were- running along in this way another rep- resentative of the Omaha Elevator company called on me and wanted to agree on prices and a division of grain. He saJd: "No matter what has been done in the past, it is the future y\Q must look to. _ I would advise that you go to Omaha and see Mr. Jaquith and get this matter adjusted in the right way and manner." To this I consented. Before that man left my office we had agreed to maintain prices and divide the grain coming to the station. This was in Angust, 1898. From that day to the ITth day of June, 1905, competition has been unknown at Agnew, and the farmers would have received the same price for their grain had one elevator been sluit ^own. Soon after tliis Ave began to think someof erecting another cloAator at Toiiliy station, as there was but one tliere, owned and operated by the Omaha Elevator company. I AA^ent there on the 20th of August with the roadmaster, Mr. Rich, and !-;elocted a location. I then informed the representative of tlie Omaha company that Ave contemplated erecting the sec- ond elevator at that point. He reported the fact to his company. Within three days the same agent who had finally induced us to capitulate in the AgncAv fight called on us a^-ain. He said, brutally, that "the stuff was off." If I built at Touhy, he said, they would bust me,, as they would pay more for 2 18 THE GRAIN TRUST EXPOSED gram at both stations than I could sell it for, and they would keep it up for ten years if necessary to get my scalp. I lis- tened to this calmly, wondering if they could and would do all the things threatened. Then, when my visitor was through, I looked him squaMy in the eye, and said: "You may be able to do the things yo\i say you can do, but does that make it right? I have spent seven years of my life working for some one else, and I don't want to be a hired man as long as I live. Why are you and your company un- willing to give me a chance?" Ho said: "We ar^. But we want the business to be run in such a way that you will make money and we will also make money. You niiist be contented with operating at this station and must abandon all hope of building the second elevator at Touhy." Before he left I agreed to go to Omaha the following day and see the manager, Mr. A. B. Jaquith. I went to Omaha, and found Mr. Jaquith busy as usual. He is always that way, no matter whether he has anything to do or not. The building of the second elevator at Touhy was the subject under consideration, and we discussed it for two hours. s I took the stand that my brother and I had the God-given right to go there and go into business and that he had no right to place an iron band about our ambition to keep us from reaching out into the world and obtain a foothold that, in our old and declining years, would be the ^..ans of keep- ing the wolf from the door of us and those depending on us. I pleaded, I begged, I beseeched him, but it was all of no avail. Finally he said : "Why don-t you go up into Butler county at Foley? There is where an elevator is wanted. You do this and we won't bother you. We will be glad to do business with you if you WORSTED BY THE TBUST 19 will consent to this. We will fix up Agnew and everything will be fine." '_^*How do you want to fix up Agnew?" "Divide the grain coming to the station; both pay the same price, figure up every Monday morning and the one ahead in any amount shall drop his price a half cent, or a cent if need be, until the one behind buys enough to even up the purchases." Before leaving his office I had agreed to his conditions, and signed an agreement with him, of which I carried away a copy in my pocket. Here it is — and it is the same kind that all members of the grain trust make; the phraseology may differ but the substance is the same in all cases where there is an equal division of grain between two or more buyers : "In the interest of harmony and equity the Omaha Elevator company of Omaha and T. D. and J. C. Worrall of Agnew agree as follows: "That each is entitled to and shall have one-half of each kind of grain bought or received by them at Agnew, Nebraska. Each party to pay the same price for grain except where either party has bought grain in excess of the agreed propor- tion,' the party so doing agreeing to drop their price half a cent, a cent, or more than a cent if necessary from the regular prices until such time as the other has received their relative proportion. The prices to be paid are to be mailed to each daily, or whenever a change is made, by the Omaha Elevator company, and the same shall be effective the following morn- ing after receipt of same, and it is the duty of each party to know that others are advised and have the same prices before making any change. "It is furtlier agreed by all parties hereto that no contract shall be made for delivery the following day or any future date unless made in writing, dated and signed by the seller, and a money advance of |1 or more paid to make it binding. It is also agreed by the parties hereto that no grain shall be taken in on storage, and that grain received during the day must be paid for or check issued for same at the price in effect that day. 20 IHE QBAtN TEtST EXPOSED "Also each party to tliis agreement shall figure up their receipts at least once a week each Monday inor];img and ex- change slips with the other party, showing the number of wagon loads and bushels of each kind of grain taken in dlir- ing the previous week and the sum total, such figure show- ing all grain received, whether paid for or not. J "It is further understood and, stipulated by the parties hereto that in the e^-ent of any conditions arising which may warrant any change in the conditions of this contract that any changes made from the ones herein described must be consented to by the principals of this contract and the proper notations made under such date and be attached to this and become a part of this agreement. "It is also agreed that if eitber party hereto closes their house or discontinues the purchase of any kind of grain or cereal for one week or more they shall not participate in the division of such grain for that week or such period as they may be out of the market on such grain or cereal. "The railroad station records, the bank books, checks, and all books and papers of any nature used in tlie operation of the above named station by the parties hereto shall be open to the inspection and thorougli checking of either party here- to, and also to the arbitrator should there be a complaint made that he is requested to hear, so that it may be definitely ascertained whether the receipts thus given in accordance with the agreement are correct, and if they are found incor- rect Tvith a view of misleading or taking advantage of any party hereto it shall be considered a rank violation of the ta'ms of this agi'eement. "This agreement shall be placed in the hands of an arbi- trator, and tliere shall also be deposited with a stakeholder one hundred dollars by each party hereto as a guarantee of the faithful fulfillment of the conditions of this agreement. "That the spirit as well as the letter of this agreement be carried out as indicated herein the arbitrator with whom this agreement is left will have and we hereby grant him the power to arbitrate any case that may arise himself or choose an arbitrator to act for him ; and in case of any complaint.by either party hereto it is his duty to see that there is a hear- ing, and in the event of such arbitrator finding that either party hereto has violated the terms or spirit of this agree- ment, he shall have tbe power and it is his dut^- to render a WOBSTBD Bt THE TEUS* gl decision and to see that all the forfeits then deposited shall be paid €o the non-forfeiting party. His decision shall be final and unquestioned by either party to this agreement and .nothing either pa.rty can do in any way or manner shall affect same. "This agreement shall take effect October 20, 1898, and continue in full force until canceled by mutual consent; either party may withdraw at any time by giving ten days' notice to the other party in writing of his desire to do so, but the full terms and spirit of this agreement must be complied with up to the time of expiration." And so the deed was done. We were defeated and whipped into line, at last, and our dream of independence was ended. We had fought the good fight as honestly and courageously as we knew how, my brother and I — ^and had lost. Here- after we and our businessi would be but as a cog in a great machine: As the train sped across the fertile Nebraska fields carry- ing me homeward I looked out of the car window upon mile after mile of ripening corn and thought of what had hap- pened. I wondered if every man who embarked in the grain business had to do as I had done. I was half tempted to think that I had failed because I was young and green in the business, and that a stronger and more experienced man than I might have succeeded in maintaining his independ- ence. Since then I havo learned that my fate was the common fate of all. We put up our check for |100, payable to A. B. Gates. It was by him transferred to A. O. Wood, another employe in the Omaha Elevator company's office, and by him en- dorsed to George Lyons, who eventually cashed it. I still have that check and that contract in my possession. I played fair with our "competitors," and they, too, lived up to our agreement. In a short time I found myself be- coming careless and indifferent in the prosecution of our business. Why not? When farmers drove up and asked me the price of grain it made little difference to me whether 22 THE GKAIN TSDST EXPOSED I bought, or the other fellow. I knew if he got orerly anx- ious and ambitious and got more than his share ull I had to do was to go and tell him to reduce his price in accord- ance with our agreement, and the business would come to. us. We both had the same prices. They came from the same office, made out by the same clerk, mailed at the same time, although, be it admitted, in separate envelopes. It was rather amusing, at times, to see some farmer, anx- ious to make a good sale, working various schemes to break this oombination. He could try — but that was all the good it did him. For I was A\atching the other fellow, laying for an opportunity to get his forfeit of $100, and he, over in his office, was watching me. However, neither of us ever vio- lated the agreement, and after a year or two the money was . taken down. The agreement^ though, is still in full force and effect, with the difference that now they operate under a penalty pool of "2 — 2 — 4" instead of enforcing a physical division of gi'ain. Of this manner of doing business so as to even up profits at a station I will have more to say later on. We iiow turn our attention to Foley station, which is only a short distance from David City, where the land is as fer- tile as anywhere on earth and cultivated by an excexjtionally fine lot of people. There I formed the acquaintance of men, including Charles Sheets, William Haynes, John, and Harve Nichols, the Strubing boys, David Curry, and others, who shall be cherished in my memory as long as life shall last CHAPTER II SOME EARLY HISTORY Soon after locating at Foley our firm began buying grain and shovelling it from the farmers' wagons into the cars, a practice the railroad company was willing and even anxious to permit while our elevator was building. We had been doing business just one week, buying in that time a carload of oats, besides some wheat and rye, when, one afternoon, Louis Spelts drove in. He said he was passing by, and, noticing from the road that some work was being done, he came in to see who was doing it, and what our in- tentions were. I informed him, we were a full-fledged grain conqern and meant to do as big a business as possible. He tried in every way to discourage us, saying we could not pay expenses, much less make a living. I told him the best way to find out was to try, and that was what we purposed doing. He left us, and in a short time dealers at David City were offering farmers living near Foley a better price for grain than we were, and we began losing business. With this we raised our bids a bit, with the result that other dealers at surrounding points called on us to demand what we meant by "disturbing business" that way. Among those who called was the station agent of the Northwestern railroad at Miller- ton, four miles distant, representing himself to be a farmer. He confided to me later, however, that he called at the in- stance of the superintendent of his road who wanted liim to find out why we Avere "causing trouble." In a few days we were invited to attend a meeting vvith other grain men at David City. This v;as in October, ISOS. At this meeting it was violently declared, by- a number of dealers, that an elevator at Foley could not pay, that it would disturb prices and destroy the profits of eleven differ- 2i THE GRAIN TRUST EXPOSED ent elevators, aggregating between $20,000 and 125,000 a year. This was a subject in wliicli I felt some personal interest, and I listened with both ears. Our contest with the Omaha liilevator company was still fresh in my mind, and I wasn't aching for any more trouble. So, after considerable discus- sion, I agreed that the Omaha Elevator should send us, at Foley, tbe same price list sent to David City, Millerton, Gar- rison, Bellwood, and other points. I began to see how the gi'ain combination was reaching out and growing and taking in more territory. Uniform prices were being paid at all points in the vicinity where freight rates were the same. There was nothing for us to do but come into the local combine, and do it willingly. We went the whole hog, and -not only did what we were told to do but tried to iiifluence others to do likewise. Very shortly we made application for membership iii the Nebraska Grain Dealers association and were admitted. I began to attend the district meetings, in response to urgent demands from: lieadquarters that all dealers do this. It was constantly dinned into our ears that only by doing so, and standing firmly together, could we impress reluctant outsiders with the fact that our organization was formed to protect the grain dealers' interests and assure better bargains from the farmers. One buyer, not a member of the association, could make more trouble in a week than could be repaired in a month. If he paid a quarter- or half-cent more than the association members did at nearby stations the farmers all got restless and began making bothersome inquiries. Consequently, to whip the outsider into line and compel him to pay the same price we paid, was one of our principal objects, and I shall have something to say further along of some of the schemes . and metho'ls resorted to bring this about. It was in April, 1900, that I attended the first annual meeting of the state association. It was held in Omaha, in SOME BAELY HISTOET 25 Oreighton hall. George Hayes was re-elected president, A. H. Bewsher secretary-treasurer, and Mr. Jones of Nebraska City vice-president. Nothing of a serious nature was re- ported at tliis meeting. Everything seemed to be lovely. The membership was fast increasing, the finanoesr were in a robust condition, and the future looked very encouraging. Whfil. little trouble was brought before the meeting was of a local nature and confined to some one locality, and assur- ances A^'ere given that things would soon be adjusted "to the satisfaction of all parties interested." The "big boys" gave some good advice to us little fellows as to what we ought to do and ought not to do to make our business a howling s.uc- cess. Before adjourning it was decided that the secretary should arrange for and attend as many district meetings as seemed advisable to help build up and strengthen the as- sociation throughout the state. I might as well state here that the original object of the association was to secure better weights and inspections at the ^terminal markets. This was soon accomplished — and then the association began reacliing out for bigger things and set about the ambitious attempt to monopolize and con- trol the grain business of Nebraska, at an added profit of many millions of dollars to its members. The line houses especially worked hard to add to the membership, and so strengljien the association and advance its object. If a new member grew naughty the captains and lieutenants would be called upon to go and see the obstreper- ous one and bring him back into the fold, in case the secretary was unable to do so. And so here, more than five years ago, we had the grain trust well under way, pursuing its ends in defiance of the laws of the state of Nebraska. I Avonder how many Ne- braska farmers know that, right then, almost at the begin- ning, A. H. Bewsher, the secretary of the association, was arrested, on complaint of Attorney General Constautine J. Smyth, in the city of Omaha, charged with conspiracy in 26 THE QEAIN TEtJST EXPOSED restraint of trade? If the fact was ever reported in the news- papers I have failed to find it. So far as I have been able to learn, this early "prosecution" was born a still birth and was surreptitiously interred, with no one but those directly interested being any the wiser. But here are the facts, and they may be verified by the records : On AugTist 6, 1900, Attorney General Smyth swore out a complaint against Secretary Bewsher, who was an-ested and brought before S. I. Gordon, police judge of Omaha. The complaint, in its first count, was as follows: "State of Nebraska,^ Douglas county, City of Omaha. State of Nebraska, plaintiff, vs. "A. H. Bewsher, whose given name is unknown, defendant. "The complaint and information of Constantine J. Smyth, attorney general of the state of Nebraska, of Douglas county aforesaid, made in the name of the state of Nebraska before the judge of the police court witliin and for the city of Omaha in said county tliis 6th day of August, A. D. 1900, who be- ing duly sworn on his oath says that one A. H. - Bewsher, whose given name is unknown to this - affiant, on or about the 27th day of October, 1899, and thence continually until the day of the filing of this complaint, in the county aforesaid and within the corporate limits of t}ie city of Omaha aforesaid during the time aforesaid being in the city and county aforesaid, with other persons to the affiant unknown during the time aforesaid and in the county and city aforesaid unlawfully did conspire, combine and conf edei'ate together to -fiix the price SOME EMILY HISTORY 27 of an article of trade, that is to say, grain, -vdth the intent then and there to prevent others from con- ducting and carrying on tlie same business, that is to say the business of buying and selling grain, and from selling and trafficking in the said article, to- wit grain, contrary to the form of the statutes in such cases made and provided, and against the peace and dignity of the state of Nebraska." In all there were seven counts, similar to the foregoing. The case was certified to the district court of B«uglas county, a transcript of the proceedings in police court was made and filed, and after some time the case was dismissed by George W. Shields, county attorney of Douglas county. When, where and by whom the pressure was brought to bear on the Hon. C. J. Smyth, attorney general, or his suc- cessor, as well as the fion. George W. Shields, county at- torney, to nolle this case against the secretary of the Ne- braska Grain Dealers association is something, I am not clear on. At that time there was a plenty of proof to be had that the statutes were being violated every day by /the mem- bers of this organization. And in this connection I desire to say, in fairness to all, that the officers of the association were not wholly and solely to blame, as there were others just as deep in the mud as they were in the mire. But all this is past history. The records of the police and district courts are open and can be examined by any one who chooses to do so. The inquirer can then draw his own con- clusions as to how and why these cases were dismissed. I would not think of saying that these public officials did not have a desire to do their sworn duty, and so will drop the subject, allowing the reader to judge for himself whether anyone, and if so who, is deserving of censure. I attended my first district meeting at Lincoln, in Septem- ber, 1900. It was held at the Lindell hotel. Among those present were Prank Levering, 0. G. Crittenden of the Cen- 2S THE GKAIN TRUST EXPOSED tral Granaries company, H. O. Barber, E. R. Si)encer, 0. M. Jaques, Secretary BewsJier and many others. Tliere was a unanimity of opinion that we v.'ere paying too much for oats, and that the price should be lowered. Steps were taken to get the dealers living in Lincoln with elevators in south- ern Nebraska and in Kansas to make an effort to get the terri- tory lined up like it was north of Lincoln and in the North Platte country. This latter territory was in much better shape than the southeastern part of the state, which had too many independent dealers and dealers operating a single elevator. It always took more work' and more pressure to bring tlie single house men into line than it did the line elevator operators. Every line house man could be dei)ended on to do all in his power to stifle competition. , The watch v.'OFd was to pay the card price as it was sent to the dealer and to report fully every case coming to knowledge where any one was offering to pay more ihan the autliorizod price. The agent of any line house that was not sufficiently interested in the business of his company to do this was out of a job in a short time. This calls to my mind the fact that John D. Phillips, of Yutan, Nebraska, who lias lieen in the employ of an Omaha company for a number of vears, sxsore on the witness stand at VV'ahoo that, e\en if the dealej.'s at Mead should exceed his price one cent or more, and by so doing succeed in buying grain \^'ithin a mile of liis station, he would not report the fact to his company. I would not say that this gentleman would wilfully and deliberately commit perjury, but I must say that his memory is woefully deficient. I can call bis attention to instances where the prices paid for grain exceeded his own price and the autliorized price and he did i^eport it to his company. This, I will say frankly, was tlie right thing for him to do, as it was following instructions, and he would not have been looking after the interests of his company had he done otherwisa SOME EAELY HISTORY 29 Permit me here to deviate a bit further. Many times, as above, I will be compelled, in the course of this narrative, to deal with individuals, and in doing so I fear I will cause them to say harsh things about me for doing what I can to bring about improved conditions in the grain ti-ade. But I have said privately what I here repeat publicly, tliat at 850 North Twenty-sixth street, in the city of Lincoln, stands a ^ modest little home, beautified with a fresh coat of paint and protected by a new roof. A neat little lawn surrounds that home, and a few ti'ees, including some that are fruit-bear- ing, add to its attractiveness. The cold, bleak windg of winter and the scorching rnvs of_ the noonday sun in sum- mer each in turn haiuiiu']' and beat ag;iinst the outside walls. AMthin, dependent upon me for support and maintenance, are my wife and luy sou. And I uiu i;<)iii,n' to protect and care for those two, and provide them with all the best things of life that I can get for tliera, even though the grain trust is torn into shreds and tatters! 1 would rather leave for my boy, and for my neighbor's boy, jCQ opportunity to go forth and ^^o]•k, relying on them- selves for success, than leave to tliem a heritage of tainted wealth secured tli rough a sj-stem luuch as has been operated by the grain trust of Nebraska. At the same time I might as well candidly admit that if it had not been for the penny wise and pnund foolish policy of one individual I might never have had the courage to make this fight and this book ^^ ould ne^er have been writ- ten. Who tills man is, and what are his connections in the commercial Avorld, I will tell before I get through. And it is no pleasant task. It is not done for revenge or to "get even" a\ ith any one. But it is a part of the story of this con- spiracy and so must be told. The men with whom I have heen associated in this grain trust are, in .the social world, capital feliows, and only a fe\v of t hem would go afte- i' -^-''^t- iplpsiincs witli a liroad-aTf oFa sledge hammer. The most of tliem would use the finest 30 THE GRAIN TRUST EXPOSED — gurjyical instrnments, carcfwlly sterilized and made anti; septic, and, after they had got what they- wanted, would turn your reiiuiiiis over, with expressions of the p*)litest regret, to your sorroAvinn; friends and gi'ief-stricken family. In de- parting they might rventure to express the hope that the next m^n who ventured- to diaigTee with them or refused to yield to tlieir demands would have no friends or relatives to moui'n his departure after they got through with him. CHAPTER III CLOSING UP THE EANKS Along in January, 1901, "the "big boys" in the Nebraska grain business concluded it was high time to whip into line all the dealei-s along the line of the Missouri Pacific in the southeastern portion of the state. lu this section, because the "community of interests" was not sufficiently snug and warm, dealers' profits were much less than in the northern territory, -R'here the Nye-Schneider-Fowler company, the Trans-Mississippi Grain company, tlie Omaha Elevator com- pany, the Updike Grain company and others had matters well in hand. The moderation of tlie dealers on the Mis- souri Pacific was due, curiously enough, in large part to the earlier teachings of A. H. Bewsher, when he was connected with the Greenleaf & Baker Grain company at Atchison, and before he had become secretary of the Nebraska Grain Dealers association. In those early days, not having mas- tered the art of respectable amalgamated robbery, he had in- structed and educated the buyers to buy at 1| cents off from the card prices. This li cents represented their profits. This practice was still adhered to, very largely. Now, to the big boys of the Nebraska association, climbing up the ladder of high finance, this 1^ cents looked mighty small, and they decided on a campaig-n for bigger profits — at the expense, of course, of the farmers. Several preliminary meetings of the larger dealers were held. At these there were usually present A. B. Jaquith or E. P. Peck of the Omaha Elevator company, N. B. Up- dike or C. A. Howard of the Updike company, Frank Fowler of the Nye-Schneider-Fowler company, Frank Levering of the Central Granaries company, N. A. Duff of the Duff Grain company, F. S. Cowgill or J. S. Brown of the Trans-Missis- 32 THE GEAIN TRUST EXPOSED sippi Orain company, and John B. Wright or myself of the Nebraska Elevator company. The ohject of these meetings was to devise ways and means for bringing in more coin to the several companies. After we were well agreed it was decided, at a meeting held in the offices of the Nebraska Elevator company in the Oliver theatre block at Lincoln, that Secretary Bewsher should call a meeting at an early date of the single house operators on tlie Missouri Pacific and at near-by competitive points. The meeting was called and held January 25, and was largely attended. As nearly as I can recollect the following dealers were present : L. L. Coryell of Auburn, Mr. Taylor, of Taylor & Burchard, of Bethany, P. J. Lint, of the Greenleal Baker company, of At- chison, A. J. Denton, of Denton Bros., of Leavenworth, Ed. Wenzel of Eagle, G. W. Venner of Eagle, D. Smith of Elmwood, J. J. Trompen of Ilickmaa, C. A. Eichie of Louisville, John Tighe of Manly, Thomas Hedges of Panama, J. M. Elwell of Springfield, W. B. Banning of Union, James Tighe of Wabash, J. W. Knight of Walton. To take these dealers in hand and mold them into shape there were present ilessrs. E. P. Peck, C. G. Crittenden, Frank Levering, Frank Fowler, N. B. Updike, F. S. Cowgill, fieorge Hayes, E. S. Westbrook, and several other associa- tion leaders. Secretary Bewsher called the meeting to order. He stated that the object of the meeting was to devise means to save - dealers from competing with each other in bidding for grain NORMS BROWN Attorney General of Nebraska HON. J. J. SULLIVAN Assisting the attorney general in the cases in- stituted against members of the grain trust ALBERT W. JEFFERIS Attorney for the Worrall Grain company in the suit pending CLOSING UP THE RANKS ' 8^ Brought to a station where "there were two oi jiiore elevators. The practice of one buyer bidding against another, he truth- fully declared, destroyed the large profit that the elevator owner mi^t otherwise easily earn. The discussion dragged at the start, and progi-ess was slow. It seemed that each of the siugle house dealers present was auspicious of the others and afraid some one might tell the farmers on him if he said anything. ^ While- they were all brothers together And had pledged themselves to secrecy, , and a trusty sentinel was stationed at the door, yet sus- picion would not down, and many imagined, evidently, that they could glimpse the woolly head of an African protrud- ing from under the brush pile. 1'he idea of agreeing to divide equally with 'their competitors all the gi-ain that came to their station was ucav to the most of them, and they w^ould not readily submit to such an arrangement. Here is where the powers that be in the association got busy. A recess .was taken. Each of the big men had his little man spotted, and began Work during the recess. In a dozen places at once little conferences wore in i^rogt-ess, the big men arguing with the little men and pointing out to them the beauties of an iron-clad agreement to maintain card prices, not to give the farmer the benefit of a rise in the market, to stp'P "riding the country," and not to store grain for farmers. Attention AA-as particularly directed tp the luscious possibilitj_ of, while never going above card prices, occasionally going below them. If, for instance, the card price for No. 2 wheat was 80 cents per bushel those belonging to the trust would have a legitimate right to buy at 78 cents. But should one offer 80|- cents he must know that a universal howl would rise to heaven and all the dealers in that territory would swarm down on hira and inquire what- he meant by his "dishonorable action." The more the plan was talked the more attractive, it appeared, and many dealers . w^ere for fixing things up then and there. Rome was not built in a day, however, and 34 THE GEAIN TEUST EXPOSED seme were hard to convince that the scheme could be T'orke^, and some dealers were absent who must be made parties to the conspiracy, so it was finally agreed to adjourn the meet- ing for one week in order to bring the absentees into camp. The second meeting was larger than the first. Also things moved along more smoothly. The single house men, who had learned how the big boys were doing business, had begun to be afflicted with ravenous appetites for bigger profits. So one by one they consented to the proposals jnade, and agreed to do what the line elevator men suggested. An effort was then made to induce eacli dealer present to consent to put up a forfeit offlOO for the faithful perform- ance of the agreement. Then there was more trouble. All present were willing, by this time, to subscribe to a "gentle- men's understanding," but few liked the idea of putting up the |100. At this meeting, as well as at others subsequently held, the line 'house managers were the first to come forward and put up their $100, or whatever amount was suggested. By so doing, they shrewdly figured, they would stimulate and infiuence the little fellows. J. W. Knight of Walton refused to put uj) his money. He was willing to do anything else, but dr«w the line at that. James Tighe of Wabash and W. B. Banning of Union ex- pressed themselves the same way. On the other hand, J. M. Elwell of Springfield was ready and anxious to deposit his forfeit. Then, before the single house men should get to quarrelling among themselves, the big boy« got busy. F. J. Lint, representing the Greenleaf-Baker company, said his people were always ready to put up their money. They considered it the best investment they could make, because it enableil them to know all the time just what their competitors were doing. The representative of the Omaha Elevator company said that when an agreement was made and the money put up it gave him and his company more confidence in their compet- itor. They knew that when a wagon load of grain was drivPTl f^LOSIXG UP THE RANKS 35 onto the scales of the other company " that the farmer was getting only the "authorized price," and that tlie competitor's |100 would be forfeited if this should not prove to be the case. Frank Fowler said the posting of the forfeit could harm no honest man, as all tliat anjone was expected to do was to live religiously up to his agreement aad do the right thing, and when he did this nothing more could be asked or ex- pected. Secretary Bewsher said that it was highly necessary to have these forfeits put up, because they restored confidence, and he dA\elt on how advisable it was that the dealers should be able to have implicit confidence in each other. Thanks to such arguments as these, at a late hour the meet- ing resulted in complete success. All the.diealers present sub- scribed to the agreement and put up their checks for |100 each for forfeits. The question then arose as to how and by whom the prices were to be made and sent out. It was finally agreed that this should be done at Lincoln by the Central Granaries company and the Nebraska Elevator company. There was considerable trouble of one kind and another until the plan became thoroughly systematized, which took time. The secretary, esi)ecially, spent a great deal of hard work in get- ting this territory lined up. I have always thought, and do now, that it Mas unbecoming for men like Frank Fowler, A. B. -Jaquith, Bay Nye, Frank Levering, G. J. Bailsback, N. ^\. Duff, A. O. Cooi>er and others to use^heir influence on the little operators to compel tliem to enter into and abide by such an agreement as this. For these men are men of ability and could go -out into the world and compete fairly and openly with anybody, knowing that success would crown their efforts. Why, then, did they do it? Because ttey wanted to make more money than is possible in open competition. They were Avilling to give the little man a chance, and allow him to continue in busi- 36 THE GRAIN TEUST EXPOSED ness so long as he consented to al] their demands. But if he refused, and so "disturbed" their business and threatened to reduce their profits, they declared war against him. They either drove hira out of business by forcing the prices so high he lost money, or had the railroad company iiotify him to move off the right of way. After the "disturbing ele- ment" was wiped out it did not take long for those Avho were in friendly collusion, and true to the agreement, to recoup themselves for their losses, with compound interest, by exact- ing, if they desired, from the farmers a margin of from 3 to 11 cents on every bushel of grain that was marketed. Only occasionally did tliese "big boys" permit deviations from contract. Once in aAvhile some farmer with lots of grain to sell and a great deal of influence would put up such a holler that, by "private understanding," he would be paid a half cent or even a cent more a bushel than was paid liis neighbors. In return, he must say notliing about this concession, not even to his wife, and must use all his influ- ence to keep other farmers peaceable and contented. This, however^ was not done frequently. V. When the organization of this southeastern territory was completed the trust had the state pretty thoroughly covered. The day of competition was past. Except where dealers locally got into a squabble and exceeded card prices for a few days the farmers of Nebraska would be compelled to market their grain at whatever price a few men in Omaha and Lin- coln saw fit to fix. The management, naturally, was jubi- lant over the outcome of the Lincoln meeting. When that meeting came to an end the newly made "trust magnates" 'from the little country towns gathered in knots and groups on the streets and in the hotel lobby to discuss their prospects. Some were inclined, now that they had come into the trust camp, to be fearful and distrustful of "n future in which competition would never be permitted to show its head. CLOSING UP THE BANKS ^37 "But," said some of them, "what can we do? What would happen to us if we held out? Here is the trust gobbling up elevator after elevator, and. backed by all the railroads. How could we hope to fight it and live long enough to tell about it? It is a case of either being driven to ruin or join- ing the trust and getting all we can out of it." . By this time I hud become deeply interested in the Ne- braska Grain Dealers association. I was well and intimately acquainted with the officers and ^vith most of the important members. I had formed a good opinion of President Haj^es and Secretary Bewsher as competent business men who, CO aid be trusted to see that no opportunity to maJie a dollar was overlooked'^or neglected. Mr. Besreher, on whom, as secretary, the hardest work naturally devolved, was a tireless worker. He worked hard, worked willingly, worked cheerfully.. He had no conscien- tious scruples, Eesults were what he was after — and he was after them on the jump. Just so he got all there was in sight he was satisfied, and no questions asked. His good work soon began to tell;' its influence was felt in the pockets of the members; it made those pockets sag heavily. This in- sured him the hearty support of all of us. His salary was boosted to |3,200 a year, together with office rent, stenog- rapher, traveling expenses and other incidentals. And Bewsher was worth it — ^and much more. He was ever on the alert. One station pooled encouraged him to go to work on another. Wherever there w^as an obnoxioiis dealer he must be either crowded out or bought out. If he was on the Union Pacific the Nebraska Elevator company or the Westbrook Gibbons Grain company was ready to buy; if on the Northwestern the Nye-Schneider-Fowler company or the Updike Grain company; if on the Burlington, the Cen- tral Gra;naries company, the Ewart- Wilkinson company and others were prepared and willing to take over the property. If the elevator was poorly located- and the investment was a poor one several companies would "chip in" to defray the 38 THE GRAIN TRUST EXPOSED expense of gettiug rid of the disturber, after which losses would be rapidly recouped by turning the screws a little tighter on the farmer. "A half cent a bushel less for thirty days pays the bill, and we've got a mischief-maker the less to deal with," is a remark I have heard several times repeated. If the individual operator refused to sell, however, then the several companies around about him would all join hands to compel him to buy at losing prices or not at all and to shut off the market where he must sell his grain. In this way he would be compelled, sooner or later, to surrender, aiter which the margins would be imn^ediately increased. A local resident operating an elevator can always buy a larger share of the grain than can the agent who represents the large companies, but it has al~ways been the policy of the large companies to demand their full share of the busi- ness, and when necessary to join hands to punish the single individual until he is willing to divide the business equally. If the big company had the larger investment it demanded most generally a larger share of the business, but if the local dealer had the larger then the big company insisted that "investments cut no ligger" and demanded an equal share of the business. 41 CHAPXEiR IV THKOTTLIiNG COMPETITION r In all their operatious the large companies had the assist- ance of the railroad companies, whose officials seemed to have^ and in many instances I do not doubt did have, a per- ^ sonal interest in the matter. Generally speaking, they would absolutely refuse to permit competition with the large com- panies if the latter objected. The trust furthermore had the leading commission mer- chants in the several markets so. trained that, when they received a communication from tlie trust secretary saying that it would not be agreeable to the association for the firm to handle the business of a certain shipper, the commission men would heed the warning. They understood that to handle the grain of the blacklisted buyer meant the. loss of the business of all the dealers belonging to the association — and that would mean ruin to any commission house. If, through the exercise of much diplomacy, a farmer or shipper not operating an elevator succeeded in securing cars in which to ship his own grain the railroad company would immediately notify the big elevator companies along its line of the car numbers and initials, and the firm to which the shipment Avas consigned, and often before the commission house had received notice that the grain was on the way it had a request from the trust not to handle it. Perhaps I will be able to make myself more clearly under- stood, in this effort to explain the workings of the trust, by citing a few instances that have come to my knowledge. At Madison, on the Union Pacific railroad, J. B. Hume and the Omaha Elevator company both operated elevators. Mr. Hume also sold lumber and eoaJ. He had been in busi- ness a number of years, was a man of good business ability, iO THE GRAIN TRUST EXPOSED and was able to buy two or three times as much grain, at the same price, as could the agent of tlie Omaha Elevator com- pany. The Omaha company made several fatile efforts to induce Mr. Hume to divide business equally with it He steadily refused, and went his own way. In the summer of 1899 O'Shea & McBride, a land and real estate firm at Madi- son, decided to go into the grain business. After much difficulty they got a site, and, in the fall of 1900, opened up business. A merry war followed. Prices were screwed up to the top notch, but everybody stayed. Hume seemed hold- ing his own, and continued refusing overtures by the two other elevators for a division of business and an agreement on prices. Finally a division meeting of the association was held at Norfolk, and Mr. Hume was induced to attend, ac- companied by his assistant, Mr. Eobertson. J. P. Barron, the traveling freight agent of the Union Pacific, was there to back up the Omaha company, which was represented by its manager, Mr. Jaquith. ' Secretarj'^ Bewsher was also present. O'Shea and McBrlde were both on hand. Pressure was at once brought to bear on Hume to consent to a pooling of business and prices. Hume flatly refused, and the more they argued and threatened and wheedled him the more de- termined he was in his refusal. They tliey put the screws on him. Mr. Barron notified him that he bnd been instructed by the Union Pacific officials to notify Hume that, unless he consented to the demands of the other two buyers, he would have to move his elevator off their right of way. He said the fight was very distasteful to the Union Pacific officials, and they had adopted this means of settling it. Hume then saw that everybody was against him and that his case was absolutely hopeless. All his years of honest dealing and the reputation he had earned and the friendships he had made were worth not a penny to him, as a stranger could come in and compel him to divide equally on all the busi- ness coming to that market He capitulated, came into the THROTTLING COMPETITION 41 trust, and business thereafter at Madison was done strictly on trust principles. At Humphrey the Crowell Lumber & Grain company had an elevator on the North-^Vestern right of way, and on the Union Pacific was an elevator operated by the Omaha Ele- vator company, and another operated by Bodewig Brothers, who lived in Humphrey. Bodewig Brothers commanded the larger share o^ the business, and repeatedly refused the de- mands of the trust companies that they divide. Then the latter began the merciless work of extermination. They screwed prices up to such a point there was no profit but actual loss in the business. The Bodewig Brothers, with their small capital, were unable to stand the pressure. Rather than consent to join the trust they sold out to O'Shea & Mc- Bride of IMadison — and the trust had pooled another station. In the fall of 1900 tlie Nebraska Elevator company bought from Amos Wright, at Virginia, in Gage county, a small elevator located on the right of way of the Rock Island rail- road. On the Kansas City &, Northwestern railroad, at the same point, were two elevators, OAvned by Joel Dobbs and J. V. Allen & Son. For years this town had been a storm center in tlie grain trade of that vicinity, and grain had been hauled to it through towns milea distant. - The dealers had never agreed on prices nor pooled in any manner. Each paid what he pleased, and the highest bidder got the stuff. Soon after the Nebraska Elevator company bought the Wright elevator, efforts were made to get the Virginia buyers to- gether, in which efforts Kidd & Company of Beatrice and the Central Granaries company joined, they having elevators at near-by stations. The result was that, on July 1, 1902, in room 78 of the Paddock hotel at Beatrice, the following agreement was entered into : , "Agreement br and between J. V. Allen and Joel Dobbs of Virginia, Nebraska, and the Nebraska Ele- vator company of Lincoln, Nebraska: 42 THE GRAIN TEUST EXPOSED "J. V. Allen agre^ to close his elevator at Vir- ginia frQm this date, July 1, 1902, and keep it closed' until March 1, 1903j and to do no grain business of any kind at Virginia station during the time this agreement is in effect. Aiid Joel Dobbs and the Ne- braska Elevator company agree to pay J. V. Allen, on the 1st and 15th of each month, 2 cents per bushel on 25 per cent of all the corn and oats coming to the station and 4 cents per bushel on 25 per cent of all the wheat. And as a guarantee that each party will comply with his part of this agreement we will deposit with Henry Gund at Lincoln f 100 each in cash to be paid by him to the party right> fully claiming the same." With Allen thus summarily disposed of, the other two ele- vators pooled on prices. The contract was religiously lived up to. Allen collected his money the 1st and 15th of each month until April, 1902, when Mr. Gund returned to each of the three parties to the agreement his f 100. Soon after the agreement came to an end a scheme was concocted to get rid of Allen altogether and get him off the right of way. The matter was taken up before the railroad ofiicials and they, friendly and accommodating as always to the big concern^ ordered him to move off. He moved his office and scales, and then sold out to a farmers' organiza- tion. The farmers wanted a bigger elevator and applied for a site. They were refused. They then built an elevator on private ground, and asked the railroad to put in a switch. The railroad again refused. The farmers brought suit in supreme court. Then, in due time, the railroad made over- tures of peace. The suit was dismissed, and the track was extended to the farmers' elevator, which is opei'ating to-day. It is needless to say that there is no division of business or pooling of prices at Virginia any more. At Platte Center on the Union Pacific railroad there were two elevators, one operated by the Omaha Elevator company, tHEOTTLlNG COMPETITION 4S and the other by Van Allen & Heyl. Mra K. A. Kehoe, a widow, who was conducting a farm implement business, un- dertook to buy grain and load the cars directly from the farmers' wagons. The railroad company soon grew very re- luctant about furnishing her with cars, but she had grit and determination enough to get about all she needed to take care of her business. Her husband, John Kehoe, had been a prominent and well-liked business man, and was an old settler with a wide circle of friends. These naturally stood by Mra Kehoe and favored her in many ways. ^ The regTilar grain dealers were not long in making trouble. They became insistent in their importunities — which were lit- tle short of demands — to Mrs. K^oe that she join the com- bination and divide the gTain coming to the station. Union Pacific ofacials and Mr. Jaquith were called in, and day after day she had to face trouble and threats and increasing difficulties in carrying on her business. She held out for a long while, but was finally beaten -into line. The fact that she was a woman and had her own way to make in the world did not serve to protect her from the rapacity and brutal treatment of the Nebraska Grain Dealers association. One of the hardest and most complicated fights in the his- tory of the grain business in Nebraska was made at Firth, in the southern part of Lancaster county during the fall and Avinter of 1900-1. There had been two elevators at this sta- tion for many years, one owned and operated by W. J. Crandall, who ran a mill in connection with his elevator, and the other by William McElvane. Both were menlbers of the association, and so they got along swimmingly together, pay- ing the same prices, dividing the business and making fat profits. The country round about was well-settled and fer- tile, and the several years of good crops put these fortunate members of the' trust on Easy street. - Pi«r.,ics!ing what to do with all their money one day, Oan- : IcElvane decided to start a bank. There was then 4^ THE GEAIN TEUST EXPOSED but one bank in the town, managed by John Van Burg. As- sociating themselves with several other persons the two in- corporated under the state banking laws, and started to do a general banking business in competition with Van Burg's bank. That started the trouble. Van Burg did not relish the move, and he decided to retaliate by breaking up their mo- nopoly of the grain business. He soon had organized^ a farmers' elevator company, which made demands upon the Burlington railroad for a site on which to erect an elevator. Then Crandall and McElvane got frightened, and called on the association for help. It Avas decided by Burlington of- ficials, in conference with members of the association, that the best thing to do was for McElvane to sell his elevator, .thus separating the two buyers who had incorporated the second bank, which should placate the farmers. Accordingly Thomas Cochrane of Lincoln bought the McElvane elevator. The plan worked beautifully for awhile, but the farmers soon found that Ci^andall and Cochrane were getting along as amicably together as had Crandall and McElvane, and that the change had not helped their market a penny's worth. They accordingly renewed their application for a site. Many conferences were held with them, and every effort was made to get them to lie down once more, but without avail. These homy-handed sons of toil were determined to get into the grain business and break up the combination that was getting rich and. fat off the sweat of their brows. The farmers warned everybody concerned that, if they were not given a site, they would build on private ground, and. from this de- termination they refused to budge an inch. So a job was put up on the farmers. Cochrane sold them his elevator, and Crandall was left to do the rest. He did it — and did the job brown. The dismayed farmers soon found that Crandall was paying more for grain than either he or they could sell it for in any market in the world. He en- larged the capacity of his mill, and turned his attention to THBOTTLING COMPETITION 45 milling wheat and corn, for by so doing he could get a profit out of what he was buying, while the farmers' elevator was sure to meet with a loss. Oandall's action demoralized the trade at surrounding points. Adams and Hickman on the Burlington, Pickerell, Oortlaiid and Princton on the Union Pacific, and Panama and Sprague on the Missouri Pacific were practically shut out of business. The farmers from all points of the compass, and from many miles distant, hauled their grain to Firth. This was playing the game too strong. Orandall was called upon the carpet by the association, time after time, but he declined to take any thought of the interests of the line elevators at other points until he had driven the farmers out of business at Firth. And Van Burg, the banker, and head of the farmers' movement, stood valiantly by his guns and fought like a Trojan. Before long the village of Firth and all the tributary terri- tory was torn up over this grain fight. Each side had warm friends and bitter enemies. Everybody was forced to join »with one faction or the other. The fight even got into the churches. T^^omen fell out with each other, and little chil- dren wouldn't play with other children if their parents were on different sides of this contest. The railroad agent got in- volved, and lost his job. It was the dividing line in politics no less than in church affairs. If Van Burg contributed' to' one minister Orandall refused to recognize him and con- tributed to another. Men came to blows, and several times a street riot was imminent. All the while the association was trying to bring the fight to an end. greeting after meeting of grain magnates was held at Lincoln to consider the situation. Finally H. O. Barber of Lincoln suggested that Orandall be bought out, bank, mill, elevatot, home, real estate, church pew and all. Then, it was thought, it would be an easy matter to patch things up with Van Burg and proceed to eucher the farmers. Others thought it would be better to buy out Van Burg, and this latter plan 46 THE GRAIN TRUST EXPOSED was finally adopted, with the proviiso that Crandall agree to ^et into line again, to divide the grain and maintain "prices in the event the trust thus came to his assistance. To the Nebraska Elevator company was assigned the duty of con- ferring with Crandall. The. person having the negotiations in charge had an early meeting with Crandall at the com- pany's offtce in the Fraternity building, at Lincoln. Cran- dall agreed that, if Van Burg and the farmers were bought out, he would take the bank ofif the purchaser's hands, but insisted that he would divide the grain business only on the basis that he get all the wheat coming to the station and half the corn and oats. Nothing could be done along this line. _ Suddenly the fight died a natural death. Van Burg quietly disposed of his interests in the bank and elevator to outside parties, and with them Crandall patched up an agree- ment, peace was declared, and the war was over. ■ At St. Edwards, Nebraska, there were three elevators, one owned by P. D. Smith, one by H. E. Fonda & Bro., and one by John Penfield. The Omaha Elevator company, after con- sulting the records of the Union Pacific railroad company, decided to erect a fourth. They were given a site, and on it built a 20,000 bushel house. A few days before their ele- vator ^va,s completed their traveling representative called on 'Mr. Smith. He informed him that they were about ready to do business and asked him if he was ready to agree on an equal division of grain all around and to maintain prices, Mt. Smith asked Avhethcr, in the division of grain, he would have to figure, as a part of his share, grain raised on land owned by himself, and he was told that he would. This was more than Smith could stand. He told the Omaha Elevator company, then and there, what it had been told many times before, and has been told many times since; that it "could go to hell!" He said he would consent to nothing. "My father," he said, "was- one of the first settlers in Boone county. Everybody knows us. We have hosts of- friends. We have worked hard and built up a good business. We THROTTLING COMPETITION 47 have an elevator that holds 100,000 bushels of grain, and your company comes here and puts in a 20,000 bushel ele- vator and demands an equal division with me! I won't do it!" "All right," said the Omaha representative, coolly; "but in time we will compel you." The war began. Grain was soon being marketed at St; Edwards that nat- urally belonged to points miles distant. ,The buyers at some of these stations, in ail f -defense, were forced to raise their bids, and so the disturbance spread wider and wider. At one time it looked as though .eveiy grain station north of the Platte was going to be disturbed on account of the Omaha company "butting in" at St. Edwards to demand an equal . division of the grain. P. D. Smith's acquaintances well know that he is a fighter. Being financially well fixed, and spending his nights and days on the scene of conflict, he quite naturally had a de- cisive advantage over his competitors whose interests at St. Edwards were being looked after by a $40 a month man. Smith pushed his advantage to the limit, and the fight grew warmer and warmer, making trouble spread, like waves caused by a stone thrown into the water, to all points of the compass, and reaching out to stations scores of miles distant. The consequence was the railroads came to the assistance of the great grain triist that was trying to squeeze out a bold and fearless little competitor. Horace G. Burt, then presi- dent of the Union Pacific, called to him tJiose in charge of the grain traffic on that road and warned them they would somehow have to put an end to this trouble. When- they told him they could not, he summoned Mr. Smith to come to Union Pacific headquarters at Omaha. Smitlccame. In the office of Chai'les J. Lane, first assist- ant freight agent, he offered to arbitrate the differences be- tween himself and the Omaha Elevator company. The offer was accepted. Smith chose, as his member of the arbitration ^8 THE GRAIN TRUST EXPOSED board, L. R. Cottrell. The railroad comi>any selected ex- Governor James E.-Boyd. The Omaha Elevator company chose, as the third member, "Bill" Sunderland. After hearing the statement of the case from both s.idea this board rendered a split verdict. It ordered that, while Smith should agree to an equal division of business with the Omaha company, he should not" be required to account for and figure in as a part of his receipts, grain raised on his own land. Both s-ides accepted the verdict, and abided by it. That killed the last vestige of competition in the elevator business at St. Edwards, and the trust had added another scalp to its belt. At FuUerton, in Nance county, were two elevators, oper- ated by the Omaha Elevator company and the Westbrook; Gibbon company. E. D. Gould, a cattleman, was a heavy buyer of corn, feeding, as he did, hundreds of steers. The management of the two elevators concluded that Gould was buying and feeding too much corn on Avhich they were get- ting no rake-off. They decided that Gould must be com- pelled to pay tribute to them on the corn he bought They told liim so. They said it was an outrage for him to buy this corn direct from the farmers and feed to his steers. They told him to his face that, unless he would consent to go in with them and pool prices and make a jackpot of the profits, share and share alike, they would push the price of com so high as to compel him to lose money on his cattle- feeding. Not only that, but he was notified that the same arrangement must be made as to Belgrade, the next station above, where he also fed cattle, and where the same com- panies operated elevators. Gould was compelled to surrender to these infamous de- mands. In pursuance of this agreement — or, I should say, in submission to this hold-up — he paid, to the Omaha Ele- vator company, on December 28, 1899, |29.25; January 19, 1900, 180.80; February 7, 1900, $25.36. On January 1, 1900, the Westbrook company paid to the Omaha Elevator com- THEOTTLING COMPETITION 49 paiiy $218.11. From December to February this company received from Goulrl and Westbrook |353.53 in "vdvet" rev- enue from these two stations, besidies making big money on every bushel of grain shipped. For, it should be remembered, in addition to their legitimate profit they made an added profit due to the pool to keep prices low; in addition to that the railroad company paid them 1^ cesnts per hundred for unloading tlieir cai's when they got to Council Bluffs; still in addition to that, prior to the passage of the Elkins bill, they enjoyed a cut in rates of from 3 to 5 cents per hundred I)ounds. It will be readily understood that when these great cor- poration^ protected by their grain trust, received these con- cessions, rebates and favors it was extremely difficult for the little dealers to compete with them and lixe. But if the little dealer joined the crowd, helped turn the screw a notch tighter on the farmer, and otherAvise did what he was told to do by Mr. Peck, Frank Fowler, N.oly on the grain marketed at the station. While there were other buyers there Pete did the lion's share of the business, because everybody knew him, liked him and trusted him. Finally a line house, a member of the trust, came along and • bought the other elevator. Soon after installing an agent and commencing to do business the trust company sent a man to see him. It was the old, familiar demand. He must consent to "fix things." He must consent to maintain prices and to divide the business. Pete objected. He told them to pay all they pleased to whom they pleased and he would do the same. And Pete was obstinate in this. Secretary Bew- shej" made several trips to Rising City to whip him into line, but could do nothing with him. Finally J. F. Barron, rep- resenting the freight department of the Union Pacific, went to see him and brought such pressure to bear "that Pete saw it was a hopeless fight. He consented to a "divvy" and to post a forfeit that he would "tote fair " He drew from the bank |200 in cash and entrusted it to Mr. Barron to be by him deposited with F. S. Cowgill, manager of the Trans- Mississippi Grain company as stakeholder. Mr. Barron, re- turning to Omaha by way of David City and Columbus, collected |400 from the Omaha Elevator company and f200 from H. Garhan, which he deposited with Mr. Cowgill as agreed. That settled the fight at Rising City. The trust had gobbled it up, and the farmers were at its mercy. On March 20, 1901, Mr. Reinheimer sold out and quit the business. I have had many talks with him since, and he has told me repeatedly that he would not have sold out could he have done business as he wanted to, but he could not consent to remain there like a dummy that jumped whenever some- body behind the curtain pulled the strings. Next after Rein- THROTTLING COMPETITIOK B3 heimer gave up the fight the line houses turned in on Garhan and froze him out. They had things at Rising City their own way. I have heard members of the tmst who wdre interested in this cold blooded deal express themselves in this way : "We did^a mighty good job when we got those fellows out of the business. They were nothing but disturbers. As long as they were there there could be no such thing as harmony and prosperity in the grain business at Rising City.'' But the trouble at liising City was not yet over. A young man living there, H. L. Aden, was the next to go up against the trust. He built a shovel^ house,, put in a pair of scales, and began bidding to^farmers for their grain. The trust met the situation promptly, and proposed' at oiice to crush the life out of this new intruder. Word was sent to the elevator men in the section to which Rising City belonged to come to Omaha at once, as there was business of importance to be attended to. I was among those who were invited and who attended the meeting, which was held in May, 1901, in the office of the Omaha Elevator company. There were present Messrs. "Jaquith, Peckj Fow- ler, Bewsher, Egglesten, .Updike and Westbrook, besides* ■lyself. Aden was a young man and a poor man. He could prob- , ably have been bought out for |1,000. Yet here were several men drawing big salaries for managing big concerns who had tossed sleeplessly at nights, and worn out the bed cloth- ing because this young man had, in a very modest way, gone into the grain business. It was agreed at this meeting that it sliould be ascertained to what firms Aden sold and shipped the grain he bought, and that the secretary of the trust should then notify those firms that if they bought any more of Aden's grain they would get no more shipments from members of the trust. This course was followed. The result was that Aden was shut out.- He found, to his surprise and consternation, that it was impossible for him to market the grain he bought He 54 THE GitAIN TEtST BXPOSBO * could get no bids at an'j prica He decided that the difficulty was on account of his not owning an elev*tor, and decided to build one. But when he applied to the railroad company for a site the site was refused him. He figured oilt that this was on account of his not being a memher of the Nebraska, Grain Dealers association, so he applied for membership. The secretai'y of the association informed him his applica- tion could not be considered until he owned and was ojjer- ating ail elevator. Aden, in despei*ation, then bought private grounds near the track and built his elevator. He plunged actively into the grain business. Because "he paid i to | cent a bushel more than the trust buyers did he was enabled to do a good business. Then he met trouble coming from a new source. His elevator was small. It, would hold only "about four cars of grain. The trust elevators were ail large ones. The trust arranged with the railroad officials that cars should be fur- nished Eising City only at infrequent intervals. No matter if everybody ordered cars they were not to come until the right* sign was given. The scheme worked to perfection. Aden would fill his elevator in one or two daj^s, and "would order cars. No cars would come. The other houses would order cars also, and their managers would swear because they didn't get them.' But, in the meantime, they could go right along buying, just the same, and filling their big eleyators, while Aden was with- out room for another bushel. Then, when the big elevators Avere'full at last, the cars would arrive— about 15 or 20 each for the trust elevators, and 4 for Aden: After the elevators were emptied the process would be repeated. In consequence the trust elevators Avere buvina; all tlio ti" e, whilfe Aden could buy only a third or a fonrth of t'c 'irne, h<»cause he had no room to store more gruiri, and could not get cars to empty his elevator. Aden, while he couldn't see through a grindstone, was still able to see himself in a looking-glass. He ran up the THEOTTLING COMPETITION 55 white flag and offered to sell out to the trusty saying he wanted to join t!ae association and start an elevator else- where where no one would object. The proposition was laid before Messrs. Peck, Westbrook, Wrigh1>-and myself. Aden asked |1,500 for his elevator, and we decided to buy it. The Omaha Elevator company, the Westbrook-Gibbons company and the Nebraska Elevator company each put in .'pSOO and Avith .this the elevator was purchased. It stands there at Rising City, empty to-day. There has not been a bushel of grain in it for three years. The weeds ai;id grass have groAvn around it, and owls and bats rendezvous in its timbers. On the records of Butler county it stands in the name of O. H. Eggleston, trustee. The taxes and insurance are pro-rated annaally among the firms that bougTit it and promptly paid. The statement has been made, more than once, that the |1,500 paid to buy this elevator and .put it out of business was saved in one month's time during the busy season. Though it had been impossible for Aden to handle more than 50,000 bushels of grain in one year yet, by offering a higher price, and a price that was a little fairer to the farmer, he compelled the trust companies to bid up also, not only at Rising City but at surrounding points. The farmers, however, having had a taste of competition, decided not to leave themselves at the mercy of the trust any longer. They formed a company among themselves and put up so bold a front that, rather than see a new elevator go in, the Nebraska Elevator company sold out to them. Since that time there has been epmpetition in the grain business at Rising City. Aden, in the meantime, went to Raymond, in Lancaster county, and bought an elevator there. The line house de- manded at once that he come into camp, or they would freeze him out of business. He agreed to "be good." He was ready to divide tie grain, pay whatever price he was told to, pay, put up ills forfeit of '|100, and to do generally whatever he was ordered to do, and nothing more. It was either this, or 56 THB GRAIN TRUST EXPOSED have tlie ugly word "Failure" written after his name, to he a source of shame to himself and to his children as long as any of them should live. THE TRUST GROWS STRONGER I have told the story of how the trust, at the district meet- ing held at Lincoln, effectually destroyed competition along the line of the Missouri Pacific raik-oad, and how elated the leading members interested were over the result. I have now to tell of a similar meeting, held at Wahoo, on February 15, 1901. This meeting was called in the interest of the com- panies opei-ating elevators at and in the vicinity of Wahoo,— known as the Wahoo district. The district has always been considered an important one, comprising the territory s©uth of the Platte river to Lincoln, and west to Valparaiso. For one reason and another there was considerable "friction" in the district, and it had to be patched up. The wof d had been passed along the line that it w^as necessary for all the "big boys" to be there, the same giants of the grain trade in Ne- braska whose faces wei*e still beaming over the success achieved at the Lincoln meeting. And they all came. There were present at the meeting : A. B. and M. T. Jaquith of the Omaha Elevator company, Messrs. Howard and Cone of the Updike Grain company, Mr. Lawless Of the Duff Grain company, Frank Fowler of the Nye-Schneider-Fowler company, G. J. Railsback of Railsback Bros., E. S. Westbrook of the Westbrook-Gibbons Grain com- pany, mysel#, representing the Nebraska. Elevator company, and a number of single house men, including David Bowen of Weston, Ernest Peck of Cedar Bluffs, George Holtorf, and quite a number of others whose names I have forgotten. There was some question raised, at the outset, about al- lowing Trenmore Cone and David Bowen to participate in the meeting, as some of the big members doubted their "fidel- ity" to the trust. They were earnestly vouched for by other members, however, and were allowed to remain. 58 ISB ^AIN TRUST EXPOSED The Wahoo situation was" taken up first. There had been trouble among the Wahoo buyers, owin-<5 to the occasional refusal of Otto Ostenberg, an independent dealer on the Bur- lington, and Mr. Monteen, an independent dealer on the Union Pacific, to be governed and abide by the card prices ^sent them. This had a tendency to irritate Mr. Cone, the buyer for the Updike people, and in consequence there was frequently real competition in the business at Wahoo, the bidding becoming very spirited. It -was necessary to whip the two independents into line, and it was done, then and there, at that meeting, both of them consenting to put up their flOO forfeits to abide by card prices and follow the as- sociation rules in all respects thereafter. If took much per- suasive talk on the part of A. B. Jaquith, Prank Fowler and others to bring this about. Then there was trouble about getting David Bowen, rep- resenting the ^Veston ^tock and Grain company, and Ernest Peck, representing the Cedar Bluffs Farmers Elevator com- pany, to consent to the posting of forfeits. Threats and ar- guments, judiciously mingled, finally brought Bowen to time, but Peck was more difficulE lie declaJ-ed he could not put up a forfeit and keep his directors and stockholders ig-norant of the fact. Mr. Fowler came to his assistance, vouching for his honesty, and declaring that he would fulfil his agreement without putting up a forfeit. To this A. B. Jaquith objected. Business, he declared, was business. He didn't believe in playing favorites, or in giving one man more consideration than Avas shown others. He demanded the posting of the forfeit. A heated discussion was precipitated, in which nearly every one present took part The question was finally put to a vote, with the result that Peck was excused from putting up his $100, with the distinct understanding that Mr. Fowler would be held strictly responsible foi; his carrying out of the letter and spirit of the agreement. Following the settlement of this difficulty the trouble over Trenmore Cone broke out afresh. During recess both Mr. THE TRUST GROWS STRONGER 59 -Fowler and JNIr. Hailsback declared that Mr. Cone, who was the Updike buyer at Wahoo, should not be allowed to be present or take part in apaj association meetings; they de- clared that his ideas were at variance with the plans and methods of the association and that it was only a question of time until hQ would "peach" and make trouble for everybody. The question was dfscussed at length and it was decided to notify the Updike people that, in the future, Cone's presence was not desired at association meetings. The trouble with Cone was he was tot) zealous in behalf of his employer. He, would actually exert hilnself to get busi- ness for the Updikes. While he would pay card prices for grain, he was ^oo much addicted to making little presents, such as a new pair of shoes-,or a piece of dress goods,, to farm- ers' wives, and had been known to present a keg of beer to fai'mers selling him a thousand bushels of grain or more. These practices, it was uuanimously agreed, must be stopped. Neither would Cone be allowed to pay more than card prices for grain bought to sell at his feed stDre in bushel and half- bushel lots — for that, too, had a tendency to "disturb trade." In this way things were fixed up in the Wahoo district. Before the meeting' adjourned practically all the causes of trouble had been eliminated and there-was no reason to think that competition would again show its ugly head to bring to the farmers more money for their grain than the bosses at Omaha, Fremont, Lincoln and Nebraska City were willing to allow them. The annual meeting of the state association for 1901 was held in April, at Lincoln, and was largely attended by deal- ers ':^em all over the state. Prior to the convening of the convention I had been solicited, by a number of members, to° aspire to become an officer. I had demurred, on the ground that I was comparatively a new member, gxeen in the busi- ness and that there were older and better posted men who could do more to advance the interests of the association than I could. But my bashf ulness was overruled, and I was 60 THE GRAIN TRUST EXPOSED nominated and unanimously elected a member of the gov- erning committee. At this meeting there were present a great many gi-ain men from outside the state, representing commission firms in St. Louis, Kansas City, Minneapolis, and Chicago, who were anxious to have the. Nebraska Grain Dealers association be- come a member of tbe National Grain Dealers association.. To this proposal there was spirited opposition. Among those who were most strenuously opposed to joining the national association was Mr. McConahugby of Holdrege,.at that time representing the Millmine & Bodnaan company of Chicago. He and other members argued that the Nebraska association was organized, to control the Nebraska field, that it was suc- ceeding excellently in the undertaking, that this task Avas big enough, and there was no practical necessity for joining the national association,- which he did not think would be able to be of much assistance to the grain dealers of Nebraska. The convention voted almost unanimously against joining the national association, Tjut expressed the readiness of the Ne- braska association to cooperate at all times with the larger organization whenever it would be mutually beneficial to do so. George H. Hayes was reelected president and August H. Bewsher secretary-treasurer. The meeting was eminently successful in every particular, and the state was becoming more and more helpless in the coils of the grain trust. But, not to allow a single dollar to get away that might by any hook or crook be brought into the pockets "of the members, the secretary was again insti'ucted to hold as many district meetings as possible, at such points as Omaha, Lincoln,. Weeping Water, Falls City, Nebraska City, PaAvnee City, Beatrice, Fairbury, Superior, Geneva, Eastings, Grand Is- land, Kearney, Columbus, Norfolk and Sioux City. The mem- bers were urged to attend these meetings, whether held in their own distiict or not, in order that they might mutually strengthen and encourage one another. Many meetings were THE TKUSX GROWS STEONGEE 61 held, during the year, and many "lost lambs" were gathered into the fold, bringing thousands of dollars additional into the pockets of the members of the association. For every independent dealer added to the trust meant so much less competition, lower prices, and added profits. The farmer, of course, paid the fiddler. It was along during the fall of 1901 that the line dealers on the Union Pacific^ the iS^orth-Western, the Burlington and . the Kock Island railroads would .confer together on every day that there was a change in price, with the purpose of fix- ing all prices on all roads at practically the same figure for the same distance from market. The "price committee" con- sisting of five members, of which I shall hare something to say later, had not at that time been named and so there was often more or less friction among the^big line houses, , not intentionally, but because they, were not thoroughly posted concerning each other's prices. At this time the Nebraska Elevator company sent from its offices at Lincoln from 50 to 75 cards every day that prices were changed; the Central Granj^ies company sent a great many more, and the Omaha and Fremont compani^ regularly sent their price cards to all stations along their lines of elevators. -, But, while prices were kept down in this way, and profits Ifvere piled up, the farmers were getting dissatisfied. They began to claim that the elevator men were milking them too much ; that prices were too low and. the dealers' profits exor- bitant. Oftentimes they tried to get cars and ship their own grain, and sometimes they succeeded, reaping a handsome margin over what they would haye realized by selling to the buyer at their home station. Those matters were discussed in the district meetings, and steps were taken to defeat this movement of the farmers, which threatened grave danger if allowed to go unchecked. An aggressive campaign was opened up, directed against the managers of the various railroads. It was insisted that the railroads must be much more "conservative" about fur- 62 THE GRAIN TRUST EXPOSED nishitig the farmers with cars. Also pressure was brought to bear on commission firms and buyers at the terminal mar- kets. Trips were made for this purpose by the secretary and members of the governing committee to Chicago, St. Louis, Kansas City, j\Iinneapolis and other grain markets, where receivers of grain were bluntly informed that the Nebraska association Avas very much opposed to their accei)ting car- load shipments direct from the farmers. It was pointed out that the practice had a tendency to breed among the farmers dissatisfaction with tlie elevator service, especially in cases where the market advanced and the farmer shipper realized .from 3 to 7 cents a bushel more for his grain than he was offered by the buyer at home. The farmer might easily clear $50 a car over and above what he would have made by selling to the home elevator, and he would spread the news broad- cast among his neighbors, with the result that there would be oceans of trouble. The pressure brought to bear upon the railroad jmanagers and the big commission houses Avas not A^ithout immediate result. In consequence, farmers i\ho felt they were being robbed by the trust, and decided to ship for themselves, ran up against two obstacles, either one of Avhich was enough to lay them out cold. They couldn't get cars from the railroad company, and they couldn't find a market for their grain. At Valparaiso in 1901, there were three elevators operated by the Nebraska Elevator company, the Omaha Elevator company, and by R. K. Johnson, a local single house dealer. The Omaha Elevator company's house had been erected dur- ing the spring and winter months, over the protests of the Union Pacific officials and the other dealers engaged in busi- ness at that place. • It was a 20,000 bushel house. On June 7, Mr. Spencer and myself, representing the Nebraska Eleva- tor company, .and i\Ir. A. B. Jaquith, representing the Omaha Elevator compauy, met at Valparaiso with l\Ir. Johnson, with the object of agreeing upon a basis of dividing thie grain that came to that station. Mr. Johnson's elevator was IHE TKtrST GROWS STEONGEtt 63 of some 60,000 bushel capacity, and as soon as the Omaha, Elevator company's 20,000 bushel house was completed, that company demanded of Mr. Johnson that it be given one-third of the grain coming to the station, to which he objected. Con siderable friction followed, and this meeting was the con se^iuence. Mr. Johnson promptly expressed a desire that an agree- ment be reached on the basis that each buyer "go it alone" • each to buy all the grain he could buy, and pay for it what ever price he saw fit.. To this, of course, the line houses ob- jecte(^. In conformity with their rule of being able to' know at all times just what all buyers were doing, they declared that^nothing short of an agreement to divide purchases and maintain prices woUld satisfy them, and that unless matters could be fixed up in this way they would institute a war, the outcome of which would certainly be disastrous to My. John- son. Finally, and with manifest reluctance, Mr. Johnson said that while he was averse to entering into any pool or combination, he nevertheless recognized that he could not do business at that place against the combined strength of the other two corporations; he would therefore consent to a com- bination that would give him 50 per cent of the grain. He said : "I have lived here for many years. I homeateaded th6 ground Avhere my elevator stands. - On that homestead my children, all of them, first saw the light of day; on that homestead some of them are buried. I have worked hard and have endeavored to build up a trade and a business that would assure me a competency in my declining years, and I don't think it right, Mr. jaquith, for the Omaha Elevator company to come in here and erect a 20,000 bushel elevator, and as soon as that elevator is completed and they are ready to talce in grain, demand that I, who have lived here and done business with these farmers for more than a quarter of a century, make an equal division with them. I am intimately and personally acquainted with every farmer 64 THE GEAIN TRUST EXPOSED who comes to town. Some of them I have accomimodated in the years gone by, and they appre^ate the accommodation, and to-day they will sell me their grain rather than to any one else paying the same price. For you to come in in this way, and by brute force deprive me of the advantages gained through many years of- the hardest work, I think is a damn- able injustice, and I would not submit to it were I not help- less." Mr. Jaquith said: "We have built an elevator that cost us $4,500. It is as accessible and with as good a drive- way as yours. We have just as much a right to do business here as you have, and if you will not consent to a division upon the basis we have demanded, we will have to fight ; and I warn you now that we "svill put up a fight that will last as long as the Omaha Elevator company lasts." » Mr. Johnson replied, bluntly, that he would not agree to divide with the Omaha Elevator company, or any one else, on an equal basis. He said : "If I were to do that, in a short time along would come some other man and erect a fourth elevator, and as soon as it was completed he would demand his share, and again reduce my business. I will not do it." The meeting then broke up. There was another conference held, and there was a great deal of talk. Plans and schemes of every kind that could be conjured up by man were invoked to bring about a solution of this difficulty. Here was a cor- poration with great wealth demanding of a single individual who had devoted his life to building up one elevator that he share equally with it in the business of the grain trade at his station. -The f4,500 they had put into their elevator repre- sented all the money they had invested in the town. Their business was run by a |40 per month man. Every dollar they made aside from paying actual expenses was with- drawn from the town and invested elsewhere. On the other hand, every dollar of profit made by Mr. Johnson was either put into property in Valparaiso or vicinity, or devoted to keei^ing up his home and supporting hia family. The money he made was all spent there. The FliANK S. HOWELL Attorney for the Worrall Grain company in the suit pending HERMAN AYE Attorney for the Worrall Grain company in , the suit pending ipi ^•. i^HF i/S^ M w^ 1 ^^^K J ShP B WBKk '^F JP SJ?' -'iXSwR ■9^9 ^^ *'**«^ #^W A.^ t2 ^^v ^IwBB "^ ^^§ ^ 1 Jm ^^^H m w EDWARD PORTER PECK Vice-President and Manager of the Omaha Elevator company THE TRUST GROWS STRONGEfi G5 -money tliat the corporation made was- all spent away from there, but the corporation had unlimited strength, and Mr. Johnson was powerless. At length, realizing his help- lessness, he agreed to be satisfied with a division that would give him 37 per cent of the business, the Omaha Elevator company -33 pej* cent, and the Nebraska Elevator company 30 per cent. A -written agreement was entered into. Each party thereto put up his .forfeit of flOO, and* the agreement and*the money were placed in the hands of Secretary Bew- slier of the trust, and were by him turned over to his suc- cessor, Horace G. Miller. As soonas this was accomplished ■ peace reigned supreme. As usual, the trust had triumphed, competition had been stifled, andi:he farmers had again been victimized. Z^- - The closing of the agreement with Mr. Johnson was looked upon with great satisfaction by dealers at Stations in the vicinity of Valparaiso. It was especially enjoyed by the Nye-Schneider-Fowler company and the Updike Grain com- pany, who operated elevators at Ceresco, only ten miles dis- tant, and who in consequence were generally compelled to meet Valparaiso prices. When there was competition at ValpaxaisOj and prices accordingly were fair to the farmer, these idealers at Ceresco did not enjoy it in the least, as it re- duced their own exorbitant profits. There was at that time. and is now marketed at Ceresco, an exceptionally large amount of grain, and the amount of coin of the realm taken in profits from the producers around this station each year -amounts to a great many thousands of dollars, not one of which those engaged in the business are willing to lose. During the winter of 1901 and the spring of 1902 there were held numerous meetings of the members of the Ne- braska Grain Dealers association in Omaha and in Lincoln. The meetings were always held at one or the other of these towns, and for two reasons. In the first place it was pos- sible to secure a larger attendance, and in tlie second there was not so much danger of attracting attention as there 6 66 THE GRAIN TRUST EXPOSED woul(L.be if the meeting were held in a smaller town. If a largely attended meeting of the grain men should be held in a smaller town it would almost always happen that a leak would be sprung somewhere, and if the editor of the local paper was awake he generally "got next" to what was hap- pening, and would have a story of the meeting in the next week's issue of |iis paper. Such stories, it will be readily believed, weres not at all appreciated by the members of the association. Their watchword was "mum," and their con- stant endeavor was to keep their every transaction quiet, and to say nothing to outsiders. Above all, they were anxious to keep out of the papers, as they knew that if the searchlight of publicity should be turned on tliem and what they were doing trouble would surely follow, and the jig would be up. The annual meeting of 1902 was held in Omaha. I found it, for family reasons, impossible to be present. My work for the past year, however, had been highly satisfactory to the association, and I was reelected, together with George H. Hayes, A. H. Bewsher, «and the others. That spring, at the request of E. J. Smiley, secretary of the Kansas Grain Dealers association, I attended the annual meeting of 1;;heir association, which was held at Topeka. I found there that everything was reported running smoothly with the exception of local troubles here and there, caused by farmers' organizations breaking into the grain business at places where they were not wanted. And here permit me to say that I have yet to know of a farmers' organization go- ing into the grain business at any place where it was wanted. I came away from Topeka, however, convinced that the Kan- sas association was not in as good shape as was ours in Nebraska, although I was giving the Kansas association my hearty support, as the corporation I represented was a member of both. Many times the majority stockholders of my company informed me that they war' il me to go into the pool and combination at every place possible, as that was the way to make money. I was invited by Mr. Smiley to at- THE TRUST GROWS STRONGER 67 tend district meetings held in Kansas, in the territory in which we operated, and did attend a number. These meet- ings, like those held in Nebraska, were behind closed doors, with a trusted person on the outside to see that no eaves- droppers coukyearn what was being said or done. During August and September, 1902, the members of the association ha'd a great deal of trouble among themselves over the grading of the wheat that was offered for sale. There were all grades of wheat^ No. 2, No. 3, No. 4, and no gi-ade at all, all brought to the elevators the same day. A great deal of aggressive and heroic work was done by the leading members of the association to patch yp the differences and secure harmonious action. Word was sent out to all the big line house operators to come to Omaha for the meeting held in Updike's office September 8. Among those who -attended -were W. H. Ferguson, Frank Levering, George H. Hayes, N. A. Duff, Frank Fowler, A. B. Jaquith, N. B. Updike, E. S. Westbrook, G. J. Rails- back, F. S. Cowgill, T. D. Worrall, James Bell, C. C. Cro^ll, J. A. Hamilton, Floyd J. Campbell, H. O. Barber, J. B. Wright, and a number of lesser lights. All were mote or less interested in the meeting, as it had been called for a specific purpose, and that was to adopt, if possible, a uniform card to bemused by all members of the association in sending out pi-ices, so there could be no mistakes made by any agent or buyer have more authority than othips. A committee of three was appointed to draft a blank price card. This com- mittee consisted of Frank Fowler, 0. G. Crittenden, and A. B. Jaqiiith, who were asked to report to the meeting imme- diately after lunch. The members of the committee asked each dealer present to draw up a skeleton form and submit it to them for reference, saying that from these different skeletons they would make up and ask to have adopted, a uniform price card. These cards were to be used by all dealers in the state, and would be uniform- in directions re- o-arding districts and cards. The committee went to work 68 THE GRAIN TRUST EXPOSEO iind deliberated for some time. Two hoi*s or more were spcL in getting a card satisfactory to all parties interested. Some of tbe readers of this volume may quite naturally be inclined to ask why I participated in and encouraged this and other schemes for the upbuilding of the grain trust, to the detriment of the farmer. In answer I might say that I was the active manager and minority stockholder in a corporation that was doing a large business in the buying and selling of grain, and the actual expenses, including salaries, rents, taxes, insurance, repairs and incidentals amounted to be- tween eighty and one hundred dollars per day for every day in the year. I, like many others, in the business,- was eager, not only to assist my company in meeting running and oper- ating expenses, but to have a good pot left for the stock- holders at the end of the year. The more -heartily I entered into all the schemes, pools, and combinations, the better was the prospect for good profits. If I failed or refused to join in this conspiracy i knew too well that my action would be criticized, and that my company would soon be searching for some one who would faithfully do its bidding, leaving me to se<^k employment elsewhere. After a great deal of friction, our committee agreed upon a uniform price card. A copy was prepared and turned over to the secretary, with instructioii£ to have 25,000 cards printed, and send them to tlie line elevator operators, and others who had ij^e for them. The secretary as well as the members were instructed to use all their influences to bring about the general use of these price cards. At that time a price committee Avas talked of, but no definite action was taken until later on. In accordance with instructions, the cards were printed and sent out, some to the Nye-Schneider-Fowler company of Fremont, some to the Nebraska Elevator company of Lin- coln, some to the Central Granaries company of Lincoln, some to the Ilayes-Eames Elevator company of Hastings, some to W. H. Ferguson of Hastings, and some to the DufE THE TRUST GROWS STRONGEE 69 Grain company of Nebraska City,— in fact to all the oper- ators that sent out price cards to dealers. The cards had no more than reached their destinations than objections began to be made to the wording, and another meeting had to he, called- to rectify the mistalces made, which was held the fol- lowing week, on Tuesday or Wednesday. This second meet ing was attended, not only by all those who were present at the first meeting, but by a number of additional members, It was discoA^ered that a mistake had been made, and thai the- use of the cards that had been adopted would result in giving the farmer a little the best of it, or in other worlds, that the gi'ain dealers would not be getting all that it was poS;Sible to get The 25,000 cards that had been prepared were accordingly called in or destroyed, and others were printed to take their place. These new cards, it may well be imagined, left the farmers entirely out in the cold. When the mistalve had been rectified, the members returned to their homes and went zealously to work carrying out the in- structions given at the meeting. After some little time, and ft-hen the rough corners had been smoothed off here, there, and yonder, the use of the cards became universal. The cards have been used constantly from that date until the time of the issuance of the restraining order by Judge Barnes, prohibiting the grain dealers association from send- ing them out. It took time, of course, and much hard work, to get the^e cards in general use, and its successful accom- plishment caused great elation among the members. This led t'o other and more ambitious work along this line, and from that time until October, the question of a price com- mittee was disctissed at all district meetings held. I attended district meetings at Fairbury, Lincoln and Weeping Water, where the subject was" thoroughly discussed, and where every one thought it would be a grand good thing for the grain dealers. ).f such a committee could be created. CHAPTER VI BIRTH OF THE PRICE COMMITTEE It was in Octoher, 1902, at the offices of the Omaha Eleva- tor company in the Bee building, that a scheme was per- fected by E. P. Peck, Frank Fowler, N. B. Updiije. E. S. YS^estbrook, G. J. Railsback, George Hayes, A. H. Bewsher, F. S. Cowgill, James Bell, Frank Leveriiiii-, invself, and other members of the association, that destroyed the last vestige of competition in the grain business in twelve of the thirteen districts in the entire state of Nebraska. At the hour of, midnight, on October 29, when the voices of little children , are no longer heard in innocent glee on the streets or farm, they having been put into trundle beds by loving fathers and mothers, the deed -uas done. Historians may write of schemes more dastardly in years to come, but not so at the present time. At that hour when tie hum of commercial life was silent, we find men planning, conniving, and scheming to further their own selfish ends, at the cost oJE the fanners and producers and toiling masses of the entire state. It was there and then that a price committ-ee oi five men was created and authorized to make and control the prices to be paid farmers for all the grain they had to sell and dispose of. A. map of the entire state was obtained, and thirteen groups jr districts were created. These districts were as follows: District Number One. Pawnee and Richardson Counties. District Number Two. Johnson, Otoe, Cass, Nemaha, and Sarpy Counties. District Number Three. Part of Lancaster, Gage, part of Jefferson and Thayer Counties. BIRTH OF THE PEICE COMMITTEE 71 District Number Four. /■• Saline, part of Jefferson, and part of Seward County. District Number Piva Saunders, and part of Lancaster Couaty. District Number Six. Butler and Polk Counties. District Number Se\:en. Part of Seward, Fillmore, part of Thayer, and part of Nuckolls County. District Number Eigjit York, Hamilton, and part of Clay County. District Number Nine. Adams. District Number Ten.. Webster, and part of Nuckolls, and part of Clay County. District Number Eleven. Franklin, Kearney, Phelps, Harlan, and all west of these counties and south of the Platte river. District Number Twelve. Douglas, Washington, Dodge, Cummg, Colfax, Stanton, Platte, Madison, Nance, Boone, Antelope, Burt, Thurston, Dakota, Wayne, Cedar, and Pierce. (The last six named counties, while they belonged to District Number Twelve, 's^'ere priced by the ]Min- neajKjlis dealers, and prices were sent from Sioux City, fowji.) District Number Thirteen. Merrick, Hall, Howard, Greclej^ Valley, Sher- man, Buffalo, Dawson, Custer, and the counties west and north of the Platte river. ^It was agreed that this committee should take Chicagme dissatisfied with . prices that were to be paid. If there is anything that aggra- vates a farmer more than anything else, it is for him to take a load of gTain to his station, and on his way home meet Farmer Brown Avho has sold a load of grain at another sta- tion at a better price. They stop and chat for a few mo- ments, and one says to the other : "Where have you been?" "Why I have been over to. .• station with a load of corn." "What did you get for it?" "I got forty and a half. What have you been hauling?" "Why I hauled a load of corn over to station and only got forty cents!" The conclusion arrived at right then and there is that one farmer did not get what his corn was worth, and that he was robbed of a half cent per bushel. He goes home. The next day being Sunday, he takes his wife and family, and drives over to visit with farmer 0. While there he tells the cir- cumstances surrounding the selling of a load of corn the day liefore. The two of them agree there is something wrong, and they are not long in beginning to agitate for the organization of a farmers' elevator. BIRTH OF THE PRICE COMMITTEE 73 f It was to provide against any and all such contingencies that the price coTninittee was created, so as to have prices uniform and satisfactory. The farmer would then feel that when he received the same price fo^r his grain that was being paid at surrounding points he was actually getting all that it was worth. Because he knew there were different elevator concerns operating at these places, and so would be led to believe that there was comi)etition in the business, never dreaming that prices were made by five individual's, and that -tliese prices so made controlled all prices in the grain grow- ing counties of the state of Nebraska. The only differences to be allowed in prices would be on account of varying freiglit rates to the Mississippi river. Tlie question now arose as to how this price committee should be constituted, atid in this much caution was talcen, in order that no errors might be allowed to creep into the scheme. It was the intention of all parties to make this plan as nearly perfect as possible, and by so doing to avoid friction of all kind. Some thought that the proper method would be to have a committee of five or seven appointed to make the price, and then hire a clerk for |50 or |60 a month, get him a desk in a basement or attic in some building in Omaha, and allow him to talk with no one but the secretary concerning this matter, and to ask no questions, but do as he was told. Others thought differently. Their idea, was that the proper method would be for the managers of the old liue houses to divide up and take the tei-ritory naturally belonging to them, and that they could reach in the shortest possible time. This would divide the responsibility for send- ing out these price lists. After much talk it was decided that the Omaha Elevator company, the Updike Grain company, the Nye-Schneider- Fowler company, the. Central Granaries company, and the Nebraska Elevator company should constitute the price committee. That they should confer together each day when- ever there was to be a change in prices, by long distance tele- 74 THE GRAIN TRUST EXPOSED phone, and then send out, from their respective offioes, the prices tliat had been agreed upon. A-gain the reader may ask "the question. If this was wrong, why did you enter into this conspiracy or combination? And again I answer, for the reason that had I not done so, the corporation of which I was the active manager would have been driven out of the grain business, and I would have been compelled to hunt a new job, or seek employment at some other vocation. Rather than do this, I thought the best thing to do was to do in Rome as the Romans did, and get out of the business all that it was possible to get out of it. It was understood that in the making of prices the active managers of the big line elevator companies were to be con- sulted, and that an agreement must be reached before the price could be made. The Nye-Schneider-Fowler company of Fremont has a private wire running from its office to the Bee building in Omaha, and at 1 :30 each day, when the prices were changed, the parties in- Omaha, after conferring together, would call Mr. Fowler of Fremont, and he in turn would call ]Mr. Levering of the Central Granaries company of Lincoln, and the four of them would be on the wire at the same time. They would then and there agree upon one price for all kinds of grain which should be paid the farmers. As soon as Mi'. Levering or Mr. Slater of Lincoln got through talking with Mr. Fowler, they would in turn call the office of the Nebraska Elevator^ company, and let them know what had been agreed upon. Immediately after this conversation the price was given to some clerk in the different offices, and the cards were made out and sent to the agents and operators along the different lines of railroad. The Omaha Elevator company would send opt price cards to all of their agents and a great many competitors of theirs at different points on the Union Pacific road. The Nye-Schneider-Fowler com- pany sent prices to their agents and competitors along th North Western road. The Updike Grain company would sem prices to their agents and competitors along the line of the 6I&TH OF THE PEIOB OOMMITTES T5 North- Western road, where they operated. I think that the Central Granaries company of Lincoln sent out more cards than any other company in Nebraska. The Nebraska Ele^ vator company sent price cards along the Union Pacific from Lincoln south into Kansas, and on the Eock Island in southern and eastern Nebraska and northern Kansas. In fifteen minutes after the telephonic conversation was held and the price agreed upon, the cards were being made out, and inside of an hour or an hour and a half they were ready to be mailed. It no doubt seems strange to a great many honest and unsuspecting people that a scheme of this kind could be successfully used to tlirottle competition throughout the state, while the farmers of Nebraska would still be hood- winked into thinking that they were b'eing paid for their ^ grain all that it was worth, and that there was competition at every -station where there were two or more elevators. Soon after this system had been put into successful opera- tion in Nebraska, the secretary, together with the secretary of the Kansas association, Mr. E. J. Smiley, undertook to make prices for that partof Kansas extending along the main line of the Union Pacific from Tdpeka west, and all of its branches, including the territory between the state line and the main line of the Union Pacific, and this is the manner in which it was done. Immediately after the closing of the -marked prices were sent to^Bellville, Cuba, Hiawatha, and Manhattan, Kansas, and by parties at those points cards were made out and sent to different dealers just as was done _ in Nebraska. Soon after this system was inaugurated, the secretary of the ' Kansas Grain Dealers > association went down into Eush county, Kansas, and Avhile there succeeded in fixing up a pool at a station, only to be arrested soon after- ward, ciiarged with violation of the anti-trust law. He was released on bail until the case should come to trial. This had a tendency to frighten the" price maimers in Kansas, and also those in Nebraska. Some thought that the safest thing to do under the circumstances, was to abolish the price com- f 6 tSB GRAIN TRUST EXPOSED mittee, whicTi seemed to be a dangerous institution. There were in fact many rumors indicating trouble, and a spirited contest was on for the election of members for the legislature, in both states. The word .had been passed along the line, that a determined effort would be made by the farmers to secure, from these legislatures, relief from the impositions and burdens placed upon them by the grain dealers associa- tions of the two states. In a short time the Kansas dealers ceased to cooperate with those in Nebraska, and pulled out. Nothing, however, daunted the spirit of the price cohimittee in Nebraska. These members went on from day to day, making out and mailing the price cards just as though noth- ing had ever happened, just as though Mr. Smiley had never been arrested, and just as though they felt secure that no one would ever make serious trouble for them in this state. Early in December, 1902, a meeting was held in the office of the Nebraska Elevator company, at Lincoln, at which a great many coDaplimentary words were spoken of the price committee, and of the Avay and manner in which it had done its work. B"'or now all that the dealers had to do was to pay the card price, take what grain came to them, and ask no questions as to where the cards came from, as no one seemed to know, as they were not signed by any one, nor did they bear the nme of the town from which they were mailed. The single house men and independent dealers in the country would pay the large companies iifty cents a month for the expense of sending out these cards. They would address a pack of self addressed envelopes and send them to head- quarters or wherever they were instructed to Siend them. These cards, bearing the prices, would co]ne back regularly, and with no friction whatever. CHAPTER VII HANDLING A LEGISLATURE It now becomes necessary to devote some considerable space to the legislative session of 1903. Prior to and at the time of the meeting of the legislature, the members of the Nebraska Grain . Dealers association were badly frightened as it looked as , though tliis legislature would be compelled to, give the farmer some relief from the impositions of the line house dealers. By this t«me there had sprung up all over the state a, demand for sites on which farmers' organizations could erect elevators, in order that they might themselyes Ship" the grain that they raised. For a long time the different railroad companies had fought them and resisted their de- mands for locations on the right of way on which to erect devators. In consequence there was a general demand dur- ing the fall campaign of 1902 for legislation that w()uld compel railroad companies to grant elevator sites to inde- pendent dealers. It became a paramount issue in*a great many representative and senatorial districts. In. a great many districts, candidates endorsing the farmers' demands were^elected, among them being James Brady, senator from Boone county, and Mr. Ramsey, a representative from Gage county. Soon after the legislature met it became apparent to all ■members as well as to the lobby that some legislation must be and would be enacted that would give the farmers Relief. The farmers stood at the legislative bar demanding action, and -something had to be done. Early in the session House Roll No. 73 was introduced by Mr. JRamsey of Gage county. Soon after this Senator Brady inia-oduced Senate Pile No. 102. These bills Avere thereafter known as the Ramsey and Brady bills, respectively. 78 THE GBAIN TRUST EXPOSED As iso&n as tliese measures were introduced, a meeting of all the big grain dealers in the state was called, to be held at Lincoln. This meeting, like a. great many others, was held in the office of the Nebraska Eleivator company. Prior to this meeting a great deal of quiet investigation had been under way, on the ^rt of some of the leading members of the association, to ascertain just what could and what could not^ be done under the circumstances. It was conceded that radi- cal legislation was almost unanimously demanded by the farmers, and whether or not such legislation could be de- feated, either openly or covertly, was the question- consid- ered. A legislative committee had previously been appointed, consisting of three members, Mr. Steinmeyer, a former mem- ber of the legislature, from Clatonia, Gage county, John Trompen, a former state senator from Hickman, Lancaster county, and myself. This committee had not at that time held any meeting for the purpose of acting on legislatioTtt, but as soon as the Ramsey and Brady bills were introduced, the committee and association alike became very busy, and it was decided that steps must at once be taken to defeat these^ measures, po matter at what cost. It was agreed that the elevator operators could well afford to pay f 500 per elevator rather than have a law placed upon our statute books which would virtually throw down the bars to competition on the part of farmers' organizations throughout the state. An as- sessment of |500 per elevator would have raised an enor- mously large fund to be spent in th6 legislature. It was generally believed, however, that so large an assessment as this would not be necessary, and that the legislation de- manded *by the farmers could be defeated by the judicious and intelligent use of a reasonable sum of money. At the meeting of which .1 have spoken, there were present John B. \^'^ight, N. A. Duff, C. G. Crittenden, Frank Fowler, E. P. Peck, I'loyd J. Campbell, N. B. Updike, W. H. Fergu- son, C. J. ]\riles, Walter Holmquist, James Bell, W. H. Tay- lor, H. O. Barber, O. H. Eggleston, and the members of the HANDLING A LEfilSLATUEB 79 legislative committee. That committee was authorized and empowered to call at its discretion, on the individual mem- bers of ^tlie association, for personal work and funds with which to defeat tlie inimical legislation. It was further agreed that Secretary Bewsher, under instructions from the legislative committee, should devote his time to defeating this legislation, which he did. I can honestly say for him, that during the session of the legislature he worked hard, earnestly, and faithfully for the association which paid him his salary. J Mr. Kamsey, and most of the farmer memhers of the legis- lature were honest in the advocacy of legislation such as the farmers demanded. Soon after' House Koll No. 73 and Senate File JSo. 102, and the Hastings and other bills were introduced, the fight becaine fierce and fast and furious be- tween the farmers and the grain trust. On our part an as- sessment was made for funds mth which to carry on this fight The money that was raised was disposed of according to the best judgment of the secretary and the members of the legislative committee. To our legislative fund the cor-, porations named below contributed a^ follows: Central Granaries company $100.00 Jaques Grain company 100 .00 Wells-Hord Grain company 100.00 W. H. Ferguson 100.00 Hayes-Eames Elevator company 100.00 Dufif Grain company. 100.00 Ewart- Wilkinson Grain company 50 . 00 Trans-Mississippi Grain company 100.00 Nye-Schneider-Fowler company 100 . 00 Updike Grain company 100 . 00 Qiaaha Elevator company 100 . 00 Westbrook-Gibbons Grain company 100 .)00 Nebraska-Iowa Grain company. . . ■ 100.00 Nebraska Elevator company 100 . 00 F. P. VanWinkle , 100.00 80 THE GEAIN TRUST EXPOSED This was not all the money that was spent ciaring the days - of this session by the Nebraska Grain trust, for an assess- ment was made of |5 per elevator, and in addition to this, something like |1,000 was taken out of the treasury t© meet -the demands made upon the legislative committea All told, Ave spent about |4,000. I am not in ^possession of any data or records having to do with the work done at this session of the legislature, because in the presence of the secretary, A. H. Bewsher, they were all destroyed, and this chapter of my book is written entirely, from memory. It w^as the wish of the leaders of the association that no records or documents that might some time make trouble should be left in exist- ence, as some time their hiding place, however secure, might be found, and they be brought to light. If that should hap-, pen the line house managers, all of whom had talSen an im- portant part in the work of the winter, might be called upon to explain some things that in the full glare of publicity might not look just right. Accordingly, every word of writ- ing bearing upon that winter's work, was consigned to the flames.^ R. B. Schneider of Fremont was a tower of strength:- in our fight before the legislature, and his influence was equaled by none other. lie, more than any one else, assisted in "bringing results." He was a politician, and closely con- nected and intimately acquainted A\ith. other influential men present in Lincoln that winter, who had in charge the task of defeating all legislation antagonistic to any and all cor- porations. This fact gave him a strong pull, and an easily apparent advantage over the members of the legislative committee who knew very little about politics, and were un- acquainted with the political schemes that would bring about ' the defeat of important measures. Another advantage Mr. Schneider had was his being personally acquainted with every mpiber of the house and senate who belonged to the same political party with Avhich he was affiliated, which, of course^ gave him additional strength and influence. Naturally, therefore, Mr. Schneider was able to accomplish much good HANDLING A LBGIStATUKE 81 for the Nebraska Grain Dealers association, whose legisla- tive committee at the same time was leaving no stone un- turned to bring about the defeat of both the Ramsey and Brady bills, in the form in which they were originally introduced. The committee and those who were assisting it, worked un- ceasingly, day and night. Neither time nor expense were ever taken into account Members of the legislature were stopped on tlie streets, in the; lobbies of the hotel, and solicited for assistance in the defeat of these measures. The fact was soon disclosed that the bills "tor grain ele- vator legislation Avere more generally discussed and consid- ered of greater public importance than almost any measure pending before that legislature. The elevator- legislation became the all-absorbing topic for conversation among niem- bers and outsiders. The grain lobby was constantly provid- ing generous and hospitable entertainment for members of the house and senate, the bills for which were paid by the grain trust. While the members w^ere being thus entertained, and while friendly relations were in this wise being estab- lished, the secretary, the members of the legislative com- mittee, and quite a number of outside persons ^ho were on the pay-roll of the grain trust that winter, were holding caucuses that began early and lasted until midnight, to de- vise ways and means to defeat the purpose of the Ramsey and Brady bills. Meeting with them Avere prominent railroad officials, leading attorneys, bank officers, business men, and even farmers ; the men, in fact, in any and all walks of life AVho for any reason might be al)le to assist us in accomplish- ing our end. Influential men were brought to Lincoln from all sections of the state, to labor with members with whom they were acquainted. Mr. Peck came down from Omaha to use his persuasiA-e powers with a leading senator from Doug- las county. ]Mr.,;||'ow]er came down from Fremont to^ talk with the member from Dodge county; Mr. Duff of Otoe and 82 THE GRAIN TRUST EXPOSED Mr. Ritchie of Cass were also on hand to help swing their^ members into line. These prominent members of the association all answered cheerfully to the call for assistance, and informed the legiSr lative committee that they awaited its commands, and in all respects were much readier with their assistance- than they have been recently to testify and tell the truth in the suit brought by the ^Vorrall Grain company, or the proceedings instituted by Attorney General Norris Brown. It became necessary for the legislative committee to use lubricating oil in large quantities, and another assessment had to be made upon the members of the association. Re- sponses were cheerfully made, and frequently with the re- mittances came words of congratulation and encouragement to the members of the committee. Mr. Schneider came back to Lincoln, personally to assist in the fight Victory was sniffed in the air. The dark and angry clouds that hung so close to the ground in the beginning had lifted. The white winged dove of peace hung over the scene, and cooed in tones more musical than pen can describe or tongue can imitate: "You have fought the good fight; you have won the prize; come enter into the place I have prepared for you and partake from the bounteous storehouse of the farmers of all that is good for man." Then presto change! Of a sudden the dark and anp^^ clouds swept with ominous mutterings, close to the ground once more. It seemed as though a cyclone was about to swoop down upon us and sweep all our plans and schemes and expectations of success from off the face of the earth. Then followed some ti-ying days for the members of the Nebraska Grain Dealers association, who were so selfish andj greedy that nothing short of a cyclone could have causeass and sunflowers and cocklebura will grow in the streets of your cities, but destroy your cities SANDLINQ a LEGlSLATURfi 6S and save your farms, and the cities will spring up as if by magic.'* Truer words were never spoken. Yet here was an associa- tion of men burning the midnight oil, in a greedy effort to .. prevent everybody who would not submit to their 'orders from if iljeing placed on an equal footing with them in a legitimate business, and to forbid the farmers from having an^ say as to the terms on which they should market that produce that feeds the people of all the world. I will say now, that if all .; those who participated in that fell conspiracy can rest com- fortably in their beds at night, their consciences satisfied that what they did was right and for the, interests of all the peo- ple, they can do a whole lot more than I think they ^an. It was growing late in the session, and the farmer members were beginning to feel nervous lest the day set for final ad- journment should come upon them with nothing done in the way of elevator legislation which the people were deinanding. Consequently, one evening, the Ramsey bill was made a special order in the house for the next morning, at 10 o'clock. Members dared not vote against the motion to this effect, and we were accordingly unable to head it off. Promptly at 10 o'clock the next day the bill was called up and briefly con- sidered, and passed the house without a dissenting vote. This bill, as it originally passed the house^ would have afforded a fair measure of relief to the farmers of Nebraska, , Over in the senate, however, was pending the Brady bill, a measure that gave the grain trust much more uneasiness than any that had been introduced during this session. In our fight against this measure, we found great assistance in the fact of its having been introduced by a member belong- ..; ing to the minority party. This fact alone made it unlikely that this excellent measure would ever become a law. In- asmuch as popular clamor was so compelling that the mem- bers, before they could go home and face their constituents, had to pass ^ome elevator bill, it was deemed wise by the grain trust to accept the less obnoxious bill, and then en- S4 THE GRAIN TRUST EXPOSED deavor to kill it by means of cunningly ^\-orked amendments to be tackled onto it in one branch or the other of the legisla- ture. When this line- of action had been agreed upon, all those who had been placing obstacles of divers and sundry kinds in the path of all the elevator bills, began at once to take an active part in rushing the Ramsey bill through. It was thought that by so doing, the Brady bill could be prevented from passing either house, and it was the Brady bill that, above-all others, the gTain trust wished to have sidetracked.. The part that I personally took in the defeat of.tliese meas- ures was inspired solely by selfish reasons. I was deeply ; interested in the grain business as a dealer and member of the iS^ebraska Grain Dealers association. I spent my time and my pro rata share of money to defeat all the gTain bills that were introduced during this session. For doing this I have no excuse or apologies to offer. When you are in Rome you must do as the Romans do. In politics I have always voted the democratic ticket and in church matters I lean to- ward the Congregationalists, although I will admit that it is a very poor lean. Both of these time-honored and battle- scarred organizations are thoroughly democratic, and are in favor of majority rule. So it was with me in this legisla- tive fight in the winter of 1903. No matter what my indi- vidual opinion might be, I had cast my lot with men engaged in this business, and was willing to sink or swim Avith them, and I wodced hard and faithfully without any hope or ex- pectation of reward aside from that which our company would receive in the same way and manner with all others engaged in carrying on a grain business at that tima Every man Avho was interested worked hard to accomplish the same end. No organization of any kind ever gave more en- thusiastic and loyal support than the members of tlie Ne- braska Grain Dealers association gave to the legislative com- mittee and to Becrotary Bewsher. Tliere was no murmur or word of complaint or discouragement uttered that I ever HANDLING A LEGISLATTJHfi 8S heard of, by anv member of the association, until after the suit of the Wovrall Grain ' company was begun, -vvliich was two years and three months after, and I remember very definitely that at the annual meeting of the association, held in Lincoln after the legislature adjourned, the legislative com.mittee and especially its chairman— myself — was given a vote of thanks, by all members rising to their- feet, and every niemb&r rose Without a -single exception. The state- ment was. there openly made, on the floor, that no such results ^ ,could -possibly have been obtained by any other members of the association. ' ^ Nevertheless, and in the face of these facts, one of the at- Torneys for the defendants, in the suit brought against the grain trust, did knowingly make use of language and insinuat- ing remarks relative to the expenditure of the money that was assessed and paid over to the members of the legislative committee. I believe now that these insinuations originated in his own fertile brain, and that, no such suspicions were ever entertained or uttered by any member of the trust in- terested in grain legislation during the winter of 1903. In my humble opinion these utterances were entirely gratuitous and uncalled for, and were " unbecoming to any one, even though he be a hired attorney, and employed by the oppo- site side. The ways of attorneys are passing strange, but there is one law that they never- forget, and of which they never for a moment lose sight, and that is the law of "com- ,pensation." " To return to House' Roll No. 73. The bill came to the senate, was considered in the committee of the whole, was there amended, as amended was recommended for passage, and did pass. And right there, in open session, the life and >souiwere beaten out of tlie bill in the broad light of day, and none but a few members of the trust any the wiser. For the amendment was cunningly contrived to make the whole law invalid. This was done by amending the hodj of the bill in an important part, and by failing to amend its 8(» *EtB GBAIN TEUST EXPOSED title. The few members of the trust who were in the deal were of course aware of this fact, but none of the friends and advocates of the Ramsey bill awakened to the sad truth until long after the legislature adjourned. As amended, the bill was sent back to the house. Before it reached that body, however, Mr. Ramsey had been warned, delicately but convincingly, that he must accept the senate amendments, as it would be dangerous to the, bill to refuse. He had only to accept the amendments, it was pointed out to him, to insure the passage of the bill. His triumph and his fame would then be secure. Children yet unborn would praise him for having saved the farmers of Nebraska, and his name would be honored long after his bones had crumbled into dust. He took the bait. When the bill reached the house Mr. Ramsey arose in his place and moved that the house concur in the senate amendments. The motion was seconded, put, and carried. After the passage of this bill all other measures of a sim- ilar nature were allowed to sleep peacefully and quietly until the closing days of the session, when a job lot was made of the entire outfit, and they were all indefinitely postponed. Thus closed tlie most dangerous, uncertain and exciting fight in which the Nebraska grain trust was ever com]:)elled to engage in the defense of its unjust purposes and illegal interests. EXIT BEWSHEE, ENTEK MILLER 87 CHAPTER VIII EXIT I^EWSHEB, EifTER MILLER A sliort time after the adjournment of the 1903 session of the legislature, the secretary of the Nebraska Grain Dealers associatioij/sent out letters giving notice of the annual meet- ing, as follows: "Omaha, Nebraska, April 10, 1903. "Pursuant to the constitutional requirements, the annual meeting of this association will be held at the Xiindell hotel, Lincoln, Nebraska,' Wednesday and Thursday-^ April 22d and 23d, first meeting 2 p.m., Wednesday, April 22d. Perhaps never before in the history of this association were matters so vitally interesting for the grain trade up for consideration. This circular will not. permit a full explanation, but matters for your consideration are such as will re- quire in this instance at least a day and a half to dispose of them. In addition to the usual business transacted at our annual meeting, there will be re- ports mg^e you by the legislative committee, and one or two other special committees appointed, that you can learn of only by attending this meeting, as the subject matter is so voluminous as to preclude the possibility of its being distributed in pinnt. In no past year has the effort put forth in behalf of the dealers been so strong as ihat attempted during tlie past year. It is absoluteli^ necessary that every member be present, so that he may hear and read of tliese various committees, and devise ways and means for the completion of the work begTin by those committees. I therefore trust that every member will deem it his duty to attend this, meeting. 88 THE GRAIN TEUST EXPOSED Later I will write you again enclosing admission ticket. This advance notice is sent out so that you can arrange your affairs to be present with us. Ow- ing to other more important Avork, it was thought best to abandon the proposed excursion. Remember the date, April 22d and 23d, 1903, Lindell hotel, Lincoln, Nebraska. "Yours truly, "A. H. Bbw_sher, Secretary." This circular letter, worded as it was, and mailed to all members of the association, should be sufficient proof that something had been done, and that something more was going to be done. The association having been successful in defeating legiSr' lation to compel railroads to give elevator sites on demand, to farmer organizations, the next step necessary to be taken Avas to induce the railroad officials to consent to do in the future Avhat they had done in the past>^refuse those sites when they were demanded. This, hoAvever, promised to be not the easiest thing in th& world to accomplish, for about this time an ominous muttering could be heard by careful students of things political, who kept their ears close to the ground. For political and other reasons, the railroad officials had heretofore thought best, now and then, to grant a location for an independent elevator. Especially Avas this the case if, as not infrequently happened, there Avere some individuals in the organization a\ ieldlng political influences in the county. But Avhen the railroads did this it Avas,, of course, distasteful to the members of the trust But although a bitter pill, it could be swallowed if not too freqxiently administered, and especially if sugar coated by assistance given elscAvhere. Intelligent and obserAdng members of the tnist realized that the men at the head of the Nebraska railroads Avcre be- tween old Satan on the one hand and the deep sea on tlio other. Here at pome particular point Avould be au assoeia- EXIT iJEWSHER, ENTEU Ulhttk $9 tion of farmers clamoring for a site ujpon which to erect an elevator, and opi>osed to them were the managers of the line house elevators, insisting that the site should not be granted. The relations of the managers of the line houses aud of the railroad officials were very pleasant. They frequently dined together? in the besf cafes in the land, and over mutual en- joyment of the most toothsome'triumphs of the culinary art, agreed to be friends forever. As they sat and sent clouds of f*Fagrant Havana smoke toward the ceiling, they would naturally bring up the subject of these farmers' organizations, and whil^ these gentlemen thus sat together enjoying life and discussing their mutual inter(?sts, where were the farmers who were proposing to band themselves together to attend to the marketing of their own grain? They were home on their farms, ^with their wives and families, blissfully ignoraut of what was being said and done in the elegantly appointed cafe in Omaha or Lincoln. By and by the railroad oflicial, having a few thousand dollars idle, and being anxious to invest it safely and profit- ably, purchases 160 acres of Nebraska prairie. The elevator magnate, perhaps, buys another 160 acres in the same sec- tion. They have thef sod broken, and have the ground tilled, and raise grain to sell in the markets of the world, in com- petition Avith the farmers. The farmers utter no word of complaint against the railroad official tind the eleVator magnate, and place no obstacleJn their way. This being the case, has the railroad official and the elevator magnate any moral fight to deny to the farmer the same privileges to compete -vYit^ them that they insist oh arid demand for them- selves? With or without that right, however, we all of us know that there are men engaged in the grain business in this state, at the head of large corporations, who are so nar- row,, selfish, and greedy, that they will protest vociferously against allowing to others the same privileges that they de- mand for themselves. 90 THE GRAIN TBTTST EXPOSBD At the April meeting of the association, in consequence of the circulars sent out by Secretary Bewsher, there was a large crowd in attendance. Every memher present was more than pleased with the outcome of the- legislative fight, ajid was glad that the session had adjourned. Koutine matters were soon disposed of. The treasury, by the way, would have been all but depleted had all the expenses of the legislative com- mittee been paid from it. But some of the larger corpora- tions had made advances from time to time, with the under- standing that an assessment of a certain sum per elevator^ would be made at this annual meeting to reimburse them. The report of the chairman of the legislative committee was submitted and each and every action that had been taken was approved. An assessment of |5 per elevator was made to defray the expenses that had been incurred in defeating farmers' elevator legislation, and when the motion to this'- end was made there were no questions asked as to what had been the cause or nature of the expenses so incurred, as every- body was more or less familiar with the methods generally utilized to seduce the legislature from the hard and narrow path of justice and right doing. And here, for the benefit of some inquisitive persons, I might as well say that during the collecting and disbursing of tlie money at the disposal of the committee there were no checks given to any one. All bills were paid in the coin of the realm. No receipts were given, and none Avere taken. * All the members attending this meeting, while they were in good spirits, and felt encouraged over the outlook, realized that there was an abundance of Avork to be done, and that they must all stand together to hold up the hands' of their secretary, as well as of the other officers upon whom so much depended. More was expected of the secretary than of others, as he was a high priced man and devoted all of his time, energy, and intellect to the interests of the members. At this meeting the president, George Hayes, refused to stand for reelection, as he had occupied that office for a number EXIT BEWSHER, ENTER MILLER 91 of years. He yvak more than anxious that the toga of honor should be placed on the shoulders of some other member. The result was that Walter Holmquist was elected president, Mr. Hunter vice-;^resident, and T. D. Worrall, 0. A. McOloud and F. S. Cowgill, members of the governing committee. A few minutes before the meeting finally adjourned F. P. Lint moved that as the retiring president^ Mr: Hayes, had offi- ciated in tliat capacity for a number of years, and had done faithful and effective work, without tangible compensation, that the;gOveming committee be authorized and instructed tp purchase one hundred dollars' worth of cut gla^s or silver- ware and present it to Mr. Hayes. The motion was carried without oppositian. The governing committee knew about as much about cut glass and the selection thereof as a donkey does about the ten commandments. But each member nat- urally disliked to acknowledge his ignorance to the other members. Finally it was decided to allow Mrs. Oowgill to use her own judgment and make the selection. She was nat- urally anxious to assist her husband and help him out of this embarrassing position, while at the sanje time helping out the other members' of the committee as well. This lady did the duty assigned her, and did it well. The bill was paid by the secretary, and with it closed the chapter of the Nebraska Grain Dealers association making presents to retiring officers. At this meeting Mr. Bewsher gave notice that just as soon as his successor could be selected he would resign his posi- tion as secretary. This was looked upon by some as being a body blow to the organization. Others thought differently, as it must be confessed there were some very influential mem- bers of the aissociation who did not approve of all the methods resorted to by Mr. Bewsher to bring about success. It must be confessed further, however, that it is Sn undeniable fact that the aggressive and persistent worker in any association will find people hostile to him, no matter whether the meth- ods adopted are legitimate or contrariwise. That Mr. Bew- 92 THE OKAIN TRUST EXPOSED slier had made a success out of his work as secretary could not be denied by any one and was admitted by all, and there was a good large majority that disliked to hear the announce- ment that as soon as a successor could be selected he would hand in his resignation to accept a position with a big cor- poration. Mr. Bewsher sah'ed the wound administered the association,, however, with the announcement that he would devote all the time that might be necessary to instructing his successor in the mysteries of the crafty and that at all times and in all circumstances he would continue to do whatever he could for the upbuilding of the association. Whether he has succeeded in doing tliis since he relinquished his position as secretary as well as he did before I will leave to those that read this volume and to those that are members of the asso- ciation to judge. I venture the prediction, however, that the report will not be unanimous, but there will be a majority and minority report Mr. Bewsher stated that the time spent and the work done by him in the service of the Nebraska Grain Dealers asso- ciation had been thoroughly enjoyed, and that at a far distant time, when his shoulders should be bent beneath the weight of years, when his footsteps should be feeble, and his hair be white with the frosts of many winters, he would look back upon the days devoted to the upbuilding of the grain trust in this state, and to the friends and associations then formed as among the most delightfully pleasant of all the exp^- ences of this life. It was agreed at this meeting that the selection of Mr. Be-vy- sher's. successor should be left to the governing committee and the president of the association. This practically closed the official work of Secretarv Bewsher. In the remaining portion of tliis volume I shall make mention of him as an in- dividual, and when referring to the secretary Avill use the name of Horace G. Miller, for it was soon after this iteeting that the president and governing committee met at the head- quarters of the association and elected Mr. Jliller secretary. EXIT BEWSHEB, ENTBK MILLES 93 Of Mr. IMiller as secretary, and of the methods "he adopted to carry on his ujolawful \vork,-i will have considerable to say hereafter, but not in a personal sense. If Secretary Mil- ler and ex-Secretary Bewsher would only learn that in this commercial world there, are some things that you can do legitimately in competition with others, and others that yen can not do legitima-tely, they would stand in a better light. There are certain things that no man can afford to do. He must not become dishonest in honorable and legitimate com- petition. No man can afford to preserve his life or safety by the sacrifice of his friends. No man, should attempt to sell his friend's honor or reputation and leave him to be inno- cently blacke&ed before those he must do business with. Temptation befalls.the best of us, and at certain stages in life we are all of us in danger of falling, but' we should resist those Jremptations no matter how many dollars are in sight to those wTio yield. There are some things in this life that are worth more than money, and one of them is the right to -feel that you have always tried to do what was right and honest. Soon after this annual meeting the members of the govern- ing committee, together with the president, met at head- quarters to select Mr. Bewsher's successor. The names of the following candidates were presented : F. P. Lint, H. Q-- Miller, A. H. Merchant, now secretary of the Omaha Grain Exchange, and Thomas Smith; A motion was made and car- ried that three votes be required to elect. At the'beginning Mr. Holmquist and myselLvoted for Mr. Lint, Mr. McCloud for Mr. Smith, and Mr. Gowgill for Mr. Merchant. After a deadlock, lasting for several hours, H. G. Miller was elected secretary. There were two hundred and forty bal- lots taken, Mr. Gowgill voting all the time for Mr. Merchant, and dying in the ditch with him. Mr. Miller entered upon the discharge of his duties in a very short time. As soon as he had acquainted himself Avith his work he started in to patch and fix up grain troubles existing at several points in 94 THE GRAIN TEUST EXPOSED the State. Being a new man with an abundance of ambition and an inclination and desire to work, he went at it with a detennination to conquer wherever the skirmish was to be fought. He yas very successful and was able even to fix up ..some points Avhere Mr. Bewsher while secretary had failed._ When Mr. Miller was told this the natural result was that he was encouraged in liis work and took on still a little more energy, and did still more effective work for the upbuilding of the association. Mr. Miller was very anxious and solicitous to have the hearty support of the officers of the associationj^ and he got it. At the time Mr. Miller put his hand to the throttle there was more or less turmoil and friction at Havelock, in Lan- caster county. At this place there were two single house dealers, one on the Burlington and one on the Rock Island. The trouble had been caused by a Mr. Moran who owned and operated a meat market in Havelock, and who bought and shipped cattle to the South Omaha market. James Candy owned and operated an elevator on the Rock Island and bought and shipped grain to the different markets. He also began to buy and ship hogs and cattle to the South Omaha market. This had a tendency to heat the blood of Mr. Mo- ran, and he went to Prairie Home, near by, and in a small way got into the grain business, buying from the farmers and shoveling from their wagons directly into the cars. Frank Hendrickson and J. T. Evans eax'h owned and oper- ated an elevator at Prairie Home,, which town is also on the Rock Island. Neither of them liked the idea of Moran bump- ing into tlie grain business to compete with them. They soon arrived at the conclusion that James Candy was the power behind the throne with :Moran, and that he and Moran. had formulated a plan whereliy they were to become equal part- ners, share and share alike, in all the hogs, cattle and grain purchased at Prairie Home and at Havelock. Prices were boosted up considerably at Prairie Home^ with the result that they were also boosted at Havelock, Bethany, Walton Waverly, i)avey, Ceresco,. and a number, of other points. EXIT BEWSHEE, ENTER MILLEB 95 The story here was the old story over again. Let trouble once get started and prices be disturbed and away goes "Jinny" with the cart down the line, and God alone knows 'where she will stop unless some wise philanthropic individ- ual steps in in time to check her in her mad career. f And sure enough about 'ishis time Mr. Fowler of Frei^iont began to yell and brandish his arms and so did Levering of : the Central Granaries company at Lincoln. Knight of Wal- ;ton was bellowing so loud that he could be heard for miles and miles about the prices that were being paid for grain at iHavelock, which were affecting some seven or eight other stations. li.y The result of this "hollering" was, of course, that an in- 'vestigation -was instituted to find out who was to blama Candy said that Moran, the "tracker," was taking grain ^)ut of his territory, and that- he would not stand for that. Evans and Hendrickson claimed >that Candy was respon- sible for Moran being in the business, and that so long as he remained there it was out of the question to expect dealers at that and surrounding points to get into the same bed to- gether and lie perfectly quiet, Moran, they insisted, must go back to Haveloek and . stay there. To this Moran sten- toriously 'objected. By and by Moran sold Candy two or three cars of grain,' and Evans and Hendrickson were theii finally -convinced that these two buyers were in cahoots to- gether, and the battle went on more fiercely than before. And all this while the outside fellows were yelling and between yells were planning just how to put an end to the ^^ouble. Meetings were held in tlie offices of the "Nebraska Elevator company in Lincol'n to try and devise ways and means for checking this "ruinous competition." Evans in the meantime had gone to Haveloek to look up a location for a meat market so as to be able to compete with Moran in that business, and declared that when he got his /market running in good order he was going to buy hogs and cattle and ship to the South Omaha market. At the same 96 THE GEAlN TRUST EXPOSED time tile railroad officials were being solicited to step in and take a hand, but these points being located on the Eock Is- land, which road has always maintained a very independent position in such matters, the appeals to them did but little good. All the "big boys" kept after the secretary, and he in turn kept on working the grey matter in his head to get this difficulty settled amicably and in the interests of all, and by so doing prevent grain from going outside its own territory. The inexperienced reader would be surprised to know' how diligently each dealer watched the movement of grain from what was called his territory, and the traveling freight agent Avatched the dealer just as closely as the dealer watched the farmer. The dealer would lose if a carload of grain went from his territory between $25 and foO per car, while the railroad company would lose between f50 and $125, depend- ing of course upon the distance from market I remember once H. O. Barber at Hickman got over into the territory of the Omaha Elevator company at Princeton ; the manager of " the latter company set up such a howl that Llr. Barber sent his company a check for the profit rather than have a dis- turbance made. It was one of the unwritten laws of the association that a dealer must hot go over into and buy grain in another dealer's territory, as it was sure to disturb the peace and profitable harmony prevailing at all nearby points. With those engaged in the lumber business the same practice prevails. If a lumber dealer goes into another man's terri- tory and is caught at it he is generally compelled to cough up the profits. Many times James Candy came to the office of the Ne- braska Elevator company in Lincoln to see Mr. Miller and others and talk the matter over. He was al^^'ays profuse in his promises to "do the right thing," and for a few days he would ; and then it would be the same thing over again. It was often remarked that next to Firth, Havelock was the most obstreperous place in Nebraska. Evans's threat to put in the second meat market at Havelock was having its effect on Moran, FRANK S. COWGILL President of the Trans-Mississippi Grain company GEORGE S. HAYES President of the Nebraska Grain Dealers As- sociation in 1899, 1900, 1901, 1903 AUGUSTUS H. BEWSHER Secretary of the Omaha Elevator company, and Secretary of the Nebraska Grain Dealers Association in 1899, 1900, 1901, 1902. teSlT BEWsSEft, ENTeE MlLtEft S? And then all of a sudden a trick was turned which brought Candy to terms. Evans dropped into our^ office one day and said to me: ; "I wish you would go down to Havelock and look over the ground and say you contemplate erecting another elevator- at that place on account of there being so much disturbance. While there you can feel of Candy and find out if he would sell and how much money he wants for his plant, etc. I will be back in three or four days and then you can let me know what he says." The scheme was blocked out and left in the rough.. That evening after the business for the day was over, and the president of our company had gone to attend some social function, I sat down with others engaged in the grain busi- ness and put the finishing touches on the scheme. When we were through, at 11 :00 o'clock that night, this was what we had arranged to do : On the following morning to make application to the trav- eling freight agent for a location on which to erect a thjrd elevator at Havelock; instruct him. to send out at once to the local agent so he could draw a diagram of the trackage and vacant ground, sign it, and recommend that the loca- tion, be given, and return. The Rock Island road requires that its local agents sign all applications for elevator sites. This plan was carried out the very next day. The agent at Havelock told Mr.' Candy that the Nebraska Elevator com- pany was going to build another elevator there When this information came to Candy he began to sweat. I had de- termined, in the meantime, that I had gone far enough for a while, and to wait and see what would be the effect of this mova , In a few days Evans came back. I told him what had been done. He approved, and thought it a better plan than trying to buy Candy out. We fully intended trying to buy him out when the proper time came, but it was then too soon. If later a price could be agreed upon we were to buy his en- 7 98 THE GRAIN TRUST EXPOSED tire plant for Evans and so get Candy out of the game. If by chance he should positively refuse to sell we were to try to get him to maintain prices and be good. This was the primary object and had been" from tlie start. Now it was time to take the necessary steps. This was to go or send some one to Havelock to get the freight rate on stone, sand, lumber, building material and machinery from the local agent, knowing that he would tell Candy probably before the questioner got outside the corporate^ limits of Havelock. Secretary Miller, also J. B. Wright, president of the Nebraska Elevator company, were well in- formed as to what I was trying to do. W. E. IMorley, a trusted employe of our company, was called into the private office and the scheme was unveiled to him. Inasmuch as he was to be sent to Havelock on a very important mission, it was necessary that he be in possession of all the facts, so there Avould be no mistakes made. He was told what to say, how to say it, whether with emphasis or in a soft "don't care" kind of way. At the appointed time he went and be- fore he came away found Candy wanted to sell out if there was going to be a third elevator erected. -He came back after having made an appointment with C.uidy to come to our office to see and talk with the managing department about the sale of his elevator. Evans was communicated with and notified to come to our office at once, to hear and report what had been and was liable to be accomplished. Secretary Miller was also noti- fied to come and be apprised of the latest developments. For now there were some bright and sparkling rays of sunshine just peeping through the dark and angry clouds that had hovered over and around Havelock for so long, and it began to look as if there would be some show of getting this station lined up with the others. Evans came and the report was made. He was delighted that ]\Ioran had given up the fight at Prairie Home, gone back to the butcher's block and was, biding his time by chop- EXIT BEWSHEK, ENTER MILLER 99 ping out neck steals and selling sparer ibs to the industrious inhabitants .of Havelock. Evans had agTeed not to go into the butcher's business, and it looked as though Candy was jeally going to sell out in the meantime. Candy and his. I^mpetitor had lowered their prices, and for a few days there was a noticeable and gratifying increase in the profits at Havelock and at tributary stations. Mr. Miller was delighted with the situation, and was in- structed to go and see Mr. Candy and his competitor, Mr. Holland, and if he could do so to fix up the fight bet\veien them, but to say nothing about Candy's selling out or about the -proposed erection of the new elevator. By this time all farmers had been told about this third elevator, and its com- ing was expected and desired, as they tjiought it would make more competition in the grain business. In this, of course, /they were badly mistaken, for the erection of the third ele- vator would have throttled competition at Havelock, the same as it has in majiy other stations in Nebraska and Kansas. Secretary Miller went and visited with Mr. Candy, and came back encouraged. Hejeported that there was a good chance of getting Havelock fixed so it wquld be in line with other stations ; that Candy did not want to sell, neither did he want to see the third elevator bililt, and had asked Mr. Miller to see the Nebraska Elevator company people and do jwhat he could to persuade them to abandon that plan. Miller was sent back to say that when Candy and Holland got things fixed up right and put up their maney as a pledge that th^y would abide by and pay the prices fixed by the r trust, it would be ample time to talk about stopping the building of the new elevator at Havelock. . A few days later Mr. Candy came to our office. I received him in that same "don't care" kind of way that I have re^ ceived otliers under similar circumstances. As much as to say, "Say what you have got to and get out of here; this is my busy day." 100 THE GBAIN TRUST EXPOSED Mr. Candy said : "j^ou are going to build an elevator at my station?" I answei'ed : "Yes, we have made application for a sit^ have ordered the stone and sand, our builder is getting out the lumber bill." He said : "I will sell you mine if you want to. buy." "How much do you want for it?" "13,500." "Oh, no. That's too much money. We can build a better house than you have for less money than that." Evans had told me that if I could get the elevator for |2,500 he would take it, but not to go beyond this price,' so I was working under instructions and had to be careful and cautious about what I said. We talked together for some , time, and at every opportunity Ijput in a good word for the price cards and the price committee. We had reached no agreement when Candy left, except that he should call again within a very short time^ when we would each of us be prepared to make our best and final proposition. It was plain to be seen that he was rather inclined to come into the grain trust fold, and so be able to continue his business without danger of being frozen out I saw, however, that he was one of those men who act very slowly and deliberately, and that there was nothing to be gained by unduly hurrying matters. The next time Evans called at our office it was decided that when Secretary Miller came to Lincoln he should get Candy and Holland together and see if they could not be 'induced to sign a trust agreement, and put up tbeir forfeit money on condition that if they did so we would postpone' for one year the building of our elevator, and if at the end of that time the agreement had been scrupulously kept might finally abandon the project, although as to this latter we would make no binding promises. This seemed clever EXIT BEWSHER, ENTER MILLEE 101 :en.Ough maneiivering to Evans and to myself, as it did to the other officers of the Nebraska Elevator company. Person- ally I had worked myself up to such a state that it seemed to me that ^ort of business was perfectly legitimate. In the course of a week Secretary Miller appeared on the scene, and Wfeht directly to Havelock to see Candy and Hol- land. He brought them with him to the offices of the Ne- , .braska Elevator comp£iny and informed me, in their pres- ence, that they had agreed to put up a forfeit of flOO each to guarantee that they would maintain trust prices. He said that since they were willing to do this it seemed to him only right that we should defer at least the building of our ele- vator. After a little Sparring I told Mr. Candy that we had no desire to do him any injustice, and that if he would agree to 'abide by the card prices and "be good" we would not build for one year. Mr. Miller then drew up the follow- ing agreement, to abide by which they posted their forfeits of $100 each, placing them in my hands : ^"Lincoln, Nebraska, August 17, 1903. ' f "AGEEEMENT between JAMES CANDY AND HOLLAND BEOTHEES. "1st All wheat, corn, and oats shall be divided equally, each receiving 50 per cent. "2d. Eeceipts shall be passed from one to the other each week, and settlements shall be made weekly at the same time that the receipts are passed, "3d. Railroad shipments from each road shall be compared the first of each month and checked against receipts as given each to the other each week during the fiionth. "4th. Settlements shall be made on the basis of 2^ cents on com and oats, 4 cents on wheat, on the stuff in excess of either's share, in cash or by check. 102 THE GEAIN TRUST EXPOSED "5th. Contracted and in elevators now, which shall not be figured in settlement, is as follows: .Candy 1,200 bushels of wheat and 6,500 bushels of corn; Holland 2,700 bushels of wheat and 17,000 bushels of corn and 1,000 bushels of oats. "6th. This agreement shall not be terminated in case either party shall become dissatisfied, unless the thirty days' notice shall be given. "7th. The card prices shall be the basis of prices to farmers, except when meeting competition at sur- rounding towns, in which case we agree to work together. We will also confer with our surrounding town competitors and try and get them into line be- fore taliing any radical actions. "8th. As an evidence of good faith we hereby each- put up our check for |100, same to be placed with this agreement in the hands of T. D. Worrall, who shall also act as arbitrator in cases of dispute re- garding the interpretation of any and all clauses of this agTeemeut. "(Signed) "James Candy "Holland Beothees" Thus was closed a long, bitter and demoralizing contest. Secretary Miller, for his share in these negotiations, was heartily congratulated by a great many members of the as- sociation upon having succeeded in killing competition at a point where ex-Secretary Bewsher had several times made the attempt and each time failed. One reason why Miller had succeeded ^^'here Bewsher failed was that toward the end of the latter's administration many of the single house floalers began to believe that he was woilving more in the interest of the line house members than for the single house operators. As Secretary Miller was a man new to the work iind hud not taken sides with either class he did have at the EXIT beWshee, enter miller 103 outset more influence with the smaller dealers than Mr. Bewsher had. Miller, however, soon began to follow in the pathway of his predecessor, and to cater to the whims of the big operators and do their bidding. 104 THE GEAIK TllUST EXPOSED CHAPTER IX FOOLING THE FARMERS While this trouble at HaVelock was being fixed up, J. T. Evans was slashing around in hot water dowit at Murdock, another station on the Rock Island iroad, at which he owned and operated two elevators — all that there were at that point. A short while previous the Omaha Elevator com- pany had o-^^^led and operated two elevators at Shelby, and two at Yutan, on the Union Pacific. The farmers at these points had quite naturally concluded that there could be no competition at a station where one company owned and operated both elevators. On account of the growing agita- tion, and demands of the farmers for sites, the officials of the Union Pacific railroad had posted an order that no per- son, firm, company, or corporation should be permitted ta operate more than one elevator at any one station. In con- sequence of this, the Omaha Elevator company had sold an elevator at each point where they had been operating two. The knowledge of this fact had frightened Evans, who up to that time had been able to deceive the Rock IslandT ■railroad, as well as the farmers, as to his owning two eleva- tors at Murdock. Evans came to me and made a clean breast of the^ntire matter. He said if the railroad officials should learn the facts they would raise "Old Harry" withliim, and that he was not in a position at that time to be able to stand an exposure. One of his elevators at Murdock was run in the name of Wolfe & Toole, who belonged to the Nebraska Grain Deal- ers association, but it Avas Evans who paid their dues, fur- nished the money to run their business, and took their profits. He had not Avorried at all about whether they did FOOLING THE FARMERS 105 much business, or little, for whatever grain they failed to buy came^ of course, to the house that was run in his o^Yn name. Evans wa^ed us to lielp him, and I promised that I would consult with those associated with me, and let him " know what we could do for him. Just at this time the farmers at Murdock had positive" proof as to Evans owning both elevators, and had organized, ,and were demanding of tlie Kock Island company a loca- tion or a site on ^\'hich to erect an elevator of their own. The Grain Dealers association was bitterly opposed to the railroad acceding to this demand, as a farmer's elevator at Murdock would cause great disturbance in the grain busi- ness at Ashland, Greenwood, and Waverly on the Bur- lington; Wahash, Elm wood, and Manley on the Missouri Pacific, and South Bend, Murdock, and Alvo on the Rock Island. In addition, it would be very apt to encourage the erection of farmers' elevators at these and other points, to ,the great loss of members of the association operating in the eastern part of the state. It was recognized that the trouble at Murdock must be settled in such a way as to pre- vent the farmers from building, even though radical meas- ures might have to be resorted to. Farmers who were causing this trouble at Murdock were well to do, had already put up considerable money, and it was plain that they meant business. They would not sub- mit to having to sell their grain at a station whete one ma^ had a lead pipe cinch on them through owning both eleva- tors. They had made efforts to escape the hold-up, by shipping their own grain, but had been unable to get the cars. Whenever they ordered cars they were informed that ears were scarce, and found them hard to get. I took this matter up with J. B. "Wright, the president of our company, and we discussed the situation at length, analyzing it carefully, and weighing the possibilities. He said: 106 THE GKAIN TKUST EXPOSED , "It would be an easy matter to shift one of the Evans' elevators to some other friendly party, but I am afraid its going to be a hard job to stop those farmers from building. If you can do it in any way, you have my permission. It ought to be done. The erection of a farmer's elevator at Sfurdocb will encourage the farmers to build at other points, including, very likely, some of our best places. How do you expect to proceed?" "I haven't got that far yet," I answered, "but will outline a plan of campaign to-night, and will submit it to you to- morrow. Stop in in the morning, on your way to the bank, and I will have the plan blocked out in the rough. I want your assistance in putting on the finishing touches." "All right," he said, "I will do that. Good-bye," and out he went. Before 9 o'clock the next morning I had my scheme per- fected, and this is what I did : I wrote Wolfe & Toole, say- ing I understood their elevator at Murdock was for sale, and asking their price, and when they would be able to give pos- session. I had Evans post them regarding the price; the consideration for the bogTis sale A\as to be |3,T50. They Avere instructed to answer in four or five days, not being in too much of a hurry, as we had to play the game carefully, so as not to arouse the suspicion of the farmers. In a week I had a letter offering the entire plant for $4,000. Evans meanwhile had told thom to quietly let the farmers know that they were fig-uring with the Nebraska Elevator com- pany to sell out> as they were tired of the business. I then wrote tlie second letter to Wolfe & Toole asking all manner of questions concerning the number o"f bins, the capacity, the make of the gasoline engines, the amount of gasoline used per car, the number -of cars shipped in the last year, whether there was an agreement at Murdock to maintain prices, divide grain, etc. In three or four days I received a very satisfactory an- swer. The next moFe was for me to go to Murdock aoid look fOOLli^G THfi t'AllMEltS 10? Oter the plant. Eyans was to be out of town while I was there. I was to be shown all manner of courtesies, but was to be steered clear of any one who might possibly say a word to me about the attitude of the farmers and their organiza- tions. Ypu see it was to be made to appear that I^was buy- Jng this elevator without having any, knowledge whatever of tlie trouble at Murdock. The scheme worked to perfection. I began to haggle with Wolfe & Toole about the price. I insisted they held their property too high, and declared I could not come to their terms. They refused to reduce their figures any, of course, jEiccprding to instructions, and we were unable to rearh an agreement. When I went away nothing was accomplished, except that they had promised to write me in three or four days. The result of this maneuvering was that the word went all over the surrounding (j^untry that negotiations were pending for a sale . of the elevator to the Nebraska Elevator company. I wired Evans to come to Lincoln, and he came, delighted with the progress that had been made. He was instructed' to hay^*Wolfe & Toole reduce their price to 13,900. We would then offer |3,50Ci. This would cause delay. The haggling would continue until it ended with aji agreement at f3,750, the amount previously agreed upon. After about ten days' further delay, the agreement was reached, and the word was given out that the eleyator had been sold to the Nebraska Elevator company. After another delay of two weeks to allow Wolfe & Toole to get all their grain -cleaned up and shipped out, I made another trip to ]\furdock to see the man who had been running their busi- iiess, and to engage him to work for us. This time while in Murdock I met some of the farmers and learnecL-from them something about the dissatisfaction among the farmers and their organization for the building of a new elevator. This, of course, was a great surprise^ to me. I put up a stiff talk about being tempted to back out on the deal, and let it be jijtjiought that I would have done so had I not been in honor 108 tHB GRAIN TEUST EXPOSED bound to carry it through. At the proper time a bill of sale was made, transferring the elevator from Wolfe & Toole to the Nebraska Elevator company. For this property the Nebraska Elevator company gave Wolfe & Toole a check for $3,750. They endorsed the check over to J. T. Evans, and by Evans, on the same day, it was handed back to the Nebraska Elevator company. The next day Evans came to our ofQce, and agreed with Mr. Wright and myself to furnish the money to run that elevator, and to pay us |50 per month as our compensation for running the business. He gave us his check for $1,000, and we began operations. For a while business was rather quiet. There were a few individuals who had no love for Mr. Evans, and who eould not be made to believe that the sale was a bona fide transac- tion. They influenced* other farmers, and so there were quite a number who were convinced that Evans stUl owned both elevators. To disabuse the ^ minds of these doubting Thomases was one of the tricks of the trade not so very difficult of accomplishment. The farmers in the vicinity of Murdock had entered into an agreement, which forty-six of them had signed, not to sell or haul any grain for any one to either of the elevators at Murdock, until the railroad company should give them a site on which to erect an elevator of tlieir own. This agreement was iron-clad and water-tight. Evans and the Nebraska Elevator company could see no way of defeasing it except through the practice of a piece of deception. But by this time we had all become case-h^dened and considered it legiti- mate to stretch the truth, providing no great and serious harm was done to any one. We reasoned that these farmers were in comfortable circumstances, had good homes, good barns, drove good horses, had their carriages and buggies, had pianos and organs in their houses, and that it was wicked and unjust for them to want to start a grain business of their own, and so deprive Railsback Brothers, the Nye- Pooling the faemses 109 Sehneider-Fowler company, tlie Duff Grain company, tire Central Granaries company, the Nebraslca Elevator com- pany, and others, from making a handsome profit off of what thgy had to sell. Consequently it was with no twinges of - conscience that we decided to fool those farmers. Secretary Miller was requested to call a meeting of the in- terested parties, to be held at once, in the office of the Ne- braska Elevator company. Those asked to attend were J. T. Evans, Frank Hendrickson of Prairie Home, Curea and Son of Alvo, Joe Tighe of Wabash, D. Smith of Elmwood, John Tighe of Manley, J. G. Railsp>Vick of Ashland, Dufl£ Grain company of Nebraska City and Central Granaries com- pany of Lincoln. All of them responded. Oijr scheme was placed before them. We argued that inasmuch as the farmers around Murdock had combined, and agreed neith^ to sell Oior deliver any grain to this station, we were justified in doing almost anything to beat them. I declared that I had a scheme that if all hands would join and help to execute it, would do the business in a short time. / The meeting clamored for that scheme, and I outlined it in about this way : "If you gentlemen who are in the grain business at sur-' rounding points will allow the dealers at Murdock to offer and pay a half cent a bushel more for grain than you do, we will hav»-#iis farmers' combination shot full of holes in less than thirty days." Every dealer agreed to this proposition. - Each one de- clared he would stand pat and allow our agents at Murdock to offer a half cent more than they did. We began work. Our farmers were going to Wabash, Greenwood, and Ashland, to inquire as to the prices p,aid -for grain. At Murdock our agents were actively spreading the news as to the price we would pay. Our price was a half cent better than anybody ^se's price. Farmers belonging to the combination began to be uneasy, as they had a great deal of grain to market The corn crop was about matured, 110 TSB GRAIN TRUST EXPOSED and they must soon dispose of what old corn they had oil hand, in order to make room for the new. They were sopn coming or sending to inquire as to our prices. Evans com- menced to get nervous, and buyers at surrounding stations were growing alarmed, fearing these fanners would let their grain spoil before they would sell to us. The farmers began to come in with their inquiries more and more frequently, and each time they found that our prices were still a half cent higher than what was offered at other places. The merchants at Murdock began to advertise their grain prices, and the agent of the railroad was loud in his praises of the prices we were offering. Suddenly the break came. One day one of the farmers who had signed the agreement came in and sold 2,000 bushels of corn at Murdock. That was a starter, and within a short time we had delivered to us and contracted for delivery, something like 60,000 bushels. Evans had done about as well. The farmers' combination was broken. As soon as this was accomplished, prices at IMurdock dropped down, to the same figures that prevailed at other places. The grain trust was jubilant over the manner in which this battle bad been fought, and the victory won. Everybody was patting me on the back, and I had more complimentary things said about me then by men engaged in the grain business than they would think of saying now. In a little while O. H. Eggieston dropped into Murdock, and made a legitimate purchase of tliis elevator, which he still owns and operates. In a short time we made a clean-up, paid"Mr. Evans back his |1,000, in addition to |800 profit. On top of this we had paid all expeiises, and had earned our own |50 per month for the four months that we had charge of the elevator. This closed the chapter at Murdock, and Mr. Miller, the new secretary, was happy. During the falljof 1903, I attended district meetings at a great many different places, in the South PLitte country. The passing of the Ramsey bill, although it was defective FOOLING THE FARMERS 111 bad been the means of encouraging and stimulating tlie farmers, and they were organizing at numerous, places. Meetings of our organization were held in Omaha, either in the offices of the Omaha Elevator company, or in the secre- tary's office, to devise-ways and means Avherewith to combat these farmers' organizations. Among those generally at- tending these meetingsi were Secretary Miller, Edward P. Peck, P. S. Cowgill, E. S. Westbrook, N. B. Updike, Floyd J. Campbell, F. S. Levering, A. H. Bewsher, Frank Fowler, Christopher Crowell, Jr., George H. Hayes, T. D. Worrall, J. S. Ewart, and others. Hereafter, in referring to the management of the Omaha Elevator -company, I will have in mind Bdwayd Porter Peck, since A. B. Jaquith" severed his relations with that company July 1, 1903, and Mr. Peck became the active manager. I have said many times that when IMr. Jaquith stepped down and out the Nebraska Grain Deal&rs association lost the best, most ar- dent and. enthusiastic. worker it ever had. Mr. Jaquith is a man who is true to his convictions, who will go as far as any one I ever knew to do a good turn for a friend, or to punish an enemy. The rough side of his nature is always the outside. His word in all matters, no matter whetl^er the amount in- volved is f5 or |5,000, is just as good as his check, and his checks have always been good for the amount called for. He "was a pioneer in the grain business in Nebraska. Whether his works at all times shquld Jbe approved or not is something that I must leave to the readers to judgje. 112 THE GRAIN TRUST EXPOSED CHAPTER X THE FIRST CLOUDS APPEAR I have now reached that stage in this plain and un-var- nished tale where i^ becomes my pleasant privilege to tell the story of the beginning of the end of the arrogant man- ner in which the grain trust was conducting the grain busi- ness of the state of Nebraska.^ It was a dark and ominous day for the grain trust when the Great- Western railroad extended its line into Omaha. A few years before, when the Illinois Central built into Omaha, many people, even tliose living in Omaha, did not know of the fact before the road was in operation. Not so _with the "Maple Leaf route. Before it had the grading completed into Council Bluffs, everybody knew it was .headed for Omaha, and the people were ready to receive it. Mr. A. B. Stickney, president of this railroad, had no sooner set foot in Omaha than he began to astonish the most enta'prising and wide-awa]£e business men in the city by his statements concerning the opportunities that were lost on account of there being no action taken to establish a cash grain market in Omaha. Other cities located on the "Big Muddy," he pointed out, had established grain mar- kets. Why could not Omaha establish one? The news- papers took the question up and agitated it, and interest grew apace. The little flame that President Stickney had kindled was spreading into a vast conflagTation, before which the Nebraska Grain Dealers association stood aghast. The vital question with the grain trust was how to pre- vent the establishnient of a gTain market in Omaha. I know, personally, and state positively, that there was not a line house dealer in the state of Nebraska who wanted a cash grain market established in Nebraska. The business man THE FIRST CLOUDS APPEAE * 113 who is not interested in the buying and selling of grain knows little about the grain business which has been handled by pools and combinations, both in the country and at tlie terminal end. For four years, to my personal knowledge, previous to the opening of the Omaha Grain Exchange, the Omaha Elevator company and the Trans-Mississippi Grain company were the only two companies that bid reg-ularly on grain shipped to Omaha over the Union Pacific railroad, in carload lots. Now and then some outsider would dip in and make bids for a day or two, and quit. Then some one would bid that no one knew or had ever heard of, and would have so many strings tied so tightly to his bid that no one would ever sell to him. These were what were called "dummy bids," sent put to fool the dealers, and make them believe that the two companies above mentioned were offering to pay them more for their grain than any one else would pay, when the facts were that whenever any outsider wanted to make a bona fide bid on Union Pacific grain, a job of some kind was Sxed up to prevent him from doing so. For years and years these two companies had had a lead' pip^ cinch on grain raised in Union Pacific tenitoryv The road allowed them a good terminal charge and other concessions.^ Is it any wonder, then, that the Omaha Elevator company, which began business in 1890 with nothing, not a dollar, borrowed $1,200 to pay for drawing up and filing their articles of incorporation, and to pay for the issuing and recording of their bonds, has paid a million dollars in dividends, and has, according to Mr. Peck, seventy-five elevators worth two millions or more, of dollars, a terminal house in Council Bluffs that cost $250,000, and has been able to pay large salaries and keep up an expensive establishment for all these years? It has been able to do this, because of pools and' combinations at both ends of the line, and what the Omaha Elevator company has done on the Union Pacific is but an illustration of what other grain companies have done on tJiat and on other roads. 114 THE GRAIN TRUST EXPOSED Naturally therefore, when Mr. Stickney came to Omaha and began talking about establishing a cash grain market there that would compel competition, it was this, that by all means,_the grain trust was anxious to preveiit. What I have here to tell will not be enjoyed by the man- agers of the line houses, but T intend to hew to the line, let- ting the chips fall where they may. I am in possession of the facts, and I am going to make a clean breast of them, and tell the truth, if God lets me live long enough to tell it. Soon after the agitation for the establishment of a grain market at Omaha had been begun. Secretary Miller came to Lincoln to see me. He was considerably agitated, and said this trouble was going to make a great deal of addi- tional work for him. There was much agitation among the farmers in Nebraska, and they were erecting elev-ators in different parts of the state. If a grain market was opened at Omaha it would mean that they would find a place to dispose of their grain, and he could see nothing but trouble ahead for the grain men in Nebraska. He said the dealers in Omaha wete placed in a very embarrassing position, and would be compelled to take out memberships and join the grain exchange on account of the great pressure. The business men and others in Omaha would think it strange if those engaged in the grain business should refuse to take a •hold and do everything in their power to help make the Grain Exchange a success. It is worthy of note, right here, before I forget it, that none of the big line elevator operators in Nebraska outside of Omaha, with tlie exception of Louis Spelts of David City, and W. H. Ferguson of Lincoln, are members of the Omaha Grain Exchange to-day. There is the Nye-Schneider-Eowler company, the Nebraska Elevator company, the Central Granaries company, the Ewart-Wilkinson company, the Hayes-Eames Elevator com]jany, the Jaques Grain company, the Crowell Lumber and Grain company, the Wells-Hord Grain company, and others, all of which were solicited tg ISE FIRST CLOtOS APPEAB 113 join the Exchange, but no member of any one of which has eyer taken out a membership. Tliere is no question that their membership would be of g-reat benefit to this cash mar- ket, and so would be beneficial to the farmers and producers of/grain in Nebraska. But what Vould help the Omaha Grain .Exchange and the Nebraska farmers 'would injure the Nebraska Grain Dealers association and its members. ' Some of my readers may ask a clear explanation as to why the grain trust was opposed to the establishment oi the Ofiiaha Grain Exchange, and I can best give it to them in the words of Mr. Edward Porter Peck. Talking over this question with me, before the market at Omaha "had been opened, Mr. Peck said: "We line house operators would be much better off if there were no cash market west of Chicago, for the further the farmer is from the market the less he knows of the true value of the grain he^is to sell, and the less he knows about that; the bigger the margin that can be obtained by the grain dealer." A great deal of time was spent by members of the associa- tion discussing this proposed grain market. Some thought it was only a ripple" on the ocean, while others could see danger ahead. All thought, however, that in the event a market were established in Omaha, the margins of the dealer at the country station would, be reduced materially. Re- markable as it may seem, right at the time that the proposed establishment of this grain market in Omaha was threaten- ing the Nebraska . grain trust, its members were putting down the scre\fs harder and harder on the farmers, and were growing bolder and bolder in the methods employed to stifle competition. About the time new corn was ready to be marketed, a meeting was called by the secretary for 8 p.m.- For some reason or other, by the way, the most of these grain trust meetings were held after dark. Why that was I never could, and-do not to this day, understand, At this meeting was present, among others, E. P. Peck, 116 THE GEAIN TRUST EXPOSED A. H. Bewsher, P. S. Cowgill, E. S. Westbrook, T. D. Wor- rall, Frank Levering, N. B. Updike, Christopher Orowell, Jr., G. J. Railsback, Frank Fowler, J. H. Hamilton, James Bell, Louis Spelts, H. O. Barber, J. S. Ewart, George H. Hayes, ^ Milo Fames, and Secretary Miller. The secretary read some correspondence he had been having with the Kemper Grain ^ company at Kansas City. This firm was showing entirely^ too much independence, and would not confine its busi- ness to buying grain of what the association termed "regu- lar" dealers. This independence was not relished by Mr. Miller, or by members of the association. Miller was in- structed bo go in person and see the members of this con- cern, and try and fix matters up, and induce them to stop accepting shipments from the farmers' organizations. Many were in favor of sending out bulletins to all members of the trust, notifying them that this Kansas City firm was hand- ling shipments from the farmer elevator company at Ajxtell, • Nebraska, but some of the more conservative members thought it better to go slow, and have Secretary Miller go to Kansas City and have a talk with the management, and try and get them to stop handling business from "irregular" dealers. Mr. Miller was to show them what an awful mis- take they were making, and members of the trust were to indicate to the farmer that if they continued accepting grain from the farmer elevators, it could no longer expect any business from "regular" dealers. Other firms were also to be labored with. The Hungarian Milling company of Denver, the Percell Grain company, the W. T. Redman Grain company, and the Southern Grain com- pany of Kansas City, and the H. H. Carr Commission com- pany of Chicago, had all been guilty of accepting grain from "irregulars," and they were all to be labored with, and threat' ened with the loss of business if they did not desist, and I can say truthfully that all the -members of the trust were loyaJ, and brought to bear on tliese dealers all the pressure they were instructed to exert. I THE rrasT OLOTJDS APPEAB 117 The next district meeting was held at Eairbury, Nebraska, early in December. Shortly .before it met, Mr. Miller came to see me. He said that dealers down in the counties bor- dering on Kansas were not strictly abiding by the card prices, and that he was receiving many complaints in con- - sequence. For this reason he had called the Pairbury meet^ ing, and insisted that I go with him to Fairbury and help him get things lined up in better shape. He told me that at i)aykin, in Jefferson county, the farmers were agitating the organization of an independent elevator company and that tHe fp-mers' protective association had an elevator at Alex- andria, only a short distance from there, their competitor being J. H. Gregg of St. Joe. Gregg was "warining them up" in good shap'e, but this warming process was the founda- tion for dissatisfaction at Daykin, and if the farmers got es- tablished there, and at a few other places, the entire section would be spoiled. Miller said he had been to see the farmers' manager at Alexandria, and he had said he would be good if Gregg would, and Gregg had proraised to attend the Faii'- bury meeting. At first I refused to go. I said: "Miller, the harder we work to keep things worked up, the more Ivork it brings each one of us. I haven't gotten over the legislative fight- of last winter. The agitation on the part of these farmers has not waned a particle. If any- thing, I believe they are more determined now than they were at that time. Where is this going to end, and how? That's the important question with ffie. I am beginning to feel that about the' best thing we-^an do is to 'let her go Gallagher,' and every fellow rely upon his own intellect, judgment, and^abilit^j, then the fellow that works the hard- est apid uses the best judgment will get the cream, and the other fellow the skimmed milli." "Why," he said, "I am surprised to hear you talk as you do. It you keep tliis up you may- lead me to think that you are seriously considering severing your relations with thiis 118 IHB GHAIN TKUSl EXPOSED company and this association, aad joining with Butler, Vin- cent, Hoffjnan, and others." "That's the way I feel sometimes, and you may place your own construction on it It's fix up fights, scraps, and schemes all the tima I- hardly know what my home looks like. I am not there enough and long enough at a time to get a chance to look it over." "Well," he' said, "this is ratlier discouraging to the secre- tary, and a new man at that. I have a notion to resign and quit, and if a few more of the^ stalwarts talk to me as you have, I will do so." "I can not help it," I said, "that's the way I feel." -Just then J. B. Wright, president of our company, came into the room, and Mr. Miller, addressing him, said: "I want Tom to go with me to Fairhury, to attend a meet- ing I have called there, and he says he won't go ; that he is getting tired attending "so many meetings. The com crop has just begun to move, and you are anxious to handle it and get a good big margin, and make some money, are you not, Mr. Wright?" "Yes, oh yes, we want the money," said Mr. Wright, and turning to me, -"why don't you want to go?" I gave, him the same reasons that I had given Mr. Miller. He said hruskly: "Nonsense! Once let our combinations and pools be broken and each man make his own price, and you can no more than pay operating expenses, to say nothing about de- claring dividends on our stoclf. I am surprised to hear you talk this way!" I looked straight across the table at Mr. Wright, looking him square in the eye, and said : "Go yourself if it is necessary for your company to lo represented. I have heard you say that you have been in the grain business twenty-nine years actively, and that's much longer than I have. You ought to know more about this business than I do." THE FIRST CLOUDS APPEAR 1 19 i'Why I can not go. You can accomplish more in one hour than I AvoultHn a whole day. You have the reputation of being the best fixer in the organization. Won't you go Tom?" "Yes," I said, "I'll go." "Good," said Miller. "I want you there." "JMiller," asked Mr. Wright, "what is going to be the end , of this farmers' movement. They are beginning to get nerv- ous, and are doing a lot of talk at several of our stations, and if they build it will reduce the value of our property about one:half. We must keep on the good side o"f the railroad company, and get it to deny them sites, and by so doing keep tliem out. Did you ever see such a lot of damn fools as these farmers are?- They ain't satisfied when they are doing well. They are raising good crops, prices are good, and they ought to be contented." I thought then, and have since asked myself the question : "Has not the farmer as much right to make an honest effort to better his condition as has the person who holds one stiare of stock in a corporation that was capitalized Jor |88,000, -paid up, and drew his salary every month from the grain company he was associated with, as well as a salary for be- ing president of a bank at the same tinje, and giving nothing, in return for either?" Miller said: "Did you see that article in Sunday's daily; ? Tt's a splendid article. It shows up this cooperative busi- ness among the farmers, and ruBs it into Vincent and But- ler. A copy of that paper ought to be in the hands of every agent you have." "Get'fifty copies," said Mr. Wright, turning to me, "and send two copies to each of our agents." I did so.. The next day following this conversation, I attended the Fairbury meeting, which was held in Secretary Miller's room at the hotel. There were present, besides ourselves.' 120 THE GRAIN TEUST EXPOSED R. Wilkinson, Ben McLucas, D. C. Houk, representing the J. Kosenbaum Grain company of Kansas City, Frank Lever- ing, J. U. Gregg, Ed\yar(l Leet, W. P. Dickenson, A. H. Phelps, T. J. Ulricli, William Germer, and Charles Germer. Neither William Germer, wlio ran an elevator at Jensen, nor Cliarles Germer, who ran one at Plymouth, were members of the association, and. they were among \hose taken in hand at this meeting. They had shown considerable independence in running their business, and had caused not a" little trouble to line houses at surraunding points. Fortunately for thenf, there were no line houses at the stations at wMch they operated. Had there been, the Germer ball of yam would have been wound up so tightly that neither of them could ever have untangled themselves, .and both would have long ago been driven out of business, or brought into the fold, but their competitors were weak and were not able to piit up the kind of fight that would have been made by a line house. Another of those present who had made trouble was J. H. Gregg of Alexandria. He had shown a disposition to buy as much 'as he could, and to pay what he pleased, regardless of card prices. He was taken in hand by Secretary Miller, and other members, who explained to him how ruinous to the grain trade was this policy of his, and who insisted that he get into line and stay there. Gregg, said he was willing . to "be good" provided the farmei^s' elevator at Alexandria would follow the same course. It was arranged tliat Secrei- tary Miller should see the farmers' manager, and try and fix things up with him. Whether he eventually succeeded or not I do not know, as other matters of greater moment came up a little later to occupy my time. Still another point that needed attention was Daykin, M'hore the farmers had held several meetings to agitate the erection of an independent elevator. It was decided to bring strong pressure to bear on the railroad company against the granting of a site, and that in the meantime the local cleva- tHB FIRST OLOtrbS APPBAft 1^1 ioi" men should try moral suasion and other means to per- suade the farmers that the member^ of their combination were barely paying runninig exi)enses, and that the starting of another elevator would mean ruin for all of them. These tactics proved effective, with the result that the farmers quieted down and continued paying tribute to the octopus. Along about this time 'there was a lot of trouble at Supe- rior, where things had gone to smash, and open warfare was being waged among the dealers — Bossemyer Brothers on the Atehison, Topeka & Santa Fe road, W. J. Elliott on the Burlington, and the Nye-Schneider-Powler company on the North-Western. It looked for a time- as though the trouble between them was going to disturb the prices at all grain stations within a radius of 100 miles. The war was fierce and bitter, and the railroad companies were involved. Right here^ I want to digxess long enough to remark that whenever Frank Fowler, the secretary and active manager of the Nye-Schneider-Fowler company, goes into a fight, he loses sight of everybody and everything except the vic- tory at the end, but he fights fair, and that's, more^ than can be said of some otlier line house managers. He asks no van- tage ground, and the other fellow must not expect any of him. If he can be caught napping, and is punished, he bears his punishment with fortitude and lays for an opportunity to retalia-te. z So threatening was this trouble at Superior that it was decided to hold an interstate meeting of grain dealers from Kansas and Nebraska at that point. The meeting was called by E. J. Smiley, secretary of the Kansas Grain Deal- ers association, and Horace G. Miller, secretary of the Ne- braska Grain Dealers association. It was thought that if all the dealers interested along the borders of the two states could be brought together, a truce might be patched up and. peaee secured. The meeting was held and was largely at- tended. Bossemyer Breathers and Mr. Fowler were found to be ugly tempered and exceedingly obstinate. Both sides 122 ' THE GKAIN TRUST EXPOSED defiantly declared they were ready to continue paying as much for grain on the streets of Superior as it was worth in Kansas City. Mr. Elliott said very little, as he was between -the upper and lower millstones £^nd liable to be ground to dust if the war was not soon ended. His competitors were, of course, financially strong, and could stand the strain made on their bank account as long as they wanted to keep up the fight. Secretary Smiley made an appeal that was pathetic,' im- ploring the dealers on the Nebraska side of the line to settle their difflculties so that the dealers located in his state could' make money enough to keep the ravenous wolves from the front and back doors of their humble dwellings. It was a smooth talk, and sounded good. Secretary IMiller followed, in behalf of the Nebraska dealers. He said they were banded together to fight the ]?armers Cooperative Shipping associa- tion, together wiQi Hoffman and Butler, who had their earthly habitation in the Sunflower state, and that the Ne- braska dealers were hopeful that matters could be adjusted and settled so that everybody could leave the meeting feel- ing that it had been good to be present and assist in bring- ing about peace. To this all said Amen, and some other little talks were made along the same general lines. It was then up to Mr. Fowler and to Mr.. Bossemyer, and they responded nobly. Each in turn promised to "be good." There followed a love feast of hand-shaking and shoulder- clapping, and all around congratulations, lasting for prob- ably five minutes, and everybody was happy. Mr. Smiley then favored the meeting with a short talk in which he told movingly of how he had been abused and villified by the officers of some high grass town in Eush county, Kansas. Jle said he had gone there in tlie pursuance of his duty as secretary of the Kansas Grain Dealers association and had there found some of the brethren in the grain business actually competing with each other. Of course he told them that this was wrong, and that they ought to be ashamed of THE FIRST CLOUDS APPEAR 123 themselves for biddiug against one another, and suggested, as a means of insuring that they would stop that, for each to put up a forfeit of |100 to maintain prices aud divide grain. This had been agreed to, and the money had been given him to hold. And merely because of this, said Mr. i4miley, he had been arrested and threatened with imprison- ment, and was even then out on bail. It seemed to Mr. Smiley that he had -been greatly wronged, as it did to those present at this meeting, who all sympathized with him, and hoped that the case against him would be dismissed, so that he might go to some other place and do the same thing. 124 THE GEAIN XEUST EXPOSED CHAPTEJ^ XI WORIilED BY THE OMAHA GRAIN EXCHANGE The next important meeting I attended was held in the secretary's office in Omaha. It was called for the purpose of adjusting diHerences over the number of pounds which would be taken for a bushel of ear com, and how much of a discount should be paid for ear corn as compared with shelled. This was a large meeting, unusually so, as the mat tears to be considered were of vital interest to the members of the association. Word had been given out that the new Omaha"' Grain Exchange would probably open by January 1, 1904. It was definitely settled that the experiment was to be tried, and those engaged in the grain trade at the country stations were all more or less nervous, as they could already begin to see their big juicy profits dwindling away. As nearly as I can recollect those present at this meeting were N. B. Updike, F. S. Cowgill, E. S. Westbrook, Floyd J. Campbell, J. H. Hamilton, Frank Levering, A. H. Bewsher, Frank Fowler, G. J. Eailsback, J. S. Ewart, T. D. WoiTall, James Bell, E. A. Cope, H. A. Babcock, John J. Trompen, S. J. Brown, E. P. Peck, and Horace G. Miller. The first differences to come before the meeting w;ere those arising out of the number of pounds of ear com to be ac- cepted for a bushel. Speculative buyers at different places were buying on the basis of seventy pounds to a bushel, while line house dealers were taking seventy-five and in some instances eighty pounds for a bushel. " This, of cours^ had caused much friction, and was a difficulty that demanded immediate settlement It was decided that the price commit- tee be authorized to send out word next day instmcting all dealers hereafter to figure seventy pounds of ear corn as a bushel. ■ This question having been settled, the opening of the Omaha Grain Exchange ^^•as next considered. The Omaha WORKIED BY THE OJIAH^. GRAIN EXCHANGE 125 members did most of the talking, as they were on the ground and^were more familiar with what was going on. The first talk of importance was made by Edward Porter Peck. He said : *^ , "The Omaha !^aid Exchange is going to be launched, and there is no way to prevent it. When Psesident Stickney sprung this idea on the people of Omaha, it spread like wild fire ip a dry stubble field, and has continued to spread until almost every man in Omaha is. ablaze with enthusiasm. With the money, brains, and general interest that's back of this movement, you might just as well talk about stopping a cyclone as to stop this. The men behind this grain market project have the best interests of Omaha at heart., As a matter of fact we all know that while this grain market will be of benefit to Omaha and Nebraska, it will work an injury to grain dealers operating elevators out in the, state." "Why?" asked James, a member who was seeking light. / ''Because there will be at least two or three cars of grain on the market every day. These cars will be bought and sold. - The papers will quote these cash sale prices, which will represent actual worth and value. Elevator property from 100 to 150 miles west of Kansas City is worth only about half Miat elevator property is worth located the same distance from Omaha. The reason is that they do not get nearly as good margins in Kansas as we do here in Nebraska. The farmers w^ou't stand for it^ as each farmer knows what the freight rate is from his station to Kansas City, and if you get 2 ceiits profit on wheat and 1 cent on corn and oats down there you are doing mighty well. It will be the same way with us up here. Once this market is established our profits will be materially reduced. We had just as well be- gin now to get ready for it. We might as well be honest with jourselves and not attempt to maintain our structure on false foundations, for if we do, it is only a question of a short time until the structure will fall. Those of us who have our -offices in Omaha will be compelled to take out mem- i^SB THE GRAIN TEUST EXPOSED berships in this grain exchange. You who do not live in Omaha know nothing about the pressure that is brought to bear on us, and we have got to join. However, I believe it will be a good thing for the association, as the Omaha contin- gent will be 'next,' and can keep you outside fellows posted. \V\wu the exchange is opened there will naturally be ship- ments from 'irregnilar' dealers and farmers seeking an outlet through this market. Only a short time ago E. Beal came in with two samples of wheat and wanted to sell these cars- to our firm. We made a deal with him, and when he brought the bills of lading over I noticed they ^vere from this farm- ers' elevator organization at Benedict. I told hira-I would take the cars, but hereafter would not think of buying any grain from him unless it came from 'regtilar' dealers.. I merely mention this to show hoAv easy it is for these 'irregu-^ lar' shippers to creep in. You all know me and know I M'ould not dream of accepting shipments of this kind knowingly. But we all know that 'irregular' shipments are coming, and every member must be on the alert and Avatch for them, "^^'hen he discovers them he must report to the secretary, and he, in turn, must notify all the members of the associa- tion, so they can get after the firm accepting the 'irregular* shipments, and force it to promise not to take any more, on pain of being bulletined." Then Mr. Ferguson spoke up. He said : "I realize that these farmers' organizations are going to do more or less damage to us, and I doubt very much whether you can prevent them from disposing of the grain they have to sell. There is a serious question in my mind whether an at> tempt should "be made to do so. So far as I am concerned, I am not afraid of them. If they can find a better outlet than I can I am not going to holler. If they succeed and make a big success, and do a big business, I will do a little. That's how I feel in the matter." "Yes," said :\lr. Cowgill, "but don't you know that the association can do a great deal toward preventing these 'ir- WORRIED BY THE OMAHA GRAIN EXCHANGE 127 regular' dealers and shippers from getting the full value and wortli of their grain?" N. B. Updike was inclined to side with Mr. Ferguson, and thought the best ^ay to handle the "irregular" shippers was to keep on good terms with them rather than be fighting -them. Then James Bell spoke up and said : "Gentlemen, you have got away from the subject I am anxious to hear Mr. Peck conclude his talk witli regard to this new grain exchange. I am interested in this as well as you dealers who live here in OmahaJ' - Mr. Peck then continued : "The grain dealers here in Omaha have a number of en- thusiastic and substantial friends amoJQg the business men of the city, and if they should ever learn that the grain deal- ers in Omaha and. in Nebraska are inclined to 'bump' this new market, tliey would in turn 'bump' us Omaha dealers as well as our association. Therefore, we must be very careful. Undoubtedly, G. W. Wattles will be elected president, and he is a square man. His heart is in this enterprise. While he knows little about the grain business, still he is a great worker for anything and everything that will benefit Omaha. If, when he is elected president, he should find out that we were not exiting ourselves, in the interest of the grain ex- change, he would raise Cain with us, and the jig would be up. I tell you you can not fool Wattles, and I believe the best thing to do is to let. us fellows here in Omaha join the exchange, do the best we can, and report." The meeting adopted Sir. Peck's view of the situation, and it was agreed, informally, that the Omaha members of the grain trust should join the grain exchange and keep the out- side members posted. With this understanding the meeting, at a late hour adjourned. Mr. Miller and I came down the stairs together, and walked down tjie street. I said to him : "Miller, what's the scheme? What is going to be done about this exchange? I don't feel at all satisfied with the talks I Jieard to-night. I said nothing but listened mighty 128 THE GiJAIN TRUST EXPOSEO bard, and there were quite a number of others who did as 1 did. I want to know it all. How can you expect a fellow to sit in a game and help do up another fellow unless he is put on by some one who knows all about it?" "Come on down to the Henshaw, and we will get a lunch," said Miller, "and I will tell you everything." When we were seated and had ordered our sandwiches and coffee, Miller began : "G. W. Wattles is going to be president of the Omaha Grain Exchange. That is practically settled now. Being president of the exchange he will also be a member of the board of directors, and have the appointing of all the com- mittees, which is of vital importance to everybody interested in the grain trade. What we care most about is the com- mittee on membership. -If this committee will allow such fel- lows as Vincent, Butler, and Doctor Euglehart to become members, it will be a mighty bad tiling for the association, and make no end of work for ine. The Bee building crowd are all working to get four members on the board of di- rectors." "What names have they on the slate?" I asked. "Peck, Oowgill, Updike, and Meriiam. Some of them are dissatisfied with Merriam, as he has made a great deal of troiible .occasionally." "What's the matter Avith Jaquith?" I suggested. "He would be all right, but won't take it. Some of the boys have spoken to him about it." "Miller," I said bluntly, "what's the use of this talk about getting Peck, Oowgill, Updike, and Merriam on the board, of directors? Do you really think that this can be done? I know better tJian that, and I do not know very much either. It would be equivalent to taking four men out of the same company. While they do not all belong to one company, yet they are so close together that there is little difference." "Well, Oowgill and Bewsher think they can make the scheme work." EDWARD S. WESTBROOK President of the Westbrook-Gibbons Grain company .-^^fO'* LP I r- NELSON BLACKWELL UPDIKE President of the Updike Grain company J. S. BROWN Buyer for the Trans-Mississippi Grain company WOUEIED BY THE OMAHA GRAIN EXCHANGE 129 "They can't do it. You must not think, jMiller, that when our Creator was distributing brains that he did more for our gang than he did for hundreds of others who are not en- gaged in the grain business." "You, may be right," he admitted, "but I do hope the (Scheme will worlf, as it means a great deal to every member of the Nebraska Grain Dealers association." By this time, having finished our lunch, we bade each otlier good night, and separated. The ne.^t day I laid the whole scheme before J. B. Wright, the president of our company. He thought the Omaha deal- ers ^\ere chumps to encourage the Omaha Grain Exchange in any manner whatever. He. declared the thing to do was - for everybody to "bump" it and "bumj)" it hard. I explained to him what a unanimous and enthusiastic backing the ex- change had in Omaha, which made it impossible to fight the project openly. It was my opinion that the exchange was coming, and coming to stay, provided it was really the plan of the railroads running into Omaha to establish a cash market there. It made but little difference, I said, what he or I, or all the members of the Nebraska Grain Dealers as- sociation thought. We were helpless to defeat the opening of the exchange, and I did not think it wise for us to make any effort to do so. He said: "We have got to do something or our profits will be cut to nothing, and our property v/oh't be worth a damn ! What do the dealers in Omaha mean by advocating and encourag- ing a"y such an enterprise? If they do start a cash market up there, let us get all the dealers interested in^he business here in Lincoln to - organize" a g-fain market here. If it is going to be a good thing for Omaha, why- wouldn't it be a good tiling for Lincoln?" "It's too late," T said. "You can't do it now." Just at this jimcture the buzz of the telephone put an end to our conversation. Answering the call I found that Ed Slater of the Central Granaries company was ready to check 130 THE GRAIN TEUST EXPOSED up the card prices sent out the previous day in order to cor- rect mistakes that might have been made. In this work of checking up we would run through the list of stations, be- ginning with Rising City, and including Valparaiso, Ray-, mond, Havelock, Prairie Home, Cortland, AlvOj Rockford, ■ Virginia, Fairbury, Ruskin, and Narca and Munden in Kan- sas. In this way if any mistakes had been made they would readily be discovered. This checking up process took place every two or three days between our company and the Cen- tral Granaries company. Whenever a mistake was discovered the clerk ^bo was to- blame was called on the carpet, and cautioned to be more careful in the future, as even a slight mistake might tear into shreds and tatters that harmonious and friendly feeling that must always prevail among line house dealers. Soon after this talk with Mr. Wright, I went to Omaha and had a long conversation with C. J. Lane, assistant gen- eral freight agent of the Union Pacific railroad, at his resi- dence in that city. The establishment of the Omaha Grain Exchange was the chief topic of discussion. He said to me; "Tom, this Omaha Exchange is bound to bring about a revolution in the grain business in Nebraska. I have felt for some time, and now am convinced, that you fellows have kept things twisted up too tight The farmers have stood it about as long as they intend to, and are going to fight for what they know they have a right to fight for. You can't blame them, and I believe that all of you grain men would do better to get next to these farmers rather than to con- tinue inviting this trouble. I have given this same warning to Peck and Cowgill, not once but a dozen times, but they won't agree with me. While our railroad has blocked the farmers at many places where they were seeking sites, our legal deixirlment warns me that should these fanners at any point institute mandamus proceedings they would win out under the common law every time. We may be able to keep them out for a wkile, but some day some shrewd and WOliRIED BY THE OMAHA GRAIN EXCHANGE 131 determined man who is just as smart as we are will get into this game, and fight the fight through with us. When he has beaten us in the courts, as he will in the end, then the bars will be thrown down, and when once down they can never be put up again, I believe the thing for your com- pany to do is to become a member of thi^ exchange. With the brains, money, and enthusiasm that are back of it, it is sure to succeed, and you can't stop it. When the Great- Western railroad built into Omaha, President Stiekney set the people on fire with this grain exchange project^ and the fire is still raging. Mr. Munroe and I have considered this question very carefully, and we are both agreed. Of course, BO far as the fight with the farmers is concerned, I recognize that the Nebraska Grain Dealers association can, and doubt- less will cause these farmers ail kinds of trouble in the mar- keting and gale lOf . their grain. The members of your association are all intimately acquainted with the ins and outs of the business, from A to Z. They can put blocks here and chunks there, under> the wheels of the farmers' cars, and proijably wear a great many of them out, but other . farmers afid their organizations will step in to take the place of those who have lost, and in the end the farmers are bound to win. This is my deliberate judgment I may be wrong, but I do not think I am." The conversation continued along these lines, very fraakly and candidly, for more than an hour. When I left Mr. Lane I knew very well that the attitude of the Union Pacific rail- road toward this Omaha Grain Exchange was going to be distinctly favorable. No matter what other railroads might do, the Union Pacific was going to haul all the grain into Omaha that they could get, leaving it to the other lines to make the fight as to who should haul it out. WTien I went back to Lincoln I detailed to Mr. Wright, and to others interested in our company, what Mr. Lane had told me, and several informaLconferences were held at dif- ferent times, to talk the matter over. It was finally agreed, 132 THE GRAIN TRUST EXPOSED and over my protest, that our company Avould sell nothing in the Omaha market when it should open up, unless the Omaha dealers should be able to pay for our grain a better price than was olfered elsewhere. In all cases where the same price was offered at Omaha and some other point, we would ship our grain to the other x>oint. Along about this time Secretary Miller came to see me, not a little disturbed over the attitude of the two elevator men at Eagle in Cass county. One elevator at that i)oint was owned and operated by Ed Wenzel & Son and the other by G. W. Venner &. Company. Both of these firms had been in business for years, Avere members of the association, and until recently had abided by the association rules. Lately, however, they had fallen out over a division of the gTain marketed at that station, and the consequence was that all the adjacent territory was threatened with, a serious disturb- ance, which might mean ruin in the end to not a few dealers at nearby points. Grain men, in consequence, were walking the floor until late in the morning, worrying over the situation. Miller complained that it was highly discouraging to him as secretary of the association, to find these old stand-bys threatening (.0 do other dealers the injustice of engaging in open Avarfare. He was greatly bothered over what to tf^ He thought he would go down to Eagle, and get the repre- sentatives of the tAvo firms together in a room, lock the door, put the key injiis pocket, and stay Avith them until he got day A\-ith a signed agreement and $200 of forfeit money in he said grimly, "if I have to stay there all summer." With this determinfition he left for Eagle. He returned the next day with a signed agi\>;ment and $200 of forfeit money in his possession that they had put up as a guaranty that in the future each firm would "be good," pay the card prices, and divide the grain coming to the station. Thus satisfac- torily Avas wai'ded off by the efforts of Seci-etary Miller what WORKIED-JJY THE OMAHA GEAIN EXCHANGE 133 threatened to be a bad mix-up, and lie was greatly encour- aged 4n consequence. While Mr. Miller was at our office after his return from Eagle, he spoke again about the Kepper Grain company at Kansas City, which was continuing to handle shipments from the farmers' organization at Axtell. He said he wished that some member of our company would go down to Kansas City," and see this firm and "talk turkey" to them; tell them plainly just how our members felt, and Avhat they would do to them if they persisted in handling grain coming from these "irregular" ers in South Da- kota. Something had to be done. The foundation upon which the recent agitation began a little over a year ago showed signs of crutnbling and giving away. The continuation of the salaries of the promotei^ began to look dubious. The new corporation is born; its backers a few agitators; its capital of gigantic propoi'tions ; its basis naught but fine- spun theories. This great corporation is to revolutionize not only the grain business, but the packing interests, the live stock interests and other business as well. DisasteJ? must be the result of such business, resting upon such un- certjain foundations. The result of such disaster must be the enrichment of a few wily promoters and consequent loss of innumerable small stockholders. "Just so, on the other hand, will a departure from good business tenets on your part bring adverse conditions. Why a^-e so many of you heve to-day? It is to become better- ac- quainted ; to exchange ideas ;. to learn of each other ; to culti- vate a spirit of fairness with respect to the rights of each other; to discuss questions of mutual interest; to try and develop better conditions with reference to evils incident to the trade. In this world — in our business, in our social rela- tions — ^we are all dependent upon each other. 'Useless each without the other.' "The grain dealer is dependent upon the producers, and your relations with him are questions of vital import and moment. Now let me impress upon your mind, and I want to make it as emphatic as I possibly can, that a spirit of con- fidence and "cordial relations as between the grain men and the producer is of paramount importance. It is a matter that should engage your serious attention. The producer is a business man in his chosen field, just as much as you are in yours. Your relations are interdependent and should be 144 THE GRAIN TRUST EXPOSED of the most friendly character. The producer is entitled to fair business consideration, and nine men in ten Avill not object to fair and reasonable margins of profit on your part. You are entitled to that; but they will object to abnormal profit. They have a right to do so. They would not be pro- tecting their legitimate business interests if they did not. If abnormal margins (which, granting for the sake of argument, could be obtained) are taken, confidence is lost and the grain grower will as a natural consequencf take measures to pro- tect himself, and you can not blame him. Not only does it antagonize the producer but other interests, besides making conditions ripe for the cooperative promoter who is not slow to take advantage. "These suggestions are not fanciful theories, but cold in- controvertible facts. 'As you sow, so shall you reap' is a sentiment as applicable to questions of business as to ques- tions of morality. "General Conditions. — You have had many adverse condi- tions to contend with during the past year. Y^our crops have been below normal in yield, especially on corn. Your wheat crop in yield was somewhat below the average, but, in the shape of quality, very bad and far below anything prevailing in your state for many yeara. This has made conditions hard in buying wheat. . It has made it hard to buy at a profit. It has caused much dissatisfaction with the producer. "Not only have your crops been below the average both in quality and in yield, making it hard to handle, but there has been much feeding of stock, in sections, too, where crops were verj- light, resulting in taking practically all of the corn, and leaving little for you and consequently no profit on your investment. "You have had to contend with farmers' elevators, most of Avhich concerns began business during; the past year. These started in business apparently on the theory of rule or ruin rule in respect to controlling the business with their many stockholders, who, under their constitution and by-laws, are QUAEKELS AND RECONCILIATIONS 145 r compelled to pay a fine in case of selling to competing ele- vators, and consequent ruin to their competitors. Notwith- standing all these adverse conditions, your business during the past year has. been fairly prosperous. "Membership.— The splendid conditions shown in the last, annual report left but little in this respect to work upon. However, it gives me pleasure to state that notwithstanding the many trying conditions prevailing throughout the state, it has practically held its own. Notwithstanding that twenty-two ha^e sold out, several have resigned and the sus- pension of several for various causes, we had, on April 1, 275 members, representing 868 houses, as against 281 mem- bers, representing 864 houses last yetjf. Since the 1st of April, several new members have been obtained. There are some dealers who have in the past few months succeeded to former members with whom we have had no opportunity as yet to take up the question of membership and who, I have no donht, will eventually come in. Here is an opportunity for you who are in competition with new dealers to do good missionary work. Oooperatioh in this respect with your secretary will produce good results. "Finances. — You will note from the report 'of your treas-' urer tliat the finances of the association are in a healthy con- dition. The balance is not quite so large as last year at this time by about §260. The expenditures in some respects, were heavier than last year, and in others, on the other hand, considerably less. And but for the several appropriations made at your last annual meeting, amounting to $1,100,, and which have since been paid, less $120 which was returned, leaving a net charge against appropriations of |980, your balance would show a little over |1,240. "Complaints and Claims. — I am no4^ familiar with condi- tions in this respect in previous year^, but that you should have a good many complaints under this year's crop condi- tions is but natural, and there, have-been many; The princi- pal source"^ of these complaints — I am safe in saying 75 per - IQ 146 THE GRAIN TRUST EXPOSED cent of them — have had their origin in the different views of the different dealers with reference to values on your low- • gi-ade ^vheat. With something near normal conditions with reference to quality, 90 per cent of the complaints of this nature would be obviated. "Again, another source of troubles has been due to the freight rate situation, due to disagTeements between the var- ious transportation companies. In some sections competing for the same business there has been a difference in freight rates at times as high as 5 cents a 100, comjjelling dealers . on some lines, in meeting competition, to take care of the business that naturally belongs to them, to handle it at a loss. I am happy to state that these uns.table freight rates . will probably not annoy much longer, a tentative agreement having already been arrived at by the transportation com- "j panics. A stable freight rate proposition is a consumma- tion devoutly to be wished for. It will conserve the interests of all ia many Avays. ; "Again, most of the cooperative concerns began business-' during the year. In the beginning of their operations, with their policy of 'rule or ruin,' you have had much to contend:^ with. It is to be observed in this connection, however, that after a few months, more or less, as the case may be, realiz- ■ ing that the basis upon which they came into being, and which basis was laid by unscrupulous and self-seeking pro- motei's, was false, they are in a great many cases to-day trying to do business in some respects, as far as legitimate margins are concerned, at least, on a reasonable profit-mak- ing basis, and in the future complaints from these sources will be fewer. "Local Meetings. — It is hardly necessary for me to say to you that through the medium of local meetings more f^ood work has been accomplished in many and various wavs for Ihe good of the grain trade at large than through any' other source. I believe it can be truthfully said that it is the foundation stone upon which the success of association work" QtJAEftELS AND fiECONCILUTlONS 147 is Irailt. With one or two exceptions, meetings were held in every distMct at least twice — ^just prior to the movement of the^ieat crop, and later, just before the movement of the corn crop. Nearly all of these meetings were well attended and enthusiastic. Special meetings have, been called in a number of cases." Mr. Miller, as treasurer, then read the following report: / RECEIPTS IJalance on hand April, 1903 f 1,891 . 64 Dues .: 5,081.30 Fees 49.50 -Interest 15.00 Advertising 320.50 iMbitration, received $ 88.01 Arbitration, paid out 49.90 38.11 Donation , 25.00 Total $7,421.05 DISBURSEMENTS Office furniture * 103.00 Printing 293.10 Postage 449. 2f, Telephone and telegraph 185 .34 Office supplies 89 . 04 Collection and exchange 23.04 Office rent 268.75 Testimonial to Geo. S. Hayes 100.00 Expense governing comiriittee 72.49 Expense excursion, committee 28 . 96 -Expense weighing and inspection depart- ment, paid out $ 56 . 62 pxpense weighing and inspection depart- ment, received 3^-^0 20.22 148 fSE GttAIN TftUST EXPOSEt) Special account, appropriated 1,000.00 Special account, cash returned. 120.60 Stenographer's salary and extra help. . . 616.25 Secretary's salary •! • • 2,312 . 44 Secretary's traveling expense 345.86 Balance on hand April 1, 1904 1,633.30 •Total ' $7,421.05 On motion of A.. H. Bewsher the reports were adopted. D. Hunter of Hamburg, Iowa, president of the Grain Deal- ers' upion of southwestern Iowa and northwestern ^Missouri, was asked to address the meeting, and said in part: "It is with a, great deal of pleasure that I meet with you to-day, but I did not come prepared to make a speech. I have noticed the past season, in which we have had a peculiar sit- uation in Iowa, that you have been working in harmony with us. Some of our people were hailed out. You had grain to sell, however, and we found that some of it was going to ob- jectionable parties. The question was taken up with your secretary, the proper parties were notified, and card bids were at once withdrawn from those not entitled to them. I wish to say that this is the way things should be; and I as- . sure you that, if the tables are eA^er turned, we will recipro- cate. I can congTatulate you upon your association." The nominating committee's report was read by Mr. Wor- rall. It recommended the election of the follomng: For president, James Bell, David City; vice-president, W. B. Banning, Union; governing board, T. D. Worrall, Lin- coln; C. A. IMcCloud, York; Frank Fowler, Fremont Mr. Fowler later withdrew his name and C. C. Crowell, Jr., of IBIair was appointed in his place. The report was adopted and the gentlemen named were declared elected. Tlie following members of the association attended this meeting : QUARRELS AND RECONCILIATIONS 149 J. E. Morris, Fremont; Geo. W. Conrad, Wood Riv^r; J. W. Holmquist, Oakland; James Taylor, Auburn; George Coryell, Talmage; J. W. Anderson, Holdrege; J. Tighe, Wa- bash; W. B. Banning, Union; J. ,W. Bailey, Brock; A. Mause, Falls City; L. I. Coryell, Auburn; A. F. Sturm, Nehawka; F. H. McCarthy, Union; H. J. Smith, Table Rock; F. E. Young, Loonus; Ed Wenzel, 0. W. Venner, Eagle; W. A. tlpage, Douglas; A. A. Robertson, Cook; William Rundberg, Ong; T. D. Worrall, P. D. Levering, Lincoln; M. D. Eames, Hastings ; A. H. Bewsher, Omaha ; D. Holland, Havelock ; M. J. Holland, Bellwood; C. L. Aller, Crete; A. P. Stafford, Nebraska City; E. J. Rose, Ashland; N. Baiiibridge, Gretna; Prank Hendrickson, Prairie Home ; J. T. Evans, South Bend ; J. Peterson, Glen Rock; H. J. Callen, South Auburn; A. N. Vandell, Loomis; R. K. Johnson, Valparaiso; H. J. Roberts'" and J. W. Welch, Deweese; J. M. Morrison, Loomis; J. Dick- Son, Panama; O. A. Cooper and G. W. Butterfield, Humboldt; W. H. Irland, Berlin; N. Jaquot, Merna; A. F. Diels, Scrib- ner; E. E. Barber, Lincoln ; David Spqltz, David City; H. E. Calkin, Wabash; R. Unzicker,.Milford; W. J. Elliott, Su- perior; G. J. Railsbaick, Ashland; A. L. Hoover, Lincoln; George P. Milburn, Minden; F. S. Cowgill, Omaha; Frank E^-Coe and J. B. Wrightj Lincoln; R. W. Nelson, Bqokwal- ter; John Erickson, Stromsburg; J. A. Lindenholm, Blair; C. T. Peavey, Beatrice; E. G. West, Gothenburg; J. W. Knight, Walton; William Burke, Friend; G. W. Warner, Pickerel; S. J. Brown, Omaha; J. R. Morris, Fremont; P. C. : Nelson, Staplehurst; J. Cox, Hampton; C. A. Ooe, Burress; R. H. Thorp, South Bend; J. El well, Springfield; A. H. Den- ison, Elmwood; D. C. West, Wyoming; Robert 'Beckole, Waco; J. B. Nelson, Stromsburg; H. C. Halt, Edgar; C. A. Richie, Louisville; Guy Jameson, Stella; H. O. Barber, Lin- coln; C. A. McCloud, York; J. A. Blair, Lindenholm. 160 IBB GEAIN TBUSX BXPOSBD CHAPTER XIII A FKEE MAN ONCE MORE It was not long after the adjournment of the annual meet- ing of 1904 that I severed my relations with the Nebraska Elevator company. This company was organized on August 1, 1900, the incorporators being John B. Wright, E. K. Spen- cer, O. H. Eggleston, and myself. Mr. Spencer had. been elected the first president, but within a few months had sold out his interest and moved away. Mr. Wright was then elected president in his stead, and from that day until tht» time of my resignation the management of. the company had been left entirely to him as president and to myself as secre- tary. We each drew the same salary for our services, and in all important matters relating to the policy of the com- pany no action was taken by one without first consulting with the other, if it was possible to do so. On matters that had to be acted upon on the spur of the moment, the one in charge would use his own best judgment and then report to the other. During the time we were associated together Mr. Wright and myself had a great many talks concerning the policy of our company toward farmers' organizations and also toward the Nebraska Grain Dealers association. Along toward the end I began to realize more and more what an unlawful' course the association was pursuing, and to insist that the illegal and unrighteous acts of its members should be pro- hibited; I began to insist that the manly thing for our com- pany to do was to withdraw its membersliip and support from the Nebraska Grain Dealers association and go it alone, i-elying upon our best judgment for success. This attitude upon my part was earnestly combatted by those having larger holdings in the company than I had: I knew that the attitude of all the corporations of any magni- A FEEE MAN ONOE MOKE , 151 tude belonging to the trust was to crush the weak for th& upbuilding of the strong and powerful. This was the rock upon which we split. I said to the other members of our company : "If it's your fixed intention to continue your membership in the Nebraska Grain Dealers associatic^ I am done. . I will sever my connections with this company an^ go before the world in this line of business relying on myself, single- lianded and sQone. Let me ask you seriously if you have ever stopped to think about our position? If we should-fall, what an avful fall it would be! ISver since the day this company was incorporated we have been lawbreakers. "You gentlemen will sit here in these cozy rocking chairs in this nicely furnished office and talk glibly about others being lawbreakers in other lines of business and never stop to consider that we ourselves are chief among them all. We, with others associated with us, have for a long time been conniving, contriving, and conspiring for the sole purpose and intention of coming into possession of ill-gol;ten gains. Before we talk about other lawbreakers, or pretend to advise as to what should be done with them, in the name of God and all the Apostles^et's get right ourselves ! Let's put our- selves in a position so that the bright sparkling rays of sun- light can shine on each and every transaction we enter into in this line of business aud so close and bar the doors of the jails and penitentiaries while we are still on the outside. "If others will not take advice from us let tbem go on and pay the penalty just as tbey will have to do as surely as tie sun shines and gives life ta all the earth. Mr. Wright, you iiave a faithful wife and a happy home. I beg of you to <:ake thought of the sleepless nights and the scalding tears that will come coursing down her cheeks, as well as the heartaches that will surely come to you if you persist in Vontinuing these unlawful practices. Take this ?mtter home with you, and sit down alone and consider the situation carefully and then talk it over with your wife, and two weeks Ifrom to-day let me know your answer." 152 THE GRAIN TRUST EXPOSED "No, sir," he said. "This is nothing but sentiment. Whether it be right or wrong-, while I am the largest stock- holder in this company I shall insist on doing in the future the same as I have done in the past." I said : "This is your ultimatum?" He answered shortly : "It is." "All right," I said. "I am doue." And on the 1st day of -jray I step down and out. "Some other person must do this work for you, for I will do it no longer. I have fully made up my mind that I shall not continue to be a violater of the laws of our statute books. You and the others may say what you like, but I am done." With this our conversation ended, he contenting himself Avith observing that I was making a big mistake and would live to regret the steps I was taking. Soon after this Secretary Miller came to see me, having been apprised of what my attitude was to be in the future. He objected most bitterly, saying: "You can't afford to do the things you say you are going to do. It will disrupt the organization, and 'tliat which you and others have worked^ so hard to build up will crumble and fall in a short time." I said: "Miller, you are the secreti^ry-treasurer of the Nebraska Grain Dealers association and the active manager of the associatfon, subject, of course, to the ordeib of the officers. You draw a salary of |2,100, with all traveling ex- penses, office rent, postage, telephone and telegraph paid. In addition to this they pay your stenographer $75 a month. Y'our salary and the girl's salary amount to |3,000 a year and the other expenses make an aggregate total of about: $4,000. You are getting well paid. You draw as much pay. as a secretary of state, and almost as much as the governor and the justices of the supreme court, but not for the entire receipts of your office, with your salary thrown in, would. I continue to do in the future what I have done in the past. It isn't rij.;ht. I have sins enough to answer for without committing auy more. I am going to get right mvself and A FREE MAN ONCE MORE 153 when I have done this then I will he ready to talk ahout the future." ' *^i Looking at me with an angry glitter in his 6ye, Miller -answergd : "You have no right to take this course so soon after the holding of our annual meeting at which, with your own consent, you were reelected to a responsible position in our association. You know as well as I do that during the next two years we are bound to have all sorts of trouble with .these farmers' eleva,tor organizations, and if you go to Omaha and there start a company and begin to accept shipments from 'irregular' dealers you will be sticking a traitor's knife into our very vitals. As things stand noAv we are in fairly good shape. The members of the Exchange Avho are also members of the Nebraska Grain Dealers association are working together, and those who are not members of our association will have to do' as we want them to. If those ;;who refused would be bulletined that would mean that not a member of our association would sell or consign to them a single carload of grain. We haVe this big stick to hold over their heads, and it would be. suicide on their part to "invite that stick to fall. We may have to resort to harsh 'riOieasures to accomplish our ends, but this is a desperate case and so justifiessuch measures. It seems to me }ou could do a great deal better by going to Kansas City, if you insist on opening' up independently, and iJiere build up a business of your own." 'To this- 1 answered: "Miller, when I was only five years old, and while Nebraska was still a territory, my father homesteaded.in this state. I have lived here all my life. I -have cast my every vote here. My father and mother are "both sleeping the sleep that knows no waking, in Nebraska soil. Here is where I expect to be buried, and here is where I expect J:o. stay until I am summoned before my Maker to -give an accounting for my deeds on earth. And why, from a business view-point, would I do better in Kansas City? 154 THE GRAIN TRUST EXPOSED Take the map and look at the territory surrounding OmaJia| It is an- ideal place for a cash grain market." "True. But it's going to make me lots of work and worry^' "Well, work and worry. That's what you are paid for by the association." The next day I went to Omalia and presented my applica- tion for membership in the Omaha Grain Exchan,,'e. I had a t^lk with Mr. Peck and told him what I intended doing He did not confide to me what he thought of my move, but^ contented himself with asking wh^tiier or not my firm would": be "regular," and I contented myself by answering that all tlie grain we expected to handle would be raised on the farms.! I aliso met Mr. Fowler and told him what my intention's, were. He said nothing, but the next day, after I had re- turned to Lincoln, he called me up oyer the telephone and advised me not to go to Omaha and start into business, as he was satisiied I would do much better by going to Kansas City. Mr. Levering advised me to the same effect. To all these and others I turned a deaf ear and went to Omaha just the same. Soon after this, then, I tpok up, the fight on a new battle- field. Ever since I had embarked upon the business of buy- ing and handling grain my dealings had been with the farm- ers, and my efforts have been to purchase from th'?m what they raised. Now I began to deal with the dealers that dealt with the farmers, and this was practically a new business to me, such knowledge as I have of this end of the grain business being exceedingly meager. I was well enough ac- quainted with the pools and combinations at the country end, but knew nothing about the pools and combinations and other methods adopted at the receiving end, except, of course, that I knew in a general way that efforts were made to bully commission men into refusing to handle "irregular" shipments.' I, however, did not look for much trouble along this line. I thought that those I had been intimately ac- quainted with were br'oad-minded enough to look at these A FKEE MAN ONCE MOKE 155 matters as they were and face tlie propositions as they pre- sented themselves. I did not dream that any of my old friends and associates would attempt to drive me down through tlie principal streets of Omaha, never allowing me to stop until they had me in the center of the channel of the Missouji river with a 500-pound weight securely fastened to my neck. In this I was mistaken. I soon found, to my sor- row, that this was exactly the attempt that woxild be made by members of the Nebraska Grain Dealers association, not only regarding myself, but regaining all other persons who would not do their bidding. 156 THE GRAIN TRUST EXPOSED CHAPTER XIV HAMMERED BY THE TRUST The Worrall Grain company opened business May 28, 1901, as a member of the Omaha Grain Exchange. Things ran ak>ng smoothly enough until about June Tth, when Sec- retary Miller called on me and said : "I have the numbers and initials of four cars of corn that are coming to you from a farmer in Gage county. You must not accept that corn. You can not afford to handle it. If you do we will have to use you just the same as we do any one else seeking to handle this 'irregular' business." I answered coolly enough: "Sit down and let us reason about this matter. Don't get so badly excited. No one is go- ing to be hurt in the least. All this grain coming in here is coming from the farmers, and don't you know, my dear sir, that the farmers are the backbone and the muscle and the sinew of our state, or haven't you found this out yet?" I t4icn went ahead to reason the matter out with him, but he stubbornly insisted that handling shipments from farmers must be stopped before we began it. The result of the conversation w^as that I informed Miller we would have nothing to do with this corn. He seemed well pleased and thanked me, and said that if our firm would only continue to do "the right thing" success would surely crown our efforts. The second day after this conversation occurred these same cars were offered for sale on the floor of the exchange. Miller again came to see me and said : "J^ow if you want a share in the profits of thesei four cars you can have it, but it is ar- ranged that J. T. TwamlcT, Son & Co. are going to buy them at an agreed price. This price will be made after the cash market is open. I do hojie the market will be lower to-day, so it will show the shipper a loss. The Central Granaries HAMMliiteBD BY THK TRUST 157 company and the Hayes-Eames Elevator company are very much interested in this matter and are expecting us to do 'the right thing,' and we ought to help them all we can, for they are mighty good fellows and ai*e willing to reciprocate whenever they are ahla" I answered : "Miller, don't you remember that I told you before coming up here that I did not propose to enter into any scheme, pool or combination of any kind that did not -look absolutely square on the face of it? Another thing, if the president or secretary of this Exchange was to get onto our game we would be called upon the carpet before the board of directors for an explanation, and what could we say in defense of such a transaction as this you have out- lined? I tell- you we would be unable^ vindicate ourselves and OUT membership cards would be taken from us. We would be blacklisted and fired.\ Miller, you must not think that you can run the Nebraska Grain Dealers association and the Omaha Grain Exchange both. If~you attempt it it will only be a question of time until you will fail miserably. You had better confine your efforts to the business of the Grain Dealers association and do what, you are paid for do^ ing, which is to look after the members out in titie country." At this juncture Mr. Bewsher took Miller off to one side of the exchange -floor and they held a hasty conversation. Miller then came back and asked me for the second time to take a hand and bid on the four cars of corn which the West- brook-Gibbons Grain company had forsale, being the four cars shipped by the farmer in Gage county. He said: "We are going to let Twamley buy them, and a 'jackpot' of 4 cents a bushel will be made out of the profits, and all the 'good Indians' will share and share alike." The "good Indians" were the Omaha ' Elevator company, the Updike Grain company, the Trans-Mississippi Grain company and the Westbrook-Gibbons Grain company. As Twamley was considered a g;ood felloAV, he was to take the coi:n and divide the profits with the other four companies. 158 THE GKAIN TRUST EXPOSED It would net them about $40 each. TJie deal was carried through. The corn was sold to Twamley at 4 cents a bushel less than it was worth by E. S. Westbrook and the sale was reported, as the records of the exchange for June 9, 1904, to be found in the secretary's office, will sbow. After the deal was closed Miller said to me: "I would have liked to see your firm share in this money, as you are just starting, have been to considerable expense, and this was 'easy money.' " I said: "Miller, I have some respect for the man or set of men that attempt to rob a bank or to break into my house at midnight, for should I suddcjily awaken I would have some sbow of protecting my property. I could at least let the robber know that I was trying to protect it, even though I failed. But in this case the farmer is robbed and has abso- lutely no chance to protect himself. You and the other par- ticipants in this deal, in my humble judgment, are worse than the midnight burglar. The farmer who shipped this grain is at home attending to his daily duties, never dreamt ing that when the sun was at its meridian height and the hum and buzz of commercial life was to be heard on every hand, that in a civilized community he was deliberately be- ing robbed and he one hundred miles away as innocent as a new-born babe." Miller, with never a word, turned and left me and went upstairs to his office. Two or three days later he came to me and said : "Do you understand that you are still a mem- ber of the governing committee of the Nebraska Grain Deal- ers association?" I said : "Yes, I was elected at the laSt aitnual meeting by the members' present, and there were a good many there." "I know that," he said. "But since that time vou have severed your connection with the Nebraska Elevator com- pany, and I do not believe you ought to sit in our meetings or act on the board to which you were elected." He added that he had talked this matter over with some of the boys HAMMERED BY THE TRUST 159 and they thought as he did, and that as he was going to call a meeting of the board to consider certain questions, he , thought it would be an opportune time to hand in my resig- nation and to allow my successor to be selected. I told him I would think the matter over and-let him know my decision later. The following day I consulted with some of my friends, including a member of the association, and they united in advising me not to think of doing such a thing at that tima I advised Mr. Miller accordingly. He used all the moral suasion at his command to induce me to resign, byt I stood firm. It ViTas easy to see that since I was no longer in a position to do good and effective work for the trust and lacked the inclination to do so that my presence was no longer desired in their conferences. I had notices before this that a great change had taken place in the attitude of a great many members toward me. J have seen the time when the managers and ofticers of the Nebraska Grain Dealers association would cross the street, and by so doing take great chances of being run over by street cars and automobiles, to get where I was and ask about the prospects of" getting a deal fixed up at some par- ticular point where they were interested, so tha^ harmony would prevail. Not so now. Merely a nod of the head when we met on tlie street or in public places. There Avas nothing strange about all this, however, although I had worked in and out of season to help the association accomplish a gr&it many things that were beneficial to its members, but I had now turned orer a new leaf and my interests were no longer theirs, for I was willing to rely wholly and solely on my own good judgment and hard work. They wanted nothing but a pool and combination which called for neither intellect nor judgment, but would enable them to make big money though no one but the office boy should run their business. I, in other words, was willing to do a legitimate business while they would be satisfied with nothing but a "lead pipe cinch." 160 THE GEAIN TRUST EXPOSED One day Secretary Miller informed me that there would be a meeting of the governing committee the day following, and that matters of great importance were to be considered. I could tell by the look on his face that something of an un- usual character and of more than passing interest was brew- ing, but for the life of me I Avas at a loss to know what it might be. I asked I\Ir. Bewsher what Miller was calling the governing committee together for. Although he answered that he did not know, I was almost positive that he did know, as his manner, when answering me, gave me good cause for suspicion. I believe still that he knew what was up, for he spent more time in the secretary's office coaching Secretary Miller as to what to do and what not to do than did all the other members of the association combined. Bewsher had taken a great interest in the Avork while he was secretary, and was noAV more than anxious that his successor should do nothing that might tend to weaken the great structure he had done so much to build. In his coaching of Secretary Miller I have no doubt that Bewsher had the hearty ap- proval of JMr. E. P. Peck, the general manager of the Omaha Elevator company, as the success of the company depended very largely on keeping the organization in perfect trim, and it was advisable for them to keep in close touch with the machinery. When the time fixed for the meeting arrived I was on hand.~ There were present the president, James Bell of David City, Christopher CroAvell, Jr., of Blair, C. A. McCloud of York, Secretary' Miller and myself. Miller had instructed his stenographer to take a vacation for the afternoon, since she nor any one else was wanted around while that meeting was in session. When all were present Mr. Miller closed the door. I am not- positive that he sprung the lock, but I be- lieve he did so. Then, without loss of time, jNIr. Miller spoke. He said: "Boys, there is trouble and a vast amount of it brewing. I don't know Avhat to do. I want your advice in this matter. ^ ^w^i • ■ ■ ■ .*-'•* -'N I - • ■■!'•' ,T.-,^ / te HORACE G. MILLER Secretary of the Nebraska Grain Dealers association E. J. SMILEY Secretary of the Kansas Grain Dealers as- sociation, who was tried, found guilty, tind served his sentence in jail for violating the anti-trust law of Kansas. HAMMERED BY THE TRUST 161 I though t that the agitation among the farmers for elevator sites was waning, but recently they are more numerous and pestiferous than ever. New applications are being made every day, and the opening of this exchange has resulted in stimulating them beyond my expectations. I have worked hard and. put as many rocks in their way as I could, and now I hardly know what to do. But I have adopted this plau, and I want to carry it out if this committee will con- sent to the expenditure of the money : "The Omaha Trade ExUbit, a paper published in this city with a circulation of about 20,000, has agreed that for fl,000 it will print and send out 20,000 sample copies, in addition to their regular edition, containing such matter as we desire 'to have published. This matter is to be prepared by the committee selected at our last meeting down in Lincoln." "Tell us about this committee and who authorized it," in- terrupted the president. "At a' meeting held in the offices of the Central Granaries company at Lincoln," Miller replied, "Frank Fowler, G. J. Kailsback, Frank Levering, N. A. Duff and A. H. Fewsher were selected a committee to prepare stroijg articles on the subject of farmers' cooperative elevators and to send these articles to their retail and wholesale merchants in the state of Nebraska. No matter how small the merchant might be or how insignificant his business, our plan was to make him believe that if these farmers succeeded in their cooperative enterprises in the grain business it would only be a short time before they Avill be starting cooperative grocery stores,. dry goods stores, hardware stores and lumber yards and so drive those retail dealers out of business. These merchants, will have more or less influence on the banks and they will begin talking to the farmers to discourage this cooperative business. All this will create public sentiment, and this is one very necessary ingredient that we are shy on. This com- mittee has gotten together a lot of good hot stuff and they want it printed in this Omaha Trade Eijchihit, as this will 11 162 THE GRAIN TRUST EXPOSED reach all the merchants. It Avould not do to send the papers to the farmers, as they would say : 'Oh ! the grain trust is paying for 'this.' But when our argument goes out to the merchants in their regular trade organ they will suspect nothing irregular. I might say in this connection that as a matter of fact the merchants at many, places cause us more trouble than the farmers do. Whenever the grain dealers at any particular town happen to be paying a little more for grain than those at other points the merchant at once ad- vertises the fact to attract trade,"" and the merchants at the town where a low price is paid begin to realize that the farmer will spend his money where he sells his grain. These merchants who thereby lose business blame the elevator com^- panies, and together with the farmers, begin agitating for the organization of a farmers' elevator company. It is -to reach these fellows that these articles are to be printed and sent out. I believe it will do lots of good. Now what do you think? I want each of you to express yourself frankly." I was the first to respond to this appeal. I said: "I am of the opinion that it would be useless to spend $1,000 of the money belonging to the association in such a way, as it would do no good." President Bell and Mr. McCloud were even more out- spoken than I was and bitterly opposed the project Mr. Crowell thought that so long as the big line houses had to put up the bulk of the money to defray the expenses of the association, and felt that by the expenditure of this sum they could accomplish something, they should be granted the privilege. Mr. Miller, of course, thought the same, but the vote stood three to two against the proposition. It was then decided that the committee should attend a meet- ing that evening in the office of the Omaha Elevator coin- pany, in the Bee building, and consult with other interested parties concerning the matter. At this second meeting quite a number of the brethren were present, including George H. Hayes, Frank Levering, HAMMEKBD BY THE TRUST 163 Frank B. Ooe and W. H. Ferguson of Lincoln, G. J. Rails- back of Ashland, James Bell of David City, Frank Fowler of Fremont, Christopher Crowell^ Jr., of Blair, and E. P. Peck, E. S. Westbrook, A. H. Bewsher, N. B. Updike, O. A. McCloud, F. S. Cowgilli E. A. Cope and Floyd J. Campbell of Omaha. Secretary Miller, in calling the meeting to order, stated that the governing committee had not as yet consented to the expenditure of the |1,000 proposed to be paid to the Omaha Trade Exhibit for sending out 20,000 extra copies of their paper containing our matter throughout the country. Mr. FoAvler, as spokesman for the literary committee, said that it had been his understanding that the bureau was au- thorized to spend this amount. He said considerable work had been done, and he for one did not see how they could possibly manage to keep the publisher from going on with the work. While no contract had been signed, there was a verbal understanding that the work was to be done and the money paid for it. He said that he personally had gone to. considerable trouble and some expense to get the matter that was to be printed in this paper, and he thought that its pub- lication would be -wise, and would result beneficially to the line house operators. Mr. Bewsher then took the floor and said, in substance, all that Mr. Fowler had said and a great deal more. He said that the grain dealers' association in Iowa had adopted these tactics, and its members were well pleased with the experi- ment. He said that at towns surrounding RocVwell City they were fighting this cooperative craze and were meeting with good results ; that Secretary Stebbins of the Iowa asso- ciation had sent him some hot stuff to be printed, and' had promised to send him much more if it was needed. Stebbins, be said, thought that by all means the Nebraska association should adopt this plan and do everything possible to check the wave that was threatening to engulf the grain dealers in eveiy agricultural state in the Union. 164 THE GRAIN TRUST EXPOSED Mr. Levering said there was no use denying the fact that in the western and southern portions of the state the farmers' elevator agitation was becoming more and more threatening. Grain dealers' profits had heen reduced because of it in some places to a very noticeable extent. Aa.tbe money required to make this esxperiment would amount to only about a dollar and a quarter per elevator, he believed it would be wise to try it. It could not hurt anything, and he was most heartily in favor of spending a great deal more than this to head off, if possible, the independent movement. G. J. Kailsback said that the amount required would not make nor break nor set anybody up in business. He was willing and anxious to give the scheme a txial, and if the treasury should be depleted he was heartily in favor of an assessment to replenish it. "If we accomplish anything," he said, "we have got to come down Avith the'clough, as the long green' is what does the business." Prank E. Coe of the Nebraska Elevator company was called upon for his views. He frankly admitted he was a new member; that the gxain business was a new business with him, and that he was not personally acquainted with any farmers' or farmer elevator organizations, but just the same he was in favor of doing anything that seemed wise to the' older members. N. B. Updike said that he did not believe the experiment would result in doing much good. W. U. Ferguson said that he was in competition with farmer elevator concerns at several places, that he got along fairly well Avith them. Then some of those present intimated that because Ferguson managed to get along with so little friction with the farmers he must be becoming a farmer him- self. Ferguson retorted that the easiest way is the best way. He said that AAiienever you tell a bunch of farmers they must not do anything you make them the more anxious to do that very thing. He added: "I don't know what is best for us to do under the circumstances. Sometimes I MRS. KATE KEHOE Actively engaged in the grain business at Platte Center, Nebraska E. J. VAN DORN, Independent Dealer and Member of the Omaha Grain Exchange. ('>>: ^ Map of Nebraska sliowing state divided into thirteen " price districts." HAMMERED BY THE TRUST 165 have queer notions in my head regarding this association, but I do not care to discuss them now." Mr. Peck gave his hearty approval to the scheme, and said he would approve any reasonable scheme that would have for its aim and object the advancement of the interests of the line houses, and the killing off of the farmers' elevator companies. Secretary Miller ^hen said a few words. He hoped that each one present yould give him credit for being in earnest, even though his judgment might be at fault. He suggested that the question be settled, then and there, by taking a vote that might serve to guide the action of the committee regard- ing the proposed expenditure of money. A motion was made and was seconded by half a dozen members. The vote was taken, and all present voted to spend the |1,000 on the "Omaha Trade Exhibit, excepting Mr. Bell, Mr. McCloud, Mr. Ferguson, and myself. The' committee then got off into one corner and voted to authorize the secretary to draw a check for the amount, and go on with the work. This was the last meeting of any considerable number of the members of the Nebraska Grain Dealers association that I attended, although I afterward attended two 'meet- ings of the governing committee. Soon after this Secretary Miller came to me and said: f'Some of the boys really think you ought to resign your position on the governing board.^ They think that since you have ceased to be manager of the Nebraska Elevator com- pany, and refuse to put the new company you have organized into the association, you are not eligible, and I wish you would act according to their wishes. The truth is, that you and Mr. Peavey are showing too much independence since you started in business here." I realize that you have given the association go&d service in its past, but right now we have got to hew to the line, let the chij® fall where they may. It wouldn't be wise for us to allow the best inter- 166 THE GEAIN TRUST EXPOSED ests of the members to be jeopardized out of regard for some one person who, though he may have been with us in the past, is not in entire harmony with us now. I hope you won't take offense at what I am saying, and will take this talk in the same spirit that it is given. You know as I do, that the future of the line houses doing business in Ne- braska depends on the organization remaining firm, and using alike all the violators of our principal rules. This has got to be done. It keeps me awfully busy watching for this 'irregular' stuff that's coming into the Omalia market. Just this morning I went to see J. E. Van Dom, manager of the George A. Adams Grain company, and found he had two cars of grain from the farmers' elevator company at Gretna. He has promised me not to handle any more of that kind of grain. Whether he will keep the promise or not is something I can't say, but if he accepts any more 'irregular' grain I am going to bulletin him, and let the dealers out in the country know just what he is doing. Then it will be up to him to square himself with the 'regu- lars,' or he will have to confine his business exclusively to 'irregular' shipments, and if he does that he will have a hard time of it disposing of his grain at Chicago, St. Louis, Kan- sas City, and other terminal markets." I never talked with Secretary Miller before when he showed so much determination. I could see, by the expres- sion of his face, that he was weighing every word that fell from his lips. I was not so ^een but that I could under- stand that a. caucus had been held between himself and others, and that he was simply saying to me what he had been instructed to say, and so I answered him : "Mr. Miller, I am now satisfied that the time is near at hand when you and I, and the other members of tlie Ne- braska Grain Dealers association will come to the parting of the way. I have felt that the time was coming since long before we had that talk at Lincoln, on this same subject, in consequence of the manner in which you and Bewsher and HAMMBEBD BY THE TEUST 167 others have acted toward me since my entering into business here in Omaha. It is only a question of a short time until our relations will be strained, if you persist in doing as you have done. And I warn you that when the break comes, - you will think an earthquake has struck you, and will be calling at the top of your voice upon the good Lord to let the rocks and mountains' fall upon you, and so save you from having to look through prison bars at the rising and setting of- the sun. This will come about just as sure as you and I are talking together, if you persist in doing these unlawful things, or in causing them to be done. As to my resigning from the governing committee, I will do no such thing, and I am surprised at your persistence^in demanding that I do so, although I admir^ your nei^e. In this con- ' jaection I am going to tell you a story : During the panic of 1893, a Pennsylvania bank was forced to close its doors. The next morning a large crowd of depositors were congre- gated about the door of the bank. It was a motley crew, composed of people from all walks of life; business men, washwomen, and day laborers were there, and there was some very harsh language used about the, officers of this bank, and especially the cashier. Some one declared that if they could only get ahold of him they would hang him to a street lamp. Others thought the proper punishment would be to cut him up into strips. Some wanted to dispose of him in one way, and some in another. At the height of the ex- citement the door of the bank opened, and out walked the cashier. He waved his hands for order, and silence fell upon the deeply interested depositors. The cashier spoke and said : --- , '" 'Ladies and gentlemen, this bant in whfch you placed your meager savings for a rainy day, is broken, completely busted. It will never pay you one cent on the dollar. You will all be better off to go back to your work, and by indus- try and economy, save some more money. It almost breaks my heart to make this statement to you customers of this 168 THE GRAIN TRUST EXPOSED banlc, but I have told the facts. To those of you who have trusted your deposits with us, and have given us your busi- ness, I return most hearty thanks. I bid you all good morn- ing.' With that he turned around and went into the bank, closing the door behind him. "A dead silence prevailed for a few moments. Then one man spoke up and said : 'What do you think of that?' An- other said : 'Don't that beat H ?' Another said : 'What do you think of the nerve?' "Just then an elderly gentleman from the soil of Ireland, who was sitting on a spring seat on a farmer wagon, shouted out: 'I say b'ys, if y's fellows should do what ye was talk- ing of doin' before the gintlemon made the spach, and should cut his body into shtrips and divide these shtrips among yes- selves, ye would oblige me greatly by givihg me a small piece of his gall.' "Now INIiller, I hope and trust that nothing of this sort will ever occur to you, but if there should, I must confess that I, like the Irishman, would feel called upon to speak for a piece of your gall, for you have no business to ask me to resign. My best friends have apprered of the stand that I and those associated with me have taken. You and Mr. Bewsher are not the 'whole cheese.' I was elected by the association, and whenever the association asks me to resign I will do so, but I would not think of resigning merely to please you and this bunch that you have about you. "And now, so that there may "be no misunderstanding, I want to tell you plainly just what the attitude of my firm is going to be hereafter. We are going to solicit business from every responsible company or concern that owns and operates an elevator on the right-of-way of any railroad in Nebraska, when there is a chance of our making money by doiug so. Did you understand just what I said, and notice ' how T said it?" "This is what I understand," retorted ililler. "that you are going to take shipments from these farmer elevator coia- HAMMERED BY THE TRUST 169 panies whenever you can get them, whether they are 'regu- lar' or 'irregular.' " ■ -_"That is it, exactly. You have it right, and I Wcaut to tell you, Miller, that we axe absolutely right. This is a young market, and if it is to be made a success we must not be so narrow-minded as to discourage the shipment of grain com- • ing here for sale merely because it is not shipped by a mem- ber of our association. I know that Peck, Cowgill, Bewsher, r Cami)t)ell and Westbrook, and in fact nearly all of the mem- bers of the association, will disagree with me as to this prop- ; osition, but I warn you that if you, as secretary, do not s^op putting cockleburs around where they will bother me, that my partner and I will get a new supply for ourselves, arid will use them. You have made threats about what the association can and will do. Now are you going to make these threats good? I dislike a row, and will do anything in reason to prevent one, but I "am giot going to smother my convictions dud stultify my manhood in order to assist you and the Grain Dealers association in doing unlawful things. i'Onlj yesterday," T continued, "1 talked with Mr. Wat- tles. He is a broad-minded tnan. He has made a success of l^s OAvn business, and as I have said to you, is deeply inter- ested in the welfare of this Exchange. I told him just what I have told you about the course I intend pursuing in the future. He said: 'Worrall, if I were you, I would go one step further, and solicit business from any reputable per- son, company, or concern. There is no question that you are right' That's the way that such men as Gurdon W. Wattles, .president of the Omaha Grain Exchange, looks at this busi- ness, and it strikes me you had better devote your time^ labor- ing with those who take exception to our way and manner of doing business, rathenhan spending all your time.harass- ing us with threats of bulletins and boycotts, and other awful things." Miller made no answer, but went away, in something of a huff. I noticed during the next few days that he and 170 THE GKAIN TEUST EXPOSED Bewsher si>ent some time around the table that contained samples of grain our firm liad for disposal, placed there by the chief inspector, Mr. Hyle. I also noticed them jotting down the numbers and initials of the cars. All this informa- tion was easily obtained from the pan ticket that comes up with each sample. Just as soon as I tumbled to their game I went straight to the secretary, A. H. Merchant, and asked whether Mr. Miller was a member of the Exchange, and if not, where he, got his authority to have free access fo the floor for no other reason than to make trouble for members who were buying of "irregular" shippers. Mr. Merchant asked : "Is that what he is doing?" I answered that it was, and referred him to other members of the Exchange ior confirmation of what I had said. He said: "I will see to it that this business is stopped mighty quick." In two or three days I noticed that Miller came on the floor very infrequently, but would come to the door of the Exchange and stand there until he had an opportunity to beckon to his general manager, Mr. Bewsher. Bewsher would then walk over to him, and get the numbers of the cars that he had learned had been shipped by "irregular" dealers, and then coming over to our table, would do "the rubbering act" liimself. While Bewsher was a pretty busy man, he still had plenty of time to do anything that would benefit the association by driving the farmers out of the market, and by throwing a harpoon into Tom Worrall and his associates. About this time T. A. Bryant, representing the Brinson- Waggner Grain company, came to Omaha and called on me. He said : "Secretary Miller is knocking you to beat the band. He held a meeting at Kearney recently tliat ^ learn was well attended, and while there he poisoned tiie minds of all the dealers in that district against you. Some of them told me they would never do any. business with you again, as they intended to stand togetlier." HAMMBBBD BY THE TRUST 171 I asked Bryant if he though it would do any good for me to go out there and see those dealers myself. He thought it would and offer^ to go with me if I would wait a few days^ and to this I gladly consented. That same evening, sitting alone in my office, with no one t» disturb me, I went over the entire situation. I thought of those dependent ones at home who were relying upon my ability to work and do business for their maintenance and support. I thought of those whose confidence in my hon- esty and good judgment had led them to extend to me a line of credit far beyond my expectations. These gentlemen, and others, had spoken encouraging words to me when I em- barked in this business, and had predicted that success would crown my eflPorts. But they knew but little about the pools and combinations that were strangling the grain trade in Omaha. I thought of'the farmers who were being- made to pay tribute to this grain trust, and of the farmers' boys, who, aspiring to get on in the world, might even dream of coming to Omaha to embark in the grain business. What show would they have of making a success? None; abso- lutely none, with this trust and combination organized and working against them. But^ L thought, any organization or any business that has for its foundation walls unlawful acts, fraud, deception, chicanery and bulldozing Will fall to the ground in time, and so will the ^Nebraska 6ra,in Deal- ers association. I then and there made a resolution to go at it and make the best fight I could make to bring about a condition that would permit any man who wished to enter the grain business to stand on an equal footing with his com- petitors, without having to enter into an unlawful combina- tion. The hour was late before I had fully determined upon my plans.' I realized full well what I was going up against, but I had good health for which I have ever been thankful, and an inclination and desire for work, and faith in my own ability, and a mountain of hope that I would win out in time; and I can say now, modestly and without boasting, 172 THE GRAIN TRUST EXPOSED that a great many things have happened since I formed that resolution to discourage the secretary and the officers of the Nebraska Grain Dealers association. Along about this time the Nye-Schneider-Fowler company and the Updike Grain company — perhaps I should say Frank Fowler and N. B. Updike — got mixed up in a good old- fashioned fight over the division of grain that came to eleven stations where they were both doing business. For five or six weeks there was competition in earnest, and it was a battle roj'^al. , One party insisted on a penalty pool at these eleven stations as a basis for dividing, and the other insisted upon a physical division. Neither would yield. Each side claimed that it would blow in |50,000 before it would sur- render. The fight was so hot that it kept Miller busy, and while he was busy with them our business enjoyed a little peace, as he had no time to devote to us. But finally Fowler and Updike were called to Chicago, and told that this rough and tumble must be ended. The Burlington and Union Pa- cific officials did not propose to permit it to go on any longer.. Their word was law, and a compromise was effected, and the war was over. Competition was dead again at those eleven points, and the price committee again reigned supreme. BOYCOTTING FAEMEES^ SHIPMENTS 1^^ CHAPTER XV BOYCOTTING FARMERS' SHIPMENTS With the settling of the Fowler-Updike fight, Miller again had an abundance ^ f time to devote to our firm, a fact as pleasing to him as it was gratifying to those for whom he was working. He and Bewsher also gave their attention to other firms situated somewhat similarly to our own. And here let me say that in using Bewsher^s and Miller's names as frequently as I liave had to do, it h^s not been with the tiitention of intimating that these two gentlemen have been more sinful than others connected with the trust, or that they have done more than others in their place would have done. They were both hired men, one engaged to further the interests of the line house elevators, and the other to do the bidding of the general manager of a big corporation. If either of them failed to do what was expected, it meant that some one else would take his place. But I must also say, by way of downright criticism of Mr. Bewsher, that he was not-a fair fighter. His voice is as soft as the footsteps of a cat, and his favorite method of travel is by the underground route. He prefers tp work underhanded rather than to be open and aboveboard, and to win easily by misleading you rather than to win with difficulty by being fair and honest. Rudolph Reals, manager, of the Nebraska Hay and Grain company, a member of the Omaha Exchange, thinking this to be a free country, was unable to understand why a, busi- ness man should not be permitted to do business with whom- soever he saw fit. When Miller and Bewsher tried to bully and- dissuade' him from accepting the shipments 6f "irregu- lar" dealers, he told them as much. The result was that Mil- ler called a meeting of those memlsers of the Omaia Grain Exchange who were also members of the Nebraska Grain 171' THE GRAIN TEUST EXPOSED Dealers association. At that meeting those who were presr ent agreed that they would have no further business connec- tions with Beals. The Merriam-Holmquist company had been buying a great deal of grain from him, but was notified that it must quit doing so — ^and it did quit.' Not satisfied with thus interfering with Beals' business, Miller arranged for another meeting at which members of the Grain Ex- change w^ho were not members of the association might meet with those who were, and agree with them to strike Beals olT their list. This second meeting was held, being attended by E. S. Westbrook, A. H. Bewsher, H. G. Miller, Walter Holmquist, F. J. Campbell, E. A. Cope and J. F. Twamley, who were members of the Grain Dealers association, and by J. E. Van Dorn, Tom Worrall, William Sunderland, G. E. Barnes, 0. G. Thompson and 0. T. Peavey, who were not members of the association. The members of the association were anxious to bring about a general agreement to have nothing more to do with Beals in the way of their buying from him or selling to him, unless he would agree to stop doing business with "iiTegular" shippers, but the independ- ents who were present would not agree to this. William Sunderland, in particular, was frankly plain and outspoken. He said : "On account of my relations with Nels Updike, I will not ofPer to do any business on the floor of the Exchange with Mr. Beals, and I will tell him so. I am not going to beat around the bush about it, but it does seem to me that you line house operators have a tremendous lot of nerve. Sim- mering it down to plain words, you have the effrontery to forbid us outsiders to do business with any one who refuses to do your bidding. Then having done tMs you will go to members of the association and ask them, when terms are equal, to give you the preference over us, because you are members of the association and we are not. How do you expect us to be able to do any business at all when you block tfce approaches to us fi'om all sides? But while I will consent BOYCOTTING PARMEIBS' SHIPMENTS 175 for the reason I have stated, to do no more business with Beals, I shall certainly refuse to ^ter into any scheme to rob any man hereafter who is not on the ground to defend himself; I entered into one conspiracy since I was here, and helped^ to rob a poor devil who was a friend of mine out of |60, who sent two cars of com to this market. Since that time I have felt so ashamed of the action that [ have scarcely got the nerve to look at a car of com, but you fellows wanted it done. You said it would help protect your business in the country, which, was true enough, but how in the name of everything that's reasonable, did that transaction help me? That man had sent my firm the only two cars he had ever shipped to this market, and we robbed him. I admit it, and I am ashamed of it. Do you suppose that that man will ever send a carload of corn to my firm, or to this market? Not on your life, he won't I have not only helped you gentlemen to injure my own business * through that transaction, but also to give this Exchange a black eye, and the only benefit that has accrued has been to you big fellows. I certainly shall have nothing to do with smother deal of the same character. If it were not for my relations with Updike I would trot you fellows a heat and teach you a few things, but as I can not do that, I propose going out of the cash business. I will wait until the busi- ness of this Exchange is placed on such a basis that a man can do business with some decency and some satisfaction : without being harassed and hounded by Miller every hour in the day, and without having him come to threaten a dealer with being bulletined and driven out of business for refusing to obey his orders." Every independent dealer who was present expressed him- *self in much the same way, none of them being willing to agree to cease entirely doing business with Beals. The meet- ing, therefore, from the yiew-point of the line house oper- ators, was not a success, and the line house men were far t"firom satisfied with the outcome. They were Ljt long in 176 THE GRAIN TRUST EXPOSED agreeing among themselves that new and severer tactics must be resorted to to bring the offending ones to time. We were left in the dark for only two or three days as to what the plan of their campaign would be, for, within that time Secre- tary Miller went to J. E. Van Dorn, manager for the George A. Adams Grain company, and said: "Will you pro-mise me that you will do no more business with Rudolph Beals, on the floor of the Exchange?" "Why, Miller," said Mr. Van Dorn, "do you want to exact that pledge from me?". "Because we propose to find out who is with us and who is against us in this contest to protect oi^r business at the terminal end, and the man who isn't with us is against us, and will be so considered." With that Miller took his de- parture Van Dorn then came to me and told me what Miller had said to him. We concluded to keep otir eyes open and await developments. We were not required to wait long. Within ' a very short time the kinky tips of the hair on the head of the Afro- American were protruding from the wood pile. We learned that Miller had called upon every independent re- ceiver having a membership in the Exchange, and doin:^ business on the floor, and had told them that all who did business with Beals, either selling to or buying from him, would be considered just as guilty and just as unfriendly as he. Were Beals bulletined — which he would be—- those doing business with him would also be bulletined. This ugly tlireat had the desired effect. While no formal meetings were held to discuss 1^ situation, there were little private confabulations being held on the floor of the Ex- • change daily. Bewsher and the Junior Tawmley were ener- getically caucusing with Peck, Cowgill, Updike, OampbelJ, Westbrook and others, and at the same time had their ordeta in for specially constructed screws of extra length, where- with they proposed to fasten the lid of Beals' coffin so ever- lastingly tight that it would be impossible for him to get out BOTOOTTINQ FARMEES' SHIPMENTS 177 after once they had gotten him in. We little fellows, when we came -fully to realize the meaning of this moveme;>t, were greatly agitated. We understood its far-reaching im- port, and knew that our future in the grain bustuess ^>'ould largely depend on the outcome of this contest. Some time Iprevious to this my partner and myself had finally decided as to what we were going to do, but we were naturally anx- ^us to have all the other independent dealers stay with us. It was distinctly disappointing, then, to find that when the show-down came there were only two companies beside our OAvn ihat stood firm. Those two were the Exchange Grain company and the George A. Adams Grain company. The other independents all went with the big line house men, and through moral cowardice refused to have anything to do, not only with Beals, but with any one transacting busi- ness with him. The next day there came to me young Twamley, the mov- ing spirit in the firm of J. P. Tawmley & Company. He is a decent sort of yoting chap, who ought to have a promising future, but was owned, body, soul and breeches, by the trust. With tears streaming down his cheeks, in a volume that threatened to cause an overflow of the "Big Muddy," he said between sobs: "Tom, I am awfully sorry. You may hear of me saying some very naughty things about you, but when you do let it go in at one ear and out the other. I like to do business with you, and will do it when I am able, but you know I have got to be careful." "Tawmley," I said, "this is going to be the fight of my life, and you have got to be either for me or against me. There is no middle ground. You will confer a great favor on me by telling me now, frankly, which side you are on, and then stay thexe. For God's sake, don't be tossing from one side to the other like a vessel on a stormy swept sea." He said merely : "I will see you again," and walked away. He knew deep down in his heart that I, and those few who 12 178 THE GftAIN TBUST EXPOSED were with me, were right I could not help but feel sorry that a young man so talented as he, so early in life, should stultify his manhood by crawling about to do the bidding of men who cared no more for hira than does the duck for the water that runs off his back. And there were others just like him. On the 19th day of August, James Alderson and George Copeland walked into my oflflce and introduced themselves. They said they represented the Elgin Elevator company at Elgin, Nebraska; that they were not in the grain business at that point just yet, but would be in a short timer. Mr. Copeland gave me a part of the history of his experience in getting his company established at Elgin. Soon after they liad completed the organization they made application for a location on the railroad right-of-way to erect an elevator. AVeeks and months came and went with no tidings of any kind concerning the fate of the application. The Nye- Schnei- der-Fowler company and W. F. Hammond & Company owned the only two elevators at that point, and as the Nye- Schneider-Fowler company were the owners of a big line of liouses on the Chicago & North-Western, the olflcials of that road were mighty chary about handing out sites to farmers' organizations. They were willing and anxious to aid the farmers in getting their grain to market, but the farmers must have nothing to do with the grain after it got to the nearest railroad station. Well, the promoters of this Elgin company kept on wait- ing for word to come from the powers that be, granting them permission to begin work on their elevator. Farmera, mer- chants and bankers had paid for their stock; the money was in the bank, subject to check, to pay for all bills that might be contracted for material and machinery to be used in the building. On the morning of the Fourth of July, the farmers were early astir. The boys and girls had been eagerly looking forward to the dawn of that glorious day. When the chores BOYCOTTING FAEMEES^ SHIPMENTS 179 and morning's work were done, the farmers hitched up their carriages, and with their families dro^e away to the grove, where the nation's natal day was to be celebrated. They sat on the rough boards, under the shade Of the trees, and heard the band play that old familiar air : "America," "My coun- "try 'tis of thee, sweet land of liberty," etc. Presently the chairman, of the celebration announce the reading of the Declaration of Independence. How the farmers sat listen- -ing to every word, paying especial attention to those lines of that immortal document which declare that all men are created equal, endowed by their creator with certain in- alienable rights, among which are life, liberty, and the pur- suit of happiness. Again the band played, this time the "Star Si>angled Banner," and the audience rose to its feet to join in the refrain : "Long may it wave o'er the land of the free and the home of the brave." The orator of the day was introduced. Eeaching down and taking a firm hold upon the American Eagle, he proceeded to place him upon the topmost pinnacle that his fervid imagination could con- ceive. He spoke of the glories and grandeur of a country where every man has the God-given right to follow the dic- tates of his own conscience and his own judgment, and en- gage in any legitimate 'business he may see fit. He lauded this lajid of broad and free opportunity, where class distinc- ticms were all leveled to the ground and where the rights of every man were equal to the rights of any other man. Then after the celebration was at an end, these farmers returned to their homes. When the chores were done they sat with their wives and children on the front porch, and explained to the^ little ones who were too young to under- stand all that the orator had said — what was the meaning of the day. And the very next day they received a letter bearing date July 3, from the railroad officials — the letter they had been so long expecting — and that letter ii^ormed them that no space could be granted them at the station of Elgin for tlie erection of their elevator. 180 THE GRAIN TRUST EXPOSED The sturdy farmers at Elgin refused, however, to be satis- fied with this. They sent a committee to see the officials of the railroad, and to tell them that unless a site was given them at once they would immediately begin the erection of ^an elevator on private ground, and would expect the i-ailroad to stand the expense of hauling their grain from the elevator ' to the cars. Then they bought six carloads of stone to be used in the foundation. When the stone came, and not until then, would the railroad officials believe that these farmers meant business. Then the general manager of the railroad with the president and secretary of this farmers' organiza- tion came to Omaha, and also summoned Frank Fowler of the Nye-Schneider-Fowler company. General Manager Bid- well of the Nebraska and Wyoming division of the Chicago & North- Western railroad, then informed Fowler that he could either sell to these farmers the elevator belonging to his company, or the railroad would give thean permission to erect an elevator on its right-of-way. After much bickering and dickering, Fowler put a price of ^9,000 ujKjn his elevar tor. The farmers accepted it, , paid the money, and took possession, and so these farmers were at last upon their feet. They would soon be ready to do business for themselves, and they were now looking for some one to handle their grain and look after their business at the terminal end. I informed them that the Worrall Grain company would gladly accept their business and would endeavor to so deal with them that the mutual relations would be pleasant and remunerative to both. They said they had been told by those high in railroad circles that they might not be able to dis- pose of their grain at as good a figure in the terminal mar- kets as those who belonged to the Nebraska Grain Dealers association. They presumed that they would And out in the course of time whether this was true or not. I told them, plainly, that they would doubtless meet with some very stub- bom and bitter opposition. They said they were ready for it, and would appreciate whatever our firm could legiti- 'UNCLE REUB" .SCHNEIDER OFF ON A VACATION. (By courtesy of the Omaha World-Herald.) H. L. ADEN'S ELEVATOR AT RISING, NEBRASKA. Which was bought by three corporations, belonging to the trust, " to bring about peace and harmony"— by allowing it to stand idle. ■ *- *-- :-*% ■ •■:;»■ . - ■ . .* ■■'-*'*S? ■■'-■*';••- J FLOYD J. CAMPBELL, Secretary of the Nebraska-Iowa Grain Company. BOYCOTTING FARMEKS-* SHIPMENTS 181 mately do for them. With, that they bade me good day, walked out of the office, took the afternoon train, and re- turned to their homes at Elgin. On the 15th of September, early in the morning^ Secretary Miller came hurrying into our office with his face all flushed. It was plain to be seen that he was laboring under great ex- citement. He said: "You have coming to vou from the" farmers' elevator at Elgin, Korth-Western car number 35740, loaded with oats. You won't think of accepting and handling that consignment, will you?" I said: "Miller, *we haven't as yet been notified' that this car has been consigned to us. After we receive notice it will be time tp discuss this matter. The president and secret tai'y of that elevator company were here to see me about a month ago, and I told them then what we would do. Since that time we have heard not a word from them. Just as soon as we receive any word from them I will let you know." He thanked me and went back to his office. In the afternoon of that same day, the mail brought us a letter from the manager of the Elgin company, giving notice tha.tthey had consigned to us, to be handled oif their account, this car of oats. I took the letter up to Miller's office. As there were some men in there talking with him, I called him outside and saidr • > _ < "You were right. The Elgin , Elevator company has shipped thatvcar to us. -Here is the notice just received through the mail." "What are you going to do about it?" he asked. 'We are going to handle it to the best aa^tentage, and so- licit other shipments fropa them. We will do all the ""busi- ness we think we can. Why should we not? They paid a bi"' price for their elevator, and they are anxious to get a part of their money back. , ^ "I happen to know," replied Miller, "that they are incor- porated for only 110,000. They paid $9,000 for their plant which leaves them with only |1,000. If we can make them 182 THE GRAIN TEUST EXPOSED do business at a loss and lose this $1,000, the Nye-Schneider- Fowler company will buy their elevator back from them for less than half what they paid for it, inside of a year, but this can't be accomplished if you assist them and help them to make money." I said: "Miller, does Frank Fowler approve of such a scheme as this, mapping out a highway robbery, in broad daylight, in a state that boasts the smallest per cent of illit- eracy of any state in the Union?" He said: "1 haven't talked with him, but you know enough aljout the association to know we have got to combat these farmers' organizations all along the line, in every way M^e can. If you are going to be on their side we will do the same thing to you we did to Beals the other day." I answered: "Mind what I say. You did that over the protest of the president and a majority of the governing committee, and you will see the day that your action will be regretted by yourself and by the members of the association long after it has ceased to exist. Do not forget this. Mr. Bell and I have tried to impress this fact on you, time and time again." I went back to my office and again read the bulletin that was mailed to the members of tie organization under date of Septemjjer 9, 1904 : "CONFIDENTIAL BULLETIN NO. 15. "September 9, 1904. "To the members of the Nebraska Grain Dealers assodalion : "Pursuant to the objects of this association, it is my duty to inform you of the following facts : "There has been considerable irregular and farm- ers' business seeking an outlet through the Om€iha market Most of this business has been cleared by sale or consignment, through the Nebraska Hay and Grain company, of which Mr. Eudolph Beals is BOYCOTTIKG FAEMEES'' SHIPMENTS 183 manager. Mr. Beals has a copy of the directory of the regular dealers of tliis state, but asserts his right to do business with ANY AND ALL who may sell him or send him grain on consignment. "It is my opinion that you Avould wish to be made acquainted with this disposition on his part so that you could judge as to the best course to pursue in your future actions. "Yours truly, "H. G. MiLLBE, Sec." In a couple of days my carload 6f oats from the farmers' elevator at Elgin showed up, and g, sample was taken to the trading floor. The big fellows had been notified and had been given the number of the car. They shied clear of the grain, and refused to make any kind of an offer for it. They said they didn't want it and wouldn't have. it. Our firm succeeded, however, in selling the grain for its true worth and value to one of the independent dealers. ? . In the afternoon Miller came to see me again, and wanted to know whether or not we were going to continue handling sh^ments from these farmers' elevator companies. I in- formed him that we were. N. B. Updike then invited me to come over to the Bee building and talk the question over with the dealers having their offices in that building. At first I refused to go, but upon second thought, concluding that it would do no harm, I went over to the private office of F. S, Cowgill, manager of" the Trans-Mississippi Grain company. There were soon as- sembled there, E. S. Westbrook,. S. J. Brown and N;B. Up- date, and the trouble began. Oowgill and Westbrook opened up by telling me what they could and would do to our firm. .They said that the attitude of my firm was going to disturb prices in the country, and so damage their business. I re- tc«'ted that if they wpre injured the farmer who raised the grain would be benefited, "and that's too bad, isn't it?'- I ai^ked. Then I added : ! 184 THE GRAIN TRUST EXPOSED "Mr. Cowgill, you told me what you fellows are going to. do. You say you won't do business with my company. I can't compel you to, and 1 am very sorry,- This is a young market, and we need all the competition we can get. The more buyers we have the more competition there should be. Now sir, you have been frank in what you have said, and I will be equally frank. My firm is going to solicit and do business with everybody, every concern, company, corpora- tion, or individual, be he blue, black, or white, that has an elevator and can load grain into the cars as others do. I trust you understand that. You mustn't think that by swell- ing up to twice your normal size you can frighten me. You may possibly be able to" do some of the things you boast of, but you can't do all of them all the time." Before this poAvwow was concluded N. B. Updike was called out of the room. Then there was made an effort to fix things up so that we could all do business together. After a great deal of talk, Mr. Cowgill said: "We will do business with you over on the floor of the Exchange, and will buy anything you have to offer if we can agree on a price, that comes from regular dealers, but we A\on't buy anything that comes from these farmers' elevators and irregular dealers, if you will let us know when you have shipments coming from them." I said : "All right, we'll do that We'll act square about it." When I left this meeting I walked over to Updike's office and told him what had been agreed upon.. He said that he was glad of it. ' "But Avhat will we do with this grain coming in here from these 'irregular' shippers?" I said. "None of you fellows will buy it of me, and Ave are unable to eat it. So Nels tdL me, will you, what are we going to do -^ith it?" "I don't know," he, said. "I would like to buy it myself, but I can't. I Avould do just as you are doing if I could, but I can't. You know how I am tied up with this bunch here^ BOYCOTTING FARMEES^ SPIPMBNTS 185 •with our offices on the same floor, and we have to do a grbat many things we don't want to to preserve peace and harmony. I. have told Peck and Cowgill both that they are wrong, but you know Ed Peck, and know what his environments and surroundings are. He has never Tun a country station as you and I have, and bumped up against the 'real thing.' Consequently, he does not know. It is the same with Oow- giU." j-^How about Bewsher?" "He does just as Ed Peck tells him to, and tells Miller just what to do, and when he must do it" I said "Good-bye" and went away. The next morning there was a noticeable difference. The Trans-Mississippi Grain company, the Updike Grain company, and the Omaha Elevator company all showed a disposition to do busihess with our company. I was true to my promise, and whenever we had samples of corn that came from "irregular'^^ship- pers, told them, and they wouldn't as much as look at the sample. , At this time our firm was doing business with only one "irregular" concern, but we soon were getting consign- ments from the Eulletton Elevator company at Fullerton, Xebraska, another "irregular" house. Secretary Miller had the information that these cars were coming before we did, and another confei^ce was held between him and myself. The same old arguments were used on both hands, and we ■both, stood firm. A new contest ensued. One day we offered for sale a carload of rye coming from .the farmers' elevator at Fullerton, and neglected to tell the purchaser that it was from an "irregular" shipper. Then there was trouble. A hasty meeting was held, and from that time on our relations with other members on the floor be- came more and more strained. Our company grew more vig- orous and enterprising in seeking outlets in other markets, and sold here, there, and yonder. In time these other outlets were also blocked against us, with the exception of one or two independent receivers. Oux;^ customers on the floor of 186 THE GRAIN TEUST EXPOSED the Exchange were few. Every member of the Exchange Avho was also a member of the Nebraska Grain Dealers asso- ciation had ceased making us any bids for grain. We were receiving bids from exporters and other big dealers, how- ever, and were selling to the same firms they were, for the same money. Then, all of a sudden, these bids stopped coming. These exporters and dealers were all at once out of the market, and didn't care to bid for anything we had to offer. I thought it strange and went to Chicago to see and talk to these dealers. I found that a committee had been there and talked up a deal to prevent- them from bidding on our grain. A member of one Chicago firm that does a large export busi- ness told m'e he had never entered into an agTeement with any one that he disliked as much as he did this ona "But what could I^do?" he said. "Ilere was a committee repre- senting firms that could sell our company 100,000 bushels to your 1,000, asking and demanding that we withdraw our bids and cease doing business with you, or they would cease to do business with us, and so we were compelled to 'knuckle under.' " I now come to the end of my story, by relating the sad- dest part — the part that has caused me more real pain than anything that has occurred in my business career. The day was set for the holding of the last annual meeting of the Nebraska Grain Dealers association. I say the last; I do not believe there will ever be another. I fully intended to go and miike a statement to the members. The president, James BelJ, ever since my embarking into this business, had said he was a friend of mine, and I believed him. He came to me in. the forenoon, and said : "I want to see you either in an attic or a basement, and have a talk with you before tliis meeting." After a little I told liim I was ready and we went down into the basement. BOYCOTTING FAEMEKS^ SHIPMENTS 187 There Bell said to me : "Tom, afe tou gqing to the meet- ing?" I said: "Yes." He said : "Doii't do it, for Bewsher and Miller have got the deal all plugged up. If you go you will be humiliated and probably insulted. They have done, and are doing you lots of damage. ,1 dislike to say this, but it is the truth. I told you we would go out of office together. I will not stand for reelection. Bewsher doesn't want me for presi- dent because he can't run ma But I don't care anything for that. I know that I have some pretty firm ideas and notions in my head. What you have done up to the present has my sanction, but the majority don't think as I do. Some of them are very bitter, and so it has come to this: I must either stand by you and give up the association, or stay by the association and surrender my' business relations with you. Since it has coine to making a choice between you and the association, I will be compelled to stay by the asso- ciation." "Am I to understand, Mr. Bell, that you won't do any further business with me or my company?" ^^ "I won't put it jusl.. that way, but in all probability it won't be as eixtensive from now on." Promising to see me later he left. I have seen Mr. Bell since that time but once, and then in his office, ^t his home town, David City. My feelings were hurt. I felt badly. Here was a man whose judgment^ and manhood I had highly esteemed telling me that he must do the bidding of the combination and pool. Our business felations ended with that conversation, but no word or, cen- sure shall ever fall from my lips against James Bell, or his son Sam, let come whalf may. 188 THE GRAIN TRUST EXPOSED CHAPTER XVI I APPEAL TO THE COURTS I have now given the reader of this volume, as truthfully and frankly as I know how, a history of my connection with the grain trust in Nebraska, and have told everything I know concerning its methods that is of general interest and im- portance. I have told of my embarking in the grain business in a small way, of the discouraging and uphill fight I made to be able to keep free of the pools, and combinations ; how after: months of efforts I was compelled to surrender and be- come a member of the trust; how in connection with others I organized a corporation that played an important part in the management of the trust. I have told of the part I played personally in the formulating and carrying into execution of plots and schemes to further the trust's interests. I have told how I lost sympathy with the trust, and why; how I grew less and less inclined to participate in its lawless machinations. I have told of the organization of the Worrall Grain company; of the independent policy that it pursued; and of the fight made upon it by the trust in consequence. ~ When I helped organize the Worrall Grain company I be- lieved and I continued to believe until about six months ago that I and those associated with me would be able to hold our own against'the members of the ti*ust. Had the trust been willing to allow us the privilege of doing business with independent shippers who own and operate elevators and loaded into cars the grain they bought, without bumping me at every crook and turn of the road, I would still be devot- ing my entire time and attention to the grain business. I would not now be collecting evidence to be used in a suit now pending against corporations and individuals belong- ing to the trust. Our members asked for this privilege more times than once from the secretary and leading members of I APPEAL TO THE OOU.KTS 189 the trust, but deaf ears were turned to our prayers. The trust grew daily bolder and more aggressive in its nefaripus work and its determination to f(^rce our firm as independent ' dealers to the wall. Even while this fight was being made upon us I continued to hold agreements and forfeits posted in my ha,nds between members of the Nebraska Grain Dealers association and others looking toward the stifling of competition, by arbi- trarily fixing prices and by arbitrarily dividing amongr so- called competitive dealers the purchases of grain. The members of the trust realized that these agreements remain- -ing in my hands were dangerous, and I knew well enough that as important evidence they were keen-edged weapons to cut through my opponents' coats of mail. It was a little surprising, therefore, when in Mayy 1905, the trust had the audacity to make copies of tlie letterheads of our firm and on these to print a letter signed with the name of our company, without authority, which letter was sent broadcast ovefr the state for 'the sole purpose of destroy- ing our business with the grain dealers of Nebraska. I knew nothing of what had been done until the Monday morning following the mailing of these fraudulent letters, when some of them came back to us, sent by friends and customers out in the state, asking an explanation. These forged letters were mailed in envelopes that bore the Omaha postmark and dated May 19, 1905. For almost a year our firm had battled with the trust, aifd it now began to look as though the trust was going to be the victor. Its'members had ceased to do business with us on the floor of the Exchange; they had prevented us from being able to dispose of our grain to the best advantage in the ter- minal markets at Chicago, St. Louis, Kansas City and else- where; and had passed the word along the line to grain buyers out in the state to consign no- grain to us. And now, having finally surreptitiously obtained a copy of our letter- 190 THE GKAIN TEUST EXPOSED head, they had had fac-similes made and upon them had sent out letters designed to ruin our business. When this last information came to me I said. "I can not, single-handed and alone, combat this gigantic trust; it has left me but one thing to do. I must either admit defeat and quit like a whipped dog or I must ask the strong arm of the law to interpose to compel my enemies to quit their unlaw- ful practices or suffer the^consequences." This forged letter was the last straw that broke the camel's badv. On the 23d of May I laid the entire matter before our attorneys, Jefferis and Howell, and they at once began the preparation of the petition for the action of the Worrall Grain company against these members of the trust: The Omaha Elevator company, Omaha. Trans-Mississippi Grain company, Omaha. Updike Grain company, Omaha. Nebraska-Iowa Grain company, Omaha. Westbrook- Gibbons Grain company, Omaha, Crowell Lumber & Grain company, Blair. Nye- Schneider-Fowler company, Fremont. Nebraska Elevator company, Lincoln. Central Granaries company, Lincoln. Hayes-Eames Elevator company, Lincoln. Ewart-Williinson Grain company, Lincoln. Evans Grain company, Lincoln. Duff Grain company, Lincoln. W. H. Ferguson, Lincoln. Reuben B. Schneider (alias Rudolph), Fremont. Edward Porter Peck, Omaha. Horace G. Miller, Omaha. Augustus H. Bewsher, Omaha, Nelson P. Updike, Omaha. Frank S. Cowgill, Omaha. Floyd J. Campbell, Omaha. Edwin S. Westbrook, Omaha. Christopher 0. Crowell, Jr., Blair. I APPEAL iO TSB COtBTS 1$^ Bay Nye, Fremont. Frank Fowler, Fremont. John B. Wright, Lincoln. Frank E. Ooe, Lincoln. William E. Morley, Lincoln. Frank Levering, Lincoln. "Edward Slater, Lincoln. George S. Hayes, Lincoln. Ernest Eames, Lincoln. Step'hen Ewart, Lincoln. Richard Wilkinson, Lincoln. John T. Evans, Lincoln. Nicholas A. Duff, Nebraska City. Gifford J. Eailsback, Ashland. W, B. Banning, Lincoln. E. N. Mitchell, Lincoln. The action was for $128,600 damages alleged to have been sustained by the boycotting and bulletining of our firm. It took some time for us to obtain the necessary facts, as we had to have in hand before the suit was filed the written' ' documents to be used in evidence. • When matters had reached this stage I, was not at all, surprised to find the trust endeavoring to get back from me the illegal contracts made and forfeits posted by certain of its members that had been posted with me as stakeholder. On May 28 Mr. Bewsher came to me and asked for the forfeit and agreement his company had entered into with H. L. Aden. The next day I heard from Aden, as follows : "Raymond, Nebraska, May 28, 1905. "Tom Worrall, Omaha, Neb. "Dear Sir: "We have agreed with the Omaha Elevator com- ' pany to have the flOO that you hold in trust for, us and them to be returned, so you may send us a draft for this amount, less exchange, and Mr. Bewsher 192 IBB OEAIN TKUST EXPOSE® will call on you for their portion. You may giv6 the agxeement to him, as we have a copy. We would not have you think that we are, by this means, dis- solving the agreement. Am only taking up the for- feit, as we do not think it necessary. "Yours very tnily, "H. L. Aden.'^ Immediately on receiving this, letter I took it to our, at- torneys and asked them what we should do. They asked me if I had the agreement and money in my possession and I told them I had the agreement and $100 in money, the Ne- braska Elevator company or J. B. Wright having the other |100. My attorney then answered: "We advise you to keep this money and agreement. Do not think of giving either up. This is a dynamite bomb that Avill carry death and destruction into the ranks of the mem- bers of this unlawful and unholy organization. Don't you think of giving it up." Acting on this advice I refused to comply with the de- mands, and concluded to hold the agreement for a while and await developments. On the evening of the 15th of May our petition had been prepared, was signed, and re^ady to be filed. Before" filing it, however, I wanted to let the enemy know what it had to expect. Our attorneys agreed with me that this would be a proper course to pursue and I accordingly called, Secretary Miller into my office. There, in the presence of witnesses, I said to' him : "Mr. Miller, I am glad to see you back in Omaha. I have been waiting for some time for you to return. During the past eight months you have caused a great many measly, mean, ornery, under-handed things to be done that are no credit to you and will do you no good. You and the mem- bers of the Nebraska Grain Dealers association have hounded my partner and myself ever since the 7th day of last July. You have made things mighty unpleasant for ns and have 1 APPBAI, to TSB COURTS 193 cost US a great deal of money. You have resorted to schemes that are damnable. Now it is my turn, and' in a strictly legitimate way I propose to make your association a great deal more trouble tlian you, with all your dishonest and dis-. honorable efforts, have been able to cause us. "Before the sun sinks behind the western hills on Satur- day we are going to file a suit against you and others. This first shot is nothing but tlie explosion of a firecracker com- , pared with what is to come. The big guns are in the rear, loaded to the muzzle, so take warning. Get i^eady for the greatest legal battle you ever mixed up in." It was easy, to see that Secretary Miller . was a greatly surprised and badly agitated man. His face was white and . his tongue speechless. Finally, when he said nothing, I added "That's all." And he then, at la^t, was able to reply as follows: "I am very much obliged to you for this information and appreciate your kindness. Good-by&" With that he left me, and I have never had any conversation wit4,him since. Saturday morning, June 17, the papers in our suit were filed in the district court of Washington county, Nebraska. The stniggle there begun is still waging and will continue, if my life is spared, until those who are responsible, for the wrongs that have been done have been made to pay the penalty. n The proceedings instituted against the trust in the Ne- braska supreme court by Attorney General Norris Brown are far more drastic in their intent than is the suit instituted' by our company in "Washington county. For with the at- torney general the leading members of the grain trust must fight to retain their property, their franchises, and even the names of their corporations, while our suit is merely for damages. After these suits were under way I felt that it would be an act of simple justice to the grain trust and to the farmers of Nebraska as well as to myself to make public a plain and 13 194 THE GEAIN TRUST EXPOSED unvarnished statement of the facts concerning the history and inside -workings of the trust. I hope that none will be so uncharitable as to tliink that the writing of this book was a task which I enjoyed. I hope I will be believed when I say that the writing of the book has been an unpleasant task. I would much prefer to live on earth in peace and harmony with all men I am compelled to meet in a business .and per- sonal way. I neither ask nor seek vantage ground over any-, one, but I am not willing to concede to anyone else an undue and unjust advantage over me. I have been willing to work in a spirit of equal rights to all and special privileges to none, but this has not been true of those who constitute the Nebraska Grain Dealers association. I feel that I can say to them now: "For years I worked and worked hard, days and nights and Sundays, in season and out of season, for your interest. When the time came when I was no longer satisfied to do your dirty and unlawful work, and decided to make a change, you were not willing to grant me that privilege. But I knew I had the right to go out and battle for myself in a legitimate way in a legitimate business without submitting to the dicta- tion of men so small and narrow that little children, cold and hungry, could come to them on the streets begging for food and raiment and be repulsed. I therefore attempted to exercise that right; I did exercise it; and I shall continue to do so so long as I have a penny to my name and the breath of life in my nostrils." I would be ungrateful, indeed, were I to close without saying a few words with regard to the attorneys who have charge of my interests in the proceedings against the grain trust — A. W. Jetferis, Frank S. Howell and. Herman Aye. All these gentlemen are able^ tireless workers, ever on the alert, determined and resolute, while at the same time cour- teous and obliging. With these men fighting my battles, and with Attorney General Norris Brown and Hon. J. J. Sullivan looking after the interests of the state, I feel that I APPEAL TO THi; COURTS 195 when these legal proceedings are terminated the grain trust will be overthrown and that the farmers and producers of Nebraska will be freed of its galling yoke. The people" of Nebraska made no 'mistake when, at the general election held in 1904, they elected Norris Brown to be their attorney general. It "may seem strange .to some that such a statement should be made by one who was born a democra,t, who was rocked in democracy's cradle and bred in democracy's creed; one who at all times and under all circumstances has supported democratic candidates for of- fice, including even G-rover Cleveland and Alton B. Parker. But, not as a democrat but as a. Nebraskan, I am proud of Norris Brown and of the record he has made. I am yet prouder of the record I am confident he is still to makfe He is an able, broad-minded, conscientious and absolutely fear- less official. At the time of the .filing of the suit of the Worrall Grain company I was not acquainted with Mr. Brown. Early in the proceedings, however, my attorneys gave me to under- stand that before we should get through with the case I would have ample opportunity to know him well. On July 7 the Lincoln Evening News published an article, the purport of which was that the state might take a hand in the, suit filed by the Worrall Grain compai^ against the grain trust, as the attorney general was watching the case with much interest, and if evidence of the existence of a trust or com- bination in restraint of trade should be secured there was little doubt but what he would take a hand in the proceed- ings. When we read this article my attorneys said to me that we would go and see Mr. Brown when the proper time had come. We concluded taking depositions at Havelock early in the afternoon of- Saturday, July 8. I will admit that I was dis- appointed at the evidence given by such men as Frank Lev- ering, Edward Slater, W. E. Morley, Joseph Whyte and others,. because I knew them and expected them to tell the 196 THE GRAIN TEUST EXPOSED truth frankly. Some of them, in fact, had told me that that was what they were going to do when they went on the wit- ness stand. That th&y should do this was all I asted ; it was all I expected, and I was disappointed. We left Havelock and went to the Royal hotel in Lincoln and sat out in front and rested awhile. Finally Mr. Howell broke the silence by saying, "Let's go up and call on the attorney general. It won't hurt our case in the least. There are twenty millions of organized capital opposed to us, and we have only a few thousand:" I said "All right. I will go first and find out if he is in." I went to the telephone and called the attorney general's office. Mr. Brown answered. I told him who I was and said that my attorney, Mr. Howell, and myself would like an audience with him. He asked if it was about our case, and I atiswered "yes." He said, "I was just ready to leave, as I have an engage- ment T^ith some friends who are leaving the city, but I will cancel that engagement and stay here in the office to see you and your attorney. How soon will you be here?" I an- swered "In fifteen minutes." Mr. Howell and I w'ent to his office. We were cordially received, and without unnecessary preliminaries were in- vited at once to go into the merits of the case. Mr. Brown said : "I do not now nor have I ever posed as a reformer or the son of a reformer, but I am heartily in favor of enforcing every law on our statute books. If the enfox-cement of these laws works a hardship on persons and corporations, the leg- islature ought to repeal them, but while they are on the stat- ute books it is my sworn duty to enforce them and I am go- ing to do so. I have been satisfied, for some time that there is a pool and combination in the grain business of this state, but it has been the na^t thing to an impossibility for me to obtain sufficient evidence to prosecute those who are engaged in it. In fact, until very recently it has been impossible for I APPEAL TO THE COURTS " 197 me to ebtain any evidence or get any facts concerning this matter. I am going to analyze and dissect the t^timony taken by you, and for that purpose I would like to have a copy of it. After I have done this I will be able to tell just what to do and how soon to do it." After remaining in consultation with Mr. Brown for about an hour we bade him good afternoon and left. As we walked away from tbe capitol building neither Mr. Howell nor my- self spoke until we reached the street. I was waiting for him to open the conversation and presume he was waiting' for me. Finally I asked: "What do you think?" He answered:' "He means business and no pressure can be put on that man to stop him from doing his duty. At the proper time we will bring to him all the. evidence we have and go over it with him." We next called at Mr. Brown's office on the 18th, 'imme- diately after Judge Sears had signed the order transferring the case from the district to the federal court. Mr. Brown was absent in Omaha. We went to Omaha the next morning and called at his hotel to find that he had just taken the train for Lincoln. We caught the next train back to Lin- coln and found him in his office. We sat down and went over the testimony together. When we were through he said : "This is not for repetition at this time, but I am going to prosecute the members and corporations that have been do- ing this. I will begin original action here in the supreme court, ask for a restraining ordfer, and commence quo war- ranto proceedings at the same time. What I want is re- "Bults, and the quickest way to get them is the best way, and I think this is the quickest." This was the attitude of the attorney general at that time and I believe is still his attitude. He did not commence his suit with the expectation or intention of. making a "grand- Btand play," as some might call it, but for the purpose of [^ringing relief to the hard-working farmers and producers 198 ' THE GEAIN TBUST EXPOSED of Nebraska. He was animated by an honest desire to res- cue them from the toils of the grain trust. He did his duty without having had any pressure brought to bear upon him and without solicitation. Weighing my words, I say that the people of Nebraska, asking nothing more than justice, and who will be satisfied with nothing less, may safely place their trust in Norris Brown. A LAST WOBD WITH THB BEADES 19§ CHAPTER XVII A I^ST WORD WITH THE READER On JulJ^4, 1776, our fathers said :- "We hold these truths to be self-evident; that all men are created equal; that they are endowed by their Creator with certain inalienable rights; that among these are life, liberty, and the pursuit of hap- piness." ^ When they adopted the Constitution of the United States, April 17, 1787, they said : "We, the people of the United States, in order- to form a more perfect union, establish jus- tice, insure domestic tranquillity, provide for the common def raise, promote the general welfare, and secure the bless- ings of liberty to ourselves and our posterity do ordain and establish tliis Constitution for the United States of America," The immortal Lincoln, at Gettysburg, gave utterance to .these words: "Fourscore and seven years ago our fathers brought upon this coiff inent a new , nation, conceived in lib- erty, and dedicated to the proposition that all men are cre- ated equal." _ Our schools, colleges and universities have been teaching these ideas and truths enuncia,ted by our fatJiers, and have been inculcating in the minds of the young the belief that in this country of ours every person is to have an equal op- portunity and equal rights with every other person. But when I consider the conditions of the grain business in Nebraska and know as I do that similar conditions exist in other lines of business, I am prompted to ask, if such methods are to continue to dominate and control our busi- ness affairs, why should we longer teach our boys that they are to have equal opportunities in the battle of life? Why not teach them that, to succeed in business, they must sacri- fice the independence of true American manhood and be- come the pliant tools of unlawful combinations and con- 200 THE QftAlN «ltTST EXPOSED spiracies organized to extort, by wicked schemes, a portiotl ; of the products or earnings of others, and whose only object is money? Were our fathers wrong? Did they dream of liberty and build to reach Jt in vain? I answer "No!" Trusts, combinations and conspiracies in restraint^ of trade, crushing out the best American manhood, must crum- ble before the bar of public opinion. The forerunners of. , restored competition, which is the life of trade, the apostles of a new manhood, are beginning to make plain E8 201 tipon it too much as a means of rewarding selfish and de- signing politieitins who wrap the flag about their corpulent bodies and call upon the dear people to rally round it. It is so easy~ so simple a thing for the people to. get what they want, to win and hold all their J-ights and further the greatest good of all if only they will awaken to the situation, fling partisanship to the winds and sef'about in a sensible way exercising their privileges as citizens. And yet how slow they are to do it! How they allow themselves to, be coddled and played upon by cheap politician^ and self-s^fek- ers! How passively they will submit to. injustice that. they know to'exist, in the na,me of friendship^ of party, of another day in the cornfield! The ballot is the freeman's mightiest weapon. It is a weapon more p<3werful than dynamite, keener than the edge of a Damascus blade, more compelling than the biggest of "Big Sticks," as commanding as the voice of God. This .weapon the people, through centuries of blood and awful /hardships, wrested from their oppressors, and they have it in their own hands. They have but to use it, if only with half the intelligence and accuracy that the hunter uses his rifle, and with it they can bring turiibling to the eaxth all the gigantic wrongs and oppressions that (permit the favored' and unscrupulous few to reap the products of their sweat and toil. And yet this mighty weapon, spiked by partisanship, blunted by prejudice, padded with ignorance, too often is iinade as ineffective as a popgun in the hands of a little child. It is a sad and bitter thought, this thought of the people, with this tremendous force against which not even the most powerful of wrongs could stand for a year, misusing it, or using it not at all. The cohorts of wrong are banded to- gether. Their weapons, weapons of craft and avarice and trickery and crime, are but as feathers compared with those with which the people are equipped. But how wisely and "'carefully they use those feathers! Standing shoulder to 202 THE GBAIN TEUST EXPOSED shoulder to protect their unholy interests and safeguard their unjust privileges, they cunningly divide the people by prejudice and partisanship and set them to fighting among themselves over little things, while they, the big robbers, the sanctified thieves, make off with their plunder! Consider, for a moment, this case of the grain trust I- have told the story of how, in the Nebraska legislature of 1903, that trust defeated the measures that were designed to clip its claws. But I have not told how, in order for it to be possible to do this, that trust had to join hands with the railroads and other great interests long before that legis- lature was elected to dictate party nominations, choose party leaders and formulate party policies, ahvays looking toward the attainment of its own ends and aJways contriving to procure the people, the great, big-hearted, careless, deluded people, to do its bidding in the name of party ! Did you ever stop to consider how much this grain trust has cost the farmers of Nebraska? 1 have no desire to worry the reader with iigures, but there are a few I can not help submitting. In Nebraska the grain trust has been all-pow- erful. In Kansas it has been weak, and comi)etition has been kept aliva Do you know how much money that com- • i)etition saved to the farmers of Kansas? Do you know how much the lack of competition cost the farmers of Nebraska? Consider these figures: In 1903 Kansas raised 87,219,557 bushels of wheat at a farm value of 59 cents a bushel. Nebraska raised 42,157,560 bushels of wheat at a farm value of only 54 cents a bushel. Kansas raised 171,687,014 bushels of corn at a faim value of 36 cents a bushel. Nebraska raised 172,379,532 bushels of corn at a farm value of only 28 cents a bushel. HAD NEBRASKA CORN AND WHEAT BROUGHT THE SAI\[E PEICE BROUGHT BY KANSAS CORN AND WHEAT, THOSE CROPS FOR THAT SINGLE YEAR WOULD HAVE BROUGHT THE NEBRASKA FARM- ERS $15,898,240 MORE THAN THEY DID BRING! A LAST WOKD WITH THE HEADER 203 IN 1904, HAD NEBEASKA CORN AND WHEAT BEOUGHT THE SAME PEICE AS DID KANSAS GRAIN, THEY WOULD HAVE BROUGHT TO THE FARMERS 121,504,945 MORE THAN THEY DID BRING! Why should not grain raised in Nebraska bring as good a price as grain raised in Kansas? Nebraska grain is as ac- cessible to the railroads, it is as near-t a fact that the Central Granarios company and the Nebraska Elevator company to your knowledge consti- tute and have constituted for more than a year last past or 208 THE GRAIN TRUST, EXPOSED about that time two members of the general price committee constituted by the Nebrasica Grain Dealers association for the purpose of arbitrarily fixing from time to time the price of grain to be purchased from the farmers in Nebraska? A. 1 decline to answer on the grounds as afores£i.id. Q. Isn't it a fact that the general price committee referred to in the last question consists and has consisted for several years last past to your knowledge of the Omaha Elevator company, the Updike Grain company, both of Omaha, Ne- braska, the Nye & Schneider Elevator company of Fremont, .^ the Central Granaries company and the Nebraska Elevator company, both of Lincoln, Nebraska, "^and that those five members of the price committee fixed the xjrice to be paid by regular elevator dealers to farmers for their grain through- out the state of Nebraska, and a small portion of the state of Kansas? A. I decline to answer as previously stated. Q. And is it not a fact that the price fixed by that commit- tee referred to in the last question sent out by means of cards through agencies stated in the meetings of the Nebraska Grain Dealers association, and according to rules estab- lished by that price committee, and that these prices when so fixed are kno^-n to the regular dealers as card prices, and do you not know these facts from your personal knowledge? A. I decline to answer on the grounds previously stated. Q. Is it a fact that when the grain market fluctuates so much as to compel, in the judgment of the price committee, that committee to make a change in the price to be paid to the farmers for grain, that Mr. A. H. Bewsher, now secretary of the Omaha Elevator company, and Nels B. Updike, presi- dent of the Updike Grain company, according to the usual, understanding by you and this committee and the gen- tlemen named meet in Omaha and call uj) by private tele- phone lines, usually Mr. Fowler, the secretary of the Nye- Schneider-Fowler company of Fremont, and by previous arrangement between you and those parties Mr. Fowler REFUSING TO TESTIFY 209 places the receiver of* the private wire to his ear and the re- ceiver of the Bell Telephone company to the other ear and calls you and your company at Lincoln and that in that man- ner the price to be paid for grain is agreed upon which is to be paid the -farmer for grain and- that the conversations be- tween these parties are by Mr. Fowler repeated from Lincoln to Omaha and from Omaha to Lincoln, and in the event the four mentioned can not agree as to prices tQ be paid that the Nebraska Elevator company is called in as the fifth member to decide ajad fix the price to be so paid, and that the prices paid by th^ regular members or to be fixed by them are thus paid and maintained hf them and have been so for some time past? • A. I ■ decline to answer on the grounds as previously stated. - Q. Is it true that the price to be paid to the farmers for their grain has been and is being fixed by that general com- mittee referred to in previous questions, that the Nebraska Elevator company is then informed of the prices so agreed upon to be paid to the farmers? A. I decline to answer on the grounds as previously stated. Q. Is it true that the members of that committee then confer witli Mr. N. A. Duff, the president of the Nebraska Grain Dealers assogiation and the president of the Duff Grain company of "Nebraska City and inform him of the prices to be paid faipmers for grain in the territory north and west of Lincoln and that Mr. Duff, With the advice of the Nebraska Elevator company, fixes the price to be paid to the farmers for grain in the territory south of Lincoln? A. I decline to answer on the grounds aforesaid. Q. Isn't it true that after the price has been so fixed that the method of communicating those prices to the several price districts throughout the state of Nebraska is to conr- municate the price so agreed upon to several members of the Nebraska Grain Dealers association at various points throughout the state, and -by them in return to communicate 14 - ' 210 THE GRAIN TEUST EXPOSED it to the regular grain dealers in the state in the respective price districts, or groups, over which the several persons to whom the prices are communicated in the first instance, and that Eichlield is one of the points to which these prices are communicated, and from which the price is disseminated? A. I decline to answer as aforesaid. Q. It is true, is it not, that when the prices are so fixed " by the committee you or your company communicate the same by collect messages to Van Buren & Son at Pairbury, and that Van Buren & Son upon receipt of said message send out cards to the agents and operators of elevators on the line of railroad of tlie Kock Islifnd and west of Fairbury, to and including Nelson, Neb., and is not this one of the methods adopted for communicating prices to other parties who in turn communicate to operators of elevators by means of cards on other lines of railroad upon which these parties to whom prices are communicated for distribution are located, and to whom this duty is delegated, and this method is pur- sued by selecting those most conveniently situated upon the several lines of railroad for the purposes in this question? A. I decline to answer as aforesaid. Q. I hand witness exhibit "102," identified by the signa- ture of Owsley Wilson, notai-y public, and will ask you to state if that is not one of the maps prepared by some of the defendants of the general price committee for the purpose of dist;^uting off the state of Nebraska and a small portion of Kansas into groups numbered from 1 to 13 Inclusive and which was used by the price committee for the purpose of designating and maintaining prices arbitrarily and uni- formly within the respective districts indicated on that map? A. I decline to answer on grounds as stated befora Q. The Central Granaxies company has been a member of the Nebraska association for some years last past? A. I decline to answer as aforesaid. Q. Are you a memberof the Nebraska Grain Dealers asso- ciation and if so for how long a time have you been such member? fiEFUSlNG TO TESTIFT 211 A. I decline to answer as stated before. Q. How. many elevators does the Central Granaries com- pany own or operate in the state of Nebraska? A. I decline to answer as stated before. Q. It is true, is it not, that it owns or operates about sixty elevators in the states of Nebraska and Kansas and about forty in the state of Nebraska? A. I decline to answer as stated before. Q. .Is your reason for declining to answer the previous questions based upon the fact that, should you answer them or any of them, your answer would be such that it would tend to incriminate you or subject you to a criminal prosecu- tion for a violation of the laws and the criminal statutes of the state of Nebraska? A. I decline to answer the question on the grounds as here- tofore given. Q. (Question repeated.) A. I decline to answer the question on the ground that it might incriminate ma Q. And do you claim that privilege both for yourself and for the company that you represent, or with whom you are associated in business? A. I decline to answer that question on the ground as pre- viously stated. In addition to these, Mr. Knight of Walton, James Candy of Havelock, J. T. Evans, Frank E. Coe, Edward Slater and E. N. Mitchell of Lincoln, all sought refuge in their legal- right to refuse to testify on the grounds that by doing so they might incriminate themselves.