dU'i .CORNELL UNIVERSITY LIBRARY 924 079 612 051 DATE DUE PRINTED IN USA Cornell University Library The original of this book is in the Cornell University Library. There are no known copyright restrictions in the United States on the use of the text. http://www.archive.org/details/cu31924079612051 In compliance with current copyright law, Cornell University Library produced this replacement volume on paper that meets the ANSI Standard Z39.48-1992 to replace the irreparably deteriorated original. 1997 CORNELL UNIVERSITY LIBRARY CONTENTS ODAPTER I. II. m. IV. V. VI. • VII. N,VIII. IX. X. \XI. XII. ^ XIII. XIV. •.XV. -XVI. r..XVII. XTUI. XIX. XX. XXI. XXII. ^ xxm. ^xxiv. nXXV. ^XXVI. xxvn. sxvni. "there ABE soke" — "THEY AllB LEGION' C0T OFF FEOJI FIRE . . PROHIBITION THAT PROHIBITS .... "SQUARE EATERS" . . . . STRIKISG OIL "NOT TO EXCEED HALF" . . . . "TOU AKE NOT TO REPINE" . . . "no!" . . . . . . "WHO PIPED AND "WHO DANCED . CHEAPENING TRANSPORTATION . SONG OF THE BARREL UNFINISHED MARCH TO THE SEA .... PURCHASE OP PEACE ... "I WANT TO MAKE OIL" STJIPATHETICAL CO-OPERATION . "TURN ANOTHER SCREW" ...... IN THE INTEREST OF ALL . . . . ORDINARY SUPPLY AND DEMAND . . . THROUGH THE WOMAN'S EYES . . . TAKEN FROM THE JURY BY THE JUDGE CRIME CHEAPER THAN COMPETITION. ANOTHER TALE OF TWO CITIES . , . FREEDOM OF THE CITY HIGH FINANCE A SUNDAY IN JUNE . . TOLEDO VICTOR ... "you are a — SENATOR" FOR "OLD GLORY" AND AN — APPROPRIATION . "THE COMMODITY IS NOT SO GOOD AS BEFORE" — CoH "TO GET ALL WE CAN" . . . . ■-n \T PAGE 1 9 20 30 38 ei 73 84 1043c; 118 128 152 166 183 199 212 227 243 257 272 285 299 313 326 341 353 369 389 405 420 IV CONTENTS CBAPTER PAOB --XXXI. ALL THE WORLD TINDER ONE HAT . 432 XXXn. "KOT BUSIHESS". . . . . . 455 '^ XXXm. THE SMOKELESS REBATE 474 vXXXrr. THE OLD SELF-INTEREST . . 494 ^XXXV. AND THE NEW . 516 APPENDIX — PARTIAL LIST OP TRADE COSIBINATIONS, OR TRUSTS . . . . . . . 537 INDEX 545 WEALTH AGAINST COMMONWEALTH BY HENRY DEMAREST LLOYD NEW YORK HARPER & BROTHERS PUBLISHiiRS 1894 URis l;br/\ry 1^-0^ [LO 0,; 1 1 ■- US'-' ■ 1 ■-/ f /# ^% %',.. ^'' ->;/ Copyright, 1894, by Hknby Demaksst Lloyd. ^K rights reMrved. _; '-• ' Ve.^:.:V- ''J K^i WEALTH AGAINST COMMONWEALTH CHAPTER I "theee are noxe' N ATUEE is rich ; but everywheve man, the heir of nature, is poor. If ever iu this happy country or elsewhere — except in the Land of Miracle, where "they did all eat and were filled" — has there been enough of anything for the people. Never since time began have all the sons and daughters of men been all warm, and all filled, and all shod and roofed. Never yet have all the virgins, wise or foolish, been able to fill their lamps with oil. The world, enriched by thousands of generations of toil- ers and thinkers, has reached a fertility which can give every human being a plenty undreamed of even in the Utopias. But between this plenty ripening on the boughs of our civili- zation and the people hungering for it step the " cornerers," the syndicates, trusts, combinations, with the cry of "over- production" — too much of everything. Holding back the riches of earth, sea, and sky from their fellows who famish and freeze in the dark, they declare to them that there is too much light and warmth and food. They assert the right, for their private profit, to regulate the consumption by the people of the necessaries of life, and to control production, not by the needs of humanity, but by the desires of a few for dividends. The coal syndicate thinks there is too much coal. There is too much iron, too much lumber, too much flour — for this or that syndicate. 1 2 ''THERE ARE NONE"— " THE y ASE LEGION" The majority Ifeve never been able to buy enough of any- thing ; but this minority liave too much of everything to sell. Liberty produces wealth, and wealth destroys liberty. " The splendid empire of Charles V.," says Motley, "was erected upon the grave of liberty." Our bignesses, cities, factories, monopolies, fortunes, which are our empires, ai-e the obesities of an age gluttonous beyond its powers of digestion. Mankind are crowding upon each other in the centres, and struggling to keep each other out of the feast set by the new sciences and the new fellowships. Our size has got beyond both our science and our conscience. The vision of the railroad stock- holder is not far-sighted enougli to see into the office of the General Mauager ; the people cannot reach across even a ward of a city to rule their rulers ; Captains of Industry " do not know " whether the men in the ranks are dying from lack of food and shelter ; we cannot clean our cities nor our politics ; the locomotive has more man-power than all the ballot-boxes, and mill-wheels wear out the hearts of workers unable to keep up beating time to their whirl. If mankind had gone on pur- suing the ideals of the fighter, the time would necessaril}'- have come when there would have been only a few, then only one, and then none left. This is what we are witnessing in the world of livelihoods. Our ideals of livelihood are ideals of mutual deglutition. "We are rapidly reaching the stage where in each province only a few are left ; that is the key to our times. Beyond the deep is another deep. This era is but a passing phase in the evolution of industrial Cassars, and these Cassars will be of a new type— :Corporate_C«sars. For those who like the perpetual motion of a debate in which neither of the disputants is looking at the same side of the shield, there are infinite satisfactions in the current con- troversy as to whether there is any such thing as "monopoly." " There are none," saj's one side. " They are legion," says the other. " The idea that there can be such a thing is absurd," says one, who with half a dozen associates controls the source, the price, the quality, the quantity of nine-tenths of a great necessary of life. But " There will soon be a trust for every A DIFFEBENCE OF DEFINITIONS 3 production, and a master to fix the price for every necessity of life," said the Senator -who framed the United States Anti- Trnst Law. This difference as to facts is due to a difference in the definitions through which the facts are regarded. Those who say " there are none " hold with the Attorney-General of the United States and the decision he quotes from the high- est Federal court which has yet passed on this question' that no one has a monopoly unless there is a " disability " or " re- striction" imposed by law on all wlio would compete. A syndicate that had succeeded in bottling for sale all the air of the earth would not have a monopoly in this view, unless there were on the statute-books a law forbidding every one else from selling air. No others could get air to sell ; the peo- ple could not get air to breathe, but there would be no monop- oly because there is no "legal restriction" on breathing or selling the atmosphere. Excepting in the manufacture of postage-stamps, gold dol- lars, and a few other such cases of a "legal restriction," there are no monopolies according to this definition. It excludes the whole body of facts which the people include in their defi- nition, and dismisses a great public question by a mere play on words. The other side of the shield was described by Judge Barrett, of the Supreme Court of New York. A monopoly he declared to be "any combination the tendency of which is to prevent competition in its broad and general sense, and to control and thus at will enhance prices to the detriment of the public. . . . Is'or need it be permanent or complete. It is enough that it may be even temporarily and partially successful. The question in the end is. Does it inevitably tend to public injury?"' Those who insist that " there are none " are the fortunate ones who came up to the shield on its golden side. But com- mon usage agrees with the language of Judge Barrett, because > Annual Eeport Attorney-General of the United States, 1893. * People of the State of New York m. The North River Sugar Refining Com- pany. Supreme Court of New York — at Circuit (January 9, 1889). New York Senate Trusts, 18S9, p. 278. 4 " THERE ARE NONE''—" TREY ARE LEGION'' it exactly fits a fact •which presses on common people heavily, and will grow heavier before it grows lighter. The committee of Congress investigating trusts in 1889 did not report any list of these combinations to control markets, " for the reason that new ones are constantly forming, and that old ones are constantly extending their relations so as to cover new branches of the business and invade new terri- tories." It is true that such a list, like a dictionary, would begin to be wrong the moment it began to appear. But though only an instantaneous photograph of the whirlwind, it would give an idea, to be gained in no other way, of a movement shadow- ing two hemispheres. In an incredible number of the neces- saries and luxuries of life, from meat to tombstones, some inner circle of the "fittest" has sought, and very often ob- tained, the sweet power which Judge Barrett found the sugar trust had : It "can close every refinery at will, close some and open others, limit the purchases of raw material (thus jeopard- izing, and in a considerable degree controlling, its production), artificially limit the production of refined sugar, enhance the price to enrich themselves and their associates at the public expense, and depress the price when necessary to crush out and impoverish a foolhardy rival." Corners are " acute " attacks of that which combinations exhibit as chronic. First a corner, then a pool, then a trust, has often been the genesis. Tlie last stage, when the trust throws off the forms of combination and returns to the simpler dress of corporations, is already well along. Some of the "sym- pathetical co-operations" on record have no doubt ceased to exist. But that they should have been attempted is one of tlie signs of the time, and these attempts are repeated again and again until success is reached. The line of development is from local to national, and from national to international. The amount of capital changes con- tinuall}' with the recrystallizations in progress. ISTot less than five hundred million dollars is in the coal combination, which our evidence shows to have flourished twenty-two years; that V. S. A. . UNITED SYNDICATES OF AMEBIC A 5 in oil has nearly if not quite two hundred millions ; and the other combinations in which its members are leaders foot up liundreds of millions more. Hundreds of millions of dollars are united in the railroads and elevators of the Northwest against the wheat-growers. In cattle and meat there are not less than one hundred millions ; in whiskej, thirty-five mill- ions; and in beer a great deal more than that ; in sugar, seventy- five millions; in leather, over a hundred millions; in gas, hun- dreds of millions. At this writing a union is being negotiated of all the piano-makers in the United States, to have a capital of fifty millions. Quite beyond ordinary comprehension is the magnitude of the syndicates, if there is more than one, which are going from city to city, consolidating all the gas- works, electric-lighting companies, street-railways in each into single properties, and consolidating these into vast estates for central corporations of capitalists, controlling from metropoli- tan offices the transportation of the people of scores of cities. Such a syndicate negotiating in December, 1892, for the con- trol of the street-railways of Brooklyn, was said by the New York Times, " on absolute authority, to have subscribed $23,- 000,000 towards that end, before a single move had been made or a price set on a single share of stock." It was in the same hands as those busy later in gathering together the coal-mines of ISTova Scotia and putting them under American control. There are in round numbers ten thousand millions of dollars claiming dividends and interest in the railroads of the United States. Every year they are more closely pooled. The pub- lic saw them marshalled, as by one hand, in the maintenance of the high passenger rates to the World's Fair in the summer of 1S93. Many thousands of millions of dollars are represented in these centralizations. It is a vast sum, and yet is but a mi- nority of our wealth. Laws against these combinations have been passed by Con- gress and by many of the States. Thei'e have been prosecu- tions under them by the State and Federal governments. The laws and the lawsuits have alike been futile. 6 " THERE ARE NONE"—" THET ARE LEGION" In a few cases names and form of organization have been changed, in consequence of legal pursuit. The whiskey, sugar, and oil trusts had to hang out new signs. But the thing itself, the will and the power to control markets, livelihoods, and liberties, and the toleration of this by the jjublic — this remains unimpaii-ed ; in truth, facilitated by the greater secrecy and comp.actness which have been the only results of the appeal to law. The Attorney-General of the national government gives a large part of his annual report for 1893 to showing " what small basis there is for the popular impression" "that the aim and effect of this statute " (the Anti-Trust Law) " are to prohibit and prevent those aggregations of capital which are so common at tlie present day, and which sometimes are on so large a scale as to practically control all the branches of an extensive industry." This executive says of the action of the "co-ordinate" Legislature: "It would not be useful, even if it were possible, to ascertain the precise purposes of the fram- ers of the statute." He is the officer charged with the duty of directing the prosecutions to enforce the law; but he de- clares that since, among other reasons, " all ownership of prop- erty is a monopoly, . . . any literal application of the provisions of the statute is out of the question." Nothing has been ac- complished by all these appeals to the legislatures and the courts, except to prove that the evil lies deeper than any pub- lic sentiment or public intelligence yet existent, and is stronger than any public power 3'et at call. What we call Monopoly is Business at the end of its jour- ney. The concentration of wealth, the wiping _ontofjthe middle classes, are other names for it. To get it is, in the world of affairs, the chief end of man. There are no solitary truths, Goethe says, and monopoly — as the greatest business fact of our civilization, which gives to business what other ages gave to war and religion — is our greatest social, political, and moral fact. The men and women who do the work of the world have the right to tlie floor. Everywhere they are rising to "a point HISTOUT FltOM OFFICIAL RECORDS 7 of information." They want to know how our labor and the gifts of nature are being ordered by those whom our ideals and consent have made Captains of Industry over us ; how it is that we, who profess the religion of the Golden Eule and the political economy of service for service, come to divide our produce into incalculable power and pleasure for a few, and partial existence for the many who are the fountains of these powers and pleasures. This book is an attempt to help the people answer these questions. It has been quarried out of official records, aud it is a venture in realism in the world of realities. Decisions of coiirts and of special tribunals like the Interstate Commerce Commission, verdicts of juries in civil and criminal cases, reports of committees of the State Legis- latures and of Congress, oatli-sworn testimony given in legal proceedings and in official inquiries, corrected by rebutting testimony and by cross-examination — such are the sources of information. One important exception is in the description of the opera- tions of a great international combination in England, Ger- manj'^, Holland, and elsewhere in Europe ; this has had to be made from unofficial material. The people there are neither economically nor politically developed to the point we have reached in America, of using the legislative investigation and the powers of the courts to defend livelilioods and market rights, and enforce the social responsibilities of industrial power. Full and exact references are given throughout for the guidance of the investigator. The language of witnesses, iudces, and official reports has been repeated verbatim, except for the avoidance of the surplusage and reduplication usual in such literature, and that, to permit the use of the dialogue form, the construction has been changed from the third per- son to the first in quotations from evidence. With these qualifications, wherever quotation marks have been used, the transcription is word for word. Evidence from such sources is more exact, circumstantial, and accurate than that upon which the mass of historical literature is founded. To give the full and official history of numbers of these 8 "TBERE ARE SOXE"—" THEY ARE LEGION" combinations, which are nearly identical in inspiration, meth- od, and result, would be repetition. Only one of them, there- fore, has been treated in full — the oil trust. It is the most successful of all the attempts to put gifts of nature, entire in- dustries, and world markets under one hat. Its originators claim this precedence. It was, one of its spolcesmen says, " the parent of the trust system." ' It is the best illustration of a movement which is itself but an illustration of the spii'it of the age. ■ Combinaliom, by S. C. T. Dodd, p. 19. CHAPTER II CUT OFF FEOM FIEE KoME banislied those who had been found to be public ene- mies by forbidding every one to give them fire and water. That was done by all to a few. In America it is done by a few to all. A small number of men are obtaining the power to forbid any but themselves to supply the jjeople with tire in nearly every form known to modern life and industry, from matches to locomotives and electricity. They control our hard coal and much of the soft/ and stoves, furnaces, and steam and hot-water heaters; the governors on steam-boilers and the boilers ; gas and gas-fixtures ; natural gas and gas-pipes ; electric lighting, and all the appurtenances. You cannot free ■ References : 1. Investigation by the Senate of Pennsylvania into the Anthracite Coal Diffi- culties, 1871. 2. Morris Run Coal Company vs. The Barclay Coal Company. Pennsylvania State Reports, Vol. 68, p. 173. 3. Report on the Coal Combination. New York Assembly Committee on Rail- roads, 1878. 4. Labor Troubles in Anthracite Regions, 18S7-18SS. House of Representa- tives, 50th Congress, Second Session. Report No. 4147. 5. New York Senate Investigation of the Coal Combination, 1892. 6. Alleged Coal Combination. House of Representatives, 52d Congress, 2d Session. Report No. 2278. January 18, 1893. 7. Coxe Brothers & Co. vs. The Lehigh Valley Railroad Company, before the Interstate Commerce Commission. Report and Opinion of the Commission. 8. John C. Haddock vs. Delaware, Lackawanna and Western Railroad Com- pany, before the Interstate Commerce Commission, 1890. 9. Hoclving Valley Investigation. General Assembly of Ohio, 1885. 10. Trusts or Pools. Investigation by Legislature of Ohio, 1 889. 11. Alleged Combinations in Manufactures, Trade, etc. Dominion House of Commons, ISSS. 10 CUT OFF FS03I FIRE 3'ourself by changing from electricity to gas, or from the gas of the city to the gas of the fields. If you fly from kerosene to candles, you are still under the ban. Tlie report adopted by the National Association of Stove Manufacturers, at the Thirteenth Annual Convention, 1884, said : "While it is true that iron is a dollar or two lower than last year, and that the cost of labor has also been reduced, your committee is confident that there is not a manufacturer pres- ent who can truthfully say he can afEord to reduce the price of his goods." " It is a chronic case," the President said in 1888, " of too many stoves, and not enough people to buy them." The match company, by whose consent all the fires in the United States and Canada are lighted, was organized, as stated, by the Supreme Court of Michigan, for the purpose of con- trolling the manufacture and trade. Thirty-one manufactu- rers, owning substantially all the factories where matches were made in the United States, either \\ ent into the combination, or were purchased by the match company, and out of this number all were closed except about thirteen. One of the company, who has been a conspicuous candidate for a nomination to the presidency of the United States, testi- fied that the price of matches was kept up to pay the large sums of money expended to exclude others froni tlie match business, remove competition, buy up machinery and patents, and purchase other match factories. This was told in a suit between two stockholders on a question of their relative rio-hts ; but the court, of its own motion, declared the combination ille- gal, and took notice of the public interests involved." '•'Such a vast combination is a menace to the public," said the court. " It is no answer to say that this monopoly has, in fact, reduced the price of friction-matches. That policy may have been necessary to crush competition. The fact exists that it rests in the discretion of this company at an^' time to raise the price to an exorbitant degree." " Indeed, it is doubt- ful if free government can long exist in a country where such ' Eichardsou vs. Bulil d al. Michigan State Reports, vol. Ixxvii., p. 632. COAL FIELDS CHANGE OWNERS H enormous amounts of money are allowed to be accumulated in the vaults of corporations, to be used at discretion in control- ling the property and business of the country against the in- terest of the public and that of the people, for the personal gain and aggrandizement of a few individuals." Within the last thirty years, 95 per cent, of the anthracite coal of America — practically the entire supply, it was reported by Congress in 1893— has passed from the ownership of private citizens, many thousands in number, into the possession of the railroads controlling the highways of the coal-fields. These railroads have been undergoing a similar process of consolidation, and are now the property of eight great corpo- rations. This surrender of their property by the individual coal-mine owners is a continuing process, in operation at this moment, for the complete extinction of the " individual " and the independents in this field. It is destined, according to the rej)ort of Congress of 1893,' to end " in the entire absorption . . of the entire anthracite coal-fields and collieries by . . . the common carriers." Anthracite coal is geographically a natural monopoly con- tained in three contiguous fields which, if laid close together, would not cover more than eight miles by sixty. But bitu. minous coal, although scattered in exhaustless measures all over the continent, is being similarly appropriated by the rail- roads, and its area is being similarly limited artificially by their interference. '•'Eailroad syndicates," says the investigation of 1888," "are buying all the best bituminous coal lands along their lines in Missouri, Kansas, Colorado, Arkansas, Tennessee, Alabama, and other AVestern States and Territories, no doubt with a view of levying tribute upon the people's fuel and the indus- trial fires of tlie country." Canada remains unannexed politically, but its best coal de- vposits have become a part of the United States. In 1892 a s^mdicate of American capitalists obtained the control of the ' Pajre ii. ' Page xxii. 12 CUT OFF FBOM FIliE principal bituminous coal-mines of Nova Scotia. Among them were men connected both with the antliracite pool and with the combination which seeks control of the oil market of Can- ada and of the United States. The process of consolidation is shown by official and judicial investigations to have been in progress in the bituminous fields at least as far back as 1871, with the same purposes, methods, and results as in the anthracite fields, though more slowlj', on account of the greater number and vastness of the deposits. From Pennsylvania to the Pacific coast these are narrowed to the territory along the railroads, and narrowed there again to the mines owned or favored by the railroad managers. The investigations by Congress in 1888 and 1893 both state that the railroads of the country are similarly becoming the owners of our iron and timber lands, and both call upon the people to save themselves. A new law of industry is rising into view. Ownership of the highways ends in ownership of everything and everybody that must use the highways. The railroads compel private owners to sell them their mines or all the product by refusing to supply cars for their business, and by charging rates for the transportation of coal so high that every one but themselves loses money on every ton sent to market. When the railroads elect to have the output large, they furnish many cars ; when they elect to have the output small, they furnish few cars ; and when they elect that there shall be no output whatever, they furnish no cars. One of the few surviving independent coal producers, who is losing heavily on every ton he sends to market, but keeps on in the hope that the law will give him redress, was asked by a committee of Congress why he did not sell out and give up the business? He was willing, he said, to abide the time when his rights on the railroad could be judicially detei'- mined. There was another reason. '•' It might be considered a very sentimental one. I have spent, sir, considerable time and a large amount of energy and skill in building up my business, and I rather like to continue it." " In other words, you don't want to be forced to sell out V^ WMO OWNS TEE ROADS OWNS ALL 13 " 'Eo, sir ; I don't want to be forced to sell my product, any more than I want to be forced to sell my collieries." ' Though coal is an article of commerce greater in volume than any other natural product in the United States carried on railroads, amounting to not less than 130,000,000 tons a year ; and though the appliances for its transportation have been improved, and the cost cheapened every year, so that it can be handled with less cost and risk than almost any other class of freight, the startling fact appears in the litigations before the Interstate Commerce Commission and the investi- gations by Congi-ess, that anthracite freight rates have been advanced instead of being decreased, are higher now than they were in 1879, and that coal is made by these confeder- ated railroads to pay rates vastly higher than the average of all other high and low class freight, nearly double the rate on wheat or cotton. These hig h freiglit rates serve the double purpose of seeming to justify the hi gli price o f coal, and of killing off year by yea r the inde pendent coal - produceriT ) What tli g railroa d coal - miner pays for freight returns to its -ntlipr j!p1f^ thp. jrailrnad.-- -AVihattkeJiide pendent coal-prodncer - pays -goes also to. the railr oad, his competitor. "This excess over just and. reasonable_ratesjDf_transportation coustitutes]an> 'i^valkble fund by whic h they (the raiLroadgj_ar,e_ena.bled_to_ crushout the competition of independent coal-producers." ' By these means, as Congress found in 1888,°"tlie rail- '• i-oaci managers' hav e Torce^ tEe in3ependentTniffers~to— sell ^'"tliem or their friends at the price ~lTiey chose ^ pay;_ They were the only possible buyers, because oniy^they were sure of a supj^ly of cars, and of freight rates at which they could live. The^priyate operators thus being frozen out are able, as the investigation_by_ihe_!NlewJYprkJLegislaturejn^ showed, vjxLprn rlnfp. or, ;\\ TTinve econ omically tlian the great companies, — be c > ui b e nuL bu i dened -^ypitlt-extxay agant salaries, royalties, and ' Coal Combiii-ition, Congress, 1893. Testimony of Joliii C. Haddock, pp. 242- 261. * Same, p. ir. ^ Report, p.^xlv. 14 CUT OFF FUOM FIllE leases, interest on fictitious bonded debts, and dividends on ofatse'capitalization of Watered stock. By flie laws o£ sujjply and~3e]iiand t he y would c o mpete oi rtT lie u nwieldx_coi'p5£a- C^^OOspBiit these administer a superior political economy in tEeJ Fsupply and demand of cars and Ireig ht rates. The Uii- " fittest, economically, survives. " The railroad companies engaged in mining and transport- ing coal are practically in a combination to control the output and fix the price. . . . They have a practical monopoly of tlie production, the transportation, and sale of anthracite coal." ' This has been the finding in all the investigations for twenty years. " More than one, if not all, of the anthracite monopo- lies," Congress reported in 1888, "run several of their mines in the name of private operators to quiet the general clamor against carrying companies having a monopoly of mining also." The anthracite collieries of Pennsylvania could now pro- duce 50,000,000 tons a year. The railroads restrict them to 40,000,000 or 41,000,000 tons,' nine or ten million tons less than they could furnish to ward off the frosts of winter and to speed the wheels of the world, and this creation of arti- ficial winter has been in progress from the beginning of the combination. In the ten months between February and ISTovember, 1892, the price of coal in the East, as investigated by Congress in 1893,° was advanced by the coal railroads as much as §1.25 and $1.35 a ton on the kinds used by house - keepers, and the combinations, the report of Congress says, " exercise even a more baleful influence on the production and transpor- . tation of coal for the "Western market." The extortion in the price fixed by tlie coal railroads was found by Congress, in 18SS, to be an average of one dollar a ton — " considerabl}' more than a dollar a ton" — on all consumed in the United States, or §39,000,000 in that year, and now $40,000,000 to $41,000,000 a year. The same investigation found tliat be- ' Coal Combination, Congress, 1S93, pp. iii., iv., vi. ' Same p. i. ^ Same, p. v. SURVIVAL OF THE UNFITTEST 15 tween 1873 and 1886 $200,000,000 more tlian a fair market price was taken from the public by this combination.' This in anthracite alone. How many hundreds, perhaps thousands, of millions more have been taken by the railroads which control the bituminous coal - fields from Pennsylvania to the Pacific, there are no adjudicated means of estimating. By the same power which has crushed out the indepen- dent coal -miner, the retailer in the cities has been reduced from a free man to an instrument to despoil his neighbors — with whom he is often a fellow-victim — for the benefit of ab- sentee capitalists ; he is hounded by detectives ; by threats of cutting off his supply, is made a compulsory member of a se- cret oath -bound society to "maintain prices." "Combina- tions exist," says the Canadian report, " among coal-dealers in Toronto, Ottawa, Montreal, and London. Detectives are em- ployed and the dealers placed under surveillance. . . . Oaths of fidelity to the constitution and rules are required not only of the members, but also of their salesmen, and the oaths in the cases of these employes are made in some instances retroac- tive as well as prospective. All violations of oaths are ad- judicated upon by the executive committee referred to, the penalties being heavy fines or expulsion. ... In accordance with arrangements made with the American coal - dealers, those who were in default in membership, either from inabil- ity to pay fines or from other causes, were prevented from purchasing coal in the United States." " The retailer dare not tell his wrongs even in the commit- tee-rooms of Congress. " Your committee," says the i-eport of 1893 to Congress, " experienced great difficulty in obtain- ing testimony from retail coal-dealers, who apparently labor under fears of injury to their business in case they should appear and give evidence." "During tlie first forty years," Congress reported in 1SS8, " the mines were worked by individuals, just as are farms. The hundreds of employers were in active competition witli ' Report, pp. xiv., xv., xlix. - Combinations, Canadian Parliament, 1888, pp. 5, 6, '1. 16 CUT OFF FROM FIRE each other for labor. The fundamental law of supply and demand alike governed all parties. As to engagement, em- ployer and employe stood upon a common level of equality and manhood. Skill and industi-y upon the part of the miner assured to liim steady work, fair wages, honest measurement, and humane treatment. Should these be denied by one em- ployer, many other employers were ready to give them. The miner had the same freedom as to engagement, the same re- ward for faithful service, and protection against injustice that the farm-hand possesses because of the competition be- tween farmers employing hands. . . . This virtual combina- tion of all employers into one syndicate has practically abol- ished competition between them as to wages; and gradually, but inexorably, the workmen have found themselves encoiled as by an anaconda until now tiiey are powerless." ' There was an investigation of the coal combination by the Pennsylvania Legislature in 1871, the testimony taken in which showed tliat when, after a thirty days' strike by the men, a number of private coal-mine owners acceded to their terms, and wished to reopen their mines and send coal again to market, the railroads, by which alone they could get to market, raised their freights, as their men were still on strike, to three times the previous figures. These great corporations had determined not to yield to their men, and as they were mine-owners and coal-sellers as well as carriers, they refused to take coal for their competitors. . . The result was that the price of coal was doubled, i-ising to §12 a ton ; the resumption by the private mine-owners was stopped ; and they, the work- men, and the consumer were all delivered over to the tender mercies of tJie six great companies.^ The coal companies in the anthracite regions keep thousands ■ of surplus laborers on hand to iinderbid each other for em- ployment and for submission to all exactions ; hold them pur- posely ignorant when the mines are to be worked and when ' Report, p. Ixx. 2 Iiirestigatiou by tlie Senate of Pennsjlvauia into the Anthracite Coal Difficul- ties, 1S71. A SLIDING SCALE 17 closed, so that they cannot seek employment elsewhere ; bind them as tenants by compulsion in the companies' houses, so that rent shall run against them, whether wages run on or not, and under leases by which they can be turned out with their wives and children on the mountain-side in midwinter if they sti'ike ; compel them to fill cars of larger capacity than agreed upon ; make them buy their powder and other working outfit of the companies at ah enormous advance on tlie cost ; com- pel them to buy coal of the company at the company's price, and in many eases to buy a fixed quantity, more than they need ; compel them to employ the doctor named by the com- pany, and to pay him whether sick or well; "pluck" them at the company's stores, so that when pay-day comes around the company owes the men nothing, there being authentic cases where " sober, hard-working miners toiled for years or even a lifetime without having been able to draw a single dol- lar, or but a few dollars, in actual cash," in " debt until the day they died ;" refuse to fix the wages in advance, but pay them upon some hocus-pocus sliding scale, varying with the selling price in New York, which the railroad slides to suit itself ; and, most extraordinary of all, refuse to let the miners know the prices on which their living slides — a fraud, says the report of Congress, " on its face." ' The companies dock the miners' output arbitrarily for slate and other impurities, and so can take from their men five to fifty tons more in every hundred than thej' pay for." In order to keep the miners disciplined and the coal-market undei'-supplied, the railroads restrict work so that the miners often have to live for a month on what they can earn in six or eight days; and these restrictions are enforced upon their miners by withholding cars from them to fill, as upon com- petitors by witliholding cars to go to market.^ Labor organizations are forbidden, and the men intention- ally provoked to strike, to affect the coal-market. The laboring population of the coal regions, finall}', is kept ' Report, pp. Ixx., and following. • Same, p. Ixxvi. ' Same, p, Ixxvii. 18 CUT OFF FROM FIRE " down " by special policemen enrolled under special laws, and often in violation of law, by the railroads and coal and iron companies practically when and in what numbers these com- panies choose. These coal and iron policemen are practically without responsibility to any one but their employers, are armed as the corporations see fit with army revolvers, or Win- chester rifles, or both, are made detectives by statute, and not required to wear their shields. They provoke the people to riot, and then shoot them legally.' " By the percentage of wages," says the report of Congress, " by false measurements, by rents, stores, and other methods, the workman is virtually a chattel of the operator." It says, to summarize : " The carrier drives out both operator and owner, obtains the property, works the mine, ' disciplines ' the miner, lowers wages by the importation of Huns and Italians, restricts the output, and advances tlie price of coal to the pub- lic. It is enabled to commit such wrongs upon individuals and the public by virtue of exercising absolute control of a public highway." ' The people of Pennsylvania, in 1873, adopted a new Con- stitution. To put an end to the consolidation of all the anthra- cite coal lands into the hands of the railroads, this Constitution forbade common carriers to mine or manufaetui-e articles for transportation over their lines, or to buy land except for car- rying purposes. These provisions of the Constitution have been disobeyed " defiantly." " The railroads have defiantly gone on acquiring title to hundreds of thousands of acres of coal, as well as of neighboring agricultural lands," They have been "aggressively pursuing the joint business of carrying and mining coal." So far from quitting it, they "have increased their mining operations by extracting bituminous as well as anthracite." ^ Instead of enacting "appropriate legislation," as command- ed by the new Constitution, to efEectuate its proliibitions, the Legislature has passed laws to nullify the Constitution by pre- 1 Report, pp. is., xciv., and following. 2 Same, p. slv. ' Same, p. siii. THE UNCOMMON CAltEIEB 19 venting forever any escheat to tLe State of the immense area of lands unlawfully held by the railroads. Every effort break- ing down to meet the evil by State action, failure was finally confessed by the passage in 1878, by the Pennsylvania Legis- lature, of a joint resolution asking Congress to legislate " for equity in the rates of freight." In 1887 Congress passed the Interstate Commerce Law, and established the Interstate Commerce Commission to enforce justice on the railway highways. The independent mine- owners of Pennsylvania appealed to it. Two years and a half were consumed in the proceedings. The Commission decided that the rates the railroad charged were unjust and unreason- able, and ordered them reduced.' But the decision has re- mained unenfoi'ced, and cannot be enforced. The railroads treat the Commission with the same contumely they visit on the Constitution of Pennsylvania, and two years after the de- cision Congress in 1893 found their rates to be 50 cents a ton higher than what the Commission had declared to be just and equitable.' The Interstate Commerce Law provides for the imprisonment in the penitentiary of those guilty of the crimes it covers. But the only conviction had under it has been of a shipper for discriminating against a railroad. ' Coxe case before Interstate Commerce Commission, Coal Combination, Con- gress, 1893, p. 183. ■■' Same, p. t. CHAPTER m PEOHIBITION THAT PKOHIBITS That wliicli governments liave not yet been equal to has been accomplished by the private co-operation of a few citi- zens. They decree at their pleasure that iu this town or that State no one shall manufacture alcohol, and they enforce the decree. Theirs is the only prohibition that prohibits. From the famous whiskey ring of 1874 to the pool of 1881 and the trust of 1887, and from the abandonment of that "trust" dress and the reorganization into one corporation in 1890 down to the present, this private regulation of the liquor traffic has gone on. It is a regulation of a good deal more than the liquor traffic. Through its control of alcohol it is a power over the arts and sciences, the manufacture and the preparation of medicines, and a power over politics. More than one chapter of our histoiy exhibits the government itself holding to these rectifiers relations suggestive of anything but rectification. The report of the investigation by Congress in 1893 notes the fact that on the strength of a rumor that the internal - revenue tax was to be increased by Congress, the Trust raised its prices 25 cents a gallon. This would amount to a profit of $12,500,000 on its yearly output. By February, 18SS, all the important distilleries in the Northern States — nearly eighty — were in the Trust, except- ing two, the larger of which was in Chicago. The cases of these irreconcilable competitors were set for consideration, ac- cording to the Chicago Tribunes report, at a private meeting of the trustees February 3d. In April the Chicago distillery firm published the fact that they had caught a spy of tlie Trust in their works. He had given them a confession in SUFJPLY AND DEMAND, AND DYNAMITE 21 writing. In September it was discovered that the valve of a vat in this distillery had been tampered with in sucli a way as to have caused au explosion had it not been found out in time. The next month its owners made known that they had been offered and refused $1,000,000 from the Trust for their works. In December the country was startled by the news that this distillery had been the scene of an awful explosion of dynamite. All the buildings in the neighborhood were shaken and many panes of glass were broken. A jagged hole about three feet square was torn in the roof. There were 15,000 barrels of whiskey stored under the roof that was torn open, and if tliese had been ignited a terrible fire would have been added to the effect of the explosion. A package of dynamite which had failed to explode, though the fuse had been lighted, was found on the premises by the Chicago police. The Chicago representative of the whiskey combination ridiculed the idea that the Trust had had anything to do with this. " Such a thing," he said, " is contrary to the genius of a trust." The wholesale liquor-dealers threatened, at a conference in 1890 with the president of the Trust, to manufacture for themselves, to escape the advance which had been made in the price of high-wines. The president said, as reported in the Wine and Spirit Gazette : " I do not believe there is a spirits distillery in the country that you can buy. We own nearly all of them, and have at present seventy-eight idle distilleries." February 11, 1891, the explosion of December, 1888, was recalled by the unexpected arrest of the secretary of the com- bination in Chicago by the United States authorities. The Grand Jury of Cook County found an indictment, February 17th, ao-ainst the prisoner. April 20ch he was indicted by the Federal Grand Jury. The crime of which he was charged was attempting to bribe a government gauger to blow up the troublesome distillery. The gauger whom the secretary en- deavored to enlist had been loyal to his trust, the govern- 22 PROHIBITION THAT PEOIUBITS ment, and bad made known to his superiors the offer and pur- pose of the bribe. If the explosion had been carried out 150 men at work in the distillery would have been destroyed. The evidence given Congress afterwards tended to show that part of the plan was that the bribed ganger who was to set and explode the infernal-machine was not to be allowed to survive to claim his reward and perhaps repent and tell. The fuse was fixed so that the explosion would be instantaneous instead of giving the time protnised him to get out of the way. In a statement to the press, February 15th, the president of the Trust said, as the result of a conference of the trustees : " "We have unanimousl}' agreed to stand by the secretary." Early in June rumors were in circulation in New York that the Chicago independent had sold out; and soon after the confirmation of the report, with full details, was authorita- tively published. Jiine 8th the judge of the United States Court in Chicago quashed the Federal indictment, on the ground that it is not a crime under any of the United States laws for an internal- revenue ofiicer to set fire to a distillery of his own volition and impulse, and that it is not a crime against the United States for another person to bribe him to do such an act. He held that the ofiender could be punished only through the 'State courts. The United States had property in the distil- lery to the extent of $300,000 due for taxes, which was a legal lien on the property ; but the United States District Attor- ney and the judge could find no Federal law under which, for the gauger to destroy this property of the United States, or for the "Whiskey Trust to bribe him to do so, it was a crime. When the indictments framed by the State Attorney of Chi- cago came before the State courts, three of the four were found defective and were quashed. The Chicago correspond- ent of the Xew York Wo7'ld telegraphed that he had been told by the State Attorney, at the time the Federal proceed- ings were quashed, that of his four indictments he relied most upon that for conspirac}' ; " but in court yesterday the State TEE O AUGER TELLS HIS STORT 23 Attorney let the charge of conspiracy fall to the ground be- cause, as he said, there was not evidence enough to secure a conviction." " We haven't the evidence of the ganger ; I don't know where he is," the State Attorney said. But this witness declared in a public letter in February, 1893, " Myself and others with positive evidence were always ready to testify, and I have the facts to-day." The judge of the State court held the motion to quash until July, and then announced that he would make no deci- sion nntil August. He withheld his ruling until October. Then he held the secretary for trial on two counts, charging conspiracy to bribe the ganger and destroy the independent distillery; but remarked "informally," the newspapers said, that conviction would be difiBcnlt. When the case was called March 22, 1892, a delay was granted " until next Monday," to enable the prisoner's coun- sel to read the "bill of particulars" to find out what he was charged with. The secretary did not trouble himself to at- tend court. His case was not heard of again until June 24th, when he was released on a nolle prosequi entered by the State Attorney because the evidence was insufiicient, and became a free man. That was the end. Owing to this success of State and United States attor- neys in being unsuccessful, the people have never had an op- portunity of hearing in court the evidence on which the Government acted in making the arrest, and on which the grand juries found the indictments. But the ganger through Avhom the secretary of the Trust had attempted to execute his plans was called as a witness before the Committee of Cono-ress which investigated the Trust in 1893, and he told again the story of the infernal-machine. It was as follows, in his own words, omitting names and unnecessary details : " I was United States internal - revenue gauger from 1879 until after Mr. Cleveland's election, and I was reappointed in 1889 and have been continuously since that time. Late in December, 1890, I received a letter from the secretary of the 24 rUOBIBITION THAT PROHIBITS whiskey combination at Peoria, telling me that he would like to meet me at the Grand Pacific Hotel on Xew-year's Day. I met him. He said, ' You may be able to do consider- able good here ; not only for ns, but of considerable advan- tage to yourself. Your $1500 a year is nothing to what you would get by helping us. You can get $10jOOO by assisting us in this thing ; in fact, to make matters right, you could get in three months §25,000.' " The ganger reported this to his superiors, who told him to go on. "Be particular, and after every interview with him make a note of everything that passes between you while it is fresh in your mind." "I did that," the witness continued, "and I have the original notes in my pocket. There are tlie original notes," exhibiting them to the committee. " They have never left my posses- sion. I have kept them on my person right along." After some correspondence and another interview, he met the secre- tary again January 25th. "Now," said the latter, " I can give you something which, if put under a cistern, will in three or four hours go ofE, and no person know what it was or who did it, and all the trouble that has been caused ns will be stopped at once, the sufferings of many people stopped, and no loss to those folks, as they are well insured." " When I recovered from my surprise I asked if it was an explosive. He replied, ' No ; a simple but effective thing which would shoot a ball into a tub through the bottom. You will have $10,000 for your work of placing tliis under a cistern of high-proof, either alcohol or spirits, or what is better than cash, 200 shares of stock.' I asked at what they sold. He said, ' Forty-seven, but it would be up ten points at once,' and I could profit by the raise. ' This will raise a big row.' ' Yes,' he said, 'one cistei-n well caught, all would go, and it would be right into the ware- house and stop everything at once. It is the most effective way to help us and make a clean job, and yon having access to all parts of the distillery and unsuspected is why you could do it so easily.' He had then, in room 35, powder and four steel elongated balls, solid, turned, and with long points. The principal article, however, was a kind of yellowish liquid, THE GENTLEMAN IS ARRESTED 25 which when exposed to sixty-five degrees temperatare would produce a flame caused by evaporation. I remarked that there was probably no hurry about this thing, and he said, ' The sooner the better ; you may be ordered away from here, and I am come all prepared ; everything is ready to load, and that can be done .quickly.' " The ganger reported all this to his superior and told him that " I proposed to tate the infernal apparatus." His supe- rior said, " Of course." " I then returned to Grand Pacific, room 35 ; found loading just completed and much material scattered about, oakum in can saturated slightly with kerosene and alcohol to give good start. The seeretai-y said that three fuses were attached to the gun, one of which would go o£E under water. He had one steel shell which had been shot througli three inches of wood in experimenting. He showed me particularly how to place can ; to feel underneath for tim- bers ; put it where ball will enter tub. Also, that in stopping over to meet the president of the combination to-morrow he would have a chance to buy up stock reasonably before our work caused the raise. He expected to buy 1000 shares. Friday, the 30tli of January, I rather anticipated a visit from the secretary at my hotel, but I received a letter from him instead of a visit, and Judge Hart, the solicitor of the luter- nal-Revenue Department, who was there in Chicago, when he read the letter thought that the evidence was certainly con- clusive." On Sunday, the Sth, the ganger surrendered the box containing the infernal-machine, which was sealed, to a high oSicial who had come on from New York. " The reason why he came on is that the authorities would not believe my testi- mony. They did not think it was possible a gentleman in the secretary's position would undertake so heinous a crime, and they did not know but what I was a crank. On Monday, the 9th, I was instructed to write a letter. The thing was to arrest in a proper way. The next day I received a despatch : 'Will be at Pacific to-morrow (Wednesday) morning.' "Wednesday morning tlie secretary was arrested, as he was about to enter the hotel, by a deputy marshal, and conducted 26 PROSIBITION TMAT PSOHLBIIS to the Marshal's office in the Government building. There was a bottle of this composition found in his grip. He had told me it would go off in three or four hours. I was in the anteroom of the city grand jury after the chemist had given his testimony. Tlie chemist said that it was his opinion it would have or might have gone off in three seconds. Fire would cause the shooting of the ball, and the ball making a hole in the tub — alcohol or high-proof spirits — coming down, of course all would have gone up. It could not have helped it, and the explosion would have followed at once, not from the machine, but from the contents of the cistern. They are very explosive indeed, alcohol and higli-proof spirits." ' What the Government authorities thought of all this is shown in a letter which is spread upon the records of the Treasury Department. It is addressed by the Commissioner of Internal Kevenue to the gauger. After thanking him for his "highly commendable" conduct in relation to the bribe the Commissioner says to Mr. Thomas S. Dewar: "While your rejection of the offer was just what was expected from you, considering your official and personal standing, yet I realize that 5'ou have done more than simply reject the offer. You so conducted the affair as to place the guilty party, it is hoped, in a position in which he will be punished for this -violation of law. The proposition was not only to attempt to corrupt an honest officer of the Government, but was to induce j'ou, by the offer of a large sum of money, to commit a most hei- nous and inhuman act." No attempt was made by the representatives of the Trust before the committee to deny this testimony. They simply disclaimed any responsibility for what their associate and employe had done. " Whatever there was in that," testified tlie president of the Whiskey Trust, " was with the former secretary of this company, if there be anything of it." ^ The Trust increased the number of plants under its control from " nearly eighty " to eighty-one or eighty-two, the num- 1 Whisicey Trust Investigation. Committee on the Judiciary Report, March 1, 1893. 62d Congress, 2d Session, House of Representatives, Report No. 2601, p. 16 and following. °- Same testimony, p. 28. PRESCRIPTIONS FOR THE SICK 27 ber reported by the investigation of Congress in 1893. Its annual production was then 50,000,000 gallons ; about 7,500,- 000 gallons of it alcohol, 42,500,000 spirits. It is evident, says the rejjort, that the company vrill soon have within its grasp the entire trade, and be able to dictate prices to con- sumers at pleasure. "How do you account for spirits going up and corn going down at the same time in two or three instances ?" the treas- urer was asked. " Simply because the distillers were getting in a position whereby they ran less than their capacity." ' The experience of mankind has always found, as Lord Coke pointed out, that monopoly adulterates. The report of Congress states that unquestionably the larg- est part of the product of the combination finds its way into the open markets in the form of "compounded" — or artifi- cial — bourbon and rye whiskeys, brandies, rums, gins, cordials. The testimony establishes the fact that about one half of the whiskey consumed in the country is of this compound prod- uct. These compounded liquors are supplied from the drug- stores to the sick as medicine. One of the expert witnesses summoned to explain the process of this' adulteration ap- peared before the committee with two demijohns, one con- taining pure alcohol and the other spirits, and a number of bottles containing essential oils, essences, etc., with which he proposed to make some experiments. " The basis here, this white product, is what is known as ' spirits ' in the trade. With the use of these essential oils and essences now before you any kind of imitation liquor can be produced at almost a moment's notice. My first experiment will be with Jamaica rum. I put a drop of Jamaica-rum essence into this white spirits, a few drops of coloring matter, and some sugar syrup. Try of it and smell of it. Does it smell like rum and taste like it ? If they want to make it cheaper, they reduce it with water. I will reduce it witli water, and you will now notice ' Whiskey Trust Investigation, Congress, 1893, p. 62. 28 PBOEIBITION THAT PROHIBITS that the bead has disappeared from it. I will reproduce the bead by the use of bead oil. I put one drop in, and here is the result. Is^ow, using rye-whiskey essence instead of Ja- maica-rum essence, I will flavor this spirits. I will now put some prune juice into it to tone it. I will put some raisin oil in it to age it, and I will now commence to color it. This first exhibit" (holding it up before the committee) "is about the color of one-year-old whiskey that has been properly bonded. I will now color it so it will imitate a two-year-old whiskey. This is about the three-year-old now " (exhibiting it). " I will now give this the color of ' velvet whiskey,' which is sold as high as $4 a gallon " (exhibiting it). " The present price of spirits, to-day, I think, is $1.30 a gallon. The utilization of any of these essential oils and essences and coloring matter to make the transfer does not exceed a cost of one and a half cents a gallon. I am prepared to make imitations of any of these liquors at any time with this spirits basis — all the dif- ferent whiskeys, Scotch and Irish whiskeys, the foreign gins and rums and brandies, after-dinner cordials and liqueurs. These materials as yon have them exhibited before you of essential oils and essences are part and parcel of the stock in trade of every man in the United States of America who has got a rectifying license as a wholesale liquor dealer. . . . They are very generally and extensively in use throughout our entire country, in every hamlet and village, in all the branches of trade, the wholesale liquor dealer, the grocer hav- ing a liquor dealer's license, and retail druggists. . . . When a doctor prescribes French brandy, he expects to get a produc- tion which is a distillation of wine made from the grape. In that imitation brandy made from spirits and cognac oil he gets a crude product of corn, defeating entirely his purpose in the prescription. The same applies to gin, rum, and other articles wherever the imitations are found." ' Some of the substances named by witnesses as occurring in the oils and essences used for this adulteration are sulphuric > Whiskey Trust Investigatiou, Congress, 1S93, pp. 14, 15. A LIBERAL EDUCATION 29 acid, prussic acid, fusel oil, creosote, nitro-benzol — all poisons, and some of them so virulent that a teaspoonful would kill. " I have been warned when in the employ of these people not to take the crude material into my mouth," said one of the witnesses. Another witness denied that there was any danger in the infinitesimal portions used of the flavoring matter. " The only result," said one of the members of the commit- tee, " of the testimony and hearing of the committee will be to educate the public to the Trust methods. It will have no efEect on the Trust." CHAPTER IV " SQUARE EATEES " "By Heaven, square eaters, more meat I say !" — Beaumont and FletcJier. A DELEGATE to One of the millers' national conventions said, " We want cheaper wheat and dearer flour." The Canadian Parliament reports that " the Biscuit Asso- ciation," which had been in existence six years, had kept up the prices of its products, " although the prices of the ingre- dients used have in that time very materially decreased." An Associated Press despatch from Chicago announced that at " a joint meeting of all the cracker bakers between Pitts- burg and the Eocky Mountains, held this morning, it was unanimously agreed to advance the price of crackers." A " Bread Union " has been formed in London for the amalgamation of concerns controlling hundreds of shops. Its chairman instructed the stockholders that by concentrating a large number of shops under one management in any district it could "quickly stifle the opposition of any small unprin- cipled trader bent on reducing prices for competition pur- poses." The Dominion Parliament, in condemning the Gro- cers' Guild as " obnoxious to tlie public interest in limiting competition, in enhancing prices," pointed out that " no rea- sonable excuse exists for many of its arbitrary acts and agree- ments. The wholesale grocery trade had been for many years in a flourishing condition ; failures were almost unknown." But though prosperous the grocers formed this guild, ad- mitting some, proscribing others, and established by private legislation the profits they desired. The profits were " after- wards increased, and in no instance lowered, though values generally had fallen." THE REMEDY WAS UNCONSTITUTIONAL 31 At Minneapolis, the seat of tlie greatest flour-manufactur- ing industry in the world, the elevators and railroads have united against tlie wheat-growers in a way which does much to realize the dream of the miller, of "cheaper wheat and dearer flour." A committee of the Minnesota legislature in- vestigated this combination in 1892. The majority stopped short of reporting that it fixed the prices of wheat, but admit- ted that some of the testimony tended that way, and that the evidence "would seem to establish" that one of the most powerful railroads had done so, and " had attempted to coerce compliance with its requiremerfts in the matter of prices by threats to embarrass the business of local buyers." ' A report from a minority of the same committee was more outspoken. It summarizes the evidence, which shows that the railroads and the elevator companies united to enforce a uniform price for wheat. This price was six and a quarter cents below what it should be. All the railroads adjusted their freight rates to the artificial "list-price," and though rivals, they all charged the same rates. The elevator companies, owning an aggregate of fifteen hundred elevators, had a common agent who sent word daily, by telegram and letter, to all wheat- buyers as to the price to be paid the farmers. The report calculates the amount thereby taken from the wheat-growers by the elevators at from four to five millions of dollars a year. The findings of this report were ratified by the adoption of its suggestions for a remedy. " There is," it said, " no agency but the State itself adequate to protect, now, the producer of wheat in Minnesota and the Northwest from the infiuence of this combine." It therefore recommended the erection and operation of elevators by the State. This was approved by the Legislature and by the Governor, appropriations were made, and the ofiicials of the State went forward with the plan until the Supreme Court of the State stopped them on the ground of " unconstitutionality." ' Keport of the Investigating Committee appointed by the Legislature of Min- nesota of 1891, to determine whether wheat was taken without inspection from a public elevator in Duluth. April 7, 1892, p. U. 32 "SqVARE EATERS" That whicli we see the national associations of winter-wheat millers and spring-wheat millers, and the fish, and the egg, and the fruit, and the salt, and the preserves, and other com- binations reaching out to do for a "free breakfast table," to put the " square meal " out of the reach of the " square eater," has been achieved to the last detail in sugar and meat. Every half-cent up or down in the price of sugar makes a loss or gain to the sugar combination at the rate of $20,000,000 a year. When it was capitalized for $50,000,000 it paid divi- dends of 85,000,000 a year. The value of- the refineries in the combination was put by* the New York Legislative In- vestigation of 1891 at §7,000,000. The Hon. Wm. Wilson, of the committee of Congress in- vestigating trusts in 1888, and the framer of the tariff bill of 1893, in a public communication quoted figures showing that this Trust had a surplus of $10,000,000 at the end of 1888, after paying its 10 per cent, dividend. The profits for the next five and a half months were $13,000,000. This surplus of one year and net profits of less than half a year together amount to $23,000,000, nearly half the then nominal capital, and several times more than the real value of all the concerns, as given above. These profits so conservative a paper as the jlSTew York Daily Commereial Bulletin called "plunder," and it reaffirmed that epithet when called to account. Stock was issued for this " fabulous valuation " of $50,000,000, put on this $7,000,000 of original value, and was made one of the specialties of the stock market. " There has been an enormous and widespread speculation in the certificates of the trust," says the report of the jSTew York Senate. " It was plainly one of the chief purposes of the trust to provide for the issue of these eei'tificates, affording thereby an opportunity for great speculation in theui, obvious- ly to the advantage of the persons managing the trust. The issue of $50,000,000 certificates was amply sufficient for a speculation of many hundreds of millions of dollars." ' ' Trusts, Xew Yoi-k Senate, 1S91, pp. 0, 11. "EVENISTG" CATTLE AND MEAT 33 Since this investigation by the New York Legislature, the Sugar Trust has been reorganized into a single corporation. The capital of tliis is $75,000,000, all " water," since the value of the plants is fully covered by the bonds to the amount of $10,000,000. The actual value of the refineries in the Trust, excluding those which have been closed or dismantled, was in- vestigated by the New York World, January 8, 1894, and put at $7,740,000. On this actual value of $7,740,000 in operation the Trust paid in regular and extra dividends in 1893 no less than $10,875,000, and acknowledged that there was in addi- tion a surplus of $5,000,000 in the treasury. This was in ad- dition to the interest on the $10,000,000 of bonds. When a farmer sells a steer, a lamb, or a hog, and the house- keeper buys a chop or roast, they enter a market which for tlie whole continent, and for all kinds of cattle and meats, is controlled by the combination of packers at Chicago known as "the Big Four."' This had its origin in the "evening" arrangement, made in 1873 by the railroads with preferred shippers, on the ostensible ground that these shippers could equalize or even the cattle trafBc of the roads. They received $15 as "a commission" on every car-load of cattle shipped from the West to New York, no matter by whom shipped, whether they shipped it or had anything to do with it or not. The commission was later reduced to $10. They soon became large shippers of cattle ; and with these margins in their favor "evening" was not difficult business.' By 1878 the dressed- beef business had become important. As the Evener Com- bine had concentrated the cattle trade at Chicago, the dressed- beef interest necessarily had its home at the same place. It is a curious fact that the Evener Combine ceased about the time the dressed-beef interest began its phenomenal career.' The committee appointed by the United States Senate to investigate the condition of the meat and cattle markets fixed ' Meat Products, United States Senate, 51st Congress, 1st Session, Report Xo. S29, 1890, p. 2. "- \ew York Assembly, " Hepburn Report," 1879, p. 10. ^ileat Products, United States Senate, 1890, p. 3. 3 34 "SQUARE EATERS" upon St. Louis, Mo., and November 20, 1S88, as the time and place of meeting, because the International Cattle Kange Association and the Butchers' National Protective Association assembled at tlie same time and j^lace. It was supposed that prominent members of these associations would avail themselves of the opportunity to appear before the commit- tee. Some of them did testify frankl}', but the presence of antagonistic influences, especially in the International Cat- tle Range Association, immediately became apparent, and in- dustrious efforts were made to prevent the inquiries of the committee from affecting injuriously the dressed-beef interest at Chicago. The committee found that under the influence of the combination the price of cattle had gone down heavily. For instance : In January, 1884, the best grade of beef cattle sold at Chicago for S7.15 per hundred pounds, and in January, 1889, for §5.40 ; Northwestern range and Texas cattle sold in January, 1884, at 85.60, and in January, 1889, at $3.75 ; Texas and Indian cattle sold in 1884 at $4.75, the price declining to $2.50 in December, 1889. These are the highest Chicago prices for tlie months named. "So far has the centralizing process continued tliat for all practical purposes," the report says, " the market of that city dominates absoluteh- the price of beef cattle in the whole country. Kansas City, St. Louis, Omaha, Cincinnati, and Pittsburg are subsidiary to the Chicago market, and their prices are regulated and fixed by the great market on tlie lake."' This great business is practical!}' in the hands of four establishments at Chicago. The largest houses have a capacity for slaughtering 3,500 cattle, 3,000 sheep, and 12,000 hogs every ten hours. Wlien the Senate committee visited Chicago, it was found impossible to obtain the frank and full testimony of either the commission men doing business at the Union Stock Yards, or of the employes of the packing and dressed- beef houses. The former testified reluctantly, and were un- questionably under some sort of constraint as to their public ' Meat Products, United St.ites Senate, 1S90, pp. 1, 2. BUTCHERS WHO MUST NOT KILL 35 declarations. In private they stated to the members of the committee that a combination certainly existed between the "Big Four;" bnt when put on the stand as witnesses they shuffled and prevaricated to such a degree as, in many cases, to excite commiseration. The committee reported that the overwhehning weight of testimony from witnesses of the high- est character, and from all parts of the West, is to the effect that cattle -owners going with their cattle to the Chicago and Kansas City markets find no competition among buyers, and if they refuse to take the first bid are generally forced to ac- cept a lower one. As to the effect upon retailers, local butchers, and consum- ers, it was admitted by the biggest of the Big Four " that they combined to fix the price of beef to the purchaser and consumer, so as to keep up the cost in their own interest." ' They combined in opening shops and underselling the butch- ers of cattle at places all over the country, in order to force them to buy dressed meat. They combined in refusing to sell any meat to butchei-s at "Washington, D. C, because the butch- ers had bid against them for contracts to supply with meats the Government institutions in the District of Columbia. The compulsion put upon local butchers is illustrated in the S case. The following telegram was sent from the office of one of the combination at Chicago to an agent in Pennsyl- vania : " Cannot allow S to continue killing live cattle. If he will not stop, make other arrangements, and make prices so can get his trade." S was a local butcher. He testified that he was ap- proached by the agent with a proposition that he should sell dressed beef. He refused, and was then informed that he would be broken up in business. Notwithstanding this threat, he continued to butcher, and made his purchases of cattle at Buffalo. From the time of his refusal to sell dressed beef as proposed, he could not buy any meat from Chicago, and could not get any cars from the Erie Eailroad to ship his cattle from • Meat Products, United States Senate, 1S90, p. 6. 36 "SQUARE EATEliS" Buffalo. He was boycotted for his refusal to discontirinc kill- ing cattle.' One of the combination, when testifying to this matter, disclaimed responsibility for the despatch, but stated that he did not think a butcher should be permitted to kill cattle and at the same time sell dressed beef. " He could not serve both interests." " We have no hesitation in stating as our conclusion, from all the facts," says the report, "that a combination exists at Chicago between the principal dressed- beef and packing houses, which controls the market and fixes the price of beef cattle in their own interest." When pork is cheap, less beef is eaten. Beef monopoly must therefore widen into pork monopoly. This has hap- pened. There is a combination between the pork-packers at Chicago and the large beef-packers. It began in 1886. The existence of such an arrangement was admitted by its most important member; and it is found to have seriously affected the prices of beef cattle, both to the producer and consumer. It was shown that one of the companies of the Big Four made in 1889 profits equal to 29 per cent, on its capital stock — which may, or may not, have been paid in — and this was not the largest of the companies. As to the idea that other capi- talists might enter into competition with those now in posses- sion, the report says: "The enormous capital of the great houses now dominating the market, which each year becomes larger, enables them to buy off all rivals." The favoritism on the highways, in which this power had its origin in 1873, has continued throughout to be its main stay. The railroads give rates to the dressed-beef men which they refuse to shippers of cattle, even though they ship by the train-load — " an unjust and indefensible discrimination by the railroads against the shipper of live cattle." The report says, : " This is the spirit and controlling idea of the great monopo- lies which dominate the country. . . . No one factor has been more potent and active in effecting an entire revolution in the methods of marketing the meat supply of the United States ■ Meat Products, United States Senate, 1890, Testimony, pp. 464, 465. WJSAT THEY WILL WITH THEIR OWN 37 than the railway transportation." ' There liave been discrimi- nations by the common carriers of the ocean as well as by the railroads. The steamship companies exclude all other ship- pers, by selling all their capacity to the members of the beef combine, sometimes for months in advance. It is useless for any other shipper to applj'. Property is monopoly, the Attorney-General of the United States sa3's. Those who own the bread, meat, sugar, salt, can fix the price at which they will sell. They can refuse to sell. It is to these fellow-men we must pray, " Give us this day our daily bread." And when we have broken bread for the last time, we can get entrance to our " long home " only by paying " exorbitant " toll for our shrouds and our coffins to the "Undertakers'" and the "National Burial Case " associa- tions.^ 1 Meat Products, United States Senate, 1890. Trusts, New York Senate, 1S8S. Combinations, Canadian Parliament, 1888. CHAPTER V STRIKING OIL It was an American idea to " strike oil." Tliose who knew it as the " slime " of Genesis, or used it to stick together the bricks of the Tower of Babel, or knelt to it in the fire temples, were content to take it as it rose, the easy gift of nature, oozing forth on brook or spring. But the American struck it. The world, going into partial eclipse on account of the fail- ing supply of whale oil, had its lamps all ready for the new light, and industries beyond number needed only an expansion of the supply. De Witt Clinton, with the same genius that gave us the Erie Canal, suggested as earl}' as 1814 the use of petroleum for light. Eeichenbach, the great German chemist, predicted in 1830 that petroleum would yield an illuminating oil equal to the finest. Inventors and money-makers kept up close with scientific investigators in France, Great Britain, and America. As early as 1845 the manufacture of coal-oil, both for light and other purposes, had become important in France. Selligue had made himself master of the secrets of petroleum. His name, says one of his chroniclers, " must forever remain insep- arably connected with that of the manufacture of light from oil, and to his researches few have been able to add." ' The name of this genius and benefactor of humanity has re- mained almost unknown, except within a small scientific world. He was a member of the French Academy, and almost every year between 1834 and 1848 he came to it with some new dis- ' F. H. Storer, Amo-ican Journal cf Science, vol. x.xx., 1860. WHO TME PIONEEMS WERE 39 covery. On one occasion lie reminds his associates that he holds a patent, granted in 1832, for making illuminating oil from coal, and declares that the business can be developed to any extent which commerce or the arts may require. By 1845 he had unlocked nearly every one of the hidden places in which this extraordinary product has stored its wonders. He found out how to make illuminating oil, illuminating gas, lubricating oil, colors, paraffine for candles, fertilizers, solvents for resin for painters, healing washes, chemicals. He had three refin- eries in operation in the Department Saone-et-Loire, as de- scribed in the report of a committee of the Frencli Academy in 1840. He exhibited his oils in the London Exhibition of 1851, and twelve years before, in the Parisian Industrial Exhi- bition of 1839, he had crude and refined oils and paraffine to show. " Among the most important objects of the exhibi- tion," said its German historian, Von Hermann, " if they can be prepared economically." This Selligue accomplished. Be- tween 1837 and 1843 he refined more than 4,000,000 pounds of oil, and 50 per cent, of his product was good illuminating oil. Before 1850, the Scotch had succeeded in getting petro- leum, called shale oil, out of bituminous coal, had found how to refine it, and had perfected lamps in which it would burn. Joshua Merrill, the pioneer of oil refining in this country, with his partners, successfully refined petroleum at Waltham, Mass., where they established themselves in 1853. The Amer- ican manufacturers were making kerosene as early as 1856 from Scotch coal,' imported at a cost of §20 to $25 a ton, and getting experts like Silliman to analyze petroleum, in the hope that somehow a supply of it might be got. By 1860 there were sixty -four of these manufactories in the United States. " A crowd of obscure inventors," says Felix Foucon, in the Revue des Deitx Mondea, " with unremitting labors perfected the lamp — when it was premature to dream that illumination by mineral oil should become universal." All ' Petroleum and Its Products, bj S. F. Peckham, U. S, Ctnsus, 1886, p. 159. 40 STRIKING OIL was ready, as the eminent English geologist, Binney, said, "for the start of the vast American petroleum trade." It was not a lack of knowledge, but a lack of peti-oleura, that hampered the American manufacturer before 18C0.' The market, the capital, the consumer, the skilled labor, the inven- tions, and science were all waiting for " Colonel " Drake. With Drake's success in " striking oil " came to an end the period, lasting thousands of yeare, of fire temples, sweep and bucket, Seneca oil ; and came to an end, also, the Arcadian sim- plicity of the old times — old though so recent — in which Pro- fessor Silliman conld say, " It is not monopolized by any one, but is carried away freely by all who care to collect it." The oil age begins characteristically. As soon as Drake's well had made known its precious contents, horses began run- ning, and telegrams flying, and money passing to get posses- sion of the oil lands for the few who knew from those who did not know. The primitive days when " it was not monopo- lized by anj- one" were over. Thousands of derricks rose all over the territory, and oil scouts pushed with their compasses through the forests of the wilderness in all directions. "Wells were bored all over Europe, as well as America, wherever traces of oil showed themselves, sometimes so close together that when one was pumped it would suck air from the otlier. As soon as the petroleum began to flow out of the ground, refineries started up at every available place. They were built near the wells, as at Titusville and Oil Git}-, and near the cen- tres of transportation, such as Pittsburg and Buffalo, and near the points of export, as Philadelphia, Baltimore, l^ew York. ITumbers of little establishments appeared on the Jersey flats opposite New York. There was plenty of oil for every one ; at one time in 1862 it was only ten cents a barrel. The means of refining it had long before been found by science and were open to all ; and even poor men building little stills could year by year add on ' retroleum and Its Products, by S. F. Peckbam, U. S. Census, 1S85, p. IGO. CAPITAL EAST TO GET 41 to their works, increase tlieir capital, and acquire the self-con- fidence and independence of successful men. The business was one of the most attractive possible to capital. " There is no handsomer business than this is," said one of the great mer- chants of New York. " You can buy the (crude) oil one week, and sell it the next week refined, and yon can imagine the quantity of business that can be done." Men who understood the business, he said, " if they had not the capital could get all of the money they wanted." ' Wliatever new processes and contrivances were needed the fertile American mind set about supplying. To carry the oil in bulk on the railroads tubs on flat cars were first- used ; but it was Dot long before the tub was made of iron instead of wood, and, -laid on its side instead of bottom, became the tank of the cylinder car now so familiar. The fluid which lubricates so many other things on their way through the world is easily made to slip itself along to market. General S. D. Karns was the authoi-," in 1860, of the first suggestion of a pipe line. He planned only for oil to run down hill. Then Hutchinson, the inventor of the Hutchinson rotary pump, saw that oil could be forced through by press- ure, and the idea of the pipe line was complete. The first suc- cessful pipe line, put down by Samuel Van Syckel," of Titus- ville, in 1865, from Pithole to Miller's Farm, four miles, has grown into a net-work of thousands of miles, running through the streets of towns, across fields and door-yards, under and over and beside roads, with trunk lines which extend from the oil regions to Pittsburg, Cleveland, Buffalo, Baltimore, ]^ew York, Williamsport, Chicago, and the Ohio Eiver. There was a free market for the oil as it came out of the wells and out of the refineries, and free competition between buyers and sellers, producers and consumers, manufacturers and traders. Industries auxiliary to the main ones flourished. ' Testimony of Simon Bemheimer, New Tork Assembly " Hepburn " Report, 1879, p. 3549 and following. 2 Petroleum and Its Products, by S. F. Peckham, U. S, Census, 1885, p. 93. » Same, p. 93. 42 STMIKING OIL Everywhere the scene was of expanding prosperity, with, of course, the inevitable percentage of ill-luck and miscalcula- tion ; but with the balance, on the whole, of such happy growth as freedom and the bounty of nature have always yielded when in partnership. Tiie valleys of Penns^'lvania changed into busy towns and oil fields. Tiie highways were crowded, labor was well employed at good wages, new industries were starting up on all sides, and everything betokened the per- manent creation of a new prosperity for the whole communi- ty, like that which came to California and the world with the discovery of gold. But shadows of sunset began to creep over the field in its morning time, and the strange spectacle came of widespread ruin in an industry prospering by great leaps. "Wherever men moved to discover oil lands, to dig wells, to build refiner- ies or pipe lines, to buy and sell the oil, or to move it to market, a blight fell upon them. The oil age began in 1860. As early as 1865 strange per- turbations were felt, showing that some undiscovered body was pulling the others out of their regular orbits. Before the panic of 1873 — days of buoyant general prosper- ity, with no commercial revulsion for a cause — the citizens of this industry began to suffer a wholesale loss of propertj' and business among the refineries in New York, Pittsburg, Cleve- land, and elsewhere, the wells of the oil valleys, and the markets at home and abroad. To the building of refineries succeeded the spectacle — a strange one for so new a business — of the abandonment and dismantling of refineries by the score. The market for oil, crude and refined, which had been a natural one, began to move erratically, by incalculable influences. It went down when it should have gone up according to all the known facts of the situation, and went up when it should have gone down. This sort of experience, defying ordinary calculations and virt- ues, made business men gamblers. "We began speculating in the hope tliat there would be a change some time or other for the better,*' testified one who A PAUADOX OF PROSPERITT 43 had gone into the business among the first, and with ample capital and expert skill.' The fright among the people was proportionate to the work they had done and the value of what they were losing. Since the first well was sunk the wilderness had become a busy region, teeming with activity and endowed with wealth. In ten years the business had sprung up from nothing to a net product of 6,000,000 barrels of oil a year, using a capital of $200,000,000 and supporting a population of 60,000 peo- ple. The people were drilling one hundred new wells per month, at an average cost of $6000 each. They had devised the forms, and provided the financial institutions needed in a new business. They invented many new and ingenious mechanical contrivances. They had built up towns and cities, with schools, churches, lyceums, theatres, libraries, boards of trade. There' were nine daily and eighteen weekly newspa- pers published in the region and supported by it. All this had been created in ten years, at a cost of untold millions in experiments and failures, and the more precious cost of sacrifice, suffering, toil, and life. The ripe fruit of all this wonderful development the men of the oil country saw being snatched away from tliern." More than once during these lean years, as more than once later, the public alarm went to the verge of violent outbreak. This ruinous prosperity brought stolid Pennsylvania within sight of civil war in 1872, which was the principal subject be- fore the Pennsylvania Legislature of that year, and forced Con- gi-ess to make an ofiicial investigation. The jSTew York Legislature followed Congress and the Pennsylvania Legislature with an investigation in 1873. " There was great popular excitement. ... It raged like a violent fever," was the description it heard of the state of things in Pennsylvania." There were panics in oil speculation, bank failures, defalca- ' Testimonv, Trusts, Congress, 1888, p. 214. » Titusville Morning Herald, March 20, 1872. ' Testimony, Erie luTestigation, New York Assembly, IS'/S, p. 418. 44 STBIKINO OIL tions. Many committed suicide. Hundreds were di'iven into bankruptcy and insane asylums. Where every one else failed, out of this havoc and social disorder one little group of half a dozen men were rising to the power and wealth which have become the marvel of the world. The first of them came tai'dily into the field about 1862. He started a little refinery in Cleveland, hundreds of miles from the oil wells. The sixty and more manufacturers who had been able to plant themselves before 1860, when they had to distil coal into petroleum before they could refine petroleum into kerosene, had been multiplied into hundreds by the arrival of petroleum ready made from below. Some of the richest and most successful business men of the country had preceded him and were flourishing.' He had been a book- keeper, and then a partner, in a very small country-produce store in Cleveland. As described by his counsel some years later, he was a "man of brains and energy without money." With him were his brother and an English mechanic. The mechanic was bought out later, as all the expert skill needed could be got for wages, which were cheaper than dividends.' Two or three years later another partner was added, who began life as " a clerk in a country store," ' and had been in salt and lumber in the West. A young man, who had been in the oil region only eleven years, and for two of the eleven had been errand-boy and bookkeeper in a mixed oil and merchandise business,' a lawyer, a railroad man, a cotton broker, a farm laborer who had become refiner, were admit- ted at various times into the ruling coterie. The revolution which revolved all the freemen of this in- dustry down a vortex had no sooner begun than the public began to show its agitation through every organ. The specta- ' Testimony o£ Simon Bernheimer, New York Assembly "Hepburn" Report, 1S79, p. 354S. - Testimony, Freiglit Discriminations, Oliio House of Representatives, 1879, pp. 18i-5. ' Testimony, Trusts, Congress, 188S, p. S04. * Testimony, Pennsylvania Tax Case, 1883, p. 486. THE COMMONWEALTH WANTS TO KNOW 45 cle of a few men at the centre of things, in offices rich with plate glass and velvet plush, singing a siren song which drew all their competitors to bankruptcy or insanity or other forms of " co-operation," did not progress, as it might have done a hun- dred years ago, unnoticed save by those who wore the immedi- ate sufferers. The new democracy began questioning the new wealth. Town meetings, organizations of trades and special interests, grand juries, committees of State legislatures and of the United States Senate and House of Kepresentatives, the civil and criminal courts, have been in almost constant action and inquiry since and because. It -was before the Committee of Commerce of the National House of Kepresentatives in 1872 that the first authentic evi- dence was obtained of the cause of the singular ruin which was overwhelming so fair a field. This investigation in 1872 was suppressed after it had gone a little way. Congress said, Investigate. Another power said, Don't investigate. But it was not stopped until the people had found out that they and the production, refining, and transportation of their oil — the whole oil industry, not alone of -the valleys where the petrole- um was found, but of the districts where it was manufactured, and the markets where it was bought and sold, and the ports from which it was shipped abroad — had been made the sub- ject of a secret "contract"' between certain citizens. The high contracting parties to this treaty for the disposal of an in- dustrial province were, on one side, all the great railroad com- panies, without whose services the oil, crude or refined, could not be moved to refineries, markets, or ports of shipment on river, lake, or ocean. On the other side was a body of thirteen men, " not one of wliom lived in the oil regions, or was an owner of oil wells or oil lands," who had associated themselves for the control of the oil business under the winning name of the South Improvement Company.' ' This contract is printed in full in Exliibits, New Yort Assembly " Hepburn " Report, W1% pp. 418-51, and Trust Report, Congress, 1888, pp. 357-61. 2 Trusts, Congress, 1888, p. 353. 46 STJXIKING OIL By this contract the railroads liad agreed with tliis company of citizens as follows : 1. To donble freight rates. 2. Xot to charge them the increase. 3. To give them the increase collected from all competitors. 4. To make any other changes of rates necessary to guaran- tee their success in business. 5. To destroy their competitors by high freight rates. 6. To spy out the details of their competitors' business. The increase in rates in some cases was to be more than double." These higher rates were to be ostensibly charged to all shippers, including the thirteen members of the South Im- provement Company; but that fraternity only did not have to pay them really. All, or nearly all, the increase it paid was to be paid back again — a " rebate." ' The increase paid by every one else — "on all transported by other parties" — was not paid back. It was to be kept, but not by the rail- roads. These were to band that, too, over to the South Im- provement Company. This secret arrangement made the actual rate of the South Improvement Company much lower — sometimes half, some- times less than half, what all others paid. The railroad offi- cials were not to collect these enhanced freight rates from the unsuspecting subjects of this " contract " to turn them into the treasury of the railroads. They were to give them over to the gentlemen who called themselves " South Im- provement Company." The "principle" was that the rail- road was not to get the benefit of the additional charge it tnade to the people. No matter how high the railroads put the rates to the community, not the railroads, but the Improvement Company, was to get the gain. The railroads bound tliem- selves to charge every one else the highest nominal rates men- tioned. " They shall not be less," was the stipulation. They might be more up to anj' point ; but less they must not be.^ The rate for carrying petroleum to Cleveland to be refined • Alt. 2, sec 3. » Art. 2, sec. 4. ^ Art. 2, sec. 5. A MODERN IMPROVEMENT 47 was to be advanced, for instance, to 80 cents a barrel. When paid by the South Iniprovement Company, 40 cents of the 80 were to be refunded to it ; when paid by any one else, the 40 cents were not merely not to be refunded, but to be paid over to his competitor, this aspiring self-improvement com- pany.' The charge on refined oil to Boston was increased to $3.07 ; and, in the same way, the South Improvement Com- pany was to get back a rebate of $1.32 on every barrel it sent to Boston, and on every barrel any one else sent. The South Improvement Company was to receive sums ranging from 40 cents to $1.32, and averaging a dollar a barrel on all shipments, whether made by itself or by others. This would give the company an income of a dollar a day on every one of the 18,000 barrels then being produced daily, whether its members drilled for it, or piped it, or stored it, or refined it, or not. To pay money to the railroads for them to pay back was seen to be a waste of time, and it was agreed that the South Improvement Company for its members should deduct from the ostensible rate the amount to be refunded, and pay the rail- roads only the difierence. Simplification could not go further. The South Improvement Company was not even to be put to the inconvenience of waiting for the railroads to collect and render to it the tribute exacted for its benefit from all the other shippers. It was given the right to figure out for its members what the tribute would amount to, and pay it to them out of tlie money they owed the railroads for freight, and then pay the railroad what was left, if there was any left.^ The railroads agreed to supply them with all the information needed for thus figuring out the amount of this tribute, and to spy out for them besides other important details of their competitors' business. They agreed to make reports every day to the South Improvement Company of all the shipments by other persons, with full particulars as to how niuch was shipped, who shipped, and to whom, and so on.^ ' Art. 2, Sec. 4. " The same. ' Art. 2, Sec. 8. 48 STRIKING OIL The detective agency thus established by the railroads to spy out the business of a whole trade was to send its reports "daily to the principal office" of the thirteen gentlemen. If the I'ailroads, forgetting their obligations to the thirteen disci- ples, made any reduction in any manner to anybody else, the company, as soon as it was found out, could deduct the same amount from its secret rate." If the open rate to the public went down, the secret rate was to go down as much. For the looks of things, it was stipulated that any one else who could furnish an equal amount of transportation should have the same rates ;° but the possibility that any one should ever be able to furnish an equal amount of transportation was fully taken care of in another section clinching it all. The railway managers, made kings of the road by the grant to them of the sovereign powers of the State, covenanted, in order to make their friends kings of light, that they would " maintain the business" of the South Improvement Company "against loss or injury by competition," so that it should be "a remunerative" and "a full and regular business," and pledged themselves to put the rates of freight up or down, as might be "necessary to overcome such competition." ^ Contracts to this effect, giving the South Improvement Company the sole right for five years to do business between tlie oil wells and the rest of the world, were made with it by the Erie, the New York Central, the Lake Shore and Michigan South- ern, the Pennsylvania, the Atlantic and Great Western, and their connections, thus controlling the industry north, south, east, west, and abroad. The contracts in every case bound all the roads owned or leased by the railroads concerned.* The contracts were duly signed, sealed, and delivered. On the oil business of that year, as one of the members of the committee of Congress figured out from the testimony, the railroad managers could collect an increase of §7,500,000 in freights, of which they were to hand over to the South Im- ' Art. 2, See. 5. = Art. 3. = Art. 4. •■ Exliibits, Xcw York Assembly "Hepburn " Report, pp. 41S-ol. WBO REAPED 49 provemedt Company $6,000,000, and paj' into the treasury of their employers — the railways — only $1,500,000. The contract was signed for the New York Central and Hudson River Railroad by its vice-president, but this agree- ment to kill off a -whole trade was too little or too usual to make any impression on his mind. When publicly interro- gated about it he could not remember having seen or signed it.' "The effect of this contract," the vice-president of the Erie Railway Company was asked, " would have been a complete monopoly in the oil-carrying trade?" "Yes, sir; a complete monopoly."' Of the thirteen members of the South Improvement Com- pany -which was to be given this " complete monopoly," ten were found later to be active members of the oil trust. They -were then seeking; that control of the light of the world which it has obtained. Among these ten were the president, vice- president, treasurer, secretary, and a majority of the directors of the oil trust into which the improvement company after- wards passed by transmigration. Any closer connection there could not be. One was the other. The ablest and most painstaking investigation which has ever been had in this country into the management of the railroads found and ofBeially reported to the same effect : "The controlling spirits of both organizations being the same." ' The freight rates were raised as agreed and without notice. Rumors had been heard of what was coming. The public would not believe anj'thing so incredible. But the oil regions were electrified by the news, February 26, that telegrams had been sent from railroad headquarters to their freight agents advising them of new rates, to take effect immediately, mak- ing the cost of shipping oil as much again as it had been. The popular excitement which broke out on the same day and ' New York Assembly " Hepburn " Report, 1879, p. 1566. ' Testimony, Erie Investigation, New Torlc Assembly, 1S73, p. 300. 3 New York Assembly" Hepburn" Report, 1S19, p. 42. 4 50 STRIKING OIL " raged like a violent fever " became a national sensation. The Titusville Moming Herald of March 20, 1872, announces that "the railroads to the oil regions have already put up their New York freight from $1.25 to 82.84, an advance of over one hundred per cent." Asked what reason the railroads gave for increasing their rates, a shipper said, "They gave no reason ; they telegraphed the local roads to put up the rates immedi- ately." This advance, the superintendents of the railroads told complaining shippers, had been made under the direc- tion of the Soutli Improvement Company, and they had been instructed to make their monthly collections of oil freights from that concern. The evidence even seems to show that the South Improve- ment Company was so anxious for the dance of death to be- gin that it got the freight agents by personal influence to order the increased rates before the time agreed upon with the higher officials. Strenuous efforts were made to have the public believe that the contracts, though sealed, signed, delivered, and put into effect, as the advance in rates most practically demonstrated, had really not been put into effect. The quibbles with which the president of the South Improve- ment Company sought to give that impossible color to the affair before tlie committee of Congress drew upon him more than one stinging rebuke from the chairman of the committee. " During your whole examination there has not been a direct answer given to a question." " I wish to say to you," said the chairman, " that such equivocation is unworthy of you." The plea needs no answer, but if it did, the language of the railroad men themselves supplies one that cannot be bettered. To the representatives of the people, who had telegraphed them for information " at once, as the excitement is intense, and we fear violence and destruction of property," General McClellan, of the Atlantic and Great Western, replied that the contract was "cancelled;" President Clark, of the Lake Sliore, that it was "formally abrogated and cancelled;" Chair- man Homer Eamsdell, of the Erie, that it was "abrogated ;" Vice-president Thomas Scott, of the Pennsylvania Eailroad, ALL TO BE TAKEN IN 51 that it was " terminated officially ;'" Yice-president Yanderbilt, of the New York Central and Hudson River Eailroad, tliat it was " cancelled with all the railroads." Contracts that were not complete and in force would not need to be "cancelled" and "abrogated" and "terminated." These announcements were backed up by a telegram from the future head of the oil trust then incubating, in which he said of his company : " This company holds no contracts with the railroad companies."' But in 1879 its secretary, called upon by the Ohio Legislature to produce the contracts the com- pany had with the railroads, showed, among others, one cov- ering the very date of this denial in 1872.' Before Congress the South Improvement Company sought to shelter themselves behind the plea that "their calculation was to get all the refineries in the country into the company. There was no difference made, as far as we were concerned, in favor of or against any refinery; they were all to come in alike." How they "were all to be taken in" the contract itself showed. It bound the South Improvement Company " to expend large sums of money in the purchase of works for refining," and one of the reasons given by the railroads for making the contract was "to encourage the outlay." Upon what footing buyer and seller would meet in these purchases when the buyer had a secret arrangement like this with the owners of the sole way to and from wells, refineries, and markets, one does not need to be "a business man" to see. The would-be owners had a power to pry the property of the real owners out of their hands. One of the Cleveland manufacturers who had sold was asked why he did so by the New York Legislature. Tliey had been very prosperous, he said ; their profits had been $30,000 to §45,000 a year ; but their prosperit}' had come to a sudden stop.' 'Xew York Assembly "Hepburn" Keport, 1879, Exhibits, p. 418. ° Report of the Executive Committee ot the Petroleum Producers' Union, 1872, p. 23. "Testimony, Ohio House of Representatives, 1879, p. 237. * Testimony, New York Assembly "Hepburn" Report, 1879, p. 2525. 52 STRIKING OIL " From the time that it was well understood in the trade that the Soutli Improvement Company had .... grappled the entire transportation of oil from the West to the seaboard .... we were all kind of paralj'zed, perfectly paralyzed ; we could not operate The South Improvement Com- pany, or some one representing them, had a drawback of a dollar, sometimes seventy cents, sometimes more, sometimes less, and we were working against that difference." ' It was a difference, he said, which destroyed their business. He went to the officials of the Erie and of the New York Central to try to get freight rates that would permit him to continue in business. "I got no satisfaction at all," he said; " I am too good a friend of yours," said the representative of the New York Central, " to advise you to have anything fur- ther to do with this oil trade." " Do you pretend that you won't carry for me at as cheap a rate as you will carry for anybody else?" "I am but human," the freight agent replied. He saw the man who was then busily organizing the Soutli Improvement Company. He was non-committal. " I got no satisfaction, except ' You better sell, you better get cleai-.' Kind of sui rosa : ' Better sell out, no help for it.' " His firm was outside the charmed circle, and had to choose between selling and dying. Last of all, he had an interview with the president of the all-conquering oil company, in rela- tion to the purchase of their works. " He was the only party that would buy. He offered nie fifty cents on the dollar, on the construction account, and we sold out He made this expression, I remember : ' I have ways of making money that yoii know nothing of.' " For the works, which were producing §30,000 to $45,000 a year profit, and which they considered worth §150,000, they received §65,000. '•' Did you ascertain in the trade," he was asked, " what was the average rate that was paid for refineries V 'Testimony, Kew York Assembly "Hepburn" Report, 1879, p. 2527. ONLY ONE BUYER 53 " That was about tlie figure Fifty cents on the dollar." " It was that or nothing, was it not ?" " That or nothing." The freight rates had been raised in February. This sale followed in three weeks. " I would not have sold out," he told the Legislature, " if I could have got a fair show with the railways. My business, instead of being an enterprise to buy and sell, became degraded into running after the railways and getting an equal chance with others." ' " The only party that would buy " gave his explanation a few years later of the centralization of this business. " Some time in the year 1872," he swore, " when the refin- ing business of the city of Cleveland was in the hands of a number of small refiners, and was unproductive of profit,'' it was deemed advisable by many of the persons engaged therein, for the sake of economy, to concentrate the business, and as- sociate their joint capital thei-ein. The state of the business was such at that time that it could not be retained profitably at the city of Cleveland, by reason of the fact that points nearer the oil regions were enjoying privileges not shared by refiners at Cleveland, and could produce refined oil at a much less rate than could be done at this point. It was a well-un- derstood fact at that time among refiners that some arrange- ment would have to be made to economize and concentrate the business, or ruinous losses would not only occur to the refiners tliemselves,-but ultimatelj'^ Cleveland, as a point of re- fining oil, would have to be abandoned. At that time those most prominently engaged in the business here consulted to- gether, and as a result thereof several of the refiners conveyed " to his company, then as always the centre of the centralization, " their refineries, and had the option, in pay therefor, to take stock " in this company, " at par, or to take cash." This com- pany, he continued, "had no agency in creating this state of things which made that change in the refining business neces- ' Testimony, Kes- York Assembly "Ilepburn" Report, 18'?9, pp. 2525-35. • See cb. xxxii. for " the state of tbe business " " unproductive of profit." 54 STRIKINO OIL sary at that time, but tlie same was tlie natural result of the trade, nor did it in the negotiations Avliieh followed use any un- due or unfair means, but in all cases, to the general satisfaction of those whose refineries were acquired, the full value thereof, either in stock or cash, was paid as tlie parties preferred." ' The producers were not to fare any better than the refiners. The president of the South Improvement Company said to a representative of the oil regions substantially: "We want you producers to make out a correct statement of the average production of each well, and the exact cost per barrel to pro- duce the oil. Then we propose to allow yon a fair price for the oil." "Within forty -eight hours after the freight rates were raised, according to programme, "the entire business of the oil regions," the Titusville Herald, March 20, 1872, reported, " became paralyzed. Oil went down to a point seventy cents below the cost of production. The boring of new wells is suspended, existing wells were shut down. The business in Cleveland stopped almost altogether. Thousands of men were thrown out of work." The people rose. Their uprising and its justification were described to the Pennsylvania Constitutional Convention of 1873 by a brilliant "anti-monopolist," "a rising lawyer" of Franklin, Venango Co. The principal subject to which he called the attention of his fellow -membei's was the South Improvement Company, and the light it threw on the prob- lems of livelihood and liberty. Quoting-the decision of the Pennsylvania Supi'eme Court in the Sanfoi-d case," he said : "That is the law in Pennsylvania to-day. But in spite of this decision, and in spite of the law, we well know that almost every railroad in this State has been in the habit, and is to-day in the habit, of granting special privileges to individuals, to companies in which the directors of such rail- roads are interested, to particular business, and to particular localities. ■\Ve well I?now that it is their habit to break down certain localities, and ' Standard Oil Company vs. W. C. Scofield et al. Court of Common Pleas, Cuyahoga County, 0. Affidavit of the President of the Standard Oil Compauy. ■ 1 1 Harris, LAW AND EEMEDT 55 build up others, to break down certaili men in business and to build up others, to monopolize certain business themselves by means of the numer- ous corporations 'whicli they own and control, and all this in spite of the law, in defiance of the law. "The South Improvement Company's scheme would give that corpo- ration the monopoly of the entire oil business of this State, amounting to $20,000,000 a year. That corporation was created by the Pennsylvania Legislature along with at least twenty others, under tlie name of improve- ment companies, witliin a few years past, all of which corporations con- tain the names as original corporators of men who may be found in and about the office of the Pennsylvania Railroad Company, in Philadelphia, when not lobbying at Harrisburg. The railroads took but one of those char- ters which they got from the Legislature, and by means of that struck a deadly blow at one of the greatest interests of the State. Their scheme was contrary to law, but before the legal remedy could have been applied, the oil business would have lain prostrate at their feet, had it not been pre- vented by an uprising of the people, by the threatenings of a mob, if you please, by threatening to destroj'' property', and by actually commencing to destroy the property of the railroad company, and bad the companies not cancelled the contract which Scott and Vanderbilt and others had entered into, I venture to saj' there would not have been one mile of railroad track left in the County of Venango — the people had come to that pitch of des- peration. . . . Unless we can give the people a remedj' for this evil of dis- criminations in freight, they will sooner or later take the remedy into their own hands."' Soon after this attorney for the people was promoted from the poor pay of patriotism to a salary equal to that of the President of the United States, and to the place of counsel for the principal members of the combination, whose inwardness he had descried with such hawk-eye powers of vision. Later, as their counsel, he drafted the famous trust agreement of 18S2. The South Improvement Company was formed January 2d. The agreement with the railroads was evidently already worked out in its principal details, for the complicated con- tracts were formally signed, sealed, and delivered January 18th. The agreed increase of freights went into effect Feb- ruary 26th. The pacific insurrection of the people began ' Debates of the Constitutional Convention of Pennsylvania, ISVS, v. 3, pp. 522-3. 56 STRIKING OIL with an impromptu mass-meeting at Titnsville the next day, February 27th. Influential delegations, or committees, on transportation, legislation, conference with press, pipe lines, arresting of drilling, etc., were set to work by the organization thus spontaneously formed by the people. A complete em- bargo was placed on sales of oil at any price to the men who had made the hateful bargain with the railroads. The oil country was divided into sixteen districts, in each of which the producers elected a local committee, and over all these was an executive committee composed of representatives from the local committees — one from each. K'o oil was sold to be used within any district except to those buyers whom the local committee recommended ; no oil was sold to be exported or refined outside the district, except to such buyers as the executive committee permitted. One cent a barrel was paid by each producer into a general fund for the expenses of the organization. Steps were taken to form a company with a capital of §1,000,000, subscribed by the producers, to advance money, on tlie security of their oil, to those producers who did not want to sell. Able lawyers were employed and sent with the committees to all the important capitals — Harrisburg, Washington, the offices of the railway companies. The flow of oil was checked, the activities of the oil world brought near a stop. Monday, March 15th, by the influence of the Washington committee, a resolution was introduced into the House of Eepresentatives by Representative Scofield, ordering an in- vestigation of the Soutli Improvement Company. Immedi- ately upon this the frightened participants cancelled the con- tracts. By the 26th of March the representatives of the people had secured a pledge in writing from the five great railroads concerned of " perfect equality," and '• no rebates, drawbacks, or other arrangements," in favor of any one there- after. March 30th, Congress began the investigation which brought to light the evidence of the contracts, and meanwhile the committees on legislation and pipe lines were securing THIRTY PIECES OF SILVER 57 from the Pennsylvania Legislatui-e the repeal of the South Improvement Company charter, and the passage of a " so- called " Free Pipe Line law, discovered af tervvai'ds to be worthless on account of amendments shrewdly inserted by the enemy. It was an uprising of the people, passionate but intelligent and irresistible, if tlie .virtue of the members held good. Un- til April 9th the non-intercourse policy was stiffly and suc- cessfully maintained. But by that time one man had been found among the people who was willing to betray the move- ment. Tliis man, in consideration of an extra price, violating his producer's pledge, sold to some of those concerned in the South Improvement Company a large quantity of oil, as they at once took pains to let the people loiow. The seller hoped to ship it quietly, but, of course, the object in buying and paying this additional price was to have it shipped openly, and the members of the South Improvement Company in- sisted that it should be done so.' This ti'eachery had the effect planned. Every one became suspicious that his neighbor would be the next deserter, and would get the price he would like to have for himself. To prevent a stampede, the leaders called a mass-meeting. Ee- ports were made to it of what had been done in Congress, the Legislature, and the other railway offices ; the telegrams al- ready referred to were read affirming the cancellation of the contracts. Amid manifestations of tumultuous approbation and delight the embargo on the sale of oil was declared raised. " We do what we must," says Emerson, " and call it by the best name possible." The people, as every day since has shown, grasped the shell of victory to find within the kernel of defeat. The committee of Congress noticed when the contracts were afterwards shown to it, that though they had been so widely declaimed to be "cancelled," they had not been can- celled, but were as fresh — seals, stamps, signatures and all — as ' Testimony, New York Assembly " Hepburn " Report, 1879, p. 2766. 58 STRIKING OIL the day they were made. This little circumstance is descrip- tive of the whole proceeding. Both parties to this scheme to give the use of the highways as a privilege to a few, and through this privilege to make the pursuit of liveliliood a privilege, theirs exclusively — the railroad oflBcials on one side, and their beneficiaries of the South Imijrovement Company on the other — were resolute in their determination to carry out their purpose. All that follows of this story is but the recital of the sleuth-like tenacity with which this trail of fabu- lous wealth has been followed. TJie chorus of cancellation from the railroads came from those who had meant never to cancel, really. In their nego- tiations with the representatives of the people tliey had con- tested to the last the abandonment of the scheme. " Their friendliness" to it " was so apparent," the Committee of the Producers reported, " that we could expect little considera- tion at their hands," ' and the committee became satisfied that the railroads had made a new contract among themselves like that of the South Improvement Company, and to take its place. Its head frankly avowed before the Investigating Com- mittee of Congress their intention of going ahead with the plan. " They are all convinced that, sooner or later, it will be necessary to organize upon the basis on which the South Improvement Company was organized, including both pro- ducers and refiners." This conviction has been faithfully lived up to. Under the name of the South Improvement Company the arrange- ment was ostentatiously abandoned, because to persist in it meant civil war in the oil country as the rising young anti- monopolist lawyer pointed out in the Constitutional Conven- tion. Mark Twain, in describing the labors of the mission- aries in the Sandwich Islands, saj's they were so successful that the vices of the natives no longer exist in name — only in reality. As every page will show, this contract no longer exists in name — only in reality. In the oil world, and in every ' Report of Executive Committee of the Petroleum Producers' Union, 1872. NOT IN NAME— ONLY IN REALITY 59 other important department of our industrial life — in food, fuel, shelter, clothing, transportation,' this contract, in its va- rious new shapes, has been kept steadily at work gerryman- dering the livelihoods of the people. The men who had organized the Soutli Improvement Com- pany paid the public revolt the deference of denial, though not of desistance. The company had got a charter, organized under it, collected twenty per cent, of the subscription for stock, made contracts with the railroads, held meetings of the directors, who approved of the contracts and had received the benefits of the increase of freights made in pursuance of tlie agreement. This "was shown by the testimony of its own officers.^ But " the company never did a dollar's worth of business," the Secretary of tho Light of the World told Congress,^ and " there was never the slightest connection between the Soutli Improvement Company and the Standard Oil Company," the president of the latter and the principal member of both said in an interview in the New York World, of March 29, 1890. " The South Improvement Company died in embryo. It was never completely organized, and never did any business. It was partly born, died, and was buried in 1872," etc. Still later, before a committee of the Legislature of New York, in 1888, he was asked about "the Southern Improve- ment Company." " There was such a company ?" " I have heard of such a company." " Were you not in it ?" "I was not."* So help me God ! At almost the moment of this denial in New York, an as- sociate in this and all his other kindred enterprises, asked before Congress who made up the South Improvement Com- 1 See ch. xxxiii. - Report Executive Committee Petroleum Producers' UDion, 1872. » Trusts, Congress, 18SS, p. 290. •• Testimony, Trusts, Nevr York Senate, 18S8, p. 420. 60 STRIKING OIL pany, named as among tbem the principal members of the great oil company, and most conspicuous of them all was the name of this denier.' The efficiency with which this " partly born " innocent lived his little hour, " not doing a dollar's worth of business," was told in a summary phrase by one of the managers of the Pennsylvania Kailroad, describing the condition of the oil business in 1873 : ' " All other of our largest customers had failed." When the people of the oil regions made peace after their uprising it was, as they say, witli "full assurance from the Washington committee that the throwing off the restrictions from trade will not embarrass tlieir investigation (by Congress), but that the Sub-Committee of Commerce will, nevertheless, continue, as the principle involved, and not this particular case alone, is the object of the investigation." ' The Committee of Commerce did not " continue." The principal witness, who had negotiated the contracts by which the raih-oads gave over the business of the oil regions to a few, refused in effect, beyond producing copies of the contract, to be a witness. Permission was given by the Committee of Con- gress during its first zeal to the Committee of Producers from Pennsylvania to copy the testimony as it was taken, but no official record of its discoveries exists. This transcript was published by the producers, and copies are possessed by a few fortunate collectors. The committee did not report, and in the archives of the national Capitol no scrap of the evidence taken is to be found. All has vanished into the bottomless darkness in which the monopoly of light loves to dwell. ' Testimony, Trusts, Congress, 1888, p. 289. 'TestimoDT, Commonwealtli of Pennsylvania vs. Pennsylvania Railroad Com- pany et al, 1879, p. '70'7. ' Report Executive Committee Petroleum Producers' Union, 1872. CHAPTER VI NotwithstAjSDing the ceremonial treaty of equal rights on the railroads to all, which had been secured by the uprising of the people against the South Improvement Company in 1872, the independents, one after the other, continued to be side-tracked by an unseen power. Four years later, on the 20th of July, 1876, their only two important survivors in Cleveland, frightened by the high death-rate of the busi- ness, and by a deepening pressure on themselves, answered a summons to come to the palace of the President of the Light of the World. The contract which was then made was afterwards produced in court.' It was called an " Agree- ment for an Adventure," in something like "the merry sport" in which the good Antonio gave a bond for a pound of his flesh. A few years after this "adventure" with his competitors and his ejfforts to have them closed by the courts, the President was asked if his trust had sought in any way to diminish the production of refineries in competition with it. "Oh no, sir," he rei^lied. " Nothing of the kind ?" "Oh no, sir." = He was asked the question again, and again the denial was repeated. " Done nothing of the sort ?" "Kot at all." ' Exhibit A, Answer of Defendants, Case of Standard Oil Company vs. W. C. Scofield et al, Cleveland, 1880. = Testimony, Trusts, New York Senate, 1888, p. 385. 62 "NOT TO EXCEED UALF'' But now he said, You must bind yourselves for ten years to refine onl}' 85,000 barrels of oil a year.' They had refined 120,000 barrels the year before, and coald have done 180,000, and were growing up with the countrj'. " The prospects were much better for the future." ' But they agreed. You must give me and my associates all the profits you make during this period above $35,000 a year, until we too have got $35,000 a year out of your business, and we will guarantee yon $35,000 a j'ear, if we let you run. They had made $41,000 the year Ijefore, bnt tliey agreed. You must divide with " us," after each has got $35,000 a year, all the additional profits. They had to put into this "adventure" all their buildings and machinery, valued at $61,T60.42, all their time and at- tention, and $10,000 in cash, while their conquerors put in only $10,000 cash and no plant and no time. Bnt they agreed to this demand for " half." You must stop refining altogether, and let us take out our $10,000 whenever we send you notice that through competi- tion, or a decrease or change in the production of petroleum, Cleveland can " barely compete " with other places. You must sell the kerosene you manufacture, and bu}' the petro- leum 3'ou make it of at the prices we fix. The combination could make the business unprofitable whenever it chose, and under the previous stipulation could close them up at its own pleasure, until the ten years had rolled by. But they agreed. You must resume again after any such suspension, and let us take half the profits whenever we give 3'oii notice. You must let us enter or withdraw, throw our $10,000 in or out, suspend or resume, again and again, as we choose ! They agreed. You must make us monthly reports of all your transactions. You must not enlai-ge nor contract 3"our works without our consent. Thej' agreed. ' Exhibit A, Answer of Defendants, Case of Standard Oil Conapany fs. \f. C. Scofield el al, Cleveland, 1880, Section 7. ' Affidavits of tlie defendants. " TBE BROTEER MANUFACTURER " 63 Toil must not go into the manufacture of petroleum, nor any other new business anywhere else in the world during this adventure! You must ship your products by such routes as we direct ! They agreed. You must keep this adventure secret. Our name must not appear, and even if you all die, yon must agree that we may continue the business in your name, or any other name we choose. " The firm name," as their counsel pointed out, " was to be l Testimony, Trusts, Congress, 1S8S, p. 647. 66 "NOT TO EXCEED JULF" of that greater field out of wliicli these competitors were barred altogetlier. Such contracts as these, its counsel said, were made with refiners all over the country. Tlie chief profit of the adventure lay, not in tlie divided profits of the picayune business it let the vassals do, but in the undivided profits of the empire kept for itself. Why should the recon- ciler hurry witli expensive lawyers into court for a summary injunction to prevent a "reconcilee" from making more oil, when the reconciler, who toiled not nor spun, was to get half of the gain of $2.05 on every barrel of it ? Why, but that every "co-operative" barrel so made would displace in the markets a barrel, all the profits of which went to it. The " reconcilees " were called into court. A judge was asked to issue an injunction forbidding them to depart from the strict letter of the contract. They have been refining more than 85,000 barrels of oil a year, was the complaint. They " threaten to distil crude petroleum without regard to quantity." ' They are " parties in rebellion," said the lawyers. The judge said, No. This is a contract in restraint of trade, and released those who were in its toils. The immediate effect of this "equalization" was an advance in the rates of profit. The year before the independent re- finers had made a profit of onlj^ 34 cents a barrel.' The first year of the "adventure" the profits jumped up to $2.52 a barrel. The dividends rose from 8^1,000 to $232,047, while the production fell from 120,000 to 88,085 barrels. For the four years the average profit was $2.05 a barrel, or 500 per cent, advance. The lowest profit was $1.37. " Eefiued oil advanced to an average of $8 per barrel for that year " (1876), says the counsel of the trust.' These great winnings were made in the depth of the de- pression following the panic of 1873. While a world -compelling decline not only of prices but • Petition for Relief and Injunction, Standard Oil Company !S. W. C. Scofield et at, etc. s Affidarits of the defendants. = Combinations, etc., S. C. T. Dodd, p. 25. "A. VERY SMALL PROFIT" 67 of profits, was ia progress, the authors of this arrangement kept up kerosene to a point at which $630,691 was made in four years out of an investment of $81,000, half of which went to those who put in $10,000 and their power over freight agents. This " adventure," as was said by the Hon. Stanley Mat- thews, who appeared as counsel for the victimized refiners, was better than a gold-mine. It was a mint. Without giving any personal supervision or any time, without any expendi- ture except the insignificant investment of $10,000, made as a mere stalking-horse, these men took a share of the profits of " the party of the second part," which is not to be calculated by ordinary percentage, but by multiplications, over and over again, every year, of the money they put in it. By reducing the volume of business one-half, by increasing the profit from 34 cents a barrel to $2.05, the reconcilers pocketed $315,345.58 in four years, on an investment of $10,000, with no work. This was the fact. The theory with which the fact was hidden from the people is given to the New York Legislature in 1888. The principle on which the trust did business, its president said, was : "At a limited profit; a very small profit on an extremely large volume of business." ' When its secretary was before Congress, he was asked about the operations of himself and his associates in these years, 1876, 1877, of wonderful profits. He had been participating during that time in not only this profit of $2.05 a barrel, but in di- vided profits rising to $3,000,000 in a year on $3,000,000 of capital, and in undivided profits which rolled up $3,500,000 of capital into $70,000,000 in five years. But he said : " The business during those years was so very close as to leave scarcely any margin of profit under the most advanta- geous circumstances." ' The effect on the consumer appears from the statement I Testimony, Trusts, Xew York Senate, 1888, p. 422. ^Tesiiraony, Trusts, Congi-ess, 18S8, p. 772. C8 ''NOT TO EXCEED HALF" in this case of one of the best- known producers and refiners in the oil regions, one intimately associated with the members of the combination. lie showed that oil which was selling at twenty cents a gallon retail could be sold at a large profit at twelve cents a gallon. As to the effect on the worliing-man, the demand for labor declined, wages went down, and the number of unemployed increased. When there was competition in Cleveland the great com- pany could not afford to have its skilled workmen idle, be- cause they would seek employment with the other refineries ; but now, having the refining business all in its own hands, when it was temporarily to its advantage to refine oil in Pitts- burg, Oil City, or other points, in preference to Cleveland, it could with impunity let its hands remain idle in Cleveland, knowing that when it wanted them it could easily secure them, as there are no other refineries in Cleveland to employ them, and " that has been a very serious injury to workingmen." ' There was no pretence that the design of this contract was not to make oil scarce — i.e., dear. In the affidavit which was made in support of the injunc- tion the principal reconciler showed that his company had restricted itself as much as it restricted these competitors. He urged as the reason why the contract had been made and why the courts should sustain it, that "the capacity of all the refineries in the United States is more than suflicient to sup- ply the markets of the world, and if all the refineries were run to their full capacity they would refine at least twice as much oil as the markets of the world require ; that this difference between the capacity of refineries and the demands of the market has existed for at least seven years past, and during that period the refineries " of his compan}' " have not been run to . . . exceed one-half of their capacity." When these surviving independents of Cleveland were forced into this adventure, in 1876, the source of the power ' Affidarit of Levi T. Scofield. PLAYINO TEETER 69 which could compel "free" citizens in this age of individual- ism to execute such a bond was not known. The appalling mortality among tlie independents showed that something was seriously wrong. There was something, however, in this "Agreement for an Adventure" which pointed straight to it. . That was a clause which guaranteed those who became vassals that they should have the same freight rates and get back the same rebates as the monopoly." "Had the monopoly the power," said the Hon. Stanley Matthews, " to procure freights on better and more advantageous terms than the rest of the public engaged in the same business ? . . . And if they had such power, how did it get it ? ... If tliis or any other cor- poration is allowed to exalt itself in this way and by these means above competition, it is also exalted above the law." The great lawyer, who soon afterwards became a justice of the Supreme Court of the United States, could not answer the questions he raised. The facts were hidden in secret con- tracts with the railroads. As regards Cleveland, they did not come out until five years later, in 1885. It then became an adjudicated fact that in 1875, the year before this " Agree- ment for an Adventure," the Lake Shore Eailroad had made a contract witli the oil combination to drive these very competitors and all others out of business, just as the same road had done for the South Improvement Company in 1872. When they escaped from their " reconciler," they brought this railroad and the contract into court. The case was fought up to the Supreme Court. That tribunal found that the Lake Shore road had con- tracted with this company to cany its products ten cents per barrel cheaper tlian for any other customers. It showed that this made a difEerence to the victims of the "Adventure'" equal to more than 21 per cent, a year on tlieir capital. " The understanding," the court said, " was to keep tiie price down for the favored customers, but uj) for all the others, and the inevitable tendency and eifect of this contract was to ' Exbibit A, etc., Section 12. 70 "NOT TO EXCEED HALF" enable the Standard Oil Company to establish and maintain an overshadowing monopoly, to ruin all other operators, and drive them out of business." The course of the railroad the court declai-ed to be one of "active participation in tlie un- lawful purposes " of the oil company. The Lake Shore was to have all its business out of Cleveland, but, a competing railroad being built, the Lake Shore made a contract to give this new line a part of the plum, to induce it to unite in the policy of keeping freights dovmx for the favored customer, and %ip for all others. When the President of the trust was asked afterwards by the New York Legislature if there had been no arrange- ment by which it got its transportation cheaper than others could, he replied, " No, sir." And later ho reiterated that in their arrangements for freight there was " nothing peculiar." ' But the Supreme Court of Ohio, in describing this arrange- ment, diversify the staid rhetoric of their legal deliverance with the unaffected exclamation : " How peculiar !" They declared the contract between the two railroads " void," and " not only contrary to a sound public policy, but to the lax demands of the commercial honesty and ordinarj- methods of business." They also pronounced the contract between the railroad and the oil company as " made to build up a monop- oly'," and as " unlawful." " The great lawyer, we have said, could not answer the ques- tions he asked. The facts, we have said, were hidden in a secret contract. And yet the answers to the questions, the facts, had been all brought to the verge of disclosure by tlie investigation by Congress early in tlie same year, 1876. Although the investigation, in consequence of the "I ob- ject "of the Hon. Henry B. Payne, of Cleveland,' had been referred to the Committee of Commerce, and though the rail- road and oil clique men would not answer, and tlie committee would not press them, there was a volunteer witness from 1 Testimony, Trusts, Xew York Senate, ISSS, pp. 3SS, 421. ^ Scofield ct al. vs. Lake Shore and Michigan Southern Kailn-ay Company, 43 Ohio State Report, p. 571. 3 Sec oh. xxvii. HIS BROTHERS KEEPER 71 Cleveland, who began to npset all the plans to smother. This willing witness was a Cleveland refiner, a shrewd man, as would easily be believed by those who knew that he was the brother of an organizer of the oil combination. lie, too, had been a member of it, but for some reasons was now " out," and was one of the swimmers who felt themselves being drawn down. He betook himself for relief to Congress. He dodged no subpoenas, but, going before the Committee of Commerce, he began to tell more fully than any other witness had ever done, or had ever been able to do, the stor}'' of the relations between the combination and the railroads, which he knew of his personal knowledge. When he began talking in this free way to the public authorities, his former associates saw that they had underestimated his abilities as a refiner. They be- gan to feel that it might be well to make some concessions to this particular brother, though not to the Brotherhood of Man. The investigation was summarily suspended," and his testi- mony was spirited away. With the only power that could have interfered thus silenced, the surviving independents were cori-alled as we have described. This was done two short months after the first move Avas made. May 16th, for the investigation which might have saved the independents at Cleveland and elsewhere from the dui-ess which drove men to death or adventures of reconciliation. All over the oil regions the combination has followed this policy of " not to exceed half." ' Nineteen pages of the testimony of a member in the suit begun by the Commonwealth of Pennsylvania are taken up with the operations of one of its constituent companies in the purchase or leasing of competing refineries, many of which were shut down or pulled down. This witness could name only one i-efinery out of the score of independent concerns once flourishing in Pittsburg, which was not under its control.' 1 See ch. xxvii. ' See Testimony, Trusts, Congress, ISSS, p. 800. = Commonweakh of Pennsvlvania vs. Pennsylvania Railroad et a!., 1879, Testi- mony, p. 472. 72 "NOT TO EXCEED HALF'' " Dismantled," was the monotonous refrain of many of his answers to the questions as to what had been done with the refineries thus got under controL Asked why these worlcs had been thus dismantled or shut down, he explained it vari- ously as due to unfavorable location or worn-out machinery M- some such disadvantage. If these works were so badly situated and so illy fitted for the business and so old, why did it purchase them ? " Can j'ou give good commercial reasons why it would buy all unj)rofit- able junk ?" he was asked.' " I cannot give any reason why they bought the works," was the helpless answer. From the beginning to the end the language used by the founders of the combination proves scarcity to have been their object. "There is a large number of refineries in the country — a great deal larger than is required for the manufacture of the oil produced in the country', or for the wants of the con- sumers in Europe and America," said one of the principal members in 1872.° This is almost identical with the language used in 1880 in the effort to enjoin Cleveland refiners who " threatened to distil." In 1887 we will see the same power putting its hand and seal to an agreement to enforce the doctrine that there was too much oil in the earth. In 1872 there were more refineries than were needed for the oil ; in 1887 there was too much oil. The progression is sig- nificant. And down to the present pool with the Scotch re- finers we will see the same men enforcing abroad, year by year, the same gospel of want.' "The producers in America are quite alive to the wisdom of not producing too much paraffine, and are already adopting measures to restrict it," said the chairman at the annual meet- ing of one of the principal Scotch companies.' ' Commonn-ealth of Pennsylvania, 1879, Testimony, p. 4C'0. -Report Executive Committee Petroleum Producers' Cnion, 1872. 2 See cli. xxxi. ■" Glasgow Herald, June 16, 1S92. CHAPTER VII In the obituary column of the Cleveland Herald, of June 6, 1874, was given the news of the death of one of the pio- neer manufacturers of Cleveland. He began tlie refining of petroleum in that city in 1860, several years before any of those who afterwards became tlie sovereigns of the business had left their railroad platforms, book-keeping stools, and law- yers' desks. He was married in the same year, and from that time until his death, in 1874, gave his whole life to his refinery and his family, and was successful with both. The Herald said of him editorially : " He was well known in Cleveland and elsewhere as a business man of high character. He was a prominent member of the First Presbyterian Church, was at one time President of the Young INIen's Christian Associa- tion, and was active in all enterprises of a religious and benevolent char- acter. He was about forty years of age, and leaves a wife and three children." His enterprise had been " very profitable," his wife said af- terwards in court, in narrating how she and her children fared after the death of the husband, father, and bread-winner. " ily husband devoted his entire energies and life to the business from about 1860 to the time of his death, and had acquired through his name a large patronage. My husband went into debt just before his deatli," she continued, " for the first time in his life. For the interest of ray fatherless children, as well as myself, I tliought it my duty to continue tlie business. I took S75,000 of riie 8100,000 of stock, and continued from that time, 1874, -until JSTovember, 1878, making handsome 74 " YOU ARE NOT TO RMFINE" profits, during perhaps the liardest business years of the time since my husband had begun." ' The business received from her the most thorougli and faith- ful attention, and she maintained tlie prosperity lier husband had founded by making a profit of about 825,000 a year. A representative of one of tlie oil combination came to lier, she continued, " with a proposition that I should sell to them." This agent was "a brother manufacturer," who, but a short time before in a conference with her, had agreed that in view of the dangers wliich seemed to threaten them, he and she should mutually watch out for each other, and that no arrange- ment should be made by eitlier without letting the other know. The next she saw of her ally he pounced upon her in her ofSce with the news that he was in the oil combination, that the head of it liad told him he meant to have control of the refining business if it took him ten years, but he hoped to have it in two. He went on to warm the woman's heart by the declaration that since lie liad become acquainted with the secrets of the organization he wondered that he and she had been able to hold out so long. After which preliminaries he proposed that she, too, should sell to it. With sagacity and spirit she declined point-blank to have anj' negotiation with him. She declined to deal with subordinates, and said she did not want to sell. The principal then called upon her at her resi- dence. This was in 1878, and these were dark days for " out- side" refiners. One by one they were sinking out of sight, and slipping under the yoke like the victims of the " recon- ciliation " and " equalization " described in the last chapter. For six years word had been passing from one frightened lip to another that they were all destined for the maw or the morgue, and the fulfilment of the word had been appalling. He knew the members of the oil combination, one of the best-known veterans of the oil region testified in this ease, naming them ; " I have heard some of them say, in substance, 1 Affidavit, Oct. 18, ISSO, Case of Standard Oil Company vs. W. C. Scofield et al, Cleveland, 18S0. THE WIDOWS CBUSE 75 ' that they intended to wipe out all the refineries in the country except their own, and to control the entire refining business of the United States.' " " The big fish are going to eat the little fish," one of the big fish told a neighbor and competitor. AVhen one of the little fish said he " would not sell and was not afraid," he was told, "You may not be afi-aid to have your head cut off, but your body will suffer !" The woman was brave with love and enthusiasm for the memory of her husband and the future of her children. She had had a great success, but she knew the sea she was swim- ming. She saw strong men going down on every side. She herself afterwards told in court of her great anxiet}' as she woi;ld hear of one refinery after another surrendering, feeling sure that that would eventually be the fate of her company. All that the witnesses just quoted had reported, all that was said of the same tenor by the witnesses before Congress in 1876, and much more, had been filling the hearts of the business men of Cleveland, Pittsburg, Titusville, New York, with a reign of terror ever since 1872. It was with a full realization of all this that she went down to her parlor to receive the great man of commerce, who passes the contri- bution-box for widows' mites outside the church as well as within. This gentleman was in her house in pursuance, prac- tically, of his own motion. She did not want to sell ; the suggestion of a sale had come from the other side. " I told him," the widow said to the judge, " that I realized that my company was entirely in the power " of his company. " All I can do," I said to him, " is to appeal to your honor as a gen- tleman, and to 3'our sympathy, to do the best with lue that you can. I beg of you to consider your wife in my position, left with this business and with fatherless children, and with a large indebtedness that my husband had just contracted for the first time in his life. I felt that I could not do without the income arising from this business, and I have taken it up and gone on, and been successful in the liardest years since my husband commenced." " I am aware," he replied, " of what 76 ''YOU ARE NOT TO REFINE" you have done. My wife could never have accomjjlished so much." She had become alarmed, the woman of business resumed, because his company was "getting control of all tlie refineries in the country." He promised, with tears in his eyes, that he would stand by her. It should never be said, he cried, that he had wronged the widow of his fellow-refiner. "He agreed that I might retain whatever amount of stock I desired. He seemed to want only the control. I thought his feelings were such that I could trust him, and that he would deal honorably with me." This was the last she saw of him. He promised to come to see her during the negotiations, but did not do so. He prom- ised to assist and advise her, but did not do so. He declined to conduct the negotiations with her in person as she re- quested, "stating to her," he said, in giving his version of the afEair to the court, " that I knew nothing about her business or the mechanical appliances used in the same, and that I could not pursue any negotiations with her with reference to the same ; but that if, after reflection, she desired to do so, some of our people familiar with the lubri eating-oil business would take up the question with her. . . . When she responded, ex- pressing her fears about the future of the business, stating that she could not get cars to transport sufficient oil, and other similar remarks, I stated to her that tliough we were using our cars, and required them in our own business, yet we would Ipan her any number she required, or do anything else in rea- son to assist her, and I saw no reason why she could not prosecute her business just as successfully in the future as in the past." This assurance to his widow-competitor that he would let her have cars was, of itself, enough to justify all her alarm, and show that there was no hope for her but in making the best surrender possible. It was proof positive that he did control the transportation, that the well-defined re- port that no one but he and his could get their business done by the railroad was true. Permission to go upon the highwaj-s by tlie favor of a competitor is too thin a plank for even a woman to be got to walk. Withdrawing from BT THE AGENT'S GONSGIEKCE 77 direct connection, but managing the affair to tlie end as be testifies, he sent back to her the agent she had refused to talk ■\vitli. jSTegotiations -were accordingly resumed perforce with this agent. He submitted to his piincipals a statement in her be- half of the value of the property, but did not waste time over the form of letting lier see it, or consulting with her before submitting it in lier name. This statement she never authorized, never heard of, and never read until it was produced in court against her.' One interesting feature of the contract which was the sub- ject of the " adventure " described in the chapter "Not to Exceed Half" was repeated here. The representative who " took up this matter " with the v/idow carried on his bar- gaining in great part with the minor stockholders, one of whom claimed afterwards that all he had done was under her directions, and "to her entire satisfaction." But she was entirely unaware of either her "directions" or her "sat- isfaction." " He never had the slightest authority from me to represent me in any way in the sale." " Another of the minor stockholders also busied himself in representing her without her knowledge. On behalf of the widow agents were making fignres, though she knew nothing of their agency or the figures. By these combined efforts a sale was finally concluded at figures which, though she owned seven-tenths of the property, she had never authorized, and were far below the only figures she had given as those she was willing to take. Compelled to deal with a subordinate against her will, fear- ing to remain in so hazardous an occupation, and jet needing for her children the income it brought her, this woman manu- facturer's position was most harassing. All through, as her cashier and treasurer told the court, she was dissatisfied, felt that she was compelled to sell though she wanted to retain her property. ' Affidavit, Nov. 17, 1880. ■ Affidavit, Nov. 30, 1880. 78 " YOV ARE NOT TO REFINE " " In my hearing," her confidential clerk said, " slie declared she sold because slie was compelled to do so." She told her fellow-stockholders that she had been informed by the agent wlio was dealing witli her, that if they did not sell out it would only be a question of time before they would be forced to sell out, as he intended to place oil like that made by her company in tlie liands of all their agents, to undersell them and close them out. This decided them to sell. " Inasmuch as the managers of the Standard Oil Company appeared to have made up their minds to obtain this property, and not to give them the chance they had before in competi- tion," the stockholders, as one of them testified, "concluded it better to sell the property at such price as they could then get, rather than to run the risk of a still greater loss in the future, not one of the stockholders desiring to part with the property at all, but rather choosing with fair competition to retain their interest in the property." ' She had made 15 per cent, in the last six months, and, aside from these threats, the business looked prosperous, for the orders were becoming more numerous every day. But the widow could refuse to sell only by braving threats which had broken more than two out of three of all the men about her. She put upon the property a price warranted by its income, §200,000, which was adopted by the directors of the company in a formal motion authorizing a sale at that figure. But in her name a proposition was made by the agent to sell for $71,000. " I never heard of the figure of 871,000," she says, " and cannot imagine where it originated. The only proposition that was ever made was that of §200,000." What the stock was worth in her estimation and that of her employes who had inside knowledge is seen in the evidence of her confidential clerk. Though he was her nephew also, he had with difiiculty, he says, bought stock at par. She had refused to sell at par to others. K ow the only ofEer she could get was §00,000 for the works and good-will, the > Affidavit, May 1, 1880. THE PUBLIC MUST NOT KNOW 79 purchasers paying in addition the cash vahie of the material in stock, and at that price she had to let them go. She asked to be allowed to remain an owner to the extent of $15,000 in the business into which she and her husband had built their lives. " No outsider can have any interest in this concern," was the reply. The combination " has dallied as long as it will over this matter," its agent continued. "It must be settled up to-day or go." The power of this business to produce a profit of $25,000 a year was worth almost $^00,000, according to the valuations maintained for the stock of the oil trust on the New York Stock Exchange by the men who bought out the widow. One hundred dollars in oil trust stock producing $12 a year lias sold as high as $185. If $12 a year was worth $185, $25,000 a year was worth nearly $400,000. It was part of the agreement that the oil company should go on as before. " It was particularly enjoined," testified the cashier and treasurer, " that the sale should be kept a profound secret." ' It was intended that the company should go on as before as far as the public was concerned. The purchasers agreed to continue to employ the hands already at work, but stipulated that not a word should be said to any one of them to reveal that the company was not as independent as it had been." " And you are not to engage in the refining business," is the concluding phrase of an agreement between the oil com- bination and a once competitor whom it had forced to sell out in 1876.' " Ton are not to engage in refining," the same power said in 1877 to the Pennsylvania Railroad, and now to this widow : You must sign this bond not to go into business again for ten years. The bond is given in full in the record of the case. It put the widow under a forfeit of five thousand dollars for ten years, that — ' See chapter " Not to Exceed Half." ' Affidavit, May 1, 1880. ^Commonwealth of Penns^'lvania m. Pennsylvania Railroad Company et ah. Testimony, p. 751. 80 " YOV ABE NOT TO REFINE " "I will not directly, or iudirectly, in any way, cither alone or in com- pany with anj- person, or as a share-holder in any corporation, engage in or in any way concern in}"self or allow knowingly any capital or moneys to be employed in the business or trade of refining, manufacturing, producing, piping, or dealing in petroleum, or any of its products, within the county of Cuyahoga, and State of Ohio, nor at any other place whatsoever." ' Their secret of success, the preeident swore in this very case, is " the very large volume " of purchases, " long continuance in the business," " experience," " knowledge of all the avenues of trade," '• skill of experienced employes," and so forth. But with all this they did not dare leave this middle-aged woman free to challenge them again on the field of competition. The purchase was made in the name of three members of the great oil company, and it was paid for by the check of that concern. Of these men one was among the " trustees " indicted and tried in ISSo for complicity in the plot to blow up a rival re- fineiy, but let go by the judge. At the time the sale was concluded the widow refiner de- clared, " The obtaining of her stock was no better than steal- ing." When the papers were brought to her to sign she " hesitated,"'" and said, " It is like signing my death-warrant. I believe it will prove my death-warrant." " The promises made by the joresident," she testifies, "were none of them fulfilled." Being only a woman, and not understanding " business," for all her brilliant success in stepping into her husband's place, and doing the double work of home-maker and bread-winner, the M"idow could not restrain herself from giving a most un- commercial piece of her mind to those who had got possession of her property for a sura which they would recover out of its profits in two or three years. She sent the following letter : " November 11, 1S7S, Blouday Morning. " Sm, — '\^'hen you lef t me at the lime of our interview the other morning, after promising me so much, you said you had simply dropped the remarks you had for my thought. I can assure you I have thought much and long as I have waited and watched daily to see you fulfil those promises, and it is impossible for me to tell you how utlerlj' astonished I am at the ' Exhibit A, Affidarit, October IS, 1880. JVDGMENTDA.Y LAW 81 course you have pursued with me. Were it not for the knowledge I have that there is a God in heaven, and tliat you will he compelled to give an account for all the deeds done here, and there, in the presence of my hus- band, will have to confess whether you have wronged me and liis fatherless children or not— were it not for this knowledge I could not endure it for a moment, the fact that a man, possessed of the millions that you are, will permit to be taken from a widow a business that had been the hard life work and pride of herself and husband, one that was paying the handsome profit of nearly twenty-five thousand dollars per annum, and give me in return what a paltry sum, that will net me less than three thousand dollars ; and it is done in a manner that says. Take this or we will crush you out. And when, on account of the sacred associations connected with the busi- ness, and also the family name it bears, I plead that I may be permitted to retain a slight interest (you having promised the same at our interview), you then, in your cold, heartless manner, send me word that no outsider can hold a dollar's worth of stock in that concern. It seems strange to be called an outsider in a business that has been almost entirely our own and built up at the cost it has to ourselves. It is impossible for us to find lan- guage to express our perfect indignation at such proceedings. We do not envy 3'ou in the least when this is made known in all its detail to the pub- lic. One of your own number admits that it is a great moral wrong, but saj's as long as you can cover the points legally you think you are all right. I doubt, myself, very much the legality of all these things. But do not for- get, my dear sir, that God will judge us morally, not legally, and should you offer him your entire monopoly, it will not make it any easier for you. I should not feel that I had done my entire duty unless, before I close, I drop a remark for your thoughts. In my poor way I have tried, by my life and example, with all those I have come in contact with in a business way, to persuade them to a higher, purer, and better life. I think there is no place in the world that one has such opportunities to work for good or evil as in a business life. I cannot tell you the sorrow it has caused me to have one of those in whom I have had the greatest hopes tell me, within the last few days, that it was enough to drive honest men away from the Chuich of God, when professing Christians do as you have done by me." In reply to this she received a letter in which her charge that her business had been taken from her was repelled as " a most grievous wrong," and " a great injustice." She was re- minded that two years before she had consulted with the writer and another member of the oil combination "as to sell- ino- out your interest, at which time yon were desirous of sell- ing at considerably less price, and upon time, than you liave now received in cash, and which sale you would have been glad to have closed if you could have obtained satisfactory 6 82 "YOU ARE NOT TO JiEFINE" security for tlie deferred payments. As to the price paid for the property, it is certainly three times grjcater tlian the cost at which we could now construct equal or better facilities." The letter concluded with an offer to return the works upon the return of the money, or, if she preferred, to sell her one hundred, or two hundred, or three hundred shares of the stock at the price that had been paid her. These propositions were left open to her for three days. The " cost of the works" is not the standard of value in such transactions. Six millions of dollars, according to a member of the committee of Congress which investigated the oil trust in 188S, is the value of the " works" on which they is- sued $90,000,000 of stock, which sold in the stock market at a valuation of $160,000,000. The offer to sell back the refinery was like tiie offer to let her have cars. To accept it was to pass openly and con- sciously into slavery. Two years before, when she was weak with grief, inexperience, and the fear that she might not succeed in her gallant task of paying her husband's debts and saving the livelihood of the children, she had thought of sell- ing out at a sacrifice. They knew this because she had asked their advice, and now cheapened her down by reference to the valuation of that moment of despair. All the life ener- gies of hei-self and her husband, the various advantages of position, the benefit of their pioneership since 1860, and of having established a place in so lucrative a business, all the good-will of customers, ail tlie elements that contributed to the ability to earn the nearly §25,000 a year she was making, were brushed out of the bargain by the mere assertion of a figure at which it was alleged better works could be built. By the time the offer was made she had, moreover, put the sum she had received into such investments, she told the court, as she had been able to find, and the money to accept the offer was no longer in her hands. Indignant with these thoughts, and the massacred troop of hopes and ambitions that her brave heart had given birth to, she threw the letter into the fire, where it curled up into fiames like those from which COURT RECORDS GONE 83 a Dives once begged for a drop of water. She never reap- peared in the world of business, where she had found no chiv- alry to help a woman save her home, her husband's life-work, and her children. But when the men who had divided her property among them invoked the assistance of the law to complete the "equalization" told of in the previous chapter, she went into court and told her story to save her friends from ruin. There, under the gathering dust of years, this incident has remained buried in the document-room of the Court of Common Pleas of Cuyahoga County, until now brought forth to give the people a glimpse into what the real things are which our professors of market philosophy cover with their glittering generalities about the cost of production and the survival of the fittest. This episode and that of the " Agreement for an Advent- ure " in the preceding chapter have been written up by the author from the original papers on file in the Court of Com- mon Pleas at Cleveland, which he visited for that purpose in 1891. Certified copies of the documents were procured from the clerk of the court. Lately, the astounding fact was ascer- tained that all the documents except two or three formal pleadings were gone from the records of the court. But for these certified copies there would now be no authentic record of these cases. This disappearance bears a strong likeness to the suppression of the investigation by the Committee of Commerce of Congress in 1872, and the theft of the testi- mony taken by the House Committee of Commerce ' in 1876, and the mutilation of the transcript submitted to Congress in 1888 of the evidence taken in the Buffalo Explosion Case.' ' See ch. xxvii. 'See cli. xviil and following. CHAPTER VIII "no!" TiiEKE has never been any real break in the plans revealed, "partly born," "and buried" in 1872. From then till now, in 1893, every fact that has come to the surface has shown them in full career. If tliey were buried, it was as seed is — for a larger crop of the same tiling. Tlie people had made peace, in 1872, on the pledge of "per- fect equality" on the higliways. Hardly had they got back to their work when they began to feel the pinch of privilege again. The Pennsylvania road alone is credited with any attempt to keep faith, and that only "for some months." " Gradualh'," as a committee of the people wrote to the man- agers of the Pennsylvania Pailroad, " tlie persons constituting the South Improvement Company were placed by the roads in as favorable a position as to rates and facilities as had been stipulated in the original contract with that company." ' As soon as pipe lines were proved practicable they were built as rapidly as pipes and men to put them in tlie ground could be had, but there was some lubricant by which they kept constantly' slipping into bankruptcy. They were " frozen out," as one of their builders said, "sum- mer as well as winter." By 1874, twenty pipe lines had been laid in the oil country. Eighty per cent, of them died ofE in that and the following year.° The mere pipes did not die, they are there j^et ; but the ownershijD of the many who had built them died. There were conservatives in the Held to whom competition 'TiustJ, Congress, 18SS, p. S03. 2 Testimony, New York AssemOlv "Hepburn" Report, 1879, p. 1693. EQUALITY THAT DOES NOT EQUALIZE 85 was as distasteful as to the socialists. To "overcome such competition," and to insure them "a full and regular" and "remunerative business" in pipe lines, in the language of the South Improvement Company contract, all that was needed was to put into operation the machinery of that contract which no longer existed — -in name. The decease of the name was not an insuperable obstacle. In exact reproduction of the plan of 1872, the railroads, in October, 1874, advanced rates to the general ruin, but to the pool of lines owned by their old friends of the South Improve- ment Company they paid back a large rebate. That those who had such a railroad Lord Bountiful to fill their pockets should grow rich fast was a matter of course.' Getting this refund they got all the business. Oil, like other things, follows the line of least resistance, and will not flow through pipes where it has to pay when it can run free and get something to boot. Nobody could afford to buy oil except those who were in this deal. They could go into the market, and out of these bonuses could bid higher than any one else. They " could overbid in the producing regions, and undersell in the markets of the world." " This was not all. In the circular which announced the bounty to the pet pipes tliere was another surprise. It showed that the roads had agreed to carry crude oil to their friends' refineries at Pittsburg and Cleveland without charge from the wells, and to charge them no more for carrying back refined oil to the seaboard for export than was charged to refineries next door to the wells and hundreds of miles nearer the market. "Outside" refiners who had put them- selves near the wells and the seaboard were to be denied the benefit of their business sagacity. The Cleveland refiners, whose location was superior only for the Western trade, were to be forced into a position of unnatural equality in the for- eio-n trade. In short, the railroads undertook to pay, instead of being paid, for what they carried for these friends, and 'Rutter Circular, Trusts, Congress, 18SS, p. 363. 2 Neiv York Assembly " Hepburn " Report, 1879, p. 44. 86 "NOr force tliein into an equality with mannfactnrers who liad builded better than they. Evidently tliej' who had contrived all this had their de- spondent moments, when they feai-ed that its full beneficence would not be understood by a public unfamiliar with the "science of transportation." To the now rules was attached an explanation which asserted the right of the railroads to prevent persons and localities from enjoying the advantage of any facility they may possess, no matter how " real." "You will observe that under this system the rate is even and fair to all parties, preventing one locality taking advan- tage of its neighbor by reason of some alleged or real facility it may possess." ' Meanwhile good society was shuddering at its reformers, and declaring that they meant to stop competition and " divide up property." " Do you do that in any business except oil ?" the most dis- tinguished railroad man of that day was asked. "Do j-ou carry a raw product to a jjlace 150 miles distant and back again to another point like that without charge, so as to put them ou an equality ?" To which he replied — it was he who could not remember that he had ever seen the South Improvement Company con- tract he signed in 1S72 — "I don't know." " " Could any more flagrant violation of every principle of railroad economy and natural justice be imagined than this?" the report of the New York Legislature asks." An expert introduced by the railroads defended this ar- rangement. He insisted that all pipe lines had a chance to enter the pool and get the same refund.* But a witness from tlie pipe-line country, who was brought to ITew York to testify to tlie relations of the railroads and the oil combination, let out the truth. ' Ratter CircuUr, Trusts, Congress, 1888, p. 303. = Testimony, Xew York Assembly " Hepburn" Report, 1879, p. 1596. = Same, Report, p. 43. < Same, Testimony, p. S429. OUR FlilEND—TME COMrJUTITOR 87 "Why didn't they go into the pool?" he was asked, in reference to one of the most important pipe lines. " Because they were not allowed to. They wanted to freeze them out. They were shut out from the market practically." ' For these enterprises, as they failed one after the other, there was but one buj^er — the group of gentlemen who called themselves the South Improvement Company in 1872, but now in the field of pipe-line activity had taken the name of United Pipe Line, since known as the National Transit Company, and then and now a part of the oil trust. " The United Pipe Line bought up the pipes as they became bankrupt one after another," testified the same friendly witness.' Then came a great railroad war in 1877. A fierce onslaught was made on the Pennsylvania Railroad by all the other trunk lines. In this affair, as in all dynastic wars, the public knew really nothing about what was being done or why. The newspapers were filled with the smoke of the battles of the railroad kings ; but the newspapers did not tell, for they did not then know, that tlie railroads were but tools of conquest in the hands of greater men. The cause of the trouble was that the managers of the Pennsylvania Railroad had begun to reach out for the control of the oil trade. They had joined in the agreement in 1872 to give it to the oil combination, but now tliey wanted it for themselves. Through a mistletoe corporation — the Empire Transportation Company — they set to work building up a great business in oil cars, pipe lines, i-efineries. " We like competition ; we like our competitors ; we are neighbors and friends, and have been all these years," the president of the oil trust testified to the New York Legis- lature,' but he served notice upon this competitor to abandon the field.* He and his associates determined to do more fhan compel the great railroad to cease its competition. They > Testimony, New York Assembly " Hepburn " Report, 1879, pp. 2792-95. 2 Same, p. 2795. ' Testimony, Trusts, New Yorlj Senate, 1888, p. 445. * Testimony, Commonwealth of Pennsylvania vs. Pennsylvania Railroad et a!., 1879, p. 670. 88 ''NOr determined to possess themselves of its entire oil outfit, though it was the greatest corporation then in America. Tliis, tlie boldest stroke yet attempted, could be done only with the help of the other trunk lines, and that was got. The ruling officials of the New York Central, the Erie, the Baltimore and Ohio, the Lehigh Yaliey, the Reading, the At- lantic and Great Western, the Lake Shore railroads, and their connections, were made to believe, or pretended to believe, that it was their duty to make an attack upon the Pennsyl- vania Eailroad to force it to surrender.' "A demand," says the New York Legislative Committee of 1879, "which they" — the railroads — "joined hands with the Standard Oil Com- pany and proceeded to enforce by a war of rates, which termi- nated successfully in October of that year " (1877).° The war was very bitter. Oil was carried at eight cents a barrel less than nothing by the Pennsylvania.' How low the rates were made by tlie railroads on the other side is not known. The Pennsylvania was the first to sue for peace. Twice its vice-president " went to Canossa," whicli was Cleve- land. It got peace and absolution only by selling its refineries and pipe lines and mortgaging its oil-cars to the oil combi- nation. It " was left without the control of a foot of pipe line to gather, a tank to receive, or a still to refine a barrel of petroleum, and without the ability to secure the transporta- tion of one, except at the will of men who live and whose in- terests lie in Oliio and New York." * It was only seven years since tlie buyers had organized with a capital of §1,000,000. Now they were able to give their check for over $3,000,000 for this one purchase. " I was sur- prised," said Mr. Vanderbilt to the New York Legislative Committee of 1878, speaking of this transaction, "at the amount of ready cash they were able to provide." They ' Testimony of A. J. Cas.-att, Commonn-ealth of Pennsylvania vs. Pennsylvania Eailroad et ah, 1879, pp. 666, 669, 671. ' Xew York Assembly " Hepburn" Report, 1879, p. 44. 2 Testimony, Commonwealth of Pennsylvania, etc., 1S79, p. 665. ' Appeal to the Executive of Pennsylvania, Trusts, Congress, 1888, p. 354. SECULAR TITHES 89 secured, in addition to the valuable pipe lines, oil cars, and refineries in New York and Pennsylvania, the more valuable pledge given by the Pennsylvania Railroad that it would never again enter the field of competition in refining, and also a contract giving the oil combination one-tenth of all the oil freights received by the Pennsylvania Railroad, whether from the combination or its competitors — an arrangement it succeeded in making as well with the New York Central, Lake Shore, and other railroads.' One of tiie earliest members of the oil combination was present at the meeting to consummate this purchase. Some- thing over §3,000,000 of his and his associates' cash changed hands. The meeting was important enough to command the presence of a brigade of lawyers for the great corporations, and of the president, vice-president, and several directors of the Pennsylvania Railroad, and, representing the Poor Man's Light, the vice-president, the secretary, and five of the lead- ing members of the combination, besides himself." But when asked in court about it he could not. remember any such meeting. Finally, he recalled " being at a meeting," but he could not remember when it was, or who was there, or what it was for, or whether any money was paid.^ Three years later this transaction having been quoted against the combination in a way likely to affect the decision of a case in court,* the treasurer denied it likewise. " It is not true as stated .... directly or indirectly. . . . " ' Eight years later, when the exigencies of this suit of 1880, in Cleveland, had passed away, and a new exigency demanded a "revised version," the secretary of the combination told Congress that it was true." " The pleasures of memory " are evidently for poets, not for such millionaires. That appears to be the only indulgence the}' cannot afford. ' Testimony, Commonwealth of Pennsylvania vs. Pennsylvania Railroad et ai, ISM, p. "735. 'Same, p. 672. ^ g^me^ p. 460. 'Seech, vi. "^ Standard Oil Company vs. W.C. Sco6eld el al. Affidavit of tlie treasurer of the Standard. ' Testimony, Trusts, Congress, 1888, pp. 7'71-72. 90 " NO I" The managers of the Pennsj'lvania road went back with the zeal of backsliders reconverted to their yoke in the service of the men who had given them this terrific whipping. They sent word to the independent refiners, whom they had se- cured as shippers by the pledge of 1872 of equal treatment, that equal rates and facilities could be given no longer. The producers and refiners did not sit down dumb under the death sentence. They begged for audience of their mastei"s, masters of them because masters of the highway. The tliird vice - president, the official in charge of the freight business, was sent to meet tliem. "As you know," they began by reminding him, "we have been for the past year the largest shippers of petroleum the Pennsylvania Railroad has had." He acknowledged it. " Shall we, after the 1st of May, iiave as low a rate of freight as anybody else?" they then asked. " ]^o," he said ; " after the 1st of May we shall give the Standard Oil Company lower rates than to you." "How much discrimination will we have to submit to?" the poor " outsiders " asked. " I decline to tell you," was the reply. " How much business must we bring your road to get as good rates as the combination V they tlien asked, and again — "' I decline to tell you," was the only answer they got. "If we will ship as much, will you give us as low freight rates ?" " We have been shipping over the Pennsylvania Railroad a year," the}^ persisted, " why can we not continue ?" "It would make them mad ; they are the only people who can make peace between the railroads." " I think," said he, "you ought to fix it up with them. I am going over there this afternoon to talk with those people about this matter, and," he continued, "you will all be happy, and everything will work along very smoothly." " We gave him very distinctly to understand that we did HIGHWAYS AND HIGHWAYMEN 91 not propose to enter into any 'fix up ' where we would lose our identity," or sell out, or be under anybody else's thumb ; we are willing to pay as high a rate of freight as anybody, and we want it as low as anybody has it," they told him. But the reply to all of it was, " You cannot have the same rate of freight." As the magnate of the railroad seemed to be determined not to permit them to move to market along his rails, one of the independents referred to a plan for a new pipe line then un- der consideration by them, the Equitable, as perhaps promising them the relief he refused. "Lay all the pipe lines you like," the vice-president re- torted, with feeling, " and we will buy them up for old iron." The independents appealed from the third vice-president to the president ; they had to beg repeatedly for a hearing be- fore they got it. They came together in the June following, the independents coming on from New York for the purpose. Since their interview with the third vice-president rates had been advanced upon them, and not only that, but when they had oil ready to ship at those high freight rates, the ra;ilroad on one pretext or another refused them cars. One of them had contracts to deliver oil from his refinery in New York to go abroad. When he ordered the cars that were needed to take the crude oil to New York to be refined they were re- fused him. The ships lay idle at the docks, charging him heavy damages for every day of delay ; at the wells his oil was running on the ground. " You had better go and arrange with the Standard Oil Company ; I don't want to get into any trouble with them," the president said. " If you are business men, you will make an arrangement with them. I will do all in \T\y power to bring it about." " We will never take our freight rates from them," the}' re- plied ; " we are not willing to enter into any such arrange- ment." " Why don't you go to the other roads ?" the president asked his suppliants. 92 "NOr "We have done so. It's of no use. On the New York Central the cars are owned by the combination, and the Erie is in a hke position. We liave been shippers on tlie Penn- sylvania Kailroad a long, long while, and j'ou ouglit to take care of us and give us all the cars we need. We are suffering very gi'eatly for the want of them. Can we have the same rate that other shippers get ?" "No." " If we ship the same amount of oil?" "No." "If you have not cars enough, will you, if we build cars, haul them V' " No. You will not have any peace or prosperity," continued the president, "until you make terms with the combination." Like the third vice-president lie offered to intercede with them to get transportation over his own road for his own cus- tomers. Like men tiiey refused the offei*. " We were, of course, very indignant," one of them said, in relating this experience in court.' A little-later a rich and expert refiner, who had sold out in 1876, made up his mind to try again. Tlie Pennsylvania road had a new president by this time, but the old " no" was still in force. " When I was compelled to succumb I thought it was only temporarily, that tlie time would come when I could go into the business I was devoted to. I was in love with the business. I took a run across the water ; 1 was tired and discouraged and used up in 1878, and was gone tliree or four months. I came back ready for work, and had the plan, specifications and estimates made for a refinery that would handle ten thousand barrels of oil in a day. I selected a site near three railroads and a river; I would have spent about five hundred thousand ^Kor the full report of these remarkable iaterviews with the President iuid Third Vice-President of the Pennsylvania Raili-oad see Testinionv, Investigation Peuns}-!- vania Secretary of Internal Affairs, 187S, pp. 47 et seq., 60 et scq. ; Testimony, Commonwealth of Pennsylvania vs. Pennsylvania Railroad et at., 1879, pp. 160 et seq., 204 et seq., 237 el scq. AN IMPRACTICABLE MAN 93 dollars, and probably a couple of hundred thousand more. I believed the time had arrived when the Pennsylvania Railroad would see their true interest as common carriers, and the interest of their stockholders, and the business interest of the City of Philadelphia. I called on the President of the Pennsylvania Railroad ; I laid the plans before him, and told him I wanted to build a refinery of ten thousand barrels' capacity a day. I was almost on my knees begging him to allow me to do that. " ' What is it you want ?' he said. " ' Simply to be put npon an equality with everybody else — especially the Standard Oil Companj'. I want you to agree with me that you will give me transportation of crude oil as low as you give it to anybody else for ten years, and then I will give 3'ou a written assurance that I will do this refining of ten thousand barrels of oil a day for ten years. Is not that an honest position for us to be in ? I as a manufacturer, you the president of a railroad.' " ' I cannot go into any such agreement.' " I saw the third vice-president. He said, in his frank way, ' That is not practicable, and you know the reason why.' " ' After their interviews with the President and Vice-President of the Pennsylvania Railroad, these outsiders went to the offi- cials of the other roads, only to hear the same "JSTo !" from all.^ At one time, to get oil to carry out their contracts and fill the vessels which were waiting at the docks and charging ihem damages for the delay, these refiners telegraphed to the oil re- gions offering the producers there ten cents above the market price if they could get oil to them over any of the roads to New York. They answered they could not get the cars, and none of them accepted the offer.' All the roads — as in 1872 — were in league to "overcome" them. ' Testimony, Tiusts, Congress, 1888, pp. 223-2fi. ^Testimony, Investigation, Pennsjlviinia Secretary of Internal Affairs, 1S7S, pp. 49, 59; Testimony, New York Assembly "Hepburn" Report, 1879, pp. VIO, 3548-56; Exhibits, same, p. 176; Testimony, Commonwealtli of Penusylrania vs. Pennsylvania Kaihoad et al, 1879, p. 247. 'Testimony, Xew York Assembly " Hepburn" Report, p. 712. 94 . <'Nor Thus, at a time wlien the entire movement of oil was at the rate of only 25,000 or 30,000 barrels a day, and the roads had cars enough to move 60,000 barrels a day, these independent refiners found themselves shut completely off from the high- way.' The Pennsylvania Kailroad, the New York Central, the Erie, and their branches and connections in and out of the oil regions, east and west, were as entirely closed to them as if a foreign enemy had seized the country and laid an em- bargo on their business — which was, indeed, just what had happened. The only difference between that kind of invasion and what had really come was, that " the dear people," as the president of the trust called them," would have known they were in the hands of an enemy if he had come beating his drums loud enough, and firing off his two-thousand pounders often enough, and pricking them deep enough with his bay- onets ; but their wits are not yet up to knowing him when he comes among them disguised as an American citizen, although they see property destroyed and life lost and liberty thrown wherever he moves. There was enough virtue in Pennsylvania to begin a suit in the name of the State 'against the men who were using its franchises for such purposes, though there was not enough to push it to a decision. The Third Vice-President of the Penn- sylvania Railroad, when examined as a witness in this suit, confirmed these statements about the interviews with himself and the president of the road in every particular about which he was questioned. "We stated to the outside refiners that we would make lower rates to the Standard Oil Company than they got ; we declined to allow them to put cars of their own on the road." ' His evidence fills seventy-six pages, closely p)-inted, in the report of testimony. It was clear, full, and candid; remark- ' Testimony, New York Assembly " Hepburn " Report, 1879, p. 720. - Testimony, Trusts, New York Senate, 1888, p. 445. ' Testimony, Commonwealth of Pennsylvania vs. Pennsylvania Railroad et al., 1879, pp. 725-26. "SE DECLINES AKD FALLS" 95 ably so, considering that it supplied officially from the com- pany's own records the facts, item by item, which proved that the management of the Pennsylvania Railroad had violated the Constitution of Pennsylvania and the common law, and had taken many millions of dollars from the people and from the corporation which employed them, and secretly, and for no consideration. Lad given them to strangers. This testimony is so important that it was reprinted sub- stantially in full both by the "Hepburn" committee of the New York Legislature in 1879 ' and the Trust Investigating Committee of Congress in 1888.' As instances, it showed that in one case where the rate to the public was $1.15, this favored shipper was charged only 38 cents. In another case the trade generally had to pay $1.40 a barrel on crude petro- leum, but the oil combination paid 88|^ cents. " And then the refined rate was 80 cents ?" " 80 cents net to the Standard." "And to all others?" "$1.44*." " But there were no other outside shippers," he pleaded — how could there be? There was only one important member in Pennsylvania of the oil combination who could be caught with a subpoena. At his first appearance in court, on the witness stand, he took lofty ground. " I decline to answer." ^ Put on the stand again, he was asked : ""Were you allowed a rebate amounting to 64^ cents per barrel?" " jSTo, sir ; not to my knowledge." * Put on the third time and compelled to produce his books, he had to read aloud in court the entries showing the payment he had thus denied under oath. "' There was a total allowance of 64^ cents per barrel."^ ' ' Exhibits, pp. 453-514. " Testimonv, pp. 174-20'?. ' Testimony, Commonwealtb of Pennsylvania vs. Pennsylvania Railroad ct al, 18T9, p. 11. ^Same, p. 352. 'Same, p. 510. 96 "NOr And then he shut np again — but too late; and to all other questions about his rebates said, gloomily, " 1 decline to an- swer." When the president of the oil trust was asked afterwards by the New York Legislature if some company or companies embraced within it had not enjoyed from railroads more favorable freight rates than outside refineries, he replied : " I do not recall anything of that kind." " You have lieard of such things ?" " 1 have heard much in the papers about it." ' But at the time these rates were being made, one of his principal associates admitted that the president was the per- son who attended to tlie freight rates.' Tliis was also put beyond a doubt in the Ohio investigation by the evidence of his first partner in the little oil refinery at Cleveland which had grown so great, he who had furnished the only mechanical and refining knowledge it had started with, and who had, un- til within a year, been a fellow-stockholder and director. " Do these contracts contain anything of the nature that would discriminate against the small refiners of the State?" " I think they did. . . . Up to the time I left the company the open rate was §1.40 to the seaboard. They" — the oil com- bination — -"ship for 80 cents. . . . The president told me it was the rate at that time." ° With every known avenue to the sea thus closed to them it certainly looked as if all was up with the " outsiders." But the men, who had too much American spunk to buy peace with dishonor by consenting to a "fix-up" under compulsion, had the wit to find out a loop-hole of temporary escape. They built tank boats for the canal, and thus succeeded in getting 200,000 barrels of oil to New York tliat summer before the canal closed.* ' Testimony, Trusts, New York Senate, 1888, p. 420. - Testimony, Commonwealth of Pennsylvania vs. Pennsylvania Kailroai] ci ai, 1S79, p. 374. ^Testimony, Discriminations in Freight Rate.=, Ohio House of Representatives, 1S79, pp. 1S1-S3. * Testimony, Xew York Assembly "Hepburn" Report, 1S79, p. 800. FSITA TE III6RWA TS 97 Since then all chance of escape by the canal has been cut off. The railroads made a war of freight rates against it, and the only canal that connected the oil regions with the Erie canal route to the sea was dried up, and turned into a way for a railroad by a special act of the New York Legis- lature. The railroad so built has ever since been managed as one of the most diligent promoters of the policy of exclud- ing the common people from the oil business. According to the funeral notices given out by the railroad officials and the members of the South Improvement Com- pany tliis concern was dead, but in the quaint phrase of the producers it was really alive and hard at work, but " with a new suit of clothes and no name." These interviews between the independent refiners and the railroad officials of the three trunk lines form one of the most extraordinary scenes which have taken place between a government and its subjects since the era of modern democratic liberty. The railway officials are, in the world of the highway, the government. They hold their supreme power to tax com- merce, and to open and close the highways, solely and alto- gether by grant of the State, and under tlie law of the com- mon carrier. It is only by the exercise of the sovereign power of eminent domain to take the property of a private individual by force, vrithout his consent, for public use — never for any other than public use — and only by the grant of the right to cross city streets and country roads that the rail- roads come into existence at all. This says nothing of the actual cash given to the railroad projectors by the govern- ment, which, in New York State alone, amounts to upwards of 8*0,000,000.' The independent refiners represent the people, claiming of the highway department of their government those equal rights which all citizens have as a birthright, and the govern- ment informs these citizens that their rights on the highways liave been given as a private estate to certain friends of the ' Exhibits, New York Assembly "Hepburn " Report, 1879, pp. 238-45. 1 98 "Nor ruling administration, mncli as "William the Conqueror would give this rich abbey or that fertile manor to one of his pets. "We have no franchise that is not open to all," say the "trustees." "It is a free open market." "There is nothing peculiar to our companies." " It is as free as air." In truth they have had no less a franchise than, as in 1872, the excluding possession of all the great trunk-lines out of the oil country, and all their connections east and west, and this franchise has since widened until, in 1893, it reaches from ocean to ocean, and from gulf to gulf. Their franchise was meant to be as exclusive as if they had had from the government letters-patent in the old royal fash- ion of close monopolies in East Indian trade, or salt, or tobacco at home, giving them by name the sole right to use the roads, and forbidding all others, under pain of business death, from setting their foot on the highway. But with this difference: the exclusive franchise in the latter case would exist by law ; but in this case it Avas created in defiance of law, exists in contempt of the law, and in its living the law dies daily. The refiners and producers who were pleading in this way with the railroads for a chance to live after May 1, never doubted but that, as they were told, and as their arrange- ments with the Pennsylvania road guaranteed, they were hav- ing and were to have at worst until that date, equal and im- partial rates and facilities. Under this safe- conduct they parleyed for the future. But the Pennsylvania Railroad was at that moment negotiating with the oil combination to collect from the independents, under the guise of freight, 20 to 22^ cents a barrel on all they sent to market, and pay it over to the combination. The payments were made to one of the rings within the oil ring, called the American Transfer Company. " It is the same instrumentality under a different name," said the counsel of the New York Chamber of Commerce before the New York Legislature. The official of the Pennsylvania road who issued the order to take this money out of the treasury pleaded in excuse that pi-oof had been given him that THIltTT DOLLARS FOR ONE EVERY TEAR 99 otlier roads were doing the same thing." Eeceipted bills were brought to liim, showing that the New York Central and the Erie had been " for many months " paying these men who called themselves American Transfer Company for having " protected " their oil business, sums ranging from 20 cents to 35 cents a barrel on all the oil those roads transported.^ So deeply was the watch-dog of the Pennsylvania road's treas- ury affected by the proof that his company was doing less than the other roads, that he instructed the comptroller to give these men three months' back pay, which was done. Twenty cents a barrel was sent them out of all the oil freights collected by the Pennsylvania for the three months preceding, and there- after the tribute was paid them monthly. Then it was in- creased to 22^ cents a barrel. The same amount per barrel was refunded to them out of their own freight. They received this on all oil shipped by them, and also on all shipped by their competitors.' They who received this tribute pretended to the railroad officials that they " protected " the roads from losing business. The railroad men pretended to believe it. The way in which this revenue was given and got shows what a simple and easy thing modern business really is — not in any way the brain-racker political economists have per- suaded themselves and us. The representative of the oil combination writes a bright, cheery letter ; the representative of the Pennsylvania answers it, and there you are ; 22^ cents a barrel on millions of barrels flows out of the cash-box of the railroad into the cash-box of the combination. In one year, 1ST8, this tribute, at the rate of 22^ cents on the 13,750,000 barrels of oil shipped by the three trunk-lines, must have amounted to $3,093,750. The American Transfer Company 'New York Assembly "Hepburn" Report, 1879, Exhibits, pp. 479-514. 2 This was always denied by the New York Central. "I never heard of the American Transfer Company," Vanderbilt told the New York Legislature. " I don't know that we ever paid the American Transfer Company a dollar. If we did, I have no knowledge of it." New York Assembly " Hepburn" Report, ISVS, p. 1077. ' Testimonv, Commonwealth of Pennsylvania vs. Pennsylvania Railroad d ah, p. 702. Same, Exhibits Nos. 45-47, pp. 732-33. 100 "NOP' had a little capital of $100,000, and its receipts from this re- bate in this one year would amount to dividends of 3093 per cent, annually ; the capital of the oil combination which owned this Transfer Company was at this time $3,500,000. There are reasons to believe that some of the very railroad men who turned the money of the railroads over to the American Transfer Company were among its members. But if all the profit went to the combination, and none of it was for the railwaj' officials through whom they got it, their revenue from that source alone would have paid in 1878 a dividend nearly equal to this capital of $3,500,000. In this device of the American Transfer Company we again see reappear in 1878, in high working vitality, the supposed corpse of the South Improvement Company of 1872. The American Transfer Company was ostensibly a pipe line, and the railroad officials met the exposure of their " nothing peculiar " dealings with it by asserting that the payment to it of 22^ cents a barrel and more was for its service in collecting oil and delivering it to them; but the Third Vice-President of the Pennsylvania Kailroad admits that his road paid the money on oil which the American Transfer Company never handled. " This 22|- cents (a barrel) paid the American Transfer Com- pany is not restricted to oil that passed througli their lines ?" " No, sir ; it is paid on all oil received and transported by us." ' The American Transfer Company was not even a pipe line. By the Pennsylvania laws all incorporated pipe lines must re- port their operations and condition monthly to the State. But the publisher of the petroleum trade reports, and organizer of a bureau of information about petroleum, with offices in Oil City, London, and New York, issuing daily reports, testi- fied that the American Transfer Company was not known in the oil regions at all as a pipe line. It published none of the statements required by law. " They do not," he said, " make any runs from tlie oil-wells." It had once been a pipe line, ' Commonwealth of Pennsylvania vs. Pennsylvania Railroad et at, 1879, p. 691. NOT ENOUGH FOR TSE GLAMOREB 101 but " years ago it was merged in with other lines," and consoli- dated into the United Pipe Line, owned and operated by the combination.' When this arrangement was exposed to public view by the New York legislative investigation, the "expert" who ap- peared to explain it away in behalf of the railroads and their beneficiaries, paraded a false map of the pipe-line system, drawn and colored to make it seem that the American Trans- fer Company was a very important pipe-line." This was the same " expert " who, as we saw, defended the pipe-line holo- caust of 1874 by asserting that "all were to be taken in alike." There are three kinds of liars, an eminent judge of ISTew York is fond of saying — liars, damned liars, and experts. When the assistant secretary of the oil combination was asked about this " transfer " company, he replied, " I don't know anything about the organization."' He had described himself to the committee as '"a clamorer for dividends"; but he declared he knew nothing about an organization which was "transferring" him dividends at the rate of $3,093,750 a year on $100,000 of capital. Almost at the very moment of this denial, receipts were being produced in court in Pennsylvania which had been given by the cashier of himself and his asso- ciates to the railroads for this money.* Even if the independents succeeded in saving their oil from wasting on the ground, and got it into pipe lines, and had it refined, and were lucky enough to be given cars to carry it to the seaboard, they found that in leaving the oil regions they had not left behind the "no." Up to the very edge of the sea were the nets spread for them. Part of the bargain of 1872 had been that the brothers of the South Improvement Company should provide the ter- minal facilities at the seaboard.' Railroad companies are usu- > Testimony, New York Assembly "Hepburn" Report, ISTO, pp. 8666-69. sSame, p. S959. = Same, p. 2664. 'Testimony, Conimonwealth of Pennsylvania vs. Pennsylvania Railroad et ai, 1879, pp. 656-57. ' Art. 1, sec. 4. 102 "JVO/" ally supposed to have their own yards, storehouses, wliarves, and the like, and, as a matter of fact, the railroads had these. .The agreement of 1872 that the South Improvement Company should furnish the terminal facilities meant — it was discov- ered by the New York Legislature in 1879 — that such ter- minals as the road already liad should be turned over to that concern, and that thereafter nobody should be allowed to build or use terminals except as it permitted. Tlie New York Legislature found, in 1879, that the oil combination thus owned and controlled the oil terminal fa- cilities of the four trunk-lines at New York, Philadelphia, and Baltimore. " They can use the power here given, and have used it to crush out opposition." ' " Of course, there is in the Erie contract a statement that ev- ery shipper of oil over the road shall be treated with 'fairness ' by the Standard Oil Company, and our attention was drawn to that," the counsel of the Chamber of Commerce said. . . . " In the first place, they have the exclusive shipment of oil, and therefore nobody could ship oil, and there was no oil handled for anybody else; but if the Erie Companj' should send some for somebody else, why, the sloop could not get to the dock, and the machinery at the dock would not and could not work by any possibility so as to get that oil out of that dock and into a ship (except at the end of a lawsuit)." ' Evidently the " cancellation " of 1872 had not cancelled any- thing of substance. Indeed, the " no " of 1878 was wider than the embargo of 1872, for the fourth great trunk-line, the Balti- more and Ohio, was not one of the signatories then ; but b}' 1878 it had, like all the others, closed its port to the people — farming it out as the old regime farmed out the right to tax provinces. He used to meet the president of the oil combination '■ frequently in the Erie ofiice," a friend and subordinate has ' Xew York Assembly "Hepbui-n" Report, 1879, pp. 40-44. - Speech of Simon Sterne, counsel of llie Xew York Cliamber of Commerce, be- fore New York Assemblv "Hepburn" Committee, 1S79, p. 39G4. PRIVATE PORTS 103 recalled.' Kailroad offices are pleasant places to visit wlieu such plums are to be gathered there as this of the sole i-ight to the freedom of all ports and conti-ol of the commerce of three continents. Down to this writing, when the little group of independents who remain masters of their own refineries along Oil Creek seek to send tlieir oil in bulk abroad, or to transship it at any one of the principal ports for other points on the coast, the same power still says the same "no" as twenty years ago.' ' Testimony, same, p. 2112. ' See cb. xi. CHAPTER IX WHO PIPED AST) WHO DANCED Thus, by 1878, the independent producers and refiners found themselves caught in a battue like rabbits driven in for the sport of a Prince of Wales. If the richest person then in America — tliat artificial but very real person the Pennsylvania Railroad — could not keep its pipe lines, nobody could. Tlie war for the union, which ended with its surrender in 1877, closed the pipe-line indus- try to the people. The unanimous "no" of all the railroads which followed completed the corral. Oil, when it got to market, found that those who had be- come the owners of the pipe lines were also the owners of most of the refineries, and so the only large buyers.' " Prac- tically to-day there is but one buyer of crude oil for us. . . . We take our commodity to one buyer ; we take the price he chooses to give us without redress, witli no right of appeal."' '' Then the sole carrier — the pipe-line company — refused to take the oil into its pipes — the oil as it came out of the wells —unless first sold to its other self, the oil combination. This was called "immediate shipment." Forced to waste or sell his oil, the producer, under this compulsion, had to take what he could get.^ The Hon. Lewis Emer}', Jr., a member of the State Senate of Pennsylvania, gave the authorities of the State an account of the " immediate shipment " evolution ' New York Assembly "Hepburn" Report, 1S79, p. 44. ' Testimon}', Commonwealth of Pennsylvania vs. Pennsylvania Railroad et al., 1S19, pp. 302, 314. 'Testimony, same. Pipe Line Appendix, pp. 36-37; Investigation, Pennsyl- vania Secretary of Internal Affairs, 1S78, pp. 19, 29. EVOLUTION OF VOLCANOES 105 of American market liberty. " We go down," lie said, " to the oflBce and stand in a line, sometimes half a d&y — people in a line reaching out into the street — sixty and seventy of us. When our turn comes we go in and ask them to buy, and they graciously will take it. I am an owner in six difEerent com- panies, and we all suffer the same." To educate the producer to sell " always below the market," the Pipe Line let his oil spill itself on the ground for a few days. " We lost a considerable amount of oil, probably several thousand barrels," another producer said. "Will you state at what price as compared with the mai'ket price, whether above or below, you sold that oil ?" " It was always below." Asked why he sold it below the market, he said : " Because the line would not run it until it was sold." ' The hills of Pennsylvania began to growl and redden as in 1872. The Secretai-y of Internal Affairs was hung in effig3^ Mass meetings were held — some tumultuous, others quiet; pro- cessions of masked men marched the streets, and groaned and hooted in front of the newspaper offices and the business places of the combination. In the morning the streets and sidewalks were frequently found placarded with cabalistic signs and letters, and occasionally printed proclamations and warnings. Most of the leading newspapers of the region had been either absolutely purchased by the oil combination or paid to keep silence. Others occasionally broke forth in vio- lent articles advising the use of force.'' In the McKean County field the people rose in rebellion. Thej' got up a Phantom Party, in its provocation and spirit much like a phantom party which, contrary to law and order, boarded some ships in Boston harbor a century before. One thousand men, wrapped in white sheets, marched by night ' Testimony, Commonwealth of Pennsylvania, etc., 1S79, Pipe Line Appendix, pp. 36-37; Investigation, Pennsylvania Secretary of Internal Affairs, 1878, pp. 19, 29, 32, 42. 'A History, etc. Trusts, Congress, 1888, pp. 690, 697, 705, 706. 106 WHO PIPED AND WHO DANCED from Tarport to Bradford, the lieadquarters in that province of the sole buyer. Not a word was spoken. It was not enough to make the people sell under compul- sion. A day came when the only buyer would not buy and the only piper would not pipe. This brought the Parker dis- trict to the verge of civil war. The citizens were in a state of terrible excitement; the pipe lines would not run oil unless it was sold ; the only buyers — viz., the agents of the oil combi- nation — would not buy oil, stating that they could not get cars ; hundreds of wells were stopped to their great injury. Thou- sands more, whose owners were afraid to stop them for fear of damage by salt water, were pumping the oil on the ground. The leaders used all the influence they had to prevent an out- break and destruction of railroad and pipe lines. The most important of them went over to the Alleghany Yalley Railroad office and telegraphed to the president: "The refusal to run oil unless sold upon immediate shipment and of the railroad to furnish cars has created such a degree of excitement here that the most conservative part of the citizens will not be able to control the peace, and I fear that the scenes of last July will be repeated on an aggravated scale." ' Three of the highest officials of the road sought an imme- diate interview with this leader of the producers. He warned tliem, and the Pennsylvania road which controlled their oil business, that unless immediate relief were furnished there would be an outbreak in the oil regions, because, as lie told them, " The idea of a scarcity' of cars on daily shipments of less than 30,000 barrels a day was such an absurd, barefaced pretence, that he could not expect men of ordinary intelli- gence to accept any excuses for the absence of cars, as the preceding fall, when business required, the railroads could carry day after day from 50,000 to 60,000 barrels of oil." " The warning was heeded. Thousands of empty cars, which the combination and its railroad allies had said couldn't be ' Testimony of B. B. Catnpbell, Commonwealth of Pennsylvania vs. Pennsylvania Kailroad et al, pp. 29S-99. 5 game, p. 300. OHIO, TOO 107 had anywhere, suddenly appeared hastening to Parker, block- ing up the tracks in all directions, deranging the passenger business of the road. "They looked like mosquitoes coming out of a swamp." The sole buyer began buying again, and for the whole week, after having declared themselves unable to buy or move any, the railroads moved 50,000 barrels a day." Producers under such rule saw their prices decrease and their land pass out of their possession, as was inevitable. Ten years later in the Ohio oil-field all the substantial feat- ures of the plan we saw culminate at Parker are to be found in full play. There, also, the oil combination, Congress was told, is the only purchaser, and it fixes the price to suit itself. The production of the Ohio fields was between 18,000 and 20,000 barrels a day, but it could easily produce between 30,000 and 33,000. Because the only buyer refused to take care of the oil, wells have been shut back. Wells, which if opened up would run 1000 or 2000 or even more, were shut in four days out of the week." This culmination of 1878 made the people act. The pro- ducers were being ground to powder by the fact that an enemy had possession of their local pipes, their tankage, and their railways. "I am the unfortunate owner," said one of them, "of interests in nearly one hundred pumping wells. I have produced over half a million barrels of oil." ^ Oil was run- ning out of the ground at the rate of 15,000,000 barrels a year, but the New York refiners who were in command of plenty of capital, said : " We don't dare build large refineries, for we don't know where we could get the oil." ' At last the people organized the Tidewater Pipe Line. This was the first successful attempt to realize the idea often broached of a pijje line to the seaboard. It was the last hope 1 Testimony of B. B. Campboll, Commonwealth of Pennsylvania vs. Pennsylvania Railroad el al., p. 300. •Testimonj', Trusts, Congress, 18SS, pp. 'iS-'id. ' Testimony, Commonivealth of Pennsylvania vs. Pennsylvania Kailroad et a!., 18t9, p. 295. ■" Same, p. 212, 108 WHO PIPED AKD WHO DANCED of the " outsiders " — the " independents." " j^othing short of the ingenuity that is born of necessity and desperation " pro- duced that pipe line. It was well contrived and well manned, and had plenty of money. It was organized in 1878, with a capital of $1,000,000, which increased in a few years to $5,000,000. It built a pipe from the oil regions to Williams- port — 105 miles — on the Philadelphia and Heading Kailroad, whence the oil was carried in cars by that company and over the Jersey Central to Philadelphia and New York. Unlimited capital and strategy did all that could be done against the Tidewater. At one place, to head it oflf, a strip of land barring its progress was bought entirely across a valley. It escaped by climbing tJie hills. At another point it had to cross under a railroad. The railroad officers forbade. Hid- ing around, almost in despair, its engineer saw a culvert where there was no watercourse. It was for a riglit of passage which a farmer, whose land was cut in two by the railroad, had re- served in perpetuity for driving his cattle in safety to pasture. It did not take long to make a bargain with the farmer for permission to lay the pipe there. The pipe line was finished and ready to move oil about the 1st of June, 1879. On June 5th a meeting was held at Sara- toga of representatives of the four trunk-line railroads and of members of the oil trust. Tiie meeting decided that the new competitor should be fought to the death. The rate on oil, which had been $1.15 a barrel, was reduced to 80, then to 30, to 20, to 15 cents by the railroads, to make the business unprofit- able enough to ruin this first attempt to pipe oil to the sea- board. Finally the roads carried a barrel, weighing 390 pounds, 400 miles for the combination for 10 cents or less.' The rep- resentative of the Tidewater offered to prove to Congress, in 1880, if it would order an investigation — which it would not — that '•■ the announced and ostensible object of the confer- ence at Saratoga was to destroy the credit of the Tidewater, and to enable the oil combination to buy up the new pipe line, and ' Xew York Assembly " Hepburn " Eeport, I87a, p. 45. WAR ON THE TIDEWATER 109 that a time was fixed by the combination within which it promised to secure the control of tlie pipe line — provided the trunk-lines would make the rates for carrying oil so low that all concerned in transportation would lose money." There can be no doubt," he continued, " that, taking tlie avowed and ostensible object of the Saratoga meeting as the true one, it constituted, on the part of the willing participants, a criminal conspiracy of the most dangerous character." One of the chief officials of the Pennsylvania Railroad testi- fied to the competition which his road had carried on with the Tidewater. " It certainly was fought," he said ; "the rates were considerably reduced." " Kates were put down to points so low that the railroad men would never tell what they were. I have no knowledge — I have no recollection — was all the president and general freight agent of the Pennsylvania Kail- road could be got to say, when before the Intei-state Com- merce Commission.^ "Not enough to pay for the wheel grease," said the general freight agent.* The oil trust also cut the prices of pipeage by its local lines from 20 cents to 5 cents a barrel, turning cheapness into the enemy of cheapness. But the Tidewater was strong enough to withstand even so formidable an assault as this. As its business was small, its losses were small ; but the railroads, making this war on it for the benefit of others, suffered heavily. The trunk-lines, it has been calculated, wilfully threw away profits equal to $10,000,000 a year for the sake of inflicting a loss of $100,000 on the pipe lines.' Enough revenue was lost to pay divi- dends of 2^ to 5 per cent, on the total capital of the roads. One effect that followed this reduction in rates was a cor- responding decline in the price of oil at New York, in which the cost of freight is a constant element. The Committee of ' Franklin B. Gowen, before House Committee of Commerce, Washington, Jan. 27, 1880. ^ Testimony, Titusville and Oil City Independents' case?, before Interstate Com- merce Commission, pp. 299-300. ' Same, pp. 521, 539. <■ Same, p. 534. 'Franklin B. Gowen, before House Committee of Commerce, Wasliington, Jan. 27, 1880. 110 WHO PIPED AND WIIO DANCED the New York Legislature found in the testimony it heard reason to believe that the members of the oil trust took advan- tage of their advance knowledge to sell at high prices, to those who did not know, all they would buy for future delivery. The "Hepburn" report of the New York Legislature of 1879 gives special prominence to the computations that $1,500,000 were the profits of this speculative deal." The customers of the Tidewater, the independent refiners in Philadelphia, were charged by the Pennsylvania Railroad on oil that came through the Tidewater 15 cents a barrel for one mile of liaulins:. The utmost the law allowed them was half a cent a mile, and they were carrying oil 500 miles to New York for the same charge of 15 cents a barrel, and less. Under such pressure these independent refineries, which the Tidewater had been built to supply, sold out one after another. The Tidewater was then in the position of a great transporting company, that had spent a large amount of money to bring a great product to its Philadelphia terminus, and found that refining establishments which had been beg- ging it to give them oil had become the cohorts of its op- ponent. To meet this the Tidewater built refineries of its own at Chester, and at Bayonne, New Jersey, on New York waters. When asked for a rate to another point, the Pennsylvania gave one that was three and four times as much as they would charge the oil trust, but added, " we cannot make a rate on the empty cars returning." That is, as it was interpreted, " we will carry the oil, but we will not permit the empty cars to come over the roads to get the oil. They must be taken on a wheelbarrow, or by canal, or by balloon." ' The war went on. Attempts were made to seduce the officials of the Tidewater. A stockholder, who had been too poor to pay for his stock, received a large sum from the oil combination and began a vexatious suit for a receivership.' A minority ' Report, p. 45. 'Franklin B. Gowen, before Pennsylvania House of Representatives Committee on Railroads, Feb. 13, 1883. s See ch. xiii. A PLUO IN THE PIPE 111 forced their way into tlie offices of the companj'^, and took violent possession of it by a "farcical, fraudulent, and void" election, as the court decided in annullinjr it. Its financial credit was attacked in the money market and by injunctions against its bonds. Affidavits were offered from members of the oil combina- tion denying that they had liad anything to do with these proceedings. In reference to these affidavits, the representa- tive of the Tidewater reminded tlie court that that combi- nation was a multifarious body. " One-half of them," he said, "do a thing, and the other lialf swear they know nothing about it. In pursuance of this Machiavelian policy, they liave eight or ten gentlemen to conduct negotiations, and eight or ten to say they do not know anything about them." Then, with no visible cause, the capacity of the pipe fell below the demands upon it. This insufficient capacity was pleaded in court as one of the reasons why the pipe should be taken out of the hands of its owners. One day the cause was discovered — a plug of wood. Some mysterious hand had been set to drive a square block of wood into the pipe so as to cut down its capacity to one-third. The representative of the Tidewater declared in court his belief that this plug had been placed by "people on the other side who have made affidavits in this case." A similar deed, but much worse, as it might have cost many lives, was done during the contest with To- ledo, nine years later.' The Tidewater was successful, but not successful enough. It owned 400 miles of pipe, including the 105 miles of the trunk-line, and had control of nearly 3,000,000 barrels of tankage. It did a great work for the people. " It was," the Philadelphia Press said, in 1883, " the child of war. It has been a barrier between the producers and the monopoly whicli would crush them if it dared." While these words of exulta- tion were being penned, a surrender was under negotiation. The Tidewater's managers were nearly worn out. These tac- ' See ch. xxvL 112 WHO PIPED AND WHO DANCED tics of corrupting their officers, slandering their credit, buying up their customers, stealing their elections, garroting them with lawsuits founded on falsehoods, shutting them oflE the railroads, and plugging up their pipe in the dark, were too much. They entered into a pool. The two companies in the summer of 1883 "recognized" each other, as the trunk lines do, and agreed to divide the business in proportions, which would net the Tidewater $500,000 a year. The an- nouncement that this pool had been forced on the Tidewater fell like a death-blow on the people of the oil regions. " Tlie Tidewater," the Philadelphia Press said, editorially, " will probably retain a nominal identity as a corporation, but its usefulness to the public and jts claim to popular confidence and encouragement were extinoruished the instant it consented to enter into alliance with the unscrupulous monopoly which resorts to that means of conciliating and bribing what it had failed to destroy." As was anticipated by the Press, the Tide- water retained its nominal identity, but that was all. Its sur- render was admitted by its principal organizer, Mr. Franklin B. Gowen. The officials of the Pennsylvania Kailroad have testified to it. "They made an arrangement of some kind, the conditions of which I never knew ; one swallowed the other or both swallowed the other, or something, and settled up tlieir difficulties,"' said the general freiglit agent. The pi-esident said : " The competition between these pipe lines ceased." ' The attorney of the Tidewater was asked if there were any negotiations which resulted in a compromise of the diffei-ences with the oil combination. "If by differences," he replied, "you mean competition in trade, I answer the question, yes. That resulted in a written contract. . . . The purpose of the contract was to settle the rivahy in business between tlie two companies, each company to take ' Testimony of General Freight Agent of Pennsylvania Railroad (Logan, Emery, and Weaver tw. Pennsylvania Railroad), ilcEean County Court of Common Pleas, IS89. - Testimony, Titusville and Oil City Independents' cases before the Interstate Commerce Commission, Deposition, pp. 531-34. COMPETITION OVERCOME AGAIN 113 a percentage of transportation and gathering, and each to do with the oil as it saw fit." ' The treasurer of the Tidewater, who liad been in its service since 1880, corroborated its attorney. A contract had been made between the two; the date of it was October 9, 1883. Copies of the contracts are in the author's possession. The Interstate Commerce Commission in 1892 judicially found the same fact. It says : " About December, 1883, the pipe lines, with the view of getting better rates, adjusted their differences, and the competition between them ceased. The pipe-line business appears then to have passed into the control of the N^ational Transit Company." " All but 6 per cent, of the National Transit Company is owned by the oil trust. It formed practically one-third the imposing bulk of the 870,- 000,000 of the trust of 1882.' If anything can be made cer- tain by human testimony this evidence proves that these pipe lines stopped competing in 1883. The witnesses are tlie men who negotiated the contract, and upon whose approval it de- pended. But when the president of the trust was asked under oath, in 1888, if there were any pipe lines to tide-water com- peting with it, he named, as "a competing company," "the Tidewater Pipe Line." " The Tidewater Company ? Does that compete with your company ?" " It does." " It is in opposition to it ?" " It is in opposition to it." * In the same spirit he denied, in 1883, that he had anything to do with the company which had represented the oil trust in this "swallowing or something" of tlie Tidewater. This, the National Transit Company, was the most important mem- ' Samuel Tan Svckel m. Acme Oil Company, Supreme Court of Ken- York, Buffalo, May, 18SS, before Judge Cliilds ; Deposition of David JIcKelvey. ' Titusville and Oil City Independents' cases ; Interstate Commerce Commission reports, vol. v., pp. 4, 5. "Trusts, New York Senate, 18S8, p. 572. ■•Same, pp. 889-99. 114 WHO PIPED AND WHO DAXCED ber of the trust. Under its cover, hy means like those de- scribed, from New York to "West Virginia and Ohio, almost all the pipes for gathering and distributing oil have been brought into one ownership. Millions yearly of the earnings of this company were pooled with all the others in the trust, and the president was receiving his share of them four times a year. He was the sole attorney' authorized to sign contracts for the trustees, who thus held all the combined companies in a common control. These trustees, of whom he was the chief, not only controlled but owned as their personal property more than half the stock of every company represented. But these facts were not then known to the public. It was not intended that they should be known, as the struggle to con- ceal them from the J^ew York Legislature five years later — in 1SS8— showed. " Have you any connection with the IN'ational Transit Com- pany ?" he was asked, after taking the oath. "I have not."" When the Tidewater passed under this alien control, Mr. Franklin B. Gowen severed all his connection with it. He did not hold himself for sale to any man who had money to pay fees. He stood at a height where the profession of law was immeasurably above prostitution in tlie temples of justice — the odious aspect in which the sacrifice of purity in the ancient temples of Aphrodite is reproduced in our courts. It would have been impossible for him to combine the functions of a great law reformer and procurer of judicial virtue for railroad corporation wreckers. He never forgot what some successful lawyers seem never to remember — that the lawyer is, as much as the judge, an officer of the court and of justice. While he lived he was proud to be recognized as the chief defender in the courts of the rights of those whom it was sought to crush in tliis industry, although he tlms allied himself with the poor and heavy laden. Ho could have used ' Trusts, New York Senate, 1SS8, p. C58. -Testimony, Corners, New Tork Senate, 1S33, p. 923. ANOTHER PETER THE HERMIT 115 his anti-monopoly eloquence as an advertisement of his value to monopoly; but he would not sell his soul to fill his stom- ach. His heart revolted against the wicked cruelty with which he saw the strong misuse the weak, and his penetrating vision saw clearly the ruin to which overgrown power and conscienceless greed were hurrying the liberties of his coun- try. In his speech before the Pennsylvania Legislature in 1883, advocating a law to prevent the use of railway power by railway oflScials to redistribute the property of the people among their favorites, he said, speaking of what had been done in the oil regions of Pennsylvania: " If such a state of facts as I now call your attention to had been permitted by any government in Europe or Asia for a six months, instead of the sixteen years it has existed in this Commonwealth, the crown and scei^tre of its ruler would have been ground into the dust, and yet the good, honest, patient, long-suffering peo- ple have submitted to it in this Commonwealth until the time has come that if we hold our peace the very stones will cry out. " I for one intend to submit to it no longer. You may say it is unwise for me to attack this wrong, but I have attacked it before and I will attack it again. If I could only throw off the other burdens that rest upon my shoulders, I would feel it to be my duty to preach resistance to this great wrong, as Peter the Hermit preached the crusade. I would go through this State from Lake Erie to the Delaware ; I would go into every part of this Commonwealth and endeavor, by the plain recital of the facts, to raise up such a feeling and such a power as would make itself heard and felt, and by the fair, open, honest, and proper enforcement of the law, right the wrong, and teach the guilty authors of this infamous tyranny " ' That truth remembered long ; When once theii- slumbering passions waked, Tlie peaceful are the strong.'" Mr. Gowen bravely fulfilled his pledge not to submit. His principal occupation became the championship in the courts and the Interstate Commerce Commission of those who were 116 WMO FIFED AND WHO DANCED oppressed by this crushing power. His incorruptible lance vras always in place, until the morning he was found dead in his room in Washington. The oil combination had, up to this time, sent all its oil east by rail as it had no pipe line, and its faithful fools, the railroads, tJierefore burned their fingers with joy to roast the Tidewater for so good a customer. But while the railroad officials were wasting their employers' property to destroy the combination's new competitor, its astute managers, seeing how good a thing pipe lines were, quietly built a system of their own to the seaboard. Tlie railroads had lielped them get hold of the pipe lines — had in repeated cases, as the Erie, the At- lantic and Great Western, the Pennsylvania, the Cleveland and Marietta did, allowed them to lay their pipes on the lands of the railroads — and were now to see the pipe lines used to replace the railroads in the transportation of oil. These oil men saw what the railroad men had not the wit to see — or else lacked the virtue to live iip to — that the pipe line is an oil railway. It requires no cars and no locomotives ; it moves oil without risk of fire or loss ; it is very much cheaper than the ordinary railway, for this freight moves itself after being lifted up by pumps. The pipe line was the sure com- petitor of the railway, fated to be either its servant or master, as the railroad chose to use it or lose it. The railways senti- mentally helped the trust to gather these rival transporta- tion lines into its hands ; then the trust, with the real genius of conquest, threw the railroads to one side. A system of trunk-line pipes was at once pushed vigorously to comple- tion in all directions. While the members of the oil trust were building these pipe lines to take away the oil business of the railroads, the officials of the latter were giving them by re- bates the money to do it with. At the expense of their own employei'5, tlie owners of the railroads, these freight agents and general managers presented to the monopoly, out of the freight earnings of the oil business, the money with which to build the pipe lines that would destroy that branch of the business of the roads. HEARTBEATS OF GOLD 117 It was the Tidewater tliat proved tlie feasibility of trunk pipe lines. The trunk pipe lines the combination has built were in imitation. Extraordinar3' pains have been taken to sophisticate public opinion with regard to all these matters — for the ignorance of the public is the real capital of monopoly — and with great success. The history we have transcribed from the public records is refined by one of the combination into the following illuminant : "About 1879 or 1880 it was discovered that railways were inadequate to the task of getting oil to the seaboard as rapidly as needed. Combined capital and energy were equal to the emergency. No need to detail how it was done. To-day there reaches," ' etc., etc. It must have been on some such authority that this, from one of our leading religious journals, was founded : " Only by such union" — of the refiners — " could pipe lines have been laid from the oil wells to the tide-water, reducing to the smallest amount the cost of transportation."" An account of the pipe-line system in the l^^ew York Sun, of December 14, 1887, describing the operations of the great pumps that force the oil through the pipes, says: "Every time the piston of the engine passes forward and back a barrel of oil is sent seaward. A barrel of oil is forced on its way every seven seconds of every hour of the twenty-four. Every pul- sation of the gigantic pumps that are throbbing ceaselessly day and night is known and numbered at headquarters in New York at the close of each day's business." This heart of a machine, beating at the headquarters in New York, and numbering its beats day and night, stands for thousands of hearts whose throbs of hope have been transmuted into this metallic substitute. This heart counts out a gold dollar for every drop of blood that used to run through the living breasts of the men who divined, projected, accomplished, and lost. > Comhinaiions, by S. C. T. Dodd, p. 28. ' Jfew York Lidependent, March 17, 1893. CHAPTER X CHEAPENING TKANSPOKTATION Through all the tangle of this piping and dancing one thread runs clear. The oil combination had up to this time been dependent on the railroads for transportation, but it emerged out of the fracas the principal transporter of oil, made so by the railroads. It now had two trunk pipe lines to the sea-coast — tlie one it had conquered and the one it had built — and the railroads had made it a present of both of them. The Tidewater — the first seaboard pipe line — had been built only because the Pennsylvania and other trunk lines had said "no" to every entreat}' and demand of the oil regions for a road to the sea. That line the railroads had conquered for the combination, as tiiey conquered for it the pipe lines of the Pennsylvania Railroad in 1877. The second seaboard pipe line was built by the combination with the railroads' money to take away the railroads' business, and best — or worst — of all, while the railroads were hard at work driving the Tide- water into its net. Such is the business genius of our "rail- road kings." This campaign closed, the duty of the hour for the oil ring was to get rates advanced hj rail as well as pipe. " Then they" — the pipe lines — " were anxious to get good paying rates," ' so that they could make a good thing out of the business of their own pipe and of the Tidewater which they had guaranteed $500,000 a year. The advent of the ' Testimony, Titusville and Oil City Independents' case?, Nos. 153, 154, 163, Interstate Commerce Commission ; Deposition of General Freight Agent Pennsyl- vania Railroad, pp. 531, 634. SELF-SACRIFICING SAILROADS 119 independent Tidewater had bronglit rates down. The resto- ration of exclusive control by its capture put rates up. But it was not enough for the oil combination to advance their own rates. It must induce the railroads to do the same. The railroads had furnished the means for the acquisition of both pipes, and they must now be got to drive business away from themselves to these competing oil railways. This would seem to be a delicate matter to achieve, but there was no trouble about it. " It is our pleasure to try to make oil cheap," ' the presi- dent of the oil trust told Congress, but it did not use its new facilities to take in hand at reduced cost the carriage of all oil, and give the industry the economic advantage of the pipe-line idea. Quite the contrary. It united with the rail- roads to increase the cost. Under this new blow the inde- pendent refiners and producers whom the Tidewater had been built to keep afloat grounded again. Then the railroads — the Pennsylvania especially — repented of what they had done to these their oldest customers, and sent ambassadors to them to renew the broken promises of 1872, that if they would re- build they should forever have equal rates and fair treatment. One of the highest officials of the Pennsylvania was sent to them to say : We recognize our error in permitting your re- fineries to be abandoned and the traffic destroyed. We wish to build up and maintain independent refining in the oil regions. We will give you every encouragement. We will insure j'ou equal rates, on which you can ship and live." These invitations and guarantees were repeated and pressed. They were renewed by the officials of the Erie also : " You need have no hesitation in building up 3'our business," said the officials of the Erie ; "you shall have living rates." ° The independents listened and believed. They rebuilt their works and prospered.' This meant the return of cheap- ness — cheapness of transportation over the railroads, to en- > Testimony, Trusts, Congress, 1888, p. 389. 'Testimony, Titusville and Oil City Independents' cases, p. 2V. 'Same, p. 28. 'Same, p. 27. 120 CREAPENINO TSANSPOSTATION able the refiners they had invited back to life to compete in the market — cheapness of light. Thereupon, incredible as it seems, the Pennsylvania and the other i-ailroads were influ- enced to declare war again upon the men who had reinvested their money and their life energy in response to these solici- tations. This new war began with a secret contract, in 1885, for an advance in rates against the independent refiners, who, in trustful reliance on the pledged faith of the railroads, had developed tlieir capacity to 2,000,000 barrels a year.' This campaign has lasted from 188.5 until the present writ- ing, 1891. In it the pipe lines, the oil combination, the Pennsylvania liailroad, and all the other great carriers be- tween the independents and their markets in Isew England, Europe, and Asia, have been mobilized into a fighting corps for the annihilation of the independents. This case illustrates nearly every phase of the story of our great monopoly: dear- ness instead of cheapness; willingness of the managers of transportation to den}-^ transportation to whole trades and sections; administration of great properties like the Penn- sylvania Railroad in direct opposition to the interests of the owners — to their great loss — for the benefit of favor- ites of the oflScials; great wealth thereby procured by de- struction, as if by physical force, of wealth of others, not at all by creation of new wealth to be added to the general store; impossibility of survival in modern business of men who are merely honest, hard-working, competent, even though they have skill, capital, and customers ; subjection of the majority of citizens and dollars to a small minority in num- bers and riches; subservience of rulers of the people to a faction ; last and most disheartening, the impotence of the special tribunal created to enforce the rights of the people on their highways. This secret contract of 1885 was thus described by the counsel of the refiners before the Interstate Commerce Com- mission : "It is a contract," he said, "so vicious and illeo-al ' Testimony, Titusville and Oil City Independents' cases, p. 17. IT MIGHT INCRIMINATE US 121 that the Pennsylvania Kailroad refuses to bring it into court for fear a disclosure of its terms might subject it to a crimi- nal prosecution." The courts have never been allowed to see it, but its pro- visions are known. Some of them ■were admitted before the Interstate Commerce Commission to be what was charged, and others were described on the trial by the counsel of the independents from personal knowledge. By this contract the railroad and the oil combination bound themselves to advance rates, and to keep them the same by pipe and rail. In re- turn for this pledge by the railroad not to compete it was guaranteed one-quarter — 26 per cent. — of the oil business to the seaboard. The Pennsylvania Railroad made no attempt to deny that it had made this contract. It admitted that it had an arrangement " substantially the same as stated." ' The combination was the largest shipper of oil, and yet it wanted freight rates advanced. It had pipe lines which could easily take to the seaboard all the oil that went thither, and yet it gave up a large part of the business to the Pennsylvania Railroad. The Pennsylvania Railroad knew that the pipe line was a competitor for the carriage of oil, and yet al- lowed it to dictate an arrangement by which the railroad got only one-quarter of the business, and signed away its rights to win a larger share if it could. The railroad had persuaded the independent refiners to set- tle along its line by solemnly promising them fair and living rates, and yet now put its corporate seal to an agreement to make those rates whatever their enemy wanted them to be. Such was its honor. As for its shrewdness, that had at last brouMit it to this humiliation in a business where it had once been chief, of confining itself to this insignificant quarter of a restricted trafiic instead of a competitive share of a traffic enlarged by freedom to the widest correspondence to the wants of the people. The mastery of the railroad men by 1 Answer of the Pennsylvania Railroad ; Testimony, Titusville and Oil City In- dependents' cases, p. 365. 122 CHEAFENINO TMANSPORTATION the oil people was thorougli. The latter did not agree to give the railroad one-quarter of their business. Not at all. All the traffic that came of itself to the railroad, or which its freight solicitors drummed up, must be put to the credit of the guarantee. All that was promised tiie railroad was that its total should amount to one-quarter of the whole traffic. All the rest the oil combination kept for itself. The contract went at once into vigorous operation. Freight rates to the seaboard, which had been 34 cents, and, as was proved before the Interstate Commerce Commission, were profitable, were advanced to 52 cents a barrel — an increase of one-half. The railroad and the pipe line made the raise in concert, as had been agreed, and when the rates were changed again it was to still higher figures. Why should the clique, which iiad its principal refineries at the seaboard — to which it had to transport large quantities of oil — scheme in this way to raise the rates of transportation ? Because it paid this ex- cessive rate on only a small part of its own shipments, and compelled its rivals to pay it on all of theirs. The indepen- dents iiad no pipe line of their own, but the combination sent its own oil east by its own pipe line, excepting only the quan- tity it needed to add to the shipments over the Pennsylvania to make good its guarantee to that railroad of one-quarter of the traffic. The cost of the pipe-line service to its owners is very small. When the manager of the pipe lines was before the Inter- state Commerce Commission the lawyers of the railroads, as zealous for the oil combination, though it was not a party in the case, as for their own clients, fought through eleven pages of argument against having him compelled to tell the cost of pumping oil through the pipe to the seaboard; and when the Commission finally said, "Go on," all tlie general man- ager of the pipe lines had to say was, "I do not believe that it is possible to know." ' Finally, he was cornered into an estimate that the cost ' Testimony, Titusville and Oil City Independents' cases, p. 250. AN msmB BARGAIN 123 of pumping was 6 or 7 cents a barrel. His questioner, who had been the organizer and manager of a great pipe line — the Tidewater — knew that oil had been pumped through for 4 cents a barrel, but he could not get his witness, who, no doubt, had doue it still cheaper, to admit anything of the kind. Tiie net effect of this pool with the railroad was that the oil combination succeeded in making its rivals pay 64 cents a barrel to reach the East and the seaboard, while it paid only 16' — except on the traffic guaranteed the Pennsylvania Kailroad — a difference against competition of 48 cents a bar- rel, a difference not for cheapness. " It only costs the pipe line 7 cents," the independents explained to the Interstate Commerce Commission, "and the published rate is 52. They are willing to pay 52 or even 70 cents on some of their product if they can make the other people pay 52 upon the whole of theirs." So much of the contract as we have referred to was ad- mitted. Why was it, then, the counsel for the railroad fought against showing it, even to the point of pleading that it might incriminate his client?' It was asserted, as of his personal knowledge, by the counsel of the independents that this was because another part of the bargain gave the proof that the rates which had been made under the agreement to put them up and keep them up were extortionate; that by a bargain within the bargain the oil combination carried oil for the railroad for the 280 miles for which they ran practically side by side, and for this charged it only 8 cents a barrel. The public, shipping either by the railroad or by the pipe line, had to pay 52 cents a barrel for 500 miles ; but bj' this ar- rano'ement between themselves the two carriers would do business at 8 cents a barrel for 280 miles, at whicli rate the charge to the public to the seaboard should have been not quite 15 cents instead of 52 cents. The statement was also made that the oil combination, in- ' Titusville and Oil City Independents' cases, Petition and Complaint. - Same, Testimony, p. 367. 124 CHEAPENING TRANSPORTATION stead of giving tlio railroads the business it has guaranteed them, makes its obligation good by turning over to them peri- odically a cheek for the profits they would liave had on liaul- iug that amount of trafiBc. As the guarantee was made as a consideration for the maintenance of high freight rates, such a payment by it would amount, in cold fact, to paying those in charge of the highways a large bribe to deny the use of them to the people. This declaration of the provisions of the bargain was made by the counsel for the refiners seeking relief from the Inter- state Commerce Commission. In his argument demanding the production of the document he said: "I have had it iu my hand and read everj' word of it, and know exactly what it contains." ' The sharpest legal struggle of the case was made on the de- mand that this paper be produced. The Commission decided that it was "wholly immaterial," although the chairman had previously said : " It seems to us that we cannot exclude this evidence." It was a document establishing interstate rates, and these are required by law to be published, and the Com- mission had always before this been liberal in compelling the production of papers which related to the making of rates.' The Commission had shortly before been threatened in this case by the counsel for the Pennsylvania Railroad with ex- tinction if it insisted upon evidence of the cost of piping oil which the oil combination refused to give. "It is possible that the powers of this Commission may be tested," ' bullied the counsel of the railroad. The members of the Commission laughed ostentatiously, but, for whatever reason, they gave the powerful corporations on trial no cause thereafter to " test their powers," which have slept while jus- tice tarried, and the victims of this "contract" were kept un- der its harrow for three long years more, where they still lie. The tax levied upon the consumers of oil b^' this agree- • Testimon}', TitusTille and Oil City Independents' cases, p. 372. = Same, pp. 380, 3S2. = Same, p. 256. COST DECLINES, FRIGES RISE 125 ment for high freiglits amounts to milUons a year. This agreement is at this writing still in force. There is reason to believe that similar arrangements exist with the other trnnk- lines. The result is the surprising fact that " oil rates arc very ranch higher than they were twelve years ago, and when there was no pipe-line competition!"' This is true also in the field of local pipeage— the transportation of the oil from the wells to refineries and railroads. Under the caption of " cheapening transportation" the counsel of the oil trust said, before the New York Legislature in 1888 : " In 1872 the pipe- line system was in its infancy. A number of local lines ex- isted. Their service was inefficient and expensive. There was no uniform rate. The united refiners undertook to unite and systemize this business. They purchased and consoli- dated the various little companies into what was long known as the United Pipe Line System. Tiie first effect of this com- bination was a reduction of price of all local trans poi-tation to a uniform rate of at first 30, and soon after 20 cents per barrel." ' "The united refiners" and "to unite and systemize" are smooth phrases, full of the unction of good - fellowship and political economy. When the "united refiners" took pos- session of the pipe lines which had been forced into bank- ruptcy or "co-operation," they did not reduce rates — they advanced them. "The uniform rate of 20 cents," for in- stance, is an advance of 300 per cent, on the rate of 6 cents made by the trust's pipe-line sj'stem during the war with the Tidewater, and over the similar rates made during the earlier pipe-line competition.' The nominal rate, Con- gress learned from one of the oil -country men, was 30 cents for that service, but by competition the actual rate was down to 5 or 10 cents. "They consolidated and placed it at 20 cents, and it lias remained at 20 cents, I think, since ' Xational Oil Company, Limited, to Interstate Commerce Commission, March SO, 1893. 2 Combinations: TVieir Uses and Abuses, by S. C. T. Dodd, p. 26. ' New York Assembly " Hepburn" Report, 1879, p. 36S8. 126 CHEAFENINO TRANSPORTATION the year 1876. . . . The whole process of transportation has been cheapened. Pipe that cost 45 cents a foot has in that time been got for 10 cents. The quality of the pipe was improved, so that there is not the leakage or the wastage. There are all those improvements and inventions that have cheapened it. "We pay the same now as we did fif- teen years ago. We have reduced the cost of our wells at least 60 per cent. They have reduced nothing." ' From other sources, once in a while, facts have come to light show- ing how much less than cheap the local charge of 20 cents a barrel is. For instance, it was shown before Congress that a line which, with its feeders, had fifty miles of pipe, and cost $70,000, made a clear profit in its first six months of $40,000, charging sometimes less than this rate of 20 cents a barrel.'' It is impossible to compute how much the defeat of legisla- tion to regulate charges, or to allow the construction of com- peting lines, has cost the people. The Burdick Bill alone, to regulate prices of pipeage and storage in Pennsylvania, it was calculated by conservative men, would have saved at least §4,000,000 a year. Tlie killing of it was in the interest of keeping up the high prices of the pipe lines, which finally rest in the price of oil. When the combination got possession of the pipe line to Buffalo, which others had built in spite of every obstacle it could interpose, it raised the rates of pipeage to 25 cents a barrel from 10 cents,' and as happened in Pennsylvania in 1S85, the railroads to Buffalo in 1882 raised their rates simultaneously with the pipe line. Pittsburg had the same experience. When its independent pipe line was " united and systemized" by being torn up and converted into "old iron," as the Vice-President of the Pennsylvania Raih-oad had told its projectors it would be, the rates of transportation for oil went up.' The same thing happened at Cleveland. At 1 Testimony, Trusts, Congress, 18SS, p. "il. = Same, p. 426. s g^^g^ p ^gg. * Tlie Railways and tlie Republic, by J. F. Hudson, p. 83. AN INERT SELF-INTEREST 127 the rate at which the Lake Shore road carries oil from Cleve- land to Cuicago — 357 miles for 38 cents a barrel — it should charge less than 15 cents for the 140 miles between Oil City and Cleveland ; but as late as 1888 it charged 25 cents. Why ? The effect of the railroad charge is that little oil comes by rail to Cleveland from the oil regions ; it goes by the pipe line of those whom the Lake Shore has been " protecting " ever since the South Improvement contract of 1872. There have been 3,000,000 barrels of this business yearly. The railroad offi- cials exercise their powers to drive traffic from the railroad to a competing line. Why ? We can see why the combination, ■which, by the possession of this pipe line, is a competitor of the Lake Shore, should desire such an arrangement; but it exists by the act of the Lake Shore Railroad. Why? Th» theories of self-interest would lead one to expect that the stockholders of the road would find out why." The pipe lines are the largest single item in the property of the oil combination. Here its control has been the most complete; and here the reduction of price has been least. This is a telltale fact, soon told and soon understood. 1 See pp. 69-70. CHAPTER XI SONG OF THE BAEREL Genius could take so unspeakable a thing as a shirt and sinff it into an immortal sons, but a barrel — and an oil-barrel, greasy and ill-smelling — even genius could do nothing with that. But the barrel plays a leading role in the drama of the great monopoly. Out of it have flown shapes of evil that have infected private fortunes, the prosperity of more than one industry, the fiduciary honor of great men, the faithful- ness of the Government to its citizens. Perhaps a part of what genius could do for the shirt — force a hearing for the wronged — may be done for this homely vessel of the strug- gling independent by the kindly solicitude of the people to learn every secret spring of the ruin of their brothers. The market — the barrel that went to market — the freight rate that stopped the barrel that went to market — the railway king who made the rate that stopped the barrel that went to market — the greater king who whispered behind to the rail- way king to make the rate that stopped the barrel that went to market — this is the house that Jack unbuilt. Such is the superiority of a simple business organization, where " evolution " has not carried the details of the industry out of sight of the owner, and where the master and man, buyer and seller, are in touch, that the independent refiners could overcome the tax imposed on them by this pooling of the pipe line and the railroads, and not only survive but pros- per moderatel}'. During the three years — from 1SS5 to 18S8 — following the first attack upon them under the contract just described, they state, in their appeal to the Interstate Com- merce Commission in 1888, they were " enabled by their ad- ANOTHER "NO" 129 vantages in the local markets to keep tip, maintain, and even increase their business." ' These " outsiders " shipped their oil largely in barrels because the trunk-lines had made it as nearly impossible as they could for them to sliip in tank-cars. They, like all in the trade, could not live without access to the European market. Out of every hundred barrels of vari- ous kinds of products from the distillation of petroleum, forty are of an illuminating oil not good enough to be burned in this country. It must be sold in Europe or not sold at all ; and a manufacturer who cannot get rid of 40 per cent, of his product must give up manufacturing. To destroy the barrel method of shipment would destroy those who could use no other; and to close their outlet to Europe would make it impossible for them to continue to manufacture for the home supply. The barrel was the only life-raft left to the sinking independent. They who had planned the secret pool of 1885 between the pipe line and the railroads, and the further advance of rates by both in 1888, now called upon the railroads to deliver a final stroke against the independents.' The railroads, when di- rected in previous years to say "no" to applications for transpor- tation, and "no" to those who wanted the right to put their own tank-cars on the road, had obeyed ; they obeyed again. A pretext for the suppression of the barrel was easily found. It was a poor one, but poor pretexts are better than none. When the future "trustees" of the "light of the world" were doing a small fraction of the business, they got the con- tract of 1872 from the railroads to "overcome" all their com- petitors, on the pretext of " increasing the trade." " When by this contract and those that followed it they had secured nine-tenths of the trade, they got the railroads to say "no" to the remaining one-tenth, on the pretext that they could not ship as much.' When the Interstate Commerce law declared 'TitQSville and Oil City Independents' 03363,^03. 153, 154, 163. Petition and Complaint, p. 4. ' Interstate Commerce Commission, " In the Matter of Eelative Tank and Barrel Rates on Oil," 1 888. Letter of G. B. Eoberts. = See ch. v. * See eh. viii. 9 130 SONG OF THE BARIiEL it to be a crime for railroads to forbid persons the road be- cause tliey conld not ship as much as others, the combination had the railroads shut out its rivals, on the pretext that they did not use tank-cars,' although tank-cars " are worse than powder." When regular tank-cars were ofEered by its compet- itors for shipment — as to tlie Pacific coast — the combination introduced an inferior tank-car, of which it claimed, without warrant, as the courts afterwards held, that it owned the patent, and so obtained the sole right of way across the continent, on the pretext that other shippers did not use this poor car.' The pretext now used against the refiners of Pennsylvania was the passing phrase, " He must pay freight on barrels," in a decision of the Interstate Commerce Commission con- cerning Southern trafiic. This decision had no relevancy to the oil business of the North. Six months went by after it was given with no intimation from any one that it related in any way to the situation in Pennsylvania, and to be so applied it had to be turned inside out and upside down. In the Rice case the Commission had decided that freight rates must be reduced on barrel shipments. This was, in the sharp language of the decision, to put an end to "the most unjust and in- jurious discrimination against barrel shippers in favor of tank shippers," a discrimination which the Commission has else- where said "inured mostly to the benefit of one powerful combination." In ordering this reduction it said : " Even then the shipper in barrels is at some disadvantage, for he must pay freight on barrels as well as on oil." By "must pay" tlie Commission meant "was paying." It was, as it afterwards protested, "rather a statement of a pre- vailing practice than a ruling." ' And the remark furthermore concerned the trade in the South and Sonthwest alone, where -special circumstances existed not found at the North. Six months after this decision the Pennsylvania and other ■' See below, and ch. xvii. ^ See ch. xxxiii. •^.Riee, Kobinson & Witherop case, Interstate Commerce Commission, 1890. DBCISIOS OF TEE COMMISSION 131 Northern roads made these words, "He must pay freiglit on tlie barrels," the occasion of an increase of rates, wliieh stopped the refineries of the independents. They were car- rying free the heavy tanks — " the most nndesirable business we do," in the langiiage of their freight agent. They had been carrying the barrels of the independents free for twenty years. Now, continuing to carry the tanjj-cars free, they levied a prohibitory transportation tax on the barrels. To cap it all, they declared, in announcing the new rule, that it had been forced upon them by the Interstate Commerce Commission. But the President of the Pennsylvania Rail- road is found admitting that it was the oil combination that dictated the move — " the seaboard refiners insisted." "Upon your decision" (in the Eice case) "being promulgated," he wrote the Interstate Commerce Commission, " the seaboard refiners insisted that we were bound to charge for packages," barrels, not tanks, " as well as for the oil." ' The seaboard refiners were tlie members of the oil trust ; the others at the seaboard had been wiped out j-ears before by the help of the railroads. Though tlie Pennsylvania Railroad was not a party to the case before the Commission, though it ,had not been called upon to change its practice, which was what it ouglit to be, it did now change it from right to wrong. The Commission had ordered that discrimination between the barrel and the tank should cease. The Pennsylvania, which had not, strange to say, been practising that forbidden kind of discrimination, immediately resorted to it, and, stranger still, gave as its reason the order of the Commission against it. It must have been a keen eye that could find in a " qualified and incidental remark," as the Interstate Commerce Commission styles it, in such a decision, a command to charge for the weight of the barrels and increase freight rates; but such an eye there was — an eye that will never sleep as long as Na- both's vineyard belongs to Naboth. ■ In the matter of Relative Tank and Barrel Rates on Oil. Letter of President Roberts, Interstate Commerce Commission reports, vol. ii., p. 365. 132 SONa OF THE BAMREL All the trnnk-line railroads to the East took part in the new regulation — September 3, 1888 — that freight must be paid thereafter on the weight of the barrels as well as on tLj oil itself, and at the same rate. This increased the cost of transportation to New York to 66 cents from 62 cents, and to other points proportionately. Freight rates on the oil of " the seaboard refiners " who shipped in tanks were left untouched. In the circulars announcing the change it was said to be done "in accordance with the directions of the In- terstate Commerce Commission." ' When the refiners whom this advance threatened with ruin wrote to expostulate, they got the same reply from all the railroad officials as from President Koberts of the Pennsylvania ILaih-oad : "The ad- vance in rates .... has been forced upon us by the Interstate Commerce Commission." ' The Commission immediately called the responsible official of the Pennsylvania Pailroad, which was the leader in this move, "to a personal interview," "expressed their surprise," and suggested the withdrawal of the circular and of the increased rates. This was in August.^ No attention was paid to this by the road. The Commission waited until October 10th, and then sent a formal communication to the President of tlie Pennsylvania Pailroad, which was followed by correspondence" and personal conferences with him. The Commission pointed out that the statement of the circular was " misleading," " not true," "decidedly objectionable"; tliat the Commission had made no decision with reference to the rates of the Pennsyl- vania Railroad or the other Eastern lines; that its decision, ap- plicable solely to the roads of the South or Southwest, had been that rates on barrels must be reduced, and that it was not right to use this as an excuse for increasing the rates on bar- rels. Finally, the Commission said that if it had made any ruling applicable to the Pennsylvania Railroad it would have ' Interstate Commerce Commission reports, vol. ii., p. 365. " Titusville and Oil City Independents' cases. E^liibits, pp. 6, 7, 10. 'Interstate Commerce Commission reports, vol. ii.,. p. 365. DECISION OF THE CORPORATION 133 been compelled to hold that its practice, of twenty years' standing, of carrying the barrels free, since it carried tanks free, was "just and proper," and that there was nothing to show that an advance in its rates was called for.' The Interstate Commerce Commission was the body spe- cially created by Congress to interpret the Interstate Com- merce Law. The Pennsylvania Railroad was one of the common carriers under the orders of the Commission, and its managers were subjects of jurisdiction, not judges. But its method of running the Supreme Court of Pennsylvania, as if it were one of its limited trains, was now applied with equal confidence to the Interstate Commerce Commission. It in- sisted that it was itself, not the Commission, which was the judge of what the latter meant by its own decisions. The road continued the rates against which the Commission pro- tested. The Commission demanded that the assertions that the new rule of charging for the barrels and the advance of rates was made "in accordance with the directions" of the Interstate Commerce Commission be withdrawn. The Penn- sylvania road responded with another circular, in which it changed the form but repeated tlie substance. " The action referred to was taken for the purpose of conforming the prac- tice of this company to tlie principles decided by the Inter- state Commerce Commission." Tlie Commission protested that it was not laying down any such " principles," but the corporation declared that tliat was what it "understood," and held to the advance made on that understanding." To the almost weeping expostulations of the Commission in interviews and letters, to show that it had said nothing which could justify the action of the roads, the officials made not the slightest concession. " I did not consider it in that way," said one of them.' " Tiiat was tlieir (the Commis- sion's) view of the ease, but it was not shared by ns," said the ' Interstate Commerce Commission reports, vol. ii., p. 865. ' Same. ' Testimony, Titusville and Oil City Independents' cases, p. 462. 134 SONO OF THE BARREL President of the Pennsylvania Eailroad. "It was considered best to continue the practice," he said.' " Why did you not rescind the order?" he was asked before the Interstate Commerce Commission. "We understood their ruling to be a ruling for the whole country'," he incorrigibly replied. The I'ailway president studiously withheld anj' assurance that he would obey if the Commission issued a direct com- mand, which it had not done, though it had the authority. "AVe would then take the subject up," he said. Cliange the order to comply witli the ruling of the Inter- state Commerce Commission the roads would not and did not.^ All the roads to the seaboard and J^ew England had made the order in concert, and together they maintained it. It was one hand, evidently, that moved them all, and though that hand moved them, for tlie benefit of a carrier rival of theirs — the pipe line of the trust — against their own customers, against their own employers, against the authority of the United States Government, all these railroad presidents and freight agents obeyed it with tlie docility of domestic animals. These ofBcials were the loyal subjects of a liigher power than that of the United States, higher even than that of their railway corporations. They serve the greatest sovereign of the modern world — the concentrated wealtli, in whose court the presidents of railways and republics, kings, parliaments, and congresses are but lords in waiting. Thanks to the superior enterprise of their greater need, tlie independents of Oil City and Titusville had been able to sur- vive the blows that had preceded, but this was too much. They had weathered the surrender in 1SS3 of the Tidewa- ter Pipe Line, which had promised them freedom forever. Even the "contract" which made the allied pipe lines and the railroads in 1S85 one, to tax them half as much again for transportation, had not broken them down. In spite of it ' Testimony, Titusville and Oil City Independents' cases, pp. 542, 543, » Same, p. 542. DIVISION OP FROPERTT 135 they had been able " to maintain and increase their business." ' But now they closed their works. The new attack had been shrewdly timed to spoil for them in that year — 1888 — the season of greatest activity in the export to Europe and Asia. They appealed to the Interstate Commerce Commission. " The greater proportion of our refineries are idle." ' " I have not a customer in the entire New England States. I have not had since the advance of last September." " How was it before the advance ?" " I had a number of customers." ° Labor, though, as always, the most silent, suffered the most. Three hundred coopers were thrown out of work in Titusville alone within a short time, and the loss of employment to the workmen in the refineries was still more serious. This was not because trade was bad. Exports were -never greater than in 1889. Government statistics reveal as in a mirror what was being done. The exports of refined petroleum increased 21 per cent, in 1889 over 1888. But Perth Amboy, from which the inde- pendents shipped for the most part, showed a decrease of over 18^ per cent. By the stroke of a freight agent's pen the business of these men was being taken from them, to be given to others. The general tide w^s rising, but their feet were sinking in a quicksand. The export business of Boston in oil was given to the "sea- board refiners " by the same stroke. Freights that had been $100 were now $174: to Boston,- and $188 to iSTew York. These rates were so high as to stop oil from going through. "Tiie Nova Scotia trade," it was testified, "goes to New York, and from there by water, whereas the}- used to buy in Boston. Boston brokers will ship oil from New York and get it to Nova Scotia cheaper than if it went from Boston, whereas when we had the export rate we could compete in that market." ' Two months later most of what remained of ' Titusville and Oil City Independents' cases. Petition and Complaint. ''Testimony, Titusville and Oil City Independents' cases, pp. 44, 110, 393, 396. ' Same, p. 401. ^ Same, p. 335. 136 SONG OP THE BARREL the business of the independents in New England was added to the gift of their foreign trade, which had ah-eady been made to the " seaboard refiners." By an order of October 25, 1888, the raih-oads made it known to these " pestilences," as the lawyers of the railroads called the independent refiners in court,' that they would not be allowed to send any more through shipments into New England. This was done, as in Ohio in 1879," without the notice required by law, though in the meantime a Federal law had been passed requiring notice." This order was the finishing touch in the task of using the freight tarifE to prevent freight shipment. It shut the inde- pendents—the hunted shippers — out of over 150 towns in New Hampshire, Vermont, Maine, Massachusetts, including Man- chester, Burlington, Portland, Salem, in which they had built up a good business, and it made it impossible to reach these places except by paying high local rates — from station to station — which were not required of their competitor, who shipped on through rates. The railroads would take the oil of the independents for shipment, but would not tell them what the rates would be. In this, as in all the moves of this game, we see the railroad managers of a score of different roads, at points thousands of miles apart, taking the same step at the same time, like a hundred electric clocks ticking all over a great city to the tune of the clock at headquarters that makes and breaks their circuit. The independents were saved by a Canadian railroad from the destruction which American railroads had planned for them. The Grand Trunk gave them a rate by which they could still do some business in the upper part of New Eng- land, though to do this they had to ship the oil into Canada and back into the United States. The effect of this abolition of through rates in "cheapening" oil was that the people of Vermont, for instance, had to pay 2 cents a gallon more than any other place in New England.* ' See p. 145. 2 See ch. xv. ' Testimony, Titusville and Oil City Independents' cases, pp. 283-84. * Same, p. 2S3. PABTITION OF NEW ENOLAND 137 While all access for others to New England was cut off, tiie " seaboard refiners," sending the oil in free tanks to the sea- board, transshipping it there into vessels by the facilities of " which they have a monopoly," ' easily made their own the business of their rivals in the 150 towns from which the latter were thus cut off. No one has been able to move all the rail- roads in this way, as one interlocking switch, to obey a law or accommodate the public. But it was done easily enough for this kind of work. Possession was got of the railway mana- gers at the initial points, as was done so successfully in an- other case,' and all the other railway managers, as far as Boston, followed in their trail. Eeproducing the tactics in Ohio in 1879, it was only against oil that this attack of the tariff was made. Other freight for export, of which there was a vast variety, continued to be carried to Boston at the same rate as before." All the freight agent of the initial road had to do with the oil on its way to Europe was to pass it along to the next line. "Whether, after leaving his road, it went by the way of Boston or that of New York made no difference to his road, and was in no way his affair. But it made a great deal of difference to those who wanted all the business of Europe and America for themselves, and we consequently find him serving them, and dis-serving his employer (the railroad), by charging 21 cents a barrel if the oil was going to Boston after leaving his line, but only 15^^,% cents if it was going to New York. When asked if he thought he was justified as a railroad man under the law in making the charges for what he did vary according to what was done by the business after it left his bands, he refused to answer. "You will not answer?" '•'Not at present."* All the connecting and following roads are on record as having protested against the measures in which they followed ' Titusville and Oil City Independents' cases, Interstate Commerce Commis- eiorf Reports, vol v., p. 415. * See chs. xv., xvi., xvii. ' Testimony, Titusville and Oil City Independents' cases, pp. 268-336. ■• Same, p. 476. 138 SONG OF THE BARBEL the lead of the initial lines.' The freight agent of the West Shore Eailroad declared that the prohibition of through ship- ments to the towns of Massachusetts, Vermont, New Hamp- shire, and Maine " occurred simply througli mistake ;" but the mistake, he acknowledged, had never been corrected.' This " mistake " and that of September, which preceded it, put an end to a large business, amounting in 1888 to 900,000 barrels. The men, whom the railroads began to massacre after having pledged tliem full protection, saved a fraction of their trade in New England, as we have seen, only by taking refuge ■with a foreign railroad. The railroads against their will, as they swore, lost business as well as honor, but the mistake was not corrected. It would tax the imagination of a Cervantes to dream out a more fantastic tangle of sense and nonsense in quixotic com- bat than that which these highwa3'nien spun out of the prin- ciples of "scientific railroading." All tliat highway control could do to destroy the barrel sliippers for the benefit of the tank shippers was done; and yet the barrel method is the safer and more profitable for the railroads.' The cars that carry oil in barrels can return loaded ; the railroads have to haul the tank-cars back empty and pay mileage on them.'' For a series of years on the Pennsylvania Kailroad the damage fi'ora carry- ing oil in barrels was less than half the damage from the carrying of oil in tanks.' The general freight agent of the Pennsylvania Eailroad Company tells tlie Interstate Com- merce Commission that the carriage of oil in tank-cars " is the most undesirable business we do." He described a smash-up at New Brunswick where there was a collision with a line of tank-cars. The oil got on fire ; it ran two squares, got into a sewer, overflowed the canal, which was then frozen over, and followed the ice a square or two beyond. Besides having to ' Testimonv, Titusville and Oil City Independents' cases, pp. 163, 461, S37. = Same, p. 267. 'Same, p. 29G. ■* Same, Testimony of Geiieial Freight Manager of the Lehigh Valley Eailroad, pp. 161-62. ' Same, Testimony of General Freight Agent of the Pennsylvania Railroad, pp. 523, 53Y. MORE DANGEROUS THAN GUNPOWDER 139 pay nearly five hundred thousand dollars damages for the de- struction done, the railroad lost its bridge, which cost two or three hundred thousand dollars. It lost more money than it could make carrying oil for ten years. "I regard it," he said, " as worse than powder to carry ; I would rather cari-y anything else than oil in tanks."' Barrel shipments being the best for the railroads, these princes of topsy-tnrvydom move heaven and earth to destroy them.' There was no end to the "mistakes" made by the railroads for the "self-renunciation" of their business, though this was in favor of those whose pipe line made them rivals. Tliey charged more for kerosene in barrels than for other articles of more value, contradicting their own rule of charging what the traffic will bear. They let the combination carry sixty- two gallons in every tank free on the theory of leakage in transportation. "The practice," said tlie Commission, "is so obvious and palpable a discrimination that no discussion of it is necessarj' ;" and they ordered it discontinued.' Though the railroads brought back the tanks free, for the return of the emptj"^ barrels they never forgot to charge. This charge was made so high that at one time it prohibited the return from all points.* " The monopoly uses a large number of barrels in New York Cit}'," the independents said to the Commission; "it is to its interest that empty second- hand barrels should not be returned to the inland refiner." When this was brought out the Pennsylvania and other rail- roads promised to make reparation, but had not done so years later when tlie case was still "hung up" in the Interstate Oomraeree Commission. It was not lack of capital or of diligence that made the in- ' Testimonj' of General Freight Agent of the Pennsylvania Railroad iu Nicolai and Bradv vs. Pennsylvania Railroad et al,, before Interstate Commerce Commis- sion, Jan. 2S, 18S8. 2 The new rates prohibited the traffic. Testimony, Titusville and Oil City Inde- pendents' cases, pp. 97, 110, 139, 141, 146-48, 383-84, 393, 396, 397, 400, 401, 402. ^Decision in Rice, Robinson, and Witherop ease, Interstate Commerce Commis- sion Reports, vol. iv., p. 131. ■'Testimony, Titusville and Oil City Independents' cases, p. 283. 140 SONG OF THE BARREL dependents use barrels instead of tanks; tanks were useless to them. All the oil terminal facilities of the railroads at the seaboard had been surrendered to the combination for its ex- clusive use.' Tliese were the only places where tank-cars could be unloaded into steamers. " There are no facilities to which we, as outside refiners, have access to load bulk oil into vessels," and none where these refiners could send oil in tank- cars to be barrelled for shipment abroad.' No matter how many tank-ears and tank-vessels the independents might have provided, they could not have got them together. Between the two were the docks in the unrelenting grip which held solely for its private use the shipping facilities of these public carriers. Not even oil in barrels could the independents get through these oil docks. Tlie Weehawken oil docks of the Erie road on New York harbor are the best in the world. The Erie Railroad has $920,760 invested in them, but only one shipper can use them either for tanks or barrels. The Western traffic manager of the Erie was asked : " Would you take a shipment there over the Erie road of independent oil consigned to the New York docks ?" " No, sir." ' The Pennsylvania Railroad refuses to haul tank-cars for the independents to an}' other point at New York than the terminals so controlled by the combination. It will not haul them to other docks of its own. It will not let oil be shipped over its line to the points at which it connects with other roads for other harbors, though it will take shipments of anything else than oil.' This amounts to a refusal to allow the independents to use tank-cars or tank -steamers. Prac- tically the same policy is pursued by all the main trunk-lines. These independents could get rid of their export oil only by selling to the combination. Through its other self— the company which controls the terminals — it has kept an agent • Ken- York Assembly "Hepburn " Report, 1879, p. 44. ' Testimony, Titusville and Oil City Independents' cases, p. 36. 5 Same, p. 270. ■" Same, p. 221. BOW TEMMINAL MONOPOLY PAYS 141 in the oil regions for years to buy for export this refined oil which its owners and makers conld not export themselves. This is the "immediate shipment" of 1878 in another phase.' "Ton have to sell to the Standard Oil Company in order to get your oil shipped in bulk from Communipaw?" " Yes, sir." " The independent cannot get his oil into a bulk vessel at Coramunipaw ?" "No, sir." ^ To meet these disclosures the Pennsylvania presented two affidavits. One was from its general freight agent that its tank-cars were offered freely to all ; but it did not deny, for it could not deny, any of these facts about terminals, which ex- plained why the flies did not walk into its parlor. The other affidavit was from the secretary of the corporation controlling the terminals for the oil combination, and it similarly de- clared that its accommodations were furnished " upon exactly the same terms to all." How long it had been doing so, or how long it would continue to do so, it did not state, as the independents pointed out to the Commission. If this were the truth instead of being, as the independents hinted, " evi- dently a situation that has been recently arranged for the purposes of tliis application" — to the Interstate Commerce Commission for further delay — why had none of the inde- pendents, dj-ing for want of export facilities, resorted to it? This was not explained, for it conld not be. The inde- pendents explained the situation to the Interstate Commerce Commission : " The inland refiner who intrusts his oil to a storage company at the seaboard with a view to export- ing, puts himself completely into the power of such con- cern. The exactions that may be unfairly imposed in indi- vidual cases for ' loss by leakage,' 'dumping and mixing for off- color or off- test,' 'cost of water white oil for mixing,' 'tares,' ' tares guarantee,' 'commissions on sales,' 'interest on ' See ch. tUL 5 Testimony, Titusville and Oil City Independents' cases, Mr. Confer, June 17, 1891, p. 12. 142 SONG OF THE BARREL goods until loaded and paid for,' 'incidental expenses,' and many other known matters of charge, may amount to a par- tial confiscation of the cargo." The corporation which manages this monopoly of the ter- minals at Communipaw is a mysterious concern. Who own its stock, and what its relations with the railroad are, the In- terstate Commerce Commission could not find out. Its pres- ident and treasurer were summoned to testif}^ but refused to attend. The manager of tiie oil combination's pipe lines stated that he knew of stock in the company that was owned by a member of the trust, though he afterwards qualified that he did not know it " positively." ' The charge that this company was controlled by the monopoly was specifically made before the Interstate Commerce Conmiission and was not denied, and the Commission found that the oil combina- tion " have a monopoly of those facilities to the exclusion of complainants."" It thus reported tiie same state of facts in 1S92 as the JS'ew York Legislature in 1879. The barrel was therefore the fountain of life for the inde- pendent. Without barrels he could not get his oil on board ship for export, and without exporting he could not live and refine for the home market. The oil combination ships in barrels also. According to the figures given in this ease by one of its "assistant managers" its shipments by barrel are very large. This testimony was introduced to make it appear cruel to insinuate that tiie difference between barrels and tanks was made by the railroads to favor it, since it as well as the independents used barrels. The Commission openl}' ex- pressed its dissatisfaction with this evidence, and dismissed the subject by the conclusive observation that the combina- tion gains more by the low tank-car rates than it loses by the high barrel rates. ^ For the independent, however, the dif- ference in rates was almost all loss, for he at that time shipped mostl}' in barrels. The high prices it made for oil and for freights at Titusville and Oil City did not hurt the combina- ' Testimony, Titusville and Oil City Independents' cases, pp. 23Y-38. ' Same, Report and Opinion of the Commission. = Same. COLLUSION WITH THE CAREIER 143 tion. It had only to close its refineries there and transfer their business for the time to its establishments elsewhere. This it did, keeping some of them idle for years.' Such' was the story told to the Interstate Commerce Com- mission, in many hundred pages of testimon}-, by the refiners of Oil City and Titusville, who appealed to it for the justice " without expense, without delay, and without litigation " promised the people when the Interstate Commerce Com- mission was created." The game, of which you have perhaps been able to get a dim idea from the printed page, the Com- missioners saw played before them like chess with living fig- ures. For years the principal subject of their ofiicial investi- gations had been the manoeuvres of the oil ring. They had been compelled by the law and the facts to condemn its rela- tion with the railroads in language of stinging severity, as every court has done before which it has been brought. Bet- ter than any other men in the country, except the men in the ring, the Commissioners knew what was being done. They comprehended perfectlj'^ who the "seaboard refiners" were whose demand that their competitors should be shut out of Europe and New England was better law with the Pennsyl- vania Railroad than the decisions of the Commission. They needed no enlightenment as to the purpose of the secret con- tract between the members of the oil trust and the Pennsyl- vania, nor any instruction that the "pool" between the pipe line and the railroad was as hostile to the public interest as any pool between common carriers. The chairman of the Commission had openly hinted that the relations of the oil trust and the railroads were collusive, and that the spring from which they flowed was a secret con- tract.' It was shown to the Commission that at the same time the railroads advanced their rates the oil combination bid up the price of the raw material of the Titusville and Oil ' Testimony, Titusville and Oil City Independents' cases, pp. 127-28. ' Report of Senate Select Committee, Interstate Gomraeice, 49th Congress, 1st Session, 1886, p. 214. = Testimony, Titusville and Oil City Independents' cases, p. 262. 144 SONG OP THE BAUBEL City refineries. This is called " advancing the premium." ' The raise of the freight rate added 14 cents a barrel to the cost of production, and the increased price of oil put on 12 cents more, either item large enough to embarrass competition. The Interstate Commerce Commission in its decision recog- nized the practical simultaneity of the three movements to the disadvantage of the independent refiners : (1) the bidding up of the price of crude oil against them; (2) the new rule of charging for the weight of the barrel ; and (3) the abrogation of the through rates to New England. These three things occurred in a period of about two months. This, the Commis- sion says, lends color to the charge that there was concert of action between the combination and the railroad. The Commissioners in their sittings had seen that the counsel for the railroads did not pretend to bring forward any evidence to prove that their attack on the barrel shippers was just or proper. Although " the seaboard refiners," for whose pecuniary profit these things had been done, were not on trial, their witnesses, agents, and attorneys were in constant attend- ance, and kept close watch of the testimony and arguments. The Commission had its attention called specifically to the fact that the defence of the railroads on trial was being di- rected by the same " seaboard refiners " wlio had " insisted " that the railroads should violate the law. The counsel for the Erie road was frank enough to admit that it was they who had prompted that carrier in its litigation before the Com- mission. When the Erie appeared before the Commission to give "further testimony," its representative could not tell at whose request its application therefor had been made, and said he had known nothing about the matter until the day be- fore. Three of the six witnesses then examined were from the offices of the oil trust, whose members had refused to come when summoned. The only subpoenas they obey are tliose issued from their own headquarters. The president of the oil combination's pipe lines — who is 1 Testimonv, Titusville and Oil City Independents' cases, pp. 20, 45, 75, 128-29 175-77. • ' ' - . TEE INTBliSTATE COMMERCE COMMISSION 145 also the president of the steamship line in which its members are interested — and the vice-president of the pipe lines, and the president and the treasurer of the company which holds for the trust the monopoJy of the terminal facilities, and the President of the New York, Lake Erie, and "Western Kailroad, and its vice-president, were all served with official notice to come and testify. But these gentlemen refused to appear. " It is for your honors," said the counsel for the refiners, sugges- tively, " to determine what obedience shall be paid to your subpoenas." ' But the Commission did nothing. The defendant corporations, and their lawyers, officers, and witnesses, made no pretence of treating the Interstate Com- merce Commission with anything m.ore than a physical re- spect. The representatives of the railroad companies practi- cally told the Commission that its decisions were subordinate to theirs, and that they knew better than it what its rulings meant. Witnesses refused to answer questions they found awkward, and the lawyers gave the court to understand that if it did what they did not like they would snufE it out. Tlie Commission heard one of the refiuei-s who was a petitioner before it assailed with coarse vituperation, described in open court as a " pestilence," " because he had dared to write more than once to the railroads for the reduction of rates which would save him from destruction, and which the Commission had, not once, but half a dozen times, said the railroads ought to give to all. The Commission had itself, outrunning the complainants, been the first to "pointedly disapprove" the attempt to de- stroy the barrel shippers, and to call upon the railroads to re- scind their action. This protest it had made repeatedly — first with the subalterns, then with the chief of the Pennsylvania Railroad, in personal interviews, lettere, and finally in an offi- cial pamphlet, which was an appeal to the public to judge be- tween it and the corporation. It had reiterated its protest in a formal decision rendered September 5, 1890, after delib- ' Testimony, Titusville and Oil City Independents' cases, pp. 304-5. 2 Same, p. 4SC. 10 146 SONO OF THE BAMEEL crating seven months on the evidence and arguments. In this "they recalled the fact, now almost ancient history, that" the change was "pointedly disapproved b}' the Commission" when first made, and with lamentations noted that, though al- most two years had passed, "the carriers have failed to com- ply with the suggestions there made. In charging for the weiffht of the barrels as well as the oil, the carriers that make use of both modes of transportation have disregarded the principles plainly and emphatically laid down by the Commis- sion in the cases cited, and have paid no attention to the sub- sequent official memorandum explanatory of the decisions in those cases, but have persisted in maintaining a discrimination against barrel shippers. An order requiring the discontinu- ance of the discrimination has therefore become necessary." ' An order has therefore become neccssar\'. The Commission then ordered one road concerned in this separate case to " cease and desist" within thirt}' days. Although several cases af- fecting a number of refiners and a number of roads had been heard and submitted together, as practically one in traffic, ter- ritory, circumstances, and the main question, it confined its decision to the case which involved only one road, and that a subordinate. There the Commission stopped ; and there it stuck for more than two j'ears, from September 5, 1890, to I^ovember li, 1892, refraining from a decision in the case of the principal offender, the Pennsylvania Railroad. The Pennsj'lvania Kailroad is the representative carrier in the oil traffic. It controls all the oil business that passes over its lines, no matter how far away it originates. The initial road which led the attack on the barrel shippers is subsidiary' to the Pennsylvania in the oil business, and the Pennsylvania controls its rates and regulations.' The Pennsylvania has been the head and front of the railroad attack on these men, and has been the open nullifier of the law and the Commission in this matter. It was the principal defendant on trial, and its case 'Interstate Commerce Commissiou Reports, vol. iv., p. 131. -Testimony, Titusville and Oil City Independents' cases, pp. ISS, 193, 446, 46G, 467. FACING THE GREAT RAILROAD 147 was identical witli that of the others, except that it was the most flagrant; but no order would the Commission issue against it for two years. Wendell Phillips says: " There is no power in one State to resist such a giant as the Pennsylvania road. "We have thirt3'-eight one-horse legislatures in this country; and we have a man like Tom Scott with three hundred and fifty millions in his hands, and if he walks through the States they have no power. Why, he need not move at all ; if he smokes, as Grant does, a puff of the waste smoke out of his mouth up- sets the legislatures." When the Commission had ordered a change of I'ates on barrels in the South, the Pennsylvania did the Commission the double disrespect of declaring that that order was binding upon itself against the protest of the Com- mission, and of using an order to reduce rates as an excuse for raising them. But now when the Commission, September 5, 1890, made a decision on the same point in a cse arising in the territory and traffic in which the Pennsylvania was the chief carrier^ a case, too, of a bunch of cases in which the Pennsylvania was a defendant — that road ignored it. The Commission, in the Kice, Robinson and Witherop case, in 1890, promulgated the very rule which the Pennsylvania Railroad established, which it had been following for twenty j-ears, and which its officers before the Commission swore was the correct one, but the Penns^dvania refused now to accept and follow it. Tlie road which was now ordered to go back to the correct practice, and which had perforce done so, was the initial road. The Pennsylvania had followed its initiative in adopting a "false" and "misleading" and "unwarranted" practice, but would not follow it in changing to the good. The attitude in which the Penns3'lvania road and the Com- mission were thus placed towards eacli other was this : Shall the Pennsylvania Railroad be allowed to make a charge which the Commission volunteered to rebuke it for making, and which it had decided, in the parallel case of another road in the same situation, was altogether unwarranted and must cease? They stood thus facing each other more than two years. There was apparently no excuse for delay the 148 SONG OF THE BARREL Commission would not accept. At one time it granted post- ponement on the plea of a lawyer that his father was sick. More than the lawyer's father were sick ; a whole community of business men were sick ; the entire country was sick, its industry, law, politics, morals — all. The administration of justice was sick. If the facts had been uncertain, or the law undetermined, the course of justice would still have seemed cruelly sluggish ; but here was a matter in which the facts and the law in question had been settled, and by the Commission itself, over and over again. Tlie only thing remaining was that the Pennsylvania Railroad, as well as the road which was its next neighbor, must obey the law. The railroad against which the Interstate Commerce Commission decided in 1890 on this point joined the Pennsylvania at Irvineton and Corry. The Commission put the law into force on one side of those points, but for two years gave the Pennsylvania Kailroad and others "rehearings" and other means of delay, and did not open its lips to say that the same law must reign on the other. The conduct of this corporation meant that it in- tended to respect neither the Interstate Commerce Commis- sion nor the Interstate Commerce law ; that it recognized the will of cliqued wealth as the supreme law ; that the protesta- tions of loj'alty to the la%v and the Commission with which it accompanied its defiance of both were not offered as a dis- guise of respect, but were chosen as a method which would most embarrass the people's tribunal in upholding itself and the rights of the citizens. All that was needed by those who had contrived and were continuing the wrong was time — they had everything else. Time they got, and plenty of it. July 15, 1891, the refiners said to the Commission: "Two and oue-half j'ears have elapsed since these complaints were filed, and the end is not j'et. We earnest!}' hoped that we had succeeded in convincing this Commission that this re- spondent was inflicting on complainants a great and unneces- sary wrong, which merited the most speedy remedy and re- dress possible. If we have failed in this we are unable to ascribe the failure to a lack of evidence or promptness in pre- JUSTICE WITBOUT DELAY 149 sen ting it. It was not thought possible that all this great length of time would be required to reach a conclusion in these matters, under all these circumstances, especially after the decision in the Kice, Robinson, and Witherop case (Sep- tember 5, 1890). The enemies of the complainants could scarcely have found or wished for any more effectual way of injuring complainants than by a long delay of their cause. Further delay simply means further injury to complainants." The two years and a half have gone on to more than five years. A decision has been made, but the end is not yet. The delay prevented the injured men from going to any other tribunal with their complaint. They have succeeded in keep- ing alive, though barely alive, because the price of their raw material has declined a little, and given them a margin to cling to. This delay has denied them justice in the special tribunal they were invited to attend, and has also denied them the relief they could have got from other courts. The Commission heard all this urged by eloquent coun- sel. It heard the men who were being crushed tell how their refineries were being closed, their customers lost, their business wrecked, their labor idle, while the trade itself was growing larger than ever. It saw the statistics which proved it. But no practical relief have the independents of Oil City and Titusville been able to get from it. They have lost the busi- ness, lost the hopes of five years, lost the growth they would have made, lost live j'ears of life. Tliis delay of justice is awful, but it is not the end, for the decision, though it came at last in November, 1892, has brouo-ht no help. It required the roads to either carry the barrels free or furnish tank-cars to all shippers, and for the past ordered a refund of the freight charged on barrels to shippers who had been denied the use of tank-cars, ilore than five months after it was rendered the independents, in an appeal (April 20, 1893) to the Interstate Commerce Commis- sion called its attention to the fact that " none of the railroads in any one of the cases has as j'et seen fit to obey any of its orders save such and to such extent as they found them ad- 150 SOl^a OF THE BAMREL vantageous to themselves, although the time for doing so has expired." More appalling still, it appeared, in an application made in March, 1893, by the Pennsylvania Railroad for a re- opening of the case, that these years of litigation were but preliminary to further litigation. The counsel of the railroad, in the spirit in which it had previously warned the Com- mission that its powers "may be tested," now informed it that the road, if the application for further delay were not granted, would "await proceedings in the Circuit Court for enforcement of what it believed to be an erroneous order." And in another passage it referred to tlie proceedings before the Commission as being simply proceedings "in advance of any final determination of the ease on its merits." Four years and a half had been consumed when, as the indepen- dents pleaded to the Commission, "it might reasonably have been expected that as many months would have sufficed," and yet these are onlj' preliminary to "the final determination of the case on its merits." " The delay sufEered has been despairing — killing," was the agonized cry of the independents in their plea to the Inter- state Commerce Commission not to grant this new delay. " "We pray that no more be permitted." But in Xovember, 1S93, more delay was permitted by granting another applica- tion of the Pennsylvania Railroad for "rehearing." This was limited to thirty days, but these have run into months, and "the end is not yet." Five years have now passed in this will-o'-the-wisp pursuit of justice " without delay." And another "outsider," who has been a suppliant since March, 18S9,' before the Interstate Commerce Commission for the same relief — the free carriage of barrels where tanks are carried free — is still a suppliant in vain. The Commission consumed three years in hearings and rehearings, only to report itself unable to decide this and other important points raised by him. It was "a most perplexing inquiry," " we are not prepared to hold," " we desire to be made ac- quainted with the present situation," and "the results ex- ' See clis. xvi. and svii. " UNLAWFUL— BUT" 151 liibited by recent experience." "No sncli intimation is in- tended," said the Commission, as that it is right for the roads to charge for barrels when they carried tanks free— not at all. " "We simply refrain " from stopping the wrong, and " reserve further opinion for fuller information and more satisfactory inquiry." Perhaps, however, by "voluntary action" ' the rail- roads which had contrived this wrong would be good enough to stop it, though the Commission was not good enough to order them to do so! The Commission held that the rates were " unlawful ; but, for want of sufficient data, we do not undertake to point out the particular modifications and re- ductions which would satisfy the demands of justice." " " We are not now prepared to determine," " we feel unable to pre- scribe," "is not now decided," "reopened for further evidence and argument," are the phrases with which the Commission glided away from the settlement of other vital points as to which its intervention had been invoked for more than three years. Even when it directed the railroads to reduce their charge it added " to what extent the Commission does not now determine, and the cases will be held open for such further," etc. And there liis case hangs even unto this day, for since this "not-now-decided" decision the "outsider" has never re- newed his appeals to the Interstate Commerce Commission concerning these cases or others,^ but, hopeless of redress, has let them go by default. The secret contract stands, but the barrel men survive, barely, despite monopoly, by changing to tank-cars, and get- ting a pipe-line and some terminals. They create seaboard facilities and persuade the Jersey Central to haul their tanks. To meet this road they lay the pipe now to be described, and, to escape railroads altogether, will build to New York, if not ruined meanwhile. ■ Rice cases, Xos. 184, 185, 194. Interstate Commerce Commission Reports, vol. v., p. 193. * Same. ' George Rice vs. Tlie St. Louis Soutlnvestern Railn-ar Go. et al., and same vs. Baltimore and Oliio Soiithwcsteni Railway Co. et cd. Interstate Commerce Com- mission Reports, vol. v., p. 660. CHAPTER XII UNFmiSHED MAECH TO THE SEA Between May and December, Sherman made liis march from Lookout Mountain to the sea, cutting the Confederacy in two. For thirty years the people of Pennsylvania have been trying to break a free way to the ocean through the AUeghanies and the oil combination, and in vain. For ten years the hope of independent outlet to the sea from the oil- fields of Pennsylvania lay prostrate under the blow of the surrender of the Tidewater. Twice the people have tried again, only each time to be headed ofE. The first of these two rallies collapsed in the shut-down of 1887 ; the second was stopped at the cannon's mouth by an armed force at Hancock, New Tork, in the year of peace, 1892. By 1887 the people of the oil regions had recovered from the shock of losing the independent Tidewater Pipe Line,' and began to make new plans for getting to the sea. By some means the committee to whom they had intrusted the management of the new enterprise was persuaded to go to ITew York to confer with the ofiicers of the oil combination, who had measures of conciliation to propose that would make it unnecessary to build the new pipe lines. This committee, and finally the constituency it represented, were made to believe that the cause of the woes of the oil country was simply and only that there was too much oil- — not that there were too many empty or half-filled lamps. They agreed to cut down their business one-half, and were lured away from the project of getting full prices on a full product. The outcome was ' See cbap. ix. "LJSSS FEB DAY'' 163 the " shut-down " of 1887. The producers were persuaded it would bring back oil to a dollar a barrel — to stay there ; but after a brief and unremunerative spurt in values, a re- action, lasting to the present, carried prices to a lower level than ever, and the producers found that the last state of those who let such spirits enter them is always worse than the first. Several times before this tlie oil producers had tried to imi- tate tlie policy of scarcity, which the most brilliant business successes are teaching to be the royal road to wealth. It is stated by the report of the General Council of the Petroleum Producers' Union ' that the producers had twice entered into arrangements with the oil combination to lessen the product and regulate the price of crude petroleum, and that in each case the arrangement had been violated by the latter when it seemed about to become profitable to the producer. Hence, when in- vited to confer for a third venture of this sort, the Council de- clined to do so. But in 1887 the invitation, extended for the fourth time, was a third time accepted. The producers suc- ceeded in the restriction, but they did not better their con- dition. These men gave the world the spectacle of the pro- ducers flirting with the solitary and supreme buyer of their product, in the belief that he would help them to raise their price against himself. The agreement which was made with the producers was shown before Congress.' The producers were bound for a year from Ifovember 1, 1887, " to produce at least 17,500 bar- rels of crude petroleum less per day," and to make it, if pos- sible, " 30,000 barrels less per day." In return for this the oil combination agreed to give the speculative profits on 6 000,000 barrels of oil — the profits on 5,000,000 for them, and on 1,000,000 for their laborers. This move of those who want petroleum cheap to make it dear is one of the equivo- cations of policy in which princes have always distinguished themselves. The need of the hour was to stop the building of the competing pipe line. That was accomplished by the 1 Ti-usts, Congress, 1888, p. 695. ' Same, p. 09. 154 UNFINISHED MAMCH TO THE SEA scheme of the sliut-down, wliich amused the producers, and, as subsequent prices proved, did not hurt the buyer of their oil ; quite the contrary. Drills and puaips at once ceased their operations through- out the oil regions. Working-men were thrown out of em- ployment, stores were closed, hundreds of families had to sub- sist on charity. One of the Broadway producers who made this bargain for the shut-down admitted to the committee of the 'New York Legislature that "the oil-producing interest was abnormally depressed," and " that there was great dis- tress." ' The agreement itself recites that the price of petro- leum had been during the preceding year " largely below the cost at which it was produced." The people of the oil country went to work with desperation to enforce the policy of oil famine. Committees were formed among the well-drillers in each district, " whose duty," the formal papers of organization stated, " shall be to keep a lookout for and endeavor to pre- vent the drilling of wells." " "We have no way of stopping those who want to drill wells," one of the officers of the organi- zation said, "only by good, reasonable talk." The Well-drill- ers' Union appointed and paid one of their members to reason with people who insisted upon digging wells. It is not neces- sary to question the good faith of the assurance their officials gave Congress that his duties did not require the use of nitro- glycerine. But, " unofficially," nitro-glycerine was freely used to enforce the shut-down. Men who failed to feel the influ- ence of the "good talk," and went on putting up machinery, and drilling wells, would find their derricks blown into kin- dling-wood. Keferring to one of these occurrences, a member of the Well-drillers' Union told Congress it was a case where no permission had been granted by the union to drill. •' Was the rig destroyed ?" he was asked. " The derrick was blowed up by some kind of compound." The quantity of the "compound" was enough to shake windows six miles distant. The derrick and the machinery were "cheapened" into junk. ' Testimony, Trusts, New York Senate, ISSS, p. 449. LOGIC OF EXPLOSION 155 " Did you ever know of a case of any man's derrick and apparatus being blown up in the oil region before the forma- tion of this association?" one of the shut-downers was asked. " I could not say that I do." ' The owner of the apparatus destroyed, it was stated by the press, had been repeatedly requested to join the shut-down, but had refused. There were several such occurrences, recall- ing the affairs at the Buffalo refinery in 1885." When the people in Pennsylvania saw apostles of the gospel of making oil cheap enter into a bargain with them to make it scarce, it is not surprising that they should have become bewildered to the point of thinking that the noise of nitro-glycerine was "good talk," and should have sunk into the depression, mone- tary and moral, that alone could make such haggard faces rise among an honest laborious people. "We have seen how the refiners who pass under the control of the trust are compelled to make monthly reports. The same perfeetness of discipline appears at once among the pro- ducers in this shut-down. Every one of them had to make monthly reports of how much oil he had taken out of the earth. If the mobilization of industry goes on at tlie rate of recent years, it will not be long — not later, perhaps, than the end of the nineteenth century — before all producers, and all makers, will be sending monthly reports to Ifew York of grain, cattle, iron, wool, lumber, leather, and the manufactures of them to trustees, whose " pleasure it is to try to make them " — the men as well as the commodities — " cheap." The super- vision by means of these monthly reports was so close that over-production, however minute, was immediately known. If the owner of a well over-produced only the one-hundredth of a barrel, he got a notice to go slower.' To the producers engaged in it the result of the shut-down was that when their representatives at the end of it called on the oil combination in New York for the profits on the 5,000,000 barrels of oil set apart for them, as agreed, they ' Testimony, Trusts, Congress, 1S88, pp. 7, 19, 27, 28. ' See ch. xviii. ^Testimony, Trusts, Congress, 1888, p. 64. 156 UNFINISHED MA.RCH TO THE SEA were given a check for a sum between $200,000 and 8250,000." This was divided among those who had co-operated — nearly one thousand — in proportion to their share in tlie good work of making the supply of the light of the people so much " less per day." The drama of industry has not many scenes more striking than this of these men — the principal producers of the oil country, which had yielded in the thirty years up to this time more than 300,000,000 barrels of oil — going to the great syndicate in New York to buy the privilege of restrict- ing the production of their own wells, thankfully accepting the scanty profits on a speculative deal in the oil exchange of 5,000,000 barrels, receiving with emotions of enthusiasm a check for a couple of hundred thousand dollars for a year's "co-operation" from the men who had made out of their prod- uct hundreds of millions. The shut-down was a great disappointment in prices. The average price of petroleum at the wells for October, the month before the shut-down, was 70^ cents a barrel. The highest monthly price reached during the restriction was 93|-, in March, 1S88. The average for October, 1888, the last month of the year originally agreed upon, was 90^. By a subsequent understanding the restriction was continued until July, 1889. The price then was 95^. At no time during the shut-down was the coveted dollar mark maintained, and it was barely touched in March, 1888, after which there was a sharp decline to Tl-f in June, with savage losses to " the lambs." High prices did not come until the accumulation of 6,000,000 barrels set aside "for the use" of the producers had been sold out. After that there were in the winter following — 1889-90 — a few months in which the price rose, as to 81-12^ in November, 1889, but it sank the year following to 60f in December, 1890, and it continued to go down until crude oil reached 50 cents in October, 1892, the lowest point known since there was an oil market.^ 1 Xew York Tribune, June 29, 1889. - United States Department of the Interior. " Petroleum," by Josepli D. Weeks, p. SOO. Annual Oil Supplement to Oil City Derrick, 1893 and 1894. PROFITS OF SCARCITY 157 The men with whom the producers made their bargain, shrewder than they, and versed in the dynamics of the mar- kets, knew that the effect of setting apart 6,000,000 barrels of oil would be ultimately depressive to prices, not stimulating. Not knowing when or at what price this vast amount would be unloaded, buyers, both for use and for speculation, would be made timid, and prices would be held in check. The shut- down produced a great gambling mania. Untold millions were lost by men in the oil country, who gambled on the ex- changes to make the profits of the expected advance. Local panics, bank failures, ruin in all its shapes, were the escort of shame and loss which marched witli the shut-down. Curiously enough, it was those who speculated for the rise who were the losers. There was against them an element which knew better than they what prices were going to be, for it made them. It is this ability of insiders to bet on a certainty which has been the destruction of the oil exchanges. From Pitts- burg to New York they are now practically all dead. The amount of the reduction effected by the sliut-down, in- dependent of a natural decline which had set in some months before, has been estimated at 11,000,000 to 15,000,000 barrels. The production ran down from 25,798,000 barrels in 1886 to 21,478,883 in 1887, and 16,488,688 in 1888. In 1889 it was up to 21,487,435 again, and in 1890, 29,130,910. The price of light advanced. When the negotiations were in progress the producers were told that if the flow of oil glut- ting' the market could be stopped the price of refined could be advanced, and that for every eighth of a cent a gallon advance in it the producers could expect an advance of 4 cents a barrel on their crude oil. Eefined advanced during the shut-down to a price to correspond to which the crude should have risen to 96 cents a 'barrel. Instead, its price fell to 78 cents. The committee went to New York "to pro- test." Tlieir New York ally said there was no change in the markets of the world. That they could get the price for the refined, but they did not jiropose to hold up the price of the crude. " If we could not do that, they could not help it." 158 (TNFINISUED MARCH TO TEE SEX " He liad refined to sell, and crude to buy ?" " Yes, sir." ' This shut-down, the New York TribuTie said, was " one of the most interesting economical experiments made in recent years." It was, as the New York World said, " one of the largest restrictive movements ever attempted in commerce." The president of the trust, when examined on February 27, 18SS, by the New York Legislature, as to the agreement for the shut-down, declared positively that nothing of the kind had been done. " There has been no such agreement ?" he was asked. " Oh no, sir ! . . . Oil has run freely all the time." "And no attempt to do that?" "No, sir."" He afterwards recalled these denials, and excused himself on the ground that as he had been in Europe when the ar- rangement was made he had known of it only " incidentally." ° A " shut-down " on facts is as necessary to the success of the schemes for scarcity as a shut-down in oil. There are too many facts, as well as too much oil. " By advancing the price of the crude material you neces- sarily advance the pi-ice of the refined ?" another of the com- bination was asked. •• les, sir.'' The average price of refined at New York for export was 6.75 cents a gallon in 1887. This rose to 7.50 in 1888, the highest average price for any year between 18S5 and 1893. ' The efEect of the restriction — " one of the most extensive ever attempted in commerce" — was thus to make oil and light and all its other products scarcer and dearer. The pro- ducers really got no good. After the shut-down had been in progress five months, their committee issued an address con- gratulating them on the "gloi'ious results " achieved in the ' Testimony, Trusts, Congies?, 188S, p. 68. '-Testimony, Trusts, New York Senate, 1888, p. 387. = Same, p. 405. •> Same, p. 449. ' Annual Oil Supplement to Oil City Derrick, Jan. 2, 1893. CHAJRITT INSTEAD 0J<' WOBK 159 fidelity with which the pledge of restriction had been kept, but continued, " But prices are not yet remunerative." ' " We do not seem to have gotten it," one of the producers said to Congress, referring to the assistance they expected in an advance of the price to profitable figures." No lasting gain came to any one nnless to the monopoly, and it is possi- bly too soon to tell whether its gain will be " lasting." Part of the speculation was that the profits of 2,000,000 barrels, contributed equally by the combination and the pro- ducers, wei'e to be distributed among the working-men affected by the loss of employment. Men who had been earning $12 a day received a dollar a day from this fund, and lay idle.' A blistering picture of the condition of the region is to be seen in the testimony of one of the producers. " The payments that you have made, or that your assembly has made, have been to individuals ?" " Yes, sir." " State what the character of the occupation of the individ- uals thus relieved was in relation to the shut-in." " Pumpers and roustabout men who had families sick and impoverished. That was a source of relief to them, and we did not withhold it. It was in our community, and we thought we could well afford to allow them that." "For what did you pay them?" " For charity's sake." "Did you give them any occupation?" " "We had it not to give ; we gave them money instead." ^ This was the melancholy end of the great shut-down. But the people were not broken by their new failure. They did not lie long in the cul-de-sac into which they had been trapped. There is a magnificent reserve force of public spirit and love of liberty in the province of William Penn and the chosen State of Benjamin Franklin. The oil business has been a thirty years' war. The people have been whipped until one would suppose defeat had become part of their daily routine, I Trusts, Congress, 1888, p. 52. 'Same, p. 67. = Same, p. 29. * Same, p. 65. 160 VNFINISSED MARCH TO THE SEA but there have always been enough good men who did not know thej were beaten to begin fighting again early the next morning. It was so when the independents of Pennsylvania took the pool of the oil trust's pipe lines and the railroads bef oi-e the Intei-state Commerce Commission, only to reap the unex- pected demonstration that the tribunal created by Congress to prevent and punish discrimination was but one more theatre for litigation and delay.' Leaving their cause on the floor of the Interstate Commerce Commission, these men went forth for the seventy and seventh time to build a pipe line of their own, on which they are now busy. Their numbers, resources, and liopes are less, but their will and courage are undiminished. To-day, in northwestern and western Pennsylvania this small, determined body of men are going forward with a new cam- paign in their gallant struggle for the control of their own business. Their efforts have been, a friendly observer says, not too warmly, as heroic and noble and self-sacrificing as the uprising of a nation for indejiendeuce. Of all this very little has been known outside the oil re- gions, for the reason that the newspapers there are mostly owned or controlled by the oil combination," or fear its power. The last independent daily in northwestern Pennsyl- vania became neutral when the threat was made to place a rival in the field. With sympathy from but few of the home press, ridiculed by the " reptile " papers, and met at every turn by crushing opposition, and annoyances great and little from spies and condottieri, these m.en are, in 1594, working quietly and manfully to cut their way through to a free market and a right to live. Their new pijje line has been met with the same unrelenting, open, and covert warfare that made every previous march to the sea so weary. The railroads, the mem- bers of the oil combination, and every private interest these could influence have been united against them. As all through the history of the independent pipe lines, the officials of the railways have exhausted the possibilities of opposition. At ' See ell. xi. 2 Sec ch. xxiii. CANNON FOR COMPETITORS 161 Wilkesbarre, where a great net-work of tracks bad to be got under, all the roads united to send seven lawyers into court to fight for injunctions against the single-handed counsel for the producers. They pleaded again the technicalities which had been invoked afresh at every crossing, although always brushed away by the judges, as they were here again. Though they have allowed their right of way to be used without charge for pipe lines which were to compete with them, the railroads refused to allow the independents to make a cross- ing, even though they had the legal right to cross. Not con- tent with the champerty of collusive injunctions, they have resorted to physical force, and the pipe -layers of the inde- pendents have been confronted by hundreds of armed railroad employes. When they have dug trenches, the railroad men have filled them np as fast. Appeal to the courts has always given the right of way to the independents, but the tactics against them are renewed at every crossing because they cost them heart and money, and they have not tlie same unlimited supply of the latter as of the former. Their telegraph-poles have been cut down, lawyers and land-agents have been sent in advance of them to make leases of the farmers for a year or two of the land it was known they would want. For a few dollars earnest-money to bind the bargain, a great deal of land can be tied np in such ways. In some cases conditional offers would be made guaranteeing the owner five times as much as the independents would give, whatever that might be. Fur- ther to cripple them, a bill was introduced into the Pennsyl- vania Legislature and strongly pushed, repealing the law giv- ing pipe-line companies the right of eminent domain. The Erie, which has let the combination lay its pipe lines upon its right of way, and bore there for oil,' has been con- spicuous in its efforts to prevent the new pipe line from get- ting through. The line at last reached Hancock, New Tork ; there it had to pass nnder the Erie Railroad bridge in the bed of the i-iver. The last Saturday night in November, 1892, "Testimony, New York Assembly " Hepburn " Report, 1S79, p. 3482. 11 162 UNFINISHED MARCH TO THE SEA the quiet of Hancock was disturbed by the arrival of one hun- dred armed men, railroad employes, by special train. They unlimbered a cannon, established a day and night patrol, built a beacon to be fired as an appeal for reinforcements, put up barracks, and left twenty men to go into winter quarters. Dyn- amite was part of their armament, and they were equipped with grappling-irons, cant-hooks, and other tools to pull the pipe up if laid. Cannon are a part of the regular equipment of the combination, as they are used to perforate tanks in which the oil takes fire. To let the "independents" know what they were to expect the cannon was fired at ten o'clock at night, with a report that shook the people and the windows for miles about. These opponents of competition were will- ing and ready to kill though their rights were dubious, and there could be no pretence tliat full satisfaction could not be got through the courts if any wrong was done. For weeks Hancock remained in a state of armed occupa- tion by a private military force. Keferring to this demonstra- tion with a private army at a moment of profound peace, the Buffalo Express said of those responsible for it : " They con- tinue to fight with their old weapons — incendiarism and riot." !No case has been come across in which the railroads made any opposition in the courts to the oil trust crossing under their tracks with its pipe line. More than once the railroads have allowed this rival carrier to lay its pipes side by side with their rails. " Now, is j'our pipe line to iMew York laid upon the right of way of any railroad ?" " It touches at times the Erie road, and crosses the Erie road." " Did you pay anything for that to them ?" "l Same, p. 1S2. WAGONS CHEAPER THAN RAILROADS 211 " Increasing rapidly. ... I haul it in wagons now forty miles south of Manito." " The rates against yon on that railroad are so high that you can for a distance of forty miles transport your oil by wagon and meet the competition better than you can by using their own road ?" " Infinitely better." ' ' Trusts, Congress, 1888, pp. 416-20. CHAPTER XVI A SPY at one end of an institution proves that there is a tyrant at the otlier. Modern liberty has put an end to the use of spies in its government only to see it reapjDear in its business. Eice throughout the South was put under a surveillance which could hardly have been done better by Yidocq. One of the employes of the oil clique, having disclosed before the Interstate Commerce Commission that he knew to a barrel just how much Kice had shipped down the river to Memphis, was asked wliere he got the information. He got it from the agents who " attend to our business." " What have they to do with looking after Mr. Eice's busi- ness ? . . . How do your agents tell the number of barrels he shipped in April, May, and June ?" " See it arrive at the depot." " How often do your agents go to the depot to make the examination ?" " They visit the depot once a day, not onl}- for that purpose, but to look after the shipment of our own oil." " Do tliey keep a record of Mr. Rice's shipments ?"' " Tliey send us word whenever they find that Mr. Rice has shipped a car-load of oil." " What do their statements show with respect to Mr. Rice's shipments besides that ?" " They show the number of barrels received at any point shipped by Mr. Rice, or by anybody else." "How often are these statements sent to tlie company?" " Sent in monthly, I think." THE SCREW IN TRANSPORTATION 213 " It is from a similar monthly report that you get the state- ment that in July, August, and September, Mr. Kico shipped 602 barrels of oil to Nashville, is it?" " Yes, sir." "Have you similar agents at all points of destination ?" "Yes, sir."' This has a familiar look. It is the espionage of the South Improvement Company contract, in operation sixteen years after it -was " buried." When the representative of the oil combination appears in public 'with tabulated statements ex- hibiting to a barrel the business done by its competitors for any month of any year, at any place, he tells us too plainly to be mistaken that the "partly-born," completely "buried" iniquity, sired by the " sympathetical co-operation" of the trustees and their railroad associates of easy virtue, is alive and kicking — kicking a breach in the very foundations of the republic. A letter has found the light which was sent by the Louis- ville man who was so " fortunate in competing," immediately after he heard that one of " his " Nashville customers had received a shipment from the Marietta independent. It was addressed to the general freight agent of the Louisville and Nashville Eailroad. It complained that this shipment, of which the writer knew the exact date, quantity, destination, and charges, "slipped through on the usual fifth-class rate." " Please turn another screw," the model merchant concluded. What it meant "to turn another screw" became quickly mani- fest. Not daring to give the true explanation, none of the people implicated have ever been able to make a plausible' explanation of the meaning of this letter. The railroad man to whom it was sent interpreted it when examined by Con- gress as meaning that he should equalize rates. But Congress asked him; "Is the commercial phrase for equalizing rates among rail- road people ' turn another screw' ?" 'Testimony, Rico cases, Interstate Commerce Commission, Nos. 51-60, 1887, pp. 442-43. 214 " TURN ANOTHER SCREW " He had to reply, helplessly, " I do not think it is." The sender before the same committee interpreted it as a request "to tighten np the machinery of their loose office." ' Kice found out what tlie letter meant. " My rates were raised on that road over 60 per cent, in five days." " Was it necessary to turn on more than one screw in that direction to put a stop to your business ?" " One was sufficient." ' The rates to the combination remained unchanged. For five years — to 1886 — they did not vary a mill. After the screw had been turned on, he who suggested it wrote to the offending merchants at Nashville, that if they persisted in bringing in this outside oil he would not only cut down tlie price of oil, but would enter into competition on all other articles sold in their gi-ocery. He italicized this sentence: ^'' And certainly this competition will not he limited to coal -oil or any one article, and will not he limited to any one year." " " Your co-operation or your life," says he. " Have you not frequently, as a shipper of oil, taken part in the competition with grocers and others in other business than oil, in order to force them to buy oil ?" " Almost invariably I did that always." ' " The expense and influence necessary for sustaining the market in this manner are altogether expended hy us, and not by the representatives of outside oil," he further wrote. "Influence," as a fact of supplj' and demand, an element of price-making, is not mentioned in any political economy. And yet the "influence" by which certain men have got tlie high- ways shut to other shippers has made a mark as plain as the mountains of the moon on our civilization. "If we allow any one to operate in this manner," he continued, " in any one of our localities, it simply starts off others. And whatever trouble or expense it has given us in the past to prevent it we have found it to be, and still believe it to be, the only policy to pursue." ' ' Trusts, Congress, ISSS, pp. 524-30. 2 Same, p. 620. = Same, pp. 534-36. ■• Same, p. 533. s Same, p. 536. WEm COMPETITION IS BLACK-MAIL 215 They " are threatening," his Nashville agent, after the screw ■was turned, wrote lA.ice, "to ruin us in our business." ' The head of the Louisville " bone-cutters," when a witness before Congress during the trust investigation, stigmatized the action of his Nashville victims as "black-mail." They were " black-mailers" because they had sold a competitor's oil, and refused to continue to sell his own unless it was made as cheajj or clieaper. Competition, when he practised it on othei-s, was "sympathetica! co-operation." Tried on liim, it was " black-mail." " That man wanted us to pay him more than we paid the other jobbers " — i. e., he wanted them to meet the prices of competitors "because be thouglit we had the market sustained, and he could black-mail us into it. I bluffed him in language, and language is cheap." ' The "language" that could produce an advance of freights of 50 per cent, in five days against a competitor was certainly "cheap" for the man whose rates remained unchanged, and who thereby absorbed his neighbor's vineyard. The inevi- table result followed at last. Rice fought out the fight at Nashville seven years, from 1880 to 1887 ; then, defeated, he had to shut up his agency there. That was " evacuation day " at Nashville. It was among his oldest agencies, he told Con- gress, " and it was shut out entirely last year on account of the discriminations. I cannot get in there." ' State inspection of oil and municipal ordinances about stor- age have been other "screws" that have been turned to get rid of competition. City councils passed ordinances forbid- ding oil in barrels to be stored, while allowing oil in tanks, which is very much more dangerous, as the records of oil fires and explosions show conclusively. His New Orleans agent wrote Kice concerning the manoeuvres of his pursuer : " He has been down here for some time, and has by his engi- neering, and in consequence of the city ordinances, cut me out of storage. As matters now stand, I would not be able to handle a single barrel of oil." * In Georgia the law was made ' Trusts, Congress, 1888, p. 729. = Same, p. 634. 3 Same, p. 730. ■• Same, p. 733. 216 "TUliN ANOTHER SCXEW" SO that the charge to the oil combination shipping in tank-cars was only half what it was to others who shipped in barrels. The State inspector's charge for oil in tanks was made 25 cents a barrel ; for oil in barrels it was 50 cents a barrel. But as if that was not advantage enough, the inspector inspected the tanks at about two-thirds of their actual capacity. If an inde- pendent refiner sent 100 barrels of oil into the State, he would have to pay S50 for inspection, while the oil combination sending in the same would pay but 25 cents a barrel, and that on only 66f barrels, or $16 in all. This difference is a large commercial profit of itself, and would alone enable the one who received it to sell without loss at a price that would cripple all others. In this State the chief inspector had the power to appoint inspectors for the towns. He would name them only for the larger places, where the combination had storage tanks. This prevented independent refiners from ship- ping directly to the smaller markets in barrels, as they could not be inspected there, and if not inspected could not be sold.' All these manoeuvres of inspection helped to force the people to buy of only one dealer, to take what he supplied, and pay what lie demanded. "Why should an official appointed by the people, paid by them to protect them, thus use all his powers against them ? Why ? " State whether you had not in your employ the State in- spector of oil and gave him a salary," the Louisville represent- ative of the combination was asked by Congress. " Yes, sir." ' Throughout the country the people of the States have been influenced to pass inspection laws to protect themselves, as they supposed, from bad oil, with its danger of explosion. But these inspection laws prove generally to be special legis- lation in disguise, operating directly to deprive the people of the benefit of that competition which would be a self-acting inspection. They are useful only as an additional illustration of the extent to which government is being used as an active ' Trusts, Congress, 188S, p. 735. s Same, p. 535. A CHEAP COST OF PKODVCTION 217 partner by great business interests. Meanwhile any effort of tlie people to use their own forces through governments to better their condition, as by the ownership of ninnicipal gas-works, street-railways, or national railroads and telegraphs, is sung to sleep with the lullaby about government best, government least. This second campaign had been a formidable affair — a worse was to follow ; but it did not overcome the independent of Marietta. With all these odds against him, he made his way. Expelled from one place and another, like Memphis and Ifash- ville, he found markets elsewhere. This was because the Southern people gave him market support along with their moral support. Co-operation of father and son and daughter made oil cheaper than the " sympathetical co-operation " op- posing them, with its high salaries, idle refineries, and dead- heads. Rice had to pay no dividends on " trust " stock capi- talized for fifteen times the value of the property. He did not, like every one of the trustees, demand for himself an in- come of millions a year from the consumer. He found mar- gin enough for survival, and even something more than sur- vival, between the cost of production and the market price. "In 1886 we were increasing our business very largely. Our rates were low enough so that we could compete in the gen- eral Southern market." ' Upon this thriee-won prosperity fell now blow after blow from the same hand which had struck so heavily twice before. From 1886 to the present moment Rice and his family have been kept busier defending their right to live in business than in doing the business itself. Their old enemy has come at them for the third time, with everj' means of destruction that could be devised, from highway exclusion to attacks upon pri- vate character, given currency by all the powerful means at his command. The game of 1886 was that of 1879, but with many improvements gained from experience and progress of desii-e. His rates were doubled, sometimes almost tripled; in some cases as much as 333 per cent. Rates to his adver- ' Trusts, Congress, 1S88, p. 578. 218 " TURN ANOTHER SCREW" sary were not raised at all. The raise was secret. Saspecting something wrong, he called on the railroad officer July 13th, and asked what rates were going to be. The latter replied that he " had not the list made out." But the next day he sent it in full to the combination. Rice could not get them until August 23d, six weeks later, and then not all of them. As in 1879 the new tariff was arranged at a conference with the favored shippers." This was the first gun of a concerted attack. Kice was soon under tire from all parts of the field. One road after another raised his rates until it seemed as if the entire Southern mar- ket wonld be closed to him. While this was in progress the new Interstate Commerce Law passed by Congress — in part through the efforts of Rice — to prevent just such misuse of the highways, went Into effect. But this did not halt the rail- way managers. A month after it was passed the Senate Com- mittee on Interstate Commerce was shown that discrimina- tion was still going on, as it is still. At points as far apart as Louisville, ]^ew Orleans, Atlanta, St. Louis, and San Francisco switches were spiked against Rice, and the main lines barri- caded of all the highways between the Ohio River, the At- lantic and Pacific oceans, and the Gulf of Mexico. In the face of the Interstate Commerce Act the roads raised his freights to points in Georgia, Alabama, Tennessee, Kentucky, Louisiana, and Mississippi in no case less than 29, and in some cases as high as 150, 168, and 212 per cent, more than was charged the oil combination. "Where the latter would pay SlOO freight, he, shipping the same amount to the same place, would sometimes pay $310 — if he got it taken at all." The general freight agent of one of the roads, when before the Interstate Commerce Commission, denied this. When confronted with written proof of it he could only say, " It is simply an error." " Rice shows that in some cases these discriminations made him pay four times as much freight, gallon for gallon, as the ' Trusts, Congress, 18S8, pp. 579-80. = Same, p. 584. 'Testimony, Rice cases, Interstate Commerce Commission, Xos. 61-60, p. 147. A WITNESS AND A DISCREPANCY 219 monopoly. The differences against him were so great that even the self-contained Interstate Commerce Commission has to call them " a vast discrepancy.'' ' The power that pursued him manoeuvred against him, as if it were one track, all the railroads from Pennsylvania to Florida, from Ohio to Lake Superior and the Pacific coast. " Through its repre- sentative the oil combination was called before the Interstate Commerce Commission to explain its relation to this ' vast discrepancy.' " " Your company pays full rates ?" " Pays the rates that I understand are the rates for every- body." " Pays what are known as open rates ?" " Open rates ; yes, sir." ° That the increase of rates in 1886, like that of 1879, was made by the railroads against Rice, under the direction of his trade enemy, is confirmed by the unwilling testimony of the latter's representative before Congi-ess. " I know I have been asked just informally by railroad men once or twice as to what answer they should make. They said, Here is a man — Rice, for instance — writing us that you are getting a lower rate." He was asked if he knew any reason, legal or moral, why the Louisville and Nashville Railroad should select his firm as the sole people in the United States. "No, sir," the witness replied ; but then added, recovering himself, '•' I think they did because we were at the front." ' Tlie railroads bring the people they prefer " to the front," and then, because they are " at the front," make them the " sole people." Rice did not sleep under this new assault. He went to the Attorney- General of Ohio, and had those of the i-ailroads which were Ohio corporations brought to judgment before the Supreme Court of Ohio, which revoked their action, and could, if it chose, have forfeited their charters. The Supreme Court found that these raih-oads had charged " discriminating ' Trusts, Congress, 1888, pp. 682-83. - Testimony, Rice cases, Interstate Commerce Commission, 1887, Nos. 51-60, p. 57. 3 Trusts, Congress, 1888, pp. 629-32. 220 "TURN ANOTHER SCREW" rates," " strikingly excessive," -whicli " tended to foster a mo- nopoly," "actnally excluded these competitors," "giving to the favored shippers absolute control." ' Rice went to Cincinnati, to Louisville, to St Louis, and Baltimore to see the officials of the railroads. He found that the roads to the South and West, which took his oil from the road which carried it out of Marietta, were willing to go back to the old rates if the connecting road would do so. But the general freight agent of that company would give him no satisfaction. He wrote, October 3d, to the president of the road over which he had done all his business for years. He got no answer. He wrote again October 11th, no answer ; October 20th, no answer ; No- vember 14th, no answer. Rice had been paying this road nearly $10,000 a year for freight, sending all his oil over it. The road had used its rate-making power to hand over four- fifths of his business to another, but he has never been able to get so much as a formal acknowledgment of the receipt of his letters to the head of the road, asking that his petitions for restoration of his rights on the highway be considered. A part only of the letters and telegrams whicli he sent during these years — to get rates, to have his cars moved, to rectify un- equal charges, to receive the same facilities and treatment others got — fill pages of close print in the Trust Report of the Congressional Committee of Manufactures of 1888. " Your time is a good deal occupied with correspondence, is it not ?" " I should say so. If the rates had been more regular, I would not have had so much correspondence. It takes about all my time to look after rates." ' Driven off his direct road to market, Rice set to liuntine other waj's. The Baltimore and Ohio, he found, was, though very roundabout, the only avenue left by which he could get his oils into Southern markets. He began to negotiate witli ' Supreme Court of Ohio : tlie State, ex rel., vs. The Cincinnati, New Oi-leans and Te.xas Pacific Railway Company. The State, ex rel., vs. The Cincinnati, Washing- ton and Baltimore Railway Company, 41 Ohio State Reports, p. 130. - Testimony, Rice cases, Nos. 61-60, p. 384. END OF THE SltEATHING - SPELL 221 it immediately, but it was not until several months later — the middle of November — that he succeeded in closing arrange- ments. To get to Chattanooga, Tennessee, over this route his oil had to travel 1186 miles as against 582 miles by the roads which had been closed to him, and yet the rate was lower over the more than double distance. Again, he could send a barrel of oil 1213 miles by the Baltimore and Ohio to Bir- mingham, Alabama, for §1.22, while the roads he had been using put his rate up to 82.26, although their line to Birming- ham was only 685 miles. All the arrangements had been concluded to the mutual satisfaction of Kice and the Baltimore and Ohio Railroad. After this thorough discussion of four months, in which every point had been examined, Rice sends forward his first ship- ment December 1st. He is not a little elated to have blazed his way out of the trackless swamp in which he had been left by the other roads. His satisfaction is short enough. In about a fortnight — on December 15th — the then general freight agent of the Baltimore and Ohio telegraphed him that he could not be allowed to ship any more. " "We will have to withdraw rates on oil to Southern points, as the various lines in interest" — the connections to which the Baltimore and Ohio delivered the oil for points beyond its own line, and which shared in the rates — " will not carry them out." This was stunning. It nullified the labor of months which had been spent in opening a way out of this blockade. It put the cup of ruin again to the lips of the family at Marietta, innocent of all offence but that of trying to make a living out of the industry of their choice, and asking no favors, only the right to travel the public highway on equal terms, and to stand in the open markets. The excuse given was heavy- laden with inaccuracy. Rice immediately found out by wire that the Piedmont Air Line, one of the most important of the connections, had not refused to carry at the agreed rate. Its traffic manager telegraphed the Baltimore and Ohio people to reconsider their action, and continue taking Rice's oil. "When asked first by Rice, and afterwards by Congress, to 222 " TURN ANOTHER SCREW " name the lines which refused, as he alleged, to carry out tlie rates he had agreed upon, the general freight agent of tlie Baltimore and Ohio could not give one. He escaped from Congress by promising to send its committee, " within a day or two," all the correspondence with these other companies. Once out of the committee-room, he never sent a scrap of paper to redeem his promise, and the whole matter was lost sight of by the committee.' Eice, badly shattered, still sought and managed to find a few long-way-aronnd routes. He presented to Congress in 1888 a table showing how he still managed to get to some of his markets. To Birmingham, Alabama — the direct route of 685 miles, as well as the Baltimore and Ohio, being closed to him — he shipped over seven different railroads forward and backward 1155 miles. The rates of all these roads added to- gether made only $2.10 a barrel instead of $2.66, to which the shorter line had raised its price, for the purpose, as this comparison shows, not of getting revenue, but of cutting it off. To get into Nashville he had to go around 805 miles over five different lines instead of 502 miles, as usual, and still had a rate of $1-28 instead of $1.60. From 1880, the moment he turned to the Southern field, after the destruction of his business in the West, everything that railroad men's ingenuity could do was done to prevent him from becoming a successful manufacturer who might increase the amount to be shipped, open new markets, and steady the trade by making it move by many minds of differ- ent views and reasons instead of by one. In order barely to live he was kept writing, telegraphing, travelling, protesting, begging, litigating, worrying, and agitating by press, prosecu- tions, private and public, and by State and national investiga- tion. The ingenuity of the railroad officials in chasing him down was wonderful. Nothing was too small if it would hurt. Sometimes the railroad made through rates so high that it was cheaper for him to ship his oil along by short ' Trusts, Congress, 1888, pp. 897, 89S, 615-17. MISSTATEMENTS AND REFUSALS OF MATES 223 Stages, paying the local rates from place to place until it readied its destination. In tins way he got a car from Cin- cinnati to Knoxville at the rate of 32 cents altogether, when, if it had been shipped at once all the way on the through rate, it would have cost 40 cents a hundred. The railroads have spent hundreds of thousands of dollars, Tised up armies of gifted counsel, and spoiled tons of white paper with ink to ai-gue out their right to charge more for short hauls than long hauls; but when some traffic manager wants to crush one of his employer's customers, no short-haul long-haul consistency stands in his way.' It was not enough to fix his rates at double what others paid. All kinds of mistakes were made about his shipments. Again and again these mistakes were re- peated ; nor were the}', the Interstate Commerce Commission shows, corrected when pointed out." One of the stock excuses made by railroad managers for giving preferential rates to their favorites is that they are the " largest shippers," and, consequently, " entitled to a wholesale i-ate." But when Rice was the largest shipper, as he was at New Orleans, they forgot to give him the benefit of this " principle." When Rice wrote, asking if a lower rate was not being made, the railroad agent replied : " Let me repeat that the rates fur- nished you are just as low as furnished anybody else." " This lacks accuracy," is the comment of the Interstate Commei-ce Commission. Wishing to know if the Louisville and Nashville would unite with other roads in making through rates to him, Rice asked the question of its freight agent. He replied : " I do not see that it is any of your business." " It was undoubt- edly his business," the Interstate Commerce Commission says, sharply ; " and his inquiry on the subject was not wanting either in civility or propriety." When Rice asked the same road for rates, the officials refused to give them to him, and persisted in their refusal.' Like Vanderbilt before the New I Trustg, Congress, 18S8, p. 622. - Same, pp. 586, 676. Testimony, Rice cases. Interstate Commerce Commission, Nos. 51-60, 18S7, pp. 391-92. ' Same, pp. 676-7'?. 224 " TURN ANOTRER SCREW " York Legislative Committee, they seemed to think excuses to shippers were a substitute for transportation, and evidently thought they had done more than their duty in answei-ing Rice's letters. But as the Commission dryly observes, their answers to Rice's letters did not relieve him of the injurious consequences. In attempting to explain these tilings to the Interstate Commerce Commission, the agent of the railroad said : "If I have not made myself clear, I — " " You have not," one of the Commission interrupted.' Tlie refusal to give Rice these rates was an "illegal refusal," the Commission decided ; " the obligation to give the rates . . . was plain and unquestionable." This general freight agent was summoned by Congress to tell whetlier or not lower rates had been made to the oil combination than to their competi- tors. He refused to produce the books and papers called for by the subpcena. He had been ordered by the vice-president of tiie road, he said, to refuse. He declined to answer the questions of the committee. Recalled, he finally admitted the truth : "We gave them lower rates in some instances."^ Rice took to the water whenever he could, as hunted ani- mals do. The Ohio, Mississippi, Tennessee, Missouri were public highways that had not been made private property, with general agents or presidents to say " No " when asked permission to travel over them. He began to ship by river. Tlie chairman of the Committee of Commerce rose in his seat in Congress to present favorably a bill to make it illegal to ship oil of less than 150 degrees fire-test on the passenger boats of inland waters. The reason ostentatiously given was public safety. But, as was at once pointed out in the press, the public safety required no such law. The test proposed was far above the requirement of safety. No State in its inspection laws stipulated for so high a test. Most of the States were satisfied with oil of 110 degrees fire-test ; a few, like Ohio, went as high as 120 degrees. All but a very small ' Rice cases, Nos. 51-60, ISST, p. 119. ' Trusts, Congress, 1880, p. 520. HIGHWAYS THAT ASM FREE 225 proportion of the oil sent to Europe was only 110 degrees iire-test. The steamboat men did not want the law, and were all against it. Tliere was no demand from the travelling pub- lic for such legislation. General Warner, member of Con- gress, said, in opposing the bill : " Petroleum which will stand a fire-test of 110 degrees is safer than baled cotton or baled hay, and as safe as whiskey or turpentine to be carried on steamers. What is the object, then ? There can be but one, and I may as well assert it here, although I make no imputa- tion whatever upon the Committee of Commerce, or any member of it. It will put the whole carrying trade of refined petroleum into the hands of the railroads and under the control of ... a monopoly which has the whole carrying trade in the oil business on railroads, and they will make it as impossible for refiners to exist along the lakes and the Ohio River as it is impossible for them now to exist on any of the railroads of the country." Why the trust, though it was the greatest ship- per, should seek to close up channels of cheapness like the waterways was plain enough. They were highways where privilege was impossible. With its competitors shut off the railroads by privilege, and off the rivers by law, it would be competition proof. The United States authorities, too, moved against Rice, re- sponsive to the same "pull" that made jumping- jacks for monopoly out of committees of commerce and railway kings. When the Mississippi River steamer U. P. Schench arrived at Vicksburg with 56 barrels of independent oil, the United States marshal came on board to serve a process summoning the officers and owners to answer to the charge of an alleged violation of law. Several steamboats were similarly "libelled." " We were threatened a great many times," the representa- tive of the steamboat company told Congress.' The steamboat men were put to great expense and without proper cause. When the cases came to trial they were completely cleared in every instance. But the prosecution had done its work ■Trusts, Congress, 1880, pp. 410-11. 15 226 "TURN ANOTMER SCREW" of harassing competition. The success of the campaign of 1879 in Ohio was now repeated over a wider field. The at- tack of 1886, " in a period of five months," Kice said before Congress, " shut up fourteen of my agencies out of twenty- four, and reduced the towns we had been selHng in from seventy-three to thirty-four." ' Tliis was a loss in one year of 79 per cent., or about four-fifths of his business. ' Trusts, Congress, 1888, p. 589. CHAPTER XVn IN THE INTEEEST OF ALL The difference in freights against Rice was so great, as the Interstate Commerce Commission found, after taking hun- dreds of pages of testimony, that he had to pay $600 to $1200, "or more," on the same quantity his opponent got through for $500. These discriminations were made, as the commissioners say, "on no principle. . . . Neither greater risks, greater expense, competition by water transportation, nor any other fact or circumstance brought forward in defence, nor all combined, can account for these differences."' The railroads had, of course, to give some reason, and they put forward the plea that it was much more expensive and dangerous to carry Rice's shipments, which were in barrels, than those of the combination, which were in tank-cars." This excuse for charging him rates at which lie could not ship at all did not stand examination by the Interstate Commerce Commission. But he did not wait for that. When he found the rail- roads were so fond of tank-cars, he set about getting tliem. He wrote the general freight agent and the president of the road that he would build tank-cars, and asked what his rate would be then ; but he got no answer. He wrote other roads, but got no answer. He asked the general manager of the Queen City and Crescent Route the same question. After a correspondence of five months with him and other officials, in which he was shuttlecocked from oue to another and back again, he had not only not succeeded in getting any tank-car ' Trusts, Congress, 1888, pp. C8S-89. '' See ch. xi. 228 IN THE INTEREST OF ALL rates, but at tlie end of that protracted exchange of letters the general manager wrote : "I was not aware tliat you bad asked for rates on oil in tank-cars." ' Rice wrote the Louis- ville and Nashville : " I will build immediately twenty tank- cars if you will guarantee me ... as low a net rate as ac- corded any other shipper." Commenting on his failure to get answers, the commissioners say: "Complainant did not succeed in obtaining rates. The denial of his right was plain, and stands unexcused. . . . What reason there may have been for it " — the refusal of rates — " we do not know, but find that they were not just or legal reasons." ' How history is made ! One of the reasons given by the solicitor of the oil trust ^ for its success is its use of the tank- car, with the obvious inference that its would-be competitors had no such enterprise. And Peckham, in his valuable and usually correct " Census Heport on Petroleum," in 1885, says that the railroads require shippers to use tank-ears I * Determined to keep in the field and to have tank-cars, if tank-cars were so popular with the railroad officials, Eice went to the leading manufacturers to have some built. He found they were glad to get his contract. After making arrange- ments at considerable trouble and expense to build him the cars, they telegraphed him that they had to give it up. Bankers, who had promised to advance them money on the security of the cars, backed out " on account of some supposed controversy which they claim you have had with the Stand- ard Oil Company and various railroads in the West. They feared you could not use these cars to advantage if the rail- roads should be hostile to your interests." ' Through the all-pervading system of espionage, to -which cities' as well as individuals were subject, his plans had been discovered and thwarted. The espionage over shipments provided for by the South Improvement scheme has now > Trusts, Congress, 1888, p. 607. ° Same, p. 6Y8. = Combinations, by S. C. T. Dodd, p. 29. ••"Petroleum and Its Products," by S. F. Peckham, U. S. Census. 1885, p. 92. * Trusts, Congress, 1888, p. 614, ^See ch. xxiv. BLim)BILLING TSEIB FAVORITES 229 extended to business between mannfactnrer and manufacturer. Why should it stop at unsealing private correspondence in the post-office in the European style, and making its contents known to those who need the information for the protection of their rights to the control of the markets ? Kice, who was nothing if not indomitable, finally got ten cars from the Harrisburg works. But this supply was entirely inadequate, and he had to continue doing the bulk of his busi- ness in barrels. What a devil's tattoo the railroad men beat on these barrels of his ! They made him pay full tariff rates on every pound weight of the oil and of the barrel, but tliey hauled free the iron tanks, which were the barrels of his rivals, and also gave them free the use of the flat-cars on wliich the tanks were carried.' Hauling the tanks free, on trucks furnished free, was not enough. The railroads hauled free of all charge a large part, often more than half, of the oil put into the tanks. In the exact phrase of the Interstate Commerce Commission, tliey made out their bills for freight to the oil combination "regardless of quantity." This is called " blind-billing." Of the 3000 tank-cars of the combination only two carried as little as 20,000 pounds ; according to the official figures there were hundreds carrying more than 30,000 pounds, and the weight ran up to 44,250 pounds, but they were shipped at 20,000 pounds.'' A statement put in evidence sliowed that shipments in tank-cars actually weighing 1,637,190 pounds had been given to the roads by the combination as weighing only 1,192,655 pounds. Cars whose loads weighed 44,250, 43,700, 43,500, 36,550 pounds were shipped as having on board only 20,000 pounds. At this rate more than one-quarter of the transportation was stolen. The stockholders of the road were paying an expensive ' Tcstimonv, Rice cases, lateretate Commerce Commission, Nos. 51-60, 1887, p. 144. = Trusts, Congress, 1888, .pp. 587, C75, 680. Rice cases, Nos. 51-60, 1887, pp. 487-88. For similar preferences to tlie palace cattle-car companies, see report on " Meat Products," United States Senate, 1890, p. 18. 230 IN TBE INTEREST OF ALL staff of inspectors to detect attempts of shippers to put more in their cars than they paid for, but these shippers paid for tliree car-loads and shipped from four to six regularly, and were never called to account. This " blind-billing," the Commission said, was "specially oppressive." It was done by the roads in violation of their own rule. It had been mutually agreed among them, and given out to the public, " that tank-cars shall be taken at actual weight." ' AVhen Kice was trying to get the roads to allow him to use tank-cars, he asked how the charge on them was calculated. Of those that answered none answered right. ISTone of them gave him the slightest intimation that there was any such practice as " blind-billing." On the contrary, they assured liim he would have to pay for every pound he sliipped. Tiie Mis- souri Pacific replied with a " statement not warranted by the facts," as the Commission softly put it. They said they charged for the " actual weight," while, as the Commission shows, they made shipments "regardless of quantity." Kice asked the Newport News and Mississippi Valley Ilailroad for tank-car rates. "A tank-car is supposed to weigh (carry) 20,000 pounds ; if it weighs more, then we will charge for it." At the same time the agent wrote Kice this, he was hauling cars containing 35,000 pounds "with no additional charge." "If this statement was made in good faith," the Commission says, "it is difficult to account for it, and it is not accounted for." "Had he (Kice) provided himself with cars for tank shipment, and been charged as he was told he would be, the discrimination against him would have put success in the traffic out of the question." When they wanted to turn some new screw in freight rates against Kice, the railroad officials would whip themselves around the stump by printing a new tariff sheet on a type- writer, and tacking it, perhaps, as one of the Interstate Com- merce Commission said, on some back door in their offices. This they called "publishing" their rates, as required by the 1 Rice cases, Nos. 51-60, IBS'?, p. 471 ONS OP THE TRUST TESTIFIES 231 Interstate Commerce law. To Rice, asking for tank-car rates, they would send tliis printed sheet, showing that if he shipped by tank-car he must pay for every pound, and they held him off with this printed, official, and apparently authentic tariff, though shipping M,000 for 20,000 pounds for the trust. This was done after the Interstate Commerce Act went into force.' One of these roads assured Rice that its rates had been fixed "by the special authority of the National Railway Com- missioners." The fact was, as the Commission declares: "The Commission never investigated coal-oil rates, or gave special authority for their renewal; it never sanctioned any difference in the rates as between tank-car and barrel shipments, and had never, up to the date of this letter, had its attention called to them in any way." ' The representative of the combination was called as a wit- ness before the Interstate Commerce Commission. " We pay for exactly what is put in the tanks," ° he testified. " In fact, this was never done," says the Commission.' Even the rail- road officials, who could go any length in "blind-billing'" for him, could not "go it blind" on the witness-stand to the ex- tent of supporting such a statement. " Our price per tank-car was not based on any capacity or weight ; they have been made simply per tank-car." ' " What, generally, is the object of false billing?" " I suppose to beat the railroad company." ° In defence of the discrimination against the barrel shippers, a great deal has been made of danger from fire, damage to cars from leakage, and trouble of handling in the case of barrel shipments, but the best expert opinion which the Inter- state Commerce Commission could get went against all these plausible pretences.' The manager of the tank line on the Pennsylvania roads showed that the risks were least when, the transportation was in barrels. Another reason given for the lower rates on tanks was that they returned loaded with 1 Trusts, Congress, 1888, pp. 675, 6'79-8'7. = Same, p. 682. 3 Rice cases, Nos. 51-60, 1887, p. 47. * Trusts, Congress, 1888, p. 675. = Rice cases, Nos. 51-60, 1887, pp. 108-9. 'Same, p. 120. ' See ch. xL 232 IN THE INTEREST OF ALL turpentine and cotton-seed oil from the South ; hut, as the Interstate Commerce Commission sliows, tliis traffic was taken at rates so astonishingly low that it was of little profit;' and tlie commissioner of tlie Southern Kailway and Steamship Association informed the Commission that the return freight business in cotton alone, brought back bj the box-care, to say notliing of other freight, was worth more than tliese back- loads of turpentine in the tank-cars.' It was, consequently, the box-car in which barrel shipments were made, and not the tanks, on which the railroad men should have given a better rate, according to tiieir own reasoning. Turpentine and cotton-seed oil are worth three or four times more than kerosene, and it costs no more, no less, to haul one than the other; but the railroads would carry the cotton-seed oil and turpentine for one-third or one-fourth the rate they charged for kerosene. The Commission could not understand why the rates given by the roads on these back-loads of turpentine and cotton -seed oil were so low. "This charge, for some reason not satisfactorily explained to the Commission, is made astonisiiingly low wlien compared with the charge made iipon petroleum, although the cotton-seed oil is much the more val- uable article."^ The newspapers of the South have contained many items of news indicating that the men who have made the oil markets tlieirs have similarly appropriated the best of the turpentine trade, but nothing is known through adjudicated testimony. Tiie trustees of oil have always denied that there was any connection between them and the Cotton-seed Oil Trust, although the latter shipped its product in tlie oil trust's cars. The reasons, tlierefore, for the "extraordinarily low" rates made on the turpentine and cotton -seed oil shipped North in its tank-cars must remain, until further develop- ments, where the Commission leaves it — " not satisfactorily explained." The railroads said they made tlie rates low for tanks because of the enticing prospects of these back-loads, ' Trusts, Congress, 1888, p. 674. ' Rice cases, Nos. 51-60, 1887, p. 480. ' Trusts, Congress, 1888, p. 674. TAX ONE TO FAT ANOTHER 233 in which there was no profit to speak of ; but they extended these special rates to points from which there was no snch back- loading.' Kice saw how the cost of sending his oil South could be reduced by bringing back-loads of turpentine at these " astonishingly low " rates. He found there was still turpentine in the Soutli he could buy ; but the railroads would not so much as answer his application for rates. " They absolutely refused." "Was this refusal since the Interstate Commerce decision in your case?" " Yes, sir ; since that decision." ' It might have been thought this would have been enough — hauling the tank itself free; furnishing the flat-cars free for many tanks ; carrying free a quarter to a half, " or more." But there was more than this. The railroads paid the combi- nation for putting its tank-cars on their lines. For every mile tliese cars were hauled, loaded or empty, the roads paid it a mileage varying from f to IJ cents. This mileage was of itself a handsome revenue, enough to pay a profit of 6 per cent, on its investment in the cars. Eut when Hice asked what the railroads would charge him for hauling back his empty tank-cars, he was not told that he would be paid for their use, as others were. He was told that he would be charged "generally a cent and a half a mile," or, "we make the usual mileage charge on return of empty tanks." " This last statement," the Interstate Commerce Commissioners say, " was not warranted by the facts." ' The vessel which contains the oil of the combination " receives a hire coming and going," Mr. Eice's lawyer said before the Committee of Congress on Commerce ; " that which contains Rice's oil pays a tax." When Eice tried to sell his oil on the Pacific coast lie found that if he shipped in tank-cars he would have to pay $95 to bring the empty car back, which others got back free. The representative of the oil combination was questioned about all this by the Interstate Commerce Commission. 1 Trusts, Congress, 1888, pp. 531-33. ^ Same, pp. 646-47. » Same, pp. 668-85. 234 'm THE INTEREST OF ALL " Are you allowed mileage on tank-cars ?" "No, sir." " Neither way ?" " Neither way." ' But the railroad officials again could not " blind-bill" him as far as this. Asked what mileage they paid him, they replied : " Three-quarters of a cent a mile."" "When the freight agents who did these queer things at the expense of their employers — i.e., their proper employers, the stockholders — wei-e put on tlie stand before the Interstate Commerce Commission to explain, they cut a sorry figure. " It was an oversight," " a mistake," said one. Another could only ring confused changes on "I think it is an error. ... I cannot tell why that is so. . . . It is simply an error. ... I can- not tell."^ There were never any errors, suppositions, over- sights for Eice.* Referring to this, the Commission says, caustically : " The remarkable thing about the matter is that so many of these defendants should make the same mistake — a mistake, too, that it was antecedently so improbable any of them would make. Tlie Louisville and Nashville, the Cincinnati, New Orleans and Texas Pacific, the Newport News and Mississippi Valley, and tlie Illinois Central companies are all found giv- ing out the same erroneous information, and no one of them can tell how or why it happened to be done, much less how so many could contemporaneousl3', in dealing witJi the same subject, fall into so strange an error. It is to be noted, too, that it is not a subordinate agent or servant who makes the mistake in any instance, but it is the man at the head of the traffic department, and whose knowledge on the subject any inquirer would have a right to assume must be accurate. In no case is the en'or excused." ' The cases in which Rice prosecuted the railroads before ' Rice cases, Nos. 51-60, p. 65. 'Same, p. 131. 3 Same, pp. 128-29, 143^7, 239. ■•Same, p. 109. Trusts, Congress, ISSS, pp. 675-76. 'Trusts, Congress, 1888, p. 688. riRTVES OF PAINT 235 the Interstate Commerce Commission are among the most important that have been tried by the Commission. The charges made by Kice were conclusively proved, except as to some minor roads and circumstances. The Commission de- clared the rates that were charged him to be illegal and unjust, and a discrimination that must be stopped. It ordered the roads to discontinue using their power as common carriers to carry Kice's property into the possession of a rival. " The con- clusion is irresistible that the rate sheets were not consider- ately made with a view to relative justice." ' The facts of these discriminations — "unjust," "illegal," and "abhorrent" — are on the records as judicially and finally determined. But one of the combination said before the Pennsylvania Legislature, at Harrisburg, as reported in the Harrisbui-g Patriot, February 19, 1891 : " I say to you all, in good faitli, that since tlie passage of tlie Interstate Commerce law, and the introduction of that system, we liave never taken a rebate. I mean we liave taken no advantage over what any other ship- per can get. I make the statement broadly, and I challenge the statement to the very utmost, and will pay the expenses of any litigation undertaken to tr}' it." "When it was found that this practice of charging the pre- ferred shipper for only 20,000 pounds when it shipped 25,000, 30,000, 40,000, or M,000, was going to be investigated by the Interstate Commerce Commission, there were intellects ready to meet the emergency. A pot of paint and a paint- brush furnished the shield of righteousness. Each car being known by its number, and only by its number, all the old numbers of the 3000 tank-cars of the oil trust were painted out, and new numbers painted on. Whether its mighty men left their luxurious palaces in J!few York, and stole about in person after dark, each with paint-pot and brush, or whether they asked employes to do such work, the evidence does not state. The device was simple, but it did. Eice was suing for his rights to use the highways before the Interstate Commerce Commission, and before the Supreme Court of Ohio, through ' Trusts, Congress, 1888, p. 689. 236 IX TEH INTEREST OF ALL the Attorney-General of the State, who had found the matter of sufficient importance to use his official power to institute suits in quo-warranto against two railroads. It was necessary that evidence should be forthcoming in these suits to prove what his rate was in comparison witii tlie others. The only way this could be done was by comparing the actual size of the cars with the size given in the freight bills, or manifests. Tlie cars are known in the bills only by their numbers, and without its number no car could be identified. The report of Con- gress reprints the following from the testimony of the repre- sentative of the trust before the Interstate Commerce Com- mission ; " Has there recently been any general change in the num- bering of tlie cars ?" "Yes, sir; there has been quite a general renumbering, re- painting, and overhauling." "When did that change take place?" " I think it was commenced some time in July ; it may have been later." The result of that renumbering made it practically impos- sible to identify any car as connected witli any shipment made before that time. The cars were there, looking as fresh and innocent as good men who have donned robes of spotless white earned by the payment of generous pew-rent. The cars showed even to the unassisted ej-e, as the Interstate Com- merce Commission said, how much larger tliey were tiian was pretended. There were still the accounts of tlie railroads, showing that these cars had been " blind-billed " as containing only 20,000 pounds, but the cars mentioned in the manifesto could no longer be identified with the cars on the tracks. The sin of "blind-billing" was washed out in paint. Eice went to the Interstate Commerce Commission with his com- plaint in this case in July. Immediately the repainting and renumbering, took place. "It was commenced some time in July ; it may have been later." ' 1 Trusts, Congress, 18SS, pp. 698-99. Testimony, Kice cases, Nos. 51-60, 18S7, p. 2S. " TKE GOSPEL CAR" 237 In such cases time is money, and more. "Seest thou a man diligent in business, he shall stand before kings. He shall not stand before mean men." The members of this combination have many thousand tank-cars engaged in carrying their oil, and some of them have another kind of tank-car travelling abont the country. Under the head of the " Gospel Car " the Daily /Statesman, of Portland, Oregon, printed the following article, Sunday, De- cember 13, 1891: "The Gospel Car. — The mission car 'Evan- gel' arrived yesterday, and was side-tracked on the peniten- tiary switch. A song service attracted many people during the morning. There will be services at 10.30 this morning, and in the afternoon, at 3 o'clock, a Sunday-school will be organ- ized. This will be the first Sunday-school ever organized from the gospel car, which hns been on the road since last spring. The ' Evangel ' is sixty feet in length, ten feet wide, and seats nearly one hundred people. It is the generous gift of" — ^sev- eral iS'^ew York millionaires, the most important of them be- longing to the oil trust — ". . . to the American Baptist Publi- cation Society. The reverend gentleman wiio was in charge of the 'Evangel,'" the Statesman continued, "will visit the smaller towns along the railway, and conduct evangelistic meetings in the car." One of these cars was in Cliieago early in 1893, and was admiringly described by the Chicago press. Though corporations have no souls they are ready to help save the souls of others, for the railroads give these cars free haul- ing, and the messages and the packages of its occupants are franked by the telegraph and express companies. The con- tents of this tank-car are distributed by its donors to the peo- ple without money and without price. It is conceivable that by making it so "cheap"' and by multiplying the "Evangel" into an evangelical tank line of thousands of cars, the donors might drive the churches, which have no tank-cars, out of the business, as they have done the tankless refiners, and ulti- mately add to their monoply of the Light of the World that of the Light of the other World. The effect of all this on the family co-operation at !Marietta 238 IN TEE INTEREST OF ALL does not need to be described. Its head told Congress that if he had iiad no difficulty in getting the same freight as others he could have run his refinery to its full capacity, and could have increased his works largely. "Are not j'our expenses less than theirs?" " Yes, sir. ... I am running very moderately now. . . . One- third to one-half generally." ' " I am virtually ruined," he saj's still later in a statement of his condition in a circular to the public, urging them to peti- tion Congress to make the imperfect Interstate Commerce law operative. He is virtually ruined, though he has won his cases before the Interstate Commerce Commission, and that Federal tribunal has ordered the roads to give him his rights on the highways; but it has been a barren victory. His cir- cular is entitled "My Experience Very Briefly Told." Its opening sentences give us in a phrase the secret of the signifi- cance of Rice's story, and dignify his appeal to the public. They show how thoroughly adversity had driven home into this ]>lain man's mind a great civic truth which his fellow- citizens have not yet learned, probably because they have not yet had adversity enough. His solitary and fruitless, altliouo-h successful, struggle taught him that the citizens of industry can no more maintain their rights acting singly than the citi- zens of government. He had learned that "competition," "supply and demand," "eternal laws of trade," were catch- words as impotent in the markets to give individuals their rights, if nnaEsociated,as the incantations of royalty and loyalty, and law and order, to save people from their king until they made themselves a People. Persons fail ; only a People can get and keep freedom. This Rice had begun to learn from his failure to enforce single-handed rights which all the courts declared were his, but which no court could secure. In his card to the people, he said: "I am fighting for my rie;hts and for my existence (which happens to be in the interest of all) single-handed and alone, at my own expense and time lost. . . . ' Trusts, Congress, 1888, p. 62-3. BABREN VICTORIES AT LAW 239 I am here ... to do what I can to get the Interstate Commerce Act amended at this present session of the Fiftieth Congress, to cure existing evils, and all I ask is that you will take hold and assist me by your signature and approval to the enclosed petition. Ton are subject to the same influences, .and now is your time, my fellow-countrymen, to come forward and assist a little to stop this nefarious work." " In the interest of all." This is exactly the relation which the struggle of this common citizen bears to the general wel- fare. The investigation by the Ohio Legislature in 1879;' the removal by the United States Court of the railroad re- ceiver who agreed to pay the oil trust $25 out of every $35 freight collected from Eice;° the refund ordered by the Su- preme Court of Ohio from a pipe-line company which had charged Eice 15 cents extra on every barrel he shipped to pay it to his competitors ; ° the successful prosecution, by the Attor- ney-General of Ohio before the Supreme Court, of the rail- roads discriminating against Kice;'' the cases before the In- terstate Commerce Commission from its beginning till now, involving hundreds of railroads, and decided, so far as it did decide, on almost every point in Rice's favor ;^ the disruption, as far as forms go, of the oil trust in Ohio by the Supreme Court of the State ousting corporations from the right to be- come members of such combinations and to pool their earnings therein ;° the investigation of the oil trust by Congress in ISSS and 1889, devoted in large part to the various aspects of Kice's experience — these are some only of the public functions which had to be invoked in the ineffectual attempt to protect this one man on the high-road and in his livelihood, and they show how little his was merely a " private affair." » See p. 205. 2 gee p. 206. 'BvundreJ, et at vs. Kicc, decided November 1, 1892, 49 Ohio State Reports. ^Seep. 219. 'For the decisions in these Kice cases see Interstate Commerce Commission Report, vol. i., p. 603 ; same, p. 722 ; vol. ii., p. 389 ; vol. iii., p. 186 ; vol. iv., p. 228 ; vol. v., p. 193, and same, p. 660. ° The State of Ohio ex rel. David K. Watson, Attorney-General, vs. The Standard Oil Company, N. E. Reporta; vol. xxx., p. 279; 49 Ohio State Reports, p. Z\1. 240 7^V THE INTEREST OF ALL When the amendment of the Interstate Commerce law was before Congress in 1889, eminent counsel were employed by Kice to explain the defects of the law to the committees, and petitions to Congress through his instrumentality were circu- lated all over tlie countrj', and numerously signed. Though a poor man, who could ill afford it, he gave time and money and attention, frequently spending weeks at Washington, dis- cussing the subject with members, and presenting petitions. The act was amended in partial accordance with these peti- tions and recommendations. To obtain the elementary right of a stockholder, never withheld in the conrse of ordinary business — to vote and receive dividends on stock in the oil trust which the trus- tees had sold and he had bought in the open market — Eice had to sue through all the New York courts from 1888 to 1892. The Court of Appeals decided that there had been no lawful reason for the denial of his rights, and ordered that they be accorded him. This was another barren vic- tory. The trust had meanwhile ostensibly been dissolved ; but the dissolution has every appearance of being like that of its progenitor, the South Improvement Company, a disso- lution "in name" only; not in reality. In place of the old trust certificates listed on the New York Stock Exchange, new certificates have been issued which were selling in the spring of 1894 at about the same quotation as the former ones. In this case the trust asked the jSTew York courts to deny Kice his rights because he had in other matters, and as to other parties, appealed to other courts. His other suits had been against the railroads, not against the oil combination. He acted on the defensive, and went into court only to save him- self from commercial strangulation. In all of them that went to trial he was successful, with but one or two exceptions. He was so successful that even the judges who heard his case and decided in his favor were moved to outbursts of unaf- fected indignation on the bench. The only result aimed at or procured was that the courts decreed that these common car- THE OFFENCE OF SEEKING JUSTICE 241 riers must in tlie future give this citizen his legal rights on the railways; not that lie must have the same rates as his op- ponent, but only that the difference in their favor shall not be "excessive," "illegal," "unjust." Because of this attempt to secure the fair use of the liigh- waj's side by side with it, the trust pleaded in the Supreme Court of New York that his appeal to courts as a shipper was a reason why the courts should withhold his rights as a stock- holder. In making this plea the trustees described themselves as having been for years persecuted by the independent of Ma- rietta, and moistened the dry pages of their legal pleadings with appeals for the sympathy of the courts and the public. He has "diligently and persistently sought to become ac- quainted with " our " methods of business and private affairs ;" "he has used efforts to injure" our "business"; "he is at- tempting to harass, injure, and annoy" us; "he has ever since . . . 187C, when he first engaged in business, . . . main, tained a hostile attitude, and been engaged in hostile trans- actions and proceedings against " us, — " for the purpose of in- juring" us and our "business"; he "has been uninterruptedly prosecuting ... a series of litigations ... in the courts, as well as before the Interstate Commerce Commission, and before an investigating committee of Congress . . . for the purpose of harassing and annoying" us.' And when in 1891 Hice was appealing to the Attornej-'General of New York to bring suit in the name of the State against the oil combi- nation in New York, like that which had been successful!}' brought in Ohio, he was publicly stigmatized in court as a "black-mailer" because he had once named a price at whicli he was willing to sell his refiner}' and quit. So the citi- zens of Nashville were called black-mailers for competing, and the citizens of Buffalo for bringing a criminal conspiracy to justice. ' Rice TO. Standard Oil Trust. New York Court of Appeals — Case on Appeal, ISSS. 16 242 USr THE INTEREST OF ALL It is this dancing attendance upon State legislatures, courts, attorney-generals, Congress, the Interstate Commerce Com- mission, as shown in this recital, which the modern American business man must add to Thrift, Industry, and Sobriety as a condition of survival. CHAPTER XVIII OEDINAET SUPPLY AND DEMAND "Do I understand yon that they have not sought in any way to make the operations of refineries outside the trust so unprofitable that parties would either come into the trust or have to abandon the business — has anything of that sort been done?" " They have not ; no, sir, they have not," was the triple negative of the president. " They " (the trustees) " have lived on good terms with what I may call their competitors?" " They have ; and have to-day very pleasant relations with those gentlemen." "So far as you know," he was asked, "the product of the cnide oil and the manufacture and sale of the refined oil has been absolutely left to the ordinary rules of supply and de- mand, has it not ?" " It has." '■ In. the winter of 1873 a J'oung farmer living among the blue hills of Wyoming, in western Isew York, where he had been born and bred, was asked by a stranger from Eoch- ester to help him in a search for oil lands. The old-fash- ioned quiet of the little community was agitated by the hope that the milk and honey of their valleys might be re- placed by a more precious flow. The stranger and his son were prosperous oil refiners, but a little cloud, about the size of a "trustee's" hand, had crept into their sunshine. As they set about drilling a well on some "likely-looking" land ' Testimony, Trusts, New York, 1S8S, pp. 385-87. 244 ORBINABT SUPPLY AND DEMAND they had leased, tlie stranger told the faruier why he was so anxions to strike oil for his own exclusive use. The reader is better prepared to understand his explanation than the then inexperienced agriculturist to whom he gave his confidence. It had begun to be difficult for him to get a full and regular supply of the crude petroleum for his works. There were restrictions, he said, about the shipments.' What that meant the young farmer was to learn for himself. There was no oil in Wyoming, and the refiner went back to Eochester, and, as so many others have done, sold the con- trol of his works, the Vacuum, to the " successful men " of tlie combination, and stepped silently into the minority place. His Wyoming friend, Charles B. Matthews, had con- tinued in his service, and when the Vacuum was sold he and two other of its employes made up their minds to go into the business of refining in Buffalo on their own account. They were under no obligations or contract to remain, and did not suppose themselves to have been sold along with the concern. They were capable men, and showed great business sense in their arrangements. Buffalo, by its connections by rail and the lake with the market, and its nearness to the oil supply, was a much better situation than Rochester or Cleve- land. An independent refining company — the Atlas — was then constructing an independent pipe line from the oil re- gions to Buffalo. " This made Buffalo the best point for es- tablishing refining industries in the country, with its canal and lake transportation for the products of the factory, and with a pipe line, in the hands of independents, from the crude oil wells to the city," said the Buffalo Express. Matthews had b}- this time had several j-ears' experience in the business. Of the two with him, Albert was a laborer, who had woi-ked his way up in the Vacuum refinery until he could run the stills, and had learned how to make oil. He and his thrifty ' People of the State of New York t'S. Everest et al. Court of Over and Ter- miner, Erie County, February, 1S86, court stenographer's report. This item is omitted in the transcript of evidence furnislied by the oil trust to the Committee of Congress investigating trusts in 1888. See Trusts. Congress, 1838, p. 801, A FARMER AND A WORKING-MAN 245 wife had saved a few thousand dollars. lie was ambitious. He had learned at school and in the army and at Fourth-of- July celebrations that America is a free country for all, and that there are no classes here, and that any workman may go to the top. Farmer Matthews had fed his boyhood with stories of country boys who had gone to the city and matnred into business magnates. He and Albert pooled their visions and their savings, borrowed some money, and went to work. As for competition, though they knew it was close, they were not afraid but that they could hold their own in a fair fight, and of anything but a fair fight they never dreamed. " How are you going to get your crude oil ?" Albert and Matthews were asked when they went to tell their employer what they were going to do. "From the Atlas pipe line." "You will wake up some day and find that there is no At- las Oil Company. " We have ways," he continued, " of making money yon know nothing about," using, singularly enough, the phraseol- ogy employed by a greater man in the interview with another would-be competitor.' " As gentlemen," he went on to say, " I respect you, but as to the Buffalo Lubricating Oil Company I shall do all in ray power to injure or destroy it." " Afterwards Albert alone was sent for. " Don't you think it would be better for you to leave these men, and have $20,000 deposited to your wife's credit than go with these parties ?" " I went out with them in good faith, and I propose to stay." " It will be only a matter of a few days with the Buffalo institution at the furthest. We will crush them out, and you will lose what little you have got." Albert was shown an elaborate statement of the cost of making oil and its selling price, proving that there was no money in oil.^ Tlie record of dividends was produced in > See p. 62. ' Testimony, Trusts, Congress, 1SS8, pp. 814, SS2, 883. 'Same, p. 815. 246 OHDINABT SUPPLY AND DEMAND court afterwards. It showed that just before this — January 18, 1881 — a dividend of 50 per cent, had been paid in one month.' Dividends of $300,000 had been paid in 1881 on the capital of $100,000. "No wonder they did not want competition," said the JSTew York World. These negotiations had been witli the son. Albert not yielding to this pressure, and pushing ahead with the con- struction of the rival stills, the father, who was in Califor- nia, came back. At his request Albert again interrupted the work on the new refinery, which he alone of the partners could direct, and came from Buffalo to Kochester for an interview. " You have made a grand mistake," said his old employer, " by going ont with those fellows. . . . The company will not last long. . . . The result will be, if you sta}' with them, you will lose all you have got in it. . . . We are going to commence suits against them. We will not only sue them, but serve an injunction on them and stop their work. The result of it is that when these suits commence, if you are in it, you will be responsible, and you have got a little monej', and you will lose it all. ... If you come back and work with us everything will be all right, and we will make everything satisfactory to you." " If I leave them it will leave them in bad sliape," Albert urged. " That is just exactly wliat I want to do," '' his former employer replied. Albert began to weaken. "I had," he afterwards told in court, ..." about $6000 altogetlier, or a little more. Tiiey had I'eason to know tliat I had some property there." ° This was all he had to show for the work of a lifetime, and it began to look as if it were fading away under these reiter- ated threats and warnings, which went on from March to June. Albert gave wa^'. He went to his lawyer, Mr. Trues- dale, of Rochester. "We ha've come," said his former em- ' Court Stenographec's Report, p. 1135. 'i Testimony, Trusts, Congress, 18S8, p. 816. =Same, p. 816. X VACUUM 247 ployer, who accompanied him, " to see what disposition can be. made of Al's property." " They are going to bust the company up," said Albert to his lawyer, when asked why he was going back to the Vac- uum Company. " I am an indorser on one of its notes, and if I do not come back with the Vacuum, what property and money I have will be taken away from me." The lawyer was pressed to tell how Albert could get out of his arrangement with his company'. They could not get along without him, and were not likely to discharge him. " If they won't release him or bu}' him out, the only other way," said the lawyer, " is to leave them, and take the conse- quences. If he has entered into a contract and violated it, I presume there will be a liability for damages as well as for the debts." "I think there is other ways for Albert to get out of it," said the representative of the Vacuum method in commerce and morals. "I see no way except to back out or sell out; no other hon- orable way," persisted the lawyer. "Suppose he should arrange the machinery so it would bnst up or smash up, wliat would the consequences be ?" "If negligently, carelessly, not purposely done, he would be only civilly liable for damages caused b^' his negligence ; but if it was wilfully done, there would be a further criminal liabil- ity for malicious injury to the property of the companj-." "You wouldn't want me, would you," said the poor man to his late employer and friend, " to do anything to lay myself liable ?" "You have been police justice," said the Vacuum man to the lawyer, " and have had some experience in criminal law. I would like to have you look up tlie law carefully on that point, and we will see you again." ' Or, in effect : " See about how much crime we can commit," District Attorney Quinby paraphrased it afterwards to the jurj*. 'Testimony, Trusts, Congress, 18SS, pp. 817, 872-74. 248 ORDINARY SUPPLY AND DEMAND III a day or so the two managers of tlie Vacuiiin — father and son — came back again with Albert. " Have you looked up that matter, Mr. Truesdale ?" asked they. " Yes, I have looked it up." " What do you think about it ?" "My impression has not changed. Such a course would involve him in a criminal liability if he did it on purpose. Everybody who advised or counselled him in such a course would be equally liable with him. The consequences, if you follow that course, would be that you would get into State's prison. If he is an honest man lie won't think of taking any such action as that. I advise him to keep out of any such thing." '• Such things will have to be found out before they can be punished," was the Vacuum reply. "They will have to find him before they can do anything to him. We will take care of him." " Having in mind," said District Attorney Quinby to the jury, " what happened afterwards— that they should spirit him awaj'." " Tiie suggestion is altogether wrong," persisted the lawj'er. " The action would certainly be very hazardous as well as wrong." On leaving, the elder of the two, evidently persisting in his plan, said to the lawyer, " If you want to communicate with Albert, you can do so through C. M." ' — his son. These men were too careless to note that the lawyer they were talking to was not their lawyer, but Albert's. "When the}' were brongiit to trial for the crime that followed, and Albert, repentant, told the truth, the lawyer was free to testify against them. " I am entirely willing," said Albert in court, " that Mr. George Truesdale shall state what took place. I withdraw any legal objections I might have." The accident which has let us see how the employes of a trust coolly debated with lawyers the policy of blowing up a ' Testimony, Trusts, Congress, 1888, pp. 81S, 81Z. JiT ADVICE OF COUNSEL 249 competitor's works, is one of the few glimpses the American public will ever get into the relations of great legal lights and law-reformers with the mighty capitalists who wreck railroads and execute wholesale corruption of courts, legislatures, and trustees, and evade a,nd transgress the laws with the sure march of those who know that indictments and bail-bonds and verdicts of "guilty" and the penitentiary are only for men not rich enough to plan crime " by advice of counsel." When such men went marauding through the treasury of a great railroad and the courts of an Empire State, we saw the greatest of law-reformers, with a host of legal luminaries, picketing and scouting for them. Every sound in nature is phonographed somewhere, as its waves strike, and Judgment Day will be rich with the revelations from these invisible rolls of the confiden- tial conversations between "trustees" and counsel, who are not honorable lawyers as George Trnesdale was, prostituting their functions as " officers of courts" into those of ofiicers of crime. All these trips from Buffalo to Kochester for these inter- views made bad breaks in the construction of the works of the new company at Buffalo. The partners, who were wliolly dependent upon Albert's knowledge and experience for the building of the refinery, and running it when built, were mystified and alarmed. Time and again he ran away without a word to them, and all work would stop until he came back. "When he was on hand his task did not prosper as if his heart were still in it. When one of the three stills of the refin- ery had been set up ready for nse, and before any oil was run, Albert went up to Rochester again. At this rendezvous the sinister suggestion of "doing something" was repeated. " You go back to Buffalo and construct the pipes and stills so that they cannot make good oil, and then if 3'on would give them a little scare . . . they not knowing anything about the business . . . you know how to do it." Swearing he would not consent, but already succumbing to this temptation, as he had given Avay to the threat of ruin, he replied as before: "I don't propose to do anything to make myself criminally 250 ORDINARY SUPPLY AND DEMAND liable."' At their suggestion he took a man they sent all through the new works, showing him how the stills had been constructed, how the oil was to be made, and all the details of the refinery." The day came at last — long expected, delayed by these un- accountable absences — when the members of the new com- pany were to have the happiness of seeing their enterprise set going. The one still that was ready was filled with crude oil. The morning of the start Albert weighted down the safety-valve with heavy iron, and packed it with plaster of Paris. "Fire this still," he said to his fireman, "as heavy as yon possibly can." The fireman did as he was ordered. During the forenoon Albert came to him. "Damn it!" he said, "you ain't firing this still half. Fire this still ! I want you to fire this still ! You ain't got no fire under it !" He took the shovel himself and threw some coal in, although there was, as the fireman expressed it, "an inordinary fire." The fire-box grew cherry red.^ Albert knew well enough what the next chapter in the history of his associates was likely to be. He had carried a dark-lantern into the still-room one day when he was superin- tendent of the Yacuum. " I was badly burned by the explo- sion," he testified before the eoronei-'s jury investigating the explosion in Koehester, in 1887. There were four explosions in the Vacuum woi-ks while he was there. In the second, four men were burned. As one of them ran to get water, with his clothes burning, he set fire to the gas coming out of the sewer. Flames flashed all about him. " There's hell all around !" he exclaimed. The third explosion came from an overheated condensing -pipe, and destroyed one of the build- ings. The fourtii burned up three tanks. Remembering all this, he now took himself off to the grounds of the Atlas Company, out of harm's reach. The brickwork about the still cracked apart with the heat. But the "smash-up or something" had not been thoroughly ' Trusts, Congress, 18SS, p. 820. ' See p. 64. = Trusts, CoDgress, 188S, p. 834. MATERIALS FOR EXPLOSION 251 arranged. Despite tlie heavy weight and the packing of plaster, the safet^'-valve lifted itself under the unusual press- ure, and was a safety-valve yet. It was blown open, and a large mass of vapor rose and spread. This was the real acci- dent: that the safet3'-valve broke loose instead of keeping the gases in to explode, as had been planned. The spreading %'apor was not steam, as that had not been admitted to the still, but the gas of distilling petroleum, as inflammable as gun- powder. There was danger still, as great almost as that of explosion. A spark of fire, and it would have wrapped all within its reach in flames. The boiler fires were but twenty feet distant ; not far from them the distilled oil was being gathered in the " tail-house " ; near the tail-house stood the tanks of crude oil, hundreds of barrels of the fuel that con- flagration loves — the kind of fuel the cooks use who, begin- ning with kerosene for kindling, make the whole house into a stove, and cook themselves and the family with the breakfast. The kindly wind of a June day carried the cloud of gas away from the fii-e until it passed out of sight. The unsus- pecting, inexperienced men, whose lives and property had been at the mercy of explosion, knew nothing of their peril until years afterwards. Tlie worst they knew then was that the " batch " of 200 barrels of petroleum was spoiled, and that Albert, the only practical man among them, was gone, leaving them crippled for a year. They waited for him, but lie did not come. They looked for him, but could not find him. Matthews went to the depot night after night, sometimes at midnight, or later, to watch the trains, but Albert never came. "What would be the consequences?" Albert was asked afterwards in court, when he was telling about " the pretty heavy fires" he had made under the still — "what would be the consequences in case too hot fires were applied, and the gas should blow off the pipes and become ignited ?" "The consequences would be that, if ignited, there would be a fire." ' ' Trusts, Congress, 1888, p. 826. 252 ORDINART SUPPLY AND DEMAND An Associated Press despatch from Louisville, Kentucky, June 30, 1890, describing an explosion in an oil refinery there, and the "five acres of fire" that followed, reproduces for us the picture which it had been planned to paint at BnfEalo as part of the panorama of " the ordinary rules of supply and demand." A tank-car had been opened to run some oil out. As the workmen lifted the cap from the manhead of the tank a cloud of gas poured forth. It had been generated simply by the heat of the summer sun, without the aid of an "inor- dinary" hot fire. The men jumped and ran. Before they had taken a dozen steps the vapor, spreading over the ground and moving with the wind, had reached one of the sheds near by in wliich there was a fire. There was a flash. The men were bathed in a lake of fire. They ran with the flames streaming from them. At the infirmary their bodies were found to be charred in spots, literally roasted alive, and the flesh dropped ofE as their clothing was removed. Three men died and several were injured. Several years after the Buffalo explosion, when those con- victed for their part in it were fighting for stay of proceed- ings, new trial, anything to escape sentence, and were trying b}' every means in their power to impress upon the public the altogether innocent character of the little incident at the works of their rival, something happened at their own works — the Vacuum in Rochester — which gave the people an appalling sense of the terrors of the new school of supply and demand. Naphtha is one of the by-prodncts of petroleum distillation, and is used by the gas companies in the manufacture of the greased air they furnish under the name of gas. The Vacuum Company were selling their naphtha to the Eocliester Gas Company. It was delivered to the gas company through a pipe line. On tlie afternoon of December 21, 1887, there was an explosion on Piatt Street, Rochester, tearing away the pave- ment, shattering the basement of a building, and filling the air with missiles. In a few seconds another explosion occurred a short distance away, making a hole in the street several feet in diameter, from which came large volumes of smoke and THE "BUST-UP" IN PRACTICE 253 flame. A third arid fourth "bust-up" rapidly followed, and then a fifth, in the Clinton Flouring Mill, tearing away a con- siderable portion of the building, blowing oflE the roof and upper stories of the Jefferson Mill adjoining, and shattering the Washington Mill. The Jefferson and Clinton and Wash- ington mills were burned to the ground. People were killed by flying debris, burned to death, smashed by falling walls, crippled by jumping from the upper stories of factories and mills on fire. " There is probably no chemical product," says Professor Joy, of Columbia College, "which has occasioned the loss of so many lives and the destruction of so much prop- erty as naphtha. . . . From its highly explosive and inflamma- ble nature it has proved little better in the hands of ignorant people than so much gunpowder." " The counsel for the defence," said District Attorney Quin- by, in summing up the case before the jury, "laughed at the idea of Matthews and his associates coming to Buffalo with a little money to compete. I congratulate him that instead of de- fending for conspiracy he is not here to-day pleading for the de- fendants' lives. If a person had been killed, and it had been under the advice and instruction of his clients, he would have been differently situated from what he is to-day. How well 3'ou men may be thankful that the gases from this still did not flow down and, becoming ignited, explode and kill the fireman ! You ought to get down on your knees and thank your God that Providence prevented any such terrible thing as that for you." After the "bust-up" had been planned, and before it was done, one of the Vacuum managers went to ISTew York, where the " trustees " for whom he was managing the company were. After the " bust-up " Albert heard by telegram from New York, as had been arranged, and went to meet his old em- ployer. "What do 3'ou say to going down to Boston?" he was asked on his arrival. Later a man came in and was in- troduced by the name of one of the three trustees who pur- chased and directed the Vacuum. On leaving, this " trustee " said : " I will see j'ou again if you do not go to Boston." He thus showed that he knew of the plan that Albert should be 254 ORDINAET SUPPLY AND DEMAND taken away, and that they should go to Boston. The man- ager of the Vacuum now gave the world a genuine illustration of the harmony of labor and capital. He couldn't let Albert out of his sight. They went to Boston on the Fall River boat. The representative of a hundred millions took the laborer into his own state-room, and at Boston carried liim into the splendors of Young's Hotel, where he registered, naming himself "and friend," and they shared one bedroom. They went to church together, and to Nantasket Beach, liis friend introducing Albert to those whom they met under an assumed name. "You don't want to be known here," he said, " and I will introduce you by the name of Milner." " That is the name I was known by while I was there." "Albert has nothing to fear," said District Attorney Quin- by on his trial. "He had never been in Boston before in his life. He had no acquaintance there. There was no rea- son why he should be registered ' and friend ' at the hotel. There was no reason, so far as he was concerned, that he should be introduced under a fictitious name, except that his employer had been schooled in the wonderful university known as" the oil combination. In Boston, on a Monday, on the Common, within sight of the equestrian statue of the Father of his Country, his former employer made a contract with Albert to pay him $1500 a year for doing nothing ex- cept staying away from Buffalo. "You won't have much to do, and you can stay here in Bos- ton, and keep away from those fellows, and we will protect you." " Who's going to make up if those fellows come on and sue me for damages ? Who will make up this loss that I have been going to by sacrificing ray property?" "Leave that to me; I will fix that all right. You do just as I tell you, and you will come out all right. . . . Go wherever you like, stop where you like, and we will pay all your expenses while you are here." ' ' Trusts, Congress, 18S8, pp. 821-22. WOSD CAME FROM NEW YORK 255 Albei't loafed about Boston several weelcs, sometimes help- ing to roll a barrel of oil in the Vacuum's store. When he wanted money he asked for it and got it. He had once been a hard drinker. Destruction was as carelessly invited upon the soul of a poor brother as upon the lives and propei'ty of competitors. He hung around Boston and Rochester nearly a 3'ear. Then his old employer, who was in California, sent for him to come there to help in a fruit cannery, his salary continuing as before. From the moment he deserted his partners, as Judge Edward Hatch, the counsel for Matthews, stated in the civil suit for damages in this conspiracy, Albert " never earned enough to cover the end of your knife-blade with salt at your dinner. But they pay him, in salary and bonus, over $4000. Why? To get him awaj', and to stifle lawful, legitimate, and honest competition ; to stifle that which brings into every poor man's home an article of necessity at a cheaper rate." He stayed in California a few months, and, finally, sickened of the disgraceful part he was playing, turned at bay, and gave notice that he was going to leave. " This is kind of sudden," the agent of his employers replied, but said he would write to the principal director in ISTew York .and advise tliat he release him. "You will give me time, won't you? You know it takes a couple of weeks or longer to do business from here to New York." Albert waited, and in time the word came from ISTew York. " I have heard from these parties, and they are willing to release you." ' Albert, who had put himself into the extraordinary position in which he was on the repeated pledges of the tempters that they would make it "all right" with him, and protect him from loss and harm, found that he had put his " trust in princes." When he came to settle he expected that those for whom he had sacrificed his honor, his property, and his career would make him some compensation. In answer to the ques- tion how much they ought to make up to him, he named $5000 or $10,000, which was certainly little enough, in view 1 Trusts, Congress, 1888, pp. 824-25. 256 OBDINAET SUPPLY ASD DEMAND of the fact that the business he had sacrificed to them was one in whicli, as the Vacuum's career showed, $100 shares came to be worth $2666 each. But the representative of the trust declared he could not think of such a thing, and in full of all obligations gave him nothing but the balance due of the wages agreed on. Then he asked Albert to hold himself still fur- ther at their service. As they parted, he said: "Now we have settled up; now we aregood friends. . . . If anything ever comes up in this matterl would like to have j'ou stand by us. . . . We will see that you are paid all right, and give you $25 a da}- while we need your services." Albert replied that he did not feel under any obligations to the oil combination. "I do not know as my interest lays that way. I do not think I shall do anything to benefit them ; they have injured me all that they can ; they have switched me all around, all over the country ; they have got me out of employ, not given me anything todo, which I sought to have them do. I do not think they have used me riglit, and I have sacrificed considerable money b}' this transaction, and you have always promised that it would be made good, and you have not done so." ' ' Trusts, Congress, 1888, pp. 825-26. CHAPTER XIX THEOTJGH THE WOMAn's ETES Matthews knew notliing and suspected notliing about tlie worst part of the plot against him until Albert's lawyer, Mr. Truesdale, nearly four yeai-s later, was called upon to testify in the suit Matthews brought for damages against the Vac- uum people. This suit was to recover from them for having enticed Albert away, and having persecuted Matthews with false and malicious suits ; but Truesdale's evidence at once revealed that there had been a deeper damnation still in the conspiracy against him. Mr. Matthews, one day on the street in Buffalo, ran across Albert, who had just come back from California. " No man ever used another meaner than I have you," said the now repentant man to him, volunteering all the informa- tion he had, and agreeing to testify if called on. This reve- lation made the farmer -refiner a I'eformer. This was the public's business. If such things could be plotted and done with impunity by one man against another, there was an end forthwith of every liberty the republic boasted. Especially menacing was such a conspiracy when concerted by the rich fanatic of business against the poorer citizen to prevent the latter from disputing the claim that a great market was a private preserve, and that tlie right to trade in it is a privilege which " belongs to us." ' Matthews could have used his dis- covery as an irresistible weapon to force his enemj'- to his knees, but he laid his evidence before the district attornej^ This official presented it to the grand-jury, which found that ' See cli. xxxi. 17 258 THROXJQH THE WOMAN'S EYES the facts warranted indictments. "When the first indictment was quashed on technical grounds a second grand-jury, sifting the facts, agreed with tlie first that the accused should be held to answer in the criminal courts. This was six j'ears after the crime. The five persons indicted were the two former owners of the Vacuum, now the resident managers of it for the com- bination, and the three members of the oil trust, as the combi- nation then called itself, who had bought the Vacuum for it, and had been elected by the trustees directors to manage it for them, and had so managed it even to the most picayune details. The case caught the ears of the woi'ld, not because crime was charged against men who had dazzled even the gold -filmed ej-es of their epoch by the meteor -like flash of tlieir flight from poverty into a larger share of "property" — the property of others — than any other group of millionaires liad assimilated in an equal period ; not for that, but because the charges of crime against these quickest-richest men were to be brought to trial. Members of the combination had been often accused ; they had been indicted. This was the first time, as District Attorney Quinby said in his speech to the jury, that they had found a citizen honest enough and brave enough to stand up against them — the only one. "There is no man," he said, " so respected to-day in Buffalo as he for the method he has used to bring these men to justice." He suc- ceeded in doing alone what the united producers of the oil regions failed to do, although their resources were infinitely greater. The people of the entire oil country failed utterly to do so much as get the members of the oil combination, when indicted for conspiracy in 1ST9, to come into court to be ti-ied. All its principal men were indicted — the president, the vice-president, the secretar}-, the cashier, and others. They could not even be got to give bail. One of them had said when the indictments were found, that the case would never be tried, and it never has been. The Governor would not move to have those of the accused who were non-residents extradited, as he would have done, does dail}^, in the case of poor men, and the courts so tangled up the questions of pro- GRACING A CEIMINAL COURT 259 cedure that the people withdrew, and left the indictments, as they remain to this day, on file in th6 Clarion County court, swinging like the body of some martyr on a road-side gibbet in the pagan days, polluting the air and mocking justice.' That the trust was thoroughly alarmed, and saw the neces- sity of rallying all its resources to save itself, was apparent from the formidable display with which it appeared in the court- room. Present with the five defendants, as if also on trial — a solid phalanx — were its president, the vice-president, the manager of its pipe-line system, the princijDal representa- tives of the trust in Buffalo, 'and many others. Their regular attorney of New York was present with two of the leading lawyers of Buffalo. Besides these there was a distinguished man from Eochester, reputed the ablest lawyer in western New York, wliose voice is often heard in the Supreme Court at Washington. He had two important members of the Eoch- ester bar as assistants, one of them in the summing up un- mercifully scored by the District Attorney for fixing wit- nesses; and, not least, a well-known United States District Attorney, who made the convention speeches by which a distinguished citizen of Buffalo was nominated, successively and successfully, for Sheriff, Mayor, Governor, and President. The defendants come here, said the people's attorney, with the best legal talent the country affords, the best the profes- sion can furnish ; for the trust — " they are practically the de- fendants in this action — witii its great wealth, has the choice of legal talent." Other eminent lawyers were also consulted, but were not present. Never was a weak defence made the most of with more skill than these gentlemen exhibited upon the trial. . . . But great as was the ability of the defence, Mr. George T. Quinby, the District Attorney, and his assist- ant, William L. Marcy, proved a match for them. Every political and moneyed influence that could be brought to bear was used to mislead the District Attorney, but all to no pur- pose. The jury could see that the complainant, Charles B. 'History, etc., Petroleum Producers' Unions. Trusts, Congress, ISSS, pp. 650-716. 260 THUOUOB the WOMAN'S EYES Matthews, did not get the indictment to sell out, otherwise he would have sold it out and not have insisted uj)on a trial. The fact that the case was on trial, at a cost of many thousands of dollars to the defendants, was conclusive upon that point. An emissary, trying to get Matthews to call ofE the District Attorney and to hush up this criminal prosecution, said the oil trust could " give him anything, even to being governor of a Western territory." ' " You will have a chance," Matthews told the District Attorney, " to line the street from your house to the City Hall with gold bricks." But tliis public prosecutor had no price. He grasped the full scope of this extraordinary case, which involved not only a crime against persons and against the people, but against that true com- merce of reciprocal and equal service on which alone the new civilization of humanity can rest. The room in the BufEalo court-house, where the case was being heard, was bright with the sunshine of a May day, putting out the shadows of indictments and verdicts lurking in corners and pigeon-holes. Although it was a criminal case, the on-looker saw, strange as it seemed, that whatever strain there was in the situation appeared to be felt least by the accused, and most by the piiblic and the jnr}'. The nearer the ej'es of the on-looker travelled towards the prisoners, the lighter and brigliter was the scene. Close to the accused sat a bench full of notables, evidently friends lending moral sup- port. That the bench was occupied by men of importance was evident. The}- were supported b}' platoons of eminent counsel and detectives. Onlj^ the judge betrayed no con- sciousness of the presence of the herd of millionaires. The whisperings and pointings and namings by one spectator to another showed that the people's curiosity was greatly excited by the sight of the richest men in the country, if not in the world, with attendant millionaire esquires in or about the dock of a criminal court. On this particular daj- the notables and their suite had come in speciall}' good-humor. Nods of kindly ' Testimony, Trusts, Congress, 1888, p. 942. AN ENJOYABLE OCCASION 261 recognition went abont and smiles rippled everywhere as, settled into their seats, they listened to the recital by the witnesses. It had been as good as a play to hear the work- ing-man, Albert, tell on the stand how he had been bribed and threatened with ruin until he yielded to the suggestion that he should " bust up " the works of his friends, partners, and employers, and run away. There had been nothing funny to Albert in those threats : " We will ruin you," " We will crush you," " You will lose what little you have got left." ' " Then the compensation you got was $300 and the pleasure of selling out your friends ?" Albert was asked by one of the great lawyers.^ Albert did not smile, but " they seemed to enjoy hugely," reported the press, " the idea that men could be bought so cheap." The eminent counsel of the prisoners took the cue from their clients, and treated the proceedings as a farce. When the State's Attorney was questioning his witnesses, they objected to his questions with laughs and sneers until he became indignant, and asked, with consider- able emphasis, to have the joke explained to him — a need the jury also felt, as their verdict showed. When the Eoston agent of the trust told that his instructions from headquar- ters were that if there was to be any selling at a loss to let the new competitor have the loss,° they all laughed again. So all the morning there had been fine sport in the court- room, and the good-humor had risen higher with every fresh incident in the entertainment until Albert's wife took her place in the witness-box. She, too, raised a laugh, but it was not she who laughed. Serious enough she was when taking her place on the witness-stand. Slie had to face these gentlemen, before whose hundreds of millions her husband's little venture had withered, but, as she herself afterwards said : " I wasn't afraid of them, but I was nervous. But as soon as I got talking I didn't care anything for them, although they all sat there in front, in a row, looking straight at me." The wife's story to the jury showed how such an adventure 1 Trusts, Congress, 1888, pp. 814-15. « Same, p. 834. ' Same, p. 847. 262 TEROUOH THE WOMAN'S EYES appeared when looked at and experienced from the woman's stand-point — the home-maker's and tlie home-keeper's — which the smiling row before her were as little able to grasp as the participants in a pigeon -shooting match to look upon that vision of flames, demons, and death-dealing thunder from the point of view of the hapless birds. A bright-faced, brown- eyed, pleasant-looking woman, as she took the stand she looked what she was — an artisan's honest wife. " My husband," she said, "had been employed in the Yacuum oil works at Roches- ter thirteen or fourteen years, and we had accumulated some property — mortgages and money and real estate. We moved to Buffalo, April 5, 1881, where he was superintending the building of the Buffalo works." ' After Albert had yielded to the threats and the temptation, and had fixed the stills and the fires for an explosion, he fled without a woi"d to his wife or his associates, hid, under an assumed name, in Boston, and then travelled over the continent for a year — from Baffialo to Boston, to Eochester, to San Francisco. "When yon left Buffalo did you leave any word with Matthews where you were going ?" " No, sir." ." Or your wife ?" " No, sir." While the wife was in Buffalo wondering what had become of her husband, he was in New Tork with his venerable ex- eniployer, getting lessons like the following in the secrets of building up a great commercial enterprise: " The best thing you can do, Albert," said the latter, " is to go and write a telegram, and tell your wife to go back to Kochester." " You'd better write it ; I am a poor writer," said Albert. " No," he said ; " I do not want to appear in this case at all. Write it so," he continued, " that she can move on the Fourth of July, and they can't attach her things." " Tlie first word she got from her husband was this telegram 'Trusts, Congress, 18SS, p. 842. '^ Testimony, Trusts, Congress, 1888, p. 82 i. TAKING GOOD CARE OF HI3I 263 to move between two days, and back to Eochester the dutiful woman packed herself and her things. " It was two or three weeks before I heard from him direct or knew just where he was," she said. "I asked Charles" — one of the two managers — "how Al was, and he said Al was all right." " Would he tell you where he was ?" the State's Attorney asked. "No, sir; when I wrote to my husband I left the direction blank, and gave the letter to Charley. I got an answer through Charley." ' For three weeks they would not let her know where her husband was. " Think of that," said the District Attorney. " She had to go and take her poor little letter to her husband, thinking, perhaps, if he was away from her tender care he might get to drinking, because he does drink some ; but when with his wife they lived year in and year out without his tast- ing a drop ; . . . afraid that he might get to drinking, and that she could not watch over him. ... It was a cruel thing to do." " C. told me to go to the real-estate agents," Albert's wife continued, "and try to sell our property and get it into money. He made out a list of real-estate agents from the city directory. I guess that is all he did about assisting me in the sale of the property." " I asked C. if my husband could not come home from Bos- ton. I was sick. He said ' Yes.' Al came home and stayed a week or two. Then lie went back to Boston. C. told me they did not want the Buffalo company to know where Al was." = Albert was a man infirm under temptation. The employer knew, by fourteen years' acquaintance, the weakness this man had acquired in his service in the army. He gave him idleness, money, temptation, and an assumed name to go to the devil with, if that agent of the trust was to be found in Boston. " You want to take good care of Al," said the good old man > Testimony, Trusts, Congress, 1SS8, pp. 842-43. ^ Same, pp. 843-44. 264 THROUGH THE WOMAN'S EYES to his clerk in Boston, " and not let liim get homesick. If he wants any money, let him have it." Albert travelled the broad way made smooth for him. " Of course I never went around with him," said the clerk, in a deposition ; " a porter that I had was the party that went around with him in the evening. I would hear what was going on, and I could judge about the size of Al's head when he came around in the morning." With all Albert's faults he kept one dignity to the end which makes him tower above his seducers — the dignity of the laborer. A life's discipline in daily toil had made his whole fibre too honest to enjoy idleness, even at the rate of §1500 a year. He was free to come and go amid the gaudy joj's of a great city, as irresponsible under the assumed name given him as if he wore the ring of Gyges. He had money for the asking, and boon companions. But the habit of a lifetime of honest, hard manual work was too deeply ingrained into the very substance of liis nature for him to become a cheap American Faust, revelling in a pinchbeck paradise. This sim- ple son of poverty had all his life handled only real things, and had at every point had the mind's native wantonness and riot checked by the hard sui-face which had calloused his hands, and the outer air which had cooled him as he worked. His were dreams of honest rest earned by honest work, and of family joys. The self-indulgence that was revealed by the "size of his head in the raoi-ning" was an animal exuberance that, as the result showed, did but stain the "rose-mesh of his flesli," and went no deeper. Albert could not stand the idle- ness of his Boston life. He went back to Kochester. "I want something to do." " What brings you here ?" said his employer. " Go back." After hanging around the office in Boston a few weeks longer, the workman's nature reasserted itself again. He went back again to Eochester. "I want something to do." "We have not got anything for you to do just now," he was told. " You are all right." ' 1 Trust?, Congress, 1S88, p. 823. "7 WANT SOMETEINO TO DO" 265 Months of idleness were interrupted only by odd jobs, like superintending the digging of a ditch or the sinking of a salt- well. Time and again, though he was drawing his pay of $125 a month, he went, as he told the story in court, to repeat the plea for "something to do." Finally, the elder of the managers, who was in California, sent for him. He was to be made "an independent man," the new promise ran, but really, as the sequel showed, was, if possible, to be kept out of the way of too inquisitive juries and prosecuting attorneys. The wife, treated as a mere pawn in the game, protested vehe- mently. " I went down to the Vacuum Oil Company's oiSce, and asked C. to give Al something else to do. I didn't want him to go to California. He said that there was not anything that he knew that he could do." " I don't want Al to go. I won't go. Give him something else to do." " I have nothing else." ' She had to yield, and her husband left her to go to Cali- fornia. His employer persuaded Albert to bu}' a piece of land in California. " He seemed to be very anxious to locate me there." ^ Albert sent to his wife for the money, but the shrewd little woman sent onl}' half. " I thought I would let him pay it out of his pay." With the same good sense the wife had not sold all the property when sent out alone among the real-estate men. " I did not sell the real estate," she said ; " I thought there was too much expense." ^ She was not with her husband when the rupture came in California. The first news the anxious wife had of a change in her husband's affairs was when " Charley " came to her, as she was sitting one summer evening on the porch of a neighbor's house, and told her " Al " had quit them. " I do not know what to make of it," he continued ; " I think he must be crazy or some- thing." * It was not until his return that she learned the details of the painful experience he had been through. When it was I Trusts, Congress, 18S8, p. 8i4. = Same, p. 825. 'Same, p. 845. ■* Same, p. 844. 266 through: the WOMAN'S ETES heard that Albert, upon his return from California, had made restitution as far as he was able, by telling what he knew to the authorities, to aid them in bringing the principals in the crime to justice, there was consternation in the trust. One of its detectives had been captain of the company Albert was in during the Civil War. The captain now presented himself before Albert as he went to his work in Corry, Pennsylvania, where he had gone after his return from California, and be- came sociable rapidly. He had great plans for Albert, and came to the house to discuss them confidentially. Albert and his wife had been simple folks to start with, but they had learned a thing or two by this time. The captain's desire for confidential talk with his old comrade was so intense that it would have been rude in Albert's wife to thwart it. She packed off her daughter on an errand, and announced that she had a call up the street, and would leave them to themselves ; but she did not add, as she might have done, that during her absence she would be represented by the Chief of Police, whose appetite for confidential communications was as keen as the captain's, but whose retiring disposition kept him in the dark seclusion of an adjoining room, with his ear to the crack of the door. "Wouldn't Albert like to go to Russia?" the captain asked his dear friend the private, whose existence he had never per- sonally recognized when they were so close together during the Civil War. " If the Court will allow me to show by this witness," said the prosecuting attorney, " that the captain came there as a detective for the oil trust, and made a propo- sition, after the indictments were found, to Albert to :§ee the country, and go with him to Russia." One of the army of trust lawyers was instantly on his feet with " I object." The judge sustained him, and the testimony was shut out. Albert's wife kept close to his side, and held him steady. No, Albert did not care to go to Russia. Advertisements of an alum-mine in Corrj' then began to appear in newspapers where Albert's attention could be called to them. By a lucky chance the captain happened to know the capitalists whose DRUNK BT ADVICE OF COUNSEL 267 boundless powers of enterprise could find full outlet only by developing the hitherto unsuspected resources of Corry for supplying the nations of the earth with alum. By a joyful coincidence, these capitalists wanted for superintendent of their bottomless alum-mines just such a man as the captain knew his dear Albert to be. Would Albert like to go to Italy to learn the true science of alum manufacture, and to show the efEete monarchies how an American could disembowel the earth of its alum ? Salary, $5000 and expenses. No, Albert had no unslaked ambition to go to Italy as superintendent of mines of alum, or green cheese, or any other lunar com- modity. At least, Albert would take a drink? That poor Albert would do; and when he failed to come home at night his wife went up and down the streets seeking him. "A persistent effort had been made " by the trust, Mr. Matthews testified, " to get Albert out of the country. I was afraid they would get him away, as he might not be used in this case. Men had been sent thei-e to get him drunk, and had debauched him." ' Money was potent enough to persuade lawyei-s to make it a part of their professional duty to help in this. One of the trust's lawyers sat with Albert and its detective in the stall of a cheap saloon, and plied him with liquor to get from him some letters of Matthews' they wanted. " There they sat," said the keeper of the saloon ; "- . . they got what they called for, probably. ... I couldn't tell how many drinks they got into Albert on that occasion ; I think they drank there." " While this courtship was in progress witli Albert in Penn- sylvania, wires were being pulled to get him indicted in !New York. The grand-jury of Rochester was asked to indict him for receiving stolen property in a watch trade he had made seven years before. This would have ruined him as a witness in the forthcoming ci'iminal case against the members of the oil trust, but the grand -jury decided that there was no evi- ' Court Stenographer's Report, p. 2049. The last statement is omitted in the transcript furnished by the trust for the Congress Trust Report of 1888. = Testimony, Trusts, Congress, 1888, p. 911. 268 TBROVOH THE WOJTAN'S EYES dence on which to indict. When Adam Cleber, a stolid-look- ing German laborer, who worked in the same place with Albert in Corry, took the stand for the State at the close, an eager excitement filled the court-room. The State's Attorney was known to have his darkest sensation still in reserve. What it was he would not, of course, disclose in advance, but those hardly less familiar than he with the evidence hinted that the fertile genius of the captain, having exhausted itself in the ideas of the trips to Russia and Italy, had fallen back upon the genius of his superiors, and had arranged to have Albert go a-hunting, and get a "bust-up" as much as possible like the one he had been induced to attempt upon his employers and partners. '•' Did the captain tell you what he wanted you to do to Albert?" Gleber was asked. " Yes — " That was as far as Cleber got. " I object !" screamed one of the lawyers. " I propose to show that the captain made a request of this witness in regard to what he should do to Albert, and what he should come and swear to about Albert, there being no truth in the matter he wanted Cleber to swear to," the State's Attorney urged to the Court. The judge took the matter home for consideration over -night, and announced in the morning that he would not admit the evidence. It was ac- knowledged by one of the lawyers for the members of the trust on trial that he had employed the captain to get evi- dence for them ; but the judge, instead of admitting Cleber's testimony, and leaving the question of its value to be settled by the jury, excluded it. In his closing speech District Attorney Quinby said : " Why, in Heaven's name, my friends, didn't you place the captain on this witness-stand ? He would have been a feast for you and a feast for me. His ways have been curious and sinuous, his methods have been peculiar and corruptino-, and they did not dare to put him on the stand because if they did he would have left it to go to prison. That is the reason. They know it." BARDLY A MOUTHFUL FOB THE TRUST 269 The brave and steadfast woman told lier part of this story on the witness-stand. Her home liad been broken up again and again. As she herself said afterwards : " I had to live with my carpets packed, and moved around like a gypsy." Her husband had been tempted to commit a crime which compelled him to lead the life of a fugitive. He had been spirited away and secreted ; she had not been allowed to know where he was, and could communicate with him only through a third person ; they had moved around, in her ex- pressive phrase, until they had moved into two rooms ; the savings of fifteen years' hard work were all gone, and the in- dependent business, in which her husband had just got his footing, swept away. He and she faced the world with no other assets than their child and the palms of their hard- working hands. "Well, it's taken all we had," she says ; " we've lost it all, but I'd rather it would be so than to have the money they have, and go about hiding and sneaking. I'd like money, but not so well as that. When I said to ' Charley,' ' I shall have to sell all my furniture ' — ' Oh, that's nothing.' And when I told him it had cost us $100 to pay the expenses of selling real estate — 'That isn't much.' It wasn't much to them, but it was to us, who had made every dollar by hard work. Well, we'll have to do without the money, and just live along by honest work. We can live that way. We have had all this trouble and lost our money, and haven't made money enough to buy a calico dress." All the good that had come of this loss of savings and home and honor had gone to those at the bar of justice and their associates sitting in the tickled row before her. On the cross-examination, which was to crush the witness and her damaging testimony, the distinguished counsel, not content with all the suffering and loss already inflicted on this wife, tried to humiliate her still further, but the woman's wit of truth was too much for the lawyer's wit of wile. "Don't you recollect," the lawyer asked, " that you went to the house of the manager of the Vacuum, and that you 270 THROUOR THE WOMAN'S EYES saw him in the parlor, and that you asked him to take your husband back? " I never asked him to take my husband back." " Then you did not ask Jiim at the time and jjlace I spoke of?" " I never asked him anywhere to take him back." " Don't you recollect xipon that occasion being considerably affected, and asking him to take your husband back, and his speaking of the way in which he had left the company, which he characterized as shameful, and that yon cried — shed tears ?" "I never asked him to take him back. I recollect going there. I recollect I felt bad, because I was talked to so much about it. I had reason to feel bad. I am trying to tell the truth as near as I can." " Then what was the occasion of your bad feeling?" " It was because I thought we were going to lose every- thing, and would not have nothing left. That is what I felt bad for — was shedding tears for, if I did. I don't know as I did." ' Then came the laugh. From millionaire to lesser million- aire went the enlarging laugh. The mighty cortege of the retained ex-judges, famous constitutional and criminal lawyers, detectives, camp-followers laughed. It was the laugh of hun- dreds of millions, and it clinked and tinkled and rang. As if every mouth were a bagful of gold, and as if every bag had burst, the golden notes of mirth filled the air, and struck the ceiling, and rolled over the floor, rebounded and fell and rose in mellow chimes of sound, and the golden rain dripped everywhei'e. Millions on millions, tens of millions, hundreds of millions of the coin of the republic, and in every coin a cackle. " Yes, they all laughed at me," the little woman told her friends ; " it looked like such a great joke to them. Perhaps I did not tell it very well, but I told the truth." In closing the case the State's Attorney said to the jury : ' Court Stenographer's Report, pp. 454-55. THE LAUOH 271 " A sorrow was placed on that woman's heart tliat can never be removed. One of the pathetic things in this case was that when this woman was on the stand, telling her little story, how they were afraid they might lose the few thousand dollars they had saved, the $6000 or $7000 they had been struggling for for fifteen years, these New York gentlemen with their mill- ions laughed in her face at the idea of her being sorry to lose the pittance of $6000 or $7000. It was the only time in the case, really, I felt that these gentlemen were outraging com- mon decency." ' Some time after the trial was over, and sentence passed and satisfied, these men sent for Albert to come to Kochester. He went with witnesses. There in the office of a leading lawyer he was tempted Avitli desperate propositions to do something or say something that would break the force with which these disclosures must act on public opinion. "They need not think," he replied, "that they can get me to make a false oath to let them out of a hole. I would not do it for all the com- bined wealth of the trust. When my wife was on the stand they laughed her in the face when she told about losing all we had. Do you suiDpose any man with a particle of American blood could have any love for them ? I think as much of my wife and daughter as any of them of theirs, and I will do nothing to disgrace them." This hard-working and hard-liv- ing laborer and his wife had, by thirteen or fourteen years of toil and stinting, saved $6000. The laughers had in the same time saved about $300,000,000, and somebody else had done all the work. The poor man and his wife had been afraid that the $300,000,000 would devour the $6000. It said it would, and it had. Shall not they laugh who win ? ' Ourt Stenographer's Report, p. 2164. CHAPTER XX TAKEIT FEOM THE JUET BY THE JUDGE The District Attorney put the president of the light of the world on the stand. His evidence showed that the pur- chase of the three-quarter's interest in the Vacuum Company, sold because "there were restrictions in the sliipments," was made by the three New York men on trial. " They are share- holders in the trust," he said. When they bought the stock they transferred it to the oil trust. He had known of the contemplated purchase. Having thus proved that the three indicted directors from New York on trial were members of the oil trust, and were managing the Yacnum for it, the Dis- trict Attorney proceeded, in pursuance of a logical plan of inquiry', to bring before the jury what the trust was, and its relations to the companies it covered. " What is it ... if yon know ?" the District Attorney asked. The president, through his counsel, objected to the question. "What is the object of this?" the judge asked the District Attorne}'. The trust, the District Attorney explained, owns a ma- jority of the stock of this Vacuum Company and others, and controls the manufacture in this country of substantially all the lubricating and illuminating oils. These defendants belonging to the trust, and "one of these being chairman of a committee of the trust, it was the desire and motive of the three to do away with competition, to destroy and ruin the competitive works in Buffalo." The Court asked tlie president of the trust if it was a manufacturing company. " It is not, your honor." HULmOS OF TME JUDGE 273 The Conit ruled out the question "What is it?" although in doing so he used language apparently contradicting his ruling, saying, in effect, that it was " quite immaterial what the objects or purposes of the oil trust are, unless these defend- ants are in some vi&y interested so as to create a motive to do what it is claimed they did do." Again, when the District Attorney sought to ascertain in what other corporations en- gaged in the manufacture of oil in 1879, 1880, and 1881 the trustees on trial owned stock, it was objected to and the objection sustained, although the Court but a few moments before had said, "I will allow you to show everything these defendants have done upon the question of motive, ... to show what their business is, the companies they have stock in, whether it is an oil company or some other company — that is, any company engaged in the manufacture of oil that would come in competition with the Buffalo company. . . ." The judge, declaring that he would admit such evidence, refused to admit it. What the District Attornej' would have been able to uncover as to the responsibility of the " trustees" for what was done by the subordinate companies, the reader, freer than the jnry iu this case, can find out for himself. The nine trustees, of whom three were on trial, owned as their individual property more than half of this as of every establishment in tlie trust. They decided who were to.be elected directors and officers of each company. They exer- cised full control over these officers when elected. They declared the dividends. The profits of all these shares are put into one purse, and distributed in quarterly dividends among the trustees in proportion to their interest in the trust — the purse-holder.' In the case of the Vacunm Compan}', according!}', we find tliat the minutes of stockholders' meet- ings record the presence of luembers of the oil trnst, in person and by prox}', representing a majority of the stock, electing the officers and directors, and declaring the dividends. How ' TestimoDV, Rice cases, before Interstate Commerce Commission, 1S87, Nos. 51-60, p. 867. Testimony, Trusts, Xew Torlc Senate, 188S, pp. 571, 577, 578, 579, 658, Testimony, Trusts, Congress, 1888, p. 293. 18 274 TAKEN FROM TEE JUST BT TEE JUDGE thorongli and minute is the supervision over the vassal com- panies an employd, wlio had been in the service of tiie combi- nation for several years in a confidential v^&y, and "had access to every book and paper and their cipher arrangement," has told.' They " control every movement of every branch of their business." Tlie subordinate companies " make a report every day of all their business. . . . They Jiave blanks there on which they make a report of all their shipments, where shipped, and who shipped to, and all their purchases ; and they report every month the exact percentage they have made out of their crude oil, of all the different products they get out of it. They report everything in detail." This was in 1879. Ten years later, in 1888, the testimony of the president shows that the system is tlie same. " They know the cost at every refinery. They get such reports once in thirty days ; each report shows just what it has cost for everything. . . . Made out on regular blanks." ' But when put on tlie stand in this case, in Buffalo, he had professed himself altogether ignorant of any such reports.' Asked if the Vacuum Company had made tiiem, he replied : " I can't recall any such reports." Asked if it was obligatory upon the Vacuum Oil Company to make reports, he said : " I can't state." But the manager's testimony in the same case shows that the system of reports which his superior "could not recall" was in regular operation. " There are reports of sales of the Vacuum Oil Company made to certain parties in New York." ' The three trustees who bought the control of the Vacuum stock did not keep it for themselves. They transferred it to the. trust, and received for it shares in the trust. They were 1 Testimony, Alleged Discriminationa in Railroad Freights, Ohio House of Repre- sentatives, 1879, pp. 36-39. 'Testimony, Trusts, New Tork Senate, 1888, p. 410. ' Court Stenographer's Report. '■• Testimony, Trusts, Congress, 1888, p. 871. THE SEAL STOCKHOLDER 275 not stockholders in the Vacuum, but stockholders in the trust. It was the trust which was the real stockholder in the Vacuum. The profits on this Vacuum stock, therefore, went into the common fund in which the trust accumulated the profits of all its controlling ownerships in companies all over the coun- try — all over the world. Every trustee shared in the profits of every company so controlled, whether in the United States or Europe or Asia. The president of the trust, now on the witness-stand, was a large participator in the profits of the Vacuum, because he was a large owner in the trust which possessed three-quarters of it. Similarly as to the three trus- tees indicted and on trial, and every other trustee.' The case was interwoven, notwithstanding the exclusion of this by the judge, with evidence that the thi"ee members of the trust on trial were the managers of the company for the trust, and were consulted habitually about the current details by the sal- aried agents. "After this purchase was made did yoii continue to repre- sent the purchasers in the management of the affairs of the Vacuum Oil Company?" one of the three was asked. "I did." After the purchase of the Vacuum by the trust, Mr. Mat- thews, before he left to go into business on his own account, had to go to its office in New York half a dozen times, to see the New York directors when he wanted instructions. His testimony on this point covers thirty pages of the official tes- timony, and shows repeated interviews between him and the members of the trust about every kind of detail of tlie busi- ness of the Vacuum. "When Matthews asked the manager of the Vacuum to give him more pay, the latter had told him to speak to one of the trustees — one of the tliree now on trial. " It will be as he, says about it." Again, as to another matter, lie said to Matthews: "I cannot tell you. There is no use for me to pretend that we run our business, for we do not." " This evidence must be sought in the original records of the • Trusts, New York Senate, 188S, pp. 456, 571. ' Court Stenographer's Report, p. 892. 276 TAKEN FROM THE JURY BY THE JUDGE case at Buffalo, as it is left out in the transcript furnished by the trust to the committee of Congress, which represents the case against the two local managers only. The Kochester manager, after the explosion, and at the time of sending for Albert to come to New York, telegraphed to his son : " Our views with regard to Albert confirmed." By whom ? as Mat- thews' lawyer asked. The manager saw one of the three ac- cused trustees in New York after he returned from the trip to Boston to hide Albert. "I told him that I had hired him," he testified. The trustee denied this, as the president denied the month- ly reports. But he has himself furnished the evidence that his employ^ told the truth. In tlieir answer in court to the allegations of the suit against them for damages, he and the other two trustees concerned in the Vacuum direction testi- fied tliat they advised the Kochester managers " to endeavor to retain the said" Albert, . . . "and after" he "had left the employment of the Yacuum Oil Company . . . tliey further advised that he should be re-emploj'cd if it could be done by reasonable increase of his wages. They were afterwards in- formed that he had been re -em ployed." This shows they knew about the negotiations before, during, and after. They knew the man was to have more wages, though the increase was only §300 a year, and their income was millions yearly. AVlien he had been gotten away they were informed of that too. The District Attorney knew all about this answer in the civil case, but under the statutes of New York it could not be nsed in a criminal prosecution against those who had made it. He put the trustee on the stand, and did his best to get him to tell the same storj', but in vain. The body-guard of lawyers surrounding the great men who made the court-room a veritable cnriosity-shop for the people of Buffalo, did a deal of acting throughout the trial to impress on the jury that the whole proceeding was a farce. They laughed and yawned and pooh-poohed, and sneered at the District Attorney's questions and points, and went throuo-h all kinds of dumb-shows of indignation and ennui that their HESCUE OF THE TRUSTEES 211 clients should be so needlessly called on to waste priceless time. But this could not prevent their faces from lengthen- ing as the story was told by witness after witness, as more than one observant reporter saw and noted. When the evi- dence was all in, and District Attorney Quinby had closed his case, the situation was desperate. There was no doubt about that. The great men of the trust on trial liad been proved to be the actual directors of the Vacuum at every turn of its daily afEairs. Before any evidence was introduced for the de- fence, one of the distinguished lawyers arose and moved the discharge of the three members of the trust, who were a ma- jority of the Board of Directors of the Yacuum Companj^, and managed it for the trust. The prosecution were not taken unawares by the motion. The District Attorney's able assistant, William L. Marcy, had gathered all the precedents and equipped himself to resist the discharge. He and the District Attorney fought hard to have the principals in the company go to the jury with their agents, but in vain. Mr. Marcy pointed out that, as shown in the case of The People vs. Mather, " to charge partners as conspirators it is not neces- sary even to show that they were the original conspirators. It is sufficient if at a subsequent time they become party to it by accepting the benefits derived from the conspiracy. The case lays that down in exact terms." The Judge: "Must there not be an adoption?" Mr. Marcy : " That is an adoption — accepting the benefits." The Judge : " They ma}' accept the benefits without know- ing." Mr. Marcy : " Then tlie jury may infer that knowledge from all the circumstances. The jury are the tribunal to determine whether or not the parties had the knowledge." Mr. Marcy pointed out that there was everything to lead the jury to infer that these men were parties to the plan. "Where did tlie meetings of the Board of Directors take place ? At Rochester, wliere the works are ? jSi'o ; at New York, where these men carried on their other business. The Eochester representa- tives dance in attendance wherever these New York parties 278 TAKEN FROM THE JURY BY THE JUDGE desire them to go." He pointed out to the judge that tlie trustee whom Albert met in New York after the explosion knew of the plan to take him to Boston. He showed that the same trustee, when remonstrated with by Matthews for bringing patent suits without foundation, said that he in- tended to carry them on, and if he was beaten in one court, he would carry them to a higher court. Just in the same way tiie Rochester representative of the trust had said : " I will bring lawsuits against you. I will get an injunction against you." " When the Kochester manager," said Mr. Marcy, " hired Albert, he did not pretend to be able to make a bargain until he had been to New York and consulted about it. He was in New York before he telegraphed to him to come to New York. This significant fact points home the conspiracy upon the gentlemen who reside in New York." But the judge, and not the jury, rendered the verdict as to the three members of the trust on trial. He failed to re- member or observe the law that leaves it to the jury to render the verdict. He announced that he had decided to grant the motion for their discharge. There was silence in the court- room for a moment. Then: "Gentlemen of the jury, hearken to j'our verdict as advised by the Court," came in sonorous tones from tlie clerk ; " you find the defendants " — naming the three members of the oil trust at the bar — "not guilty of the crime, as charged in the indictment, so say you all." The jury looked scared at being addressed so peremptorily, but said nothing. " The New York men looked happy," said one of the observ- ers, " but their Rochester associates and codefendants did not smile" Upon the discharge of the trustees, one of tlie Buffalo dailies said that whether there was any conspiracy at all is an undecided question, but it should be remembered that the oil trust and tlie Vacuum Oil Company " have been honorably ac- quitted of the charge of having anything to do with the mat- ter. As the case now stands, it is simply The People against" — tlie two Rochester managers. Poor men ! It was for this that they succumbed to the HIS SENSE OF HUMOR 279 attacks of the oil trustees upon their business, sold them for $200,000 three-quarters of a concern whicli produced $300,- 000 in dividends in one jearfor the hicky conquerors, became vassals instead of masters in their own refinery. It was for $10,000 a year, divided into $6500 for one and"$3500 for the other, that they undertook to fetch and carry for their suze- rains, even to the gates of the penitentiary ; and when dis- covery and conviction came, to bear in silence upon their own shoulders the guilt and shame from which others got only " more." The trial of the two remaining defendants proceeded. Neither of them took the stand. In a deposition tlie elder said it was Albert who had spoken about misplacing the pipes ; but when asked what he said in reply to a suggestion, which no one better than he knew the significance of, he re- plied : " I made no reply to it, but I thought it would be a very scandalous proceeding." ' Albert had told how, in con- versation in California, his employer had described his plans with regard to Matthews. " We would have just got them fellows in a boat, right in the middle of the stream, and we would have tipped them two over, and drowned them, and you would have been all right." ' " If I ever made such a remark," this defendant de- posed, "it was in a playful humor. I am in the habit of mak- ing playful remarks." Witness after witness had to confess, under cross-examina- tion, that his testimonj' had been written and rewritten by himself or the lawyer for the defence, and carefully conned before coming on the stand. The District Attorney asked one of these tutored witnesses why he had read over the wi-itten preparation of his testimony in the rotunda of the court-house just before going on the stand. " I read it over," he replied, lucidly, " for the simple reason of reading it over." "Just to practise in reading?" ' Testimony, Trusts, Congress, 1888, p. 869. « game, p. 826. 280 TAKEN FROM THE JUHY BY TEE JITDQE '"' Well, perhaps we might call it practice in reading." ' " This preparation of the testimony," said the District Attorney to the jury, " which I stigmatize as infamous, this going to a witness and writing him down, and having him fix it, and write it over again, and keeping it in his mind, and reading it over, and so going on the stand, is not the way to try a lawsuit, in my mind. I write nothing down. I coacli no witnesses. I want a witness to tell me his story. I put him on the stand and he tells me his story; but no writing down, no reading over. It is not right, and it is very liable to be very wrong." Several witnesses were introduced to prove that Matthews had offered to settle the criminal prosecution. He could not have done so had he wished to. The criminal case was in the hands of tlie State. Of the witnesses who made this charge against Matthews, one was a stockholder in the trust, another had been a stockholder in one of its pipe lines, and both had to admit on cross-examination that the occa- sion of his alleged agreeing to settle the case had been that they had gone to him for their friends, unsolicited by him and unexpected, to find out at what price he would sell his works to the combination. " I was anxious to settle the crimi- nal prosecution," said one of these ambassadors. " Anxious for whom ?" asked the jerper-ready District At- torne}'. '•I should say — nobody," replied the witness, in confusion. "Mr. Matthews told him," said Mr. Hiram Benedict, one of the best-known citizens of Lockport, who was present, "that if they bought the capital stock of the company they could do what they chose with the civil suits, but with the criminal suit he had nothing to do; the people had that in charge."'' The lawyers tried to make a jest of the whole proceeding, and affected to look upon the incidents of tliis rivalry with their powerful client as sometliing too trivial to be noticed. '• Is it a trivial matter," asked District Attorney Quinby, " that ' Testimony, Trusts, Congress, 1888, p. 902. =Same, pp. 905-41. FOUR JURIES HAVE AGREED 281 it shall be decided, once for all, in a court of justice, that in an alleged republic you and I shall not start a business which is arival to some one else? That is the issne here, and yet the lawyers for the accused tell us it is trivial. It is the most im- portant question that was ever left to a jury of twelve men in this or any country in this age of monopoly." The jury thought so too. The meaning of the policy of suppressing competition was skilfully described by Judge Edward Hatch, Mr. Matthews' counsel in the civil suit for damages, and here again the jurj", representing the people, thought so too. " Wiien a man or a corporation is in a position to control the market as to a given article, then everybody is within their power, and it rests with their conscience to determine what shall be the price. Every time you farmers at home, or j'ouv wives or daughters, take your oil-can, turn it up, fill your lamp, and then sit do\v!i to read by it, you can understand what is meant by this proposition to crush these men out. ... It was a matter that not only these tliree men were interested in, but every person that lived in the community'. Competition would run along to a point where you could get the oils that you use in your families, to grease your wagons, and to burn in your houses, or for any other purpose, at a price that should give the manufacturer a fair profit, and at the lowest possible price. On the other liand, if you leave that open to these parties to regulate as they saw tit, having a monopoly of the market, then you rest upon the conscience of a corporation and put your faith in a soulless individual." It is one of the few bright lines in this picture that when- ever the people got a chance to make themselves heard, their utterance was always right and true. The four juries which passed upon the facts understood them, and had the moral standard by which to judge them aright. One of the trust's employes was put on the stand to break the eflEect of the evidence that the competition of the new works had put down the price of oil. "In the early part of 1881 — the winter of 18S1" — he said, "common oil was 5^ cents a gallon" — this to pi'ove that the reduction had pre- 282 TAKEN FMOM THE JUMT BY THE JUDGE ceded the appearance of the new refinery. He was con- fronted by the District Attorney with one of his own bills of oil sold in February, 1881. "That would seem to be a sale of 120 degrees oil at 12 cents a gallon," he confessed, and added, awkwardly, " I was asked as to the winter of 1881. That is not tiie winter of 1881 as I understand. I meant to speak from Jul}-^, 1881, and so on." ' The great lawyers held up to the ridicule of the jiirj' the idea that the gases of distilling petroleum were dangerous. Matthews stated on the stand that he had seen this gas burn up derricks, property, and several men. The lawyers could not let anything so absurd go unchallenged. " Did it explode ?" he was asked smartly. « Yes, sir." " And how did the ' explosion ' burn up the men and prop- erty ?" with a knowing look to the jury. " The gases crept quietly to the boilers, unobserved," said the witness, " and all at once the whole atmosphere was ablaze." The witnesses who tried to prove that no harm could have resulted from the tampering with the still broke down. One of them was the inspector of oils at the combination's refinery at Cleveland. He, too, had once been an independent refiner, but had passed under the yoke. He declared with every pos- sible variation of phrase that there could not have been an ex- plosion at the BufiEalo works; but the District Attorne}' got out of him piecemeal admissions that the " escaping petrole- um gases would be inflammable"; that "in a damp day you would expect them to settle close to the still"; that then, if they came in contact with fire, " you would have a large flash, and consume those vapors; if a person was in the vicinity he would burn." "I ask you if it would be a safe thing to fill a still with 175 barrels of petroleum, put under it an extremely hot fire, so that the front portion of the still is a cherry red, and a weighted safety-valve is blown off — would you consider that a safe thing to do ?" ' Testimony, Trusts, Congress, 188S, p. 939. FREE FROM THAT ANXIETT 283 " I would not." Still another of these witnesses ended, like Balaam, by say- ing just the opposite of what had been wanted of him. He testified that the escape of gases from the stills, and even their ignition, was a matter of no consequence — "it may occur at any time" — until he was cross-examined. It turned out then that his own works had been burned three times by the gases from distillation taking fire. " These gases," he had to admit, " took fire and burned the receiving-house. A man got burned up with it." "Are you willing," the District Attorney asked, sarcastical- ly' " to go down to tlie Buffalo works and have them run some vapor, on a quiet day, on the ground, and let you stand in the middle of it and touch it off?" " I am not anxious to do that."' Every one looked to see Matthews crushed by the cross-ex- amination, in accordance with the widely advertised promises of the counsel on the other side. "As he stood up to take the oath," said the New York World, " and confronted the men with whom he had been at sword's-point for six years, men of unlimited wealth and al- most unlimited influence, and controlling the most gigantic monopoly of any age or any country, Charles B. Mattliews looked, as a good observer said, what he proved himself to be, a fighter, who will never know when he is whipped. Hard knocks and a struggle of j'ears against an all-powerful enemy have whitened his hair, and set firm, hard lines about his face. His eyes are deep-set under a protruding forehead and black, bushy lashes, and are dark, firm, and searching. His jet-black beard is luxuriant but coarse, his whole head and face bespeak the dogged persistence in following a foe that is characteris- tic of the man. He is tall, well built, and with those whom he knows to be friends he is kindly and almost jovial in his manner." He told his story, and the jury believed it. One of the most damaging portions of his testimony was that 'Testimony, Trusts, Congress, 1888, pp. 932-33, 937. 284 TAKEN FROM THE JURY BY THE JUDGE given to connect the New York members of the trust with the conspiracy by showing that they had tlie actual, practical, continuous management of the Vacuum in matters small as well as large. Matthews, when in their employ, was kept running to ifew York continually to see one or the other of them about some detail of the business. Seeking to break down the force of this testimony, the big gun of the legal battery opened on liim. " But you did not see the name " of the oil combination " up over the office that you went into (in New York)?" " I do not tiiink I ever saw the name over the office that I went into. I think that name is not often in view over where the}' do business." *' What makes j'ou think so ?" " My experience and observation." " What experience and observation Iiave you had ?" '•' Do you want I should tell it all ?" "No, yon need not tell it all. We will let that go now." Matthews had been in their employ. He knew about the staff of lobbyists they keep to go from capital to capital as needed. For lack of evidence the jury was offered abuse of Mat- thews, spoken by the brilliant attorney on a shout which en- abled the populace outside the court-house to hear his speech, and, as the verdict proved, deafened the jury to his eloquence. The jury preferred the view given by the District Attorney. "When I look upon the troubled face of Matthews," said District Attorney Quinby in his closing of the case, "I know what is coming upon his head. When I know the struggle he has gone through, the integrity that is in his heart, I would say to him, ' AVell done, good and faithful servant, ^-ou have withstood the powerful arm of this insatiable corporation. You stand to-day honored from one end of this land to the other.' ... I am prond that in the count}' of Erie has been born a gentleman who has had the bravery and fortitude lie has shown." CHAPTER XXI CEIME CHEAPER THAN COMPETITION The jury was composed of nine farmers, one tailor, one store-keeper, and one railroad foreman. " So intelligent a jury," said the' 'BaSa\o JExpress, "is proof perfect that the verdict it returns is the only one warranted by the law and evi- dence." The jury found all the defendants guilty whom the court allowed them to trj'. The verdict, "Guilty as charged in the indictment," was given May 18, 1887. Every possi- bility of appeal and reversal was resorted to. The judge granted a stay, and this left the defendants uusentenced. A motion for a new trial postponed the day of fate until De- cember 24, 1887. When the judge decided against the new trial an appeal was taken, and was carried through every court except the highest. Legal procedure in New York makes the courts a hunting preserve for those who can afford the luxuries of litigation. The law was changed by the Field code so that demurrers and counter-appeals, proceedings and ancillary proceedings, on technical points can be carried, one after an- other, from court to court, while the real point at issue has to wait untried below for the results of this interminable con- test. By grace of this power to carry preliminary and tech- nical questions from court to court, at the pleasure of quib- bling and appealing lawj'ers and procrastinating judges, from courts of Oyer and Terminer to the Supreme Court at General Terra, to the Court of Appeals, rich corporations and indi- viduals are able to tire out altogether all ordinary opponents. It was only by help of very able and highly paid lawyers, ofBcers of the courts and of justice, that the law of New York 286 CHIME CHEAPER THAN COMPETITION was " reformed," so that the technical parts of a case could be to such an extent disengaged from tiie main body, and sent forward and backward, up and down, through the whole series of appeals, consuming endless time and money, while poor men seeking justice kick their heels in the lowest courts. As the time for pronouncing sentence came on, petitions for mercy were circulated in Buffalo and Rochester. The members of the jury which had found the accused guilty were labored with separately to sign a recantation. Only six suc- cumbed and signed a statement that the prisoners were found guilty, not because they had conspired to blow up their rival's refinery, but because they had enticed away Albert. This recantation was in the face of the judge's charge, which had made the plot to blow up the Buffalo works the chief and the important inquiry in this case, and the verdict had been given under the influence of this view of the case. Six of the jury saw the impropriety of making this statement after they had disbanded and passed from under the legal and moral re- straints they felt when sitting under their oath of ofiice, and refused to sign it. When the paper from the complaisant six jurors was handed in, the District Attorney said in court: "These jurors received money for making these affidavits. If re- quired to do so I will prove the statement." He was not called upon to do so. " These affidavits," he said afterwards, " were procured for the purpose of influencing the Court to administer the lighter punishment, since they tended to show that the verdict was directed against the lighter offence. One of the jurors told me he had been offered money to sign one of these affidavits, and he knew of one juror who had received §10 for signing one." When the last possibility in the way of proceedings for a stay or for a new trial had been exhausted, except argument of an appeal in the Court of Appeals, which was known to be useless, sentence was pronounced. The penalty provided in the statutes was imprisonment for one year in the peuiten- SALE OF INDULGENCES 287 tiarj, or a fine of $250, or both. Tlie lawyers pleaded that the elder of the convicted men was old, tliat tlie younger had just returned from a wedding tour in Europe, that some of the wealthiest and most prominent citizens of Rochester had petitioned for mercy, and that six of the jury had done like- wise. Each was sentenced to pay a fine of $250. Notice of appeal was given by the convicted, and a year was consumed on both sides in preparations to fight the case to a bitter finish. But the appeal was abandoned. A new trial and new sen- tence might have ended worse. The fine was paid, and these employes of the trust, upon whose record as reputable and inoffensive citizens for all the years of their business career no shadow had fallen till they entei-ed its employ, took there- by the place assigned them by the jury — that of convicts guilty of crime. Crime, it seems, may in this country be cheaper than com- petition. They who received the larger part of the benefit of the enticement of Albert, of the harassing litigation, of the damage done by the explosion, and of the bankruptcy which was finally produced by these means, went free of all punishment; and the employes found their crime but little less than a pastime. After his conviction, and before his sen- tence, one of the two married. His wedding was attended by many of the great men of the trust — magnates in the New York world of affairs and its affiliated interests. It glittered with gold and silver and precious stones which they sent to signify to the world that they stood sponsor for him. The case of some humble boycotters was then fresh in the public mind. Certain working-men, on strike, handed ai'ound printed circulars in the streets of New York, re- questing people not to buy beer sold by their employer. In a few weeks from the time they dropped those circulars in the streets they were in the penitentiary at Sing Sing. It was shown on their trial that tliey were entirely ignoi-ant of the fact that they were violating any of the laws of the State in what they did. It was shown on the trial of the oil men that they did know that the course they had in view was criminal, 288 CHIME CHEATER THAN COMPETITION and were warned by a lawyer it might land them in prison. "It was very fortunate," said the New York TFbrZ^Z, "that they were not poor men convicted of stealing a ham." One of the reasons given by the judge for his leniency Avas that prominent citizens of Buffalo and Kochester had begged for mercy. "With the very highest respect for the judge," said tlie Buffalo Express, " as the Express has often demon- strated, we must sa}' that this is a mighty queer excuse. Three-fourths of those citizens are in one way or another identified in interest with the oil trnst, as the judge could readily have ascertained, and their names on that petition were entitled to no more moral weight in the consideration of this case than the names of the two guilty men should have had if they had seen fit to sign it." The sentence raised a whirlwind of indignation. "As ridiculous as anything that could be imagined," said the Philadelphia Ledger. "It is high time," said the New Tork World, " that the lines were drawn between competition and conspiracy, between business and brigandage." Eeferring to the golden harvest of $300,000 dividends in one j'earon a cap- ital of $100,000, representing an original investment of only $13,500, the Wo7'ld said: " The monopoly of this sort of busi- ness is a very seductive thing. It is calculated to make men of more boldness than morals blow up factories, or do almost anything else to control the field." " It can afford to blow np a rival refinery every day in the year at that price," said the Erie Dispatch. "There have been conspiracies," said the Oil City Blizzard (Pa.), " to injure the business of opposi- tion concerns right hero in Oil City, and the conspirators liave never been punished." "It is — -a light sentence," was the comment of the Buffalo Commercial. "Poor criminals," the Buffalo Express declared, " ma}' well wonder why rich ones are let off so easily. It is equivalent to deciding that wealth ma}' securely indulge in that inexpensive sort of amusement as a mere pastime. Who's afraid?" it asked. "What con- spirator 'in restraint' of trade is afraid of a $250 fine?" " Certain it is that no wealthv criminals convicted of such a ITS SCAMLET LETTEB 289 crime ever before received from a court such a mockery of jus- tice," was the verdict of the Springfield (Mass.) Republican. The facts of this case have not been carelessly examined or decided. Two grand-juries in succession passed upon the ev- idence and found it good enough for indictments. Two petit juries heard the evidence, both for and against, in the civil and criminal suits, and found it good enough — one jury for $20,000 damages, another for a verdict of criminally guilty. Seventy picked citizens have unanimously concurred in the decision " Guilty." And this scarlet letter the monopoly will always have to carry. " So surely as Matthews lives, and so long as he lives," Dis- trict Attorney Qainby said in the criminal prosecution, " he will never again make another dollar upon a bai'rel of oil he may manufacture. The word has gone forth, right in this court-room, that this man shall be crushed, and he can never again run his works successfully. That is going to be one of the results of this case." The fulfilment of this prediction came swiftly. This sentence of ruin upon Matthews was exe- cuted before sentence was even pronounced upon the conspir- ators against him. He had been left crippled by the flight and corruption of his partner, the only practical oil man in the enter- prise. "When he tried to obtain some one to take his place, he could not get word of any one not connected with the oil com- bination. He did not dare to advertise, and knew no one in Buffalo he could venture to speak to. He had made contracts before opening the works, and was unable to fill them. The pipes had been laid wrong; it took him a year trying one way and another, and making a great many mistakes, to set them right. His third partner was frightened back into the employ of the oil combination by threatening litigation. Then came the suits to destroy, punctually as threatened.' "If one court does not sustain the patents, we will carry them up until you get enough of it," one of the trustees said to Mat- thews. One of the Kochester managers, in speaking of these ' Testimony, Trusts, Congress, 1888, p. 816. 19 290 CRIME CHEAPER THAN COMPETITION- suits, said : " I don't know as we will gain anything really, but we will embarrass them by bringing these suits, and, if it is necessary, we will bring them once a month ; yes, we -will bring them once a week." One, two, three, four, five suits came with injunctions. "Null and void " was the verdict of court after court on the worthless patents and pretended trade-marks on which he was sued. Matthews had to keep pushing his pursuers to trial. What they wanted Vv-as not decisions but delays, to ruin him by the waste of time and money.' " It cost me one-third of my time, and 825,000 or more to defend these suits." These suits were used to scare away his customers. " I was instructed," said the Boston representative of the combination, " to tell the customers that the Buffalo company were using their pat- ents." ^ The sole legal victory the combination won was the recovery of six cents damages on a technical point. Matthews, on his side, took to the courts. He sued his per- secutors as individuals and corporations. He pursued them civilly and criminally. He was successful in defending him- self against their suits. All his suits were successful as far as he was able to carry them. One suit for damages produced a $20,000 verdict; another was for $250,000, on the still stronger evidence procured in the criminal trial. It took Matthews two years — from 1883 to 1885 — to get his first case for damages for conspiracy to trial. All that time was consumed by his opponents in quibbles about procedure, technical objections, and motions for dela3', appealing them from court to court. The judge, in taking from the jury afterwards the three trus- tees who had been brought to trial for conspiracy, declared that he could see no reason to believe that these suits had been brought without probable cause. But the jury before which the suit for damages was tried saw plenty of such reasons, and gave Matthews' company a verdict of $20,000 damages. The views of the judge and jury might have varied in the same way on the question of the guilt of the three members of the trust. ' See chs. rsii. to xxvi. ' Testimony, Trust;, Congress, ISSS, p. 847. MEADT-MADE INJUNCTIONS 291 Matthews woke up one morning to discover, as he had been told he would, that there was no Atlas Company to get his oil from. Corporations may have no souls, but they can love each other. The Erie Railroad killed the pipe line of the At- las Company for the oil combination." The courts had been kept busy granting injunctions against it on the motion of the Erie. These were invariably dissolved by the courts, but an application for a new one would always follow. At one time the lawyers had fifteen injunctions all ready in their hands to be sued out, one after the other, as fast as needed. The pipe line was finally destroyed by force. Where it crossed under the Erie road in the bed of a stream grappling-irons were fastened to it, and with an immense hawser a locomotive guarded by two freight cars full of men pulled it to pieces. The Atlas line and refinery became the "property" of their enemy. Matthews' supply of crude oil was not cut ofE im- mediately*. He was tapered off. One of the superintendents of the Atlas testified in the suit for damages Matthews brought against the Atlas after it passed into the hands of the com- bination, that by the order of the manager of the refinery he mixed refuse oil with the crude which tliey sold to the Buffalo Lubricating Oil Company. Finally the supply was shut off altogether. Matthews turned to the railroads connecting Buffalo with the oil country. They all put up their rates. At the in- creased rates tliey would not bring him enough to keep him going; they would not give him cars enough, and told him they would not let liim put his own cars on the road. Even the lake steamers raised their rates against him. The farmer- refiner was taking his lesson in the course which had driven his first employer to dig oil-wells because " there were restric- tions in the shipments." Cut off from a supply by either pipe or rail at Buffalo, Matthews made an alliance with the Keystone Refinery in the oil regions. AVar was now made upon the Keystone. It was finally ruined. ' Testimony, Trusts, Congress, I88S, p. 421. 292 CRIME CHEATER THAN COMPETITION Packs of lawyers were set upon Matthews, and they finally brought him down. An attorney appeared before a judge and made a motion that the property of Matthews' company be taken out of Matthews' hands and be placed in the charge of a receiver, as oflBcer of the court, to secure a debt due a Buffalo bank. Tliis done, the lawyer appeared before the judge who afterwards decided that $250 fine was punishment enough for criminal conspiracy, with an offer from the monopoly to pay $17,300 for the discontinuance of the suits for damages which Matthews had instituted, and $63,700 for all the other assets. The other creditors and all the stockholders opposed the mo- tion, but the judge granted it. There were two suits. One had produced a verdict of §20,000, and the other one for $250,000 was brought on the new and much stronger evi- dence secured in the criminal trial. As to the value of the property, Matthews had brought his enterprise to the point where it was worth $20,000 a year. It was capable of pro- ducing many times that amount of profit. Had not Albert been enticed away, the new works would have yielded a profit of over $100,000 the first year. Tliey had a capacity of 70 to 80 barrels a day of lubricating oil, and the profit was $5 to $6 a barrel at the time Matthews and Albert went into the business.' The judge, overruling a majority of the creditors, ordered the receiver to accept the offer. He gave as his rea- son for selling these damage suits that a criminal prosecu- tion had already taken place for the same offences, and a per- son could not be punished twice for the same offence. As they had not yet been punished, this meant, if it meant any- tliing, that the suits were to be sold out for this inconsiderable sum, and the guilty men were to get their punishment in the sentence he was to pass upon them in the criminal court. Three months later, before the same judge, these convicted agents stood up to receive their criminal sentence. The judge gave them the lightest sentence in his power, " nominal pun- ishment." He did so, he was reported by the Buffalo press ■Testimony, Trusts, Congress, 1888, p. 849. THE VICTIM FUNISHED FIRST 293 to have said, because " it has come to the attention of the court that civil suits have been brought to recover damages sustained by reason of the same overt acts. Large punitive damages are demanded in those actions. It is fundamental that a person cannot be punished twice for the same offence." The judge released them from the suits for damages be- cause they were to be punished criminally. Then he released them from any but nominal punishment, because there had been suits for damages. One would infer that the civil suits for damages were in full career in the courts, to end possibly in hundreds of thousands of dollars' damages against the con- victed. No one would infer what was the truth — and who should have remembered it so well as the judge, for it was he who had done it ? — that the civil suits had been ordered sold. The judge had ordered his officer — the receiver — who had the luckless Matthews' affairs in his grip, not to try the cases, but to sell them. The suits had been ordered sold in February preceding, and they were as dead as — justice. But as all the technical formalities and slow proceedings needed to consum- mate the sale had not been completed when sentence was passed in May, the damages the}' might produce were made a reason for inflicting none but nominal punishment. The order of sale made it impossible that they should ever be tried. Of the money paid into court, nearly half — §30,000— went to the lawyers, and, crudest stroke of all, the attorney who had made the successful motion before the judge to take Matthews' property awa^', and to order the forced sale, got $5000. Matthews got nothing. Even his right to sue his de- stroyers had been sold to them on their own motion and at their own price. The crime was plotted in March, ISSl. The participants were indicted in 1886. It took until May 15, 1887, to secure conviction. While sentence was still unpronounced Mat- thews' property was put into the hands of a receiver of the court, January 16, 1888; the property was sold by order of the court, February 17, 1888 ; sentence was pronounced May 8, 1888; the formalities of the sale were consummated July 294 CRIME CHEATER THAN COMPETITION 11, 1888 : and tlie sentence, coming last of all — the fine of $250— was executed May 1, 1889. Matthews had tried to make money in oil, and had failed; bnt his competition had forced those in control of the mar- kets to increase the price to the producer, and he made light cheaper to the community. In Buffalo liis enterprise had caused the price to drop to 6 cents from 12 and 18 cents, in Boston ' to 8 cents from 20. Oil has never since been as high in Boston or Buffalo as before he challenged the moDopolj'. And he forced the struggle into the view of the public, and succeeded in putting on record in the archives of courts and legislatures and Congress a picture of the reali- ties of modern commerce certain to exercise a profound influ- ence in ripening the reform thought with which our air is charged into reform action. Nothing is so dramatic as fact, when yon can find the fact. The treatment his church gave the brother, who had been the victim, as judicially declared, of a criminal conspiracy, is de- scribed in the following letter from Matthews : " Buffalo, Jaiinary 19, ISSS. "3It dear Friend, — As your father was a clerg3TnaD, and as you feel an interest in church affiiirs, I think you will wish to know of my recent experiences. Sly church here is not a rich one, hut we pay as much for church music as we do as salary to our pastor. Probably the wealthiest man in our church is an agent of the oil trust. He receives a salary of §18,000 per year, and keeps their retail store here, and has been a witness for them in important suits. He does not belong to our church, but is a trustee and treasurer of the Church, and is very kind to our pastor, whom he took last summer on quite an extended vacation trip in New England. But you know the class of men that usually become trustees in our citj' churches these days. "ily pastor surprised me a few days ago by making a visit at my office, and telling me that as my term of office as member of the session expired soon, il might be best for me not to be a candidate for re-election, in view of what the newspapers had said about me, and the opposition there was. He said, however, that he personally felt friendly to me, and regarded me highly. He seemed to be embarrassed, but I quickly relieved the sit- uation by saying that I had told my family some months before that I should not again hold a church office. 1 told the doctor he well knew I ' TestimoDY, Trusts, Congress, 1888, p. 847. A VISIT FROM TME PASTOR 295 did not desire office in or out of the Cliurch. True, the newspapers, under tlie influence of the oil trust, had ridiculed mo as ' farmer Matthews from tlie country.' But why should my pastor mock me with such shallow pretences for reasons for church oijposition to me ? I bad engaged in the oil business without the consent of the oil monopoly, and my pastor then and there told me my friends thought me foolhardy in doing so. I could hardly suppress my feelings on hearing this said by tlie man who baptized my children and ministers at the church altar. What could all this mean ? I had only fought for my rights as an American citizen, as a manufacturer and shipper of oil. I bad been sustained in every detail by the courts. I bad convicted in our courts prominent men of conspiracy, little thinking that the subtle power of these men could come to dominate the Church itself. My feelings were intense, and words came thick and fast — all too tame to express my feelings. I told the doctor how I had struggled on from boyhood, and at middle age had accumulated a few thousand dol- lars, and in all these years had never sued a man or been sued, and that my struggle with the oil monopoly was for rights that no one worthy to be called a man dare to surrender. I told the doctor how I had been hounded, and my business beset by spies — that mj' friends had often told me I was in danger of assassination if I continued the fight in the courts. He, having done bis errand, seemed uneasy, and anxious to go. I told him I had seen the rising and corrupting power of this trust in their control of our aldermen and courts, in state and national legislation. I could witness all this with comparative composure; but it made every drop of my blood hot to see them erect their altars for Mammon worship in the Church of the living God. I had seen the hard-won earnings of a lifetime swept away, and had hoped that at least one word of sympathy might come from the Church. If. I had been robbed by old-fashioned highwaj'men and the Church received none of the loot, church sympathy would have been hearty and abundant. But no ; Sabbath after Sabbath our reverend doctor rises in the pulpit, and, at the regular time, says : 'Let us worship God in the gift of money.' Religion, divine worship, and money all seem to have a like meaning as they are alternately men- tioned in our pulpit. My ancestors far back were church people, but this worshipping money, or worshipping God with money, is all new to me. It was not the acceptable worship i-equired by Christ and taught by his disciples. After the conversation I had with my pastor that da3- 1 trudged home, but could not sleep that night. My heart was too full of sorrow as well as anger. I hope you will forgive me for writing you so long a let- ter. I have written much more than I intended to, but did not see where to stop. There are many things I wish you could see but not experience in the life of a business man nowadays. I want you to write often, as every word from a true friend is prized highly in these dark days for me." The action of the judge in this and another celebrated case Atas made an issue in the elections in JSTew York in 1S89. In 296 CRIME CHEATER THAN COMPETITION June, 1882, the railroads in New York Citj, rather than pay the freight -handlei-s the 20 cents an hour they asked for, instead of 17 cents, brought the business of the city to a stop. They refused to employ their old men at that price, and did not supply their places. Trucks b}' thousands, heavy with merchandise, stood before the railroad freight -houses for da3's, waiting in vain to be unloaded. The trade of the metropolis was paralyzed, and the railroad officials sat serene- ly in their offices, letting the jam pile np until the freight- handlers were starved into accepting the wages they -were offered, and commercial distress had made the business com- munity desperate enough to tolerate that injustice, or any other iniquity, provided the "Goddess of Getting-on" were allowed to get on again. It was so clear that the price asked by the men was fair, and that the refusal of the railroads to set them at work and keep the cliannels of trade open was due to a purpose to manufacture such widespread loss and trouble that the public should be goaded into f orgetfulness of the rights of the men, that public opinion forced the Attor- ney-General of the State to act. Ke-enforced b}- able counsel, he applied for a peremptory writ of mandamus to compel the roads to resume operations. This motion came before this Buffalo judge, then sitting by assignment in jSTew York. He kept the people waiting ten days, and then quashed and dis- missed the petition. The decision of the Supreme Court, composed of judges of both parties, reversing his action, was unanimous, but the mischief he had done was by that time — January 17, 1883 — long past mending. When he was nominated to be judge again, after his inde- cision and decision had swelled the dividends of the jrreat railways of ]^ew York, the presiding officer of the convention which was to choose him to be their candidate was, by a co- incidence, also the president of one of the great railway cor- porations which had been involved in the judicial proceeding of 1SS3. The judge's record was made one of the issues in the State election which followed the defeat of justice in Buffalo. He was nominated by the Eepublicans in 1889 for MOW JUDGES ABE MADE 297 Judge of the Court of Appeals, the highest court in the State of New York, and the nomination was asserted by the New York Times, in a leading editorial, to have been procured by the oil trust. Its " influence was active," said the Times, " in securing the nomination of " this judge. "... An attorney who has labored in its interests at Albany during the last two sessions of the Legislature was conspicuous among the men who did the work." The New York Times, the Buffalo Courier, the New York Star, the New York World, and other leading journals of tlie State retold the story of the trial, and declared that the judge's action in taking the case of the members of the trust from the jury, and the sentence he gave the convicted agents, made it clear that he was unfit to be a judge. The oil combination, the World said, editorially, "have had agents busy this year trying to secui-e his elevation to the highest court in the State. . . . We say confidently that the history of the case establishes his conspicuous unfitness for a place on the bench of the Court of Appeals. He should be defeated, and with him the oppressive monopoly which is actively seeking his election." He was defeated with the rest of the ticket. District Attorney Quinby was re-elected several terms in succession. After their victory the people went to sleep, but not the sower of tares. At the election of 1890 the nomination of this judge to a seat on the bench was secured from both parties. For fourteen years, therefore — from 1890 — a seat of the Su- preme Court, one of the most important tribunals of justice in New York State, will be occupied by this judge, before whom must come many questions affecting oil transportation, electric lighting, natural gas and illuminating, street railways, banking, and other interests of the oil trust. Monopoly cannot be content with controlling its own busi- ness. It is the creature of the same law which has always di'iven the tyrant to control everything — government, art, literature, even private conversation. Any freedom, though seemingly the most remote from any possible bearing upon the tyrant, may — will grow from a little leak of liberty into a 298 CRIME CSEAFER THAN COMPETITION mighty flood, sweeping Iiis palaces and dungeons away. Tlie czar knows that if he lets his people have so much freedom as free talk in their sitting-rooms their talk will gather into a tornado. In all ages wealth, like all power, has found that it must rule all or nothing. Its destiny is rule or ruin, and rule is but a slower ruin. Hence we find it in America creep- ing higher every year up into the seats of control. Its lobby- ists force the nomination of judges who will construe the laws as Power desires, and of senators who will get passed such laws as it wants for its judges to construe. The press, too, must be controlled by Power. During the criminal trial at Buffalo one of the oil combination's detec- tives was put on the stand. He was compelled to produce his written instructions from the counsel of the trust.' These had been given him at the office of the oil trust in New York. He forwarded his reports to its office in Ifew York, and re- ceived his pay from the same place.^ He sent his subordinates to get employment in Matthews' works, and through them obtained information from the inside. The monopoly paid one of these detectives $2.50 a day for spying, while he could earn only §1.50 a day for working. " I see here f urthei-," said the District Attorney, " ' Why the Express published the last complaint' " — in Matthews' suit for $250,000 damages. "Did he ask you to find out about that?" "He did." "That is, he wanted you to find out what arrangements were made with the Buffalo Express to have the complaint published ?" "Yes; tlie M'hole complaint. It covered the whole of the newspaper." "And do you know 'how many copies were taken by Mat- thews V Did he tell you to find that out, too ?" "Yes, sir.'" ' Testimony, Trusts, Congress, 188S, pp. 429, 894. ' Same, p. 894. ^ Testimony, Stenographic Report, p. 895. This passage also is omitted in the ti-anscript furnished the committee of Congress by the counsel of the trust. CHAPTER XXII ANOTHER TALE OF TWO CITIES The South is the most American part of America. Close observers note as its especial characteristic the preservation of the original Anglo-Saxon types, which gave this country its first and deepest impress. The South is not yet so steeped as the North in the com- mercialism to which it is all of life to buy and sell, and its population, less affected by trade and immigration, remains more nearly American, as the fathers were American, than the parts of the country flooded by the full force of the modern tide. Only in the South is there record all through this his- tory of a man " too prejudiced to buy " from those who claimed the sole right to sell. The merchants of Columbus, Mississippi, were buying their oil of the southern branch of the combination when they were offered a supply at cheaper prices by an independent refiner. They asked the combination to meet this competition of the market. This was refused. Thei-e were eleven firms there which sold oil in connection with other things. The combina- tion " coolly informed us," wrote one of the firms to a journal of the trade, " that we were in their power, and could not buy oil from any one else, and that we should either pay such prices as they demanded or not sell oil. We immediately formed an as- sociation among ourselves and ordered from other parties. On receipt of our first car they immediately put the retail price below the cost per car lots, and for some time tried to whip us in that way, as we still declined to handle their oil. They then wrote offering to rebate to several of the larger firms if they would withdraw and leave the smaller ones to fight the 300 ANOTHER TALE OF TWO CITIES battle alone. This proposition ^ve declined, and they again tried the low-price dodge, their agent telling us that they would spend $10,000 to crush us out. This game they have now been trying for three years, and in that time we have not handled one gallon of their oil." As these devices, irresisti- ble in more commercial civilizations, did not fool the brother- hood of Columbus, a special agent was sent to Columbus to carry on the war. "You can tell the Colnmbus merchants if this does not succeed we will have it out on other lines," the agent was in- structed, in the strain of the letter to the merchant of Nash- ville.' " The battle has not fairly opened yet ; sharpen up your sword, we mean war to the knife." And again: "We want Columbus squelched," was the word sent the agent from the headquarters at Louisville. He was ordered to start a grocery store in Columbus, to compete in their entire business with the "black- mailers." While the fight was on, and it was still hoped to conquer Columbus, the following was kept prominently before the people in the daily papers : " We desire to state that we did not establish an agency in Columbus to force the wholesale grocers to handle our oil." But seven years later the general in command of this de- partment told Congress it was his practice to fight in that way. "Almost invariably I did that alwaj's."^ " To threaten the people elsewhere with Columbus," the agent at Columbus was told, " will make them scat, as it were, and take our oil at any price." But the people of Columbus did not " scat." The new store had a complete stock of groceries. Prices on everything, including oil, were put <'down to the bone." But one essential feature of the en- terprise all the ingenuity and power of the invader could not furnish — customers. Goods were advertised at cost ; alluring signs were hung out with daily variations ; but the people would not buy. A few citizens who bought at the beginning, ' See p. 214. ' Testimony, Trusts, Congress, ISSS, p. 533 ; see also p. 734. AOBEEMENT OF THE PEOPLE 301 witliout iinderstanding the plan of campaign, came out in the newspapers with cards of apology, and pledges that they would not repeat the mistake. Local bankers refused to honor the drafts of the enemy, threw out its accounts, and gave no- tice that they would advance no money to persons who bought at its store. The public opinion of Columbus so bitterly re- sented the attack upon the livelihood of its merchants, be- cause they had dared to buy where they thought best, and so clearly saw that the subjugation of the merchants would be but the preliminary of a conquest of themselves, that any one seen within the doors of the odious store fell into instant and deep disgrace. " Their store is regarded as a pest-house," wrote one of the leading business men, " and few respectable people ever darken their doors, their trade being confined mostly to negroes. Their oil trade has dwindled down to al- most nothing, and we are selling now to merchants in other towns who heretofore bought exclusively from them." At the first sign of aggression the merchants had given up competition, which they saw meant only mutual ruin, and had tied themselves together in an association. Now as the strug- gle widened the people did the same, and found a greater benefit and pleasure in co-operation than in keeping up the delusion of the "higgling of the market" where there was no market. The Index, of Columbus, printed an agreement signed by hundreds " of those who will sustain our home mer- chants in the struggle they are making. ... It will receive many more siguatni-es among our citizens. . . . The people have only to understand to properly decide in this matter be- tween right and wrong." "You ask if the feeling is bitter against them in our 'com- munity,' " one of the merchants wrote. " I can only liken it to the spirit which prevailed when the people of Boston emptied King George's taxed tea into Boston Harbor." Attempt was made to intimidate the press. Advertise- ments were discontinued because the papers supported the cause of the people. "If the agent," said the Index, of Co- lumbus, " thought the cash that might be obtained for such 303 ANOTHER TALE OP TWO CITIES advertisements could purchase the silence of this journal when it should speak, or its support in a wrong cause, he reckoned without his host." " The pledge " was signed by practically every man in the place. The country people about Columbus, when they came to town to sell produce and buy supplies, took back with them blanks of the agreement not to buy the obnox- ious oil, and circulated them among their neighbors for signa- ture. Agents were sent among these country people to win back their trade, but they could not be moved. The competi- tion was made " war to the knife," and the knife " to the bone." It was a singular sight — this concentration of millions to "kill" these little men in this remote country town in far-off Missis- sippi. Nothing was too small to do. When one of the Colum- bus " rebels " bought oats for his trade, a competitive stock of the same kind of oats w^as hurried into Columbus, and these instructions sent with it : " Put your sign out. Eust-proof oats to arrive at 98 cents to $1 a bushel. This will kill him. The same signs should be posted about meats, sugar, coffee, etc." The plan of action of the Merchants' Association was sim- ple : they declined to handle the enemy's oil at any price. " Then to have a stock of our own alwnys on hand, ready to sell whenever we could at a profit, and hold in reserve when- ever they put prices below cost ; and in this way we have made it a losing business to them for over three years, and will con- tinue to do so as long as they remain in our town. . . . "When our association hxxjs a car of oil, each member paj's for and takes charge of an equal share, but the oil remains the prop- erty of the association ; and should any member sell out before the others, he has the right to buy from them at cost, and the next car is not ordered until all are nearly sold out." It is " our pleasure to make oil cheap " ; but a written prop- osition was made to the mercliants that if they would repent and return, the price would be 20 cents a gallon, with a rebate to the loyal dealers. As this oil could be, and was being, laid down in Columbus at 12 cents a gallon, the proposition amounted to a request that the merchants join in imposing a tax on the people of 8 cents a gallon, which must be added to TWO KINDS OF BROTHEREOOD 303 the retail price, and go to swell the profits of tlie " sj'mpathet- ical co-operation." "Can any one," said the Index, "after knowing these facts, donbt that in a pecuniary point our mei'- chants could have done better by surrendering tlie principle and joining the ring? But, at the same time, could any reason- ing man (even viewing it in the light of policy alone) advise such a course? — one which, if adopted, would only open the door for other monopolies to enter and demand high prices on meat, flour, and the other necessaries of life, until our city becomes the highest market in the land. Let all good citizens, then, unite in a steady effort to resist the yoke which this monopoly is now trying to force npon us, and let us teach them and all others that our people are too loyal to each other and too in- telligent to allow themselves to be made the instruments of their own destruction. " Kemember, that should our merchants be forced to yield, the day of low prices will be a short one, and then these stran- gers, having accomplished their purpose and forced their yoke upon you and us, will return to their homes, and while rioting in the taxes wrung from you, with your own assistance, will laugh at you for allowing yourselves to be so easily duped, and, emboldened by their success in forcing upon you high-priced oil, will soon return to demand high prices on sugar, coffee, and every other article of trade." The nose for news of the American press scented out the novelty of a whole community acting as one man in successful resistance to those who had till then found nowhere any cohe- sive brothorliness to make a stand against them. The newspa- pers of the country took the matter up. It was absolutely the first time any method had been found that could prevail against the tactics of divide and conquer, which had been elsewhere irresistible. Public attention was fascinated by the revelation that a brotherhood to ravage the people turned impotent when the people were roused to meet it with their brotherhood of the commonwealth. There was in the spectacle a moral illu- mination — the light that never fails. Instead of becoming, as had been planned, a warning to all the people of the dire 304 ANOTHER TALE OF TWO CITIES destruction to be visited upon any who dared to disobey, the encounter between the one-man power of united Columbus and the one-man power of hundreds of millions of dollars be- came every day more brilliantly a sign in the sky, showing all the people how the invasion of their industrial liberties could be changed into a ruin more complete than the retreat from Moscow. Scores of such assaults on the people had been won before. " What was being done at Columbus," said one of the papers, "is but what they have done before at Aberdeen, and at hundreds of other places North and South." But as despoilers always have to fear, one defeat may undo a lifetime of conquest. The success of the people of Columbus was teaching the people of the whole country, and of all mar- kets, that their real enemy was not the oil trust, but the lack of trust in each other. The people were learning there was a magic in association more potent than the trick of combina- tions. The Index proposed to the people of the South to join the citizens of Columbus, and make the fight general. " There is this about it : if there was concentrated action among the smaller cities and towns throughout even this section of the State, we would have no fear of the result. The oil trust may be too strong for a single small locality, but if a combination of a certain number of localities handling oil were effected, they would soon be forced to retire. Such a combination can be and should be brought about at once." The struggle at Columbus lasted three years. It had seemed unequal enough — a few thousands of dollars against hundreds of millions. But three years of this commercial warfare failed to break the spirit or resources of the brave — and wise because brave — people. The community never broke rank. They laughed when they were tempted with cheap coffee, flour, sugar, to join in the attempt to bankrupt their home mer- chants. They could see that the gift of forced cheapness, used to destroy natural cheapness, was a Trojan horse bearing within itself the deadliest form of dearness. Defeated, the oil lords gave up the contest, closed their store in Columbus, and left the people of that place free. NATURAL GAS BECOMES FROPEKTY 305 "Eugland," says Emerson, "reaches to the Alleghanies; America begins in Ohio." In the Western Eeserve of Ohio, hive of abolitionists and Union soldiers, was the same spirit of America which, at Colnmbns, Mississippi, had defended its market rights as outposts of all other rights. It was only a few years ago discovered that the flames of the "burning springs" of the Caspian Sea, China, and America, whose torches kindled the lamp of history, were beacon-fires uncomprehended by a procession of civilizations, and waiting to light man to the knowledge that the earth beneath him was a city of domes, huge receivers storing up the products of vaster gas -retorts below. Man found that he need not wait for this spirit to come to him out of the " caverns measureless to man." He could go to it, as in oil, and, tapping the great tanks, could lead their flighty contents to homes and mills, to emerge there as liglit and warmth and power. Experience in oil had made ready skill and capital to use the new treasure. In a very few years thousands of miles of pipe were laid, and millions of capital invested in the natural- gas business, mainly in Ohio and Pennsylvania. The gas was found in the same general localities as oil, and the methods of procuring and distributing it were similar, and the similarity easily extended to the methods of administering this bounty of nature as " property." Toledo began to be supplied in 1887 with the new fuel through pipe lines hy two companies. They obtained their franchises as competitors, but were soon found to be one in ownership, prices, and all details of man- agement. The discovery that the two companies at Toledo were really one, and that one the evil one of the oil trust, aroused the apprehensions of the j)eople, and these were in- creased by a number of circumstances. The Toledo companies got from the city as a free gift a franchise worth hundreds of thousands of dollars, on condition tliat they would supply Toledo before a certain date. But in the midst of the work of laying pipes they suspended opera- tions, and declared that they would do nothing more unless the City Council fixed, at rates dictated by them, the prices the peo- 20 306 ANOTHER TALE OF TWO CITIES pie ■were to pay. These rates were enough to pay not only a fair dividend, but to return in a few years every dollar of capital invested in lands, pipes, etc. Later they demanded another increase which, according to the sworn statement by their superintendent of the amount of gas supplied daily, would have amounted to $351,362.50 a year. They made the charges regardless of the ordinance, and used delay in furnish- ing gas as a means to make people willing to pay these ille- gal rates. Consumers seeking to renew their contracts were informed that the price would be doubled. The companies had assured the people that they should get their heat at half the price of coal ; but when the bills were footed up, the gas in many cases cost more than coal. The companies refused to supply fuel to an oil refinery which liad been built in To- ledo in opposition to the trust refineries. The companies dis- criminated against soine customers, and in favor of others. The power to say which maimfacturer should have cheaper fuel than his competitor was a power to enact prosperity or ruin.' It was a power to force themselves into control of any business they desired to enter." Tliose who controlled these gas companies appeared in the Circuit Court of the city in a proceeding which alone con- tained warning enough to put any self-governing community on guard. The Court was asked to deny the right of farmers in Wood County to give a way over their lands to the Toledo, Findlay, and Springfield Railway, being built to give the in- dependent oil-refiners and producers of the Ohio oil-field a route to market. The farmers in question had made leases to an oil corijoration of the trust, giving only the specific rio-ht to bore for and pipe and store oil and gas. Tlie farmers sup- posed that they had parted only with what they had signed away in the leases. They supposed they still owned their farms. "When the new railroad sought the privilege of a right of way the farmers granted it. Suit was at once brought for an injuiiction to prevent this use of the land. According to ' See ch. xxv. SUFFRAGE OF TUB DOLLAR 307 the logic of the claim in these cases a farmer who has made such a lease could not build a road across his own farm with- out permission. " Most certainly not," was the reply made by one of the lawyers to the judge who asked if the farmer could do so. By occurrences like these an increasing number of influen- tial citizens were convinced that the gas companies would hold a power over the comfort and daily life of the people not wise to surrender entire to any corporation. An agitation was begun for the supply of gas to the people by themselves act- ing through the municipality. Six thousand citizens sent a pe- tition, in the session of 1887-88, to the Legislature to pass the necessary enabling act. Tliere was a discussion of the project for two years. Public opinion grew more favorable every day. The citizens chartered a special train to carry a delegation to Columbus the day the pipe-line law came before the Senate. The Legislature in 1889 passed the law. It authorized the people of Toledo to issue bonds to the extent of §750,000 to buy gas land and build pipe lines. This legislation was, of course, bitterly opposed by the existing gas companies, and they demanded of the Legislature that before the law became operative it should be ratified by a three-fifths vote of the people. The friends of this scheme of municipal self-help and independence accepted the challenge. In the ensuing cam- paign the opposition to the people was officered by the presi- dent of one of the natural-gas companies, twice Governor of Ohio, afterwards United States Secretary of the Treasurj'. The natural - gas trustees of the City of Toledo in an official communication said : " There is reason to believe the money of the natural-gas companies was freely spent to defeat it." Tlie act was ratified April, 18S9, by a vote of 7002 for to 4199 against — " a vote," say the trustees, " in which the heavy taxpayers were largely acting with the majority." ' Organ- ized labor took an enthusiastic part in the work of this elec- tion. The Central Labor Union held a special meeting which ' Report of Citizens' Committee on City of Toledo and Its Natural Gas Bonds, p. 6. 308 ANOTHER TALE OF TWO CITIES filled the largest public hall. Men paraded the streets with banners favoring the policy of independence. The Knights of Labor held meetings to discuss the project, and the Central Council, representing all the assemblies in the cit3', passed unanimously resolutions appealing to all members of the or- der and all working-men to support no candidate who would not pledge himself to the city pipe line. At a meeting of the glassworkers it was resolved to be " the duty of every work- ing-man to vote 'Yes' for the pipe line next Monday." "Many of us glassworkers," said the resolutions adopted, "have been employed in factories in the Ohio Valley, receiving their nat- ural-gas fuel from a gigantic corporation similar to that which now supplies Toledo. We have seen our employers unfairly dealt with, and arbitrarily treated in the matter of making rates. Some of them were forced to go into the courts, to prevent the extortion of the piratical company who were bent on assessing each citizen and industry at the highest rate pos- sible, irrespective of its effect on the industries or the wages of the employes. Many manufacturers were compelled to move their plants to the cheap gas-fields of Ohio and Indiana. The employes were compelled to break up their homes and emigrate, in order to follow their trade for a livelihood." The qi;estion came before the people again the next spring, when both the Republican and Democratic parties by acclamation renominated a natural -gas trustee, whose term was expiring, to succeed himself. At the election the vote was 8958 for, and only 5S against — a practically unanimous indorsement of the project by the people. Toledo now began to make history. " It is entirely safe to say," a well-known citizen declared in the Toledo Blade, "that in the history of this country no other people have been called to the experience which Toledo has been undergoing for the past year. Communities often are agitated and divided on questions of local policy ; but no second case will be found in which a people, after settling such questions among them- selves according to recognized rules, were confronted with warfare, bitter and persistent, such as this city is now called NINE MEN AGAINST NINETY THOUSAND 309 to meet, and at the hands of a combination wholly of non- residents, without the slightest proper voice in their domestic concerns." In every direct encounter with the " commons " the "lords" had been defeated — in the two years' debate which preceded the first appeal to the Legislature ; in the Legislature, where the bill passed the House almost unanimously, and the Senate more than two to one ; in the appeal to the voters ; be- fore the governor, who had been approached to cripple the enterprise of the municipality by naming unfriendly trustees. The gas companies had tried at each city election, after the Legislature acted in 1889, to seat in the City Council a ma- jority in their interest ; but the people, making the city pipe line the issue of the election, gave an overwhelming prepon- derance of their votes to the men pledged to see it tlii-ough. " Strong and subtle opposition " ' was then brought to bear on the Common Council to prevent it from passing the neces- sary ordinances ; but, in spite of it, both branches of the Coun- cil voted them unanimously. A clearer case of the will of the people and of law and order there could not be. A free and intelligent community, in a matter of vital concern to its industrial freedom and business prosperity, after thorough dis- cussion, in which all sides had been freely heard, had by eou- stitutional proceedings decided by an overwhelming majority upon a policy altogether within its legal, moral, and contract rights. The ablest lawyers, writers, and financiers that money could hire had had it under the microscope to find some breach for attack, but had not been able to find a flaw. All was constitutional, legal, proper, and expedient. A glance at the contestants brings out in clear outlines some conditions of our modern development which liav'e come upon us almost unawares. The City of Toledo was a vigorous community of 90,000 people ; its opponent was a little group of men ; but they controlled in one aggregation not less than $160,000,000, besides large affairs outside of this. The assessed valuations of the property of the people on which Toledo could levy ' Citv of Toledo aud Its Natural Gas Bonds, p. 5. 310 ANOTHER TALE OF TWO CITIES taxation was, in 1889, but $33,200,000. The total income of tlie mnnicipality was $961,101 ; that of a single member of the little group opposing them had been acknowledged to be $9,000,000 a j-^ear, and was believed by the best informed to be several times as innch. This individual income was greater than the product of all the manufactories of the city, and three times greater than the combined wages of the work- men in these establishments. There were several members of the natui-al-gas sj'ndicate who collected and disbursed every year more than the community. Toledo had about the same population as Kansas in 1856. The slave power of the South that assailed the liberties of the 90,000 in Kansas numbered millions, but the new power in tlie North, which in a short generation had grown so strong that it did not fear to attack the 90,000 freemen of Toledo, counted only nine names. The people could act only after public deliberation, and through the slow stages of municipal and State procedure. Their an- tagonist met in secret council, and devised plans executed by a single hand, armed with the aggregated power of hundreds of millions of dollars, and liable, if found illegal or criminal, to only "nominal" punishment, or only 6 cents damages.^ At Columbus the struggle was with something xe\-y simple but extraordinarily difficult to overcome, as simple things often are — an obstinate, immovable, thoroughl}' angry public opin- ion, acting only through private voluntary means, its set will to exchange the fruits of its labor with whom and on what terras it pleased. There was absolutely no leverage to be got to bear upon tlie people of Columbus except by chang- ing their feelings. Compulsion was out of the question. But at Toledo compulsion Was possible. Tliere the people had acted not through unofficial combination as at Columbus, but through the official macliinery of the town and State. If the law could be turned against them by able counsel or com- pliant judges; if any smallest fault, however technical, could be found in the legislation of the State or the city or the ' Chs. xiv. aud xxi. MONOPOLY BY FORCE OF ARMS 311 practical administration of the official machinery provided for the natural-gas business of the city — if this could be done, the people of Toledo could be compelled, however little their will liad changed, to see their enterprise of independence balked ; this compulsion could be carried to the use of force if they resisted, and the militia of the State and the regular army could be brought into the conflict. Such is the prize of power which tempts — more than tempts, drives as by fate — our overgrown wealth to fortify itself by control of judges, governors, presidents, commanders-in-chief — all the agents of the supreme authority and force. Columbus was so local that its people were sufficient unto themselves. All they had to do was to keep on saying, We will not buy. But Toledo was a citizen of the great world of affairs and finance. It was part of London, New York, Chi- cago. Much of it was owned as an investment elsewhere. Sensitive nerves connected it with all the markets, especially the greatest of all — the money-ma'rket. It sold and bought and borrowed and lent far beyond its own border. What Wall Street gossips said about the people of Columbus would not make a dollar's difference to the whole town in a year, but a whisper started through the offices of the great cajjitalists in ISTew York and abroad would flash back by wire to Toledo, and go like a quick poison through its industries and credit, private and public. "Private enterprise" could not afford to let the people of Toledo go forward with their public enterprise. Many mill- ions had been invested in getting control of a business repre- senting $200,000,000. Many towns and cities, as Fostoria, Sandusky, Fremont, Clyde, Bellevue, Norwalk, Perrysburgh, Tiffin, and Detroit, were being supplied with gas at a hand- some profit. If Toledo should set a successful example of self-supply, it would find imitators on every side. The essence of " private enterprise " was that the people should get their gas from Captains of Industry, and pay them for their cap- taincy two or three times the real cost as profit, just as mo- narchical countries pay kings for kindly supplying the people 312 ANOJ'HER TALE OF TWO CITIES ■with the government which really comes from the people. The essence of municipal supply was that the people should supply themselves at cost without profit, and without Captains of Industry', except as the people provided them. Toledo, in fine, proposed to keep step with the modern expansion of self- government, which finds that it can apply principles and meth- ods of democracy to industry. It proposed to add another to many demonstrations already made, noticeably in this very department of gas supply to municipalities, of the truth that the ability to carry on the business of supplying the various wants of mankind is not a sort of divine right vouchsafed from on high to a few specially inspired and gifted priests of commerce, by whose intermediation alone can the mysteries of trade be operated ; but, like the ability to govern and be governed, is one of the faculties common to mankind, capable of being administered of, by, and for the people, and not need- ing to be differentiated as the prerogative of one set of men. The Toledo experiment was another step forward in the world- wide movement for the abolition of millionaires — a movement upon which tlie millionaires look with unconcealed apprehen- sion for the welfare of their fellow-beings. Mankind views with equanimity the expulsion of the profit- hnnter from the businesses of carrying letters, minting coins, administering justice, maintaining highways, collecting taxes, in which millionaireism has been universally put an end to. It views with hopes of larger results the newer manifestations of the same tendency which in England have abolished mill- ionaireism in telegraphs and parcel express ; in Germany and France, Australia, and India have gone a long way towards the abolition of the millionaire in railroads ; and in various cities and towns in Europe, America, and Australia have put up local signs, " No millionaires allowed here," by the munic- ipalization of trade in water, gas, electricity, street-railways, baths, laundries, libraries, etc. The trust of millionaires was therefore fighting for a principle, and what will good men not sacrifice to principle ! CHAPTER XXIII FKEEDOM OF THE CTTT Towns, like men, stamp themselves with marked traits. Toledo had an individuality which showed itself from the start. Its leading men clubbed together and borrowed money as early as 1832 to build one of the first railroads constructed west of the Alleghanies — the Erie and Kalamazoo, to connect Toledo and Adrian. When, in 1845, the steamboats on the lakes formed a combination, and discriminated against Toledo, the city through its council refused to submit, and appropri- ated $10,000 to get an independent boat to Buffalo. The city appropriated its credit and revenues to other important and costly enterprises, including four railroads, to keep it clear of the cruel mercies of private ownership of the highways. In 1889 it expended §200,000 to secure direct railway connec- tions with the Pennsylvania and the Baltimore and Ohio rail- ways for competition in rates with the Lake Shore Eailroad. As it had been authorized to do so by the State, the City Council of Toledo, April 29, 1889, ordered gas bonds to the amount of §75,000 sold, that work on the city pipe line might begin. Before proceeding with the enterprise confided to them, the natural-gas trustees gave the private companies an opportunity to save themselves from the competition of tlie city. They asked them in writing if they would agree to furnish gas cheaply for a term of years, or if they would sell their entire plant to the city ? They did this, as they ex- pressed it, as " an honorable effort ... to obtain cheaper gas without unnecessary expenditure, and without injury to es- tablished rights." After a delay of nearly a month a reply was received, refusing to enter into negotiations either for a 314 FREEDOM OF THE CITY reduction of charges or for the sale of tlie private plants to the city. The trustees then asked for a personal interview, but this was refused. Then when the city began preparations to sell its bonds, a cannonade was opened on it in the courts, the money-market, the gas-fields, the city government, the press, among the citizens, and everywhere. Injunctions were ap- plied for in three courts, nnsuccessfully in all instances. No injunction was ever granted in these or any other of the many suits brought for the purpose of enjoining the sale of the bonds. Courts will nsually grant temporary injunctions awaiting a hearing on the merits when complainants will enter into ample bonds and indemnify defendants. But the par- ties instigating this litigation would not put up the necessary bonds. They thus could smirch the bonds without incurring any personal liability in so doing. An expensive array of lawyers was sent before the United States courts to prevent the issue of the bonds on the ground that they were illegal, and the law under which they were issued unconstitutional. The principle involved had been fre- quently discussed and always upheld both by the Supreme Court of Ohio and the Supreme Court of the United States.' "Does not your argument appear to be in conflict with the views of the Supreme Court of Ohio and the Supreme Court of the United States ?" the judge asked. The counsel for the gas companies responded in substance : " If so, then so much the worse for the views of those courts." As it was through the suffrage that the people of Toledo were able to do this, the attack was widened from an attack on the enterprise to one upon the sovereignty of the citizens which made it possible. " Everybody votes in Ohio- — in fact, too many people," said the lawyer who applied for an injunc- tion against Toledo. If he had his way, he declared, there would be fewer voters, and he stigmatized the arguments of Toledo as those of John Most, the communist. " Unquestionably," decided Judge Jackson, " the Legisla- ' State, ex rel, vs. City of Toledo, 48th Ohio State Keports, p. 112. THE CITY RAB TRE RIGHT 315 ture may authorize a city to furnisli light, or facilities for transportation, or water to its citizens, with or without cost, as the Legislature or city may determine. . . . Since the de- cision in Sharpless vs. Philadelphia it is no longer an open question whether municipalities may engage in enterprises such as the one contemplated by the act in question in this case. The act of January 22, 1889, authorizing the city of Toledo to issue bonds for natural -gas purposes, is clearly within the general scope of legislative power, is for a public use and purpose, and is not in contravention of any of the provisions of the constitution. The court being of the opin- ion that the legislation is valid, it follows, of course, that the injunction applied for must be refused." ' When the news of Judge Jackson's decision was telegraphed to Toledo noth- ing less than the booming of cannon could express the jo}' of the citizens. They sent this message to the just judge : "One hundred guns were fired to-night by the citizens of Toledo in honor of your righteous decision to-day." Judge Jackson again upheld the bonds at Toledo, January 14, 1890, when he again dismissed the case against the city " for want of equity, at cost of complainants." The favorable decision by Judge Jackson, although an ap- peal was taken, made it possible for the cit^' to sell the $75,000 bonds which had been issued by order of the Coimcil. The bonds brought par, interest, and over §2000 premium. "With the money thus procured the city's Board of jSTatural Gas Trustees began operations. Their opponents had spread far and loud among the voters before the election — among those who would be likel3' to buy the bonds, everywhere it would hurt — the assertion that all the territory that was good had been bought up by them, and the city's trustees would not be able to get any. One of the companies had no less than 140,000 acres of gas lands in its possession or under con- tract, at a cost in rentals and royalties of $100,000 a year."" But the city trustees, even with the small sum at their com- ' Federal Court Reporter, vol xxxix., pp. 651-54. ' Keport of the Northwestern Ohio Natural Gas Companj, January '7, 1SS9. 316 FREEDOM OF THE CITY mand, were able to secure at the very beginning wells with a capacity more than four times as great as the private com- panies had had when the latter began tlie investment of a million or moi'e to lay their pipe lines to Toledo.' Together with this supply the city trustees got 650 acres about 35 miles from Toledo of as choice gas territory as there was in Ohio, almost all of it nndrilled, and they had offers amounting to 5000 acres more within piping distance from the city. The city's trustees made their purchases with success, and received the laudations of their constituents for having got lands and wells at better prices than the private companies. August 26, 1889, after a decision in the United States courts that there was no ground on which to object to the issue of the bonds, the City Council voted the issue of the remaining $675,000. Defeated in the public debate which preceded the decision of Toledo to supply itself ; defeated at the State Capitol ; de- feated at the polls of Toledo time and again — every time; defeated in the Common Council ; defeated in the gas-fields ; defeated in the courts of their own choosing, the opponents of the city, thorough as only the very good or the very bad can be, refused to submit. "When the two corporatious, in 1886, were seeking the franchise indispensable for doing business in Toledo, they said to the Board of Aldermen : " We ask no exclusive privilege. . . We cannot have too many gas companies." They also said : " If the city desires to furnish its own gas, there is nothing in this ordinance to hinder it. We are ready and willing at any time to enter into competition with the city or any other company'." They said, on the same occasion, in answer to apprehensions which had been expressed about the danger of .putting the fuel supply of tlie city into the hands of a monopoly' : " Yovi can go before the Legislature and obtain the right to issue bonds for furnishing youi-selves with gas." It was by these assur- ances the companies induced the Common Council to grant ' Toledo and Its Natural Gas Bond?, pp. 36-37. A FREE PRESS 317 them gratuitously the very valuable franchises they were seeking. The right of the people to compete was not left to these assurances. It was specifically and formally asserted in the ordinance of July 5, 1887, fixing rates. This was the ordi- nance to procure which the gas company suspended its opera- tions in mid-course, and declared it would not continue unless the prices which it wanted were made. The ordinance was, in fact, prepared by the company. It said : " Provided that nothing herein contained shall be constrned as granting to existing companies any exclusive rights or privileges, or pre- vent any other company from furnishing natural gas to the citizens of said city." But the same learned coimsel who, in behalf of the companies, had assured the city that " there was nothing in this ordinance to hinder it," went before the Unit- ed States Court and pleaded that ordinance as good reason for the intervention of the Federal Government to prevent the city from going on with its enterprise. The onl}"^ morning paper — an able advocate of the city pipe line — suddenly changed owners and opinions. Among its new directors were two of the lawyers of the trust opposing the city, a director in one of its companies, and, besides them, the manager, a contract editor from Pennsylvania. His sole conspicuity there had been won in turning against the peo- ple of the oil regions a paper which had been their stanch est defender. This Toledo daily, in its espousal of the cause of the citj', had been firing hot shot like this against the oil combination : " It wants a monopoly of the natural-gas busi- ness. This is what it is driving at." Under its new man- agement it roared like a sucking dove, thus: "It is fash- ionable with demagogues and men who are not capable of appreciating the worth of brains in business to howl against it " — the oil combination — " as a grasping, grinding monop- oly." Just after the people had decided in favor of the pipe line, and only a few days before it changed owners, it had said : " All manner of influences were brought to bear to de- feat this proposition. . . . All the plausible falsehoods that could 318 FREEDOM OF THE CITY be invented, and all the money that could be used, were indus- triously employed, but the people saw the situation in its true light, and the majority voted right." It now made the defeat of the city's pipe line the chief aim of its endeavors. In this work " no rule or principle recognized in decent journalism was respected." In all the history of Toledo no interest on its bonds had ever been defaulted or delayed ; no principal ever unpaid at maturity. The city was prosperous, its growth steady ; its debt growing less year by year in proportion to its popula- tion and wealth. Its bonds ranked among the choicest in- vestments, and commanded a premium in the money-market.' Bat the credit and fair fame of the city were now over- whelmed with wholesale vituperation by this paper, and others elsewhere under similar control. Articles were carefully pre- pared for this purpose by skilled writers. These were then copied from one newspaper to another. By some arrange- ment insertion was obtained for them in financial journals in ISTew York and in London, and in other foreign capitals. The Toledo organ declared that Toledo was an unsafe place for the investment of capital in any form. Its public affairs were said to be run by a set of " demagogues and speculators," whose administration was " piratical mob rule." The city pipe line was a " monstrous job," and the men who favored it were " a gang of throttlers and ravenous wolves." They were " blatant demagogues, who made great pretence of advancing the city's interest, but whose real aim is to enrich themselves at public expense." The bonds, which had been issued in due form by special authority of the Legislature, ratified by a vote of more than three-fifths of the citizens, and declared to be valid by the United States Court, were described as " chro- mes," "worthless rags," "bad medicine," "disfigured securi- ties," " like rotten eggs, highly odorous goods," " but few per- sons at most can be found ignorant enough to buy them." The Mayor, City Auditor, Board of Natural Gas Trustees, 1 City of Toledo and Its Natural Gas Bonds, p. 3. A HOT-BED OF MBETOBIC 319 united with a citizens' committee of the Board of Trade in a plan to promote the sale of the bonds direct to the people of Toledo through a financial institution of the highest stand- ing. This action the paper described as " a scheme for gulling simples," "a blind pool," "an unpatented financial deadfall"; compared it with "gambling, pool -playing, and lottery sell- ing." These grave charges were widely circulated through- out the country. Bankers and capitalists in other cities who received them had no means of knowing that they were not what they pretended to be — the honest if uncouth utterances of an independent press chastising the follies of its own con- stituency. Newspapers which supported the city's project were assailed as ruthlessly as the community and citizens. The Blade was constantly referred to as " The Bladder." An- other journal was given a nickname too vulgar to be printed here. One of the most pi-ominent journals of Ohio was pun- ished by the following paragraph, which is a fair sample of the literary style of monopoly : " That aged, acidulous addle- pate, the monkey-eyed, monkey-browed monogram of sarcasm, and spider-shanked, pigeon-witted public scold, Majah Bilge- water Bickham, and his backbiting, black-mailing, patent- medicine directory, the Journair An old journalist and honorable citizen who wrote over his initials, " C. W." a series of able and dignified letters in the Blade, which had a great influence in the formation of public opinion in favor of the pipe line, was assailed with " brutal falsifier," "hoary old reprobate," "senile old liar." Carica- tures were published depicting the buyers of the bonds as " simple greens." When the County Court of Lucas Count}', following the United States Court, sustained the bonds on their merits, and did so on every point in question, because, as the judge stated, "the equities of the case are with the de- fendants," the organ falsely stated that judgment for the city was given " because the merits of the case are involved in a higher court." When a capitalist of New York, who had been an investor in the bonds of Toledo and a taxpayer there for twenty-five years — one of the streets of the city was named 920 FREEDOM OF THE CITY for liim — bought §10,000 of the city pipe-line bonds, the paper attacked him by name in an article headed "Bunco Game," charging him with being a party to a bunco game in connection with " public till-tappers " for " roping Toledo citi- zens into buying doubtful securities." Wlien the Sinking Fund Commissioners of Toledo very properly invested some of the city's money in the gas bonds, they were held up by name as "public till-tappers," "menials" of a "hungry horde" of "boodle politicians," accomplices of "jjlunderers of the public treasury," unable to withstand "the brutal tlireats and snaky entreaties of the corrupt gas ring." For one of the associate editors the position of Deputy State In- spector of Oil was obtained — an appointment which cost the Governor who made it many votes in the next election, and did much to defeat him. Such an appointment might give a versatile employe the cliance to do double duty : as editor to brand as bad good men who could not be bought, and as in- spector to brand as good bad oil for sale.' One of the means taken to defeat the pipe line was the pub- lication of very discouraging accounts of the "failure" at In- dianapolis, where the citizens had refused to give a natural- gas company belonging to the oil trust the franchise it de- manded, and, forming an anti-monopoly trust, had undertaken to supply themselves. Some "influence" prevented the Com- mon Council of Toledo from sending a committee to Indian- apolis to investigate. A public-spirited citizen, prominent and successful in business, came forward, and at his own expense secured a full and accurate account of the experience of In- dianapolis for the city. This proved that the people were getting their fuel gas at less than one-half what Toledo was paying. The contest against giving the Indianapolis fran- chise to a corporation of the trust had been a sharp one. Its success was due to the middle classes and the working-men, who stood together for freedom, incorruptible by all the powerful influences employed. " We will burn soft coal all ' See cb. xxix. PEOPLE'S TRUST OF INDIANAPOLIS 321 our lives," one of their leaders told the Toledo committee, " rather than put ourselves in the power of such men." In Indiana the Legislature meets only once in two years, and when this issue arose had adjourned, and would not meet again for a year. The people, not being able to get authority for a municipal gas pipe line, went to work by voluntary co- operation. Every voting precinct in the city was organized and canvassed for the capital needed. The shares were. $25 each, and they were bought up so rapidly that the entire amount — $550,000 — was subscribed in sixteen days by 4700 persons, without a cent of cost to the city. When subscrip- tions to the amount of $550,000 had been raised, $600,000 more was borrowed on certificates of indebtedness. Gas lands were bought and 200 miles of pipe lines laid, all at a cost of about $1,200,000. The income in one year, during a part of which the system was still under construc- tion, was $349,347. In the first year of complete operations the Indianapolis people's trust paid off $90,000 of the princi- pal. The income for the year ending October 31, 1892, was $483,258.21, and the bonded debt has been paid. The stock, since January 1, 1893, has been paying dividends at the rate of 8 per cent, a year. A prominent citizen of Indianapolis, one of tlie State judges, told the Toledo papers, in an interview : " The pri- vate companies had their gas laid to the city and along the streets several months in advance of the Citizens' Trust, but it did them little good. Everybody said : ' I will wait for the Consumers' Trust.' ' Yes, but we will furnish you gas just as cheap,' said the Indianapolis company ; ' why not take it of us V To this the citizens replied : ' To take gas of you means cheap gas to-day, bnt high gas to-morrow.' And wait for the gas they all did." The charge to manufacturers was 2^ cents a thousand feet, as against 8 cents, at that time charged at To- ledo. There were 12,000 private consumers. Cooking-stoves in Indianapolis were about $12 a year, against $19.50 in Toledo. One of the representatives of the private compan}' declared at a public meeting at Indianapolis that its charges were made 21 322 FREEDOM OF THE CITY such as to give a full return of all the invested capital in three years, as that was the probable life of the supply. A year after the inauguration of the Indianapolis movement a com- mittee of the citizens at Dayton, who had risen against the ex- tortionate 2>nces charged them, investigated the condition of affairs at Indianapolis. They reported that Indianapolis had paid $200,000 on its bonded debt, and was getting ready to pa}"^ as much more. The Consumers' Trust supplied between 10,000 and 11,000 consumers, and spent $1,000,000 less than the Dayton private company spent to supply 3000 fewer con- sumers. The annual charge at Dayton was $54.80 ; at In- dianapolis only $26.80 — less than half. When facts like these were brought out, to the demolition of the fictions circulated in Toledo, the answer was charac- teristic. The "organ" could not deny the statements, but it fell upon the citizen through whose generosity the informa- tion had been got for the people, and assailed his private char- acter in articles which, one of the daily papers declared, edi- torially, " would almost, if not quite, justify him in shooting their author on sight." This newspaper charged the city natural -gas trustees with being " rotten to the core," and with every variation of phrase possible to its exuberant i-hetoric sounded the changes upon their official career as a " big steal," " fostered by deception, falsehood, and skull-duggery." It sought to intimidate the Legislature and the courts when they failed to enact or con- strue laws against the people. It said : " Law-makers, judges, and others may feel the force of this element when the proper time comes and political preferment is sought." It was money in pocket that facts like those of the experi- ence of Indianapolis, Detroit, and other places should not be made known. Even ideas must not be allowed to reach the public mind. Professor Henry C. Adams, the well-known political economist, lectured in Toledo during this contest, in a University Extension Course, on "Public Commissions Con- sidered as the Conservative Solution of the Monopoly Prob- lem." The " organ " gave a synopsis of the lecturer's views. rOISONINO THE SPBINQS OF PUBLIC OPINION 323 whicli is printed herewith in parallel columns, with a synopsis of what Mr. Adams really said, as revised by himself : WHAT THE ORGAN OF MONOPOLY REPORTED. The lecturer made reference to Toledo as an unfavorable place to discuss the matter of municipal con- trol of quasi - public business and competition of municipalities with private corporations. But he depre- cated anything in that line. He did not mention particular instances, but broadly condemned the policy pur- sued by this city in matters of this kind, and his remarks had a visible effect on his audience. He con- sidered municipal control of busi- ness enterprises the worst form of monopoly, as they began by having the unfair advantage of the law- making power, and the tendency to corruption was greater tlian when individual enterprises were asking privileges. The audience was much pleased with the lecturer. WHAT THE LECTURER SAID. REALLY Professor Adams thought the so- lution of the monopoly problem must be found either in public con- trol or in public ownership. He ad- vocated public control, and held that the State and Federal railroad commissions should have a fair trial, that their hands should be strength- ened by further and adequate legis- lation. He entertained the hope that this control and regulation would ultimately protect the interests of the public in a satisfactory manner. He was willing to admit, however, if this effort to secure the needed public control by the aid of commis- sions and legislation should fail, then public ownership was the only re- maining solution. He held that in local monopolies it may still be wise to try the experiment of public con- trol b}' aid of commissions. He said, however, that if anything should be owned and controlled by and for the people it would be street-railroads, gas and water works. He admon- ished his audience not to be misled by the argument that municipal owner- ship would be dangerous because of undue political influence, for the local monopolies under private own- ership were already in politics, and in a most dangerous manner. He ob- served facetiously that he hesitated to discuss the question of municipal control or ownership before a Toledo audience. From the control of the markets to the control of the minds of a people — this is the line of march. 324 FREEDOM OF THE CITY So direct, persistent, and bold were the charges of corrup- tions rung day after day by this journal against all the offi- cials concerned in the city gas enterprise that some people began to believe there nmst be truth in them. But when the commnnity at last turned upon its raaligners, and the grand- jury brought indictments against the active manager of the paper and his chief assistant for criminal libel upon the city's natural-gas trustees, the whole structure of their falsehood went down at a breath. They had no defence whatever. They made no attempt to justify their libels or even explain them. Their only defence was a series of motions to get the indicted editor cleared as not being responsible for what had appeared in the paper. Counsel labored over the contention that the accused was none of the things which the language of the law holds for libel. He was neither the " proprietor," " pub- lisher," " editor," " printer," " author," nor a person "who ut- tered, gave, sold, or lent" a copy of the newspaper, but only the " manager." The employes gave testimony which would have been ludicrous but for the contempt it showed for court and communitv. The journalist who was the "manasring edi- tor " of the paper under the indicted chief editor was asked : " Who was the head of the paper when you entered upon your duties as managing editor ?" " I do not know." " Who hired you as managing editor ?" "I really can't say that I was hired at all." " Who employed you to come to Toledo ?" The witness had been an employe in Pennsylvania of the editor on trial, and had followed the latter to Toledo to take the place of managing editor. " Nobody employed ine."' The son of the indicted editor had also followed his father to Toledo, and was employed on his paper. Asked for what purpose he came, he said : " I had no purpose in coming." Tlie gentleman who had charge of the counting-room was asked who fixed his salary. " I regulate my own." The advertising manager declared : NO NEED TO 00 TO JAIL 325 " I have no knowledge who is my superior." The accused had to let the case go to the jury witliout a spark of proof of the accusations which had filled the paper every day for months. He had no evidence to ofEer either that the charges -were true, or that he believed them to be true. He stood self-confessed as having for years printed daily gross li- bels on citizens, officials, and community, as part of the tactics of a few outside men to prevent a free city from doing with its own means in its own affairs that which an overwhelming pub- lic opinion, and the legislative, executive, and judicial authori- ties, and its present antagonists themselves, had all sustained its right to do. The agent of this wrong was found guilty, and sentenced to imprisonment in the county jail, with heavy costs and fine ; like the nnhappy agents at Buffalo — " made cheap " for others.' But sentence was suspended pending hearing of the motion for a new trial. This did not come up for a year. The court could find no error in the proceedings of the trial court, and could not sustain any of the objections made. But it found a point which even the lawyers had not hit on, and strained this far enough to grant the new trial. Then the convicted editor went before another judge — not the one who had tried him — ^pleaded guilty, and was fined, and so saved from jail. One of the last scenes in this Waterloo was the abandon- ment of the newspaper with which the corruption and intimi- dation of public opinion had been attempted. Failure was confessed by tlie sale of the paper, and it was bought by a journalist who had been especially prominent in the defence of the city, and against whom on that account a bitter war- fare had been waged by the daily which now passed into his possession. The Sunday Journal of Toledo, in commenting on the surrender, declared that the course of the organ had been one of the strongest factors of the success of the people. " In every possible way it slandered and outraged the cit}', where of necessity it looked for support. There could be but one result. Scores who had opposed the pipe line became its most ardent advocates purely in the general defence." ' See ch. xx. CHAPTER XXIV HIGH FINANCE "When Judge Jackson refused to enjoin the city from issu- ing its bonds an appeal was taken. The court and the law- yers of the city were promised that it would be carried up without delay. Months passed, and no use was made of the privilege of filing new pleadings and taking new testimony — that is, no use but to make the suits the basis for libels on Toledo and its bonds. Time ran on until the day was at hand for opening bids for the bonds. Tliat was to be "Wednesday. Then the counsel for the opposition notified the city that on Monday they would begin tlie taking of depositions. This was not then or after- wards done, but on tlie strength of the notification news de- spatches were sent over the country that the proceedings against the legality of the Toledo bonds were being " pressed." In consequence of this and other manoeuvres, wlien "Wednes- day came there were no bids. A husty rally of some public- spirited capitalists at home, learning of the emergency, made up a subscription of $300,000. The names of the citizens who made this patriotic subscription were printed in the daily paper under the heading of "The Honor Eoll." Only by extraordinary manoeuvres could the market for such securities offered by such a community have been thus killed in a time of great general and local prosperity, and ex- traordinary they were. "What they were was formally and authoritatively ascertained by an investigation made by a committee appointed at a mass -meeting' of the citizens of ' October 19, 1889. ANONYMOUS CISCCLABS IN WALL STREET 327 Toledo called by the mayor, the Hon. J. K. Hamilton. The call ran : "For the first time io the history of Toledo, its general bonds, secured by the faith and property of the city, and bearing a fair rate of interest, have been offered, and only such of them sold as were taken at home by popular subscription. It is deemed desirable that under such circum- stances the citizens of Toledo should meet togetlier and determine what further steps should be tal^en to carry out the will of the people as ex- pressed by 63 per cent, of the voters of the city. "It is believed that with proper effort a large additional popular sub- scription may be obtained, and thus notice given to the world that not- withstanding all opposition the citizens of Toledo have confidence in and will maintain the credit of this fair city, and that a great enterprise undei'- taken bj' its people will not be defeated by the machinations of private op- posing interests, no matter how powerful and unscrupulous." The meeting appointed a committee of three — David Kob- inson, Jr., Frank J. Scott, and Albert E. Macomber — " to pre- pare and circulate throughout the financial circles of the country a pamphlet which shall set forth the case of the city of Toledo in its struggle against those who by anonymous circulars and other dishonorable ways have attempted to pre- vent the sale of the Toledo natural-gas bonds." This com- mittee put the facts before the public in a very able pamphlet, "The City of Toledo and Its ]S"atural Gas Bonds." In an official statement asked for by this committee the city nat- ural-gas trustees say: "Skilled writers were employed to furnisli articles for Eastern financial journals, to cast discredit on the bonds on the very grounds that had been set aside hy Judge Jackson's decision. Not content with this open war- fare, anonymous circulars were sent to leading investment agencies in the United States, warning them to beware of these bonds, as thej' were under the cloud of doubtful consti- tiitionality and an impending lawsuit. When the day arrived for bidding for the bonds no bids were made. Agents of in- vestors were present, who came to bid, but by some unknown and powei'ful influence they were induced not to put in their bids. The writers are not aware that any similar mode of striking at the credit of a whole community was ever before 328 BIOH FMANCE resorted to in tliis country. It is an insult and a wrong not only to this city, against which it is aimed, but to people of in- dependence everywhere in the United States who have a com- mon interest in the maintenance of the rights of all." ' Press despatches impugning the validity of the bonds and misrepresenting the facts were sent all over the country. The anonymous circulars referred to were mailed to all the leading banks, investment agencies, capitalists, and news- papers. The New York Mail and Express said : " It would be decidedly interesting to know who is responsible for the . . . methods by which it was thought to prevent the city from undertaking the enterprise. A number of volunteer at- torne3-s and correspondents deluged bankers and newspapers with letters warning them against the bonds which the c\tj proposes to issue, on the ground that it had no right to issue them. The Mail and Express received several communica- tions of this kind." "Isot only the financial centres of this country," say the city's natural -gas trustees in their official report for 1890, "but tliose of Europe were invaded with these circulars."' The circular was headed "Caveat Emptor." It contained twentj'-four questions, and every one of the answers, except those which referred to matters of record and routine, like the date, amount, name, etc., of the bonds, was incorrect. AVhat hurt the people of Toledo most, as it was most base and base- less, was its attack on their hitherto unquestioned credit and financial honor. Asking the question, " How does the credit of the city stand?" the circular answered: "Refunding has been going on ever since 1SS3. The bonded debt was greater at the beginning of 1SS9 than of 18SS ; bonds bearing inter- est at 8 per cent, will become due in three or four years. Tlie mayor, in his last annual message, admits the inabilitv of the city to pay much of these except the refunding."' "Will- ing to wound, and yet afraid to strike,'' the authors of this attempt to pull down an entire city managed, by the inter- ' City of Toledo and Its Xatural Gas Bond?, pp. C-T. 2 Annual Report of the Natural Gas Trustees, 1890, p. 9. THB PEOPLE'S GEOLOGIST TAKES SIDES 329 weaving of such phrases as " ever since 1883," "bonded debt greater," "inability of the city to pay," to create by insinua- tion the feeling of financial distrust for which their greatest industry and ingenuity had been able to find not a particle of foundation. No modern municipality is asked or expected or desired "to pay much except the refunding." Capitalists would greatly prefer that even the refunding should not be carried on, but that the debt should run along; at the original high rates of interest, which they regretfully see dwindling away. The circular failed to state that the city was borrow- ing money at 4 per cent, to pay off debts bearing 8 per cent. The insinuations of the circular could have been used of "the credit" of the United States, New York, Paris, London, Chi- cago, with the same appropriateness — with this exception, that Toledo's municipal financial credit was relatively to its re- sources on a sounder and more conservative basis than these much more highly financed cities. The circular did not state that the proportions of debt to population had been decreas- ing for many years past.' " Toledo has not two years' supply of gas," the circular said, "in all the territory acquired." The State Geologist, in his annual report for 1890, said that Toledo would have no gas to supply its pipe lines or citizens in 1S91. In 1892 the city pipe line supplied gas to the value of $168,954.46. Three 3'ears have passed, Toledo wells still flow, and new ones are being found continually. "Whatever may have been his ob- ject," say the city gas trustees, "in volunteering such a state- ment, we know that so far in 1891 it is untrue, and that such positive declarations, based upon hypothetical conditions, are utterly unworthy of scientific pretensions." ^ The State Geologist also took part in his annual report in the debate between municipal control and private enterprise, siding alto- gether with the latter. The quantity of gas land owned by the city was put by the circular at 300 to 500 acres. The city had 650 acres. The ' City of Toledo and Its Natural Gas Bonds, p. S. 2 Toledo Natural Gas Trustees' Report, 1890, p. 7. 330 HIGH FINANCE circular declared the life of an ordinary well to be one to three 3'ears. There is no such limit. Referring to the quan- tity of gas land the city had, the circular asked and answered : " Cannot other territory be acquired ? "Not in Nortiiwestern Ohio, and not nearer than the gas fields of Indiana." This was untrue, for the gas trustees had already been offered, as stated, several thousands of acres of the best gas lands in addition to those they had bought. But the aiathors of the circular did their best to make it true. The city's natural-gas trustees say in their report for 1890: "As soon- as the trustees were prepared to negotiate for gas wells and gas territory, the field swarmed with emissaries and agents of the jSTorthwestern Ohio ISTatural Gas Company to com- pete with the trustees. In order to prove what had been pre- viously stated, ' that Toledo could procure no gas territory,' no means were left untried ; agents of that company even fraudulently represented themselves to the owners of gas property that the}' were connected with the gas trustees and working in their interest, and in some instances introducing themselves as the president of this board. Prices went up 1000 per cent, in some instances rather than let it fall into the hands of the trustees. A conspicuous ofiicer of that com- pany, as an excuse for paying an enormous sum of money for a gas well, is reported as saying, ' We did not want the gas well, but we had to buy it in order to keep Toledo from getting hold of it.' " ' Referring to the private companies, '• Are the people of the city already supplied with natural gas for public and pri- vate use?" the circular asked. "They are," it answered, and goes on: "Why does the city want to go into the natural- gas business, then V "To boom the lands of real-estate spec- ulators." This is a charge affecting the Legislature and Exec- utive and State courts of Ohio, the courts of the United States, the people of Toledo, and all the members of their ' Aunual Report of the Katural Gas Trustee 1890, p. 8. SUITOnS WHO DID NOT WANT DECISIONS 331 city government. Burke confessed that he did not know how to draw np an indictment against a whole people. That art lias been acquired since his day. "Are tliese bonds of unquestionable validity?" this cate- chism of libel upon a community queries. " By no means. Prominent taxpayers have suits pending attacking the constitutionality of tlie act under which they are issued." " Have these cases," the last question ran, " ever been tried on their merits ?" " They have not." They had been tried so far that the United States and State courts had refused on every ground urged to interfere with their issue and sale, declaring the legislation authorizing them to be valid. They had never been tried any further in the United States courts for a very good — or bad — reason. The " prominent taxpayers," after their defeat before Judge Jack- son, took every possible means to prevent the case from reach- ing a final adjudication. The invariable rule of the United States Supreme Court has been to treat as final and conclusive the decisions of State courts as to such domestic issues. Dur- ing the hundred years of its existence not a case can be found in which that court has overruled the fixed and received con- struction given to a State law by the courts of that State.' The only hope for the suit of the " prominent taxpayers " was, therefore, that the Supreme Court of the United States would for their special profit reverse the practice to which it had consistently adhered since the establishment of the gov- ernment. What they really thought of their prospect of suc- cess in that effort they confessed when their case, no longer delayable, was upon the point of being reached. They who had been so "anxious to get to the case as soon as possible " refrained from printing the record, a condition prece- dent to putting the case on the docket of the United. States Supreme Court. The city wanted the decision, and in order ' " Constitutional History as Seen in the Development of American Law." Lect- ure by D. H. Chamberlain. G. P. Putnam's Sous, New York. 332 HIGH FINANCE tliat the case might not be dismissed for this failure to print tlie record, and a decision upon the merits be thus prevented, tiie city's gas trustees advanced the money — $1100 — to the court printer for printing the record. Pushed tlius against their will to trial, wlien tiie day came on which they must rise to state their case the opponents of Toledo folded their tents and stole silently awa^'. On the motion of their attor- ne}' the case was dismissed, against the protest of the city. Tiiey paid all tlie costs, including the money advanced by the city for printing the record. To their defeat all along the line they did not want to add a formal decision against them from the Supreme Court, which was inevitable. And they ran away to tight another day. Another purpose of tliese suits was confessed only a few weeks after this circular was issued. The existence of the suits was used to try to frighten the city's natural -gas trus- tees into accepting a " compromise." The compromise was that they should abandon the enterprise, sell out pipes and lands for a fraction of their worth, get their gas from the private company at higher rates, and put the city in its power for all time to come. "It will be three or four years before your case is tliroiigh the Supreme Court," its representative told the natural-gas trustees, in urging them to accept. " You can't sell your bonds," he continued; "you have no money." The "compromise" was refused, but the cit3''s pipe line had been delaj-ed so long that the profits of the corapanj' for another twelvemonth were secure. The demonstration against the bonds in the United States Circuit Court had been followed by similar suits in the State courts. Here again the city was successful. It was upheld on every controverted ground — in the enabling act, in the vote of the people, in the appointment of the trustees by the gov- ernor, and in the issue of the city bonds. Appeal was taken here, as in the United States courts, and, as there, for delay, not for decision. To checkmate further use of this lawsuit to smother the law and cripple the city, the friends of the pipe line began a suit against the authorities to force an immedi- AN INCORRWPTIBLE EEPRESENTATIVE 333 ate decision from the Oiiio Supreme Court as to the legality of the bonds. It was certainly, as was said in the press, " a enrious state of things when the defendant is compelled to bring suit against liimself because the plaintiff refuses to allow trial in his own case." These litigations, tlie circulars, the press, were only part of the campaign. One of the committees of the Common Council was brought nnder control, and induced to tiirow technical difficulties in the way of the sale of the bonds, wbich caused months of delay.' Effort was made to get the Governor to appoint natural -gas trustees hostile to the city, but failed. It was attempted, also without success, to get the Legislature to prevent the sale of the bonds at private sale. During all this controversy the city was most fortunate in receiving the needful authority from the State Legislature. This was due mainly to a faithful and able representative of Toledo in that body, the Hon. C. P. Griffin. He was offered every promise -of political preferment and other allurements to betray his constituents, but he always remained faithful. Without his support the efforts of the city would have failed. His services amid great temptations deserve the grateful re- membrance of the public. Some of the devices of "private enterprise" were childisii enough. "A Business Men's Protest" was published, which proved under the microscope to have been largely signed by men whose names could not be found in the directory. A similarly formidable-looking remonstrance against the pipe- line bill was sent to the Legislature. It had 1426 names; of these 464 could not be found in the director}', and over 300 of the 962 remaining names signed the petition for the city's bill. Many of them avowed that when they had signed tiie "Remonstrance" it had a heading in favor of the pipe line, which must have been changed afterwards. As part of the tactics of misinformation, a report was published — in January, 1890 — claiming to give the business of both the private com- > Report of the Toledo Natural Gas Trustees, 1890, pp. 8-9. 334 HIGH FINANCE panics ; but the members of the Council Committee on Gas, when afterwards examining the books for the gas companj', found that it gave the receipts of only one company. A paper was prepared by a citizens' meeting for circulation among the manufacturei's to ascertain how much they would contribute towards the city pipe line; bnt when reported back to tlie meeting it had become, in some mysterious way, a paper asking the manufacturers how mucli they would ad- vance to quite a diflEerent scheme, the efEect of which would be to sell out the city pipe line or convert it into a manufact- urers' line. These were the infantile methods of men who could not see the ludierousness of the position they put themselves in by such efforts to keep a business which tliey were constantly declaring to be hazardous and unprofitable. Detectives appear in almost every scene of our story, and are as common in its plot as in any extravagant melodrama of the Bowery thirty 3'ears ago. To counteract the anonymous circulars the City Council sent a committee headed by Mayor Hamilton — the " War Mayor," one of the ablest lawj'ers of the cit}', upright and loyal at all times to Toledo — to visit the Eastern money-markets. The committee, in their official re- port, state tiiat they were assured by responsible dealers in municipal securities in Kew York and Boston that they would bid for the entire amount to be sold. ""We regret, however, to have to report that the powerful and influential parties who have on all occasions and in every way sought to obstruct and defeat the enterprise for which the proceeds of these bonds were to be used, in some way succeeded in inducing those who intended to purcliase to withhold their bids — in fact, no matter how guarded our movements, we believe that every person or firm with whom we had interviews was reported to the agents of the Standard Oil Company, for in every instance where from our interviews we had encouragement that the bonds would be bid for, within a short time more or less in- fluential agents of opponents interviewed these parties and succeeded in changing their minds." DETECTIVES AT EVERY BANK DOOR 335 What a picture of " high finance," of the " beneficent inter- play of the forces of snpply and demand," of the " marvellous perfection" witli which capital moves under "natural laws" to carry its fertilizing influences where they are most needed! The officials of this free city compelled to sneak around in the open raone^'-market under cover with "guarded movements," seeking buyers for its bonds as if they were stolen goods ! About them a cloud of spies and detectives reporting every movement as if it were a crime to the little handful of trust millionaires in their grand building on Broadway! "They have entered the Bank !" " They have just left 's office!" After each report the leash is slipped of a waiting sleuth, who flies away to run down the quarrj'. The gas trustees made public a letter and telegram they received from a prominent New York bank : "New Tokk, November 27, 1SS9. "Deak Sir, — A gentleman named " (naming a man who signs tlie cer- tificates of tlie Standard Oil Trust as treasurer),' " introduced by tlie card of Mr. " (one of the richest men in New York not otherwise known as connected with the trust), "called on us to-day and stated that under- standing that our firm was on the point of bidding on the Toledo bonds, etc., he would caution against the purchase, as they were not legal. Mr. represented himself as coming from '' (one of the companies of the oil combination), "and referred us to their lawj'er for further informa- tion. In ow as this maj' hurt the sale of the bonds we want to be cautious, and on Frida)' will make further inquiries, and will wire you accordingly. We may not care to hand in our bids on this account." The telegram sent on Friday is as follows: "New York, NoTember 30th. " Fearing sale of bonds has been Injured, will not bid at present." "That tells the story," said one of the trustees, "in a nut- shell." A local bank bid for §500,000 of the bonds, but did not sustain its bid. A reputable citizen, an ex-mayor, wrote for publication in one of the leading journals that he liad been ' Trusts, New York Senate, 1888, p. 659. 336 HIGH FINANCE informed bj a well-known banker there was reason to believe a bauking firm which, in 1892, defaulted on its bid for bonds, had been indemnified by the opposition for the $5000 it thereby forfeited to the cit^', and for the profits it would have made from the sale of the bonds. With the city line crippled the gas company would pocket the profits on the sale of a million dollars' worth of gas a year. Five thousand dollars, or several times that, was a small insurance to pay for such a gain. This was the game of hide-and-seek plaj-cd in "Wall Street by detectives and financial stilettos against "simple greens," who thought supply and demand still rule values. This was the reality which the officials of Toledo found behind the outward aspect of its magnificent buildings, the benevolent millionaires who look out through their plate-glass, the gran- diloquent generalizations of professors about "the money- market." The city was brought to the humiliation of seeing its ofii- cials meet in public session at an appointed hour to open bids it had invited from all the money centres for its bonds, only to have the news flashed all over the country that not a bid from abroad had been made. This opposition cost the city in one way and another not less than $1,000,000, according to the estimate of the city's natural-gas trustees. The feel- ing of the people was expressed in the following language in a circular sent out with the pamphlet report of the com- mittee appointed in mass-meeting to make a statement of To- ledo's case to the public : "'We have seen the modern aggregation of corporations — trusts — suppress other corporations in the same line of busi- ness. But this Toledo contest is believed to be the first in- stance where private corporations — creatures of the State — have assumed to exercise monarchical powers over a portion of the State — one of its leading municipalities; to dictate the policy of its people ; to seek to control the legislation as to the laws that should be enacted for such portion of the State • to bribe and intimidate the votes of such city at the polls; to OWNED BY THE OIL TRUST 337 attempt to subsidize tlie press by the most liberal expendi- ture of money; to at last purchase, out and out, a hereto- fore leading paper of the city, place its own managers and attorneys as directors, import one of its long-trained men as editor, and turn this paper into an engine of attack upon the city, an attack upon the city's honor and credit, characterized by the most unscrupulous misrepresentation and a perfect abandonment of all the amenities of civilized warfare." The Toledo public felt no doubt as to who were attacking it under the convenient anonymity of the two gas corpora- tions. At a public conference, January 16, 1889, between the presidents of the private natural-gas companies and the people assembled in mass-meeting, the representative of the former said the only condition on which the members of the oil trust had been induced to interest themselves in natural gas in Northwestern Ohio was that of absolute and unqualified control of the entire business thi-ough a majority of the stock of all the gas companies to be organized. " The trust is interested in companies engaged in supplying natural gas ?" the president of the oil trust was asked by the New York Legislature about this time. " To a limited extent, yes." " Have they a majority interest in any of these companies?" " I think they have." ' This was identically the arrangement by which the nine trustees owned as their private propert3' the control of the oil business. At several later conferences with the city's trustees and the Common Conneil the gas companies were represented by one of the principal members of the oil com- bination, the ingenious gentleman who had managed the ne- gotiations with the railroads by which, under the alias of the American Transfer Company, the trust claimed and got a re- bate of 20 to 35 cents a barrel," not only on all oil it shipped, but on all shipped by its competitors. He was also its rep- resentative in the similar arrangement by which the Cleve- I Testimony, Trusts, Xew York Senate, 1SS8, p. 423. = See p. 99. 22 338 IIIGS FINANCE land and Marietta Railroad agreed to carry its oil for 10 cents a barrel, to charge Eice 35 cents, and to pay it 25 out of every 35 cents Kice paid.' He bad acted in the same in- terest thronghout the gas field as well as in oil, and bis path- way could be traced through one independent company after another, whose wrecks, like those in oil, are milestones. July 27, 1889, in an item originating in !New York, in the Tribune, a friendly paper, and given an extensive circulation by news despatches sent to the leading papers in other cities, it was said that the representatives of the oil trust " in this city say emphatically that they will attack in the courts the right of the city to issue them " — the bonds. At the great meeting of the citizens, October 19, 1889, to organize a popular subscription to take the bonds killed in the money-market, the resolutions named the oil combination as the power responsible for the attacks on the city, and appealed to the people to observe that it, "no longer content with destroying individuals and associations wliich stand in the wa}' of its moneyed interests, now rises to grapple with and destroy the rights of cities and states; we therefore ask all liberty -loving men to make common cause with us in the defence of the community against the aggression of colossal power." The aldermen and the Common Council of Toledo unani- mously adopted resolutions, September 15, 1890, requesting the State and Federal courts to give decisions as promptly as possible in the suits pending against the validity of the nat- ural-gas bonds. These bodies in their official utterance de- clared that the oil combination, " through its officers and agents in the city of Toledo and at many other points in the United States, has circulated false and malicious statements about the bonds of the city of Toledo issued for natural-gas purposes." The natural-gas trustees of the city say in their report for 1890: "These injunctions and circulars, although fathered in the first instance by non-resident taxpayers, and ' See p. 20G. THE PEOPLE TAKE THE BONDS 339 in the second by irresponsible or anonymous parties, were traced directly to the oil trust, a trust having a large number of corporations within its control, among which is the North- western Ohio Natural Gas Company, and to whom tlie city of Toledo may reasonably attribute a loss of more than a mill- ion of dollars alreadj'. What further financial embarrass- ment it may suffer in the future cannot be measured by the depravity and moral turpitude which its seeds have sown in our midst." ' When the warfare against Toledo became a scandal ringing throughout the country and beyond, the organ of the trust in Toledo attempted to make it appear that the oil trust was not the party in interest. But there was open confession on the record. Its connection and its control were admitted by two representatives in conference with a committee appointed by the mayor at their request to discuss the situation." They described the circumstances under which the members of the oil trust had gone into the project of the Toledo line and the project of the natural-gas business. One of the two stated that he came into it as its " more direct representative." The pipe line of the private gas company was built, he went on to say, by one of the principal corporations in the oil trust. At the same interview it was admitted tliat the oil trust owned 60 per cent, of the natural-gas compan3''s stock. The people of Toledo did not surrender to this success of their enemies in the money-market. The bonds which cal- umny and espionage prevented them from selling at whole- sale to the great capitalists of New York and Boston they took themselves at retail. The Legislature having given au- thority for such sales, a committee of one hundred had been appointed by the citizens' meeting, October 19, 1889, to can- vass all the wards of the city for subscriptions to the gas bonds. "Gas Bond Pledges" were circulated, to which peo- ple subscribed according to their abilitj^, in amounts ranging from 82 to $5000. The employes at the Wabash Railway's ' Annual Report of Natural Gas Trustees, 1890, p. 9. » Toledo Blade, February 7 and 27, 18S9. 340 BIGU FINANCE car shops sent in a list signed hy fifty names for a total of S1102, an average of $22 each. Tlie labor of two hundred men for a week without pay was offered the gas trustees as an earnest of the good-will of the people. Piece by piece the city's pipe line was pushed through. At a critical moment a shrewd and patriotic contractor saved the enterprise by build- ing a large pai-t of the line, and taking for his pay the bonds the banks would not take. In June, 1890, the public were gratified b}' the announcement that their trustees had secured the means " for the construction of three miles more," making eight miles in all, or nearly one-fourth the entire line. In August a contract was made for five miles more, and so the work went on, step after step. CHAPTER XXV A SUNDAY IN JUNE In the midst of the anxious discussion by the citizens of Toledo as to the cliaracter of the power whicli ruled them both by night and b}' day, the same question arose in the metro- politan religious press, but in its broader ethical aspects. After the petition of Toledo to be allowed to take the control of its light, heat, and power into its own hands had been laid before the Legislature, the National Baptist of Philadelphia, in an article on the trusts, criticised them as the prophet Nathan would have done. It gave to that in oil, " of course, the bad pre-eminence in all this matter." "This corporation has, by ability, by boldness, by utter unscrupulousness, by the use of vast capital, managed to control every producer, every carrier, to say nothing of the legislatures and courts." The Exami- ner, the leading religious weekly of the Baptist denomination in ISTew York, rose against this. "We can readily understand how there should be differences of opinion in the matter of these trusts, and their influence is a proper subject of dis- cussion ; but to make it the occasion of so unjust and in- temperate an attack on Christian men of the highest excel- lence of character is something that was not expected from a paper bearing such a name. The four most prominent men in the oil trust are eminent Baptists, who honor their relig- ious obligations, and contribute without stint to the noblest Christian and philanthropic objects. . . . All of them illustrate in their daily lives their reverence for living Christianity." The National Baptist did not submit to this attempt to cite men's creeds to prevent judgment on their deeds. It quoted the replj' Macaulay makes Milton give to the similar 342 A SUNDAY IN JUNE pleas urged for King Cliarles : "For his private virtues they are beside the question. If he oppress and extort all daj--, shall he be held blameless because he prayeth at night and morning ?" It held to its ground, and cited against the trust the recorded evidence, but it declared it was "a marked breach of propriety for the Examiner to bring their private character into the discussion." The National Baptist, going on to speak in praise of a series of lively cartoons in Harper'' s Weelcly on the Forty Thieves of the Trusts and similar sub- jects, said, with some sadness : " It will be a sorry spectacle if the secular papers shall be ranged on the side of justice and the human race, while the defence of monopoly shall be left to the so-called representatives of the religious press." Later, March 20, 1S90, the Examiner returned again to its discussion of the religious performances of the chiefs of the oil trust as a matter of public importance. Of one of them it said: "The prayer-meetings of the Fifth Avenue Church are on Wednesda}' evening, and no business man in the church is less likely to be absent from one of them than he. His wife and children, when they are in the city, come with him, and it is by no means an unusual thing for the whole family to take part, each of them occupying one or two minutes of time. He and they are at church every Sunday when in the cit}', and no husband and wife keep up the good old 13aptist habit more faithfully of exchanging a kind word with the brethren and sisters after the regular services are over. He dresses plainly, and so do his famil}', and ever}- one of them has a kind heart and a pleasant word for all. They are among the last to leave the church and the prayer-meeting. Now the question is, How is it, as things go, that a man possessing the great wealth imputed to him should have so warm a frater- nity of feeling for the lowly in their temporal conditions ? And is there not an example here that might well be imitated in all the churches of our Lord V In an address on Corporations the reverend secretary of the Church Edifice Department of the Home Missionary Depart- ment of the Baptist Church followed the example of the lead- ORTHODOXY OF MONET 343 ing Church journal. " The oil trust was," he said, " begun and carried on by Ciiristian men.' They were Baptists, and', so far as the speaker knew, both the objects and the methods of the oil trust were praiseworthy." A clergyman of another denomination once called upon one of the great men of the trust to seek a subscription. "But," said the rich man, "I am not of your Church." "That does not matter," said the minister, "your money is orthodox." The secular press followed the example of the religious press in treating their public faithfulness to Church ceremo- nies as news of the day, and part of the record of their social functions. The New York correspondent of the Philadelphia Daily Record wrote for the people of Philadelphia : " It is not often that a millionaire stands up to lead in prayer, but I heard the president of the oil combination make an excellent prayer the other evening. He is said to be worth §25,000,000, but he neither drinks nor uses tobacco, and he is a deacon in Dr. Armitage's church. He likes a fast horse, and lias eleven horses in his stable here. Few men, however, lead plainer lives than he, and few put on less style. He gives liberally to unsectarian charities, but, he saj-s, ' when it comes to Church work I always give to the Baptists — my own denomination — and to no other Church.'" A New York daily described the same trustee "as one of the few millionaires who devote much of their time to the improvement of the condition of others. When not called awa}' by social or business engagements, j-ou are prettj' sure to find him at home evenings. Here, in his costly and well-equipped library, he receives his visitors, many of whom represent the various benevolent and religious un- dertakings in which he is interested. He has for years been a hearty snppoi'ter, financially and personally, of foreign-mis- sionary work, and no layman, perhaps, is so well informed concerning the details of it. He has a personal acquaintance •with many of the leading missionaries of the world, and his > New York Sxm of March 31, 1891. 344 A SUNDA Y IX JUNE residence is frequently the scene of a gathering of these work- ers among the heathen. He is now devoting considerable at- tention to home-missionary work, a field which, he is convinced, presents splendid opportunities for Christian endeavor." Manj' descriptions have been given by the press, metropoli- tan and interior, of the success with which one of tlie trustees built up the largest Sundaj'- school in his cit}' at the same time that he was building up the monopoly — leading the chil- dren of his competitors and customers to salvation with his left hand, while with his right he led their fathers in the oppo- site direction financially. The church where these men appear has had columns of admiring description in the leading daily papers of ISTew York and other cities. " There are few wealth- ier congregations than tffis one," says a reporter of the New York World, though he adds, "the wealth is elsewhere more evenly divided." The trustee of the light of the world " is the magnate of the church, the centre around which all lesser millionaire lights revolve. Everj'body stops to speak and shake hands with him. Everj'body smiles upon him, this mod- est man of nearly $200,000,000." " It is amusing," says the Brooklyn Eagle, " to note the manner in which his neighbors watch him during the service. Quite a number of people loiter near the door to see him as he walks out of church." "They are worth a bit of careful study," says another paper of the trustees, "and no place is quite so convenient as when they are at church. Their interest in religion is as sincere as their belief in oil. From the moment they enter church until they leave they are examples that Christians of high and low degree might follow with profit." " They have made the most of both worlds," writes another journalist. The oil trust was criticised by the Rev. Washington Gladden at Chautau- qua, in 1SS9. One of its prominent officials, as reported in a friendl}'' journal, defended it as "'a sound Christian insti- tution ; and all these communistic attacks are due entirely to the jealousy of those who cannot stand other people's pros- perity."' ' New York Tribune, April 23, 1SS9 "FROM WHOM ALL BLBSSINOS FLOW" 345 "In Anniversary week" in Boston, in Maj', 1889, at the meeting of the American Baptist Education Society, the sec- retary said he had an announcement to make. " It had been whispered about," says tlie New York Examiner of May 23, 1889, from whose friendly account we are quoting, " that something important was to occur at this meeting, and a breathless silence awaited the announcement. Holding up a letter, the secretary said that he had here a pledge from a princely giver to our educational causes, naming him (here he was interrupted by a tremendous cheer), of $600,000 for the proposed Chicago college. . . . This statement was fol- lowed by a perfect bedlam of applause, shouts, and waving of handkerchiefs. One brother on the platform was so excited that he flung his hat up into the air, and lost it among the au- dience." Eloquent speeches at once overflowed the lips of the leading men of the meeting, which was a delegate assembly. They sprang to their feet, one after the other, and mutually surpassed each other in praising God and the giver of this gift, which was equal to his income for a fortnight. " I scarcely dare trust m^'self to speak," said a doctor of divinity. " The coming to the front of such a princely giver — the man to lead. ... It is the Lord's doing. ... As an American, a Baptist, and a Christian I rejoice in this consummation. God has kept Chicago for us ; I wonder at his patience." Another reverend doctor said: "Tlie Lord hath done great things for us. . . . The man who has given this money is a godly man, who does God's will as far as he can find out what God's will is." The audience rose spontaneously and sang the Doxology. On motion the following telegram was sent, signed by the president of the society : " Boston, May 13, 1559. "The Baptist denomination, assembled at tlie first anniversary of the Education Society, have received with unparalleled enthusiasm and grati- tude the announcement of your princely gift, and pledge their heartiest co-operation in the accomplishment of this magnificent enterprise." The name signed to this telegram happened to be the same as that of the divine with whom, when president of Brown 346 A SUNDAY IN JUNE University in 1841, one of the most devoted of the laborers for the freedom of the negro had a discussion which is per- haps the most pungent in the literature of the antislavery movement. On August 30, 1841, Henry C. Wright -wrote to Edmund Quincy : " I once met the president of Brown University, in tlie presence of several friends, to converse on the subject of slavery. The conversation turned on the question : Can a slaveholder be a Christian ? To bring it to a point, address- ing myself to the doctor, I asked him, 'Can a man be a Christian and claim a right to sunder husbands and wives, parents and children, to compel men to work without wages, to forbid them to read the Bible, and buy and sell them, and wlio habitually does these things V ' Yes,' answered the rev- erend doctor and president, ' provided he lias the spirit of Christ.' ' Is it possible for a man to be governed by the spirit of Christ and claim a right to commit these atrocious deeds, and habitually commit them?' After some turning he answei-ed, 'Yes, I believe he can.' 'Is thei-e, then, one crime in all the catalogue of crimes which of itself would be evidence to you that a man had not the spirit of Clirist?' I asked. 'Yes, thousands,' said the doctor. 'What?' I asked. 'Steal- ing,' said he. ' Stealing what, a sheep or a man f I asked. The doctor took his hat and left the room, and appeared no more." ' The Sunday following a special service was held in the churches throughout the country in behalf of further help in " the new educational crisis." Many eulogistic sermons were preached that day by the leading clergymen of the denomina- tion. " And so," one of them is reported to have said, " when a crisis came God had a man ready to meet it. . . . An in- stitution was bound to come, and unless a God-fearing man established it it was likely to be materialistic, agnostic. ... In this emergency, and in God's providence, society raised up a man with a colossal fortune, and a heart as large as his fort- ' From Life of William Lloyd Garrison, Told by His Children, vol. iii., ch. i., p. 12, TEE JUBILEE MEETING 347 Tine." " God," said the Chicago Standard, a reh'gious weekly, " lias guided us and provided us a leader and a giver, and so brought us out into a large place." Another of the trustees has poured into a Southern State hundreds of thousands of dollars for churches of various de- nominations, and millions for hotels of a more than Oriental magnificence. "There is no philanthropist," says an editor of tliat State, commenting on these expenditures, " who ren- ders the world greater service than the man of enterprise." But "Western Pennsylvania," said the Pittsburg Pos^, "looks more with awe than pride at the liberal diffusion of its wealth in Florida improvements and Baptist universities." A daily paper of Bichmond, Virginia, in an editorial commenting on a report that the hostlery glories of St. Augustine were to be repeated in Bichmond, said : " "We have naught to remark on the tyrant monopoly if some of its profits are to come in such a direction. We could forgive much that monopoly visits on the down-trodden, horny-handed son of toil if it would come with open pockets proclaiming the era of luxuriant accommo- dations for all those other millionaires whose money we want to see invested in Bichmond." The next year after the Boston meeting the Church cele- brated its "Anniversary week" in the city which was to be the seat of the new college. And the anniversary closed with a jubilee meeting, which filled the largest assembly room in America. " All the church-going people of Chicago must have attended," one of the daily papers said. It was addressed by the principal clergymen of the denomination from all parts of the country. Again, as at Boston, the centre of interest was the gift of a fortnight's income to the university. A telegram making the gift conclusive, since the conditions on which it was promised had been complied with, was read. Cheer after cheer rose from tlie assembly, and oratory and music expressed the emotion of the audience. The divine who made the closing speech declared that he needed ice on his head on account of the joyful excitement of the occasion. The cheers and the hand-clapping closed again, as at Boston, with the spirited sing- 348 A SUNDAY IN JUNE ing of the Doxology. Not only in the religious press of all denominations, but in the worldly press, the topic was the best of " copy." The great dailies gave columns, and even pages, to the incident, and to the subsequent gift from the same source of larger sums. "Conspicuously providential," "princely," "grand," "munificent contribution," "man of God," were the phrases of praise. A writer in the New York Independent said : "Your correspondent speaks from opportunities of per- sonal observation in saying that pecuniary benefaction to a public cause seldom if ever, in his belief, flowed from a purer Christian source." The only recorded note of dissent came from a humbler source. Under the text, "I hate robbery as a burnt-offering," a weekly business journal said : " The en- dowment of an educational institution where t!ie studies shall be limited to a single course, and that a primary course in comu:ercial integrity, would be a still more advantageous out- let for superabundant capital. Such an institution would fill a crying want." It was the last Thursday in Maj', 1890, when this great rep- resentative convention of the Church from all parts of the United States celebrated the acceptance of this endowment. Even while the roll of the Doxology was still rising to the roof of the auditorium the plans were preparing for a per- formance at Fostoria the next Sunday, three days later, which had a profound effect upon Toledo, though just the opposite of what was expected. Fostoria, Ohio, is the home of the president of the princi- pal natural-gas company in Ohio controlled by the oil trust and leader in the vendetta against Toledo. A wealthy miller erected in Fostoria in 1886 a flouring-mill, with a capacity of 1000 barrels a day. One of the inducements was a contract made with this manufacturer bj^ the gas company, by which it bound itself to supply him with natural gas at a price which woiild be one-fifth what coal would cost him, and to continue to supply him as long as it supplied any one. The manufact- urer carried out his agreement by the expenditure of $150,000 for the erection of the mill, and by running it continually to A SUNDAY SERVICE 349 its full capacity. His bills for gas he paid promptlj' evei-}' month. Eelying upon the contract with the gas company, the mill was built for natural gas, and could use no other fuel. In February, 1890, the gas company, dissatisfied with the bar- gain it had made, demanded better terms. The milling com- pany refused. On a Sunday morning in June, "when, if ever, come perfect days," a gang of men appeared, led by an officer of the gas company, and dug up and tore out the pipes supplying the mill with gas. Church bells of different denominations were scattering their sweet jangle of invitations to the sanctuary as the tramp of these banded men, issuing on their errand of force, mixed with the patter on the sidewalks of devout feet. Pri- vate grounds were unlawfully entered, property was destroyed, the peace broken, a day of love changed to one of hate, all the bonds of community cut asunder, and the people turned from the contemplation of divine goodness to gaze at shapes of greed and rage. Sunday is chosen for sucli deeds, since the help with which the pagan law, gift of heathen Kome, would inter- pose, cannot be invoked by the victims on Sunday, and be- cause on Sunday Christian people go to church, and leave their property undefended. Tiie peace-officers were sum- moned to arrest the invaders for violating the Sunday law, but before tliey could get on the ground the mischief was done. The pipes had all been excavated, the connections wrenched off, and the trench nearly filled up. The milling companj' began suit for $100,000 damages against the gas company,' but a private settlement was made, and the case has never been pressed to trial. The laborers who did the work of the Captains of Industry in this matter were tried and convicted at the County Court in July, but by no process did the law, which is "no respecter of persons," reach out towards the principals. This Fostoria incident occurred during the heat of the To- ledo contest— June, 1890 — while the cit}' was pushing the ' Petition of the Isaac Barter •Company vs. the Kortliwestei-n Ohio Natural Gas Company, Court of Common Pleas, Seneca County, Ohio, June 16, 1S90. 350 A SUNDA Y JN JUNE sale of bonds for its emancipating pipe line by popular sub- scription and in odd lots. Notice had been already served on the people of Toledo at public conference, that despite con- tracts, chai'ters, franchises, the private companies would not take any less price from Toledo than they demanded. In pursuance of this, after the council had fixed the price in accordance with its admitted right, a circular was sent out containing this significant threat : " If it " — the legally de- clared price — " is approved by our customers we will know what course to pursue." Even before the occurrence at Fostoria it had been defi- nitely suggested to the people of Toledo that in case the council failed to accept the demand as to rates in making the new ordinance (July, 1890) the pipes would be so far removed as to cut off the supply on some Sunday when no legal help could be invoked. The possibility of this Sunday cut-ofE of the fuel supply of 15,000 consumers became a living topic of discussion, public and private, and was considered in all its bearings by the Toledo press. Calculations were made and published of the number of men it would require to take up the hundred miles or so of pipe in the streets of Toledo be- tween dark and dark some holy Sabbath da}'. It was con- fessed, hopelessly, that they would be more than the police could handle. " Of course," as was said in the Toledo Blade by a leading citizen, "such enterprise would involve a very remarkable degree of both lawlessness and despei-ation on the part of the managers. It would be a mode of withdrawal from trade quite unknown among sound business men. But then their processes have been peculiar from the start." It was nothing less than startling to Toledo, almost before the print on the types of these words was dry, to hear the news from Fostoria of the Sunday raid there. There were those who declared that the Sunday violence at Fostoria was deliberately done as a warning to Toledo. If it were a warn- ing to them not to insist on the legal and equitable and con- tract right of their Common Council to fix the rates of gas, it was a failure. The council went forward and did its duty. HOW TOLEDO TOOK THM WARNING 351 If it were a warning to the people to redouble their labors to free themselves forever from the possibility of snch thraldom as that in which Fostoria and other cities were enchained, it was a success. The people heard and heeded, and in ten months thereafter gas began to flow into the city through its own pipes. CHAPTER XXVI TOLEDO VICTOE It was remarkable to see the revival of the passion of free- dom of 1776 and 1861 in the editorials, speeches, resolutions of public meetings, and the talk of the common people in Toledo as in Columbus. The example of " the heroic liberty- loving people of Boston " was held up in every aspect to fire the heart of Toledo not to be frightened into subjection to the foreign power that threatened them. To resist " the domination of an economic monarchy" was the appeal made in posters with which the town was placarded. " During all the time George III.'s soldiers were quartered in Boston that monarch did not spend as much money to bring the city to terms as has been been spent in this effort to subjugate the city of Toledo," said Alderman Macomber. " A people like those of Toledo," said one of them in the press, "when once united and determined as they now arc, cannot be subjugated by any combination of mercenaries yet known." '•'It is evident," the Toledo Sunday Oazette said, " that the people of Toledo have come to a full realization of the truth that the money saved by the independent pipe line, though great, is a matter of little importance compared with the so- cial and political issues involved. It would be a thousand times better," it continued, "to utterly bankrupt the city than permit the oil combination to win. Tiie figlit was not for the present alone, but it was for the present and future, and for all time to come. It was not for the people of Toledo alone, but it was for the whole Union, though God had chosen the people of Toledo for the struggle." PUBLIC ENTERPRISE IN COMPETITION WITH PRIVATE 353 Tlie Cincinnati OommercidUGazette said, in its editorial col- umns ; " In itself the Toledo enterprise is not a big one, but it will prove an object-lesson for the whole country. It will show the open door through which people may pass from un- der the yoke of a most gigantic, unscrupulous, and odious mo- nopoly. And it will be surprising if this does not extend be- yond gas and ultimately cover oil. We are only on the verge of a revolution that is as sure to come as that which followed the throwing overboard of a lot of tea in Boston Harbor. Neither the power nor the vulgarity of capital can long rule the people." Numerous letters of sympathy, congratulation, and indig- nation were received by the Toledo committee appointed by the citizens' mass-meeting to make a statement of their case to the people of the United States. There were letters from chairs of political economy in the universities, from scholars and students in history and politics, and from men in affairs and finance. The completion of the line to the city was not the comple- tion of the enterpi'ise. Mains had still to be laid in the streets, and house connections made. At evei-y step, now as before, unrelenting opposition did all that could be conceived of — in the courts, the Legislature, the city government, the money-market — to block municipal self-help. Great numbers of the citizens desired to change from the private companies to the city. Over 7500 consumers were at one time, in 1891, calling upon the city to supply them.' The litigation which was kept up, and the defeat of the attempt of the city to sell its natural-gas bonds in the open market, had exhausted the funds at the disposal of the city trustees. But they showed a readiness of resource equal, with the help of the people, to all these emergencies, and proving that public enterprise can more than hold its own in the competition with private enter- prise. Contractors were got to pipe the streets by sections, and take for pay the pledge of the income earned by the pipes 1 Annual Report of the Toledo Natural Gas Trustees, 1891, p. 6. 23 354 TOLEDO VICTOR SO laid. In other cases people wanting the gas were willing to advance a part of the cost. The same contractor who had faitli enough in the city to build the main line from the gas- fields and take the bonds while they were under tire volun- teered in the same way to build the submerged lines across the Mauniee River, and ten miles of mains within the city. This was done at a moment when otherwise the enterprise must have come to a stop, and the name of this patriotic con- tractor is given to the public by the trustees in tl)eir annual report with words of gratitude. The amount of bonds originally authorized was $750,000. The trustees, in consequence of the delays and enhanced cost caused by lawsuits and other tactics of opposition, had to incur a floating debt of $300,000. The council by ordinance direct- ed the issue of bonds by the city to the amount of $120,000 to pay off part of this floating debt. The State Circuit Court refused to sustain this action of the council, but pointed out that all the city lacked was the authorization of the Legislat- ure. This was the only decision against the city in all the liti- gations, and in this the State Court was afterwards overruled by the United States Circuit Court. A bill was accordingly introduced, giving the city the right to issue $300,000 in bonds for the floating debt, and $100,000 for tlie extension of the gas plant: wells, pipes, pumps — whatever was needed. A strong lobby immediately appeared in the State Capitol to defeat the bill. As part of its ammunition a pamphlet was circulated among the legislators, giving "Facts and Reasons " why the Legislature should not authorize the new issue of bonds. This pamphlet illustrates the easy virtue with which some lawyers dispose of themselves to those who have the money to pay them. Two of its strongest points were that the contracts for which the floating debt had been incurred were let with- out proper competition, and that the trustees had no power to make the contracts. This pamphlet was signed by two lawyers, one of whom, before these contracts were let, had given the trustees his written opinion supporting such con- tracts unqualifiedly. The representatives of the people were A CRALLENOE NOT AOOEPTED 355 able to exhibit to the Legislature his written opinion stating that the trustees had the power to make the contracts, and had let them in compliance with the requirements of the statute as to bids. The pamphlet declared that the court, in granting the injunction against the issue of the $120,000 of bonds by the Common Council, had declared the claims which were to be paid by the proceeds of the bonds to be " illegal and invalid." This was untrue. The court had held only that the city had not the power to issue the bonds, and pointed out that the remedy was in new legislation by the State to remedy the want of power. Pursuing the tactics of defamation of the city and its au- thorities which had been used throughout this contest, the pamphlet said : " We are prepared to prove . . . that the con- tractors put in their bids substantially as gambling transac- tions, at such excessive price that they thought they could take the risk of the illegality of the natural-gas proceedings, trusting that these illegal transactions would be permitted to pass witliout question, or that subsequent legislation would ratify these illegal acts; all, or nearly all, of the contracts were taken at prices more than double the fair cash value for all the work and material provided for; and all the work and materials, the claims for which now aggregate about $350,000, could have been obtained in the open mai-ket, under valid laws, upon proper terms of payment, for less than §250,000. We have the evidence within our control to estab- lish that the work under some of these contracts was actually done for less than 40 per cent, of the amount named in the contract. In addition to these facts, we can establish, if per- mitted to offer evidence, that the certificates issued by tlie natural-gas trustees were, immediately after the conclusion of the contracts and before any litigation was had upon them, hawked about the streets of Toledo at from 60 to 75 cents on the dollar; and that the great majority of these certificates are now in the hands of speculators, who bought them at not to exceed 65 per cent, of their face value." T!ie authors of these statements were at once challenged 356 TOLEDO VICTOR by the city's gas trustees to prove tliem. " We assert," the gas trustees said, in a formal challenge, " that you cannot establish the truth of those statements. We deny that the facts are as you state them to be, either in substance or in detail." This was signed by John E. Parsons, W. W. Jones, Eeynold Yoit, J. W. Greene, gas trustees, and Clarence Brown and Thomas H. Tracy, ex-gas-trustees. The city's trustees proposed that thej^ and their accusers deposit $1000 on each side as a forfeit to abide the result of an inquiry by the three judges of the Court of Common Pleas, or any other disinterested arbitrators. They placed at the service of the accusers and the arbiters all the books, records, and employ^ of the city's gas department. The challenge was not accepted, and the authors of these attacks made no attempt to prove them. The Legislature disregarded them, and granted the city and the gas trustees all the additional power to issue bonds asked for. In a subse- quent proceeding in the Federal courts — the issue involving the validity of these certificates — it was admitted, contrary to these allegations, that tlie prices were fair, and tliat the con- tracts were entered into in good faith, and the court held the certificates valid. The most serious crisis in the contest was still to come. In 1S92 the gas wells of the city began to do what the people of the city will never do — surrender to the enemy. When the oil trust found, after j'ears of opposition in the Legislature, the courts, and the gas-fields, that it had been helpless to pre- vent Toledo from getting ample tracts of excellent gas terri- tory, with some of the largest gas wells in the field, and equal to tlie supply of the entire consumption, domestic and manu- facturing, it turned to other tactics. All about this territory secured by Toledo and found so productive the private companies of the trust proceeded to buy or lease and to sink wells. The trust shut off all its own wells, except those adjacent to the city territory, and for two years drew exclusively from the wells nearest those of the citv. When the city's line was completed to the wells the EXPLOSIVE AND EVANOMLICAL 357 volume of gas was found to be largely reduced. It had been drawn off into the wells of the opposition. In the spring of 1892 the private companies resolved to put in pumps to strengthen the diminished natural pressure, but to prevent the city from doing the same thing. Then, with their pumps alone at work, the pressure could be so much further reduced as to render the Toledo pipe line valueless. To this end all efforts were directed. The newspapers were kept full of matter showing how impossible it was to pump gas, that all the money expended in pumps would be just so much wasted, and that the companies had canvassed the matter fully, but abandoned the idea. Column after column of inspired inter- views filled the papers, all admonishing the city of Toledo not to commit such an act of folly as to put in gas pumps. Then application was made to enjoin the sale of the bonds author- ized by the council and the Legislature for pumps. So month after month dragged along. The bonds remained unsold, and the pumps unobtainable. The injunction was refused both by the Court of Common Pleas and by the Circuit Court. But there was a right of appeal to the Ohio Supreme Court until the beginning of 1892. Boston bankers had subscribed for a large block of the bonds, but withdrew upon learning these facts. " It is pos- sible for the contestants," the lawyers advised them, " to carry the matter to the Supreme Court. This, we understand, they propose to do." The simple assertion of a purpose to continue the litigation was enough to defeat the sale of the bonds. Tlie payment of costs and lawyers' fees would be a very moderate price to pay for compelling the city's gas plant to go past mid-winter without the pumps indispensable for its operation. One of the employes of the private pipe line, according to an account in one of the Toledo papers, de- clared to a reporter that "if we could not prevent the city from putting in a [pumping] plant any other way, we would blow it up with dynamite." ' ' See p. 250 and eh. xxxi. 358 TOLEDO VICTOR Any faithful employ^ familiar with the blowing up of der- ricks in the shut-down of 1887,' the explosion in the indepen- dent refinery at Buffalo,' and the "chemical war" waged by the whiske}' trust against the "outsiders" in Chicago' might almost be pardoned for thinking tliis was " only good, reason- able talk." The oil monopoly is evangelical at one end and explosive at the other, and it has made both ends meet. The people of Toledo were thus prevented from getting the pumping facilities ready during the summer of 1892 for the work of the winter. Meanwhile its rival had been secretly pushing pumps for itself to completion, in the hope that it alone would be ready when cold weather came. This would mean a gain to it, at the city's expense, of hundreds of thou- sands of dollars. Late in August, 1892, the representatives of the city found that two powerful duplex gas pumps had been shipped to the gas-field, and were being put in place by the very opponents who had declared pumps impracticable. Public sentiment became aroused to the need for the imme- diate purchase of pumps to protect their wells. The city attempted to use its income from the sales of gas to buj' pumps. An injunction was applied for and granted. This emergency was finally met by having the gas trustees hand over to the city authorities the accumulated earnings they were forbidden by the court to spend themselves. The city thereupon turned around and invested this money in the gas bonds. In this way the identical money the gas trustees could not use while it remained in their hands was made available to them by passing through the hands of the Sink- ing Fund Trustees, and coming back to them. Tiius tlie natural-gas trustees were enabled to make a contract in Sep- tember, 1892, for pumps to assist the flow of gas to the city. Tlie gas pumps are a patented device. The private com- panies, wanting all the profit of everything, had had their pumps made at their own factory. The city made its con- tract directly with tlie owner of the patents. The result was 1 See p. 154. 5 See p. 250. ^ See p. 21. PROFITS OF PUBLIC ENTERPRISE 359 that the city got its pumps in place in time to save tlie city pipe line, while its opponents were delayed by the inexperi- 'Cnce of their own pump-makers. This was the most critical period in our history. Greed had again defeated itself. Had the opposition gone to the owner of the patents he would have been unable afterwards to take the city's contract and complete it in time, and the effort to make the city line value- less would have succeeded — for the time being, at least. The bonds in question were afterwards held valid by the Supreme Court. Toledo knew it was building wisely, and every day brought new proof that it had builded better than it knew. Its saving was great, but tliat was the least of its gains. It escaped tyranny and extortion and other wrongs which fell upon communities in plain sight, which had not the wit and virtue to establish their independence. When the city pipe line was opened in 1891 the city began supplying gas to its cit- izens at 8 cents a thousand for houses. The private com- panies were charging 12 cents a thousand, or 50 per cent, more. Profits were such at this charge of 12 cents a thou- sand feet that in some tracts single wells would repay the cost of the land every four daj's and two hours, or eighty- nine times a year. Since then the private corporations have raised their rate to 25 cents. The city continued the rates at 8 cents until December, 1892, when the rate was advanced to 15 cents. This advance would have been unnecessary but for the losses arising from the obstructions placed in the way of the city plant. The people of Toledo got their gas lands, pipe line, and street mains for an outlay of §1,181,743 up to the end of 1891," and 81,294,467 up to the end of 1892. In the canvass before the election in 1889 their opponents declared that 84,000,000 would be required. Private enterprise cannot find rhetoric strong enough to express its contempt for the inefiiciency, costliness, and des- 1 Annual Report of the Natural Gas Trustees of Toledo, 1891, p. 4. 360 TOLEDO VICTOR potisms of public enterprise. Private enterprise put at $6,- 000,000 — twelve times the amount of the property they reported for taxation — the "capital" stock invested by the two natural-gas companies. The city pipe line was capital- ized (bonded) at just what it cost — a little more than a mill- ion. The city trustees built a better pipe line than private enterprise had laid. The private line was of cheap iron of 14-f eet lengths, while Toledo's was in 24-feet pieces. One of the private lines was laid with rubber joints and in shallow trenches, in many places of not more than plough depth. It leaked at almost every joint ; its course could be traced across the fields by the smell of gas and the blighted line of vegeta- tion. There were frequent explosions from the escaping gas; lives and property were much endangered. The city line was laid with lead joints, and had every device that engineer- ing experience could suggest for its success, and was so con- structed that it could be cleaned or repaired, and freed from liquids interfering with the flow of gas, without shutting ofE the supply — features the other pipe had not. The action of the city trustees had to endure the microscopic scrutiny of friend and foe. No one was able to show as to a single acre that the title was defective, or that it could have been bought for less, or to find any taint of a job in the construction of the pipe. A committee of the city council sat and probed for six weeks, but failed to find any evidence whatever to confirm the reported " irregularities." What Toledo will save in one year by tlie diflEerence be- tween the actual cost at which its people can supply them- selves and the price the private companies would have charged, to pay dividends on $6,000,000 of "capital," is only part of the story. The profit of the city enterprise is to be estimated by its competitive effect upon the charge of the private companies. These have been kept down in Toledo much below the average of other towns, wliere they have been as high as 35 cents a thousand. If the city had not supplied a foot of gas this check on the private companies would make its pipe line still a good investment. The people, when it is KEEPING THE MONEY AT HOME 361 in full operation, can pay the cost of the system complete out of the savings of a few years, then pay ofE tlie entire city debt, and have a large income left for public buildings, roads, parks. Or by reduction of price they can keep this sum in their pock- ets, where it will do quite as much for tiie general welfare as if it had been transferred to the bank accounts of non-resi- dents. The city, at the end of 1891, had 3299| acres of gas land. In March, 1892, forty-five wells were giving over 50,000,000 cubic feet of gas, equal to 3500 tons of anthracite coal. Its income from the sale of gas was at the rate of $20,032 a month in winter, and $10,221 in summer. An investigation made in March, 1892, by a committee appointed by the mayor at the request of the city's gas trustees, showed that an in- come could be counted on (§180,000) ample to pay all ex- penses (§128,120), including interest, rentals, and the cost of drilling new wells, and provide a small fund annually (S51,- 880) for the extinction of the bonded debt. The committee said : " We believe that if the gas plant is properly managed upon prudent business principles and methods, tliat it can be made a profitable investment for the city and her people; that the class who will derive the greatest benefit is the labor- ing class, who pay rent or taxes upon their little homes, and to whom the matter of ciieap fuel is quite an item in the total amount of annual expenses; and we believe it to be the duty of every good citizen to aid and encourage this class." These were the i-esults with a charge of 8 cents a thousand. Gas to the amount of $167,899 had been sold up to August' 1, 1892. Between ISTovember, 1891, and August, 1892, the city earned on the million invested the sura of §150,000, or nearly one-ninth of the cost of the plant, and this at the low price of 8 cents a thousand feet. Unobstructed by its ene- mies and at the price charged by the private companies, 20 cents a thousand, the city would pay for its entire plant in less than three years. To discourage the public from going forward with its pipe line the private companies " talked poor." In an inter- 362 TOLEDO VICTOR view in the public press the president of the principal com- pany said it had paid but 9 per cent, in dividends in two and a lialf 3'ears. Tlie net earnings were stated to be "about 4 per cent, per annum on the capital," $4,000,000;' for the smaller company they were figured out to be at the rate of a fraction less than 1 per cent, a year on its capital of $2,000,- 000.= "We feel sore and hurt about it," said the "direct representative" of the oil combination to the citizens' com- mittee ; " we have seen no good return from onr money." " It has pretty nearly swamped us," said the president of the company. The citizens of Toledo were shrewd enough to ask themselves how long their antagonists wonld have been likely to remain in a business which paid only 3 per cent., and was as " hazardous " and " shortlived " as they pictured it to be. Careful estimates made by close students of the ques- tion calculated that of the $6,000,000 of paper capital " in- vested" in the two companies which supplied Toledo and other cities, $1,125,000 was the proportion of actual cash de- voted to Toledo. The receipts upon this Toledo investment in the two and three-quarters years between the opening of the business and the date at wliich, by the contract with the city, the council was to make new rates (June 30, 1890), were, as nearly as can be calculated from the figures of their report, $1,300,000 greater than the expenses of tlie Toledo business. This is a profit of 115 per cent. In less than three years the total investment had been repaid by the profits, and, in addi- tion, enough to have paid dividends of 5 per cent, a j'ear. Tliis was an estimate, but it was an estimate publicly made from the companies' figures, and by a responsible man. It re- mained unchallenged at a time when every cranny of fact and fiction was being rummaged for missiles to fling at the people. When the citizens' committee sought a reduction in price, the companies pointed to the small dividend their stockholders had had. In the face of the fact that they had received but a 3-per-cent. dividend the previous year, no business man, ' Report to Stockholders, Northwestern Natural Gas Company, January '7, 1889. - Keport to Stockholders, Toledo Natural Gas Company, January, 1889. DiriDBNJ) IRRIGATION 363 their spokesman said, could ask thera to reduce their price. It is for such uses tiiat shrewd men "water" stock. The surface of the capital is broadened, so that even large divi- dends can cover it only by being spread out very thin. This 3 per cent, a year was on $6,000,000 of dilution, representing a solid, at the most, of only $1,500,000. The balance sheets of the companies showed that the companies had paid small dividends for the additional reason that a large part of their receipts had been reinvested in lands, wells, and extensions of the pipes and plants. The people are often assured that these false figures of cap- italization are merely romantic and do them no harm, because charges must be governed by the "laws of trade." One of the "laws of trade" that regulates the "market price" of such commodities as transportation, light, water, gas, f ui-nished b}' the help of the public franchises, is the power of the public to regulate. This public power depends upon the public knowledge and the public disposition. To make the public believe that the profit of serving it has been only 3 per cent, a 3'ear, when it has been nearer 50 per cent, is to manipulate public opinion, the most potent of all the " laws of trade," for a competing supply cannot be got easil}', often not at all. A committee of citizens were invited by the representatives of the gas companies to meet them to verify the statements of the companies as to the unprofitableness of the business, and the inexpediency of municipal self-supply. But when the committee wanted to know what had been the real cost of the private pipe lines, on the $6,000,000 nominal capital of which the people were expected to pay dividends, they could not get any satisfaction. Tlie companies would only give an estimate. To the request for more definite information, the reply of both companies was, " We have not got the books of the contractors; we have never had them. We have no means of knowing the actual cost of the Toledo plant, or any books to show it.' We have no papers or documents in ' See ch. xxsii. 364 TOLEDO VICTOR regard to the construction of tliis line." It came to light later that one of the companies in the oil trust had constructed the pipe line for the gas company, and at a price approximating the large figures claimed. Tiie company that built this pipe line is a ring within the oil and gas ring, always on hand for such contracts and at like margins of profit, and it is owned almost wholly by the principals of the combination." The people — mostly Ohioans — who took the minority 40 per cent, of stock of the gas company were really the "simple greens." All that was paid for this construction by those who were members both of the inside ring and the gas company came back to them ; their associates in the minority paid, but got nothing back. It was from the latter came the profits of this contract to the insiders. The people of Dayton had a similar experience. Their nat- ural-gas company demanded an advance to 25 cents a thou- sand, and met a committee of the people to prove that the demand was proper. But it would not let the people know what the actual investment was to make which good it sought to tax the people. The books containing the con- struction account were "not accessible." "The actual cost to construct the plant is what we most desired to know," the committee reported. As at Toledo, so at Dayton ; all private enterprise would let its customer-subjects know was what it wanted them to pay ; information to show what they ought to pay " was not accessible." What the profits were elsewhere can be guessed at from the fact that in Pennsylvania $36 a year was charged in most of the towns for cooking-stoves. In Toledo the charge was $19.50 a year. Almost every day after the pipe line had been decided on the people saw something done, showing how well found- ed their apprehensions had been. The power to discrim- inate in rates the people saw used by the private companies for selfish and anti-public purposes, precisely as they had fore- seen it would be. When the fight for and against the city ' See p. 113. BOOK-KEEPERS WHO KEEP NO BOOKS 365 pipe line was on, one of the gas companies sought to enlist the strong men in their support by making tliem special rates, pursuing the tactics of divide and conquer. Manufact- urers with influence useful in controlling public sentiment were conceded special rates. Others were given to under- stand that any lack of "loyalty" would be followed by pun- ishment. So e£fective were these alternating methods of boodling and bulldozing that the council committee on gas, in a subsequent investigation, found it almost impossible to obtain any information from manufacturers as to tlieir use of natural gas for fuel. What little they did secure was under injunctions of secrecy. The committee found that some were raade to pay twice, some three, and some even four times as much as was paid by neighbors for like service. The only rule for charging seemed to be to favor those who had " influ- ence." Tliis was using municipal franchise just as tiie f An- chise of the highways had been used in their behalf b}' the railways. An assembly of divines could not be trusted with such power over their fellows. After the Fostoria incident the people of Toledo had an- other illustration given them of how wisely they had build- ed. The gas supply of the people of Columbus, Ohio, was shut off arbitrarily and suddenly in midwinter — January, 1891 — and they were informed that the company would sup- ply them with no more gas unless the City Council would raise the price to 25 cents a thousand feet from 10 cents. The gas had not failed. The caverns that discharge gas at 25 cents a thousand will let it come just as freely at 10 cents. The council had fixed the price at 10 cents, and the company had accepted it. The demand for a higher price was close upon an increase in the capital stock of the Columbus com- pany from $1,000,000 to $1,750,000. More stock called for more dividends, and this was one way to get it — to strike this sudden blow, and then to say, after the manner of Silas Wegg, "Undone for double the money!" It was for the power to do this at Toledo, to preserve the power of doing it every- where else, that hell and earth were being moved in Toledo 366 TOLEDO YICTOK to prevent the people from serving themselves and setting an example to the rest of America. In the same way the gas was turned off at Sidney, Ohio, and not turned on again until, upon the application of the mayor, tlie company was ordered to do it by the courts. "There is a great deal of suffering here," the press reported, "and it is feared that several deaths will result from exposure." The people did not fail to comprehend the significance of criticisms in the Toledo organ on the municipal water supply. Monopoly must go on conquering and to conquer, or be over- borne by the ever-recuperating resentment which rises against it, freshened with each new day. Nature hates monopoly, says- Emerson. The studied attack on the city water works was believed to be meant to prepare the people to intrust that as well as the gas supply to the trust's "sound business men" and " private enterprise." Finding that the council would not bend to the demands as to rates, and that the people were too resolute to be in any way diverted from their pipe line, Toledo was given some such doses as could be ventured upon of the Fostoria and Columbus medicine. The company shut gas off from those who would not pay the increased rate. It deprived public institutions of their fuel. It refused to supply gas to a new public school whose building was planned for natural gas. As the city's pipe line was not completed, the children had to go cold. The winter of 1891-2 was the first winter the city's pipe line was in operation. With the first cold snap, at the end of November, great distress and danger were brought upon the people b}' a lawless act, done secretly' by some un- known person to tlie city's pipe line. One of tlie main pipes in the gas-field, through which flowed the product of two of the largest gas wells, was disconnected, so that its gas could no longer reach Toledo. Who did this was never discovered.' Defeat, final and irrevocable, crowned the unvarying series of defeat which the private companies had suffered every- ' See cli3. ix. and xxxi. ONE MILLION DOLLARS DAMAGES 367 where and in everytliing — in public meetings, in the Legislat- lu-e, in the gas-fields, at the polls, in the courts, in the sale of the bonds, and in the competition with the city. The City Council of Toledo, advised by its lawyers that it could recover damages from those responsible for the losses brought npon the city by the opposition to its pipe line, has had suit brought for that purpose. April 14, 1893, City Solicitor Head began proceedings to recover §1,000,000 damages from members of the oil combination and the various individuals who had been used as stalking-horses in the campaign. At the next meeting of the Common Council several citizens of the "influential" persuasion assisted the mayor in trying to coax and bully the council to abandon the suit, but without success. The council were threatened with a financial boy- cott to prevent the sale in future of any of the bonds of the city, but it refused to be terrorized. April 8, 1893, the natural-gas trustees of Toledo had the hap- piness of being able to give formal notice to the city auditor that no taxes need be levied to pay the interest on the gas bonds, as it " can easily be met from the revenues derived from the sale of natural gas." The city pipe line was on a paying basis at last. Toledo had vindicated its claim to be a free city. The completion of the enterprise had been delayed three years. A loss of not less than two million dollars had been laid on the city, but its victory was worth many times that. Toledo's victory showed the country, in full and successful detail, a plan of campaign of which Columbus had merely given a hint. It was not a local affair, but one of even more than national importance, for the oil combination has invaded four conti- nents. This struggle and its i-esults of good omen -will pass into duly recorded history as a warning and an encourage- ment to people everywhere who wish to lead the life of the commonwealth. IsoTE. — For the year ending December 31, 1893, the city trustees report that the}' sold gas to the amount of $139,066. The city owns 5433 acres of gns territory, and has 85 wells, 73 miles of pipe outside the city, and 91 miles in the city. Since the gas began to flow the sales have amounted to 368 TOLEDO VICTOR $388,540. Out of the receipts the debt baa been reduced $60,000, besides refunding $67,000 to tbose who advanced the money for piping the streets. While doing this the plant has been considerably enlarged. The city accomplished this while charging the people but 15 cents a thousand, while the gas companies of the trust charged 25 cents a thousand. Had the city been permitted to act without obstruction, the cost of the gas plant would have been long since fully paid, and the price of gas made still lower." ' See ch. xxx. CHAPTER XXVII How to control tlie men who control the highways ? The railroads have become the main rivers of trade and travel, and to control them has become one of our hardest problems in the field where politics and industry meet. The Duke of Wellington exhorted Parliament " not to forget, in legislating upon this subject, the old idea of the King's High- way." But here, as well as there, the little respect paid by the Legislature at first to this idea soon vanished. In Eng- land, as well as in America, the State, in giving some citi- zens the right, for their private profit, to take the property of others by force, legally, for railways, began bj' limiting strictly the power so acquired. Then, passing under the con- trol of that which it had created, the State abandoned its at- tempts to control. Now the State is retracing its way, and for many years has been struggling painfully to recover its lost authority. In tiie first English cliarters there were the minutest regulations as to freight and passenger charges, and the right of citizens generally to put their own cars on the tracks was sacredly guarded. The railroads became too strong to submit to this, and the success with which the teachings of Adam Smith were ap- plied to the abolition of the old-fashioned restraints on trade bred a furor against any social control of industry. These limitations were left Testimoii.v, New York Assembly " Hepburn " Report, pp. 3083-94. ° TitusviUe and Oil City Independents' cases. Interstate (Commerce Commission Reports, vol. v., p. 415. 5 Testimony, Xew York Assembly, 1S79, p. 3678. BRITISH GOVERNMENT AGAINST THE BRITISH 409 something inferior. The latter policy was adopted. The government was induced to permit tlie sale to private con- sumers of oil that would give oflE an inflammable gas at a tem- perature of 73° — a lower temperature than often exists in living-rooms. Meanwhile the government continued to insist upon oil that would stand a test of 105° for its own use in the navy and 14.5° in its light - houses. The absurdity of this legal test was proved by Mr. T. Graham Young, son of Mr. James Young, founder of the Scotch oil industry, in a letter to the Glasgow Herald of May 12, 1894. He showed by the records that the year before there had been sixty days in London in which the temperature had gone above 73°. The government, that is, gave its sanction to the sale of oil which might explode at a heat below that ordinarily reached in an English summer! Commenting on the strange fact that the Scotch oil companies did not move against the change of test which had put them and the British consumer at the mercy of this explosive American oil, Mr. Young said: " It is geuerallj- understood that they are precluded from doing so bj'an agreement with the foreign producers. I hold a letter from one of the interested parties . . . stating that for the above reason he could not discuss the matter." In dis- cussing this matter, the Glasgow Herald notes that even pa- tient and poverty-struck India complains of the "very poor quality" of the oil sent there. The Scotch papers are continually printing indignant com- ments on this action of the British government, and wonder- ing inquiries as to the influence \>y which so injurious a change in the regulations for public protection could have been ef- fected. The Scotch manufacturers are continually agitating to have the coroners in England and Ireland, and the procura- tors-fiscal in Scotland, make particular inquiry in all cases of fatal lamp explosions into the flash-point of the oil and its origin — whether American or Scotch. At the December, 1S92, meeting of the Society of Chemical Industry of Great Brit- ain it was declared that about tliree hundred deaths a year occurred in England and Wales from lamp accidents, due to 410 ''THE COMMODITY IS NOT SO GOOD AS BEFORE" the explosiveness of the American oil sold under this reduc- tion of the test. The agitation against this dangerous oil has been increasing in Great Britain year by year. Tlie subject has been investi- gated by the Glasgow Chamber of Commerce, which found that many serious accidents to life and property had resulted from the use of this oil, and at its meeting of May 14, 1894, the ciiamber voted to petition the government to raise tiie test again to 100°. The Manchester and Edinburgh cham- bers of commerce took similar action. A number of other bodies have taken the subject up, and the government has had to promise to make an inquiry. The statistics show that last year nearly one in five (19.3 per cent.) of the fires in London and more than one in eight (13.24 per cent.) of the fires in Liverpool came from kero- sene. Tlie oil used in those cities is principally the cheap American article sold under the lowered test of the English law. But in Glasgow, where most of the oil burned is that of the Scotch manufacturers, who, by agreement, sell no lower quality tiian 100° test, the number of fires from kerosene is less than two in a hundred (1.7 per cent.). At a meeting of representatives of the leading insurance companies of Edin- burgh and Glasgow, June 20, 1894, experiments were made with the American, Russian, and Scotch oils. The American was found to be the most explosive, and some of it flashed at 69°. A lighted match thrown into this oil heated to 88° started an instantaneous blaze; thrown into Scotch oil it was extinguished. Experts testified that the cost of making the oil safe would be about a fartliing a gallon, and that if the Americans, whose "self-interest" and " private enterprise" are not equal to a voluntary effort, were compelled by law to furnish a better illuminant, their profits would be greater, not less. A rich field for investigation is concealed beneath the elab- orate system of State inspection, by which the people have sought to protect themselves from being tempted by decep- tive prices to buy a sure death. We have seen in several WARNING FROM BOSTON'S FIRE MARSHAL 411 places how the State inspectors are in the employ, at the same time, of the State and the seller, whom it is their duty to watch for tlie State.' Evidence abounds at every turn of the use of inspectors and inspection laws to embarrass and even suppress the smaller refiners. One of the latest instances is a new law in Tennessee, which puts special difficulties in the way of oil reaching the State by river, the avenue to wliich independent refiners are forced by the discriminations of the railroad. We saw an inspector of the State of New York ap- pear at tiie Bremen congress as the avowed representative of the "united refineries," complaints of whose bad oils occa- sioned the congress. By one of those coincidences in which the world of cause and effect abounds, the Fire Marshal of Boston, in the same year in which Joshua Merrill described his fruitless efforts to continue the manufacture of a first-class oil," found it neces- sary to warn the people against the dangerous stuff they were burning in their lamps. In his report in 1888 he called attention to the fact that one-tenth, nearly, of all the fires in Boston the preceding year had been caused by the explosion of kerosene or by its accidental combustion. He got samples of the oil used in a number of the places where fires had occurred from explosion, and had them analyzed by profess- ors of the Institute of Technology in Boston and of the School of Mines of Columbia College in j^ew York. They found them to be below the quality required by the State. Singularl}' enough, one of the State oil inspectors, examining similar samples, declared them to be above the standard of the State. The Boston Herald, discussing the matter, pointed out that the oil inspectors were paid by the owner of the oil. This, it said, placed inspectore practically under the oil com- bination, which has ways, it continued, of making things un- pleasant for inspectors who make reports unsatisfactory to it. The fire marshal's conclusion in all the cases he investigated of these fires by explosion was: "I have felt warranted in ' See pp. 216, 320. ■ See p. 188. 412 "THE COMMODITY IS NOT SO GOOD AS BEFORE'' every instance in attributing tlie blame to tlie inferior quality of kerosene used." ' The European protest of 1879 followed close upon the suc- cess of the comprehensive campaign of 1878" "to overcome competition." The warning from the Fire Marshal of Boston in 1888 and the success of the movement, begun in 1885,° to shiit the independents of Oil City and Titusville out of Bos- ton and New England came close together. These are not coincidences merely. They are cause and effect. It is known that a practice has grown up among the oil inspectors of the States of allowing certain refiners to brand their own oil as they please, or letting it go to market un- branded. This permits the sale of unbranded and therefore illicit and presumably dangerous oil. Charges that inspectors in Iowa loaned their stencils to the oil combination to do its own branding were made formally in writing, in 1890, by one of the deput}' inspectors, in the form required by law, to the governor of the State. The law provides that charges so made shall be investigated by the governor. JSTo investiga- tion was made, but the inspector was removed just as he was about to lay before a grand-jury documentary evidence of this and other violations of the law. This inspector declared publicly that inspectors were in the habit of leaving their official stencils with companies in the oil combination, and allowing them to put any brand the}' chose on any oil. He refused to continue this practice, nor would he brand bar- rels until they were filled. The representative of the com- bination in that State used every device except force, tlie inspector says, to induce him to conform to the practice. " Don't you know," this representative said, " that if you leave us your brand and get into trouble you will have the oil combination back of you ? You will be taken care of." In his formal complaint to the governor, this inspector de- clared that this representative said in substance to him: "You are the only fool among the inspectors. "We have the ' Second Annual Eeport, Fire Marshal of Boston, Jlav, 1S88, p. 9. = Seep. S4. ^Seecli. xi. FINSINOS OF THE MINNESOTA SENATE 413 stencils of the inspectors at every other point where we want them." The law pnt upon the governor the duty to investigate upon receiving written complaint. Bat when written com- plaint was formally made, and that not by an ordinary citizen, but by one of the sworn officials of the State, the governor demanded that the inspector back up his charges with the affidavits of witnesses — that is, the governor demanded that the inspector, who had no power, should make the investiga- tion. This put an end to the whole matter. The inspector could not make the investigation, and the governor would not. The same governor refused to allow the written charges to be seen, although tliey are public documents, and they remained invisible as long as lie held office. Only a few weeks after the removal of this inspector, the State oil in- spector was sued for heavy damages by the owner of a barn which had been burned down through the explosion of bad oil. The ground of the suit was that the inspector, having failed to inspect and condemn this oil, as he should have done, was liable on his bond to the State. The press of Iowa commented freely on the probable connection between destructive fires, like this one, and the custom of allowing the oil ring to inspect itself, by which it was given tlie opportu- nity to put inferior and dangerous oils on the market with the brand of the State on them as good. As far as the case has been carried, up to date, the Iowa courts have sustained the claim and held the inspector in damages. That which is an uninvestigated charge in Iowa is an offi- cially ascertained fact in Minnesota. The demonstration in the latter case amounts practically to confirmation for the former, since the parties in interest, the motive, and the op- portunity are identical. An investigation was made of the conduct of the State oil inspector by tlie Committee on Illu- minating Oils of the Minnesota Senate, in 1S91. The commit- tee say in their report, which was adopted by the Senate : " The testimony further shows that stencils were left with different oil companies by the State inspector or his deputy, 414 "THE COMMODITY IS NOT SO GOOD AS BEFORE" by which the companies caused their barrels containing oil to be branded by their own employes, without the supervision of any State official. It appears that after the arrangement for the payment of the inspectors' and deputies' salaries by the oil companies was made, the attitude of the inspector towards Lis duties may be summed up in a few words of his testimony: 'I am under no obligation to the State of Minne- sota. The Standard Oil Company paid me.' " ' The methods covered by the general phrases of the Minne- sota Senate Committee were described in detail by a " com- missioner" of the Omaha Daily Bee, which found the same things beinsr done in Nebraska. The Bee in 1891 made an elaborate investigation of the manner in which the oil inspec- tion of Nebraska was executed. Its reporter passed incognito by the guardians of the portals of the warehouse of com- panies belonging to the oil trust in Omaha, and stood by while barrels were filled with uninspected oil and loaded on the cars for shipment to various points. That the people who bought the oil might know their lives were safe, eacli barrel bore the brand of approval provided by law, as fol- lows: Approved. Flash Test 105° SiaU Inspector of Nebraska. By Deputy. But there was no inspector piesent, and the barrels were all branded beforehand and while empty, in defiance of the law and public safet}'. The reporter stayed until the cars were loaded, the doors closed, and saw the trains pull out. It is from this warehouse that the greater part of the barrelled oil consumed in Nebraska is forwarded. At the warehouse of the same company in Nebraska City the reporter found the same thing going on, and there, too, be found the official stencil-plates of several of the State oil inspectors lying at hand on the tanks, waiting to be used at the pleasure of the ' Journal of the Senate of Minnesota, llarcb, 1891, p. 716. FOB FAMILY USE 415 employes of the company to brand the desired government guarantee on any oil, regardless of what it was. The Illinois /State Journal found the same practice permitted in Spring- field by the oil inspector in February, 189i. The jBee re- porter describes how tanks, once branded, came and went, were filled and emptied and filled again for months, with no inspection of the oil in them. Often the tanks were not even branded. The Omaha Daily Bee of November 24, 1891, gives a careful analysis of the recently amended inspection law of Nebraska. It shows that in many important points the law has been changed so as to pnt the safety of the people in the power of the combination which supplies almost all the oil used in the State. The standard required has been lowered. The liability to a charge of manslaughter for death resulting from bad oil has been changed to a liability for damages. The method of making the tests has been changed for the ^yoree. No provision has been made for the protection of travellers by the inspection of oil used by the railroads, although acci- dents, and serious ones, from the use of dangerous oil were fre- quent in the trains and at stations.' The Bee said editorially of the oil combination that it had " managed, by its shrewdness in enacting this law, to make Nebraska the refuse tank for its rejected Eastern oil, and at the same time to crowd out of the State about all opposition." By means of this lowering of the test, oil that was too poor to pass in Iowa could be sent on to Nebraska and sold there. The Bee gives instances wliere this was done. The ^fy the com- parison below, made by Mr. Byron W. Holt : COMPARATIVE PRICES OF STAPLES DUR^^:G TUE CURREXT DEPRESSION Wheat, No. 2, red Corn, No. 2, raised Cotton, middUng upland Wool, Ohio and Pennsylvania, X Pork, mess, new Butter, creamery Sugar, raw, 96°." Sugar, granulated Petroleum, refined, giil Pig Iron, Bessemer, Chicago Steel Kails, Chicago Steel Beams, Chicago Coal, Bituminous, Pittsburg. . . Coal, Anthracite, New York. . . Per cent, of April 2S, 1S03 July 20, 1894 Decline since April 2S,1S93 $ 0.76| $ 0.56^ 26 .50 .474 5 •('HI ■OVj 10 .28 .18 36 21.00 14.00(5)14.25 33 .30@33 .17 45 .03^@4 -03A IS ■05^'^ ■04t\ 15 .0555 .0515 7 14.50@ 16.00 11.25@11.50 23 30.00@ 32.00 25.00@27.00 16 .02 •oij 25 June 30, 1S02 June 30, 1S94 June 30, 1S92 S 1.07 $ 0.86 20 4.15 4.15 00 The prices of four of these products— granulated sugar, petroleum, steel rails, and anthracite coal— are controlled by strong trusts. These prices liave declined, since the beginning of the depression — about j\Iay 1, 1893 — not quite 10 per cent. Prices of the other ten products have declined 24 per cent. Under free conditions prices of manufactured articles would decline faster than prices of farm products. Cost of production can be lowered faster in machine or factory products than in farm products. Under the influence of trusts the natural order is not only reversed, but prices of farm products have declined more than twice as fast as prices of factory or trust products. Trust influence is conspicuous in the cases of sugar and coal. The price of raw sugar, in which there is no trust, has declined 5 per cent. since June 30, 1891. The price of granulated has advanced 4 per cent. The president of the trust admitted to Congress in 1894 that it had advanced the price | of a cent a pound. Cost of refining has declined since 1891. There being no well-defined trust in bituminous coal, its price has declined 80 per cent, since 1891. The price of anthracite coal has advanced 2 per cent, in the same time, because the producers have "regulated " production. CHAPTER XXXI ALL THE WOELD UNDEE ONE HAT " Tins business belongs to us." This was the reply the president of the oil combination made to a neighbor who was begging to be allowed to continue the refinery which he had successfully established before his tardier but more fortunate competitors had left their produce stores, lumber-yards, and book-keepers' stools. He could remember, the neighbor told the liew York Legislature, before tliere was any such com- pany as theirs, and when the president of the poor man's light was still in the commission business opposite him and his refinery. He described how the president left this com- mission business, and "commenced to build a refinery there of a small capacity. . . . He used to say to me, ' What is a good time to sell?' and 'What is a good time to hold?' as he said he thought I knew." The day came when the neighbor who had been first found that the last was to be firet. He was making $21,000 to $22,000 a year, but he had " to sell or squeeze." Pie had several conversations with the new-comer who had been so successful in learning when it was " a good time to hold." To save his livelihood, '•' I did almost condescend to tease him," he testifies. But the only reply he could get was : We have freighting facilities no one else can get.' This business belongs to us. Any concern that starts in this business we have sufiicient money to lay aside a fund to wipe it out. " Thej-- went on just as if it did be- long to them, and there were others started before he did in it which I thought it belonged to quite as much as it did to ' See eh. xiv. " TEIS BUSmESS SELONOS TO US " 433 1dm. ... I am wiped out and made a poor man. ... I think they are making a profit out of mj' ruin." His refinery had been giving him a profit of $21,000 to $22,000 a year. It had cost him $41,000, but he liad to sell it for $15,000. This purchase of $41,000 for $15,000 was one of " the little economies " to which the trust ascribes its suc- cess. It was not a " good time to sell," but he sold. Part of the " squeeze " put upon liim was the rebate given to the buyer. He could not have got the rebate if he had applied for it, but he would not apply for it. " I made application for lower freights, but not for any drawbacks ; I did not sup- pose that was the right way to do business." ' " This business belongs to us." This remark was not proph- ecy, but history. It was in 1878, and the claim had been already made good. The New York Legislature, in 1879, re- ported that the speaker and his associates had control of 90 or 95 per cent, of the industry. '•' It has absorbed and monopo- lized this great traffic, which ranks second on the list of ex- ports of our country'." ° This conclusion was based on the evidence of officers and stockholders.' Their shadow grew no less. The Interstate Commerce Commission found in 1890 that they " manufacture nearly 90 per cent, of the petroleum and its products in the United States." * " Trifles make perfection, and perfection is no trifle." For the perfection of this triumph no trifle has been disdained, from the well in the mountain to the peddler's cart in the city. The bargemen of the AUegliany, the coasters of the sea -shore, and the stei'n- wheelers of the Western rivers all had to go one way. " "We drove out the shipments in the schooners from Baltimore and Washington, and we stopped almost the shipments by river down the Missis- sippi by boat," said one of the successful men. His plan ' Testimony, New York Assembly " Hepburn " Keport, 1879, pp. 2623-40. ' Same, Keport, p. 44. 'Testimony, same, pp. 2615, 2696. * George Rice vs. Atchison, Topel;a and Santa Fe Railroad et at. Interstate Com- merce Commission Reports, vol. iv., p. 228. 28 434 ALL THE WORLD UNDER ONE HAT had been so thorongb as even to seek to "drive off the river schooners." ' The last stage in their economic development — that in which the people of the oil region lose the ownership of the oil lands and become hired men — is already far along. Al- though at first the oil combination owned no oil lands to speak of — "It does not own any oil wells or land producing oil, and never did," its president said, in 18S0 ; "an infinites- imal amount," he said later'' — it has of late years, through corporations organized for that purpose, been a heavy buj-er and leaser of the best oil lands in Pennsylvania, New York, Ohio, Kentucky, and the West. Monopoly anywhere must be monopoly everywhere. At the beginning it was enough to control the railways ; by these the pipe lines, refineries, and markets were got. These were secui'ed, only to find that it was vital to control the source of supply. The producers once gave an illustration of what it would be for the sole buyer to come to the market and find that the oil he must have was not on sale at his price.^ " We have during the past year," one of the combination said, in 1891, before a committee of the Pennsylvania Legislature, "invested a very large amount of money, and have induced our friends to come forward with new capital to engage in the business of producing oil." ' By the policy of becoming jDroducei-s the combination has changed its position from that of mere intermediary — though one as irresistible as a toll-gate keeper — to that of absolute owner. The spectre it has seen rise before it, of the producers organized as one seller to meet it as the only buyer, has been laid to rest. "We are pushing into every part of the world, and have been doing so," the president told the ISTew York Legislature in 1888.' Their tank-steamers go to all the ports of Europe and ' Testimony, Trusts, Congress, 1S8S, pp. 52S-29. "Testimony, Trusts, Xew Tork Senate, 18SS, pp. 3S6, 425. ' See pp. 56-57. ■"Before the Pennsylvania Legislature, Harrisburg, February 19, 1891. Har- risburg X>ai/i/ Patriot, February 25, 1891. 'Testimony, Trusts, Xew York Senate, 1S8S, p. 422. ANNEXING CANADA— CATCHING A SCOTCHMAN 435 Asia, and their tank-wagons are as familiarly seen in the cities of Great Britain and the Continent as of America. An agitation of extensive proportions was begun in 1893 in the press of Canada and in the Dominion Parliament to admit American oil at a lower duty. There was no popular demand for such a step. No general reduction of the tariff was proposed. The movement was simultaneous in the press of different parts of Canada, and it was promoted by papers as important as the Toronto Globe and Montreal Star. It was resisted with des- peration by the 20,000 persons who are employed in the Cana- dian oil industries, the growth of thirty - two years — " not a rich, gay, bloated population, rioting with the plunderings of the farmers, revelling in all kinds of luxuries, making merry with their friends," says a newspaper correspondent, who vis- ited them in December, 1892, "but a hard-working communi- ty, in which all live comfortably ; few are rich." This opposition was successful with the Dominion Parlia- ment in that year, and it refused to admit American oil at a lower tax. But the finance minister then, by executive ac- tion, did in part what the Legislature had refused to do. By lowering the inspection duty and changing custom-house con- ditions he made a considerable reduction in the tax. The agitation to reduce the tariff was not relaxed, and was finally successful in 1894:, when Parliament lowered the duties on oil, and to that extent surrendered the Canada producers and re- finers to their American competitors. The Scotch refiners, some of whom have been in business forty years, have become as loj'al subjects of an American ruler as of their own queen. They make only as much as he allows, and sell at the price he fixes. He has demanded year by year a greater proportion of their business.' In 1892 they were notified that they must reduce their output bj' 10 per cent." The Scotch, anxious for the accelerating future, begged that the "arrangement" might be made for three years instead of one. But this was denied them. The agent ' Scotsman, October 1, 1892. Tall Mall Gazette, January 11, 1892. 436 ALL THE WOULD UNDER ONE HAT from America who brought them their orders would promise no more than " to place the matter in a favorable light before his colleagues in America." ' By October of that year the capital of the Scotch companies, held mainly by small invest- ors, had shrunk $5,000,000 in value. But to this item the London Economist adds the consolation that " that power- ful organization " — the American — " has for years professed the kindliest feelings for the Scotch producers." Dr. John- son said that much may be made of a Scotchman if caught young. The American caught him old. The disturbance fell heaviest, as always, on the working- men. "Beduction in wages is now being eflEected," writes the managing director of the oldest and largest of the Scotch companies in the Economist. "Another 10 per cent, reduc- tion in miners' wages has been resolved upon," the Economist annoimces in its issue of October 8, 1893. One of the causes that contributed to the downfall of the Scotch refiners was the fact that the British government re- duced the test required for illuminating oil. This new regu- lation opened the British markets to a flood of cheap oil from America.' The Scotch oil is better made and more expensive. '• AVe cannot tell," said a correspondent of the Glasgow Her- ald, " what powerful interest the American oil combination did not bring to bear on our government. The public had then no champion, and as a rule never have on these occa- sions." The unkindest cut of all is that it was from the Scotch manufacturers themselves that their American rival and ruler learned the secrets of the industry it is now absorbing on the instalment plan. In one of its publications it has told how its '• experts visited the great shale works in Scotland, and studied their methods," and how "the consequence was that extensive works were erected." " The economic development of Germany is not so much be- hind that of Great Britain and America as to seem iminvitino- ' Standard, Shoe Lane, January 26, 1892. 'See p. 408. ^ Combinations, by S. C. T. Dodd, 18SS, p. 31. THE GBltMAN-AMERICAN WAR 437 to the unhasting but unresting American. Some years ago enterprising German importers invested a large amount of capital in tank-steamers, because they thought these solved the problem of the transportation of petroleum. When the Amer- icans refused to supply them any longer with oil for their steamers to carry, they saw that there was more in this prob- lem than they had guessed. Importers who had no steamers found one day that American enterprise had secured practi- cally all of them, and had very decided notions as to whom cargoes should be taken. The heads of two or three of the largest houses boarded a steamer for New York, and came back stockholdei-s in a German- American company which con- trols most of the German business, as the Anglo-American com- pany controls that of Great Britain. "If the great companj'^ with unlimited capital cares to lose money, it can drive us from the field," was the esplanation of the head of one of the largest German concerns, as quoted in the Weser Zeitung. At the beginning of the next year some Holland firms were invited into the same shelter, and became the "fittest"; and then followed the Belgian and the Scandinavian countries. The Berlin Vossische Zeitung of June 18, 1891, described the line of march : " One group of business men after anotlier is thus made superfluous and pushed aside. First the wells, pumps, and refineries in America, then the American export trade, then the private freight vessels adapted for transportation of petroleum, then the European import trade, then the export trade from European ports, and, finally, this over-powerful company threatens to seize the entire retail trade in petro- leum. It is a world monopoly." Hundreds of boatmen en- gaged in a flourishing river trade in Germany were driven out bj^ tank-boats. If they had changed to tanks, they would have been dependent on their opponent for the oil to fill them. Im- porters in barrels were cut off by a change which the German government made in the tariff on barrels. The Americans were also helped by an increase in the German tariff on Rus- sian oil of 50 per cent,, which made it so much the more difficult for it to compete with American oil. As one way 438 ALL THE WORLD VNDEE ONE HAT to kill competition where it still existed, all statistics were suddenly witliheld by the German -American member of the trust. Neither exports nor imports were known except to the ruling company; all others were kept in the dark. This success in Germany has not been due to favoritism on the highwaj's. The extraordinary discrimination on railroads in America would be impossible in German^'. With hardly an exception the railroads are under the supervision of the State, and are very carefully controlled. Even the private roads would not dare to give any but the open rates. In Austria-Hungary, formerly, secret rates were in full swing, but the system is now said to be destroyed. Prices have declined in Germany, and the people at large make few complaints except about the quality of the Ameri- can oil. It has become more sooty than formerly. In the beginning it burns well, but it ends with giving a very poor light. This has been conjectured to be due to a mixture of the inferior Ohio oil with that of Pennsylvania; bnt "it cannot be proved," the German chronicler reports.' " The working people," says one of the Berlin papers, " will have to foot the bill, and the working people only. The well-to-do and rich of to-day can have otiier fuel and light, but to the oppressed working-man petroleum is as great a necessity as his potatoes." The German papers, in casting about for means of checkmat- ing the increase of prices which thej believe will result from the consummation of this monopoly, advocate tlie use of wa- ter-power and also wind-power to create electricity. The attention that has been attracted to the growth of this power does not come from the public at large, but from those directly interested and the sympathy and interest of the Ger- man " national economists." The latter point out that the present cheap prices are " war prices." They predict that as soon as the world monopoly is established and all territory is under complete control a rise of prices will take place. They are advocates of State monopoly as better than private mo- ' Die Monopolmrung dcs Peiroletim Handels mid der Petroleum Industrie, by E. F. Soemann. L. Simeon, Berlin. FROM miDNIOHT SUN TO MEDITERRAJfEAN 439 nopoly. If State monopolies prevent free competition, at least they are able, they say, to give some compensation to those who are hurt. In the tobacco monopoly hundreds of millions were set aside by the German government for this purpose, but even that was not considered sufBcicnt. But this monopoly is a private affair. It swallows the profits of all those whom it destroys. Numerous industries have been ruined — importers, ship-owners, brokers, local dealers, export- ers, retailers, river boatmen, and numerous other trades — but no one i-eceives indemnity. The public opinion of the gov- ernment, the Keichstag, the national economists, the philan- thropists, is active in support of the middle class, but in spite of all this a whole department of industry has been torn away from it. There are one or two "independents" in Germany whom, like the independents in America, the trust has not yet been able to crush, though it is turning the markets topsy-turvy for that purpose. The Pall Mall Gazette of June 18, 1894, notes that the trust is selling refined oil in Europe at prices lower than those at which crude oil can be delivered from America. The Austrian journals have been chronicling the absorption of the principal refineries of Austria and Hungary by a com- bination, of which the Rothschilds are the most important members, as they are of that in Russia. This combination, which first appears in 1892, has by 1894 accumulated a re- serve of 3,000,000 gulden on a capital of 1,000,000 gulden, and its profits for 1894 are expected to be 100 per cent. The Prager Lloyd of April 26, 1894, giving these and other facts, adds that " the government of Austria as well as of Hungary takes the ground that if a petroleum monopoly is to be formed it should be in the hands of the State, not of a corporation, certainly not of a foreign corporation, least of all an Ameri- can one." This remedy of a State monopoly as an alternative to pri- vate monopoly, as suggested in Austria and Germany, has as yet had few advocates in America. Our public opinion, so 440 . ALL THE WORLD UNDER ONE HAT far as there is any public opinion, restricts itself to favor- ing recourse to anti-trust laws and to boycotting the mo- nopoly and buying the oil of its competitors. But there are too few of these to go around, and they are shut out of most of the mai-kets. The shrewd monopoly is itself the most diligent caterer to such American demand as there is for the "anti-monopoly" product. It does business under hun- dreds of assumed names, and employs salesmen at large sal- aries to push the sale of "opposition oil" in our disaffected provinces. With the news from Germany came the announcement that similar control had been obtained of the business of the firm at Venice which did most of the oil business of Italy, and a new company had been formed, of which the American '• trustees " own a majority. In a letter sent to Minister Plielps, at Berlin, a resident representative of the American oil combination says, as quoted in the New York Tribune, October 5, 1891 : " For the furtherance of our programme and as participators in the large European investment which this programme involves, we have sought and been fortunate enough to secure the co-operation of a coterie of well-known merchants, who have been long and prominently identified with the petroleum commerce of the Continent." The So- cieta Italo-Americana del Petrolio (the Italian- American Oil Company) is in Italy what the concerns just described are in the countries to the north of it. The head of the oil com- bination was quoted by the New York Tribune of July 1, 1891, as saying : " The cable despatches are substantially correct as regards our interest in the German and Italian companies." The French government a year ago lowered the tarifE on petroleum one-half. This was followed, the French press re- ports, by the erection of a refinery by the American trust at Eouen, and the purchase by it of land in Marseilles, Cette, Bordeaux, and Havre for other refineries. The machinery needed was shipped from America. Large ofiices were opened at Paris by the American combinatiou for the administration FHANCE, PERU, AND RUSSIA 441 of the industry in France, which was to be concentrated into its hands like that of the rest of Europe. The sequel, if the Frankfurter Zeitung, a prominent German commercial paper, is correctly informed, is that the French refiners, as the Scotch did before th«m, have come to terms with the American trust. It has agreed not to start up its refineries in France, not to sell any refined oil in America for shipments to France, and not to allow any American outsiders to compete with the French refiners. There was a report in June, 1892, that a Dutch company had succeeded in refining petroleum in Sumatra, one of the possessions of the Netherlands' East India colonies, and selling it in India. The solicitor of the trust, asked about it by the New York Times, June 5, 1892, said, " It cannot be true." The oil combination, he continued, "has agents in the Nether- lands' East India colonies and at Sumatra, and it would cer- tainly have heard of this corporation and its competition if there was anything worth hearing." There are great oil-fields in Peru. Since the close of the war with Chili there has been an active development of them, and the commercial reports of San Francisco say that fuel oil is now being supplied from this source to our Pacific States. This has not been done by the Peruvians. It was an Ameri- can who organized the oil industry of Peru. The principal company was formed by the same expert who went years ago from Pennsylvania to Pussia to Americanize the oil interests of the Caucasus. After he had succeeded in that task he went to Pern. He died in the spring of 1894. At about the time of his death the newspapers, by a coincidence that arrests attention, chronicled the departure from New York of a well- known man who was going to Peru, as he stated in an inter- view, to look after the interests of the members of the oil trust. But there is no ofiicial information that they have any ownership or control there. When one of the officers of the combination was before Congress, in 1888, he was asked if there had been any negotia- tions by his associates with the Russian oil men. 442 ALL THE WORLD UNDER ONE HAT "We have never had any serious negotiations,'" he re- plied. The word "serious" was a slip. He withdrew it. "We have never had any" was his revision. Three years later the same ofiBcial, in a speech to persuade the Pennsylvania Legis- lature that the pipe-line interests of the oil country did not need the regulation by the State then under debate, but were abundantly safeguarded by him and his associates, said : "It may not be amiss for me to say that Ave have had, at different times during the last several years, most flattei-ing propositions from people who are identified with the Rus- sian petroleum industry, to come there and join them in the development and introduction of that industry. "We have declined these offers, gentlemen, always and to this day, and have held loyal to our relations to the American petro- leum."" There had been negotiations, after all ! The re^jorts of the United States consul-general at Berlin, in 1891, transmitted many interesting articles from the Ger- man papers concerning the alliance which it was believed had been made between the Rothschilds and the American oil combination. A companj"^ managed by the great bankers has obtained a commanding position in the Russian oil business, and the American and the Russian were even then said to have divided tlie world between them. The Berlin Yossische Zeitung said : " Heretofore the two petroleum speculators have marched apart, in order to get into their hands the two largest petroleum districts in the world. After this has been accomplished they unite to fight in unison, and to fix as they please the selling price for the whole world, which they divide between themselves. So an intei'national speculating ring stands before the door, such as in like might and capital power has never before existed, and everywhere the intelli- gible fear prevails that within a short time the price of an article of use indispensable to all classes of people will rise ' Testimony, Trusts, Congress, 188S, p. '792. 'Harrisburg Patriot, February 25, 1891. AMERICAN METHODS IN THE CAUCASUS 443 with a bound, witliout its being possible for national legisla- tion or control to raise any obstacles." ' But some of the closest European observers have seen reasons from the beginning to believe that the Rothschilds are in the Kussian oil business only as the agents of the American combination. This is freely asserted by the Conti- nental press. The policy of the Kothschilds has been never to engage in commercial enterprise on their own account. Tlie tactics used by the Kothschilds in oil have been an almost exact reproduction of those of the combination in America. From the firet they gave the subject of freights their special attention. They showed no ability for new or indepiendent iindertakings, but they tried, to use the words of an Austrian-Hungarian consular i-eport from Batoum in 1889, " following the example of the combination in the United States, to get the bulk of the Russian petroleum trade into their hands " ; using the large money power at their com- mand for speculation, freely advancing money for leases and delivery contracts, and specially acquiring all the available means of transportation. The experience of the people of Parker" is recalled by the statement that the Eothschild com- pany would leave hundreds of cars loaded with petroleum on the tracks for weeks to prevent competitors from shipping and from filling their contracts. When the city of Batoum, in 1888, refused to allow it to lay pipes over tlie city lands to the harbor, it was with the enthusiastic approbation of the agitated citizens. The authorities gave as their reason that through large establishments of this kind the capitalists gained a monopoly, crushing out smaller producers to the disad- vantage of all classes of the population. In the absence of official investigations, a free press, and civilized courts — that knowledge which is not only power but freedom — it is im- possible for any one in Russia, or out of it, to know the truth as to the relations of the Rothschilds to the American mo- nopoly. The latest news in the summer of 1894 is of a ' Translation from the Berlin Vossisclie Zeiiung, June 12, 1S91. Report of Con- sul-General Edwards, of Berlin. » See p. 106. 444 ALL THE WORLD UNDEB ONE HAT great combination of Russian and American oil interests, under the direction of the Russian Minister of Finance, for a division of territorj', regulation of prices, and the like. In- formation of this was given to the world bj' that minister's official organ in November, 1893. Thus says the Hanover (Germany) Courier of November 11th : " With the direct sanc- tion of the Russian government the management of the enor- mous wealth that lies in the yearly production of Russian pe- troleum will be concentrated in the hands of a few firms. . . . The Russian government lends its hand for the formation of a trust that reaches over tlie ocean — a trust, under State pro- tection, against tlie large mass of consumers. This is the new- est acquisition of our departing century." It was announced that, in pursuance of this plan, the Rus- sians wei'c to be given exclusive control of certain Asiatic markets. Tlie officers of the American combination are not easily reached by newspaper men. But when this news came long interviews with them were circulated in the press of the leading cities, dwelling upon tlie " Waterloo " defeat they had suffered, and reassuring the people with this evidence that there was, after all, " no monopoly." Tlie Russian interests are dominated by the Rothschilds, and if the Rothschilds are, as these European observers declare, merely the agents of the Americans, even unsophisticated people can understand the cheerfulness witli which the trustees in New York dilate on their Waterloo at the hands of their otlier self. Only this could make credible the report that the world has been di- vided with the Russians by our American " trustees," who never divide with anybody. In dividing with the Russians they are dividing with themselves. Though it is reported that discriminations by the govern- ment railroads of Russia were used to force the Russian pro- ducers into this international trust, still, at worst, every Rus- sian producer was given by his government the right to enter the pool. But no similar right for the American producer is recognized by our trust. It admits only its own mem- bers. Tlie others must " sell or squeeze." There is something MEN WHO STAND IN THE WAY 445 in the world more cruel than Kussian despotism — American " private enterprise." One of the conditions said to, have been made by the Kus- sian government is the natural one that the American trust, as it has agreed to do for the French, must protect its Kussian allies from any competition from America. Extinction of the "independents" has therefore become more important than ever to the trust. The prize of victory over them is not only supremacy in this country, but on four other continents. This will explain the new zeal with which the suppression of the last vestige of American independence in this industry has been sought the last few months of 1893 and in 1894. Es- pecially strenuous lias been the renewal of the attack on the pipe line the independents are seeking to lay to tide-water, and which they have carried as far as Wilkesbarre.' That pipe line, as it is the last hope of the people, is the greatest menace to the monopoly. The independents, as they have shown by the fact of surviving, although they have to pay extraordinary freights and other charges from which the trust is free, can produce more cheaply than the would- be Lords of Industry, as free men always do." By means of this pipe line, suspended though it is at Wilkesbarre, are now made the only independent exports of oil that go from America to Europe. Once let the "outsiders" with their line reach the sea-shore and its open roads to the coast of America and Europe, and it will be a long chase they will give their pursuers. Everything that can be brought to bear by market manipulation, litigation, and other means is now being done to prevent the extension of this line, and to bank- rupt the men who are building it through much tribulation. The mechanical fixation of values, by which the refiners who nse this line to expoi't oil are compelled to meet a lower price for the refined in New York than can be got for the crude out of which it is made, has been already referred to, and, as shown above, the same prestidigitation of prices is ' See ch. xii. ° See chs. xi. and xxx. 446 ALL TBE WORLD UNDER ONE ITAT being resorted to in Europe against tlie independents of Ger- many. Early in 1894 the independent refiners and producers re- solved to consolidate with this pipe line some other lines owned by them in order to strengthen and perfect the system, and put it in better shape to be extended to tide-water. This con- solidation was voted by a large majority both of stock and stockholders. But a formidable opposition to it was at once begun in the courts by injunction proceedings in behalf of one man, a subordinate stockholder in a corporation of which the control is owned, as he admitted in court, by members of the oil trust.' The real litigant behind him, the independents stated to the court, was the same that we have seen appear in almost every chapter of our story, with its brigades of lawyers. "An unlawful organization," the independents de- scribed it to the court, " exercising great and illegal powers, . . . and bitterly and vindictively hostile to our business in- terests." They came into court one after the other and described the ruin which had been wrought among them, tell- ing the story the reader has found in these pages. " It is our hope," they said, " when we once reach the salt-water that there will be no power there controlling the winds and the waves, the tides and the sun and moon, ex- cept the Power that controls everything. "When we once are there the same forces that guide the ships of this monopoly to the farther shore will guide ours. The same winds that waft them will waft ours. There is freedom, there is hope, and there is the only chance of relief to this country. Through three years of suffering and agony we have at- tempted to carry on our purpose. . . . Tou could have seen the blood-marks in the snow of the blood of the people who are working out their subscription as daily laborers on that line with nothing else to offer." The injunctions asked for by this opposition were granted 1 Testimony of J. J. Carter in tlie case of J. J. Carter vs. Producers and Re- finers' Oil Company, Limited. Court of Common Pleas, Crawford County, Pa. May Term, 189-1. ' ' THE COURT SID NOT REAM 447 by the lower court, but the independents took an apjseal to the Supreme Court of Pennsylvania. They first placed their petition for the rehearing in the hands of the chief- justice on Thursday, May 24th; on Monday, May 28th, the petition was renewed before the full court ; on Thurs- day, May 31st, the court adjourned for the summer with- out taking any action upon the petition. The court in July agreed to hear the case at the opening of its next term, the first Monday of October. Section II. of Article I. of the Constitution of Pennsylvania says : " All courts shall be open, and every man, for an injury done him in his lands, goods, person, or reputation, shall have remedy by due course of law, and right and justice administered, without sale, de- nial, or delay." To guard against the injustice which might arise by the granting of special injunctions by the lower courts — like that granted in this case — which might remain for months without remedy, the Legislature, in 1866, enacted a law which reads as follows : " In all cases in equity, in which a special injunction has been or shall be granted by any Court of Common Pleas, an appeal to the Supreme Court for the proper district shall be allowed, and all such appeals shall be heard by the Supreme Court in any district in which it may be in session." As if there had not been enough to try these men, misfort- une marked them in other ways. The Bradford refinery of the president of their pipe line was visited by a destructive fire during these proceedings in court. The Associated Press despatches attributed the fire to "spontaneous combustion," whatever that may be. But in another newspaper an eye- witness described how he saw a man runuingabout the works in a mysterious way just before the flames broke out. On the same day, by a coincidence, the main pipe of the indei^endent line was cut, and the oil, which spouted out to the tree-tops, was set on fire at a point in a valley where the greatest possible damage would result, and the telegraph wires were simultane- ously cut, 60 that prompt repairs or salvage of oil were impos- sible. The Almighty is said to favor the heaviest battalions. 448 ALL THE WORLD UJ^DEIi ONE MAT and accident, if tliere is such a thing, seems to have the same preference, as has been shown in many incidents in our liis- tory, such as tlie mishaps to the Tidewater pipe line, and the Toledo mnuicipal gas line.' An intimation is given in the Continental press as to one of the motives under which the Eussian government acted in promoting the alliance between the Eussian and American oil men. It desired, it is said, to secure the influence of the powerful members of the oil combination in favor of cer- tain plans for which Eussia needed co-operation in Amer- ica. There has been nothing for which tlie Eussian gov- ernment has so much needed "sympathetica! co-operation" in America as for the ratification of the Extradition Treaty. The Eussian government has obtained this ratification, and obtained it in a way which indicated that some irresistible but carefully concealed American influence was beliind it. The New York World, in its editorial columns of May 25, 1894, made the suggestion that the power behind this treaty of shame was that of the oil trust, earning from the czar the last link in its chain of world monopoly. It asked if it was the influence of the oil combination that induced the Senate's con- sent to this "outrageous treaty." "Was this one of the con- ditions upon which that monopoly was permitted to secure its present concessions from Eussia ? Did it wield an influence in the Senate like that which the sugar trust has since exer- cised, though for an advantage of a different kind?" The Philadelphia Press points out that the Eussian government had long and unsuccessfully sought to obtain the ratification of this treaty, but at last got it quickly and quietly. Did the oil combination, it asks, "succeed in bartei-ing the character of this country as a political sanctuary for the monopoly of the world's markets?" Seldom has any public measure been so universally and so indignantly condemned in America as was this proposal to use the powers of Anglo-Saxon justice to return men who were accused only, and were, therefore, legally 'See pp. Ill, 366. ABOUT THE EXTRADITION TREATY 449 innocent, to be tried ■without jury, counsel, publicity, or ap- peal. Never has public opinion availed less. The Federal executive refused even to delay the ratification in deference to the sentiment against it. Those who were active in the agitation against the treaty found something inexplicable in the unresting and unlistening relentlessness with wliich it was pushed through. Napoleon said that in fifty years Europe would be all Russian or all republican. Even he did not dream that republican America would become Eussianized before Europe. The San Francisco CaM of March 3, 1S91, discussing the report that a commercial treaty with China was under consideration at Washington, says the negotiation is in the interest of the oil combination. It warns the public that the trust is willing to reopen the opium trade in reciproc- ity to China for better terms for the admission of American petroleum. This free trade with China and Russia in the souls and bodies of Russians, Chinese, and Americans woiild add only another instance of the many manipulations of gov- ernment which this combination has successfully attempted in all parts of the world — in the tariffs of France, Germany, Cuba, Canada, and our own country ; in the raising or lower- ing of the governmental requirements as to explosiveness of oil sold the people in England and the United States, and in the subsidy legislation by which it got from Congress for its ocean steamers a privilege rigorously denied by law to all other citizens. In this the oil trust is but an illustration. What it has done scores of other combinations have accomplished, though not with equal genius. The Hon. John De Witt Warner, member of Congress from New York, has published a list of one hun- dred trusts which have been able to influence the tariff legis- lation of the country in their favor. The orgy of the sugar trust and Congress, out of which the tariff bill of lS9i was born, was in the plain view of all the people. " The appall- ing fact already disclosed," the New York Daily Commercial Bulletin, the most important commercial and financial daily in the United States, said in its editorial columns of June 4, 29 460 ALL THE WORLD UNDER ONE HAT 1894, " is that for some months past the sugar trust has been the government of the United States." The BvUetin esti- mates that the profit to the trust of one detail of the tariff bill postponing the duty on raw sugar for six months -will be $34,620,000. In all this our country is not singular. The governments of Europe are used as the instruments of profit for private enterprise to an extent which the people endure only because they do not understand it. The latest instance is one of the best. The Investor's Review of London, Eng- land, in May, 1894, calls attention to the fact that upon the ac- cession of Lord Kosebery to the Premiership of England the hitherto outspoken opposition of the War Ofliee to the Maxim gun had become entirely silent, and the gun had been put into use in the army without competitive trial with other machine- guns, some of them its superiors. " Tliis is an unfortunate fact for Lord Rosebery," says the Investor's Heview, "be- cause of his relationship to the Kothschilds." This great house, the Review says, has "a strong pecuniary interest in the Maxim -Nordenfeldt Company," and his lordship's affini- ties to the house " have not in the past been confined to those of family relationship alone, but extend to community of inter- ests on the stoct exchange." The Review therefore appeals to Lord Kosebery, for his own sake and the sake of the gov- ernment " to prove by his deeds that he not only has had nothing to do with it, but will peremptoril}- stop this crime." If not, the Review hopes enough may be made of the scandal to overthrow Lord Rosebery's government, for it desires " to see a beginning made of the endeavor to purge Parliament of the guinea-pig director, the stock-gambler and punter, and the whole unclean brood of City ' bulls ' and ' bears,' jobbers in patents, bribers and bribed, who help to degrade public life." We of America are most sovereign when we sit in Constitu- tional Convention by our representatives, and change the fun- damental law as we will. The Constitutional Convention gives us tlie unique power of peaceful and perpetual revolution, to make blood}- and spasmodic revolutions unnecessary. Of all PRESIDENT OF THE CONSTITUTIONAL CONVENTION 451 the inventions of that ablest group of statesmen tlie Avorld has seen — the founders of this government — ^this is the greatest. The people of the State of New York are holding a Constitu- tional Convention in 1894 to enlarge the garment of 1846 to fit the growth of half a century. In that half-century the revolution in society and industry which had been getting un- der headway ever since the steam-engine and competition were invented has come to its consummation. But the basic law of the Empire State has faced this new world as changeless as the sphinx. Neai'ly half the other states have made new con- stitutions, or amended the old ones to bring law into line with life. Pennsylvania forbids the common carrier to become the owner of coal-mines, or to consolidate with competing cairiers, or to give preference to any citizen. Michigan, Illinois, IS^e- braska, Colorado, and many other states have framed provi- sions to control the abuse of industrial and highway power. The State of "Washington in its Constitution declares that " monopolies and trusts shall never be allowed in this State," and it forbids any association "for the purpose of fixing the price or limiting the production, or regulating the trans- portation of any product or commodity." The manual of the constitutions of the world prepared for the use of the New York convention shows that fifteen of the states of the Union have in one way or another recognized the revolution which has taken place in the industrial economy of the peo- ple, and sought to meet it with the necessary political safe- guards. When the delegates of the citizens of New York State meet in May, 1894, at Albany, in such a time to face such prob- lems, the press notes that a large proportion of them are cor- poration lawyers. The place of president of the convention is secured by the chief counsel of tlie oil trust. He is in Al- bany to resist the application to the Attornej'-General of the State to move for the forfeiture of the charter of the princi- pal corporation in the trust, and on his way he plucks the presidency of the Constitutional Convention. " It is truly a momentous event," he says in his opening speech, " when the 452 ALL THE WOULD UNDER ONE MAT delegates of many millions of people gather together after an interval of fifty years almost, for the purpose of revising and amending the fundamental law of the State." The delegates thus momentously assembled, when they came to choose the officer who was to wield over them a power as great as that of the Speaker over the Federal House of Kepresentatives, mo- mentously selected the most conspicuous attorney of the most conspicuous embodiment of the forces with which the people are in conflict. The president found words of kindly reference for many great questions — of education, suffrage, citj' govern- ment, and the like — but for the great questions of social power which fifteen states have found serious enough for consti- tutional cognizance he had not a syllable. No plan or even suggestion, great or little, for the new Constitution can reach the convention direct. All must go to the appropriate com- mittee, to be smothered or reported, as the case may be. There are thirty of these committees, and they are made up by the president of the convention, who also designates their chair- men. Each committee has its subject, and the subjects cover the bill of rights, the i-egulation of suffrage, the control of corj)orations, the election of judges, future amendments of the Constitution, and every other part of the organic law. Practically the work of the convention will be the work of the committees, and the committees are the work of one who is not only the attorney of the oil trust, but is a part of the trust, a member of the or'ganization. " I haj^pen to own one hundred shares in the Standard Oil Trust," he said in his ar- gument in Albany before the Attorney - General in behalf of the trust. The trust has given formal notice that out of def- erence to public opinion and the decision of the Supreme Court of Ohio, and in pursuance of an agreement with the late Attorney -General of JSTew York,' it had dissolved itself. But this distinguished member disregards the dissolution, for reasons of personal convenience, as he tells the Attorney- Gen- eral. "I have never gone forward and claimed my aliquot ' Affidafit of the President of the Standard Oil Company of New York before the Attorney-General, Mav, 1S94. BILL OF SIGHTS AS AN ASSET 453 share." The character of this trust, of which the president and organizer of the Constitutional Convention persists in being a member to the extent of i-efusing to be "dissolved" out of it, has been adjudicated. It was, the Supreme Court of Ohio said,' " organized for a purpose contrary to the policy of our laws. Its object was to establish a virtual monopoly . . . throughout the entire, country, and by which it might not merely control the production but the price at its pleasure. All such associations are contrary to the policy of our State and void." A similar judgment has been passed upon the trust by the judiciary of the State of which this president of the Constitutional Convention, besides being an ofScer of the courts, is a citizen. It was entered into, the Supreme Court of Kew York has said,° " for the purpose of forming a combination whose object was to restrict production, control prices, and suppress competition, and the agreement was therefore opposed to public policy and void." And a higher court, the liighest in the State, the Court of Appeals, decided in the sugar-trust, case that a trust was in avoidance and dis- regard of the laws of the State. To the monopoly of oil, which was the starting-point, are being added by its proprietors, one after the other, as we liave shown, a progressive series of other monopolies, from natural gas to iron. To these assets is now to be added our bill of rights. The long fingers of this power of mortmain reincar- nate are long enough to reach from its counting-room to the Constitutional Convention. The new Magna Charta, to which the people look for help against void and unlawful combina- tions, is to be drafted by committees made up by the attorney of the chief of these void and unlawful combinations. The instrument which is to protect the people against monopoly will come to them only after every section has been exposed ' State of Ohio ex rcl. David K. Watson, Attorney - General, vs. Standard Oil Company o£ Oliio. 49 Oliio State Reports, p. 317. "Rice vs. Trustees of the Standard Oil Trust. Supreme Court, Special Term, Part I. Andrews, Judge. Reported in the New York Law Journal, April 26, 1894. 454 ALL THE WORLD UNDER ONE HAT to the moulding touch of the greatest monopoly in history. " This business belongs to us," and theirs is the first and the last hand ou the reins of the convention. The people can vote on the Constitution after it is made, but the trust will see it made. If the new Constitution is made so obnoxious that it is rejected, as that of 1867 was, the old Constitution will do for the next fifty years as for the last fifty. It is not monopoly that needs the revision. Is this the end ? "When before the Interstate Commerce Commission, the head of the combination was asked : "The properties included in your trust are distributed all over the United States, are they not ?" "Oh, not all over the United States. They are distrib- uted." " Are they not distributed, and are they not sufiieiently numerous to meet the requirements of your business from the Atlantic to the Pacific, and from the Gulf to the northern boundary' ?" " Not yet." ' The reply came in a tone and with a smile so significant that it was answered by a comprehending laugh from the whole room — judges, lawyers, reporters, spectators, and all. " IS'ot yet !" ' Testimony, Rice vs. Louisville and Nashville Railroad et al., before Inter- state Commerce Committee, p. 366. CHAPTER XXXII This "business success" is the greatest commercial and financial achievement of histor3^ Its broad foundation was laid in the years from 1872 to 1879, the severest time of panic for others the world has known. A universal jaundice of ill- fortune has given its sallow complexion to every one else. From the Alleghanies to the Caucasus thousands of men have been somehow thi-own out of work because so much new work lias come to the world. "At the flash of a telegraphic mes- sage from Cleveland, Ohio," said the people of the oil regions in tlieir appeal to the Governor of Pennsylvania in 1878, "hundreds of men have been thrown out of employment at a few hours' notice, and kept for weeks in a state of semi- starvation." These men filled up many of tlie insurrectionary ranks of the great railway strike of 1877, as the employes of the Pennsylvania Railway declared in a public comraunica- tion at that time. The eight oil-producing counties of Penn- sylvania were said by the general council of the petroleum producers, in a public address in 1879, to be "fast sinking beneath such financial distress that resistance to tlireatened bankruptcy or servitude could not long be made." They grew too poor to pay the counsel they employed to help them in the courts, the legislatures, and before the executive of Pennsylvania and Congress. " The universal complaint we find is the poverty of the people, not their unwillingness to give." " I am ashamed," said one of them in court, " to see our counsel every day on account of the beggarly amounts I 456 "NOT BUSINESS" have paid them. A large number of producers have sub- scribed that have not paid." ' Men who were "frozen out" of their occupation in trans- porting or refining oil took to digging wells. "That is the only thing the}' have been allowed to do. They went on in a wild way, hunting new oil, and when they found it they would develop it rapidly." This made oil fall in price, and the more they produced the more they had to produce. The wages of labor kept going down. They were lower in 1888 than they were twenty-four years before. "A well-digger that I paid S6 a day and his expenses twenty-four years ago is now work- ing for $40 a month. That is true of every department of the oil business so far as the wages of workmen are concerned." " We were 810,000,000 poorer at the end of 1887 than at the beginning," said the association of oil pi'oducers of Pennsyl- vania. Their executive committee the next year said the people were on " the verge of bankruptcy." ' The railroads were no happier than the laborers, the pro- ducers, the manufacturers, or the merchants. As early as 1S79 Vanderbilt II. declared that the oil business of the rail- roads — worth 530,000,000 a year — had been destroyed. " I think the business is gone." ' In 1892 a number of refiners and producers of Pennsyl- vania, in a formal appeal to Governor Pattison, asked him to investigate the causes which were working "to the injurious depression if not the ultimate destruction of a great industry." In the same year mutterings of a turbulent discontent and threats of violence and the destruction of property, repeating those of 1ST2, were heard again in Pennsylvania and in Ohio, which had become an oil-producing State. "Many of the oil producers," a member of their protective association in Ohio said, in the spring of 1892, "are in a bad way. They are at ' Testimony, Commonwealth of Pennsylvania vs. Pennsylvania Railroad et al., 1S79, p. m. -Testimony, Trusts, Congress, 18S8, pp. 18, SS, G5, 89, 111. -W. H. Vanderbilt, New York Assembly "Hepburn" Report, 1879, pp. ISBt, 1669. Testimony, Trusts, Congress, 1888, p. 218. THE OOLDEN HOUSE 457 that point that they don't know just where their next sack of flour is coming from, and I am not surprised at anything they may do." This area of low pressure, following the habit of American storms, made itself felt abroad in bankruptcies and falling wages from Scotland to Baku and beyond. Meanwhile the little nest-egg of nothing of the group which came into the field in 1862 grew to $1,000,000 in 1870 ; to 82,500,000 in 1872; to $3,500,000 in 1875; to $70,000,000 in 1882; and in 1887 to a capital of $90,000,000, which the New York Legis- lature reported in 1888, " according to the testimony of the trust's president," to be worth " not less than $148,000,000." ' Before the trust was dissolved in name, in 1892, and the "trustees" betook themselves to the greater seclusion of sep- arate corporations, acting in concert, its stock sold as high as 185, a valuation of $166,500,000 for the whole. Its dividends had been $10,800,000 a year for several years. These ducal incomes and the vaster sums accumulated as un- divided profits made themselves visible in the progressive embonpoint of tlie capitalization. In the six j'ears (1876-81) preceding their taking the veil as trustees their net earn- ings added up the total of $55,000,000. In the next six years (to 1888) the dividends alone — -not the net earnings — were more than $50,000,000." These did not absorb their profits. In one year they spent $8,000,000 out of their prof- its for construction, besides making the regular payments to stockholders.' " All this vast wealth," the New York Legislature said, '' is the growth of about twenty years; this property has more than doubled in value in six years, and with this increase the trust has made aggregate dividends during that period of over $50,- 000,000. It is one of the most active," the report continued, "and possibly the most formidable moneyed power on this continent." * ' Report, Trusts, New York Senate, 1888, p. 9. -Same, pp. 9, 10. 2 Testimony, Corners, New York Senate, 1883, p. 679. ■< Report, Trusts, New York Senate, 1888, pp. 9, 10. 458 "NOT SaSINESS" "This is an immense property," says tiie Interstate Com- merce Commission, "... and it gives an immense power which is capable of being so employed as to put all competitors at a great and perhaps ruinous disadvantage." ' For the first time the New York investigation of 1888 re- vealed that it was only the beginning of the truth that these hundreds of millions were controlled by " trustees." It now became known that some one or more of the trustees owned personally more than half of every concern in the trust, and of the best ones owned all. "These eight trustees control all these ninety millions of property scattered over the United States?" the president of the trust was asked. "They have as trustees, and they have as individual owners both." ' In corroboration of this testimony the trust furnished the New York Senate Committee of 1888 a " list of corporations, the stocks of which are wholly or partially held hy the trus- tees of the Standard Oil Trust." In this list, under the head of "New York State," appears this: "Capital stock, §5,000,- 000. Standard Oil Company of New York, manufacturers of petroleum products. Standard Oil Trust ownership, en- tire." " But when the company was threatened with the for- feiture of its charter by the proceedings before the Attorney- General in May, 1894, its pi-esident made oath as follows: "The Standard Oil Company of New York never permitted its stock to be transferred to trustees." ' Even this ownership by eight men is not the whole of the truth. The eight trustees have a ruling power within them- selves. An examination of the personnel of the board at the ' Interstate Commerce Commission Reports, vol. i., p. 722. -Testimony, Trusts, Neiv Yorlv Senate, 1888, pp. 398, 407, 411, 412, 415, 419- 43,594. 'Same, p. 571. ■■Before the Attorney-General of New York. In the matter of the application of the Central Labor Union and others to the Attorney-General to have him apply to the Supreme Court for leave to begin action against the Standard Oil Company of New York to vacate the charter thereof. Affidavit, president Standard Oil Company, May, 1894. RICHER THAN THE BANK OF ENGLAND 459 beginning, middle, and end of its career as a board shows four men always there. This agrees with the remark reported in the press to have been made by the solicitor of the trust upon its ostensible dissolution in 1892: "A majority of the stock being held by four men." A friendly journal, the New York Sun, of April 25, 1889, in an editorial paragraph concerning the wealth of one of the trustees, said: "His regular income is twenty millions of dollars a year. That makes him the richest man in the United States — perhaps the very richest in the world." This is nearly three times the dividends paid in 1892 to all its stockholders by the Bank of England. The Bank of England has built up this earning power by two hundred years' work at the head of the finances of the greatest empire of history. This American wins thrice its dividend capability in less than a generation by contriving and managing an institution which he says does not do any business. Another entirely friendly paper, with sources of information of the very best, put his income two years later at $30,000,000 a year.' No denial of the Sun's statement was attempted, and the Sun never with- drew or modified its figures. Shortly after the secretary of the trust gave, in a public interview, a statement of the in- come of its principal members. That of one of them he put at $9,000,000 a year ; his own at $3,000,000. This wealth is as much too vast for the average arithmetical comprehension as the size of the dog-star, 400 times larger than the sun. These incomes are sums which their fortunate owners could not count as they received them. If they did uothino- but stand all day at the printing-presses of the Treas- ury Department while the millions eaine uncrinkled out in crisp one-dollar greenbacks, or worked only at catching the new dollars as they rolled out from the dies of the Mint, they could not count them. If they worked eight hours a day, and six days a week, and fifty -two weeks in the year, they could not count their money. The dollars would come faster than ' New York ifail and Express, November 12, 1S90. 460 "NOT BUSINESS" their fingers could catch tliem ; the dollars would slip out of their clutch and fall to the floor, and, piling up and up, would reach their knees, their middle, their arms, their mouth, and Midas would be snuffed out in his own gold. Commodore Vanderbilt, Parton tells us, was fort^'-four years old before he was worth $400,000. In the next thirty years he increased this to over $100,000,000 — perhaps twice that ; no one knows. Yanderbilt had to multiply this nest- egg of his forty-fourth j'ear 250 times, but one of these " trus- tees" will be a billionaire when he has turned himself over only ten times. Poor's Railroad Manval shows these men and their associates to be presidents or directors in thousands of miles of railroads, valued at hundreds of millions. Their names were prominent in the railroad " deal " of 1892 and 1893, which had for its end to put the whole of Kew England under one hand, controlling both its land and water connec- tions with the rest of the country. They stand at the receipt of custom at the railroad gates to the oil regions; to the coal- fields of Pennsylvania, Ohio, Kentucky, West Virginia, Illi- nois; the copper, gold, and silver mines of the West; the iron mines of the West and South ; the turpentine forests and the lumber regions and cotton fields; the food-producing areas of the Mississippi basin; the grazing lands of the plains. They are owners in the principal steamship line between America and Europe, and in the " whalebacks," which appear destined to drive other models out of the freight traffic of the lakes, and have begun to appear on the Eastern and Western oceans, to capture the carrying business of the world. Everj' dollar for the construction of a State building at the World's Fair was advanced by one of them, as the principal journal of the State announced, and it referred to him as " the man who breathes life into its East coast towns, and the lifting of his pen by his hand is like turning upsidedown the horn of plenty." They are '• in" the best things — telegraphs, the gas supply of our large cities, street-railways, steel mills, ship- yards, Canadian and American iron mines, town sites. Ore dug out of their own iron mines at the head of Lake Supe- KINGS INCOGNITO 461 rior is carried over their own railroad to their own furnaces and mills. It rolls along until that which began to move as ore lies at the docks of their ship-yards as a finished vessel, cut out of the mountains, as it were, at one cheap stroke, or is loaded in the cars in some perfected shape of steel, as steam radiators or what not. They feed entire mountain ranges into their mills with one hand, and with the other despatch the product in their own cars and ships to all markets. Be- trayal, bankruptcy, broken hearts, and death have kept quick step with the march of the conquerors in iron as in oil. They are in the combination in anthracite coal, with which the acquisition by an American syndicate of the Nova Scotia coal deposits is closely connected. Theirs is the largest share in the natural-gas business in Pennsylvania, Ohio, ISTew York, Indiana, Illinois. They are in the combination which controls lead, from pig to white lead, and turpentine and linseed-oil and paints. " Its members," it was said in the application to the At- torney-General of New York, in 1894, for a forfeiture of one of their charters, " are now presidents and directors in 33,000 miles of road, one -fifth of the total mileage in the United States. Its surplus is invested in banking, in natural and manufacturing gas companies, in iron ore beds and coal beds and crude-oil production, in lead and zinc, in turpentine and cotton -seed oil, in steel, in jute manufacture, in ocean steam- ships, in palatial hotels, in street-railroads." Most of their interests are in public functions, railroads, pipe lines, telegraphs, postal contracts, steamers, municipal franchises, and the like ; but it is impossible to know their full extent with our present crude means for enforcing the truth that property is power and that civilization endures no irresponsible anonymous power. The corporation is an ao'ency by whicli the capitalist can do business in ambus- cade. " They are all in our company," said the manager of a very important public agency, " but their names do not ap- pear." It is not out of deference to the obsolete idea that such matters are private business that all the details of their 462 "NOT BUSINESS-" possessions are not given, but only because they are not known. "There is no such thing as extemporaneous acquisition," Daniel Webster said ; but he spoke of eloquence, not of the perfected modern commerce. Selligue, the French genius to whose discoveries nothing of equal importance has been added, is not dignified with an entry in the encyclopsedias or bio- graphical dictionaries. For " Colonel " Drake, who struck oil, a pension had to be provided by his friends in the regions which he had filled with fountains of wealth. Mr. Van Syckel, who first proved the pipe line to be practicable, died in Buffalo, paralytic, helpless, and poor. The "age of oil" could not have come without the oil well and the drill and derrick, and these in America are the lineal descendants of the first salt well, drilled and whittled out of the rocks by the Euffner brothers, in 1806, in the "Great Buffalo Lick" of the Kanawha. Their first "drill" was a great sycamore -tree, four feet thi'ough, hollowed out, set on end on the ground in the lick, and gradually lowered as the earth and stone within were dug away by a man inside. "When they came to the rock, which they could not blast be- cause it was under water, they hung a roughly-made iron drill by a rope to a spring pole and went inch by inch through the rock, "kicking down" the well. Metal tubes were not to be had, but tlie Yankee whittler solved the problem of tubing the well. Two slender strips of wood were whittled into two long, thin, half tubes, and tied together. This is the genesis of the bored "well" and the "drill and derrick." ' It took eighteen months to accomplish this, but the wonder is that it was done at all "without preliminary study, previous expe- rience or training,without precedent, in a newly-settled country without steam-power, machine-shop, skilled mechanics, suita- ble tools or materials." These almost-forgotten men, shrewd, patient, undauntable, ' Dr. J. P. Hale, of Charleston, West Virginia, in the volume prepared by Prof. SI. L. ilaurj, and issued by the State Centennial Board, on the resources of the State. Quoted by S. F. Peckham, United States Census, 1885, p. 6. MOW NOT TO SUCCEED 463 were the pioneers of the skilful well-borers who have gone forth from the Kanawha wells all over the country to bore wells for irrigation on the Western plains, for cities, factories, and private use, for salt, for gas, for geological and minera- logical explorations, and for oil. " Billy Morris," of the Ka- nawha borings, invented a tool simple enough, but not so sim- ple as to be described here, called the "slips" or "jars," which has done more for deep boring than anything except the steam-engine, and for which, considering the part played in the life of man by oil, gas, water, brine, and other wells, we are told he " deserves to be ranked with the inventors of the sewing-machine, reaper, and cotton-gin."' But "Uncle Billy" made a free gift to the well-diggers of the world of his invaluable "slips," and slipped into poverty and an un- known grave. To Joshua Merrill, more than to any one else, belongs the honor of bringing the manufacture of oil in America to its perfection.' He made better oil than any one else, and he loved his work. " I was thirty-two years in the oil business. It was the business of my life." ' But he had to dismantle his refinery, and join the melancholy procession of two thousand years of scouts, inventors, pioneers, capital- ists, and toilers who march behind the successful men. Yet, strange to say, these successful men did not discover the oil, nor how to " strike " it. They were not the lucky owners of oil lands. As late as 188S they produced only 200 barrels a day — about 1 in every 3000 — "an infinitesimal amount," their president said." They did not invent anj' of the processes of refining. They did not devise the pipe line, and tliey did all they could to prevent the building' of the first pipe line to the seaboard, and to cripple the successful experi- ment of piping refined oil.' They own all the important re- ^ Petroleum and Its Product.% bj- S. F. Peckliam, U. S. Census, ISSo, p. 7. ^S. Dana Hayes, quoted in Henry's Eaj-ly and Later Histoi-y of Petroleum, p. 186. = Testimony, Josliua ilerrill, Trusts, Congress, ISSS, p. SW. •■Testimony, Trusts, Xew York Senate, 1888, pp. 386, 425. 5 Testimony, Trusts, Congress, 1S88, p. 82. =See p. 165. 464 "MOT SUSINJESS" fineries, and yet they have built very few. They did not pro- ject the tank-car system, which came before them,' and have used their irresistible power to prevent its general use on the railroads, and successfully.' They were not the first to enter the field in any department. They did not have as great capital or skill as their competitors.' They began their career in the wrong place — at Cleveland — out of the way of the wells and the principal markets, necessitating several hundred miles more of transportation for all of their prod- uct that was marketed in the East or Europe.* They had no process of refining oil which others had not, and no legiti- mate advantages over others.' They did not even invent the rebate. They made oil poor ' and scarce ' and dear.* The power to chalk down daily on the black-board of the lls^ew York Produce Exchange the price at which people in two hemispheres shall buy their light has followed these strokes of " cheapness " : 1. Freight rates to the general public have been increased, often to double and more what is paid by a favored few." 2. The construction has been resisted of new lines of. trans- portation by rail," 3. And pipe." This has been done by litigation," by influ- ence, by violence," even to the threatened use of cannon," and by legislation, as in Ohio and Penasylvania, to prevent the right of eminent domain from being given by " free pipe-line bills " to the people generally. 4. The cost of pipeage has been raised." 5. Kivers and canals have been closed." ' Testimonv, Trusts, Congress, 1888, p. 258. " See chs. si. and svii. 2 New York Assembly "Hepburn" Keport, 1819, p. 44. Testimony, same, pp. 2623, 2645. Testimony, Trusts, Congress, 1888, pp. 223-26, 542, 643, 548. 'New York Assembly "Hepburn" Report, 1879, p. 43. Testimony, Trusts, Congress, 1S8S, p. 213. 'New York Assembly "Hepburn" Report, 1879, p. 712. Testimony, Comraou- wealth of Pennsylvania vs. Pennsylvania Railroad et al., 1879, p. 302. « See p. 405. ' See pp. 61, 153. » See p. 420. ' See pp. 49, 217. '" See p. 306. " See p. 108. " See pp. Ill, 291, 446. '^Seep. 291. "Seep. 162. "See pp. 118-27. " See pp. 97, 224. A BILL OF PABTWULASS 465 6. Oil has been made to run to waste on the ground.' 7. The outflow of oil from the earth has been shut down.' 8. The outflow of human energy that sought to turn it to human use has been shut down b}' restricting the manufacture by the combination and by others, by contract,' dismantling,' and explosion.' 9. High fees have been maintained for inspection," and tlie inspectors have been brought into equivocal relations with the monopol}'.' 10. The general use of tank-cars and tank-stearaers has been prevented. ° 11. The people have been excluded from the free and equal use of the docks, storehouses, and other terminal facilities of the railroads in the great harbors of e.xport.° 12. Inventors and their better processes have been smoth- ered.'° 13. Men have been paid more for spying than they could earn by working." 14. "Killing delay" has been created in the administration of justice."' All are poorer — oil-producers, land-owners, all labor, all the railroads, all the refiners, merchants, all the consumers of oil — the whole people. Less oil has flowed, less light shone, and there has been less happiness and virtue. In every one of the few intervals, says Hudson, during which oil could flow freely to Pittsburg, all the businesses connected with it were active and expanding." When the trust's secretary was asked for the proper name of the combination, his reply was: "The Lord only knows: I don't." "An indescribable thing," he said again." " Do you understand the practical work of refining as a re- finer?" he was asked. ■ See pp. 106, 164. ^ See pp. 107, 154. ' See pp. 62, M. ■•See pp. 42, 72, 188. = See p. 251. 'Seep. 216. ' See pp. 216, 413. « See pp. 189, 228, 437. ' See pp. 102, 140. ■" See pp. 182-98. " See p. 298. " See pp. 149, 447. " Railways and the Republic, by J. F. Hudson, p. 77. » Testimony, Comers, New York Senate, 1883, pp. 637-42. 30 466 "NOT BUSINESS" " I do not. ... I have not been inside a refinery in ten years." ' " Two mills a ton a mile for fi%-e hundred miles would be a dollar a ton ?" "I am not able to demonstrate that proposition." " You have some arithmetical knowledge ?" " I cannot answer that question." ' He could not state what proportion of the oil trade is now controlled by the trust, lie had never looked into that ques- tion, lie did not know who knows these things.^ " You own the pipe line to JSTew York ?" " Yes, sir." " What does it cost you to do business on that pipe line ?" " I do not know anything about it. ... I have never been in the oil regions but once in my life. ... I am not a practical oil man. . . . For perhaps eight years I have given absolutely no attention to the details of our business." ' Asked upon another occasion, before the Pennsylvania Leg- islature, about the accounts of the company when he was its secretary, he said : " I am not familiar with the accounts." " '• I am a clamorer for dividends. That is the only function I have," said another trustee." "When was j-our last rate given you, the i-ate at which you are now being carried (on the Kew York Central) ?" " I could not tell." ' The secretary had testified that this associate attended to getting the rates of freight ; but the latter avowed that he could not remember "any rate" that he had paid "at an}' time." But a little later he who could riot remember any rate he had ever paid was able to tell the committee, off-hand, the exact rate of freight on oil by steamer from Batoum in Kussia to ' Testimony, Trusts, Congress, 1888, p. 298. =Same, p. ISi. ^Same, p. 295. "Same, pp. 295, 778-80. ^ Investigation of Kelations of Standard Oil Company to the State, 1883, p. 473. ' Testimony. Xew York Assembly "Hepburn" Report, 1879, p. 2665. 'Same, p. 2607. IGNORANCE IS POWER 467 Livei'pool, and knew the rate from the wells at Baku by rail to the sea at Batoum ! ' " Had you ever been interested in the refinery of oil in any manner when you first became connected with the oil busi- ness ?" another trustee was asked. " Never." " Or the production of oil ?" "JSTever." He was a railroad man, and had been taken into the com- bination for his value as such ; but when he was asked if he could tell any of the rates of freight his company had paid, he said : "I cannot."' " What is your business and where do you reside ?" another of the trustees was asked by the State of New York. " I decline to answer any question until I can consult counsel." ' " What is the capital stock V was asked of another. " I do not know." " How much has the capital been increased since ?'' "1 don't know." "Where are tiie meetings of the Standard Oil Company held?" " I don't know." "How many directors are there?" " I don't know." " Do they own any pipe lines ?" "I don't know." "I don't know anything about the rates of transporta- tion." " " What quantity of oil was exported by the different con- cerns with which you were connected from the port of New York in 1881 ?" the president was asked. " I do not know." > Testimony, Trusts, Congress, 1888, pp. 296, 322, 787, 788. ' Same, p. 365. ^ Testimony, New Yorlc Assembly " Hepburn " Report, 1879, p. 2603, •* Same, pp. 2604-14. 468 "A'OT BUsmuSS" " How many millions of barrels of oil were refined by such concerns in the vicinity of New York in ISSl ?" " I don't know how much was refined." "Did not the concern with which yoii were so connect- ed purchase over 8,000,000 barrels of crude petroleum in 1881 ?" " I am unable to state." He was asked to give the name of one refinery in this country, running at the time (1SS3), not owned or substan- tially controlled by his concern. " I decline to answer." ' He was asked if he would say the total profits of his trust's companies for the last year (1887) were not as much as $20,000,000. " I haven't the least knowledge on that subject." ° Phrenologists are right. Memory is not to be ranked with the mental attributes of the highest importance. The head of the New York Central could not tell when a stock dividend of something like $46,000,000 had been declared on one of his railroads — and a $46,000,000 dividend is something worth remembering. "I don't know. . . . I don't remember." ' It is lucky for the rest of us that these great men forget some- thing. One of the chiefs of the oil combination was a witness in Cleveland in 1887 in a suit by the State of Ohio against cer- tain railroads. "What business in connection with the oil business is done in the building in which the oil trust has its oflice in New York?" "I do not think I could state just what business is done in that building, I am sure." Asked on the witness-stand in the Buffalo explosion case when it was he formed the "trust " with $70,000,000 of capi- tal, the president replied: "I am unable to state," and he could not sa}- where its articles of agreement were, nor who > Testimony, Corners, Xew York Senate, 1883, pp. 929, 931, 932. 'Testimony, Trusts, Xew York Senate, 1888, p. 417. 2 Testimony, New York Assembly " Hepburn " Report, 1879, p. 1636. MEMORANDUMS THAT WERE DESTROYED 469 lias control of it. When qnestioned before the Interstate Commission he could not tell within $25,000,000 how much business they were doing a year." These men keep no books. The whole arrangement is just a happy family', like Barnum's monkeys, birds, cats, dogs, and mice in the same cage. "It is a business of faith," one of the ruling four puts it. Another was asked about the by-laws under which he and his associates transacted their business. " I don't know that I have seen a copy," he replied, and as to where it was he was able only to " sup- pose." ' When the committee of the Legislature called for the books recording the transactions of the trust and its attorneys and committees, there were practicallj' none to produce. All there was in the way of a record of transactions of a magni- tude beyond those of an\' other commercial institution in this country or the world were a few pages of formal entries from which nothing could be learned. The executive com- mittee received and passed upon the disbursements of money by the treasurer, and the reports of sub-committees and of members, who had sweeping powers of attorney, by which these countless millions were kept rolling themselves up into more, but it never kept any records. "I have no knowledge of any formal record having been made," one of them said. The reports were " either verbal or on pieces of paper. ... I think it was memorandums," he continued, and the memorandums were " undoubtedly de- stroyed." They were transcribed into the records of the trustees, he said, but the search of the committee showed that the transcription was a " skeleton," consisting mainly of the mere phrase, " Minutes of the executive committee ap- proved." " The real minutes do not appear upon the book," Senator Ives, of the committee, said. " There is no book to produce ?" " There is no book." ' Tcstimonv, Eice cases, 51-60, Interstate Commerce Commission, ISST, pp. 366, 368. ' Testimonv, Trusts, New York Senate, 1888, pp. 455, oVT. 470 "NOT BUSINESS'' " And there is no memorandum ?" "There is no memorandum." ' " Does the trust keep books ?" the " president " was asked by Congress. " No, we have no system of book-keeping." On further pressure he said that the treasurer had "a rec- ord to know what money comes in." " You have never seen those books ?" " I do not think 1 have ever seen those books." " Has any member of the nine" (trustees) " ever seen those books?" " I do not know that they have." ^ Simplicity is said to be always a characteristic of greatness. What could be simpler, and so greater, than this ? Tlie ele- ments of success are only — 1. Not to know anything about the business, 2. To keep no books. 3. To have " a record to know what money comes in," and 4. Never to look at it. Finally, the operations of these men have, in their own language, not been "business." Its secretary told Congress that the " trust" was " not a business corporation," ° and an associate declared in court tliat it " cannot do business." The report of the New York Legislature shows that on Oc- tober 3, 1SS3, the president had b^' a formal instrument been made the attorney of the trust to sign and execute all the contracts made hy it. Tiie same instrument in express terms confirmed the execution of contracts heretofore signed by him, showing that he had been making contracts.* "Those gentlemen" (the members of the trust who hoKT its power of attorney) "do actually' execute contracts involv- ing pretty large amounts, sometimes without a formal resolu- tion of the Board of Trustees, do they not?" ono of them was asked. • Testimony, Trusts, New York Seuate, 1SS8, pp. 576-89. = Testimony, Trusts, Congress, 1S88, pp. 391, 392. = Same, p. 294. •Trusts, New York Senate, 18SS, p. 658. A BUSINESS QUESTION 471 " Undoubtedly they do." ' Following their employers, the lawyers in the Pennsyl- vania Tax case for the oil combination argued that its opera- tions were not business within the meaning of the tax law. If the "no money" of 1862 has become the control, in one industry alone, of $160,000,000 in 1892 by methods that are not " business," what are they ? Note. — The principal members of the oil combination were beard at great length in its defence before the committee of Congress investigating trusts in 1888.' Their testimony has been frequently used in our pages. But they felt that their case needed further elucidation, and asked the committee to hear them again. The committee declined to bear them again " explain or contradict," as they offered to do, but by printing their communication gave them the benefit of their denials and explanations.^ Their offer was mainly to go again over the ground that the "South Im- Ijrovement Company never did any business," that the combination " ob- tained no preferences " on the ra'lroads, that they had cheapened transpor- tation, improved machinery, made better oil at less cost, and so on. The chief officers and owners bad been heard on all these points to the extent of hundreds of pages of testimony. But though it did not recall them to the witness-stand, the committee, in addition to printing their communi- cation, printed most of the documentary evidence they desired to submit. This covered nearly two hundred pages more.'' The examination, which any one can make, of this record discloses an interesting fact concerning the iDroof, and the trust's offer to prove, which can best be shown in parallel columns : THE TRUSTS OFFER TO PROVE. It offered the evidence of the third vice-president of the Pennsylvania Railroad to "show the South Im- provement Company never did any business, and its charter was repealed in 1873." THE PROOF. But the testimony of this witness states that his connectiou with the oil business of the Pennsylvania Eail- road — the principal raih"oad in that scheme — did not begin until 1873.' 1 Testimony, Trusts, New York Senate, 1888, p. 580. "- Testimony, Trusts, Congress, 1888, pp. 266, 287, 314, 365, 387, 395, 526, 537, 565, 627, 768, 790, 799. ^House of Representatives, 50th Congress, 2d Session. Report No. 4165, Part II., Appendix C, p. 33. * Trusts, Congress, 1888, pp. 174-210, 801-951. * Testimony, Commonwealth of Pennsjlvania vs. Penns}'lvania Railroad et al., 1879, printed in Trusts, Congress, 1888, p. 195. 472 'NOT BUSINESS' It offered the same evidence to prove that the same rebates granted it by the contract of October 17, 1877, "were also granted to every shipper who contracted to do all his business over the Pennsylvania Rail- road." It offered the evidence taken in the Buffalo Explosion case, to sliow that ■ ' C. B. Matthews testified falsely "in testif jing that it was sworn to that the members of the oil combination on trial employed detectives in Mat- thews' refineries, and that the detec- tive was some time in Matthews' em- ploy', and made his report to the lawyer of the trust, and he got his pay from this lawyer. It offered " to prove that C. B. lyiatthews testified falsely in saying that it was proved b3' a witness " that the Rochester representative of the oil combination said that the principal company in it "would sue But this witness stated that his road would give other shippers as low rates as to the oil combination, "if they would guarantee the same quantity — not otherwise — under that contract";' and the contract itself states that no otlier shipper should have the same rebate — "commis- sion," it is called — unless his business gave the road "the same amount of profit you realized from our trade." '' No shipper could got the same rates b3' giving " all his business." He must give "the same quantity" — a totally different proposition. The evidence shows that this was what was sworn to : "I have now a detective agency here " (Buffalo). " I employed L B . At the time he was in my employ he was em- ployed at the works of the Buffalo Lubricating Company " (Matthews' company). " He made reports to me, . . . I forwarded copies — one to New York, one to Rochester. . . . The one forwarded to Now York was ad- dressed to " (the lawyer of the oil trust). " I met" (this lawyer, naming him) "at New York City, at No. 44 Broadwajr, which is the office of the " (oil trust). ' ' I received my pay from " (liim). ' ' My instructions from " (him) " were in writing." ' This was what "was proved hy a witness,'' and referred to by Mat- thews. " He " (the Rochester rep- resentative of the oil combination) "said he thought they" (Matthews' company) "would notsurvive By ' Testimony, Commonwealth of Pennsylvania vs. Penusylrania Railroad et al, 1879, printed in Trust?, Congress, 1888, p. 206. » Same, p. 208. ' Testimony in Buffalo Explosion case, printed in Trusts, Congress, 1888, p. 804. A MISFIT OP PROOF 473 Matthews once a montb, or once a week, if necessary, to squeeze Lim out." the time they got through with all the suits that they " (the oil comhina- tion) " would bring, the Buffalo Lu- bricating Company would be pretty much used up. . . . He didn't know as they would gain anything really, but they would embarrass them by bringing these suits, and if it was necessary they would bring them once a month — yes, they would bring them once a week." ' Similarly, throughout, the trust's offer to prove falls when confronted with its own proof. Many more instances could be given, but more than one instance is not needed. ' Deposition of Albert N. Keynolds, Buffalo Lubricating Oil Company, Limited, ts. Everest & Everest. Supreme Court, New York, Erie County, City of Buffalo, August 29, 18S4. CHAPTER XXXin THE SMOKELESS REBATE With searching intelligence, indomitable will, and a con- science which makes religion,' patriotism, and the domestic virtues but subordinate paragraphs in a ritual of money wor- ship, the mercantile mind flies its air-line to business suprem- acy. That entirely modern social arrangement — the private ownership of public highways — has introduced a new weapon into business warfare which means universal dominion to him who will use it with an iron hand. This weapon is the rebate, smokeless, noiseless, invisible, of extraordinary range, and the deadliest gun known to commer- cial warfare. It is not a lawful weapon. Like the explosive bullet, it is not recognized by the laws of war. It has to be used secretly. All the rates he got were a secret between himself and the railroads. " It has never been otherwise," tes- tified one of the oil combination." The Chevalier Bayard de- clared proudly, as he lay on his death-bed, that he had never given quarter to any one so degraded and unknightly as to use gunpowder. Every one would close in at once to destroy a market combatant who avowed that he employed this wicked f)rojectile. The apparatus of the rebate is so simple that it looks less like a destroying angel than any weapon of offence ever known. The whole battery consists only of a pen and ink and some paper. The discharge is but the making of an entry — but the signing of a check. But when the man who commands this simple enginery directs it against a business ' Testimony, New Tork Assembly " Hepburn " Report, 18(9, p. 2668. EMPTY PENITENTIAJilES 475 competitor yon can follow the track of wreckage like the path of a cyclone, by the ruins which lie bleaching in the air for years. The gentlemen who employ it give no evidence of being otherwise engaged than in their ordinary pursuits. They go about sedate and smiling, with seemingly friendly hands empty of all tools of death. But all about them as they will, as if it were only by wish of theirs which attend- ant spirits hastened to execute, rivals are blown out of the highways, busy mills and refineries turn to dust, hearts break, and strong men go mad or commit suicide or surrender their persons and their property to "the skilful artillerists. "And in the actual practice of daily life," says Ruskin, " you will find that wherever there is secrecy, there is either guilt or danger." " "When did you discover the fact that these rebates had been paid?" one of the victims was asked. " We never discovered it as a fact until the testimony was taken in 1879. . . . We always suspected it ; but we never knew of it of our personal knowledge, and never would reall}' have known it of our personal knowledge. ... I had no idea of the iniquity that was going on." ' Nothing so demolishing was ever so delicate and intangible as this, for its essence is but a union of the minds of a railroad oQicial and some business friend, perhaps a silent partner, bent on business empire. The model merchant, fortunate in having a friend willing so to \ise a power sovereigns would not dare to use, walks the public way, strong in his secret, and smiles with triumph as all at whom he levels his invisible wand sicken and disappear. " He has the receipt of fern- seed. He walks invisible." Men who hunt their fellow-men with this concealed weapon always deny it, as they must. To use it has always been a sin, and has been made a crime in every civilized State. Under United States law it is, since 18S7, an offence punishable with imprisonment in the penitentiar}-.'' Moral ideals are not born in legislatures. When an act attains by a law the distinction of ' Testimony, Trusts, Congress, 1888, pp. 215, 223, 22t). *' Interstate Commerce Law, sec. 10. 476 TEE SMOKELESS HEBA.TE being made a crime, it is already well on its way to extmc- tion. It is made infamous by law, because it has already be- come infamous before the conscience and honor of men. It was not the prohibition of highway privilege by the Constitu- tion of Pennsylvania or the laws of the United States which made the rebate an iniquity. This legal volley is but a sa- lute to the established conscience. Tiie question most often pressed before all the many legis- lative and judicial inquests held upon the dead bodies which strew every field of the oil industiy has been whether the extraordinary powers which the invention of the locomotive and the transformation of public highways into private prop- erty had given railwaj's over the livelihoods of the people had been used to make it impossible for any but a preferred few to live. One of the successful men disposed of the evidence that these powers had been so used by styling it before the com- mittee of Congress of 1888 as the " worst balderdash," and before the Xew York Legislative Committee of 1888 as "irre- sponsible newspaper statements," "a malignity and mendac- ity that is little short of devilishness." The secretary of the oil trust waved it away as " all this newspaper talk and flur- ry." The president knows nothing about the existence of such privileges, except that he has "heard much of it in the papers." And yet another of the trust in the North Ameri- can Hevieio of February'-, 1883, similarly describes tlie accusa- tion as " uncontradicted calumny," to which, he regrets to sa}^ " several respectable journals and magazines lent themselves." After taking 3700 pages of evidence and sitting for months, the committee of 1879 of the New York Leo-islat- ure said in their report: " Tlie history of this corporation is a unique illustration of the possible outgrowth of the pres- ent system of railroad management in giving preferential rates, and also showing the colossal proportions to which monopoly can grow under the laws of this countrj-.' . . . The 1 Xen- York Assembly " Hepburn " Report, 1S79, pp. 40-41. THE ONLY WHITEWASH 411 parties whom they have driven to the wall have had ample capital and equal ability in the prosecution of their business In all things save their ability to acquire facilities for trans- portation." ' The committee of the Ohio Legislature which took the evidence of the treatment of the Marietta independents by the railroads' is, so far as the author knows, the onl}' body of all the legislative and judicial tribunals that have been in- vestigating for the past thirty years which has found the re- lations of the railroads and the oil combination to be proper. It used the words " public," " uniform," " in accordance with law," "equitable," " no special discriminations or privileges" to describe the conduct of the common carriers in that case. But in doing so it had to except from these exculpations the railroad which originated the attack on the independent re- finers, ?.nd the rates of which controlled the others, as it was the initial road. It had also to admit that the oil combina- tion had received " better rates," but defended them on the ground that its shipments were larger. These two exceptions are doors wide enough to admit every possibility of the re- bate. The Secretary of State for Internal Affairs of Pennsyl- vania made an investigation in 1878 on the complaint of citi- zens. He reported to the Attorney-General that no case had been made out " beyond the ordinary province of individual redress." He was hung in effigy by the citizens, and the evi- dence he took remains, like that of the Oliio Committee of 1879, a valuable repositorj' of facts from which students can draw their own conclusions. More than any others the wrongs of the oil indnstr}' pro- voked the investigations by Congress from 1872 to 1887, and caused the establishment of the Interstate Commerce Com- mission, and more than any others they have claimed the at- tention of tlie new law and the new conrt. The cases brought before it cover the oil business on practically every road of any importance in the United States — in New England, the 1 New York Assembly " Hepburn " Report, 1S79, p. 44. ' See p. 202. 478 TEE SMOKELESS BEBATE Middle States, the West, the South, the Pacific coast; on the great East and West trunk roads— the Pennsylvania, tha Erie, the Baltimore and Ohio, the New York Central, and all their allied lines; on the transcontinental lines — the Un- ion Pacific, the Central Pacific, the Southern Pacific ; on the steamship and railroad association controlling the South and Southwest. They show that from ocean to ocean, and from the Gulf of St. Lawrence to the Gulf of Mexico, wherever the American citizen seeks an opening in this industry, he finds it, like the deer forests and grouse moors of the old country, protected by game-keepers against him and the com- mon herd. The terms in which the commission have de- scribed the preferences given the oil combination are not ambiguous: " Great difEerence in rates," "unjust discrimina- tion," "intentional disregard of rights," "unexcused," "a vast discrepancy," " enormous," " illegal," " excessive," ' " ex- traordinary," "forbidden by the act to regulate commerce," "" " so obvious and palpable a discrimination that no discussion of it is necessary," "wholly indefensible," " patent and provok- ing discriminations for which no rational excuse is suggest- ed," " obnoxious," " disparity . . . absurd and inexcusable," "gross disproportions and inequalities," ° "long practised," "the most unjust and injurious discrimination . . . and this discrimination inured mostly to the benefit of one powerful combination."* This was what the Interstate Commerce Commission found all along the record from 1887 to 1893. When one of those who got the benefits so characterized was before the New York Legislature in 1888, he said : "I know of no discrimination in the oil trafiic of any kind since the passage of the Interstate Commerce Act." ' EiceTO. Louisville and Nasliville Railroad ct al. Interstate Commerce Commis- sion Reports, toI. i., p. 722. Trusts, Congress, 1888, pp. 675-84. - Scofield v$. Lake Shore and Michigan Southern Railioid. Interstate Com- merce Commission Reports, vol. ii., p. 90. ' Rice, Robinson and Witherop vs. Western New York and Pennsylvania Rail- road et at Interstate Commerce Commission Reports, vol. iv., p. 131. *Same. ADJUDICATED FACTS 479 " Do you use any means for the purpose of avoiding the effect of that new law ?" " None whatever." ' But the people have found that the explicit prohibitions of the Interstate Commerce law were of no more protection to them than the equally explicit prohibitions given long before by the State constitutions and laws, the common law of the court, and by the still older common law of right, which the statute was created to enforce. The "unjust," "enormous," " illegal " differences in freights by which the public was ex- cluded were got from the railroads after, as before, Congress, obedient to an aroused and universal demand, had passed a special statute and created a special tribunal to prevent and punish this special sort of crime. This is the adjudicated fact. This " uncontradicted calumny," " worst balderdash," " ma- lignity and mendacity," " irresponsible newspaper state- ments " proves upon examination to be : 1. Testimony of unimpeached and in many cases uncontra- dicted witnesses, given under oath in legislative investigations and in court, subject to examination and cross - examination and rebuttal. 2. Eeports of State legislative committees. 3. Copies of the contracts." 4. Decision of courts, State and national.^ The South Improvement plan of 1872 is still in unrelenting operation, according to the latest news. A case is now pend- ing before the Interstate Commerce Commission,* in which charges of highway abuse even more sensational than any of those we have seen judicially proved are made against the ' Testimony, Trusts, New York Senate, 1S88, p. 597. '' South Improvement Company, p. 45 ; Amei'ican Transfer Company, p. 99 ; Rutter Circular, p. 85; Contract with Psnnsykania Railroad iu Wll, p. 89 ; Con- tract with New York Central and Lake Shore and Michigan Central Railroads, 1875 and 1S76; New York Assembly "Hepburn" Report, 1879, Exhibits, p. 175; Contract with the Erie road, same, p. 573 ; Contract in the " Agreement for an Adventure " case, p. 62. ^iSee pp. 69, 130, 146, 149, 151, 208, 219, 224, 239. * Wm. C. Bissel vs. Atchison, Topeka and Santa Fe Railroad Company et al. 480 THE SMOKELESS REBATE thirty railroads by which the oil of Ohio, Pennsylvania, and New York reaches the Pacific coast. A San Francisco oil dealer is the petitioner for relief. He recites the discrimina- tions given the oil combination on the Pacific coast before the Interstate Commerce law was enacted. Tliese were admitted by the ofiScials of the roads before the United States Pacific Railway Commission of 1887. The traflic managers of the Southern Pacific testified that the oil combination, "from the time it acquired the oil business on this coast, had lower rates than the general tariff provided, or than other shippers paid on coal oil." ' The general freight agent of the Central Pacific Railroad admitted that his road had the same arrangement, and had accepted the business "at rates dictated" by the oil combination.'' The general traffic manager of the Union Pa- cific Railroad said : " We have paid them a good deal in rebates." It was a '•' pretty large" preference. "What was the effect on the small dealer?" "I should think it would be embarrassing to the small ship- per !"= When the Interstate Commerce law went into force the oil combination introduced a patented car for the transconti- nental trade, which it claimed the sole right to use. Though the new car was to the disadvantage of the railroads, as it cost more to haul, the managers gave it lower rates than any other car and carried it back free, while they punished the shippers who gave them a lighter and better car by charging them §105 for carrying that back. The San Francisco complainant goes on to charge that a plan was concocted and put in operation by which rates were lowered whenever the combination wanted to fill its ware- houses on the Pacific coast, and as soon as they were fnll were put back again. TJiis lowering and raising of rates was " to the public sudden and unexpected." ' It was known in 1 Testiraonv, United States Pacific Railway Commission Report, 1887, p. 3301. 'Same, p. 35S1. » Same, pp. 1132-33. J See pp. 49, 200, 218. THE SOUTH IMPROVEMENT COMPANY AGAIN 481 advance only to the ring and the railroads. Before other shippers could take advantage of the lovr rates they would be raised again. The complaint recites that in pursuance of this plan, after the combination had transferred to the Pacific coast at the end of 1888 from its Eastern refineries all it needed for the next season's business, the railroads advanced the rates from 82J cents a hundred pounds to $1.25. The next May the railroads made a similar seesaw, and, he says, in December, 1892, "are still making . . . such arbitrary and sudden reductions ... to the undue advantage" of the oil combination "and to the detriment and injury of all other ship- pers." The San Francisco merchant also charges that in the interest of the Eastern refineries of the combination rates are made to prevent the large product of the oil-fields and inde- pendent refineries of Colorado and Wyoming from reaching the Pacific coast, " which needs them to furnish fuel for its manufactories, as well as for light for its residents." Simi- larly we find the Chicago and JSTorthwestern Railroad charging $105 for a ear-load of cattle from Wyoming to Chicago, while for a car of 75 barrels of oil the freight would be S3i8. In connection with these charges the press published the tele- grams, filling columns, which were said to have passed be- tween the officials of the railroads and the oil combination in the negotiation of this arrangement. In one of these tele- grams the freight agent of the Southern Pacific explains the new deal. "He " (the agent of the oil combination) " would stock up at the low rate, then notify the association of rail- roads when to advance." The advance or decline was to be " made at certain seasons of the j-ear in accordance with this supply on hand." When the negotiation was finished and the plan was agreed to, a San Francisco agent of the oil combina- tion is said to have telegraphed to its officers in New York: " I think we have managed this freight business pretty well from this long distance, especially when you think that we have secured the 90-cent rate with which to stock up from time to time." His telegram also discloses that the arrangement ex- tended to lead and linseed-oil, showing, what is well known, 31 482 TBE SMOKELESS JREBATE that tlie combinations in these articles belong to the members of that in oil. These charges are, it is to be remembered, still nnadjudicated,this published evidence is not jet substantiated. But the arrangement which is charged is in exact pursuance of that part of the South Improvement Company contract which bound the railroads to " lower or raise the gross rates of transportation . . . for such times and to such extent as may be necessary to overcome . . . competition." ' And Attorney- General Olney has been publicly informed" that during the summer of 1894 oil rates between Pennsylvania and Colorado were put down from 75 cents a hundred to 25 cents, and a few weeks later raised again to the old rate. Another increase made the rates to Denver higher, for oil, than to the Pacific coast. He has been asked to ascertain, judiciallj-, if this shuf- fling of rates was not made, like that complained of before the Interstate Commerce Commission, to allow the oil trust "to stock up at the old rate." His informants suggest that the same powers with which he has brought railway employes to trial for infractions of the Interstate Commerce law can be used against the railways. This is not all of tlie story. This patented car spoken of was a mere aggregation of old elements, as the courts held, and the patent was void. Advised by their lawyer that this would be the view the courts would have to take, com- petitors of the combination in the business of the Pacific coast, where they had been at the head until these new tricks of trade came in, introduced a car of their own of the same class. The}- thus became entitled to the same low rates and the same free return of the car as their powerful rival. This put them again on an equality in transportation. The}' had not been using these new cars long before two of them, shipped as usual from the East, failed to arrive. Their search for the missing cars put them in possession of the interesting information that a litigation, of wliich they had had no notice or knowledge whatever, had for some time been in progress, ' See p. 48. °- Titusville World, July 12, 1894. A GALLOP THROUGH THE COURTS 483 and was at that moment at the point of decision. As their interests had been entirely unrepresented, this decision would certainly have been against them, and would have forever made impossible the use of their cars on any railroad of the United States. This had been done by an apparently hostile litiga- tion by the oil combination against the Southern Pacific Rail- road. The former sued in the United States courts for an in- junction to forbid the railroad from hauling the cars of the competitor, on the ground that they were an infringement on its own patented cars. No notice was given the persons most interested — the owners of the cars in question — whose business life was involved, and they were not at first made parties to the suit. The dummy defendant — the railroad — made no valid opposition, but with great condescension admitted that all the averments of its antagonist were true. The case was sent through the courts on a gallop to get a decision. After that the merchants whose cars were the object of the attack, as they had not been parties to the case, could not have it reopened, and it would stand against them without possibil- ity of reversal. The firm found that a temporary injunction had been applied for and had been granted; that this had been followed by proceedings to make the injunction per- petual ; that subpoenas had been issued, served, and returned, and an order had been obtained from the court for taking testimony. In place of the regular examiner of the court, a special examiner had been appointed ; he had begun taking evidence the same day, and taking it privately. The testi- mony so taken had been sealed and filed. The railroad had made its answer December 2d, the testimony already taken was filed in court December 3d, making the case complete for decision by the judges. December 4:th the firm heard for the first time of what was being done, and December 5th applied for the right to take part, which saved them. To get such cases read}' for a hearing in the United States Circuit Court, where this was done, usually requires a year. But in this instance it was done in two weeks ! Only just as the door of the court was closing irrevocablj', as far as their 484 THE SMOKELESS MEBATE rights were concerned, did the firm get inside, and secxire leave to have their side represented. The vvliole fabric of the litigation fell at the first touch. Tlie temporary injunc- tion against the use of their car was dissolved, the perma- nent injunction was refused, the patent of the oil trust's car was declared worthless, and this decision was upheld by the United States Circuit Court of Appeals in February, 1893.' Meanwhile their oil, side-tracked in the Mojave Desert and elsewhere, was being cooked to death, their customers were going elsewhere, and they were being put to loss and dam- ages which they are now suing to have made good to them. '• There are some equivocal circumstances in the case," said Judge Hoffman, dissolving the injunctions in 1890. He pointed out that the railroad made no objection to the in- junction which deprived it of business. This " tends to corroborate suspicions," he said, suggested by other features of the case. The railroad persisted in remaining in the case to the end, after the real parties in interest came in, and, although codefendants with these parties, the road manoeuvred for tlie benefit of the other side in a way which the Court again said " had an equivocal appearance." The counsel for the firm, in his brief for the United States Circuit Court of Appeals, pointed out more causes for "suspicion." He showed the Court that the records of the case had been mu- tilated in many places. All the mutilations were in favor of the other side of the case. Who was the author of the mu- tilations was not shown, but it was shown that the record had been intrusted by the lower court to a representative of one of the oil trust, to be printed and delivered to the Court of Appeals. " It would be a very easy matter for a vicious at- torney," said the lawyer of the independents, " under such circumstances, to make changes and alterations in the record that might not be noticed, but would nevertheless greatly prejudice the case." When the victims of the smokeless rebate used the only prop- ' Standard Oil Company vs. Southern Pacific Railroad and Whittier, Fuller & Co., 48 Federal Reporter, p. 109. A CLOVJ) OF WITNESSES 485 crty many of them had left — their right of appeal to courts or Legislature or executive officials — thej were showered with abuse, as people with " private grievances," ' "strikersand sore- heads," "black-mailers,"" " moss-backs," ..." naturally left in the lurch" . . . "people who came forward with envy and jealousy of the success" of the oil combination," " throttlers," "ravenous wolves" "hoary old reprobate," "senile old liar," " public till-tapper," " plunderers," " pestilence." ' Such are a few of the blossoms of rhetoric with which those who sought their rights in courts or before the Legislature have been crowned. These witnesses have come forward all through the period between 1872 and 1892, and from every point of importance in the industry — New York, Pittsburg, Cleve- land, Oil City, San Francisco, Titusville, Philadelphia, Mari- etta, Buffalo, Boston, Cincinnati, Louisville, Memphis, New Orleans. They have come from every province of the indus- try — the refineries, the oil fields, the pipe lines, railroads, the wholesale and retail markets. Bound together by no com- mon tie of organization or partnership, they have, each and all, exactly the same kind of storj' to tell. The substance of their complaint — that one selected knot of men, members of one organization, were given, unlawfully, the control of the highways, to the exclusion and ruin of the people — has been sustained by the evidence taken by every official investiga- tion, and by the decision of every court to which the facts have been submitted. As the counsel of the New York Chamber of Commerce before the New York Legislative Committee of 1879 said : " Such a power makes it possible to the freight agents of tl)e railwaj's to constitute themselves special partners in every line of business in the United States, contributing as their share of capital to the business the ability to crush out rivals." Men who can choose which merchants, manufactur- ' Testimony, New York Assembly "Hepburn" Report, 1^19, p. 2753. '■Testimony, Trusts, Congress, 1888, pp. 333, 534. ^Testimony, New Yorlc Assembly "Hepburn" Report, 1S79, pp. 2656-57. * See pp. 145, 319, 320. 486 THE SMOKELESS REBATE ers, producers shall go to market and whicli stay at home, have a key that will unlock the door of every business house on the line ; they know the combination of every safe. In their appeal to the executive of Pennsylvania, the Pe- troleum Producers' Union refer to the conduct of the rail- road officials as " inexplicable upon any ordinary li3'pothesis, or under any known theory of railroad politics." ' What the railroad managers did, we know ; why they did it, has never been judicially demonstrated. One of the earliest intima- tions of the kind of lubricant used was given by the anti-mo- nopoly leader of the people in the Constitntional Convention of Pennsylvania of 1S72, who is now the legal leader of the oil combination. He said: "I am told that discriminations are now made to so great an extent as to be ruinous to cer- tain companies unless the railroad companies' officers are given a bonus. That is the evil under which we labor. I do not know how to cure it, but it must be cured somehow." Again he said: "It is charged — I do not make the charge mj'self — but it is charged upon a railroad company running through the oil regions that it will not, without delay, trans- port oil delivered to the railroad station by the various pipe lines unless it is interested in the pipe line. ... It is said that whenever a new pipe line is built, it is necessary that somebody connected with the particular railroad company shall be presented with stock in the pipe line; otherwise, it (the railroad company) will not furnish cars without tedious and unnecessary delay. This is a discrimination whicli should be stopped." "^ It is plain that the purpose of the discrimination was some- thing more than to shunt the control of the trade — more than "to maintain the business" of the favorite. Ten cents a barrel difference would have done that, for, as the Supreme Court of Ohio pointed out, that alone amounted to a tax of 21 per cent, a year on the capital of the " outsiders." ^ "When ' Trusts, Congress, 188S, p. 354. ' Debates, Constitutional Convention to amend the Consdtution of Pennsjlvania, 1872, vol. viii., pp. 261, 262. =See p. 69. VEILED PliOFITS 487 10 cents was enougli, why was the tax made 22-^ cents, 25 cents, 64^ cents up to $1.10 ? Some railroad men are known to have been stockholders in the oil combination. "I think I owned — I guess I had $100,000 in it. ... I don't know anything at all about it" — the company — the head of the New York Central admitted.' Who were the owners of certain shares of their capital stock these men have always refused to divulge. In giving in court a list of stockholders of one of their corporations one of the officers uncovered only three-quarters of the stock. Who held the other fourth he avowed he could not say, although the stock-book was in his custody." The dividends were paid to the vice-^president, and by him handed over to these veiled prophets. There was a similar mystery about the owners of about $2,000,000 of the National Transit stock, the con- cern which owns and manages the pipe lines. Asked for the names of the owners of this portion, the " secretary " said : " It is a private matter. ... I decline to answer." ' The president of this pipe-line branch also refused to give Congress this information.* This secrecy will couple itself at once in the mind of the investigator with the charges just quoted, that railroad officials had to be given backsheesh of pipe-line stock before their roads would carry the oil of the pipe lines. The United States Senate Committee which investigated the cattle and meat monopolies had a similar experience. Their report says : " The secretary of the Union Stock- yards testified at Chicago that when the company was es- tablished the stock was subscribed by the railroads; but when asked to show his stock-books he declined, after con- sultation with the company's attorneys, and persisted in this refusal at Washington City. For the purposes of our in- vestigation it was not considered necessary to ascertain in 1 Testimony, New York Assembly "Hepburn" Report, 1879, pp. 1314-15. ' Testimony, Commonwealth of Pennsylvania vs. Pennsylvania Kailroad et ah, 1879, p. 629. 'Testimony, Trusts, Congress, 1888, pp. 367-68. ■* Same, p. 396. 488 THE SMOEMLESS JiEBATE •whose names tlie stock now stands, for we were satisfied that whatever the ownership it would not appear in the names of the railroad presidents, directors, and stockholders, who are tlie real owners. . . . The refusal of the secretary, under direction of his employers, to make public the list of stockholders must have been because of the fact that the same men own the stock3-ards and the railroads running to them, and they do not propose to submit their books to scru- tiny because they dread the truth. . . . This extraordinary con- duct on the part of the stockyards company is not alone in tlie chain of evidence which shows complicity between the stockyards and the railroads."' The smokeless rebate makes the secret of success in busi- ness to be not manufacture, but manufi'acture — breaking down with a strong hand the true makers of things. To those who can get the rebate it makes no difference who does the dig- ging, building, mining, making, producing the million forms of tlie wealth they covet for themselves. They need only get control of the roads. All that they want of the wealth of others can be switched off the highways into their hands. To succeed, ambitious men must make themselves refiners of freight rates, distillers of discriminations, owners, not of lands, mines, and forests — not in the first place, at least — but of the railway officials through whose hands the produce must go to market; builders, not of manufactories, but of privileges; inventors only of schemes to keep for themselves the middle of the road and both sides of it ; contrivers, not of competi- tion, but of ways to tax the property of their competitors into their pockets. They need not make money ; they can take it from those who have made it. In the "United States the processes of business feudaliza- tion are moving more rapidly to the end than in any other country. In Chicago, the youngest of the great cities of the youngest of the great nations, there are fewer wholesale drv- goods stores in 1894 for a population of 1,600,000 than there 'Eeport of the United States Senate Committee on ileat Products, Slst Con- gress, 1st Session, 1890, No. 629, p. 18. STMFATHETIC UAILBOABINO 489 were in 1860 for 112,172. In almost everj' one of the mete- oric careers by which a few men in each trade are rising to supreme wealth, it will generally be found that to some priv- ilege on the railed highways, accomplished by the rebate, is due the part of their rise which is extraordinary'. A few cases of great wealth from the increased value of land, a few from remarkable inventions like the sewing-machine, are only exceptions. From using railroad power to give better rates to the larger man, it was an easy step to using it to make a favorite first a larger man, then the largest man, and finally the only man in the business. In meat and cattle we see men rising from poverty to great wealth. From being competitors, like other men, in the scramble, they get into the comfortable seat of conti-ol of the prices at which the farmer must sell cattle, and at Avhich tlie people must buy meai,.' Many other men had thrift, sobriety, industry, but only these had the rebate, and so only these are the "fittest in the struggle for existence." We find a merchant prince of the last generation in Is^ew York gathering into his hands a share of the dry-goods busi- ness of the country which appears entirely disproportionate to his ability and energy, great though these be. Is his secret a brain so much larger than his competitors' brains as his bnsi- ness is greater than theirs ? The freight agent of the jSTew York Central testified that he gave this man a special rate " to build up and develop their business." "They were languishing and suffering?" " To a great extent." = " This," said the counsel for the Chamber of Commerce of New York before the committee, " is deliberately making the rich richer and tlie poor poorer, by taxing the poor for the benefit of the rich through the instrumentality of the freight charge." ' ' Testimony, N"ew York Assembly "Hepburn" Report, lS/9, pp. 397, 781, S25 924 1383. United States Senate Report on Meat Products, p. 23. - TestimoDT, New York Assembly " Hepburn" Report, 1879, pp. 80S-9. ^Same, speech of Simon Sterne, p. 3996. 490 THE SMOKELESS REBATE The officials of the Pennsylvania Kailroad, by the use of rebates, handed over the State of Pennsylvania to three coal- dealers, each of whom had his territory, and was supreme in it, as wonld-be competitors found ont when they undertook to ship coal into his market. They made a similar division of the iron and steel business. The rebate is the golden-rule of the "gospel of wealth." We have already seen that the secret of the few corporations which have become the owners of almost every acre of the anthracite coal of Pennsylvania was the rebate.' Along one of the most important lines ont of Chicago grain dealers who had been buying and selling in an open market, building elevators, investing capital and life, found five j'ears ago market and railroad and livelihood suddenly closed to them, and the work of thirty years brought to an imtimely end. The United States Interstate Commerce Com- mission, and the United States District Attorneys co-operating with it, broke down in the attempt to compel the railroad men who gave these privileges of transportation, or the busi- ness men who received them, to testify or to produce their books. The United States grand-jury in Chicago, in December, 1890, proceeded against the shijjpers and the railroad men. All of them refused to tell the rates given or received, or to produce their books. Why do you refuse to answer? they were asked. Because to do so would incriminate us. Here, too, would-be successful men have gone gunning with the smokeless rebate for control of the wheat and corn and all the produce of tlie American farmer. Grain is fated to go the way that oil, hard coal, cattle, and meat have already gone. The farmer may remain the nominal owner of his farm under these circumstances, but he will be real owner of nothing but the piece of paper title. First the product of the farm ; then the farm. In America rises the shadow of a coming land-ownership more concen- ' See pp. 13, 19. A SHUTTLE THAT IS CROOKED 491 trated, more cruel, with the impersonal crueltj of corporate anonymity, than any the world has yet seen. The grain broker who becomes, by favor of the general freight agent, the sole shipper and warehouseman of grain along a line of railroad, becomes thereby the sole buyer, and in the sole buyer of the produce we have the fast-growing germ of the future sole buyer of the land. "Petroleum is the victim to-day," said the address, in 1872, of the Petroleum Producers' Union " to all newspapers and boards of trade opposing monopoly. . . . Coal, iron, cotton, breadstufEs, or live-stock may be in the grasp of the monopoly to-morrow." The prediction is more than half fulfilled. "I ran away from liome, and went to California," said a prominent grain merchant to the writer, "to escape being compelled to testify as to the freight rates I was paying. But these decisions that we cannot be forced to incriminate our- selves give me safe-conduct, and I am going home to take all the rebates I can get." This is what is going on to-day in the "division of prop- erty" in America. Our society is woven together by the steam shuttle that moves between its farms and dinner-tables, its cotton-fields and factories, thousands of miles apart, and the shuttle is crooked. Out of §800,000,000 paid yearly in this country for the carriage of freight, it was estimated in 1888, by one who knew, that $50,000,000 to 8100,000,000 goes to favored shippers.' As the result of personal examina- tion made as an expei-t for stockholders, he declared that one of the great trunk lines had in the last twenty years thus di- verted to favorites of the managers $100,000,000 of the money of the stockholders. Besides his yachts and trotters, every Captain of Industry worth talking about keeps his stud of railway presidents and general freight agents. Public opinion, as yet only in the gristle in these new questions, turns upon first one and then another as the autlior of its troubles — the soulless corporation, the combination ' Franklin B. Gowen, before the United States Senate Interstate Commerce Committee, March, 1SS8. 492 TSE SMOKELESS REBATE of corporations, railroad oppression, or what not. But the corporation is merely a cover, the combination of corpora- tions an advantage, the private ownership of public high- ways an opportunity, and the rebate its perfect tool. The real actors are men ; the real instrument, the control of their fellows by wealth, and the mainspring of the evil is the morals and economics which cipher that brothers produce wealth when they are only cheating each other out of birth- rights. The success of the same men in Europe shows that railroad discrimination is not the essence of their power, though it has in America been the chief instrument. By their wealth and their willingness to use it in their way they have become su- preme. Supreme even where, as in England and Germany, they had no such unjust and crushing preference on the high- ways as in America. Back of highway privilege, back of money power, back of trade supremacy gained hy these two means must be reckoned, as the essence of this phenomenon, the morality — our' morality — which not only allows but en- courages men to do each other to death, provided only the weapon be a bargain and the arena a market. "Everything shall not go to market," saj-s Emerson ; but everything does go to market. The millionaire is the modern hero, says the jS"ew York Evening Post. The men who have found in the rebate the secret of business success — and there are more of them than the public guesses — have only extended a fiercer hand to the results all were aiming at. They have used the smokeless rebate because it was the best gun. But if that had not been ready to their hand, they would have taken the next best. The course of conquest might have been slower, but, unless checked by moral interventions, it would have reached the same end. If society is founded on the idea that property belongs to the strongest, these will sooner or later get all the property, by bargains or by battles according to " the spirit of the age." The highest State and national courts and the Interstate Commerce Commission of the United States have sustained WMAliT AND WITHOUT REST 493 the people in the assertion of their rights, under tlie law, to come and go with free and equal rights on the highwa3's. The judges have solemnly warned the guilty men that they must give up their "abhorrent" attempt to drive citizens out of the industries of their choice, and to add the property of the people to their vast estates. Although thus declared in the right by the highest judges of the law and tlie fact, the people are poor, defeated, and unsuccessful. Though thus warned by tlie authoritative voice of the ministers of right and justice that their purposes and practices are iniquitous and intolerable, the men who have determined that whole prov- inces of American industry shall be theirs, and theirs only, continue their warfare of extermination upon poor men with methods practically unchanged. They evade or defy the laws of the States and of the nation, and the decisions of the courts, State and national. Guided by the advice of the skilfullest lawyers, they persist in open violation, or make such changes in their procedure as will nullify statute and decision without danger to them. For thirty years the independents in the oil regions have had this reinforcement of the law, and for thirty ^•ears, in spite of it, their rights have been defiantly, continu- ously violated to the common ruin. The people spend their lives passing about from field or factory, or shop or office, to market, from market to court, from court to Legislature, from Legislature to printing-office. They are the type of the time, disturbed by the demand of the new tyranny of wealth for tribute from their daily labors, and forbidden to rest until out of their suffering a new liberty has been won — the industrial liberty, for which political and religious liberty wait for their full realization. CHAPTER XXXIV THE OLD SELF-INTEEEST The corn of tlie coming hai'vest is growing so fast that, like tlie farmer standing at night in his fields, we can hear it snap and crackle. We have been fighting fire on the well-worn lines of old-fashioned politics and political economy, regulat- ing corporations, and leaving competition to regulate itself. But the flames of a new economic evolution run around ns, and we turn to find that competition has killed competition, that corporations are grown greater than the State and have bred individuals greater than themselves, and that the naked issue of our time is with property becoming master instead of servant, property in many necessaries of life becoming mo- nopoly of the necessaries of life. AVe are still, in part, as Emerson says, in the quadruped state. Our industry is a fight of every man for himself. The prize we give the fittest is monopoly of the necessaries of life, and we leave tliese winners of the powers of life and death to wield them over us by the same "self-interest" witli which they took them from us. In all this we see at work a " principle " which will go into the records as one of the historic mistakes of humanity. Institutions stand or fall by their philosophy, and the main doctrine of industry since Adam Smitli has been the fallacy that the self-interest of the individual was a suflicient guide to the welfare of the indi- vidual and society. Heralded as a final truth of "science" this proves to have been nothing higher than a temporary formula for a passing problem. It was a reflection in words of the policy of the day. When the Middle Ages landed on the shores of the six- THE GOLDEN RULE OP BUSINESS 495 teenth century they broke ranks, and for three hundred years every one has been scurrying about to get wliat he could. Society was not highly developed enough to organize the ex- ploration and subjugation of worlds of new things and ideas on any broader basis tiian private enterprise, personal advent- ure. People had to run away from each other and from the old ideas, nativities, guilds, to seize the prizes of the new sci- ences, the new land, the new liberties which make modern times. Tliey did not go because the philosophers told them to. The philosophers saw them going and wrote it down in a book, and have believed tliemselves ever since to be tlie in- ventors of the division of labor and the discoverers of a new world of social science. But now we are touching elbows again, and the dream of these picnic centuries that the social can be made secondary to the individual is being chased out of our minds by the hard light of the crisis into which we are waking. " It is a law of business for each proprietor to pursue his own interest," said the committee of Congress which in 1893 investigated the coal combinations. " Tiiere is no hope for any of us, but the weakest must go first," is the golden rule of business.' There is no other field of human associations in which any such rule of action is allowed. The man who should apply in his family or his citizenship this " survival of tlie fittest" theory as it is practically professed and op- erated in business would be a monster, and would be speed- ily made extinct, as we do with monsters. To divide the supply of food between himself and his children according to their relative powers of calculation, to follow his concep- tion of his own self-interest in any matter which the self- interest of all has taken charge of, to deal as he tliinks best for himself with foreigners with wliom his country is at war, would be a short road to the penitentiary or the gallows. In trade men have not yet risen to the level of the family life of the animals. The true law of business is that all must pursue ■•Testimony, Trusts, Congress, 18S8, p. 215. 496 THE OLD SELF-INTEREST the interest of all. In the law, the highest product of civiliza- tion, this has long been a commonplace. The safety of the peo- ple is the supreme law. We are in travail to bring industry up to this. Our century of the caprice of the individual as the law-giver of the common toil, to employ or disemploy, to start or stop, to open or close, to compete or combine, has been the disorder of the school while the master slept. The happiness, self-interest, or individuality of the whole is not more sacred than that of each, but it is greater. They are equal in quality, but in quantity they are greater. In the ultimate which the mathematician, the poet, the reformer pro- jects the two will coincide. Our world, operated by individual motive, is the country of the Chinese fable, in which the inhabitants went on one leg. Yes, but an "enlightened self-interest"? The perfect self- interest of the perfect individual is an admirable conception, but it is still individual, and the world is social. The music of the spheres is not to be played on one string. Nature does nothing individually. All forces are paired like the sexes, and every particle of matter in the universe has to obey every other particle. When the individual has progressed to a perfect self-interest, there will be over against it, acting and reacting with it, a correspondingly perfect self-interest of the communitj'. Meanwhile, we who are the creators of society have got the times out of joint, because, less experienced than the Creator of the balanced matter of earth, we have given the precedence to the powers on one side. As gods we are but half-grown. For a hundred years or so our eco- nomic theory has been one of industrial government by the self-interest of the individual. Political government by the self-interest of the individual we call anarchy. It is one of the paradoxes of public opinion that the people of America, least tolerant of this theory of anarchy in political govern- ment, lead in practising it in industry. Politically, we are civilized ; industrially, not yet. Our century, given to this laissez-faire — "leave the individual alone ; he will do what is best for himself, and what is best for him is best for all " THE ANARCHY AMERICA TOLERATES 497 has done one good : it has put society at the mercy of its own ideals, and has produced an actual anarchy in industry which is horrifying us into a change of doctrines. We have not been able to see the people for the persons in it. But there is a people, and it is as different from a mere juxtaposition of persons as a globe of glass from the handful of sand out of whicli it was melted. It is becoming, socially, known to itself, with tliat self-consciousness which distin- guishes the quick from the dead and the unborn. Every com- munity, said Pascal, is a man, and every man, said Plato, is a community. There is a new self-interest — that of the " man called million," as Mazzini named him — and with this social motive the other, -which has so long had its own way, has now to reckon. Mankind has gone astray following a truth seen only partially, but coronated as a whole truth. Many civilizations must worship good men as gods and follow the divinity of one and another before civilization sees that these are only single stars in a firmament of humanity. Our civil- ization has followed tl;e self-interest of the individual to learn that it was but one of the complex forces of self-interest. The true laissez-faire is, let the individual do what the in- dividual can do best, and let the community do what the com- munity can do best. The laissez-faire of social self-interest, if true, cannot conflict with the individual self-interest, if true, but it must outrank it always. "What we have called "free competition" has not been free, only freer than what went before. The free is still to come. The pressure we feel is no- tice to prepare for it. Civilization — the process of making men citizens in their relations to each other, by exacting of each that he give to all that wliich he receives from all — has reached only those forms of common effort wliich, because most general and most vital, first demanded its harmonizing touch. Men joining in the labors of the family, the mutual sacrifices of the club or the church in the union of forces for self-defence and for the gains of co-operation on the largest scale in labors of universal concern, like letter-carrying, have come to be so far civilized. 32 498 TSM OLD SELF-INTEREST History is condensed in the catchwords of the people. In the phrases of individual self-interest which have been the shibboleths of the main activities of onr last hundred years were prophesied: the filling up of the Mississippi by the for- est-destroying, self-seeking lumber companies of the North ; the disintegration of the American family — among the rich by too little poverty, and among the poor by too much ; the embezzlement of public highways and public franchises into private property'; tlie devolution of the American mer- chants and manufacturers into the business dependants — and social and political dependants, thei'efore — of a few men in eacli great department of trade, from dry-goods to whiskey ; the devolution of the free farmer into a tenant, and of the working-man into a fixture of the locomotive or the factory, forbidden to leave except by permission of his employer or the public; and that melde of injunctions, baj'onets, idle men and idle machinery, rich man's fear of poor man and poor man's fear of starvation, we call trade and industry. Where the self-interest of the individual is allowed to be the rule both of social and personal action, the level of all is forced down to that of the lowest. Business excuses itself for the things it does — cuts in wages, exactions in hours, tricks of competition — on the plea that the merciful are compelled to follow the cruel. "It is pleaded as an excuse by those" (common carriers) " who desire to obey the" (Interstate Com- merce) "law that self-preservation drives them to violate it because other carriers persist in doing so," says Senator Cullom. "When the self-intprest of society is made the stand- ard the lowest must rise to the average. The one pulls down, the other up. That men's hearts are bad and that bad men will do bad things has a truth in it. But whatever the gener- al average of morals, the anarchy which gives such individuals tlieir head and leaves them to set the pace for all will produce infinitely worse results than a policy which applies mutual checks and inspirations. Bad kings make bad reigns, but mon- archy is bad because it is arbitrary power, and that, whether it be political or industrial, makes even good men bad. RULE OF TEE MINORITY 499 A partial truth universally applied as this of self-interest has been is a universal en-or. Everything goes to defeat. Highways are used to prevent travel and traffic. Ownership of the means of production is sought in order to " shut down " production, and the means of plenty make famine. All fol- low self-interest to find that though they have created mar- vellous wealth it is not theirs. We pledge "our lives, our fortunes, and our sacred honor " to establish the rule of the majority, and end by finding that the minority — a minority in morals, money, and men — are our masters whichever way we turn. We agonize over "economy," but sell all our grain and pork and oil and cotton at exchanges where we pay brokerage on a hundred or a thousand barrels or bushels or bales of wind to get one real one sold. These intolerabilities — sweat-shops where model merchants buy and sell the cast-off scarlet-fever skins of the poor, factory and mine where childhood is for- bidden to become manhood and manhood is forbidden to die a natural death, mausoleums in which we bury the dead rich, slums in which we bury the living poor, coal pools with their manufacture of artificial winter — all these are the rule of private self-interest arrived at its destination. A really human life is impossible in our cities, but they can- not be reconstructed under the old self-iuterest. Chicago was rebuilt wrong after the fire. Able men pointed out the ave- nues to a wider and better municipal life, but they could not be opened through the private interpositions that blocked the way. The slaughter of railway men coupling cars was shown, in a debate in the United States Senate, to be twice as great as it would be if the men were in active service in war. Eut under the scramble for private gain our society on its railway side cannot develop the energy to introduce the improved ap- pliances ready to hand which would save these lives, all young and vigorous. The cost of the change would be repaid in 100- per-cent. dividends every 3'ear by the money value alone to us of the men now killed and wounded. But we shall Lave to wait for a nobler arithmetic to give us investments so good as that. The lean kine of self-interest devour the fat kiue. 500 THE OLD SELF-INTEREST The railroad stoctliolder, idolater of self-interest, lets himself be robbed — like the stockholder of all the railroads in this story — either because he is too rich to mind, too feeble to make himself heard, or too much implicated elsewhere as principal in the same kind of depredation to care or dare to stir -what he knows to be a universal scandal. He has become within himself the battle-ground of a troop of warring devils of selfishness; his selfishness as a stockholder clutched at the throat by his selfishness as a parasite, in some " inside deal," feeding on the stockholder ; some rebate arrangement, fast- freight line, sleeping-car company, or what not. And, as like as not, upon this one's back is another devil of depredation from some inner ring within a ring. Torn at the vitals, the enlightened swinishness of our leit-motif is hastening to throw itself into the sea. "We are very poor. The striking feature of our economic condition is our poverty, not our wealth. We make ourselves " rich " by appropriating the property of others by methods which lessen the total property of all. Spain took such riches from America and grew poor. Modern wealth more and more resembles the winnings of speculators in bread during famine — ^worse, for to make the money it makes the famine. What we call cheapness shows itself to be unnatural fortunes for a very few, monstrous luxury for them and proportionate deprivation for the people, judges debauched, trustees dishon- ored. Congress and State legislatures insulted and defied, when not seduced, multitudes of honest men ruined and driv- en to despair, the common carrier made a mere instrument for the creation of a new baronage, an example set to hun- dreds of would-be commercial Caesars to repeat this rapine in other industries and call it " business," a process set in op- eration all over the United States for the progressive extinc- tion of the independence of laboring men, and all business men except the very rich, and their reduction to a state of vassalage to lords or squires in each department of trade and industry. All these — tears, ruin, dishonor, and treason — are the unmarked additions to the " price marked on the goods." DEAR CHEAPNESS 501 Shall we buy cheap of Captain Kidd, and shut our ears to the agony that rustles in his silks? Shall we believe that Captain Kidd, who kills commerce by the act which enables him to sell at half-price, is a cheapener ? Shall we preach and practise doctrines which make the Black Flag the emblem of success on the high seas of human interchange of service, and complain when \ye see mankind's argosies of hope and plenty shrink into private hoards of treasure, buried in selfish sands to be lost forever, even to cupidity ? If this be cheapness, it comes by tiie grace of the seller, and that is the first shape of dearness, as security in society by the grace of the ruler is the first form of insecurity. The new wealth now administers estates of fabulous ex- tent from metropolitan bureaus, and all the profits flow to men who know nothing of the real business out of which they are made. Red tape, complication, the hired man, con- spiracy have taken the place of the watchful eye of the owner, the old-fashioned hand at the plough that must " hold or drive." We now have Captains of Industry, with a few aids, rearranging from oflBce-chairs this or that industry, by mere contrivances of wit compelling the fruits of the labor of tens of thousands of their fellows, who never saw them, never heard of them, to be every day deposited unwilling and unwit- ting to their own credit at the bank ; setting, as by necro- mancy, hundreds of properties, large and small, in a score of communities, to flying through invisible ways into their hands ; sitting calm through all the hubbub raised in courts, legislat- ures, and public places, and by dictating letters and whisper- ing words remaining the master magicians of the scene ; defy- ing, though private citizens, all the forces and authorities of a whole people ; by the mere mastery of compelling brain, without putting hand to anything, opening or closing the earth's treasures of oil or coal or gas or copper or what not ; pulling down or putting up great buildings, factories, towns themselves ; moving men and their money this way and tliat ; inserting their will as part of the law of life of the people — American, European, and Asiatic — and, against the protest of 502 THE OLD SELF-INTEMEST a whole civilization, making themselves, their methods and principles, its emblematic figures. Syndicates, by one stroke, get the power of selling dear on one side, and producing cheap on the other. Thus they keep themselves happy, prices high, and the people hungry. "What model merchant could ask more? The dream of the king who wished that all his people had but one neck that he might decapitate them at one blow is realized to-day in this industrial garrote. The syndicate has but to turn its screw, and every neck begins to break. Prices paid to such inter- cepters are not an exchange of service ; they ai-e ransom paid by the people for their lives. The ability of the citizen to pay may fluctuate ; what he must pay remains fixed, or ad- vances like the rent of the Irish tenant to the absentee land- lord until the community interfered. Those who have this power to draw the money from the people — from every rail- road station, every street-car, every fireplace, every salt-cel- lar, every bread-pan, wash-board, and coal-scuttle — to their own safes have the further incentive to make this money worth the most possible. By contracting the issue of cur- rencj' and contracting it again by hoarding it in their banks, safe-deposii vaults, and the government treasury, they can depress the prices of all that belongs to the people. Tiieir own prices are fixed. These are "regular prices," estab- lished by price-lists. Given, as a ruling motive, the princi- ples of business — to get the most and give the least ; given the legal and economic, physical and mechanical control, possible under our present social arrangements, to the few over the many, and the" certain end of all this, if unarrested, unre- versed, can be nothing less than a return to chattel slavery. Tiiere may be some finer name, but the fact will not be finer. Between our present tolerance and our completed subjection the distance is not so far as that from the equality and sim- plicity of our Pilgrim Fathers to ourselves. Everything withers — even charity. Aristocratic benevo- lence spends a shrunken stream in comparison with demo- cratic benevolence. In an address to the public, soliciting FACTS OF TEF GOLDEN EULF 503 subscriptions, the Committee of the United Hospitals Associ- ation of New Toric said, in December, 1893 : " Tlie committee have found that, tlirough the obliteration of old methods of individual competition by the establishment of large corpora- tions and trusts in modern times, the income of such charita- ble institutions as are supported by the individual gifts of the benevolent has been seriously affected." Franklin pricked the bubble of the lottery by showing that to buy all the tickets and win all the prizes was to be most surely the loser. Our nascent common -sense begins to see that the many must always lose where all spend their lives trying to get more than they give, and that all lose when any lose. The welfare of all is more than the welfare of the many, the few, or the one. If the few or the one are not fine enough to accept this truth from sentiment or conscience, they can find other reasons as convincing, though not as amiable. From the old regime of France, the slave-holders of the South, the death-rate of tyrants, the fear of their brothers which the rich and the great of to-day are print- ing on their faces, in fugitive -slave treaties with Eussia, and in the frowning arsenals and armories building in our cities for "l aw and o rder," they can learn how to spell self- interest. If all will sacrifice themselves, none need be sacrificed. But if one may sacrifice another, all are sacrificed. That is the difference iDctween self-interest and other -self interest. In industry we have been substituting all the mean passions that can set man against man in place of the irresistible power of brotherhood. To tell us of the progressive sway of brotherhood in all human affairs is the sole message of his- tory. " Love thy neighbor as thyself " is not the phrase of a ritual of sentiment for the unapplied emotion of pious hours; it is the exact formula of the force to-day operating the oreatest institutions man has established. It is as secular as sacred. Only by each neighbor giving the other every right of free thought, free movement, free representation which he demands for himself; only by calling every neighbor a friend, 504 THE OLD SELF-INTEREST and literally laying down his life for bis friend against foreign invasion or domestic tumult; only by tbe equalization •wbicb gives the vote to all and denies kingship to all, however strong or " fittest" — onlj' thus is man establishing the commu- nity, the republic, which, with all its failings, is the highest because the realest application of the spirit of human brother- hood. Wonderful are the dividends of this investment. You are but one, and can give only yourself to America. You give free speech, and 65,000,000 of your countrymen will guard the freedom of your lips. Your single offer of your right arm puts 65,000,000 of sheltering arms about you. Does "business" pay such profits? Wealth will remain a secret unguessed by business until it has reincorporated itself under the law which reckons as the property of each one the total of all the possessions of all his neighbors. Society could not live a day, the Bishop of Peterborongh said, if it put the principles of Christ into practice. There is no rarer gift than that of eyes to see what we see. Society is society, and lives its day solely by virtue of having put into actual routine and matter-of-fact application the principles of Christ and other bringers of the same message. Imperfect and faulty though the execution, it is these principles which are the family, the tribe, the sect, the club, the mutual-bene- fit society, the State, with their mutual services, forbearance, and guarantees. The principles of Christ are the cause and essence of society. They are not the ideal of which we dream ; they are the applied means with which we are working out our real life in " the light of common day." They have not been so much revealed to us by our inspired ones as best seen and best said by them. Insurance for fire, accident, sickness, old age, death — the ills that flesh is heir to — has the same co- operation for its innermost forces. Limited now by the in- tervention of the selfishness of profit-seeking, it needs only to be freed from this, and added, as in New Zealand, to the growing list of the mutualities of the general welfare oper- ated by the State to be seen as what it ia The golden rule is the original of every political constitution, written and un- THE WEALTH OF VIRTUE 505 written, and all our reforms are but the pains with which we strive to improve the copy. In the worst governments and societies that have existed one good can be seen — so good that the horrors of them fall back into secondary places as extrinsic, accidental. That good is the ability of men to lead the life together. The more perfect monopoly makes itself the more does it bring into strong lights tlie greatest fact of our industry, of far more permanent value than the greed which has for the mo- ment made itself the cynosure of all eyes. It makes this fair world more fair to consider the loyalties, intelligences, do- cilities of the multitudes who are guarding, developing, op- erating with the faithfulness of brothers and the keen inter- est of owners properties and industries in which brotherhood is not known and their title is not more than a tenancy at will. One of the largest stones in the arch of "consolida- tion," perhaps the key-stone, is that men have become so in- telligent, so responsive and responsible, so co-operative that they can be intrusted in great masses with the care of vast properties owned entirelj' by others and with the operation of complicated processes, although but a slender cost of sub- sistence is awarded them out of fabulous profits. The spec- tacle of the million and more employes of the railroads of this country despatching trains, maintaining tracks, collecting fares and freights, and turning over hundreds of millions of net profits to the owners, not one in a thousand of whom would know how to do the simplest of these things for him- self, is possible only where civilization has reached a high averao-e of morals and culture. More and more the mills and mines and stores, and even the farms and forests, are being administered by others than the owners. The virtue of the people is taking the place Poor Eichard thought only the eye of the owner could fill. If mankind, driven by their fears and the greed of others, can do so well, what will be their productivity and cheer when the "interest of all " sings them to their work ? This new morality and new spring of M^ealth have been 506 THE OLD SELF-INTEREST seized first by the appropriating ones among ns. But, as has been in government, their intervention of greed is but a pass- ing phase. Mankind belongs to itself, not to kings or mo- nopolists, and will supersede the one as surely as the other with the institutions of democracy. Yes, Callicles, said Socrates, the greatest are usually the bad, for tliey have the power. If power could continue paternal and benign, mankind would not be rising through one emancipation after another into a progressive communion of equalities. The individual and society will always be wrestling with each other in a compo- sitioa of forces. But to just the extent to which civilization prevails, society will be held as inviolable as the individual ; not subordinate — indeed inaudible — as now in the counting- room and corporation-office. We have overworked the self- interest of the individual. The line of conflict between indi- vidual and social is a progressive one of the discover}' of point after point in which the two are identical. Society thus passes from conflict to harmony, and on to another conflict. Civilization is the unceasing accretion of these social solu- tions. We fight out to an equilibrium, as in the abolition of human slavery; then upon tliis new level thus built up we enter upon the struggle for a new equilibrium, as now in the labor movement. The man for himself destroys himself and all men ; only society can foster him and them. The greatest happiness of the greatest number is only the doctrine of self-interest writ large and made more dangerous by multitude. It is the self-interest of the majority, and this has written some of the unloveliest chapters of history. There have never been slaves more miserable than those of Sparta, where the State was the owner. American democracy pre- pares to repeat these distresses of the selfishness of the many, and gives notice to its i-ailway employes of a new divine right — "the convenience of the public" — to which they must fore- go every right of manhood. No better definition of slave could be found than one who must work at the convenience of another. This is the position into which recent legal de- cisions and acts of the Federal executive force railway men. LATEST ANJi CBUELEST FANATIC 507 These speak in the name of Interstate Commerce, but their logic can be as easily applied by State judges to State com- merce, and all working-men are manifestly as necessary, each in liis function, to the convenience of the public as the men of the rail. The greatest happiness of all must be the for- mula. When Lamennais said, "I love my family more than myself, my village more than my family, my country more than my village, and mankind more than my country," he showed himself not only a good lover, but the only good arithmetician. Children yet, we run everything we do — love or war, work or leisure, religion or liberty — to excess. Every possibility of body and mind must be played upon till it is torn to pieces, as toys by children. Priests, voluptuaries, tyrants, knights, ascetics — in the long procession of fanatics a new-conier takes his place; he is called "the model merchant" — the cruelest fanatic in history. He is tlie product of ages given to pro- gressive devotion to " trading." He is the high-priest of the latest idolatry, the self-worship of self-interest. Whirling- dervish of the market, self, friends, and family', hoAj and sonl, loves, hopes, and faith, all are sacrificed to seeing how many " turns" he can make before he drops dead. Trade be- gan, Sir Henry Sumner Maine tells ns, not within the family or community, but without. Its first appearances are on the neutral borderland between hostile tribes. There, in times of peace, they meet to trade, and think it no sin that " the buyer must beware," since the buyer is an enemy. Trade has spread thence, carrying with itself into family and State the poison of enmity. From the fatherhood of the old patriarchal life, where father and brother sold each other nothing, the world has chaffered along to the anarchy of a " free " trade which sells everything. One thing after another has passed out from under the regime of brotherhood and passed in under that of bargainhood. The ground we move on, the bodies we work with, and the necessaries we live by are all being " exchanged," by " rules fetched with cupidity from heartless schools," into the ownership of the Jacobs of mankind. By 508 THE OLD SELF-INTEREiiT these rules the cunning are the good, and the weak and the tender the bad, and the good are to have all the goods and the weak are to have nothing. These rules give one the power to supply or deny work to thousands, and to use the starvation terms of the men he disemploys as the measure of the cost of subsistence of all workmen. This must be near the end. The very churches have become mercantilized, and are markets in which "prophets" are paid fancy prices — "al- ways called of God," as Milton said, " but always to a greater benefice " — and worshippers buy and sell knee-room. Conceptions of duty take on a correspondingly unnatural complexion. The main exhortations the world gives beginners are how to "get on " — the getting on so ardently inculcated being to get, like the old-man-of-the-sea, on somebody's back. " If war fails you in the country where you are, you must go where there is war," said one of the successful men of the fourteenth century to a young knight who asked him for the Laws of Life. " I shall be perfectly satisfied with you," I heard one of the great business geniuses of America say to his son, " if you will only always go to bed at night worth more than when you got up in the morning." The system grows, as all systems do, more complicated, and gets further away from its first purposes of barter of real things and services. It goes more under the hands of men of apt selfishness, who push it further away from general comprehension and the general good. Tariffs, currencies, finances, freight-rate sheets, the laws, become instruments of privilege, and just in propor- tion become puzzles no people can decipher. " I have a rio-ht to buy my labor where I can buy it cheapest" — beginning as a protest against the selfish exclusions of antiquated trade- guilds outgrown by the new times — has at last come to mean, " I have a right to do anything to cheapen the labor I want to buy, even to destroying the family life of the people." When steaming kettles grew into beasts of burden and pub- lic highways dwindled into private property administered by private motives for private ends, all previous tendencies were intensified into a sudden whirl redistributing wealth and OUn TOVCHSTONES 509 labors. It appears to have been the destiny of the railroad to begin and of oil to lubricate to its finish the last stage of this crazy commercialism. Business colors the modern world as war reddened the ancient world. Out of such delirium mon- sters are bred, and their excesses destroy the system that brought them forth. There is a strong suggestion of moral insanity in the unrelieved sameness of mood and unvarying repetition of one act in the life of the model merchant. Sane minds by an irresistible law alternate one tension with an- other. Only a lunatic is always smiling or always weeping or always clamoring for dividends. Eras show their last Stages by producing men -who sum up individually the morbid characteristics of the mass. When the crisis comes in which the gathering tendencies of generations shoot forward in the avalanche, there is born some group of men perfect for their function — good be it or bad. They need to take time for no second thought, and will not delay the unhalting reparations of nature by so much as the time given to one tear over the battle-field or the bargain. With their birth their mission is given them, whether it be the mission of Lucifer or Gabriel. This mission becomes their conscience. The righteous indig- nation that other men feel against sin these men feel against that which withstands them. Sincere as rattlesnakes, they are selfish with the unconsciousness possible to only the en- tirely commonplace, without the curiosity to question their times or the imagination to conceive the pain they inflict, and their every ideal is satisfied by the conventionalities of church, parlor, and counting-room. These men are the touchstones to wither the cant of an age. We preach " Do as you would be done by " in our churches, and "A fair exchange no robbery" in our counting-rooms, and "All citizens are equal as citizens" in courts and Congress. Just as we are in danger of believing that to say these things is to do them and be them, there come unto us these men, practical as granite and gravitation. Taking their cue not from our lips, but from our lives, they better the instruction, and, passing easily to the high seats at every table, prove that 510 THE OLD SELF-INTEREST we are liars and hypocrites. Their only secret is that they do, better than we, the things we are all trying to do, but of which in our morning and evening prayers, seen of all men, we are continually making believe to pray : Good Lord, deliver us ! When the liour strikes for such leaders, tliey come and pass as by a law of nature to the front. All follow them. It is their fate and ours that they must work out to the end the des- tiny interwoven of their own insatiate ambition and the false ideals of us who have created them and their opportunity. If our civilization is destroyed, as Macaulay predicted, it will not be by his barbarians from below. Our barbarians come from above. Our great monej'-makers have sprung in one generation into seats of power kings do not know. The forces and the wealth are new, and liave been the opportunity of new men. Without restraints of culture, experience, the pride, or even the inherited caution of class or rank, these men, intoxicated, think they are the wave instead of the float, and that they have created the business which has created them. To them science is but a never-ending repertoire of invest- ments stored np by nature for the syndicates, government but a fountain of franchises, the nations but customers in squads, and a million the unit of a new arithmetic of wealth written for them. They claim a power without control, ex- ercised through forms which make it secret, anonymous, and perpetual. The possibilities of its gratification have been widening before them without interruption since they began, and even at a thousand millions they will feel no satiation and will see no place to stop. They are gluttons of luxury and power, rough, unsocialized, believing that mankind must be kept terrorized. Powers of pity die out of them, because they work through agents and die in their agents, because what they do is not for themselves. Of gods, friends, learnings, of the nncomprehended civil- ization they overrun, they ask but one question : How much ? Wiiat is a good time to sell ? What is a good time to buy ? The Church and the Capitol, incarnating the sacrifices and triumphs of a procession of martyrs and patriots since the OVR BARBARIANS FROM ABOVE 511 dawn of freedom, are good enough for a money-changer's shop for them, and a market and shambles. Their heathen eyes see in the law and its consecrated oflScers nothing but an intelligence-olBce and hired men to help them burglarize the treasures accumulated for thousands of years at the altars of liberty and justice, that they may burn their marbles for the lime of commerce. By their windfall of new power they have been forced into the position of public enemies. Its new forms make them seem not to be within the jurisdiction of the social restraints which many ages of suffering have taught us to bind about the old powers of man over man. A fury of rule or ruin has always in the history of human affaire been a characteris- tic of the "strong men" whose fate it is to be in at the death of an expiring principle. The leaders who, two hundred years ago, would have been crazy with conquest, to-day are crazy with competition. To a dying era some man is always born to enfranchise it by revealing it to itself. Men repay such bene- factors by turning to rend them. Most unhappy is the fate of him whose destiny it is to lead mankind too far in its own path. Such is the function of these men, sucli will be their lot, as that of those for whom they are building up these wizard wealths. Poor thinking means poor doing. In casting about for the cause of our industrial evils, public opinion has successively found it in "competition," "combination," the "corpora- tions," "conspiracies," "trusts." But competition has ended in combination, and our new wealth takes as it chooses the form of corporation or trust, or corporation again, and with every change grows greater and worse. Under these kaleidoscopic masks we begin at last to see progressing to its terminus a steady consolidation, the end of which is one-man power. The conspiracy ends in one, and one cannot conspire with, himself. When this solidification of many into one has been reached, we shall be at last face to face with the naked truth that it is not only the form but the fact of arbitrary power, of control without consent, of rule without representation that concerns us. 512 THE OLD SELF-JNTERUST Business motived by the self-interest of the individual runs into monopoly at every point it touches the social life — land monopoly, transportation monopoly, trade monopoly, political monopoly in all its forms, from contraction of the currency to corruption in oflBce. The society in which in half a lifetime a man without a penny can become a hundred times a mill- ionaire is as over -ripe, industrially, as was, politically, the Rome in which the most popular bully could lift himself from the ranks of the legion on to the throne of the Caesars. Our rising issue is with business. Monopoly is business at the end of its journey. It has got there. The irrepressible conflict is now as distinctly with business as the issue so lately met was with slavery. Slavery went first only because it was the ci'uder form of business. Against the principles, and the men embodying them and pushing them to extremes — by which the powers of govern- ment, given by all for all, are used as franchises for personal aggrandizement; by which, in the same line, the common toil of all and the common gifts of nature, lands, forces, mines, sites, are turned from service to selfishness, and are made by one and the same stroke to give gluts to a few and impoverishment to the many — we must plan our campaign. The yacht of the millionaire incorporates a million days' labor which might have been given to abolishing the slums, and every day it runs the labor of hundreds of men is withdrawn from the production of helpful things for humanity, and each of us is equally guilty who directs to his own pleasure the labor he should turn to the wants of others. Our fanatic of wealth reverses the rule that serving mankind is the end and wealth an incident, and has made wealth the end and the service an accident, until he can finally justify crime itself if it is a means to the end — wealth— which has come to be the supreme good ; and we follow him. It is an adjudicated fact of the business and social life of America that to receive the profits of crime and cherish the agents who commit it does not disqualify for fellowship in the most " solid " circles — financial, commercial, religious, or THAT IS rjlOPERTY 513 social. It illustrates what Ruskin calls the "morbid" char- acter of modern business that the history of its most brilliant episodes mnst be studied in the vestibules of the penitentiary. The riches of the combinations are the wiimings of a policy which, we have seen, lias certain constant features. Property to the extent of uncounted millions has been changed from the possession of the many who owned it to the few who hold it : 1. Without the knowledge of the real owners. 2. Without their consent. 3. With no compensation to them for the value taken. 4. By falsehood, often under oath. 5. In violation of the law. Our civilization is builded on competition, and competi- tion evolves itself crime — to so acute an infatuation has the lunacy of self-interest carried our dominant opinion. We are hurried far beyond the point of not listening to the new con- science which, pioneering in moral exploration, declares that conduct we think right because called " trade " is really lying, stealing, murder. " The definite result," Kuskin preaches, "of all our modern haste to be rich is assuredly and constantly the murder of a certain number of persons by our hands every year." To be unawakened by this new voice is bad enough, but we shut our ears even against the old conscience. AVe cannot deal with this unless we cleanse onr hearts of all disordering rage. " The rarer action is in virtue rather than in vengeance." Our tyrants are our ideals incarnating them- selves in men born to command. AVhat these men are we have made them. All governments are representative gov- ernments ; none of them more so than our government of industry. We go hopelessly astray if we seek the solution of our problems in the belief that our business rulers are worse men in kind tlian ourselves. Worse in degree ; yes. It is a race to the bad, and the winners are the worst. A system in which the prizes go to meanness invariably marches with the meanest men at the head. But if any could be meaner than the meanest it would be they who run and fail and rail. 33 514 THE OLD SELF-INTEEEST Every idea finds its especially susceptible souls. These men are our most susceptible souls to the idea of individual self-interest. They have believed implicitly what we have taught, and have been the most faithful in tr^'ing to make the talent given them grow into ten talents. They rise superior to our half-hearted social corrections : publicity, private com- ' petition, all devices of market-opposition, private litigation, public investigation, legislation, and criminal prosecution — all. Their power is greater to-day than it was yesterday, and will be greater to-morrow. The public does not withhold its favor, but deals with them, protects them, refuses to treat their crimes as it treats those of the poor, and admits them to the highest places. Tlie predominant mood is the more or less concealed regret of the citizens that they have not been able to conceive and execute the same luck}' stroke or some other as profitable. The conclusion is irresistible that men 60 given the lead are the representatives of the real "spirit of the age," and that the protestants against them are not rej^resentative of our times — are at the best but intimators of times which may be. Two social energies have been in conflict, and the energj- of reform has so far proved the weaker. We have chartered the self-interest of the individual as the rightful sovereign of conduct ; we have taught that the scramble for profit is the best method of administering the riches of earth and the ex- change of services. Only those can attack this system who attack its central principle, that strength gives the stroncr in the market the right to destroj' his neighbor. Only as we have denied that right to the strong elsewhere have we made ourselves as civilized as we are. And we cannot make a change as long as our songs, customs, catchwords, and public opinions tell all to do the same thing if they can. Society, in each person of its multitudes, must recognize tliat the same principles of the interest of all being the rule of all, of the strong serving the Aveak, of tlie first being the last — "I am among you as one that serves" — which have given us the home where the weakest is the one surest of his rights and of AFTERNOON IN THE MARKET 515 the fullest service of the strongest, and have given ns the re- public in which all join their labor that the poorest may be fed, the weatest. defended, and all educated and prospered, must be applied where men associate in common toil as wherever they associate. Not until then can the forces be reversed which generate those obnoxious persons — our fittest. Our system, so fair in its theory and so fertile in its happi- ness and prosperity in its first century, is now, following the fate of systems, becoming artificial, technical, corrupt ; and, as always happens in human institutions, after noon, power is stealing from the many to the few. Believing wealth to be good, the people believed the wealtliy to be good. But, again in history, power has intoxicated and hardened its possessors, and Pharaohs are bred in counting-rooms as they were in pal- aces. , Their furniture must be banished to the world-garret, where lie the out-worn trappings of the guilds and slavery and other old lumber of human institutions. CHAPTER XXXV AND THE NEW We have given the .prize of power to the strong, the cun- ning, the arithmetical, and we must expect nothing else but that they will use it cunningly and arithmeticall}'. For what else can they suppose we gave it to them ? If the power really flows from the people, and should be used for them ; if its best administration can be got, as in government, only by the participation in it of men of all views and interests ; if in the collision of all these, as in democracy, the better policy is progressively preponderant; if this is a policy which, with whatever defects, is better than that which can be evolved by narrower or more selfish or less multitudinous influences of persons or classes, then this power should be taken up by the people. '•' The mere conflict of private interests will never produce a well-ordered commonwealth of labor," saj's the au- thor of the article on political economy' in the EncyclopcEdia Britannica. The failure of monarchy and feudalism and the visibly impending failure of onr business system all reveal a law of nature. The harmony of things insists that that which is the source of power, wealth, and delight shall also be the ruler of it. That which is must also seem. It is the people from whom come the forces with which kings and million- aires ride the world, and until the people take their proper place in the seat of sovereignty, these pseudo owners — mere claimants and usurpers — will, by the very falsity and iniquity of their position, be pushed into deceit, tyranny, and cruelty, ending in downfall. Thousands of years' experience has proved that govern- ment must begin where it ends — with the people; that the FROM REPUBLIC TO COMMONWEALTH 617 general welfare demands that they who exercise the powers and they upon whom these are exercised must be the same, and that higher political ideals can be realized only through higher political forms. Myriads of experiments to get the substance of liberty out of the forms of tyranny, to believe in princes, to trust good men to do good as kings, have taught the inexorable truth that, in the economy of nature, form and substance must move together, and are as inextricably inter- dependent as arc, within our experience, what we call matter and spirit. Identical is the lesson we are learning with regard to industrial power and property. We are calling upon their owners, as mankind called upon kings in their day, to be good and kind, wise and sweet, and we are calling in vain. "We are asking them not to be what we have made them to be. "We put power into their hands and ask them not to use it as power. If this power is a trust for the people, the people betrayed it when they made private estates out of it for indi- viduals. If the spirit of power is to change, institutions must change as much. Liberty recast the old forms of government into the Kepublic, and it must remould our institutions of wealth into the CommonAvealth. The question is not whether monopoly is to continue. The sun sets every night on a greater majority against it. We are face to face with the practical issue : Is it to go througli ruin or reform ? Can we forestall ruin by reform ? If we wait to be forced by events we shall be astounded to find how much more radical they are than our Utopias. Louis XV"I. waited until 1793, and gave his head and all bis investitures to the people who in 1789 asked only to sit at his feet and speak their mind. Unless we reform of our own free will, nature will reform us by force, as nature does. Onr evil courses have already gone too far in prodacing misery, plagues, hatreds, national enervation. Already the leader is unable to lead, and has begun to drive with judges armed with bayonets and Gatling guns. History is the serial obituary of the men who thought they could drive men. Reform is the science and conscience with which mankind 518 A2fD THE IfHW in its manhood overcomes temptations and escapes conse- quences by killing the germs. Kuin is already hard at work among ns. Our libraries are full of the official inquiries and scientific interpretations which show how our master-motive is working decay irj all our parts. The family crumbles into a competition between the father and the children whom he breeds to take his place in the factor^', to unfit themselves to be fathers in their turn. A thorough, stalwart resiniplification, a life governed by simple needs and loves, is the imperative want of the world. It will be accomplished : either self-con- scious volition does it, or the slow wreck and decay of super- fluous and unwholesome men and matters. The latter is the method of brutes and brute civilizations. The other is the method of man, so far as he is divine. Has not man, who has in personal reform risen above the brnte method, come to the height at which he can achieve social reform in masses and by nations? We must learn; we can learn by reason. Why wait for the crueler teacher? We have a people like which none has ever existed before. We have millions capable of conscious co-operation. The time must come in social evolution when the people can or- ganize the free-will to choose salvation which the individual has been cultivating for 1900 years, and can adopt a policy more dignified and more effective than leaving themselves to be kicked along the path of reform by the recoil of their own vices. We must bring the size of our morality up to the size of our cities, corporations, and combinations, or these will be brought down to fit our half-grown virtue. Industr3' and monopoly cannot live together. Our mod- ern perfection of exchange and division of labor cannot last without equal perfection of morals and sympathy. Every one is living at the mercj' of every one else in a waj' entirely peculiar to our times. Nothing is any longer made bj' a man ; parts of things are made by parts of men, and become wholes by the luck of a good-humor which so far keeps men from fly- ing asunder. It takes a whole company to make a match. A hundred men will easily produce a hundred million matches, LIBERTY AND MONOPOLY 519 but not one of them could make one match. No farm gets its plough from the cross-roads blacksmith, and no one in the chilled-steel factory knows the whole of the plough. The life of Boston hangs on a procession of reciprocities which must move, as steadily and sweetly as the roll of the planets, between its bakeries, the Falls of St. Anthony, and the valley of the Ked River. Never was there a social machinery so delicate. Only on terms of love and justice can men endure contact so close. The break -down of all other civilizations has been a slow decay. It took the ISTortherners hundreds of years to march to the Tiber. They grew their way through the old society as the tree planting itself on a grave is found to have sent its roots along every fibre and muscle of the dead. Our world is not the simple thing theirs was, of little groups sufficient to themselves, if need be. New York would begin to die to- morrow if it were not for Illinois and Dakota. We cannot afford a revulsion in the hearts by whose union locomotives run, mills grind, factories make. Practical men are specu- lating to-day on the possibility that our civilization may some afternoon be flashed away by the tick of a telegraph. AU these co-operations can be scattered by a word of hate too many, and we left, with no one who knows how to make a plougb or a match, a civilization cut off as by the Roman curse from food and fire. Less sensitive civilizations than ours have burst apart. Liberty and monopoly cannot live together. What chance have we against the persistent coming and the easy coalescence of the confederated cliques^ wliiclx,asj)ire to say of all business, " This belongs to us," and whose members, though moving among us as brothers, are using against us, through the cor- porate forms we have given them, powers of invisibility, of entail and accumulation, unprecedented because impersonal and immortal, and, most peculiar of all, power to act as per- sons, as in the commission of crimes, with exemption from punishment as persons? Two classes study and practise poli- tics and government : place hunters and privilege hunters. In 520 AND TEE NEW a world of relativities like ours size of area has a great deal to do with the truth of principles. America has grown so big — and the tickets to be voted, and the powers of government, and the duties of citizens, and the profits of personal use of public functions have all grown so big — that the average citi- zen has broken down. No man can half understand or half operate the fulness of this big citizenship, except by giving his whole time to it. This the place hunter can do, and the privilege hunter. Government, therefore — municipal. State, national — is passing into the hands of these two classes, spe- cialized for the functions of power by their appetite for the fruits of power. The power of citizenship is relinquished by those who do not and cannot know how to exercise it to those who can and do — by those who have a livelihood to make to those who make politics their livelihood. These specialists of the ward club, the primary, the cam- paign, the election, and office unite, by a law as irresistible as that of the sexes, with those who want all the goods of gov- ernment — charters, contracts, rulings, permits. From this marriage it is easy to imagine that among some other people than ourselves, and in some other century than this, the off- spring might be the most formidable, elusive, unrestrained, impersonal, and cruel tyranny the world has yet seen. There might come a time when the policeman and the railroad pres- ident would equally show that they cared nothing for the citizen, individually or collectively, because aware that they and not he were the government. Certainly such an attempt to corner " the dear people " and the earth and the fulness thereof will break down. It is for us to decide whether we will let it go on till it breaks down of itself, dragging down to die, as a savage dies of his vice, the civilization it has gripped with its hundred hands ; or whether, while we are still young, still virtuous, we will break it down, self-consciously, as tlie civilized man, reforming, crushes down the evil. If we cannot find a remedy, all that we love in the word Amer- ica must die. It will be an awful price to pay if this at- tempt at government of tlie people, by the people, for the BY REFORM OR BY FORCE 521 people must perish from off the face of the earth to pi-ove to mankind tliat political brotlierhood cannot survive where industrial brotherhood is denied. But the demonstration is worth even that. Aristotle's lost books of the Kepublics told the story of two hundred and fifty attempts at free government, and these were but some of the many that had to be melted down iu the crucible of fate to teach Hamilton and Jefferson what they knew. Perhaps we must be melted by the same fierce flames to be a light to the feet of those who come after us. For as true as that a house divided against itself cannot stand, and that a nation half slave and half free cannot permanently en- dure, is it true that a people who are slaves to market-tyrants will surely come to be their slaves in all else, that all liberty begins to be lost when one liberty is lost, that a people half democratic and half plutocratic cannot permanently endure. The secret of the history we are about to make is not that the world is poorer or worse. It is richer and better. Its new wealth is too great for the old forms. The success and beauties of our old mutualities have made us ready for new mutualities. The wonder of to-day is the modern multiplica- tion of products by the union of forces ; the marvel of to- morrow will be the greater product which will follow wlien that which is co - operatively produced is co-operatively en- joyed. It is the spectacle of its concentration in the private fortunes of our day which reveals this wealth to its real makers — the whole people — and summons them to extend the manners and institutions of civilization to this new tribal relation. Whether the great change comes with peace or sword, freelj- throuo'h reform or by nature's involuntary forces, is a mere matter of detail, a question of convenience — not of the es- sence of the thing. The change will come. With reform, it may come to ns. If with force, perhaps not to us. But it will come. The world is too full of amateurs who can play the golden rule as an aria with variations. All the runs and trills and. transpositions have been done to death. All the 522 AND TEE NEW " sayings " have been said. The only field for new effects is in epigrams of pi'actice. Titillation of our sympathies has become a dissipation. "We shed a daily tear over the misery of the slums as the toper takes his dram, and our liver becomes tor- pid with the floods of indignation and sentiment we have guz- zled without converting them into their co-efBcients of action. "Regenerate the individual" is a half-truth; the reoi-gani- zation of the society which he makes and which makes him is the other half. Man alone cannot be a Christian. Insti- tutions are applied beliefs. The love of liberty became lib- erty in America by clothing itself in the complicated group of structures known as the government of the United States. Love is a half-truth, and kissing is a good deal less than half of that. We need not kiss all our fellow-men, but we must do for them all we ask them to do for us — nothing less than the fullest performance of every power. To love our neigh- bor is to submit to the discipline and arrangement which make his life reach its best, and so do we best love ourselves. History has taught us nothing if not that men can con- tinue to associate only by the laws of association. The golden rule is the first and last of these, but the first and last of the golden rule is that it can be operated only through laws, habits, forms, and institutions. Tlie Constitution and laws of the United States are, however imperfectly, the translation into the language of politics of doing as j'ou would be done by — the essence of equal rights and government by consent. To ask individuals to-day to lead by their single sacrifices the life of the brother in the world of business is as if the Amer- ican colonist had been asked to lead hj his individual enter- prise the life of the citizen of a republic. That was made possible to him onlj' by union with others. The business world is full of men who yearn to abandon its methods and live the love they feel ; but to attempt to do so by themselves would be martyrdom, and that is "caviare to the general." " We admire martyrdom," Mazzini, the martyr, said, " but we do not recommend it." The change must be social, and its martyrdoms have already begun. miOE OF UNION 523 The new self-interest will remain unenforced in business until we invent the forms by which the vast multitudes who liave been gathered together in modern production can or- ganize tliemselves into a people there as in government. ISTothing but this institutionalization will save them from be- ing scattered away from each other again, and it can be achieved only by such averaging and concessions and co-oper- ations as are the price of all union. These will be gains, not losses. Soldiers become partners in invincibility by the disci- pline which adopts an average rate of march instead of com- jjelling all to keep step with the fastest and stay with the strongest. Moralists tell men to love each other and the right. How, by doing what things, by leaving what undone, shall men love each other? What have the ethicals to say upon the morality of putting public highways in private hands, and of allowing these private hands to make a private and privileged use of them 1 If bad, will a mere " change of heart," uninstitutionalized, change them? New freedoms cannot be operated through the old forms of slavery. The ideals of "Washington and Hamilton and Adams could not breathe under kingly rule. Idle to say they might. Under the mutual dependence of the inside and out- side of things their change has all throagh history always been dual. Change of heart is no more redemption than hunger is dinner. "We must have honesty, love, justice in the heart of the business world, but for these we must also have the forms which will fit them. These will be very dif- ferent from those through which the intercourse of man with man in the exchange of services now moves to such ungra- cious ends. Forms of Asiatic and American government, of early institutions and to-day's, are not more different. The cardinal virtues cannot be established and kept at work in trade and on the highways with the old apparatus. In order that the spirit that gave rebates may go to stay, the rebate itself must go. If the private use of private ownership of highways is to go, the private ownership must go. There must be ho private use of public power or public property. 524 AND THE NEW Tliese are created by the common sacrifices of all, and can be rightfully' used only for the common good of all — from all, by all, for all. All the grants and franchises that have been given to private hands for private profit are void in morals and void in that higher law which sets the copy for the laggard pens of legislatures and judges. "iN'o private xise of public powers" is but a threshold truth. The universe, says Emerson, is the property of every creature in it. Iso home so low it may not hope that out of its fledglings one may grow the hooked claw that will make him a million- aire. To any adventurer of spirit and prowess in the Italy of the Keuaissance might come the possibility of butchering or poisoning his way to a castle or a throne. Such prizes of power made the peninsula a menagerie of tyi'ants, murderers, voluptuaries, and multitudes of misery. We got republican liberty by agreeing each with the other never to seek to be- come kings or lords or dukes. "We can get industrial and economic liberty only by a like covenant never to let our- selves or any one else be millionaires. There can be no public prosperity without public virtue, and no public virtue without private virtue. But private can- not become public except by organization. Our attempts at control, regulation, are but the agitations of the Gracchi, evi- dencing the wrong, but not rising to the cure. We are wait- ing for some genius of good who will generalize into one body of docti'ine our partial truths of reform, and will help us live the genei-alization. Never was mankind, across all lines of race, creed, and institutions, more nearly one in discontent and restless consciousness of new powers and a new hope and purpose, never more widely agitated by influences leading in one direction, never more nearly a committee of the whole on the question of the day. l^ever before were the means for flashing one thought into the minds of the million, and flash- ing that thought into action, what they are to-day. The good word or good deed of Chicago in the morning may be the in- spiration of Calcutta before nightfall. The crusades were but an eddy in comparison with the universal tide waiting for an- SLAVE-TRADE, SLAVERY, POVERTY 525 other Peter the Hermit to lead us where the Man who is to rise again lies in the hands of the infidel. Our problem can be read from its good side or its bad, and must be read from both, as: Business has become a vice, and defeats us and itself ; or, Humanity quickens its steji to add to its fellovvsliips the new brotherhood of labor. The next emancipation, like all emancipations, must destroy and build. The most constructive thinker in history said, Love one an- other; but he also drove the money-changers from the temple, and denounced the scribes and Pharisees, and has been busy for nineteen hundred years pulling down tenements unfit for the habitation of the soul. We see something new and some- thing old. Old principles run into mania, a wicked old world bursting into suicidal explosion, as Carlyle said of the French Revolution. JSTew loves, new capabilities, new institutions, created by the expansion of old ideals and new opportunities of human contact. Our love of those to whom we have been "introduced" is but unlocking a door through which all men will pass into onr hearts. What makes men lovable is not the accident of our knowing them. It is tliat they are men. Be- fore 1776 there were thirteen patriotisms in America. The bishops of Bos well's day had no ear for the lamenta- tions of the victims of the slave-trade, but there came a new sympathy which rose superior to their divine disj^leasure that this commerce of Christian merchants should be attacked. We ai-e coming to sympathize with the animals, and Queen Victoria contributes money to a hospital for the succor of de- cayed old gentlemen and lady cats. By-and-by royal hearts may widen to include men and women evicted in Ireland, or — worse fate — not evicted from Whitechapel. The spirit tliat defended the slave-trade now finds its last ditch behind the text, The poor ye have with you always. But a new sympathy rises again, like that which declared that the poor should be free of the slave-trade and slaverj^, and declares that the poor shall be freed from starvation of body, mind, and soul. Slave- trade, slavery, poverty ; the form varies, but against them all runs the refusal of the human heart to be made happ}' at 526 AND TSE NEW the cost of the misery of others, and its mathematical knowl- edge that its quotient of satisfactions will increase with the sum of the happiness of all. The word of the day is that we are about to civilize indus- try. Mankind is quivering with its purpose to make men fellow-citizens, brothers, lovers in industry, as it has done with them in government and family, which are also industr3\ We already have on our shelves the sciences — hygienic, industrial, political, ethical — to free the world almost at a stroke from war, accidents, disease, poverty, and their flowing vices and insanities. The men of these sciences are here at call pray- ing for employment. The people, by the books they read, show themselves to be praying to have them put at work. If we who call ourselves civilization would for one average span devote to life-dealing the moneys, armies, and genius we now give to death-dealing, and would establish over the weaker peoples a protectorate of the United States of Europe and America, we would take a long step towards settling forever the vexed question of the site of the Garden of Eden. " Human nature," "monotony," and "individuality " are the lions which the reformer is alwaj'S told will stop the way to a better world. " You cannot change human nature." There are two human natures — the human nature of Christ and of Judas; and Christ prevails. There is the human nature which seeks anonymity, secrecy, the fruits of power without its duties ; and there is the human nature which rises against these and, province b)' province, is abolishing them from luimau affairs. Men have always been willing to die for their faith. Tlie bad have died as bravely as the good, Charles I. with as smooth a front as Sir Harry Vane. In this readiness to die lies folded every loyalty of life. " You would make the world a dead level of monotony." Good society does not think it monotonous that all its women should at the same time dust the streets with long-tailed gowns, or that its men should meet every night in funereal black and identical cut, but it shrinks from the monotony of having all share in reforms which would equalize surfeit and OOOD SOCIETY AND MONOTONY 527 starvation. "Good society" is still to come, and it will find some better definition of "monotony" than a fair sli are for all — a better definition of variety than too mnch for ourselves at the cost of too little for all others. Shall we choose the monotony of sharing with every one under George III. or Alex- ander II. the denial of all right to participate in the supreme power, or shall we choose the monotony of sharing with every fellow-citizen the right to become President ? — the monotony of being forbidden to enter all the great livelihoods, some syndicate blocking each way with " This business belongs to ns" ? Or the monotony of a democracy, where every laborer has equal rights with all other citizens to decide upon the ad- ministration of the common toil for the common welfare, and an equal right with every other to rise to be a Captain of In- dustry ? Sirch are the alternatives of "monotony." We have made an historic choice iu one; now for the other. And "individuality." "You are going to destroy individ- uality." We can become individual only by submitting to be bound to others. We extend our freedom only by finding new laws to obey. Life outside the law is slavery on as many sides as there are disregarded laws. The locomotive ofE its tracks is not free. The more relations, ties, duties, the more "individual." The isolated man is the mere rudiment of an individual. But he who has become citizen, neighbor, friend, brother, son, husband, father, fellow -member, in one, is just by so many times individualized. Men's expanding powers of co-operation bring them to the conscious ability to unite for new benefits ; but this extension of individuality is forbidden in the name of individuality. There are two individualities : that of the dullard, who submits to take his railroad trans- portation, his light, his coal, his salt, his reaping-machine at such prices and of such quality as arbitrary power forces upon him, and that of the shrewder man who, by an alliance of the individualities of all, supplies himself at his own price. Time carries us so easily we do not realize how fast we move. This social debate has gone far beyond the question whether change there must be. What shall the change be ? is 528 A2fD THE NEW the subject all the world is discussing. Exposure of abuses no longer excites more than a languid interest. But every clear plan how things might be rearranged raises the people. Before every revolution marches a book — the Contrat Social, Uncle TorrCs Cabin. " Every man nowadays," says Emerson, "carries a revolution in his vest-pocket." The book which sells more copies than any other of our day abroad and at home, debated by all down to the boot-blacks as they sit on the curb- stones, is one calling men to draw from their success in insur- ing each other some of the necessaries of life the courage to move on to insure each other all the necessaries of life, bid- ding them abandon the self-defeating anarchy which puts rail- road-wreckers at the head of railroads and famine-producers at the head of production, and inspiring them to share the common toil and tlie fruits of the toil under the ideals which make men Washingtons and Lincoln s. You may question the importance of the plan ; you cannot question the importance of its welcome. It shows the people gath- ering-points for the new constitution they kno%v they must make. In nothing has liberty justified itself more thoroughly than in the resolute determination spreading among the American people to add industrial to political independence. It is the hope of the woi'ld that good has its effects as well as evil, and that on the whole, and in the long-run, the seed of the good will overgrow the evil. "Heaven has kindl}' given our blood a moral flow." Liberty breeds liberties, slavery breeds sla- veries, but the liberties will be the strongest stock. If the political and religious liberties which the people of this coun- try aspired to set up had in them the real sap and fibre of a better life than the world had j'et known, it must certainly follow that they would quicken and strengthen the people for discovery and obedience in still higher realms. And just this has happened. Nowhere else has the new claim to tax with- out representation been so qiiickly detected, so intelligently scrutinized, and so bravely fought. Nowhere else has this spreading plague of selfishness and false doctrine found a peo- FREE ANYWHERE MUST SE FREE EVERYWHERE 529 pie whose average and general life was pitched on so high a level that they instantly took the alarm at its claims over their lives and liberties. It has found a people so disciplined by the aspiration and achievement of political and religions rights that they are already possessed of a body of doctrine capable, by an easy extension, of refuting all the pretensions of the new absolutism. At the very beginning of this new democratic life among the nations it was understood that to be safe liberty must be complete on its industrial as well as on its political and religious sides. This is the American prin- ciple. " Give a man power over my subsistence," said Alex- ander Hamilton, "and he has power over the whole of my moral being." To submit to such a power gives only the alternative of death or degradation, and the high spirit of America preferred then, as it prefers now, the rule of right, which gives life. The mania of business has reached an acuter and extremer development in America than elsewhere, because nowhere else have bounteous nature and free institutions produced birthrights and pottages so well worth " swapping." But the follies and wickedness of business have nowhere been so sharply challenged as in free America. "Betake 3'ourself to America," said Carlyle to a friend beginning a literary career ; " there you can utter your freest thoughts in ways impossible here." It is to this stern wakefulness of a free people that the world owes it that more liglit has been thrown in America than in any other country on the processes of modern money- making. A free press, organ of a free people, has done in- valuable service. Tlie legislatures have pushed investigation after investigation into the ways in which large masses of the people have been deprived, for the benefit of single men or groups of men, of rights of subsistence and government. Through the courts the free people have pursued their depre- dators by civil and criminal process, by public and private prosecutions. Imperfect and corrupt, these agencies of press, courts, legislatures have often been; they have still done a work whicli has either been left undone altogether in other 34 530 AXD THE NEW countries, or has been done with bnt a fraction of our thor- oughness. It is due to them that there exists in the reports of legisla- tive investigations, State and national, in the proceedings of lawsuits and criminal trials, in the files of the newspajiers, a mass of information which cannot be found in any other com- mnnity in the world. There is in these archives an accumula- tion of the raw material of tragedy, comedy, romance, ravel- lings of the vicissitudes of human life, and social and personal fate, which will feed the fires of whole generations of literary men when once they awake to the existence of these precious rolls. In these pigeon-holes are to be found keys of the pres- ent and clews to the future. As America has the newest and widest liberty, it is the stage where play the newest and widest forces of evil as well as good. America is at the front of the forward line of evolution. It has taken the lead in developing competition to the extreme form in which it de- stroys competition, and in superfining the processes of ex- change of services into those of the acquisition of the prop- erty of others without service. The hope is that the old economic system we inherited has ripened so much more rapidly than the society and govern- ment we have created that the dead matter it deposits can be thrown off by our vigorous j^outh and health. " It is high time our bad wealth came to an end," says Emerson. It has grown into its monstrous forms so fast that the dullest gjq can separate it from the Commonwealth, and the slowest mind comprehend its mischievousness. In making themselves free of ai'bitrary and corrupt power in government the Americans prepared themselves to be free in all else, and because fore- most in political liberty thej' have the promise of being the first to realize industrial liberty — the trunk of a tree of which political liberty is the seed, and without which political liberty shrinks back into nothingness. "The art of Italy will blossom over our graves," Mazzini said when, with true insight, he saw that the first artistic, first literaiy task before the Italians was to make their country FROM CALIGULA TO LINCOLN 531 free. Art, literature, culture, religion, in Ammca, are already beginning to feel tlie restrictive pressure which results from the domination of a selfish, self-indulgent, luxurious, and anti- social power. This power, mastering the markets of a civilization which gives its main energies to markets, passes without difficulty to the mastery of all the other ac- tivities. When churches, political campaigns, the expound- ing of the law, maintenance of schools and colleges, and family life itself all depend on money, they must become servile to the money power. Song, picture, sermon, decrees of court, and the union of hearts must pass constantly under stronger control of those who give their lives to trade and en- courage everybody else to trade, confident that the issue of it all will be that they will hold as property, in exclusive possession, to be doled out on their own terms, the matter by which alone man can live, either materially or spiritually. In America, where the supreme political power and much of the government of church and college have been taken out of traditional hands and subjected to the changing determina- tions of popular will, it has inevitably resulted that the State, church, and school have passed under this mercantile aristoc- racy to a far greater extent than in other countries where stiffer regimes under other and older influences still stand. Our upper classes — elected, as alwaj's, by the equipoise of effort and opinion between them and the lower classes — are, under this commercial system, the men who trade best, who can control their features and their consciences so that they can always get more than they give, who can play with sup- ply and demand so that at the end of the game all their breth- ren are their tributaries for life. It is the birthright-buying minds that, by the adoption of this ideal, we choose for our rulers. The progressive races have altered their ideals of kings with the indescribable advantage of being ruled by Washingtons and Lincolns and Gladstones instead of Caligu- las and Pharaohs. We have now to make a similar step for- ward in another part of life. The previous changes expressed outwardly an inner change of heart. The reformer of to-day 532 AND THE NEW is simply lie vf\\o, with quicker ear, detecting that another change of heart is going on, goes before. Another great change is working in the inner mind of man, and will surely be followed by incorporation in institutions and morals and manners. The social head and heart are both being persuaded that too many are idle — rich and poor; too many are hurt in body and soul — rich and poor; too many children are " exposed," as in the old Greek and Roman market-places; too many are starving within reach of too much fertile waste ; too many passions of envy, greed, and hate are raging among rich and poor. There is too much left undone that ought to be done along the wliole scale of life, from the lowest physical to the liighest spiritual needs, from better roads to sweeter music and nobler worship. It cannot be long, historically speaking, before all this new sense and sentiment will issue in acts. All will be as zealously pro- tected against the oppression of the cruel in their daily labor as now against oppression from invader or rioter, and will be as warmly cheered in liberty to grow to their fullest capabili- ties as laborers — i.e., users of matter for the purpose of the spirit — as they are now welcomed to the liberty of the citizen and the worshipper. Infinite is the fountain of our rights. We can have all the rights we will create. All the rights we will give we can have. The American peoi^le will save the liberties they have inhei'ited by winning new ones to be- queath. With this will come fruits of new faculty almost beyond calculation. A new liberty will put an end to pauperism and millionairism and the crimes and death-rate born of both wretchednesses, just as the liberty of politics and religion put an end to martyrs and tyrants. The new liberty is identical in principle and purpose with the other ; it is made inevitable by them. Those who love the liberties already won must open the door to the new, imless they wish to see them all take flight together. There can be no single liberty. Liber- ties go in clusters like the Pleiades. We must either regulate, or own, or destroy, perishing by THE SAVING FERMENT 533 the sword we take. The possibility of regulation is a dream. As long as this control of the necessaries of life- and this wealth remain private with individuals, it is they who will regulate, not we. The policy of regulation, disguise it as we may, is but moving to a compromise and equilibrium within the evil all complain of. It is to accept the principle of the sovereignty of the self-interest of the individual and apply constitutional checks to it. The unprogressive nations palter in this method with monarchy. But the wits of America are equal to seeing that as with kingship and slavery so with poverty — the weeding must be done at the roots. Sir Henry Sumner Maine says mankind moves from status to contract ; from society ruled by inherited customs to one ruled by agree- ment, varied according to circumstances. Present experience suggests the addition that the movement, like all in nature, is pendulous, and that mankind moves progressively from status to contract, and from this stage of contract to another status. We march and rest and march again. If our society is set- tling down to an interval of inertia, perhaps ages long, we must before night comes establish all in as much equality and comfort as possible. The asj)irations are not new. We have had them since Plato. The knowledge of means for realizing them is not new. We have had it since Aristotle, and the history of civ- ilization is but the record of the progressive embodiment of the ideals in institutions for the life together — sexual, social, spiritual. What is new in our moment is that mankind's ac- cumulating forces are preparing for another step forvvai'd in this long processional realization of its best possible. Noth- ing so narrow as the mere governmentalizing of the means and processes of production. It is only the morally nerveless who ask government to do that which they will not rise to do. The conversion which is now working itself out within us, and perhaps is more nearly born than we suspect ("We shall not live to see slavery abolished," said Emerson, in 1859) is making itself felt on all sides of our life. In man- ners, in literature, in marriage, in church, in all, we see at 534 AM) THE NEW work the saving ferment which is to make all tilings new by bringing them nearer to the old ideals. George Sand was revolted by the servile accent of the phrase of her day, "Madame est servie." Society has grown to the better fellowship her finer ear found wanting in these words, and is now told it is dinner, not madame or monsieur, that is served. We are to have, of course, great political changes. We are to apply the co-operative methods of the post-ofHce and the public school to many other common toils, to all toils in which private sovereignty has become through monopoly a despot- ism over the public, and to all in which the association of the people and the organization of processes have been so far de- veloped that the profit -hunting Captain of Industry may be replaced by the public-serving Captain of Industry. But we are to have much more. We are to have a private life of a new beauty, of which these are to be merel}' tlie mechanical ex- hibitions on the side of politics. We are to move among each other, able, by the methodical and agreed adherence of all, to do what the words of Lamennais mean, instead of being able, as now, in most things, to afford only an indulgence in feeling them. We are to be commoners, travellers to Altruria. We are to become fathers, mothers, for the spirit of the father and mother is not in us while we can say of any child it is not ours, and leave it in the grime. We are to become men, women, for to all about reinforcing us we shall insure full growth and thus insure it to ourselves. We are to be- come gentlemen, ladies, for we will not accept from another any service we are not willing to return in kind. We are to become honest, giving when we get, and getting with the knowledge and consent of all. We are to become rich, for we shall share in the wealth now latent in idle men and idle land, and in the fertility of work done by those who have ceased to withstand but stand with each other. As we walk our parks we already see that by saying " thine " to every neio'hbor we say " mine " of palaces, gardens, art, science, far beyond any possible to selfishness, even the selfishness of kings. We shall Alf INTERNATIONAL PEOPLE 535 become patriots, for the heart will know why it tlirills to the flag. Those folds wave the sahite of a greater love than tliat of the man who will lay down liis life for his friend. There floats the banner of the love of millions, who, though they do not know you and have never seen you, will die for you and are living for you, doing in a thousand services unto you as you would be done by. And the little patriotism, which is the love of the humanity fenced within our frontier will widen into the reciprocal service of all men. Generals were, merchants are, brothers will be, humanity's representative men. There is to be a people in industry, as in government. The same rising genius of democracy which discovered that man- kind did not co-operate in the State to provide a few with palaces and king's-evil, is disclosing that men do not co-oper- ate in trade for any other purpose than to mobilize the labor of all for the benefit of all, and that the only true guidance comes from those who are led, and the only valid titles from those who create. Very wide must be the emancipation of this new self-interest. If we free America we shall still be not free, for the financial, commercial, possessory powers of modern industrial life are organized internationally. If we rose to the full execution of the first, simplest, and most pressing need of our times and put an end to all private use of public powers, we should still be confronted by monopo- lies existing simply as private property, as in coal-mines, oil lands. It is not a verbal accident that science is the substance of the word conscience. We must know the right before we can do the right. When it comes to know the facts the human heart can no more endure monopoly than American slavery or Koman empire. The first step to a remedy is that the people care. If they know, they will care. To help them to know and care; to stimulate new hatred of evil, new love of the good, new sympathy for the victims of power, and, by enlarging its science, to quicken the old into a new conscience, this compilation of fact has been made. Democracy is not a 536 AND THE NEW lie. There live in the body of the commonalty the unex- hausted virtue and the ever - refreshened strength which can rise eqnal to any problems of progress. In the hope of tap- ping some reserve of their powers of self-help this story is told to the people. APPENDIX PARTIAL LIST OF TRADE COMBINATIOXS, OR TRUSTS, ACHIEVED OR ATTEMPTED, AND OF THE COMMODITIES COVERED BY THEM ' I. LIGHT, HEAT, AND POWER Boilers, for house heating. Candle -makers, Great Britain, United States. Coal : anthracite, bituminous. Coke. Electric: carbon points, 1885; candles, 1888; electric goods, national, 1887; lighting. United States, Great Britain, 1882; light-fixtures, national, 1889. Gas: illuminating and fuel, local, sec- tional, national; fixtures, national; pipes, 1875 ; natural. Gasoline stoves, 1894. Governors of steam-boilers. Hot-water beaters, 1892. House furnaces, 1889. Kerosene, 1874. Kindling wood, Boston, 1891. Matches : United States ; Great Britain ; Canada; Sweden; international, 1894. Paraffine. Petroleum and its products, 1874. Radiators, st«am and hot-water. West- ern, 1891. Scotch mineral oil, 1888. Steam and hot-water master fitters, na- tional, 1889. Stearine. Stove-boards, zinc, national, 1890. Stoves and ranges, 1872. Stoves, vapor, national, 18S4. II. CHEMICALS Acids : acetic, citric, muriatic, nitric, sulphuric, American, 1889; oxalic, Great Britain, 1882. Alkali Union, England, 1888. Alkaloids, United States. Alum, sectional, 1889. Ammonia, 1889. Bismuth salts, United States. Bleaching-powder, England, 1888. Boracic acid, United States. Borax: United States; Great Britain, 1888. Chemical Union, England, 1890. Chloroform, United States. Drug manufacturers; United States; Canada, 1884. Iodine, England, 1890. Iodoform, United States, 1880. Lime, acetate of, 1891. Mercurials : as calomel, corrosive sub- limate, etc.. United States. Nitrates, Chili, 1884. Paris-green, 1889. Potash ; bichromate of. Great Britain ; bichloride of. United States ; chlorate, prussiate. Great Britain, 1888. Quinine, international, 1893. Rochelle salts. United States. Saltpetre. Santonine, United States. Soda, bichromate, United States ; car- ' See page 4. 538 APPENDIX bonate, caustic, England, 1S88; ni- trate of, CliiVi and England, 1884. Strjclmine. Sulphur, Italy. Ultramarine: United States; Germany, 1890. Vitriol, 1889. III. — METALS Aluminum, national, 1888. Barbed wire, 1881. Brass : sectional, 1884 ; rolled and sheet, sheet German silver, copper rivets and burrs, copper and German- silver wire, kerosene-oil burners and lamp trimmings, and braised brass tubing. Copper: cold, bolt, rolled, sheet, 1888; ore, Lake Superior, 1879; interna- tional, 1887; bath-tubs, boilers, sinks, and general ware, 1891; wire. Iron : founders ; galvanized, national, 1S75; malleable, national, 1882; manufacturers, Germany, 1887; nuts, 1884; ore, Germany, 1884, Atlantic coast, 1886, Michigan, 1882, South- ern, 1884, Northwestern, 1887, Lake Superior, 1893 ; pig. Eastern, South- ern, 1883, national, 1889; pipes, steam and gas, 1884 ; wrought iron, 1887; sheet, enamelled, Germany, 1893; structural, national, 1881; tubes, 1884 ; wire - cloth, national, 1882; Russian, 1893. Lead: pig, pipe; sheet-lead, 1888; white, national, 1884. Mica, national, 1887. Nickel. Quicksilver, California. Silver and lead smelters. Steel: armor-plate, Bessemer beams (in existence nearly thirty years), cast- ings, 1894; galvanized; rails (see traffic and travel) ; rods. United States and Germany, 1888 ; rolling- mills. Tin: jobbers; American, national, 1883; English, 18S9. Zinc. IV. SOME OTHER INSTROMENTS AND MATERIALS OF INDUSTRV Alcohol. Axes and axe-poles. Belting, leather, rubber. Blankets (press), American Paper-mak- ers' Felt and Jacket Association. Bobbins, spools, and shuttles, 188C, for cotton, woollen, silk, and linen mills. Bolts, 1884. Boxes, wooden, local, 1885; Western and Southern. Bridge-builders: Eastern, 1886; Iowa, Nebraska, Kansas, Missouri, 1889. Butchers' skewers and supplies. West- ern, 1889. Carpet yarns. Eastern, 1889. Cash-registers, national, 1890. Celluloid, lythoid, zylonite. Eastern, 1890. Chains, national, 1883. Color trust. Great Britain, 1889. Cordage : rope, twine. United States, 1875 ; England, 1892. Corks. Cotton duck, national, 1891. Cotton-seed oil, national, 1884. Creels, for cloth and woollen mills, na- tional, 1893. Damasks, Pennsylvania, 1886. Emery wheels, national. Felting. Fibre, indurated, pails, bowls, measures, water - coolers, filters, etc., national, 1888. Files, 1875. Fire-brick, 1875. Fish-oil, menhaden. New England, 1885. Forge companies, national, 1889. Glass bottles: beer. United States, 1884 ; green glass, English bottle manufact- urers, 1889. Glass: flint, Western, 1891; crown.cylia- der, unpolished; plate, French, 1888 ; German, 1887; international, 1890; window, 1875; sectional, national, in- ternational, 1884. ATPENDIX 639 Glass, plate, Underwriters, 1894. Glue. Gutta-perclia. Hardware manufacturers, 1884. Label printers. Leather: belting, national; board, na- tional, 1891 ; hides, Northwestern, 188S; morocco, Eastern, 1886; patent, national, 1888; sole, 1893; Tanners' Association, 1882; Oak Harness Leather Tanners, national, 1890. Linen mills. Eastern, Western, 1892. Linseed oil: local, 1877; national, 1887; dealers, Canada, 1892. Manilla, international, 1887. Oil: lubricating, 1874 ; for curing leath- er ; menhaden ; safety burning oil for miners. Onyx, Mexican, 1890. Paper : local, sectional, national ; bags, Eastern and Western, 1 887 ; book and newspaper ; boxes, national, 1883; card-board, 1890; flour sacks, 18S7; straw; tissue, 1892; wrap- ping. Western, 1878, Eastern, 1881; writing, national, 1884. Paper- makers' trust in Great Britain to check the operation of the Alkali trust, 1889; Papermakers' Felt and Jacket Association, national ; rags, Eastern, 1883 ; wood-pulp. Western, 1890 ; Xew York, Canada, Eastern, 1891. Pitch, national, 1887 or earlier. Planes, carpenters'. Pumps, national, 1871. Rubber: belting, 1875; electric web goring (for shoes), national. 1893 ; gossamers, 1887; hose, 1875; import- ers, national, 1882 ; manufacturers, national, 1 882 ; Brazil producers, 1 890; stamps and stencils, national, 1893. Sandpaper, emery and emery cloth, flint, garnet, ruby, sand cloth,n;itional, 1887. Saws, national, 1890. Scales. Screws : machine, 1887 ; wood, national, international. Seed Crushers' Union, England, 1889. Sewer pipe, 1875. Sewing-machines, 1885. Sewing-machine supplies. New York and New England, 1883. Spirits. Straw braid. Straw-board, 1887. Tacks, 1875. Talc mills. New York, 1893. Tar, national, 1886. Teasel, national, 1892. Textile manufacturers, Pennsylvania, 1886 — embracing dress goods, ging- hams, upholstery goods, woollens, yarns, chintzes, worsteds, damasks. Tools, edge, American Axe and Edged Tool Company, national, 1890. Turpentine, Southern, 1892. Type founders, national, 1888. Washers, 1884. Watch-cases, 1886. Well tools, for oil, gas, and artesian wells, 1889. Wood, excelsior, shavings for packing, national, 1889. Wooden-ware, 1883 or earlier. Wood-working machines, 1891. Wool felt. Wrenches, 1875. T. TRAFFIC AND TRAVEL Tlie Koad, Horse, and Wagon Bicycles, United States, 1893. Board of Trade formed to regulate prices. Bicycle tires. Bridge-builders, 1886. Buggy pails, fibre ti-ust, national, I8S8. Carriage builders, national, 18S4. Carriage hardware, 18S4. Harness dealers, manufacturers, na- tional, 1886. Liverymen's Associations, local, 1SS4. Paving: asphalt, 1836; brick, Western, 1892 ; pitch, national, 1887. Koad-making machines, Western, 1S90. Saddlery Association, national, 1891. Saddle-trees, Indiana, Missouri, 1S92. Wagons, local, 18.86. 540 APPENDIX Wheels, Western, 1S89. Whips, national, 1892. Shipping Ballast, Havana, 1882. Canal-boata, 1884. Cotton duck, sail-cloth, national, 1888. Ferries, New York and Brooklyn. Lake carriers, Hull pool, 1886. Lake Dock Trust. Marine insurance, 188S. Naval stores. Ocean steamers : European, Asiatic, and American; Garman steamship com- panies, 1894. Pilotage, New York, San Francisco. Steamboats : in the Cincinnati and New Orleans trade, 1884 ; forwarding lines along the Hudson River, 1891. Railroads Car-axles, 1890. Car-springs, steel, national, 1887. Cars, freight and cattle. Elevators, grain, local, Western, 1887. Express companies. Locomotives: national, 1892; boiler flues, 1875; tires, national, 1892. Railroad: pools, freight and passenger, sectional, national ; Eastern Railroad Association, of 800 railroads, to fight patents. Steel sleepers, 1885 ; steel rails, na- tional. Street railways, local, sectional. TI. — BUILDING Asbestos, forpaiuts, roofing, steam-pipe and boiler coverings, 1891. Beams and channels, iron and steel, na- tional, 1875. Blinds : Northwestern, 1885 ; national, 1888. Brass, gas, plumbing, steam, water goods, 1884. Brick: local, sectional, 1884; Chicago, New York, New Jersey, Washington (State) ; pressed brick, 1890. Cement : Mississippi valley, 1883 ; East- ern, 1884; Northwestern, 1884. Cornice-makers, national, 1884. Doors: Northwestern, 1885; national, 1888. Fire engines, including hook and ladder trucks, hose-carriages, heaters, carts, stationary pumps, and other supplies, United States and Canada, 1892. Fire insurance. Glue, national, 1894. Gypsum stucco, Eastern, Northwestern, 1884. Hinges, 1875. Lime, Western, 1883. Lumber: California pine, 1883; Cali- fornia redwood, 1883; Chicago; Mississippi valley ; Northwestern, 1880; Pacific coast, 18S3; poplar, 1889; Pnget Sound, 1883; yellow pine. Southern, 1890, Eastern, 1891 ; dealers, national, 1878. Nails: Pennsylvania, 1875; Western Association, 1882; Atlantic States Association, 1883. Paint. Plaster, national, 1891. Roofing: felt; iron; pitch, Vermont, national, 1887. Sanitary potterj'. Sash, doors, and blinds, national. Sewer pipes, national, 1884. Stone : brown stone, Lake Superiot, 1890, New York, 1884; cut-stone quarry owners. Western, 1892; free- stone; granite, national, 1891 ; lime- stone, rubble, and flag, Illinois, 1884 ; marble. Western dealers, 1SS5, Ver- mont marble quarries, 1SS9; sand- stone, New York, 1883. Structural steel. Stucco, 1883. Varnish dealers, national, 1888. Wall-paper: national, 1879; iuterna- tional, 18S2. VII. FARM AND PLAKTATION Agricultural implements, manufacturers, dealers, 1S91. APPENDIX 541 Binders, Harvester Trust, 1883. Churns, 1884. Corn-harvesters, national, 1892. Cotton bagging, 1888. Cotton presses, local, 1892. Drain tile, Indiana, 1894. Fencing, barbed wire, national, 1881. Fertilizers: 1888; guano; menhaden oil, New England, 1885 ; phosphate. South Carolina, 1887; Canada, 1890; Flor- ida, 1891. Forks, national, 1890. Harrow manufacturers, national, 1890. Harvesting-machines, national, 1883. Hay-presses, national, 1889. Hay tools. Western and Northwestern, 1884. Hoes, national, 1890. Horse-brushes, prison-made, 1889. Jute grain bags, national, 1888. Mowers, national, 1883. Pails, fibre trust, national, 1888- Paris green. Ploughs, Northwestern, 1884. Rakes, national, 1890. Reapers, 1883. Scythe-makers, national, 1884. Shovels, national, 1890. Snath manufacturers, national, 1891. Threshing-machines, national, 1890, 1891. Twine, binding, 1S87. Vehicles. nil. — SCHOOL, IIBRAET, AND COCXTING- ROOII Blank-books, 1888. Envelopes, 1888. Lead-pencils, 1878. Lithographic printers, national, 1892. Novels (paper-covered "libraries "),1890. School-books, national, 1884. School-furniture, national, 1892. Slates and slate-pencils, national, 1887. Subscription - books, local, sectional, 1892. Type-founders, national, 1888. Type-writers. AVriting-paper, national, 1884. II. " THE SnOT HEARD ROUND THE WORLD " Ammunition, 1883. Arms, 1883. Cartridges, national, 1883. Dynamite, Germany. Fireworks, national, 1890. Gunpowder, national, 1875. Guns, 1883. Shot-tower companies, national, 1873. X. — FOR THE PERSON Barbers, National Tonsorial Parlor Cor:i- pany, organized to establish barber- shops in all the large cities of the United States, 1890. Buttons. Calico, England, 1891. Clothes-brushes, prison-made, 1889. Coat and cloak manufacturers: New York, 1883 ; Chicago, 1893. Collars and cuffs. New York, 1890. Cotton: England, 1890; Fall River; Southern mills, 1881 ; thread (spool- cotton), 1888. Diamonds : mines in South Africa ; deal- ers in Europe, 1889. Dress-goods, Pennsylvania, 1886. Furs. Ginghams, Pennsylvania, 1886. Gloves, New York. Hats: fur, 1885; woollen, national. Knit goods: New York, 1884; Western, 1889. Jewellers, national. Laundries: Chicago; Chinese Laundry Union, New York City, 1889; St. Louis, 1893. Pocket-knives, national, 1892. Ribbons, national, 1892. Rubber boots and shoes, national, 1882. Seal-skin, national, 1892. Shirts: Troy, New York City, 1890. Shoe: manufacturers, national, 1887; retailers. New England, 1885, na- tional, 1886. Silk : manufacturers, international. France , England, Italy, Germany, 542 APPENDIX 1888; sewing, national, 1887; rib- bon, 1884. Trunks, national, 1892. Umbrellas, Eastern, 1891. Watch : manufacturers, makers and jew- ellers, national, 1886 ; National As- sociation of Jobbers of American Watches and Cases, 1886. Woollens: manufacturers, 1882; wor- steds, yarns, Pennsylvania, 1886. XI. S.MOKISO AND DRINKING Beer, United States Brewers' Associa- tion, 1861. Champagne, New York City, 1889; Trance, 1891. Meerschaum pipes, New Jersey, 1892. Soda fountains, 1890. Spittoons, fibre trust, national, 1888. Tobacco and cigars, local, sectional, na- tional, 1882 ; cigarettes, 1890. Waters, mineral, national, 1889. Whiskey and "domestic" — or arti- ficial — brandy, rum, gin, and cor- dials made in imitation of the gen- uine. Wine-growers, California, 1889. XII. — "dome, sweet home" Li General Candles, coal, furnaces, gas, oil, match- es, ranges, stoves, etc. (.see Light, Heat, and Power). Carpets : Eastern, 1885 ; Brussels, iu- grain, 1SS8. Chairs: cane, 1889; manufacturers. Western, 1880; seats, perforated, na- tional, 1888. Furniture: national, 18S3; Chicago manufacturers, 1886; retailers. New England, 1S88 ; national, 1893. Hair-cloth, Rhode Island, 1893. Oil-cloth, table and stair, Oil-cloth As- sociation, 1887. Pails, fibre trust, national, 1888. Soap, national, 1890. Upholsterers' felt. Upholstery goods, textile manufactur- ers, Pennsylvania, 1886. Window-shades, 1888. TJie Kitchen Boilers. Bottles. Brooms, 1886. Brushes, scrubbing, prison-made, 1889. Chopping-bowls, wooden-ware, national, 1884. Crockery, national, 1883. Fruit-jars, 1891. Glass-ware, 1883. Hollow-ware, prison-made, 1888. Keelers, fibre trust, national, 1888. Kettles, prison-made, 1888. Lamp-chimneys, 1883. Measures, fibre trust, national, 1888. Pans and pots, prison-made, 1888. Potato-mashers, wooden-ware, national, 1884. Pottery, yellow-ware, national, 1889. Sinks, copper. Stamped-ware, national, 1882. Tin-ware : national, 1883 ; English, 1889. Water-coolers, filters, pails, fibre trust, national, 1888. Water-pails, wooden-ware, national, 1884. Wooden-ware, national, 1884. Laundry Borax. Clothes-pins, New York, 1888. Clothes-wringeis. Soap, national, 1890. Soda, 1S84. Starch; Western, 1882; national, 1890. Washboards, New York, 1888. Wash-tubs, wooden-ware, national, 1884. Washing-machines, national, 1891. Water-tubs, fibre trust, national, 1888. Zinc, sheet, 1890. Dining-room Butter-dishes, 1886. Cliina, England, 1888. Glass table-ware, 1889. APPENDIX 543 Plated-ware. Silver-plated ware. Silver-ware, national, 1892. Table cutlery, national, 1881. Table oil-cloth, national, 1888. Tables, extension-tables, national, 1893. Parlor For carpets, furniture, upholstery, etc., see under ",In General," above. Mantel lambrequin, wool felt, 1888. Music, books and instruments, Boston, New York, Chicago, Cincinnati, 1892. Organs, local, sectional, 1889. Parlor frame manufacturers. Parlor furniture, Western Association, 1886. Pianos, local, sectional, 1889; national, 1893. Piano-covers, wool felt, 1888. Picture-frames, 1890. Eugs, Eastern, 1885. Table-covers, wool felt, 1888. Tapestries, Eastern, 1885. Bath-room Bath-tubs (see " Copper "). Sanitary-ware, 1889. Sponges, Florida, New York, 1892. Bedroom Chintzes, Pennsylvania, 1886. Looking-glass : French silvered plate- glass, 1888; German, national, 1887; international, 1890. Spring beds, national, 1890. Wire mattress : Northwestern, 188C ; national, 1890. XIII. — "ode daily bread" Bread, biscuit, crackers, local, sec- tional, national. Butter, local, 1889. Candy, local, national, 1884. Canned goods : Western, 1885; national, 1889 ; California canned fruit, 1891. Cider and vinegar, national, 1882. Coffee, Arbuckle trust, 1888. Corn-meal, Western, 1894. Cotton-seed oil. Dairy Association, national, 1893. Eggs, local, in United States and Canada. Fish : England, 1749 and before ; New York and New England, 1892 ; salm- on, Alaska, 1891 ; salmon canners of the Pacific coast, 1893; sardines. Eastern, 1885 ; international, 1890 ; sardine canneries, Canada, 1893. Flour : United States, National Millers' Association, 1883; winter wheat mills, national, 1888 ; spring wheat mills of the United States ; millers of northeast England, 1889 ; rye flour, local, 1891 ; flour-mills of Utah and Colorado, 1892. Food Manufacturers' Association, United States, 1891. Fruit: bananas. Southern, 1888; Cali- fornia fruit-growers, 1892; cranber- ries. Cape Cod, 1888 ; England, 1884 ; Florida, 1889; foreign fruit. New York, 1884; Fruit-trade Association, New York, 1882; fruit-growers of the Eastern and Middle States against commission - merchants, 1887; pre- serves and jellies. Western, 18SS; American Preservers' Company, 1889 ; prunes, California ; strawberry-grow- ers, Wisconsin, 1892; watermelons, Indiana, South Carolina, 1889. Grape-growers, northern Ohio, 1894. Grocers : wholesale, retail ; local, sec- tional, national. Honey, local, 1888. Ice : local, sectional, 1883 ; artificial. Southern, 1889. Lard-refiners, Eastern, 1887. Meat and cattle : beef, mutton, pork ; Butchers' National Protective As- sociation ; Chicago packers ; Inter- mountain Stock - growers' Associa- tion, Utah, 1893 ; International Cattle Range Association ; Live-stock .Asso- ciation, 1887; Northwest Texas Live- stock Association, 1S7S ; Western Kansas Stock - growers' Association, 1883; Wyoming Stock - growers' As- sociation, 1874. 544 APPENDIX Milk : local, sectional, 1883 ; condensed milk, New York, Illinois, 1891. Oatmeal, 1885; Canada, 1887. Olive-oil. Oysters, local, 1890. Pea-nuts, 1888. Pickles, national, 1891. Produce : Produce Commission - mer- chants, eight large cities — North, Soutli, East, West, 1883 ; West, 1888. Raisins, California, 1894. Eice-mills, Southern, 1888. Salt: rock; English Salt Union, 1888; international, United States and Can- ada, 1889; Canada, 1891. Sugar: Hawaii, 1876; United State.s, 1887. Glucose, national, 1883; inter- national, 1891. Wine, California, 1894. IIT. — LIFE AND DEATH Artificial teeth, United States, 1889. Castor-oil, 1885. Cocoa-nut oil, American importers, 1881. Coffins, National Burial -case Associa- tion, 1884. Dental machines and supplies. United States, 1889. Drugs : importers ; druggists, retail, sec- tioual, national, 1883 ; wholesale, .sec- tional, national, 1884 ; Canada, 1874 ; manufacturers, national, 1884. Glycerine, New York, 1888. Life insurance, 1883, national, 1891. Patent medicines, national, 1884. Peppermint, local, 1887. Quinine, 1882. Tombstones, local, Brooklyn, Chicago, 1891. Vaseline. XV. — MlSCELLANEOnS Athletic clubs, 1893, to reduce charges made by prize-fighters for eichibition. Base-ball, national, 1876. Billiard-tables and furniture, 1884. Bill-posters,United States, Canada, 1872 Dime museums, national, 1883. Landlords' Union, London, England 1890. News-dealers, 1884; newspapers. As- sociated Press, United Press ; sec- tional, national. Photographers, national, 1889. Playing-cards. Printers, show and job, 1893. Racing trust, jockey club, 1894. Retailers, 1891. Small retail store- keepers of Kansas City protest againsi mammoth department stores. Safes, national, 1892. Theatrical trust. Interstate Amuse- ment Company, Springfield, 111., 1894. Warehouses : Brooklyn, 1887 ; national. 1891. INDEX ABnsnr language, use of, 319, 485. Acme Oil Compauv, Samuel Van Sjckel vs., 187. Adams, H. C, quoted on municipal mo- nopolies, 322. Adulteration of liquors, 27. Advice of counsel, 249. Alcohol in industry and politics, 20. Allen, TV. V., supplemental report on sugar-trust bribery, 404. American, early, refiners of petroleum, 39. American Transfer Company receives from 20 to 35 cents per barrel on all oil shipped by competitors, 99 ; the South Improvement Company reap- pears in, 100 : false map of, before New York Legislature, 101. Andrews, E. Benjamin, on prices under monopoly, 428 ; on oil-trust prices, 430 n. Anonymous circulars, in war against Toledo, 327. Artificial liquors, 27. Atchison, Topeka and Santa Fe Rail- road et al, William C. Bissell vs., 479. Atlantic and Great Western Eailroad and South Improvement Company, 48, 50 ; war of 1877, 88. Attorney - General, of Pennsylvania, management of tax-case against Standard Oil Company by, 170-81; of United States, on monopoly, 37; report for 1893, 3, 6 ; cases against the sugar trust, 401. 35 Austria, refineries of, consolidated, 439. Bad oil, 405-19. Baltimore and Ohio, and railroad war of 1877, 88 ; closes Baltimore to inde- pendent shippers, 102 ; withdraws rates, 221 ; freight agent escapes from Congress, 222. Baltimore closed to independent ship- pers by Baltimore and Ohio Railroad, 102 ; sale of refiiierie.^ at, 421. Bank of England's income compared with an American millionaire's, 459. Bankers indemnified for withdrawing bids on Toledo bonds, 336. Bankruptcy of oil refineries in 1873, 60 ; 1879-92, 455-70. Baptist, the Kational, quoted, 341. Barrel shipments better for railroads than tanks, 138, 231; destroyed by railroads, 138. Barrett, Judge, defines monopoly, 3 ; on sugar trust, 3, 4. Batoum refuses Rothschild permission to lay pipe line, 443. Baxter, Judge, decision on rebates paid oil combination, 207. Bee, Omaha Dcaly, investigates oil in- spection of Nebraska, 414. Beef, combination of packers of, 33, 36 ; price of, under combination. So. Belgium, 437. Bernheimer, Simon, testimony as to abundance of capital for early refin- ers, 41. " Big Four " combination, 35. 546 INDEX Binney, E. W., quoted, 40. Biscuit Association, 30. Bissell, William C, vs. Atchison, To- peka and Santa Fe Eailroad et at, 479. Black-mail, when competition is, 215. Blind-billing, 229 ; shippers benefited by, deny, 231. Blount, Representative, on subsidies and bribery, 394. Bolard & Dale M. National Transit Company, 165. Bonds not to refine, 79, 80. Books, natural -gas companies will not show, 363 ; oil trust keeps none, 469. Boston, South Improvement Company rates to, 47; fire marshal on bad oil, 411; prices of oil reduced from 20 to 8 by competition, 422. Boycott, of butchers by packers' com- bination, 35 ; how working-men were punished for, 287. Boyle, P. C, Ohio vs., 324. Bread Union in London, 30. Bremen, Congress of Chambers of Com- merce, 406. Bribery of jurors, 286; of Congress by Pacific Mail Steamship Company, 39-1. British government lowers test on oil, 436. Brooklyn, consolidation of street-rail- ways, 5. Brundied et al. vs. Rice, 239. Buffalo, explosion in Matthews' re6n- ery, 250 ; pipe line to, destroyed, 291 ; prices reduced by competition, 421. Buhl, Richardson vs., 10. Bulletin, New York Daily Commercial, on oil-trust prices, 430 n. ; on sugar trust, 32, 449. Burdick bill, Pennsylvania Legislature, 126. Burial Case, National Association, 37. Business, politics of, 403 ; " this belongs to us," 432 ; golden rule of, 495 ; runs into monopoly, 612. Butchers, independent, refused cars by Erie Railroad, 35 ; National Protec- tive Association, 34. Butterworth, Benjamin, represents Ohio before the United States Senate in the Payne matter, 376. Buyer, the only, refuses to buy, 106 ; only one, in Ohio, 107. Call, San Francisco, on commercial treaty with China, 449. Campaign contributions from trusts, 403. Campbell, B. B., averts outbreak at Parker, 106. Canada oil interests attacked by Amer- ican combination, 12; retail coal-deal- ers' associations, 15 ; Grocers' Guild, SO ; Parliamentary debate on Amer- ican oil prices, 424 ; Parliament re- duces tariff in 1894, 435; finance minister favors American oil trust, 435. Canadian Copper Company, litigation among stockholders, 403. Canal, independent shippers escape by, 96 ; tank-boats for, 96 ; railroad war against, 97. Cancer, hospital for, endowed, 181. Capital, of combinations, 4 ; easy for early refiners to get, 41 ; of oil combi- nation, 457. Ciirlyle, Thomas, on literary freedom in America, 529. Cars, refusal of, by railroads to inde- pendent shippers, 12, 91, 94, 106. Carter, J. J., vs. Producers' and Refin- ers' Oil Company, Limited, 164, 446. Cassatt, A. J., testimony concerning rail- road war of 1877, 88 ; on lower rates to Standard Oil Company, 94 , 472 ; on refusal of cars and rates, 94 ; on cheapness of oil, 42S. Cattle combination, 5, 83 ; traffic, rail- road preferences in, 33 ; decline in prices of, 34 ; shippers discriminated against by the railroads, 36. Cattle Range Association, International, 34. Census, United States, on petroleum, 39 ; sugar trust refuses to answer ques- tions, 404. INDEX 54? Charity decreases under monopoly, 502. Cheapness of oil, 420 ; under the trusts, 431 ra. ; how produced, 464-65 ; analy- sis of, 500. Chicago and Northwestern Railroad, charges for oil and cattle compared, 481. Chicago, number of dry-goods stores in, , in 1894, 488 ; Union Stock Yards, se- crecy as to ownership of its stock, 487. China, commercial treaty with, 449. Church and wealth, 294. Cincinnati, New Orleans, and Texas Pacific Railway, Ohio vs., 220 ; " mis- takes," 234. Cincinnati, Washington and Baltimore Railway, Ohio vs., 220. Circulars, anonymous, in war against Toledo, 327. Claniorer for dividends, 101. Clarion County, Pennsylvania, indict- ment of members of Standard Oil Company, 170, 258; Supreme Court of Pennsylvania interferes, 180. Clark, Horace F., on South Improve- ment Company contfact, 50. Cleveland, disadvantages of, for the oil business, 53, 464 ; starting-point of the founders of the oil combination, 44 ; South Improvement Company rates to, 46 ; pipe line to, 65 ; pioneer refiner, 73 ; crude oil carried to, free for oil combination, 85. Cleveland and Marietta Railroad, Handy vs., 206-S. Cleveland, President, on sugar Uriff, 404. Clinton, De Witt, on petroleum, 38. Coal, combination, capital of, 4 ; in Nova Scotia, 5, 11, 461; State, national, and judicial investigations, 9 ; bitumi- nous lands bought by railroads, 11; anthracite monopolized by railroads, 11, 14; freights on, higher in 1893 than in 1S79, 13; independent pro- ducers crushed by railroad discrimi- nations, 13 ; miners oppressed by coal compauies, 16, 17; price of, advanced by combination, 14, 431 n. ; extortion of anthracite monopoly, 14 ; combina- tion between American and Canadian dealers, IS ; retail associations of dealers, 16; dealers terrorized, 15; miners, freedom under competition, 16 ; miners' strike in Pennsylvania in 1871, 16 ; policemen in Pennsyl- vania, 18. Coffin combination, 37. Coke, Lord, on monopolies, 406. Collusion between oil trust and rail- roads, 143, 482-4. Colorado, oil war in, 427 ; prevented by railroads from shipping its oil to Pa- cific States, 427, 481. Columbus, Miss., war on merchants of, 300 ; Ohio, gas shut off, 365. Combinations, capital of, 4. Communipaw, monopoly of terminals at, 142. Competition, impossible in the meat and cattle business, 36 ; oil combina- tion likes, 87; when it is black-mail, 215; cuts price, 281, 294; power for evil, 422. Congress, investigation of South Im- provement Company suppressed, 45 ; bribing by Pacific Mail Steamship Company, 394. Conspiracy, adoption of, 277. Constitutional amendments concerning trusts, 451 ; convention of New York, 1894, 451. Contract to restrict refining, 6-2; to shut down oil flow, 153; between dealers and the oil combination, 425. Corners, 4. Cotton-eeed oil, rates on, 232. Court records gone in Cleveland, S3 ; mutilated transcript for Congress, 244, 267 ; records mutilated in Cali- fornia, 484, Coxe Brothers & Company vs. the Le- high Valley Railroad Company, 19. Cracker-bakers' meeting, 30. Dayton, experience with natural - gas company, 864. Deaths from bad oil, in Michigan, 416 ; 548 INDEX in Great Britain from explosireness of American oil, 410. Delay, before Interstate Commerce Commission, 147, 149, 150; in legal procedure in New York, 285 ; of Pennsylvania Supreme Court in act- ing on appeal of independents, 447. Democratic party and sugar trust, 404. Detectives and coal -dealers, 15; rail- roads as, 48 ; in Wall Street, 334. Detroit Times, on reduction of oil test, 416 ; TrUnme, on reduction of oil te.^t, 416. Deffar,Thomas S., letter of United States Commissioner of Internal Kevenue to, 26. Discrimination in favor of oil combina- tion, " wanton and oppressive," 207 ; of 333 per cent., 217 ; called "a vast discrepancy," 219; Supreme Court of Oliio on, 219; against Rice, Inter- state Commerce Commission on, 227 ; charges of, sustained by Interstate Commerce Commission, 235 ; by nat- ural - gas company in rates for gas, 365 ; no, by German railroads, 438 ; inures to the benefit of one power- ful combination, 478. (See Freight Eates, Railroads, Rebates.) Dismantling of petroleum refineries, 42, 72 ; Joshua Merrill's refinery, 1S8. Disorder, pubUc, in oil regions, 43, 54 ; in Pennsylvania, 1878, 105,106; in Pennsylvania and Ohio, 456. Dividends of oil trust, 246 ; of sugar trust, 32, 33, 404. Dodd, S. C. T., on " parent of trust system," 8 ; in Pennsylvania Consti- tutional Convention of 1872, 55 ; on pipe lines, 117; on pipe -line rates, 125 ; on bonuses to railroad officials, 4S6. Drake, E. L., strikes oil, 40 ; pensioned, 462. Dressed-beef men, railroad rates to, 36. Dynamite, and the whiskey trust, 21 ; in the "shut-down" of 1887, 154; threats of, against Toledo City pipe line, 357 ; oil that is as dangerous as, 416. Electricity, 9. Elevators, combination of Northwestern railroads with, 5, 31 ; State erection and operation of, recommended by Minnesota Legislature, 31. Embargo on sales of oil, 1872, 56. Emery, Jr., Hon. Lewis, testifies as to " immediate shipment," 104. Eminent domain, use of, by railroads, 97. Empire Transportation Company, 87. Engineers, Society of American Marine, protest against foreign engineers, 399. England oil trade meets to protest against poor American oil, 405. Equality, railroad idea of, 86. Erie Canal used by independent ship- pers, 96. Erie Railroad, refuses cars to indepen- dent butchers, 35; New York Legislat- ure investigate.", 43 ; and South Im- provement Company, 48, 50 ; refuses rates to competitor of South Improve- ment Company, 52 ; railroad war of 1877, 88; its oil-cars owned by oil combination, 92 ; payments to Amer- ican Transfer Company, 99 ; contract with Standard Oil Company, 102 ; renews broken promises of equal rates, 119; invites independent re- finers to rebuild, 119; refuses to ship independent oil to seaboard, 140; sends armed force against indepen- dent pipe line, 161 ; gives land to oil trust's pipe lines, 162 ; destroys pipe line by force, 291. "Evening" pool of cattle-shippers, 33. Everest et al, People of the State of N. Y. vs., 244. Ezaminer, The, quoted, 341, 345. Expert testifies about pipe-line pool, 86; false maps of American Transfer Company, 101. Explosions, in distillery, 21 ; during "shut-down," 154; in Buffalo re- INDEX 549 finery, 250 ; Louisville, 252 ; Roches- Furnaces, 9. ter, 252. Explosiveness ot petroleum gases, 282; of American oil compared with Scotch and Russian, 410. Extradition treaty between Russia and America, 448. False accounts, 64. Fellows et al. vs. Toledo ei al, 314. Field code of New York, 285. Fires from bad oil, in Great Britain, 410; in Boston, 411; in Iowa, 413; in Michigan, 416; in San Francisco, 416 ; at Oil City and Titusville, June 5, 1892, 417; in Bradford refinery, 447. Fish, 32. Flour, dearer, wanted, 30. Forbes, John M., speech on free ships, 393. Foster, Charles, as Secretary of the Treasury favors retention of foreign captains, 398; issues license to for- eign engineers, 399 ; his part in the war on Toledo, 400. Fostoria, Ohio, Sunday raid on the flour- mill, 348. Foueon, Felix, in Revue des Deiix Mondes, 39. France, manufactures coal-oil in 1845, 38 ; government of, lowers oil tariff, 440; oil refiners of, make terms with American oil trust, 441. Free breakfast-table, 32. Freight rates on coal, 13; discrimina- tions investigated by Ohio Legislat- ure, 44 ; 8 cents a barrel less than nothing on oil, 88 ; rates advanced by pipe and rail, 122 ; rates increased at instance of oil combination, 132; rate 88 cents to oil combination, $1.68 to competitors, 210; increa.=ed 333 per cent, to one shipper, 217. (See Re- bates, Discriminations.) Freight-handlers strike, 296. Fruit, 32. Frve, William P., on subsidy to Interna- tional line, 391, 395. Gas, 9; natural, 9,305. Geologist, State, of Ohio, takes sides in Toledo contest, 329. Germany changes oil tariff, 437 ; the German-American Oil Company, 437 ; decline in prices, 438 ; independents in, 439. Gladden, Rev. Washington, on oil trust, 344. Good society, 627. Gospel Cars, 237. Government and monopoly, 311. Governors, steam-boiler, 9. Gowen, Franklin B., on war against Tide- water, 108, 110; admits surrender of Tidewater Pipe Line, 112; severs con- nection with Tidewater, 114; speech before Pennsylvania Legislature,1883, 115; on Supreme Court of Pennsyl- vania, 181 ; on yearly loss of railroad revenue by rebates, 491. Grand Trunk saves independent oil re- finers, 136. Granger movement, 371. Great Britain, Railway Commission of 1873, 369 ; government lowers test of oil, 408. Griffin, C. P., representative of Toledo in State Legislature, 333. Grocers' Guild, Canadian Parliament on, 30. HAnnocK, John C, testimony of, JS. Hadley, A. T.-, on British railroads, 370. Hale, J. P., quoted, 462. Hamilton, Alexander, on power over sub- sistence, 529. Hancock, Erie stops independent pipe line, 162. Handy vs. Cleveland and Marietta Rail- road, 206. Ilarter, the Isaac Harter Company vs. the Northwestern Oliio Natural - gas Company, 349. Hatch, Edward, quoted, 255, 2S1. Haul, long and short, 221, 222, 223. Heaters, hot-water and steam, 9. 550 INDEX Herald, Boston, on relations of oil com- bination and State inspectors, 411. Hermann, Von, on Paris Exhibition of 1839, 39. Highway, ownership of, is ownership of all, 12. Hoar, George F., on oil trust in the President's Cabinet, 401. Holland, 437. Hopkins, Representative, moves for In- vestigation of railroads by Congress, 372. Human nature, 526. Illinois Central Railroad, "mistakes," 234. Immediate shipment, 104. Improvement companies of Pennsyl- vania, 65. Income of members of oil trust, 459. Independent, the New York, quoted, 348. Independents, rates withdrawn from, by Pennsylvania Railroad, 90; Penn- sylvania Railroad refuses cars to, 91 ; Pennsylvania Railroad increases rates to, 91 ; crushed by oil combination's use of railroad terminals, 102 ; prom- ised equal rates again, 119 ; invited to rebuild by the railroads, 119 ; attacked by Pennsylvania Railroad after being invited to rebuild, 120 ; survive attack by railroad and oil-trust pool, 128 ; ap- peal to Interstate Commission, 1 888, 128 ; discrimination against, 130 ; freight rates to, increased at suggest- ion of oil combination, 132; forced to close their works, 135 ; saved by Grand Trunk Railroad, 136; lose trade of New England, 1888, 136 ; forced to sell oil to combination, 140; prevented by railroads from using tank-cars, 140 ; exactions suffered by, at the sea-board, 141; appeal to Interstate Commerce Commission against delay, 148 ; lose five years' business, 149 ; get tank- cars and terminals, 161 ; project pipe line to the seaboard in 1887, 152; in 1892, 160 ; pipe line stopped by Erie cannon at Hancock, 162; survival of, delays Russian- American division of world's oil market, 445 ; delay of Pennsylvania Supreme Court in act- ing on appeal of, 447 ; in Germany, 439. Indianapolis People's Trust, 320. Individuality, 527 Industry, new law of, 12. Inspection, State, used to end competi- tion, 215, 216. Inspectors, State, also in employ of those they inspect, 216,411 ; of oils in New York represent oil combination in Bremen congrcss,406; in Iowa, charged with allowing sellers to brand oil, 412 ; sued in Iowa for damages for passing bad oil, 413; in Minnesota, investi- gated by State Senate, 413; in Illi- nois, 415; in Nebraska, 414-16. International steamship line subsidized, 389-400. Interstate Commerce Commission, on coal rates, 13 ; Pennsylvania inde- pendent coal-mine operators appeal to, 19; decision on coal rates disre- garded by the Pennsylvania rail- roads, 19; on pool of oil combina- tion with Tidewater Pipe Line, 113; refuses to require production of se- cret contract between railroad and pipe line, 124 ; bullied by counsel of Pennsylvania Railroad, 124 ; orders reduction of freight rate on barrels in South, 130 ; decision misapplied by Pennsylvania Railroad, 131 ; in- terview with Pennsylvania Railroad officials, 132 ; correspondence with president of Pennsylvania railroad, 132 ; orders discrimination stopped, 139 ; on monopoly of terminal facili- ties, 142; chairman on collusive re- lations of oil trust and railroads, 143 ; witnesses refuse to appear before, 145 ; refrains from decision in case of Pennsylvania Railroad, 146 ; de- cision in Rice, Robinson, and Wither- op case, 1890, 147 ; delays for two years decision against Pennsylvania Railroad, 147; grants Pennsylvania INDEX 551 Railroad rehearings for two years, 148 ; railroads disobey orders of, 149 ; decision against Pennsylvania Kail- road, 1892, 149; brings independents no help, 149 ; proceedings before, re- garded by railroads as only prelimi- nary to litigation in the courts, 150 ; cannot decide after three years' hear- ings, 150; grants Pennsylvania Rail- road further delay, 150; George Rice lets cases before, go by default, 151 ; theatre for litigation and delay, 160; calls discrimination " a vast discrep- ancy," 219; decides refusal to give rates "illegal," 224; on discrimina- tions against Rice, 227 ; on " aston- ishingly low " rates, 232 ; on " mis- takes " of railroads, 234 ; sustains charges of discrimination, 235 ; on control of industry by the oil combi- nation, 433 ; on immense power of oil combination, 458 ; describes pref- erences given to the oil combination, 4V8. Interstate C!ommerce law, only convic- tion under, 19 ; disobeyed by railroad managers, 218; opposed by Senator Payne, 388 ; Senator Cullom on rail- roads' excuses for violating, 498. Investigation, of South Improvement Company by Congress, in 18Y2, not continued, 60 ; of railroad discrimi- nations by Congress, suspended, 1876, 71 ; testimony stolen, 373. Investors^ Review, of London, on English government jobbery, 450. Iowa, Governor of, refuses to investigate charges of violation of inspection law, 412. Iron, railroads buying iron lands, 12 ; in- terests of members of oil combina- tion, 461. Italy, 440. Jackson, Judge H. E., sustains Toledo, 315. Joy, Professor, on explosiveness of naphtha, 253. Judge, Federal, quashes indictment against secretary of whiskey trust, 22 ; of Supreme Court of Pennsylvania, charged with violating the law, 181 ; fixes damages inVan Syckel's case at 6 cents, 195; excludes evidence against oil trust members, 268 ; rules out evi- dence concerning oil trust, 273 ; or- ders acquittal of members of oil trust, 278; how made, 296; decides anti- trust law not applicable to sugar trust, 404. Jurors bribed to petition for mercy, 286. Justice, delay of, 149. Kanawha salt-wells, 462. Karns, General S. D., suggests pipe- lines, 41. Keystone re6nery, 291 ; causes Oil City disaster, 418. King's horses and king's men, 1 98. Knight, E. C, et al., United States vs., 404. Laiises-faire, true, 497. Lake Shore and Michigan Southern Railroad and South Improvement Company, 48, 50 ; contract with the oil combination, 69 ; Scofield el al. vs., 70; railroad war of 1877, 88; contracts to give a tenth of all oil freights to oil combination, 89 ; gives its oil traffic to competing pipe line, 127. Lamennais quoted, 507. Lands, ownership changes, of coal, 11; of oil, 434. Laugh, the, 267-71. Law, Anti-trust, 3, 6, 404; Pennsylva- nia Free Pipe- Line, worthless, 67 ; delays of, 285 ; of oil inspection, how changed in Nebraska, 415. (See Inter- state Commerce). Lawson, J. D., Leading Cases SimpUfied, 181. Lawsuits, threats of, 27S, 289 ; to crip- ple competition, 290. Lawyers, officers of the court, 114 ; re- lations of, to law-breakers, 249 ; pam- phlet against Toledo issued by, 354. 552 INDEX Leases, oil and gas, rights claimed un- der, 306. Leather, 5. Lehigh Valley Railroad Company, Coxe Brothers & Co., vs., 19 ; railroad war of 1877, 88. Little, John, represents Oliio before the United States Senate in tlie Payne matter, 376. Locomotives, 9. Louisville and Nasliville Railroad turns another screw, 213 ; " mistakes " of, 234. Mail, New York, on income of mem- bers of oil trust, 459. Mails, slower under subsidy, 397. Maine, Sir Henry Sumner, on trade, 507 ; on contract and status, 533. Marcy, W. L., in Buffalo explosion case, 259. Marietta, freight rates raised against refiners at, 200. Market, for oil, becomes erratic, 42 ; manipulation by oil trust, 104, 164, 420, 439 ; only one buyer, 104. Matches, 9 ; combination. Supreme Court of Michig.in on, 10. Mather, People vs., 277. Matthews, C. B., experiences of, 243-98. Matthews, Hon. Stanley, 67 ; on the re- bates of the oil combination, 69. Maxim gun, Euglish War Office oppo- sition to, silenced, 450. McClellan, Gen. G. B., on South Im- provement Company contract, 50. Meat combination, 5 ; at Chicago, 33. Medicine, adulterated liquors for, 27. Merrill, Joshua, 39 ; testimony before Congress, 18S ; appeals to Railroad Commission of Massachusetts, 189 ; pioneer in oil, 463. Michigan State Board of Health on fires and deaths from bad oil, 416. Mileage paid to preferred shippers, 233. Millers' national conventions, 30. Millionaires, abolition of, 312, 524. Minnesota Lccislature recommends State elevators, 31 ; Senate investigation of oil inspectors, 413. "Mistakes," by railroads not corrected, 138 ; always in favor of preferred sliippers, 223, 234. Monopoly, defined by Federal courts, 3 ; Judge Barrett defines, 3 ; differ- ence of definitions, 3, 6 ; defined by United States Attorney-General, 37 ; of Standard Oil Company, Supreme Court of Ohio on, 70 ; ignorance of the public is tlie real capital of, 117 ; must control all, 298 ; and govern- ment, 311 ; Lord Coke on, 405; E. Benjamin Andrews on price manipu- lation, 428; State, advocated by national economists in Germany, 438 ; of oil in Germany, 438 ; Ohio Su- preme Court and New York Supreme Court pronounce Standard Oil Trust a, 453 ; and industry, 518; and lib- erty, 519. Monotony, 527- Monthly reports required by the oil combination, 62 ; from producers in " shut-down," 155 ; of competitors' shipments, 212. Morris, " Billy," inventor of the " slips," 463. Municipal enterprise better and cheaper than private, 360. Mutilation of court records, 83, 244, 267, 484. National Transit Company, 87; con- trols pipe -line business, 113, 114; owned by oil combination, 113; president of the oil combination de- nies connection with, 1 14 ; Bolard & Dale vs., 165 ; secrecy as to owner- ship of its stock, 487. Natural -gas company owned by Stand- ard Oil Trust, 337. Nav3', Secretary of, urges subsidy, 389 ; and nickel appropriation, 402 ; rela- tions to subsidy, 402. Netherlands, East India colonies, 441. Nettleton, Assistant Secretary of the INDEX 553 Treasury, rules against retaining for- eign captains, 398. New England, trade in, lost by inde- pendent refiners, 136. Newport News and Mississippi Valley Railroad, " mistakes," 234. Newspapers controlled by oil combina- tion, 160. (See Press.) New York Central Railroad, and South Improvement Company, 48, 49; re- fuses rates to competitors of South Improvement Company, 62; war of ISVT, 88 ; contracts to give a tenth of all oil freights to oil combination, 89 ; oil cars of, owned by oil combination, 92 ; payments to American Transfer Company, 99. New York, People of, vs. North River Sugar Refining Company, 3; refiners do not dare to build large refineries, 107 ; People of, vs. Everest et cl., 244 ; legal procedure, 285 ; Railway Commission of 1857, 370; in danger from refineries and tanks, 419 ; Sen- ate committee on oil trust and prices, 429 ; Constitution of 1846 on rail- roads, 370 ; Constitutional Convention of 1894, 451 ; " Hepburn " legislative investigation on rebates, 476. New York and New England Railroad, oil trustee president of, 189. New Zealand Fire Insurance Company sues for losses by bad oil, 416. Nickel appropriation, 402. North River Sugar Refining Company, People of New York vs., 3. Northwestern Natural - gas Company, the Isaac Harter Company vs.., 349. Notice, freights raised without, 136, 200. "Not yet," president of the oil trust, 454. Nova Scotia coal-mines, consolidation of, by American syndicate, 5, 12, 461. Ohio, oU-field, oil combination the only buyer of oil in, 107; Supreme Court of, on discriminations, 219; State of, vs. Cincinnati, New Orleans, and Texas Pacific Railway, 220; State of, vs. Cincinnati, Washington, and Balti- more Railway, 220 ; vs. Standard Oil Company, 239, 463; senatorial elec- tion of 1884, 373; Legislature de- mands investigation of the election of Senator Payne, 374 ; Legislature de- feats free pipe-line bill, 385 ; State of, vs. City of Toledo, 314; State of, vs. P. C. Boyle, 324 ; distress among oil producers in 1892, 456 ; Legislative report of 1879 on relations of rail- roads and oil combination, 477. Ohio Oil Company vs. Toledo, Findlay and Springfield Railway, 306. Oil, Canada, 12; Canada producers at- tacked by American combination, 12. Oil City fire, June 6, 1892, 417. Oil combination, parent of trust system, 8 ; founders of, 44 ; and South Im- provement Company the same, 49 ; president of, explains its origin, 63 ; contracts with competitors to limit production, 61, 65; requires monthly reports, 62 ; insists on secrecy, 63, 65, 79 ; use of spies by, 65, 298, 334 contract in restraint of trade, 66 profits of restraint of trade, 66, 67 restricts its capacity one -half, 68 rebates from the railroads, 69, 474- 87 ; scarcity the object of, 72 ; con- trol of transportation, 76; buys out its widow competitor, 78; puts her under bonds not to refine, 79 ; binds competitors not to refine, 79, SO ; secret of success, testimony of presi- dent, 80 ; value of the " works " of, 82; issues $90,000,000 of stock on $6,000,000 of works, 82; buys oil plant of Pennsylvania Railro.ad, 88 ; owns oil cars of New York Central and Erie railroads, 92 ; member of, denies, then admits, rebates, 95 ; re- ceipts from American Transfer Com- pany, 100, 101 ; owns United Pipe Lines, 101 ; owns American Transfer Company, 101 ; controls railroads' oil terminal facilities, 102 ; uses railroad terminals to crush opposition, 102; D54 INDEX forces producers to sell below the market, 104 ; will not pipe or buy oil, 106, 164 ; shuts back Ohio oil wells, 107; restricts production in Ohio, 107 ; the only buyer of oil in Ohio oil- fields, 107; and railroads fight the Tidewater Pipe Line, 108 ; cuts prices of pipeage, 109 ; speculates on its " advance knowledge " of cut in freight rates, 110; enters into pool with Tidewater Pipe Line, 112; owns National Transit Company, 113; had no pipe line to seaboard, 116; builds pipe line to seaboard, 116; builds pipe lines from rebates given it by railroads, 116, 118; and railroads ad- vance rates, 118; secret contract of 1885 with Pennsylvania Railroad, 120; guarantees Pennsylvania Rail- road 26 per cent, of the oil traffic, 121 ; and Pennsylvania Railroad ad- vance rates, 122 ; pool with Pennsyl- vania Railroad, 123 ; advances pipe- line rates, 125, 126; Interstate Com- merce Commission, on discrimination in favor of, 130 ; gets New England business of independents, 137 ; con- trols seaboard terminals of railroads, 142 ; keeps Oil City and Titusville re- fineries closed, 143 ; prompts railroad litigation before Interstate Commerce Commission, 144 ; makes contract with producers to shut down wells, 153; compels subordinate companies to make monthly reports, 155; op- poses piping of refined oil, 165 ; owns $40,000,000 in 1883 in Pennsylvania, 166; Pennsylvania tax case, 166; Clarion County indictment, 170; mem- ber of, admits rebates, 188 ; president New York and New England Rail- road is member of, 189; prevents trial of Van Syckel's process of refin- ing, 191 ; member of, forecloses mort- gage on Solar refinery, 193 ; "another way of getting rid " of competitors, 200; makes money by closing its re- fineries, 201 ; how its earnings are pooled, 201 ; its freight rates lowered while competitors' rates are raised, 202 ; gets rebate of 25 cents out of 35 cents in freight, paid by competitor, 206 ; not popular in the South, 209 ; competes with grocers, 214,300 ; rela- tions to State inspectors, 216, 413; denies receipt of discriminating rates, 219; Supreme Court of Ohio on mo- nopoly of, 220 ; denies blind-billing, 231; denies receipt of mileage, 234; denies discriminations, 236 ; pleas- ant relations with competitors, 243; dividends of, 246 ; political power of, 260, 372-404; and press, in Penn- sylvania, 160; in Buffalo, 298; in Toledo, 317, 327; defeated in suits on patents, 290; brings suits to em- barrass competitors, 290; buys from the court suits against itself, 293 ; refuses to meet competitive prices, 299 ; abandons suit against Toledo in United States Supreme Court, 331 ; detectives of, in Wall Street, 334; evangelical and explosive, 368 ; natu- ral-gas companies, profits of, at To- ledo, 362 ; spends money in elections, 386 ; members of, interested in sub- sidy legislation, 390; acts with both political parties, 403 ; defence before Bremen congress, 406 ; its success ex- plained by the president, 407 ; has State inspectors in its pay, 411; re- stricts production, 420 ; buys Balti- more refineries, 421 ; binds dealers not to buy of its competitors, 425 ; oil made scarce by, 68, 420-29; price of oil under, 67, 420-29, 431 n.\ drives out schooners, 433 ; controls 90 per cent, of industry, 433 ; push- ing into every part of the world, 434 ; owns no oil lands in 1880, 434 ; large buyer of oil lands, 434 ; favored by Canadian government, 435 ; in Germany, 437 ; sells refined oil in Europe cheaper than crude, 439 ; in France, 440 ; denial of negotiations with Russian oil-men, 442 ; admits ne- gotiations with Russian oil-men, 442 ; reasons for war upon independents. INDEX 555 455; and Extradition Treaty with Russia, 448 ; prosperous during panic, 455 ; growth of capitalization of, 457 ; produces "infinitesimal amount" of oil, 463 ; not an inventor, producer, pioneer, or capitalist, 464; produces poverty, 464-66; principals of, not practical oil-mco, 466, 46'7 ; members of, deny rebates, 476; secrecy as to ownership of certain shares, 487. Oil, regions, early prosperity of, 42, 43 ; public disorder in, 43 ; producers re- fuse to sell to members of South Im- provement Company, 56 ; running on the ground, 91, 105, 106, 164; Euro- pean congress on poor quality of American, 406 ; test of, lowered in Great Britain, 408 ; financial distress ill 1879-92, 455-56. Pacific Mall Steamship Company, report on bribery of Congress by, 394. Pacific Railway officials admit rebates, 480. Packers' Combination at Cliicago in- vestigated by Congress, 33. Paint, to conceal numbers of tank-cars, 235. Pall Mall Gazette on prices of refined and crude oil, 439. Panics in oil, 43. Parker district, on verge of civil war, 106. Pastor, visit from tlie, 294. Payne, Henry B., objects to investiga- tion of railroads, 70, 372 ; election of, to the Senate of the United States, 374; candidate for President, 387; votes against Interstate Commerce Commission bill, 388 ; solicits Demo- cratic votes in the Senate for confir- mation of Republican nominee, 400. Peckham, S. F., United States Census report on petroleum, 39, 41 ; on rail- roads and tank-cars, 228. Pennsylvania, Constitution of 1873 dis- obeyed by the railroads, 18 ; Legis- lature nullifies Constitution in inter- est of railroads, 18 ; uprising of 1872, 64 ; Constitutional Convention, 1873, 54; Commonwealth of, vs. Pennsyl- vania Railroad et al., 1879, 94 ; Secre- tary of Internal Affairs hung in effigy, 105 ; Attorney-General brings tax suit against Standard Oil Company, 169; Legislature investigates Standard Oil Company tax case, 176 ; Supreme Court of, delays hearing on appeal of independents, 447; Constitution on railroads, 461 ; Secretary of Internal Affairs on relations of railroads and oil combination, 477. Pennsylvania Railroad and South Im- provement Company, 48 ; and Im- provement Company charters, 55 ; put under bond not to refine, 79 ; keeps faith " some months," 84 ; reaches out for control of oil trade, 87; carries oU at eight cents a barrel less than nothing, 88 ; sells its refineries and pipe lines, 88; contracts to give a teuth of all oil freights to oil combi- nation, 89; pledges not to compete with oil combination, 89 ; withdraws rates from independent refiners, 90; officials threaten independent pipe lines, 91 ; officials recommend " fix- up" with the oil combination to inde- pendent shippers, 90, 91 ; increases . rates, refuses cars, to independent shippers, 91 ; refuses to haul cars owned by independent shippers, 92 ; refuses a business of ten thousand barrels of oil a day, 93 ; Common- wealth of Pennsylvania vs., 1879, 94 ; pays American Transfer Company three mouths' back pay, 99 ; refuses to furnish cars to oil producers, 106 ; offi- cials testify to war on Tidewater Pipe Line, 109; discriminations against re- fineries using the Tidewater, 110; Titusville and Oil City Independent Refiners' Associations vs., 118, 165; renews broken promises of equal rates, 119 ; makes war on refiners it invited to rebuild, 120; secret contract of 1885, witli oil combination, 120 ; guaranteed 26 per cent, of seaboard 556 INDEX oil traffic by oil combination, 121 ; re- fuses to produce contract witli oil combination, 121 ; and oil combina- tion advance rail and pipe rates, 122; oil rates of, extortionate, 123; coun- sel of, bullies Interstate Commerce Commission, 124; perverts decision of Interstate Commerce Commission, 131 ; increases rates to barrel ship- pers, 131 ; ignores directions of Inter- state Commerce Commission, 1 33-34 ; refuses to haul tank-cars for inde- pendents, 140; Interstate Commerce Commission delays for two years to enforce law against, 147 ; gets another rehearing from Interstate Commerce Commission, 150; said to run Su- preme Court of Pennsylvania, 181 ; divides the coal business of Pennsyl- vania among three dealers 490. Perth Amboy, independent shipments from, 135. Peru, 441. Petroleum, combination in, 38—493 ; De Witt Clinton's suggestion, 38 ; early manufacture of, 38, 44 ; Reichen- bach's prediction, 38 ; in exhibitions of 1839 and 1851, 39 ; early American refiners, 39 ; early American manu- facturers ready for new supply of oil, 40; price of, in 1862, 40. Petroleum Producers' Union, report of General Council of, on attempts to lessen production of oil, 153. Phantom Party, in McKean County, 105. Philadelphia, Sharpless vs., 315. Phillips, AVendell, on Pennsylvania Rail- road, 14Y. Piano-makers' combination, 5. Pilots, Brotherhood of Steamboat, pro- test against foreign engineers, 399. Pioneer refiner of Cleveland, 73. Pipe lines, origin of, 41 ; first laid by Van Svckel, 41 ; Pennsylvania Free Pipe Line law worthless, 57 ; to Cleveland, 65; number of, in 1874, 84; Eighty per cent, of, died in 1874-5, 84; pool of 1874, 85; frozen out, 87; bankrupt, bought up by oil trust, 87 ; Equitable Pipe Line proposed, 91 ; independent, threatened by Pennsyl- vania Railroad, 91 ; United Pipe Lines, owned by the oil combination, 101 ; industry closed to the people, 1877, 104; refuse to carry oil unless sold to oil combination, 104 ; of oil com- bination refuse to pipe, 106; Tide- water, first to seaboard, 107; rates cut by oil combination in war with Tidewater, 109 ; to seaboard not built first by the oil combination, 116 ; competitors of the railway, 116 ; New York Sun on, 117; pool Tviih railroads, 121 ; cost of service, 122 ; rates of, advanced by oil combination, 125, 126 ; profits of, 126 ; rates higher under the oil combination, 125, 126; independent, to seaboard projected in 1887, 152 ; in 1892, 160 ; oil combina- tion lays, upon railroad right of way, 162 ; refuse to take oil, 1893, 164 ; in- dependent, transport refined oil, 165; built by George Rice, 208 ; indepen- dent, destroyed by Erie Railroad by force, 291 ; Toledo builds better than private company, 360 ; bill for free, defeated by the Ohio Legislature, 385 ; independent, and Russian-Amer- ican monopoly, 445; independent, consolidate in 1894, 446; indepen- dent, cut, 447. (See Tidewater Pipe Line). Policemen, coal and iron, 18. Politics of business, 403. Pool, steamship, 395 ; for sale of oil, 420. Poor's Railroad Manual, railroad inter- ests of members of oil combination, 460. Pork, combination of packers of, 36. Postal subsidy law, passed, 389-400 ; payment under, 396 ; Postmaster-Gen- eral makes sutisidy contracts, 390 ; his relations to those who receive post- al subsidies, 403. Poverty, abolition of, 526. Premium on oil advanced, 144. President of the oil combination denies INDEX 657 contracts with railroads, 51 ; on " ways of malting money you know nothing of," 52 ; the " only party that would buy," 52; offers 50 cents on the dol- lar,52; explains itsorigin,53 ; testifies about Southern Improvement Com- pany, 69 ; member of South Improve- ment Company, 60 ; denies contracts to restrict competition, 61 ; testifies to " very small profit," 67 ; argues for restriction of production, 68 ; denies that it gets cheaper freights, 70 ; tes- tifies as to secret of success, 80 ; tes- tifies that it likes competition, 87; knew about freight rates, 96 ; cannot recall discriminating freight rates, 96; frequents office of Krie Railroad, 102; denies pool with the Tidewater Pipe Line, 113; sole attorney of the trust, 114 ; denies any connection with Na- tional Transit Company, 114; denies the "shut-down" of 1887, 158; de- scribed by Van Syckel, 184; interview about rebates on Rice's business, 207; on pleasant relations with competitors, 243; testifies the oil trust is not a manufacturing company, 272; tes- tifies to reports by subordinate com- panies, 274 ; does not know about monthly reports by subordinate com- panies, 274; explains its success, 407 ; on its cheapness, 420 ; in the commission business, 432 ; on its ownership of oil lands, 434 ; its prop- erties " not yet " sufficiently numer- ous, 454; testifies to shares in the trust owned by trustees individually, 458; "does not know," 467-68; made attorney of the trust, 470. President of the Standard Oil Com- pany denies ownership of company by Standard Oil Trust, 458. Press, and oil combination, 160, 298, 317, 327; use of, to make subsidy popular, 392; Pliiladelphia, on Rus- sian Extradition Treaty, 448. Price of oil advances under restraint of trade, 66, 67; under oil combination, 67, 420, 431 n. ; manipulated by oil combination, 104; in Ohio, 107; in New York and Europe, 164; higher for crude than for refined oil, 164 ; manipulation of, 210; lowered by competition, 281, 294 ; advances after Baltimore consolidation, 421 ; regu- lated by committee, 421 ; in New York, fixed by oil combination, 423 ; in Texas, independent of competition, 423 ; evidence gathered by Congress, 423 - 24 ; put higher after " w.irs " than before, 424 ; fixation of, 425 ; E. Benjamin Andrews on, 430 n. ; New York Daily Commercial Bulletin on, 430 n. ; under trusts, 431 ■«. ; decline in Germany, 438 ; refined oil lower than crude, 439 ; under monop- oly, 502. Private enterprise and public, 311. Producers of oil, and South Improve- ment Company, 54; organization in Pennsylvania, 56 ; embargo broken, 57; Union, report, 1872, 60; forced to sell oil to trust, 104 ; forced to sell below market price, 105 ; lose their land, 434. Producers and Refiners' Oil Company, Limited, Carter vs., 164, 446. Production restricted, 72; in Ohio, 107; at Oil City and Titusville, 143 ; by shut-down of 1887, 153, 157; cheap- ness of, 217, 429, 445. Profits of natural -gas company, at To- ledo, 362. Property, "is monopoly," 37; of the combinations, 513. Prosperity, early, in oil regions, 42, 43. Public powers and property, private use of, 523. Publication of railroad tariff, how evad- ed, 230. Punishment nominal, 292. QcALiiy, deterioration of, under monop- oly, 405-19 ; of oil in Germany, 438. Quinby, District Attorney, 247-98. Railroads, northwestern, combination with elevators, 5 ; buying bitumi- 558 INDEX D0U3 coal lands, 11 ; baying iron and timber lands, 12; refuse cars to in- dependent coal shippers, 12; crush- ing independent coal producers, 13 ; nionopohze anthracite coal, 11, 14; raise freights to prevent settlement of coal strilie, 1871, 16 ; forbidden in Pennsylvania to own or operate coal- mines, 18 ; disregard Interstate Com- merce Commission's decision on coal rates, 19; and elevators com- bined in Minnesota, 31 ; northwest- ern, coerce grain buyers, 31 ; north- western, fix the price of wheat, 31 ; give discriminating rates to dressed- beef men, 36 ; contract with South Improvement Company, 45 ; contract to overcome competition for preferred shippers, 48 ; as detectives, 48 ; ad- vance freight rates on oil 100 per cent., 50 ; grant special privileges to railroau directors, 54 ; lobbying at Harrisburg, 65 ; rebates to oil com- bination, 69 ; facilities controlled by oil combination, 76 ; carry crude oil to Cleveland for preferred shippers without charge, 85 ; force Cleveland refiners into unnatural equality, 86 ; how they equalize per- sons and places, 86 ; make war on Pennsylvania Railroad for oil combi- nation, 87; of New York received $40,000,000 of public cash, 97 ; trib- ute paid by, to American Transfer Company, 99 ; pay American Trans- fer Company on oil not handled by it, 100 ; officials members of American Transfer Company, 100; oil terminal facilities transferred to oil combina- tion, 101 ; fight Tidewater Pipe Line for the oil combination, 108 ; lose 810,000,000 in war against Tidewa- ter Pipe Line, 109 ; will not tell how low rates were made against Tidewa. ter Pipe Line, 109 ; give use of their lands to pipe lines of oil combina- tion, 116; give oil combination money to build pipe lines, 116, 118; pool with pipe lines of the oil trust, 118 ; officials drive business from railroads to competing pipe line, 119, 134; broken pledges of, to independent re- finers, 119; pool with pipe lines, 121 ; make war on barrel-shippers, 129, 132; carry tank-cars free, 131; in- crease freight rate on barrels, 131, 132; increase freight rates at in- stance of the oil combination, 132 ; raise freights without legal notice, 136, 218; vary rates according to destination beyond their lines, 137 ; mistakes not corrected, 138 ; destroy barrel shipments, 138; promises of reparation unfulfilled, 139; make rates that prohibit traffic, 139 ; sur- render terminals to oil combination, 140, 142 ; relations with oil trust col- lusive, 143 ; litigation before Inter- state Commerce Commission prompt- ed by oil combination, 144; disobey Interstate Commerce Commission's decision, 149, 218; oppose new inde- pendent pipe lino to seaboard, 160; give use of lands to pipe lines of the oil trust, 162; officials wasting stock- holders' money in hopeless litigation, 163 ; force Joshua Merrill out of busi- ness, 189 ; consult with oil combina- tion about raising rates against inde- pendents, 200 ; make rates that pro- hibit trafiic at Marietta, 201, 203 ; refuse rates to Marietta refiners, 202 ; officials refuse to testify in Ohio in 1879, 202; increase rates 333 per cent, to one shipper, 217; deny dis- crimination, 218; make their favor- ites " sole people," 219 ; consult with preferred shippers as to freight rates to competitors, 219; refuse to answer letters of shippers, 220, 227 ; charge more for the shorter hauls, 221, 222, 223 ; " mistakes " for fa- vored shippers, 223, 234 ; officials re- fuse to testify before Congress, 224 ; " illegal " refusal to give rates, 224, 227 ; refuse to answer questions about tank-car rates, 228 ; make charges regardless of quantity for preferred INDEX 559 shippers, 229 ; haul tank-cars free for preferred shippers, !229 ; evasions of the law regarding publication of tar- iffs, 230 ; misstate tanli - car rates to shippers, 230 ; make rates to pre- ferred shippers " astonishingly low," 282 ; refuse to give rates, 233 ; pay preferred shippers mileage, 233 ; con- ceal mileage from independent ship- pers, 233 ; give Standard Oil Compa- ny 25 cents out of 35 cents freight paid by George Eice, 206 ; allegiance to the company, 203 ; construction aided by Toledo, 313 ; Commission of 18V3, in Great Britain, 369 ; regula- tion, Duke of Wellington on, 369 ; and Constitution of New York of 1846, 370; British, A. T. Hadley on, 370 ; New Tork Commission of \Wl, 870 ; procure abolition of New York Railway Commission of 1857, 371 ; State commissions to regulate, 371 ; officials refuse to answer questions of Congress, 373 ; prevent shipment of Colorado oil to Pacific states, 427 ; no discrimination on German, 438 ; Pennsylvania Constitution on, 451 ; lose the oil business worth $30,000,- 000 a year, 466 ; ownership of mem- bers of oil trust in, 460, 461 ; rates to oil combination secret, 474 ; prefer- ences to oil combination described by the Interstate Commerce Commission, 478 ; officials admit rebates, 480 ; shut off shipments of Colorado and Wyoming oil, 481; collusive litiga- tion between Southern Pacific Rail- road and oil combination, 483; of- ficials cliarged with receiving a bonus for giving rebates, 486 ; officials own- ers of stock in Chicago Union Stock- yards, 487 ; tax the poor for the rich, 489; give $50,000,000 to §100,000,000 rebates out of $800,000,000 freights yearly, 491 ; excuses for violating Inter- state Commerce law, 498 ; accidents to employ 6s, 499; rights of em ployes, 506. Ramsdell, Homer, on South Improve- ment Company contract, 50. Reading Railroad and railroad war of 1877, 88. Rebates, to South Improvement Com- pany, 46 ; equal to 21 per cent, a year on capital, 69 ; Ohio Supreme Court decision on, 69; to the oil combination, 69, 474-87 ; denied by president of tlie oil combination, 96 ; to Standard Oil Company, 96, 206; to American Transfer Company, 100 ; from railroads build pipe lines for oil combination, 116, 118 ; to oil com- bination admitted, 188; unknown to outside shippers, 475 ; giving or re- ceiving, a penitentiary offence, 475 ; denied by members of the oil trust, 476 ; to oil combination, summary of evidence of, 479 ; admitted by offi- cials of the Pacific railways, 480 ; to A. T. Stewart & Co., 489; given by Pennsylvania Railroad to three coal-dealers, 490; refusal of givers and takers to testify in Chicago, 490 ; $60,000,000 to §100,000,000 a j-ear, 491. Refineries, petroleum, dismantling of, 42 ; oil, put under contract to limit production, 61, 66 ; shut down and pulled down, 71. Refiners, compelled to sell to South Im- provement Company, 61 ; put under bonds not to refine, 79 ; New York, do not dare to build large refineries, 107. Refuse oil delivered to competitors, 291. Reichenbach on petroleum, 38. Reports by subordinate companies of oil trust, 274. Republican party and sugar trust, 404. Restriction, of competing refineries by oil combination, 61 ; of its ca- pacity to one -halt by the oil com- bination, 68 ; of production, by oil combination, 421 ; in Scotland, 435. Rice, George, 199-242; lets Interstate Commerce Commission cases go by default, 151 ; vs. Brundred et al., 239 ; cases before Interstate Commerce Commission, 239 n.; vs. Standard Oil 560 INDEX Tnist, 241 ; vs. trustees of Standard Oil Trust, 453. Rice, Kobinson, and Witlierop case, 1890, before Interstate Commerce Commission, 147. Richardson vs. Buhl el al, 10. River, interference with shipments by, 224 ; .shipments stopped by oil com- bination, 433 ; trade in Germany ap- propriated by oil trust, 437. Rochester, explosion in Vacuum refin- ery, 250, 252. Rosebery, Lord, comments of Investors^ Review, 450. Rothschilds, position in Russian oil in- dustry, 443. Ruftner Brothers, 462. Russia, American oil combination in, 442 ; every producer allowed to en- ter international trust, 444 ; Minister of Finance organizes combination with American oil trust, 444 ; why government of, favored American oil combination, 448; treaty with, 448. Rutter circular, 85. Salt, 32. Sanford case, Pennsylvania Supreme Court, 54. Scandinavia, 437. Scarcity, the object of oil combination, 72; Oil City and Titusville refineries kept closed, 142. Scliemk, U. P., libel against the, 225. Scofield, Representative, resolution for investigation of South Improvement Company, 56; W. C, Standard Oil Company I's., 61, 89; decision, 66; et al. vs. Lake Shore and Michigan Southern Railway Comp-my, 70. Scotch refiners in 1850, 39; pool of, 72 ; make superior article, 408 ; pre- cluded from discussing poor quality of American oil, 409 ; pool with Amer- icans broken in 1892, 427 ; pool with American combination, 435 ; com- pelled to reduce production, 435 ; shrinkage of capital, 436. Scott, Thomas, on South Improvement Company contract, 50. Screw, turn another, 213. Seaboard,Tidewater, first pipe line to, 107. Seamen, American, not employed by American subsidized steamers, 400. Secrecy, insisted on by oil combination, 63, 66, 79 ; in the increase of freights, 218, 474 ; as to ownership of oil-trust stock, 487. Secretary, of oil combination, testifies before Ohio Legislature, 61 ; testifies to " scarcely any profits," 67 ; testi- fies to purchase of oil plant of Penn- sylvania Railroad, 89 ; not a practical oil-man, 465 ; refused to give Congress names of owners of certain shares in its pipe lines, 487. Seemann, E. F., Die Monopolisiiimg des Petroleum Haiidels wid der Petroleum IndxiStrie, 438. Selligue, 38, 462. Senate, United States, the Payne scan- dal, 374-88. Sharpless vs. Philadelphia, 315. Shrouds, combination, 37. " Shut-down," of 1 887, 72, 153 ; advances prices of kerosene, 158. Silliman, Professor Benjamin, analyzes petroleum, 39 ; ou oil not monopolized, 40. Slave-trade, 525. Smith, Adam, 494. Socrates, the great are the bad, 506. South Improvement Company, investi- gated by Congress, 43, 45 ; investiga- tion suppressed, 45 ; contract of rail- roads with, 45 ; rebates, 46 ; and oil combination, same, 49 ; to have com- plete monopoly, 49 ; compels refiners to sell to it, 51 ; contracts not can- celled, 57 ; charter repealed, 57 ; ar- rangement still exists "in reality," 58; President of Standard Oil Company on, 59 ; plan of, reproduced, 85 ; re- appears in American Transfer Com- pany, 100; espionage in operation in 1880, 213 ; charged to be now in oper- ation in California, 479. INDEX 561 Soutb, oil combination not popular in the, 209. Southern Pacific Railroad Company and Whittier, Fuller & Co., Standard Oil Company vs., 484. Speculation, in sugar -trust stock, 82, 403 ; in oil, 42 ; by oil combination, on advance knowledge of freight re- duction, 1 10 ; follows " shut-down" of 1887, 157. Spies, 66; watch shipments, 212; pay of, 298 ; in war on Toledo, 334. Standard Oil Company, interview with president of, concerning South Im- provement Company, 59 ; president of, testifies about Southern Improve- ment Company, 59 ; vs. W. C. Scofield et al., 61, 89 ; decision, 65 ; contract with Lake Shore road decided to be "unlawful," TO; Supreme Court of Ohio on its monopoly, 70 ; and war of rates, 1877, 68 ; contracts for re- bate of one-tenth of all oil freights, 89 ; lower rates by Pennsylvania Kail- road to, 90, 94; freight rate of 38 cents to, 95 ; Erie contract with, 102 ; independents forced to sell to, 141 ; tax Investigation, by Pennsylvania Legislature, 166 ; members of, in- dicted in Clarion Countj', Pennsyl- vania, 170; saved from trial by Su- preme Court, 180 ; members of, object to taking witness-stand, 171 ; Peo- ple of Ohio vs., 239; sued by To- ledo for $1,000,000 damages, 367; spends money in elections, 386 ; Sena- tor Payne on the, 386; pays State inspectors, 414; owned by Standard Oil Trust, 458 ; its president denies ownership by Standard Oil Trust, 458 ; application to Attorney-General of New York for forfeiture of char- ter of, 458 ; vs. Southern Pacific Rail- road and Whittier, Fuller & Co., 484. Standard Oil Tru5t, purchase of works of widow competitor by three trus- tees of, 80 ; dissolution of, 240 ; Rice vs., 241 ; and the Buffalo explosion, 253-98 ; not a manufacturing corn- So pany, 272 ; members of, ordered ac- quitted by the judge, 272-84 ; trustees personally own majority of each com- pany in, 273, 468 ; controls every movement of suboivdinate companies, 274 ; how it pools the control and profits of subordinate companies, 275; owns natural -gas companies, 837; counsel of, is president of the New York Constitutional Convention^ 462; declared void by Supreme Court of New York, 453 ; People of Ohio vs., 453 ; Rice vs. Trustees of, 463 ; Su- preme Court of Ohio pronounces it a monopoly, and void, 453 ; New York L^islature on formidable money power of, 457; dividends, 457; capi- tal of, worth $148,000,000 in 1888, 467; Interstate Commerce Commis- sion on immense power of, 458 ; keeps no books, 469 ; operations not business, 470 ; makes president its attorney, 470 ; executes large con- tracts through attorneys, 470 ; asks Congress to hear additional defence, 471 ; discrepancy between the facts and its evidence, 471 ; claims same rebates were granted to other ship- pers, 472 ; its offer to prove to Con- gress that C. B. Matthews testified falsely, 472 ; its employment of de- tectives admitted by latter, 472 ; its threats of litigation against competi^ tors, 473; member of, denies rebates, 478. Steamsliip, discrimination in favor of meat combination, 37 ; pool, 395. Sterne, Simon, on oil terminals of Erie Railroad, 102 ; on railroads taxing poor for the rich, 489. Stewart, A. T., & Co., rebate to, 489. St. Louis, forty reductions in oil prices in three years, 427. Stock watering in natural -gas com- panies at Toledo, 363. Stock Yards, Chicago, Union, 34. Storage, ordinances for, used to over- come competition, 215. Storer, F. H., on Selligue, 38. 562 INDEX Stoves, 9 ; Manufacturers, National As- sociation, 10. Street - railways, Brooklyn, consolida- tion, 5. Strike of New York freight-handlers, 1882, 296. Subsidy, urged by Secretary of the Navy, 389; voted by Congressmen of both parties, 389 ; postal, 389^00 ; press used to popularize, 392 ; policy of limitations, 393 ; got by bribery, 394 ; advocated by United States Commis- sioner of Navigation, 40]. Sugar trust. Judge Barrett's decision, 3, 4 ; investigation by New York Legis- lature, 32, 33 ; capital and dividends, 32, 33, 404; contributes to Repub- lican and Democratic parties, 403 ; president testifies about campaign con- tributions, 403 ; securities and profits, 404 ; and government, 404 ; and anti- trust law, 404 ; president admits it has increased price, 431 n. ; and tariS bill of 1894, 449. Sumatra, 441. Sun, New York, on income of members of oil trust, 459. Suppression, of congressional investiga- tion, 1872, 45, 60; 1876, 71; evi- dence in Cleveland, 83. Supreme Court of Ohio, decision on rebates, 69 ; of Pennsylvania, inter- feres to save members of Standard Oil Company from trial, 180 ; said to be run by Pennsylvania Railroad, 181 ; of New York, on Standard Oil Trust, 453. Survival of the uufittest, 14. TiXE-BOATS for canal, 96. Tank-ears, origin of, 41 ; carried free by railroads, 131 ; less profitable to railroads than barrels, 13S; free car- riage of 62 gallons in each, 139 ; worse than powder, 139; prohibitory discrimination against competitors', 1S9; independent shippers cannot get rates, 228 ; of preferred shippers, hauled free by railroads^ 229 ; num- bers painted out, 23a, Tank -steamers, German, refused oil, 437. Tariif, changes in Germany, 437 ; low- ered in France, 440 ; and sugar trust, 404, 449 ; and trusts, John De Witt Warner on, 449. Taxes, oil combination refuses to pay, in Pennsylvania, 166. Terminal facilities, of railroads, con- trolled by oil combination, 102 ; sur- rendered by railroads to oil combina- tion, 140, 142. Testimony, in Cleveland case disappears, 83 ; mutilated transcript for Con- gress of Buffalo explosion case, 244, 267, 298 ; taken in Congressional in- vestigation of 1876 stolen, 373. Thurman, Allen G., on the election of Senator Payne, 376. Tidewater Pipe Line, organized, 107 ; rate of 10 cents per barrel made by railroads against, 108; plugged, 111; surrenders to the oil combination, 112. Timber lands, railroads buying, 12. Titusville fire, June 5, 1892,417. Titusville and Oil City Independent Refiners' Associations vs. Pennsyl- vania Railroad et al., 118-65. Toledo, Findlay and Springfield Railway vs. Oliio Oil Company, 306. Toledo, war upon, 305-68 ; undertakes municipal supply of natural gas, 307 ; municipal aid to railroads, 313; Peo- ple of Ohio vs., 314 ; Fellows et al. vs., 314 ; part of the oil combination in the war against, admitted, 339 ; city natui'al - gas line, financial results, 359-68 ; public enterprise builds bet- ter pipe line than private; 360 ; gas shut off, 366 ; brings suit against Standard Oil Company and others for $1,000,000 damages, 367. Treasurer, of oil combination, denies purchase of oil plant of Pennsylvania Railroad, 89. Treasury, Secretary of United States, business associate of oil combination, 400; orders it paid drawbacks, 401; INDEX 563 Commissioner of Navigation, advo- cates subsidies, 401. Truesdale, George, testimony of, 246. Trust, anti, law, 3, 7, 404 ; oil combina- tion, parent of system of, 8 ; in poli- tics, 403 ; all contribute to campaign expenses, 403 ; prices, 429 ; prices of, superior to panic, 431 n. ; and tariff, 449. Turpentine, rates on, 232. Undertakers combination, 37. United Pipe Lines, buy bankrupt pipe lines, 87 ; owned by oil combination, 101, 125. United States, vs. E. C. Knight & Co. et al., 404 ; marshal libels river steam- ers, 225. United States Pipe Line forced to aban- . don Hancock route, 163; makes suc- cess of piping refined oil, 165 ; oppo- sition to extension beyond Wilkes- barre, 445. Uprising in the oil regions, 1872, 65. Vanderbilt, Commodore Cornelius, wealth of, at 44, 460 ; William H., on South Improvement Company con- tract, 51 ; .surprised by ready cash of oil combination, 88 ; never heard of American Transfer Company, 99 n. Van Syckel, Samuel, lays first pipe line, 41, 185; history and inventions of, 182-98 ; vs. Acme Oil Company, 187 ; gets United States patents for new process of refining, 193 ; given 6 cents damages by the judge, 195 ; dies in poverty, 462. Wagoss cheaper than railroads, 211. Warner, A. J., on bill to regulate river shipments, 225. Warner, John De Witt, on trusts and teriff, 449. Washington, Constitution concerning trusts, 451. Wealth, concentrated, greatest sov- ereign, 134 ; of the combinations, certain features of, 513. Webster, Daniel, on extemporaneous acquisition, 462. Weehawken oil docks, 140. Well-drillers' Union and the " shut- down" of 1887, 154. Wellington, Duke of, on State and railroads, 369. Whalebacks, 460. Whiskey, ring of 1874, 20; trust, sec- retary of, arrested, 21. Widow, competitor of oil combination, 75 ; forced to sell, 77. Wilkesbarre railroads oppose inde- pendent pipe-line crossing, 161. Wilson, William L., on sugar trust, 32 ; President Cleveland to, 404. Witnesses, before United States Sen- ate Committee investigating Chicago meat combination intimidated, 34 ; before committee of Congress re- fuse to testify, 60; refuse to ap- pear before Interstate Commerce Com- mission, 145 ; railroad officials refuse to testify in Ohio, 202 ; railroad, re- fuse to testify before Congress, 224 ; coached, 279. Woman refiner, 73. Working-men, thrown out of work, 54, 68, 135, 154, 159, 455; punished for boycott, 287 ; of Toledo support city natural-gas pipe line, 308 ; in Toledo subscribe for city gas bonds, 340 ; reduction of wages in Scotland, 430 ; decline of w.-iges in oil regions, 456. World, New York, on Russian Extra- dition Treaty, 448. Wright, Henry C, discussion on slav- ery, 346. Wyoming oil, railroads prevent ship- ments of, 481. TocxG, T. Graham, on British oil test, 409. By the Same Author A STBIKE OF MILLIONAIRES AGAINST MINEKS OK, THE Stoey of Spring Valley AN OPEN LETTER TO THE MILLIONAIRES Notices by the Press The Springfield (Mass.) Republican (editorial). Those -who keep note of passing events will not Lave forgotten the lock- out of coal miners at Spring Valley, Illinois, in the early months of 1889, and the sufferings of the families of the workmen in consequence. This sad story of corporate inhumanity has been effectively told by Henry D. Lloyd in a book entitled A Strike of Millionaires against Miners. It merits no less a volume than this. It is not an isolated case — an in- dustrial phenomenon springing from conditions rarely repealed — but one of many similar cases, a part only of the whole story of coal mining in the United States. More than this, it is an aggravated illustration of the soullessness of the corporation in general, through the agency of which the bulk of the producing powers of the nation is working. Behind this legal fiction men hide and do deeds of grasping cruelt3' that disgrace manhood, and are fast bringing the industrial organism into con- tempt. In the case of Spring Valley, the directors and stockholders of the Chicago and North-Western Railroad and the Spring Valley Coal Com- pany — controlled by the same men — are as responsible for the sufferings and death from starvation of miners in Spring Valley in 1889 as if they had all been personally present and assisted in the business of bringing men from a distance to work in their mines on assurance of steady cmplo3'- ii A STRIKE OF MILLIONAIRES AGAINST MINERS ment, and then of locking Uiem out without warning;, to starve them into submission to lower wages, for the sake of higher jirofits on their stock. This is the conclusion of Mr. Lloj'd, and we see no escape from it. If the corporation is to be considered an impersonality witliout moral responsibility, it -will either have to go, or the industrial system which makes it an essential part will have to go. All the power of government, or wealth, or vested interests cannot maintain that system which, resting as our present system must on the charitable instincts of men, offers a way of escape from the responsibilities imposed thereby to the most powerful factors of the society. Against that system "the pulses of men will beat until they beat it down." What must be the condition of that society which allows the wealthy capitalists who starved these thousands of miners not only to go unpunished, but to move in the very highest circles of busi- ness power and social influence ? And one of them in particular is to-day figuring upon representing the Democratic party of Pennsj'lvania in the United States Senate. The New York Comviercial Advertiser (editorial). It is to be remembered that Mr. Lloyd's hook does not profess to be a dispassionate review of the situation. It is an indictment. The corpora- tion's side should be given a fair hearing. But it must be heard soon. Mr. Lloyd's charges are too important, his formulation of them too worthy of respect to be treated with silent contempt. To ignore them is to confess their truth. Should such a reply be made, the readers of this column will be informed of it. A Strike of Millionaire against Miners describes the poverty, the suffering, the utter misery among the miners in Spring Vallej', Illinois, during the past year. In the simplicity and restraint of his stj'le, and in the massing of his facts, Mr. Lloj'd shows genuine literary power. There is no attempt at rhetoric in his narrative. He depends upon state- ments of facts, many of them incontrovertible, to rouse the hot indignation of his readers. If the story is true, and it bears every appearance of truth, the Spring Valley mine owners have been guilty of damnable treachery and cruelty to their fellow-men. Chicago Herald (editorial). The Herald commends to the attention of its readers the open letter in another column, from Henry D. Lloj-d, addressed to various millionaires of New York, Chicago, and St. Paul. It contains what the Herald believes to be the truth as to the Spring Valley scandal, and while in most respects it is a plain statement of facts, it is nevertheless one of the most powerful appeals for justice, and one of the most eloquent denunciations of wrong, which has come under the public eye in many a daj-. Mr. Lloj'd's high character, liis superb attainments, and his well-known philanthropj' give force to the arraignment it might not otherwise possess. His letter is a history of a crime — a crime resulting, no doubt, from' an in- famous conspiracy — and the story leads naturally and .inevitably to the XOTICES SY THE PUESS iil conclusion wliicli Mr. Lloyd avows, that there must be conspiracy laws for millionaires as well as for workingmen. Civilization must be bottomed on justice, or it cannot endure. A society which permits such inhuman outrages as that at Spring Valley is either asleep or in an advanced stage of decay. The money god cannot crush out the lives of human beings with impunity. Let its devotees look well to the ground on which they stand. The wise and humane will be warned in time. The foolish and insatiate must be left to the stern judgment of their fellow-men, who must some day pass upon their act. The Labor World, London, England. What does Mr. Andrew Carnegie, who chants vulgar paeans to "Tri- umphant Democracy " say to such a book as this of Mr. Lloyd ? This story of the robbery and betrayal of thousands of working miners in Il- linois by a great millionaire corporation is one of the worst things we have read for a long time, and is a terribly scathing satire on American "democracy." Let us hear no more trash about " free " America as compared with down-trodden Europe. Both continents are downtrodden by the rich men who own the raw material out of which wealth is created by human labor. When the land of the United States is all absorbed by private persons, as it will be in twenty years' time, there will not be a pin to choose between America and Europe, so far as wage- workers are concerned. Wages may be higher in America, but the increased cost of living there will nearly equalize the condition of the two continents; wliile for swindling, lying, and merciless oppression many American capitalists leave their European brethren far behind. Mr. Lloyd's book, which is the first of a new " Bad Wealth Series," ought to open men's eyes to tlie fact that true freedom is impossible when a few men have a right to appropriate to themselves the raw material of tlie globe. Chicago Daily Inter-Ocean. Mr. Lloyd's reputation as a writer on economic questions is sustained in the manner of handling tlie usually dry statistical matter which tells the story of strikes and lock-outs. He makes the story interesting and often graphic, while he gives tlie facts and figures relating to the intricacy of contracts in a way to be easily understood by the ordinary reader. The book is a valuable compilation of the facts gathered relating to this shame- less abuse of corporative power in Spring Valley. The New Ideal. Mr. Lloyd has been until recently on tlie editorial staff of the Chicago Tribune, and is now devoting his time to first-hand investigations into labor troubles. This book gives an account of a Jock-out in one of the mining districts of Illinois, and is the more forcible and eloquent an ar- raionment of the "millionaires," as the statements are throughout verifi- iv A STRIKE OF MILLIONAIRES AGAINST MINERS able. As Mr. Lloyd in eflPect says, professors of political economy do not come near enough to realities to discover such details as he portrays, and the workingmen do not know how to bring them before public opinion. Hence the necessity of a mediator, who shall thoroughly investigate the facts and at the same time give them to the public, not in statistical re- ports, but in a form that compels its attention. Mr. Lloyd is a practised ■writer; no one can read this narrative without being profoundly moved, and for the directors and stockholders of the Spring Valley Coal Company (and, besides, of the Chicago and North - Western Railway, an aider and abettor of the nefarious business) the effect must be to set their blood on fire — so far as they are blessed (or unblessed) with any moral sensitiveness. Every tho\ightful citizen — whether man or woman — should read this book, and have fully brought home to him or her the problems it suggests. It belongs to the literature both of fact and of power. The MeUgio-Philosophical Journal. Mr. Lloyd admits that Spring Valley and its miseries and wrongs were, at the beginning, but the conception and achievement of one or two of the leading owners of railroad and other companies who did the planning, secured the approval of the Board of Directors, and the active influence of the railroads through whom, by special freights, the business of competi- tors was stolen, coal land was bought, and the scheme was invented by which fortunes were to be made from workingmen's necessities and the misuse of the powers of the common carrier. But none of the directors, none of the stockholders, who received the profits of the scheme, protested against it; on the contrary, all accepted unprotestingly their "share of the guilt and gilt." Mr. Lloyd gives a mass of facts and figures which prove, on the part of corporations employing men at Spring Valley, an amount of greed and heartlessness which seems incredible in an enlight- ened countr}'. !Mr. Lloyd is a literary artist as well as a man of deep feeling, and lie combines felicity of diction with fervor and eloquence of expression, and writes with effectiveness and power. The book should be read by all who are interested in the labor question — the practical issue of the hour. Chicago Times. It is a pitiful story, a heart-breaking story, and Mr. Lloyd tells it with a great deal of force and earnestness. The Dawn. Can it be possible in these happier days among men who share the Christian civilization of the very eve of the twentieth century, that there can exist any analogy to this relentless war of savagery, this cruel and cowardly subjugation of a competitor, not in honest, open combat, but by taking advantage of a position to deny him food, shelter, and the very necessaries of life ? For an answer, such as would bring indignant emo- NOTICES BT TEE PSESS v tion to every heart not indurated by avarice of gold, and shame to every cheek not rendered incapable of blushing by hardened selfishness, we refer to the terrible facts, so calmly told with the severity of simple truth by Mr. Lloyd. Starved Rock and Spring Valley are not isolated instances. The malady is constitutional, not local. "The whole head is sick and the whole beart faint," may be said of our modern system of business. The Nationalist. In this age of strikes it is not always the workers who strike, as is in- dicated by the title of Mr. Lloyd's book. That brilliant and great-hearted journalist and publicist several months ago, in the shape of an open letter of several columns, printed in the Chicago Herald, told the story of the criminal and cold-blooded conspiracy of a group of enormously rich men against a body of honest and industrious workingmen. That letter he lias made the basis of the present volume, which deserves a wide circulation among patriotic citizens of the United States. The strong and truthful words here uttered ought to ring throughout the land and arouse the peo- ple to a realizing sense of the greatest danger that has ever threatened our republic — the danger of its conversion into the worst of despotisms, that of rule by an irresponsible plutocracy. The Burlington Hawlceye. Mr. Lloyd proves every charge he makes, the testimony he brings for- ward being so presented as to leave no question as to its absolute correct- ness. In all the dark record of tyranny, cruelty, and brutality made by the coal barons of this country there is not a blacker chapter than that which tells of their crimes against the miners of Spring Valley in the year 1889. This is not the verdict of the "labor crank" alone; the people of Chicago and the whole of northern Illinois, in the press and pulpit and on the platform, have denounced the outrage, and the cooler Judgment of to- day, when the lock-out is about worn out and the majority of the old miners are scattered all over the country, is in accord witli the denunciation made by Mr. Lloyd. The Rock Islander, Rock Island, 111. A Strike of Millionaires against Miners, or tlie Story of Spring Valley. The above is the title of a beautifully printed volume of 264 pages, by Henry D. Lloyd. Its prelude is the story of the starved Indians of Starved Rock, and it proceeds to parallel tliat by the starvation of labor by the million- aires. The story of Spring Valley is given in detail, with ofBcial proof of its truthfulness, and is graphically told by Mr. Lloyd. Its exposure of the oppressors of labor is terrific. It shows who they are; who has done this thing; how the town was boomed; how it was doomed; how the ghost o£ Starved Rock walks abroad ; and how people are bought and enslaved in this boasted free country. It gives Governor Fifer a deserved slap for not VI A STRIKE OF MILLIONAIRES AGAINST MINEItS going in person to the scene of starvation, and it roasts his military toady of tlie rich (Adjutant-General Vance) who was sent there by the governor to investigate, and whose report is proven to be a tissue of sneers at the poor, and falsehoods in regard to them and their situation. He quotes freely and approvingly from the report of Judge Gould and Mr. Wines, proving all that was claimed for the suffering there. He shows (page 66) that the Chicago, Jlilwaukee and St. Paul Railroad Company generously acknowl- edged the necessity for help by hiring a physician for its miners at Brace- ville, and sending supplies of necessaries for sick women and children to be given out by its agent there. He shows up the campaign of slander against Spring Valley, which was carried on through capitalistic news- papers and corporation tools ; says the Spring Valley case is only a pre- liminary skirmish of capital against labor, and, after showing the first fruits, asks what the last will be. He closes with a chapter giving part of the moral. An appendix is added, showing what the millionaires said of themselves, and the replies by the miners and the press. Everybody should read this most remarkable and ably prepared story of the crime of capital upon labor. Seed-Time (Jjondon), tlie organ of the New Fellowship. Perhaps the most striking of all the American object-lessons on the tendencies of capitalism has been given us by Jlr. Henry D. Lloyd, of Chicago, who has recently published a book entitled, A Strike of Million- aires against Miners, or tlie Story of Spring Valley. A more complete ex- Ijosure of the tyranny and cruelty of capitalism has never before been made. Its great importance for us, however, lies in the fact that all the tyranny and wrong he witnessed and describes are but the natural outcomes of the principles of commercialism when those principles are carried to their logical conclusion, and capitalism has unchecked swaj'. Such terrible scenes do not occur everywhere, simply because capitalism is held in check by other social forces, and has not everywhere attained that full and un- fettered development which discloses the evils which in its more unde- veloped stage lie concealed. The Twentieth Century. It is a mind -agitating and heart-rending tale, aud unless I am much mistaken the publication of it will create an epoch in economic thinking and social regeneration. What is the remedy for such crimes as 3Ir. Llo3-d has exposed? The remedy will be found if open-minded persons will read such books as Mr. Lloyd's, and keep themselves informed as to what is being done to reduce a people to servitude. This single book ought to pro- duce such a revulsion of feeling against the monstrous millionaires who perpetrated this awful crime that they would be looked upon by all decent people with abhorrence. If you will read Mr. Lloyd's book I think you will agree with me that if before long, as many persons believe, this country is to be deluged in the NOTICES BY THE FHESS vii blood of revolution, the catastrophe will be brought on by condoning such crimes as that at Spring Valley ; it •will be brought on because you and I read such stories as this, and, knowing they are true, straightway forget all about them ; it will be brought on because editors and preachers, and others who have the public ear, keep silent through negligence or fear of the rich who misrule the land. If people will not think, if they will not care, you may depend upon it that the price of their indifference will be slavery or war. From a letter to the Twentieth Century. Your article, and the extracts from Mr. Lloyd's book in your issue of June 13, portraying the outrageous injustice inflicted on the Spring Valley coal miners by ihe i-ailway and coal-mining barons, was read before our club by Judge Frank T. Reid, of this city, a member of the club, at its reg- ular weekly meeting, Monday, June 23. A resolution was unanimously passed and sent to the General Executive Board of the Nationalist clubs at Boston, requesting it to get up a memorial to the Government Bureau of Labor, petitioning that body to institute a special inquiry into the out- rages; that this be done with a view of publishing these crimes to the whole country, under the proper authority, and also with the view of memorializ- ing Congress for the government to work either all or part of the coal- mining industry on the same principle that it works the postal service, the government priuting-ofHce at Washington, and other industries, as the present method of running the coal mines by corporations has resulted, and will continue to result, in rioting and bloodshed, and imperils the very existence of society. "We would suggest that copies of the memorial be sent to all the Nationalist clubs for signatures, and also to the Federated trades. Knights of Labor, and other organized bodies and to individuals. Might we also suggest that you kindly communicate with the Executive Board of Boston , and with our worthy and earnest brothers, Messrs. Bellamy, Bliss, and others? Yours fraternally, J. L. JOHKSON, Taoo-ma, Wash. Secretary ^nationalist Club, The Open Court. The story of Spring Valley will make every American citizen of healthy morals uncomfortable and ashamed. ... A story which must be read, and the lesson of it heeded, or worse things come. The St. Louis Sejyublic. A stirring account of the great mining strike, lock-out, and consequent misery at Spring Valley, Illinois, in 1888-89, the main features of which are still familiar to the reading public. Mr. Lloj'd lays the blame where it belongs, and shows how the whole transaction worked to the profit of the plutocrats at the expense of their dupes — the enterprising thousands who vlll A STRIKE OF MILLIONAIKES AGAINST MINERS believed in the promises made in booming the location. The booming of the town was followed by tlie dooming, and, as tlie Republic and many other papers sliowed at the time, the action of the mine operators all through was "a cruel abuse of intellectual strength to use it to force weak- ness and ignorance into such a condition of helplessness." The author gives facts and figures, and his account of the matter is borne out by the news columns of the times. It is a sad story, and its truthfulness is a shameful comment upon the tendencies of our day. The Pittsburg Labor Tribune. A Strike of Millionaires against Miners, or the Story of Spring Valley, is a liandsome edition of the important matter written by Henry D. Lloyd when the notable strike was on at the mines located at Spring Valley, Il- linois. Our miner readers especially will read with satisfaction the vim and ability with which Mr. Lloyd handles the literary end of that eventful pe- riod, and will be pleased to know that he has issued the matter in consecu- tive form. The Democrat (London). Bad as the social and industrial condition of Great Britain is, that of the United States threatens to become as bad or even worse unless the power of landlordism there is subjected to popular control. A striking instance of the rapid growth of monopoly and its ruinous effect on industry, as well as its atrocious tyranny over labor, is recorded in a striking little book by Mr. Henry D. Lloyd, of Chicago, called A Strike of Millionaires against Miners. Rights of Labor (Chicago). This narrative of the rapacity and greed of our coal barons we most earnestly commend to all our readers as a plain, clear statement of facts, admirably put; it deserves the widest circulation. New York Herald. This is one of the saddest, most enraging stories ever put on paper; of course the corporations protested, as corporations always do in such cases, that they were not to blame, but the awful facts cannot be denied or ex- plained away. The Herald expressed its mind editorially at the time. Now that the whole case is presented, the Herald's readers can see how easily a scheming gang of heartless scoundrels can quickly reduce thousands of families to a condition worse than old-fashioned African slavery. Tacoma (Washington) Globe. Among the many books recently published on the labor question and the relations between the rich and the poor, none has excited a deeper interest than A Strike of Millionaires against Miners. Before the atrocities perpe- trated in Spring Valley by the coal mining company, composed of some NOTICES BT THE PRESS ix of the -wealthiest men in the United States, the wrongs inflicted on the peasants in Ireland fade into insignificance. Tliis book should have a ■wide reading, that all may know whither the nation is drifting. Boston Herald. The story of the labor disturbances at Spring Valley, Illinois, caused by a shut-down of the mines in 1888, is told by H. D. Lloyd in a thrilling pres- entation. In perusing the whole history, from the first alluring advertise- ments of the mining companies to the editorial comments in Chicago papers after the lock-out took place, a dweller in happier laboring regions will hardly believe that so much injustice could have been done in free America. The Worker (Brisbane, Queensland). A simple but complete account of a terrible injustice. The Christian Union. Six or eight years ago there appeared in the North American Beziew an article entitled "The Lords of Industry," by Henry D. Lloyd, which set forth with such power the nature and extent of the combinations to dimin- ish production and increase prices that its author may be said to have ini- tiated the anti-trust agitation of the last few years. Since that time he has gone on in the work thus begun, putting heart and soul into it. The Strike of Millionaires against Miners carries perhaps less weight with our intellects than Mr. Lloyd's earlier work, but it appeals so strongly to our hearts that we are carried with him through the volume, and share with him his indignation over the wrongs he describes. CoNooan, New Ilampshire, October 22, 1S92. Dear !Mb. Lloyd, — I am reading the Study you so kindly sent me. I have read most of it, including the " Word to Coal Miuers," and what a "study!" What a lesson 1 What an apocalypse! Tlirough it, " the voice of our brothers' blood cries to us from the ground," literally, and in tones scarcely ever heard before by human or heavenly ear ! Would that you could peal out all the seven thunders of Patmos. I wish j-our work might outsell in number Uncle Tom's Cabin, and Robert Elsmere combined, till its note filled the earth as the waters the seas. Print the whole of this hasty testimony over my name, if it will be of service to the working man and woman. Faithfully and fraternally yours, for every good thought, word, and ' Parker Pillsbuby. A BOOK FOR THE TIMES THE EAILWAYS AND THE REPUBLIC. By James F. Hudson. 8vo, Clotli, $2 00. The author studies carefully the evils of the system, inquires into the power of legislation to cure them, and describes the remedies -which will preserve the usefulness of the railways, and at the same time protect legitimate investors. — JV. Y'. Evening Post. It is seldom the public is given a work at once so timely, so brave, and so able Mr. Hudson writes with the most ex- haustive knowledge of his subject, and with an unusual ability in setting forth his ideas so that they are easily and clearly un- derstood. There is hardly a more vigorous chapter in modern literature than that in which he discusses the rise and growth, of the Standard Company. . . . The book is everywhere marked by unusual ability, accuracy, and fearlessness, which make it one of the most important contributions of the day to a subject which of necessity engages more and more attention every day. The political principles of the writer are thorouglily sound and practical. — Eoston Courier. The subject is of such vital importance that no man or woman in the country should be ignorant about it. — N. Y. Times. Ml-. Hudson writes in the interests of the people, calmly and without passion, as one who thoroughly understands his sub- ject, and in harmony with many others who have dealt with the same problems. — Critic, N. Y. Published by HARPER & BROTHERS, New York EF° Jbr sale by all booksellers, or mil. he sent Ixj the publishers, postage pre- paid, to any part of the United States, Canada, or Mexieo, on receipt of 2>rice.