A tl'J'n.HAU.l'A W O ^' -^ 4 o -1^ i * * r <3k 4 > t . - ^ o • I ,'^^ to fi * A ^^^%^ |/«^ .^ ^' .9 -^^ ,V .0^ ^- C-.,;. ^ <^. ^ &^<' rt»_ ^^ 4 r^^ ^5' . s * /\ A V tC 'm ,0 -V v. « s ,V V ^; ^* THE WRECK An Historical and a Critical Study of the Administrations of Theodore Roosevelt and of William Howard Taft BY HENRY CLAY HANSBROUGH NEW YORK THE NEALE PUBLISHING COMPANY 1913 Copyright, 1913, by The Neale Publishing Company 0'C!,A35 779 5 One of the Seven was wont to say that laws were like cob- webs; where the small flies were caught, and the great break through. — Bacon Oh, for a forty-parson power to chant Thy praise, Hypocrisy! Oh, for a hymn Loud as the virtues thou dost loudly vaunt, Not practice. — Byron Sire, it is worse than a crime, it is a blunder. — Joseph FoucM PREFACE WE plume ourselves upon our rapid advance in Civilization ; and yet no people ever retrograded po- litically as the American nation is retro- grading at this moment. In the name of Progress we are going back to Barbarism. I have reference to what must certainly fol- low when we have reached the limit in our present spasmodic spell of Wild-eyed Poli- tics, if limit there be. During the past dozen years politicians of all parties, each trying to outdo the other in proposals of a radical nature, have plied the arts of the Demagog with such success as completely to overthrow our earlier sys- tem of Government, and the cry is for still further achievements in irrational schemes of legislation. The fatuous thing known as ^^Pure De- 7 PREFACE mocracy," which always works its own de- struction, is now gripping the Republic to its death. In the end it will prove to be the handmaiden of devouring monopoly, that other deleterious force now all controlling in the country's business affairs. In The Wreck I have aimed to explain how it all came about, and to describe the methods of the leaders who are responsible for the catastrophe. H. C. H. Washington, D. C. August 1, 1913. 8 i. CONTENTS PART I PAGE The Rise of Radicalism 11 Ripening of the Trust 23 Roosevelt in the Saddle 42 Monopoly's Rapid Pace 70 The Moral Effect 86 The Political Results 95 PART II Four Years of Taft 115 Some Tariff Bungling 135 More Bad Politics 161 Taft and the Trusts 165 Mr. Wilson and His Party 174 PART I THE RISE OF RADICALISM THE WRECK PART I THE RISE OF RADICALISM WHEN in 1901 Theodore Roosevelt came into power, almost imme- diately two great dangers con- fronted the Republic,— first, the supremacy of Monopoly; and, second, a condition of endless Political Pandemonium. Both have come to pass. Under his fostering care they arrived quite promptly. The length of their stay depends entirely upon the time that will be required for the people to re- cover from the state of mental intoxication in which Roosevelt left them at the end of his despotic rule. The term ^^came into power" is fittingly 11 THE WRECK used, for Roosevelt was the whole Govern- ment, through methods which he at once proceeded to adopt, — methods unlike any the country had known before. His acces- sion to the Presidency was in consequence of a most regrettable tragedy, the first of a series of violent shocks which continued to the close of his demoralizing reign. There can be no doubt that the political excesses he brought about are the natural concomitant of the other forbidding thing, — the triumph of monopoly. The theory upon which this statement rests is thus ex- plained by Guizot: "The sovereignty of the people is a great force which some- times interferes to break up an inequality which has become excessive, or a power which has become absolute, when so- ciety can no longer accommodate itself to them; as despotism sometimes interferes, in the name of order, violently to re- store a society on the brink of dissolution. It is only a weapon of attack and destruction, never an instrument for the foundation of liberty. It is not a principle of government, it is a terrible but transient dictatorship, exercised by the multitude, — a dictatorship that ceases, and that ought to cease as soon as the multitude has accomplished its work of destruction." 12 THE RISE OF RADICALISM As has been suggested, the tragic death of William McKinley marked a change in American politics of far-reaching conse- quences. It was a change which together with its results the present historian feels quite free to discuss, even at the risk of re- flecting somewhat upon the party to whose principles, so often misapplied, he still ad- heres. Assuming the task with malice toward none, but rather with sympathy for those who, being human, have made their human mistakes, he is aware nevertheless that who- ever writes truthfullv of some remarkable events of the Twentieth Century's first dec- ade will not escape the accusation of per- sonal bias. To do even partial justice to the subject, one must have been a part of the intricate and greatly misunderstood government'^1 machinery at Washington, and to have known somewhat intimately the statesmen of the times. The turning point in the larger politics 13 THE WRECK of the nation dates back to the Philadelphia convention of 1900, when McKinley and Roosevelt were nominated as the Repub- lican candidates. It is claimed by some that the radical movement began with the appearance of Bryan as the leader of his party in 1896, but until recently the Democrats have had but little to do with federal affairs within the past sixteen years. And as for radicalism and its strange freaks the Republicans have been giving Bryan and his followers a few exhibitions well calculated to make the former advo- cates of free and unlimited coinage of silver slink away in confusion. By comparison it has been the difference between a primer lesson and a college course. Events of a thrilling nature followed rapidly the making of the Republican ticket in the Quaker city. It is matter of common knowledge that Senators Mark Hanna and Thomas C. Piatt were the dominant figures in the management of that convention. 14 THE EISE OF RADICALISM They belonged to the same wing of the party, — the Stalwart wing; yet they dis- agreed widely in regard to the complete ticket. Piatt favored Roosevelt for the vice-presidency; Hanna was bitterly op- posed to him. For a time there was every prospect of a permanent rupture between the two recognized leaders, and much mid- night electricity was consumed before peace was declared. In the matter of the party platform Hanna and Piatt were in close accord, and in this regard the delegates, for the most part, were of the same mind; for that was before the day of serious perplexities in the matter of party policy. Insurgency was then only in the bud. Leastwise it had not yet ripened into a formidable force. It is quite generally believed that Piatt demanded the nomination of Roosevelt for second place on the ticket in order to get rid of him as governor of New York, to which place he would have been renominated but for the final action taken at the Phila- 15 THE WRECK delpMa gathering. This belief, however, is not well founded. Piatt was a man who had had experience in polities, both national and state. He was a pastmaster in the game long before Hanna took his first local lessons in Ohio. Hanna 's success in nominating McKinley at St. Louis in 1896, when the country seemed ripe for ^^a change" and the way to Eepublican victory was easy, had made him boldly aggressive and somewhat dictatorial. If a thing did not suit Hanna personally, then it wasn't good for the country. He wanted McKinley for a second term above everything else. Piatt was not opposed to McKinley, although Hanna suspected that he was. The thing that Avas troubling Piatt was that he scented the danger of defeat. This was too remote a possibility to impress Hanna. Piatt entertained such fear of McKinley 's reelection that he was trying in every way to guard against mistakes. j He knew then what so many of us have learned since, — that a condition of pros- 16 THE RISE OF RADICALISM \ perity, even the semblance of itjNproduces among the people an atmosphere of arro- gance. It is this that has confounded so many politicians who, having made a strug- gle in behalf of a season of good times, re- turned home to find the harvesters planning to *^turn the rascals out," — *^the rascals'' always meaning the majority party. Only four years before when, for whatso- ever reason, the country was passing through a business depression and the Re- publicans, having become unusually numer- ous, were clamoring for a return to power, the people appeared to be in a very humble mood. Now, however, after a period of ap- parent fatness to the discerning eye the vast electorate seemed to be upon the verge of revolt. It was the tendency toward powerf vil busi- ness combinations, — that is, railroad and industrial consolidations, — and not the *' natural perversity of man" that made the people irritable, uneasy, and difficult to please. This was the psychology of the sit- 17 THE WEECK nation, and no one was quicker to feel its influence than was the ^^easy boss^' of New York. Such things, however, made no impres- sion upon Mark Hanna. To his mind the rapid increase and growth of trusts and combinations was positive evidence sustain- ing his own political wisdom, — a true in- dication of ideal national progress. A very considerable number of the dele- gates took the Piatt view of it; they were fresh from the people and knew what the voters were talking about. Apprehensive of party defeat they, along with the perspi- cacious Piatt, wanted a man for second place who would add strength to the ticket. Not that they questioned the ability or the Republicanism of McKinley, or were opposed to his renomination for any sub- stantial reason. He was an ideal candidate from many points of view; he had served the country and his party well and faith- fully. . Moreover, he was the kind of man who 18 I THE RISE OF RADICALISM won tlie admiration even of those who dis- agreed with his political principles. If he was afflicted with any human weakness it was that he had no enemies, — a reversal of the adage that a man is loved for the ene- mies he makes. As he himself subsequently said to Sena- tor Carter, of Montana: ''We appear to have pleased almost everyone. Our prom- ises have been carried out. Peace and plenty have returned to the land ; what more can we do ? Strange as it may seem, I am oppressed by the abundant happiness that has come to the country." Two weeks from the date of that utter- ance he was shot down at Buffalo. The pressure upon Senator Hanna was so great that he was compelled to yield ; not, however, until Senator Piatt had given him such positive assurance in regard to Colonel Roosevelt as to mollify the aggressiveness of the McKinley manager. The final scene between the two great party leaders re- mains a memorable one. 19 THE WRECK ^^Tom, you are an old fool," roared Hanna when Piatt, having been sent for late in the night, came into the Ohio sena- tor's room. ^^I know it, Mark,'' replied Piatt in his quiet wa}^; ^'but when you're as old as I am you'll not be as much of a boy as you are now." 11 *'That cowboy will ruin the country, continued Hanna. ^'Nothing can keep him out of the White House four years from now. Is that your game, for the Lord's saker' **Not for the Lord's sake, Mark," replied Piatt. *^I should hope not." *^But for the party's sake. Military heroes have always been popular, you know." And the New Yorker smiled faintlv. «/ ^^ Military hero!" exclaimed Hanna. ^^ You are as crazy as he is, more so, I guess, for you're old enough to know better." ^^But less dangerous, you think*? Now, 20 THE RISE OF RADICALISM Mark, I know him better than you do. He's not at all dangerous. ' ' The two leaders looked at each other. Their silence was akin to an explosion of eloquence. After a significant pause Hanna asked: Do you guarantee hini, Tom'?'' I'm not in the guarantee business, Mark, but I repeat what I said, — that he is not dangerous." There was another pause, during which Piatt's guarded guarantee seemed to pene- trate Hanna 's subconsciousness. *'Well," remarked Hanna, ^'have your own way; you'd better go to bed." This brief conversation, the climax to an intense struggle running through the two previous days and nights, took place at two o'clock of the morning of the convention; and a few hours later Theodore Roosevelt was nominated as the vice-presidential can- didate without opposition. Both elements in the party had been sat- isfied, — the conservatives with McKinley 21 THE WRECK and the radicals with Roosevelt. In the language of a western delegate who had been a member of a Rough Rider regiment, the campaign would ^^have some ginger in it'^ and the trusts would ^^have to sit up and take notice." Such was the confidence of the Roosevelt following thirteen years ago. There was no lack of ^^ ginger" in the campaign. 22 I EIPENING OF THE TRUST THOMAS COLLIER PLATT was peculiarly a political genius. His knowledge of men, which was ex- ceedingly good, was no greater than his knowledge in regard to what was required to hold ''the organization" together and re- new the life of the party as conditions arose. If he had what in political parlance is known as the ^^fine Italian hand," it was supported by a keen mind and a far-seeing eye. He knew instinctively what the people wanted, and had been known to in- dulge in warning lectures to those of his colleagues who were somewhat lacking in regard for public opinion. It was this that gave him his superior grasp of national politics and made him the ^^easy boss" in New York. 23 THE WRECK Where Mark Hanna's control reached the point of sheer force and at times was ahnost brutal, Tom Piatt prevailed by the exercise of persuasive reason. In his dealings with party leaders it was his custom to ask them what they wanted in the way of recogni- tion. After that he would quietly request them to indicate what they really expected to get, pointing out the danger there might be in demanding too much. If the delegate or state leader was not satisfied with this and went to Hanna with his troubles, without the least bit of cere- mony he would be told very positively and conclusively what he could or could not have. At Philadelphia a large number of the delegates favored Roosevelt, as did Senator Piatt, because, on account of the part he had taken in the Cuban campaign, he filled the popular eye as a hero. It has almost always turned out that the party which rec- ognizes the war hero is sure of success at the polls. 24 RIPENING OF THE TRUST Roosevelt was a delegate in the conven- tion and his enthusiastic admirers besieged him with requests to permit the use of his name on the ticket. Not a few of his friends went so far as to insist that he should be at the head of it. Indeed, as the milling and mixing of del- egates proceeded, Hanna demanding and Piatt advising and conciliating, sentiment swung seriously to Roosevelt for first posi- tion. The movement gained such momen- tum that not only were the McKinley forces greatly disturbed, but, in the party's inter- est, the ColonePs more cautious friends found it necessary to detain him in his pri- vate room during the evening preceding the meeting of the convention, for whenever he showed himself the crowd seemed to loose its equilibrium. Of course it would have been a serious party mistake to have nomi- nated him in place of McKinley. Inadvertently, no doubt, Roosevelt had come to the great Republican meeting wear- ing a slouch hat. This was an innovation, 25 THE WRECK for New York always appears at the big party shows topped in shining silk beavers. Had the Colonel worn an old khaki nnif orm on this occasion there is no knowing what might have happened. There were those in Philadelphia willing to make oath that the Roosevelt chapean, carelessly tilted so as to shade his bronzed face, had seen service at San Juan Hill. It is difficult to measure the flood of volatile emotions that go to make up a rad- ical movement in politics, or to locate its source. No one doubts the fact, however, that the superimaginative citizen has never failed to find in Theodore Roosevelt all the elements to stir the crusader. In this in- stance even the Colonel's old hat served to arouse the mercurial multitude. Still, the feeling that the Republican cause, to insure success, needed to be strengthened at a point where weakness was already apparent was much deeper than even the astutest leaders of that day sup- posed it to be. 26 EIPENING OF THE TRUST True, the party's promises, as said by McKinley, had been carried out, and peace and plenty, or what passed for it, had re- turned to the land ; yet there were accumu- lating evidences of disquietude which boded no good for future solidarity. The rapid growth of monopoly in the leading lines of business, the certainty of its spread to all other lines, and its ultimate triumph over healthy competitive forces was the disturbing factor. The gentle McKinley, champion of the doctrine of protection, sincerely believed that complete happiness among the people would surely follow the permanent estab- lishment of this American fiscal policy, and that all else would be adjusted to harmonize with it. Having assisted in an advisory way in framing the anti-trust statute, he had the utmost confidence in its efficacy as a cor- rective. Being a just man, he believed in its enforcement. He could see no differ- ence between the big criminal and the little 27 THE WRECK one; they were equal under the law. Such was his abiding faith in the character of our institutions. Looking back to that period, it is im- possible to realize that in the face of solemn restraining statutes the thing now kno\^Ti as ^^Big Business," — then the mere germ of monopoly, — would ever be permitted to reach its present proportions as a control- ling force in the affairs of the country. It was inconceivable that the mighty hand of the Government should fall as if paralyzed ; or worse, that it should be used to protect those who spurned the law. When McKinley came to the Presidency in 1897 all industry was at low tide. Armies of unemployed men had been tramping the highways demanding the op- portunity to work. It was no time for fine distinctions as to the meaning of the anti- trust law, then only in the seventh year of its uncertainty. The shops must be opened and the wheels of commerce set in motion. As a matter of fact there were no 28 RIPENING OF THE TRUST *^ trusts" in the sense that they now exist. There was no business to be monopolized. Faihires and receiverships were having their innings, and Democratic statesmen were explaining that these conditions had come about in consequence of the sudden change from artificial to natural laws. While political economists may never agree as to the fundamental cause, the Democratic theory was not without plausi- bility. Nor did it deter Republicans at the end of McKinley's first term from pointing with pride to the beneficent results of their policies. Business had revived to an un- precedented degree, and the hungry hordes did not stop to inquire into the ethics of it. Old mills were in operation again and new ones were being built. There was a demand for labor and an active market for commodities. This was the appearance of happiness that McKinley spoke of as he was leaving his home at Canton to attend the Buffalo exposition in September, 1901. The Democratic answer was that business 29 THE WRECK could not remain ahvays dormant, and that we should soon see the consequences of Re- publican artifice. As this is being written Congress is con- vening in extra session for the fifth time in nineteen years for the purpose of revising the tariff. Are we at last to have done with this troublesome question? We shall see. However, as the two old parties appear to be as wide apart as ever in the matter of policy, the prospect is not at all promising. It has been proposed, in order to avoid these frequent revisions, that a permanent tariff commission be created, and that this superconstitutional body shall change the rates of duty from time to time as condi- tions may require. The danger here is that the country might have a repetition of the experience it has had with the Bureau of Corporations, which was created to gather information in regard to the trusts and in a very short time became the protector of such trusts as were agreeable to it and its master. 30 EIPENING OF THE TRUST With the great revival of business, be- ginning with the first McKinley administra- tion, came also increased activity on the part of capital. As yet there had seemed to be no necessity for resorting to the Sher- man law to prevent industrial and other combinations. Although it was the product of a Repub- lican administration designed to prohibit monopoly by direct statute, the Philadel- phia convention of 1900 did not even refer to the anti-trust statute, but contented itself with declaring anew against ^^all conspira- cies and combinations intended to restrict business, to create monopolies, to limit pro- duction, or to control prices." It went further and favored ^^such legislation as will effectively restrain and prevent such abuses, and protect and promote competition," — as if the anti-trust law were not in exist- ence! In this respect the party was not entirely true to itself. How much better had the convention ^^ pointed with pride" here and 31 THE WRECK pledged itself to the enforcement of exist- ing law. Can it be that designing men were already enlisted in their work of nullifica- tion? The author of these pages has no doubt whatever that such was the case. As has been said, there was a feeling of unrest, of apprehension. The Steel trust, the monopoly in farm machinery, and many other combinations had not been organized. The era of ^^ moralized competition" re- cently referred to by a prominent attorney for the trusts, — in contradistinction to monopolized competition, no doubt, — ^had not yet arrived. The fact that it was near at hand, how- ever, impressed itself upon many of the delegates, who, though they had every con- fidence in McKinley's honesty and patriotic sturdiness, could see that the country was facing a problem of much greater import than the one with which the party had al- ready successfully dealt, — that is, the mere restoration of active business and the dis- persion of the Coxey army. 32 EIPENING OF THE TEUST In the interest of accuracy it must be said that they were impressed, too, with a feel- ing that, in view of his surroundings and his support by certain selfish interests, there was very grave doubt in regard to McKin- ley's ability to deal with this new problem; and it was believed that a stronger hand than his would be required to cope with the aggressive men who were now preparing to seize upon the country's reviving industries and convert them to personal and corporate ends. To those who really knew McKinley these apprehensions were groundless. There has never been any substantial doubt in regard to his purpose to have the law enforced, for he was a man of integrity, and held his oath of office to be the chart of his conduct. With these doubts in their minds and with the record and the professions of Colonel Roosevelt before them, to whom other than he could the delegates turn for safe leadership for the future? No great public problem has ever arisen that the man 33 THE WRECK did not appear, or seem to appear, to solve it. In this instance there could be no mis- take : Roosevelt was the man of the hour, — the one to carry the party banner through the close and doubtful states as an olfset to the equally intrepid, not to say impetuous, Bryan. Besides, it would put him in line as Mc- Kinley's successor, — the thing above all else that Hanna had feared until he was reas- sured by Piatt that Roosevelt was not dan- gerous. The feeling among the so-called radicals that they must have some one upon whom to lean and who stood firmly for what they believed in was very genuine. Not one of them could have given an entirely satis- factory reason at that time for his appre- hensions. They only knew that the condi- tions were ominous, that all signs presaged darker days for the Republic. With the exception of Senator Hanna and his immediate circle of conservatives no one had any doubt about Roosevelt's abso- lute sincerity. The people had been read- 34 I RIPEmNG OF THE TRUST ing his books and speeches, and had found them good, — replete with wholesome advice, bristling with patriotic thoughts, although some close observers declared that he was somewhat preachy. He was fresh from the field of battle, out of whose hardships love of country usually finds its inspiration. The newspapers were recounting many in- stances of his valor. He was young in body and vigorous of mind, and his strong Americanism and pronounced ideas in re- gard to ofiicial integrity and civic virtue sent a thrill to the hearts of the hopeful. It was expressions like these from his book ^^The Strenuous Life" (1899) that drew men to him: "Our standard of public and private conduct will never be raised to the proper level until we make the scoundrel who succeeds feel the weight of a hostile public opinion even more strongly than the scoundrel who fails." These were strong words. To put them into force and effect required the deter- mined efforts of a strong man. No weak- 35 THE WRECK ling could do it. Roosevelt was not a weak- ling. What he appears to have had in his mind was hinted at in a speech delivered at Galena, April, 1900, shortly before the Philadelphia convention. The occasion was a Grant anniversary. Among other things he said : "The Republic cannot stand if honesty and decency do not prevail alike in public and private life; if we do not set our- selves seriously at work to solve the tremendous social prob- lems forced upon us by the far-reaching social changes of the last two generations." How could any man who spoke thus, being sincere, go wrong? Ten years later, in his address delivered at the Sorbonne in Paris, he said: "My position in regard to the moneyed interests can be put in a few words. In every civilized society property rights must be carefully safeguarded; ordinarily, and in the great majority of cases, human rights and property rights are fundamentally and in the long run identical; but when it clearly appears that there is a real conflict between ttiem, hu- man rights must have the upper hand, for property belongs to man and not man to property." Sentiments as old as government itself, no less true when Thomas Paine uttered 36 I RIPENING OF THE TRUST tliem than they were in the more material age when the Steel and Harvester monopo- lies, with their inflated capitalization and political influence, were enjoying the pro- tection of the Roosevelt administration, contrary to the laws of the country. It is conceded that McKinley had lived up to the standard of public expectation; that he had been the successful leader of his time. The problem which destiny seemed to have created Theodore Roosevelt to solve was a new one, — new, at least, to the new century. True, monopoly as an institution was as old as civilization itself. Yet at no time in the past, not even in the middle ages, had it ever been recognized as a beneficent thing. England three hundred years before had not permitted it to reach a state of un- governableness, but had punished those who engaged in it by confiscating their property, by the imprisonment of offenders, and even by the cutting off of ears. Upon the forestallers of the market the severest 37 THE WRECK penalties had been inflicted and the culprits driven from the places of bargain and trade. In our own enlightened time, through the indifference or worse of an executive given to high-sounding and virtuous phrase, the monopolist was permitted to escape. Con- gress had provided the country with re- straining statutes, — a national challenge to individual and collective selfishness; a law with a soul, or at least with teeth and in- testines. Although a quarter of a century has gone by since it was framed, it has stood every test of judicial interpretation. If it has not been effectively enforced no blame at- taches to the la^^Tiiaking body, the object of Roosevelt's cuttlefish attacks. Congress early saw its duty and had the courage and the honesty to act. Lawyers, — those whose minds are not swayed by visions of large fees, — will ex- amine our statute books and fail to find a piece of legislation more perfect than the Sherman law. Its first three sections are 38 EIPENING OF THE TRUST peculiarly suggestive of the necessities of the occasion: Sec. 1. Every contract, combination in the form of trust or otherwise, or conspiracy, in restraint of trade or com- merce among the several States, or with foreign nations, is hereby declared to be illegal. Every person who shall make any such contract or engage in any such combination or con- spiracy, shall be deemed guilty of a misdemeanor, and, on con- viction thereof, shall be punished by fine not exceeding five thousand dollars, or by imprisonment not exceeding one year, or by both said punishments, in the discretion of the court. Sec. 2. Every person who shall monopolize, or attempt to monopolize, or combine or conspire with any other person or persons to monopolize any part of the trade or commerce among the several States, or with foreign nations, shall be deemed guilty of a misdemeanor, and, on conviction thereof shall be punished by fine not exceeding five thousand dollars, or by imprisonment not exceeding one year, or by both said punishments, in the discretion of the court. Sec. 3. Every contract, combination in form of trust or otherwise, or conspiracy, in restraint of trade or commerce in any Territory of the United States or of the District of Columbia, or in restraint of trade or commerce between any such Territory and another, or between any such Territory or Territories and any State or States or the District of Columbia, or with foreign nations, or between the District of Columbia and any State or States or foreign nations, is hereby declared illegal. Every person who shall make any such eon- tract or engage in any such combination or conspiracy shall be deemed guilty of a misdemeanor, and, on conviction thereof, shall be punished by fine not exceeding five thousand dollars, 39 THE WRECK or by imprisonment not exceeding one year, or by both said punishments, in the discretion of the court. Now and again some student of statecraft will ask why it was that the jail penalties were made so light. Mr. Sherman, who in- troduced the bill in the Senate, answered the question. He told an inquiring friend that this phase of the matter had given the framers of the law,— Senators Edmunds, Hoar, George, Ingalls, and himself,— much concern, and that they had finally agreed that one year's imprisonment would be a greater punishment to the man capable of organizing or conducting a monopoly than twenty years would be to the ordinary crim- inal; that the monopolist's real punishment would begin when he had been released from jail to mmgle again with his fellow- men. It was believed that the very thought of it would react as a deterrent to all such offenders. One who cares to pursue the subject as a psychological study may do well to search out some past offender, if any such can be 40 EIPENING OF THE TRUST found, and examine liis mind on the sub- ject. No doubt the result would make an illuminating chapter in politico-criminal literature. The explanation of Mr. Sherman is in- teresting in that it illustrates what was in the minds of the distinguished men who framed the important statute as well as the intent of the Congress that passed it. No one who knew the heart of William Mc- Kinley has any doubt about what he would have done had he lived. Although he was slow to act, he had a profoimd reverence for the laws of his country. It is known that he favored the criminal provisions of the anti-trust measure and appreciated the ne- cessity for them. 41 EOOSEVELT IN THE SADDLE THE American people have been pe- culiarly fortunate in choosing high- minded and level-headed men for the great office of President. Mistakes in this regard have been exceedingly rare, and, save in a single instance, these have been discovered and corrected before permanent harm had been accomplished. But it is not always the President who shapes the policy of the country. Too often it has been some shrewd cabinet min- ister or other trusted official who at the crucial moment gave the vital matter a sin- ister turn. Some one has said that if permitted to name the poet to write the nation's songs he would have little care concerning its politics. In a measure this sentiment might be ap- plied to certain administrations. 42 EOOSEVELT IN THE SADDLE There are great interests that do not trouble themselves about who is President or what his politics is, provided they may be assured beforehand in regard to the man who is to be Attorney-General. These same interests are also very exacting when it comes to the selection of a Secretary of the Treasury. The first executes the law, or is supposed to execute it, and the other handles the nation's money, or permits it to be handled. Hence the anxiety of Wall Street in regard to matters in Washington. McKinley's was a trustful nature. He was not disposed to be suspicious of men's motives, and as a rule accepted their word in complete confidence that it would be kept. IN'or did he distrust their judgment even when it did not entirely agree with his own. That he was often deceived would be no more than might be expected. The one great saving clause in his make-up, how- ever, was that he never acted hastily. He proceeded upon the theory that all men make mistakes; that none of us is in- 43 THE WRECK fallible. Thus, in the end, he would reach sound conclusions. Another admirable quality in McKinley was that he never lectured his coadjutors, belittled their capacity, nor reflected upon their integrity. He believed that men's errors would find them out and be corrected by the rule of self-reason. He was not a preacher, but rather an expounder of wise, well-considered economic doctrines by which the ship of state, as he gave it esti- mate, would gain safe harbor. Roosevelt came to the Presidency after McKinley 's second cabinet had been named. It was generally understood that he would carry out the policies of his unfortunate predecessor and of his party. The country was prosperous, as prosperity has been ac- cepted. The workingman's dinner-pail, now made of American tin-plate, was full to the bulging point. What more had he to ask? If its contents were costing a few cents more than formerly, was he not re- ceiving greater wages than had been paid 44 EOOSEVELT IN THE SADDLE liim for his labor four years back^ It was an unanswerable argument in favor of Re- publican doctrine, to which Eoosevelt was pledged. Hence it was pointed out that his task would be an easy one. He had but to sit tight where McKinley had sat and permit the people to go on thriving as before. No matter what McKinley himself would have done to check the combinations of capital, which was now girding its loins to larger efforts, if the new President would but stay the ^^ strong hand'' and permit ^^big busi- ness" to develop our wonderful resources as only big business could, we would astonish the world with our marvelous progress. It was a captivating plea in behalf of American enterprise and continued good times, and, by the instinctive application of persuasive methods so familiar to the cap- tains of industry, Eoosevelt had been im- pressed with it even before he took the oath of office at Buffalo. By the time he arrived in Washington to take his seat in the White 45 THE WRECK House he had assured Mr. Root of his com- plete acquiescence in the project; there would be no change in policy, no radical recommendations, nor other disturbing acts hostile to ^S^ested rights" — that is to say, not against those engaged in ^^ honest occupa- tions/' Whether Mr. Root remained in the cab- inet merely to see that the compact was kept is only incidental. It is a well under- stood fact, however, that he wielded a great influence over the new President. Throughout Roosevelt's seven and a half years in the White House Mr. Root was near him, — ^his closest adviser, indeed. This was not altogether pleasing to those who at Philadelphia had insisted upon the recognition of the hero of San Juan Hill. It was a matter of common knowledge that for years Mr. Root had been the legal ad- viser of large interests in New York; and while this was not held to be a disqualifica- tion, a bar to his occupying a high place in the Government, somehow the feeling so 46 EOOSEVELT IN THE SADDLE long prevalent in certain sections against the political dominance of Jersey corpora- tions operated to make Mr. Root's close re- lations to the President a dubious factor and to raise some doubt about the abso- lute certainty of a *^ square deal'' at the White House. These doubts were not allayed when, as time passed, the President not only found no fault with the Steel trust, then but re- cently organized, but actually received as welcome visitors the principal men who had put it together. The effect of these close relations was to embolden the promoters of monopoly and sadden the hearts of the Roosevelt adherents, who had persuaded themselves that if the anti-trust law was to be enforced their champion was the man to do it. They looked to him to put a few of the greater offenders in jail, but in vain. The murmurs of disappointment were not loud, but they were deep and significant. The monopolists and their sympathizers were pleased, of course ; but they restrained 47 THE WRECK their enthusiasm while they increased their activities. Here, then, was the beginning of the pre- arranged campaign for the overthrow of the potent clauses of the Sherman law, and it also marked the inevitable disintegration of the Republican party, which had put it on the statute books. The process was slow, as is always the case when momentous ethical revolutions take place, and yet it was most effective. The earlier manifestations of the party's dissolution showed themselves in the form of ^ insurgency'' so-called, particularly in the western states. It matters very little what name is given to a political movement ; it is the reason for it that counts. A re- markable thing about the insurgent agita- tion was that Roosevelt encouraged it. Notwithstanding the fact that at heart it was a protest against the aggressions of monopoly, for which he was largely respon-j sible, he managed to turn it to his own po-j 48 ROOSEVELT IN THE SADDLE litical account ; for it is not to be denied that the movement was accelerated by the organ- ization of the International Harvester company, which took place in 1902, under the very eye of the Roosevelt administra- tion. Attention was diverted from this event by the peculiar twist given about this time to various other matters entering into popu- lar discussion, and Roosevelt's nimbleness in centering his fire on Congress, which had already given the country an anti-trust remedy. For several years back there had been considerable criticism of the Government's public land policy. Charges had been made that the public domain was being ab- sorbed by well-organized syndicates; that coal and other valuable lands were passing to private and corporate ownership through the wrong use of statutes designed to ac- commodate individual settlers and populate the waste places. The concerted attacks that were made in 49 THE WRECK a few newspapers when other sensational material was short not only presupposed the existence of a great number of syndicates, large and small, alleged to be engaged in the illegitimate business, but implied the co- operation of the thousands of settlers who in reality were honestly seeking to make homes for themselves. These hardy people were scattered over a wide expanse of territory and being poor were not in a situation to defend themselves. This brought the senators and members rep- resenting public land states as yet unsettled to the rescue, and replies to the premed- itated onslaughts were made in Congress. The defense offered immediately met with the answer that the defenders themselves were engaged, along with the others, in ^'looting the people's heritage.'' Thus was the public mind diverted from the real issue. In time the agitation gave rise to an at- tractive campaign in behalf of ^^the conser- vation of the natural resources," and it was surprising how many there were who had 50 EOOSEVELT IN THE SADDLE never seen an acre of Government land who joined in this newest crusade. Yet it seems never to have occurred to the general public that the leaders of the prop- aganda, not a few of them, might be en- gaged in attempting to accomplish in their own selfish interests the very things they were roundly denouncing. It soon developed, however, that the ^ * con- servationists " had their special publica- tions, notably a periodical known as The Talisman; that, besides having the sym- pathetic assistance of the President, they had a thoroughly organized press agency in Washington, including publicity bureaus, at the head of which were civil service em- ployees whose names were on the Govern- ment pay-roll. These men devoted their entire time to writing, lecturing and agita- ting in the interest of the repeal of the homestead law. It also fell out that the editor of The Tal- isman was in the employ of the land grant railroads at a salary of $45,000 a year, made 51 THE WRECK up by equal contributions from the several railway companies having lands for sale. Thus it came to dawn upon the minds of those who cared to analyze the situation with fairness that if the land laws should be repealed the tide of settlers would neces- sarily be turned to the lands held in private ownership. This was the milk in the re- form cocoanut. The President's alert sympathies being now enlisted on the side of ^^conservation," he seized upon the opportunity to belabor Congress for its ' ' negligence. ' ' He directed his attacks upon those senators and mem- bers who stood for the interests of their struggling constituents, — the homestead settlers, — and opposed the schemes of the private landowners. It was through the methods herein de- scribed that ^' conservation" became one of the Roosevelt policies, that the ''big stick" materialized as a personal weapon, and that the term ''reactionary" came into use. It is true that the land laws were being 52 ROOSEVELT IN THE SADDLE misused by a small number of settlers and others, but where one settler was found who did not comply strictly with the statute there were thousands who were trying to make actual homes for themselves. But little is known outside of the west- ern section of the privations endured by the brave men and women who have cast their lot upon the wild lands of the Government. Ninety-nine per cent, of them were with- out means. Many of them came from the overcrowded cities and knew little of the trials of home building. At best under these circumstances their condition was pitiable enough, and they earned any re- ward that came to them. In addition to the unavoidable hardships with which they were beset they were har- assed by special agents, — Government spies, — who seldom neglected to increase the bur- dens of the pioneers by making sensational reports to the department, depicting the ^^ perfect reign of dishonesty and fraud'' that was going on. 53 THE WRECK These reports contributed immensely to the cleverness of the special agents and were heralded broadcast in justification of the campaign on the part of the private land syndicate. By this aggregation of ^'re- formers" the homestead settler was branded as a thief and perjurer, and the men who took up his cause were grossly maligned by those pluming themselves as leaders of a crusade of righteousness. Besides contributing to the financial bene- fit of those who instigated the wicked work and to the glory of the zealots who assisted them, the agitation served the deeper pur- pose of diverting the public mind from the remissness of officials in other directions. It was during this period that business combination on a large scale got its perma- nent footing, — its strangle hold upon the country's industries. From 1901 to 1909 regnant monopoly passed from infancy to gianthood practically unmolested. The civil actions instituted against the trusts by the Department of Justice were 54 r EOOSEVELT IN THE SADDLE paraded as evidence that the administration was alert in enforcing the law. Thus the public was entertained and comforted, but the trust itself was not restrained. It could well afford to pay the insignificant fines imposed and pass on to greater achieve- ments and permanency. Yet the records of the department do not disclose a single in- stance wherein any individual of note en- gaged in breaking the laws of his country \\^s sent to jail. The punishment of lesser offenders against the long list of criminal statutes went on unabated, while the ^'big fish'' went free. These facts of history, used in a desultory way in the heat of campaigns gone by, de- serve to be recorded in the light of some im- portant results that followed. They are entitled to consideration here because of their ominous consequences to future gen- erations, to say nothing of the burdens im- posed upon this one. How many of our statesmen have paused long enough to examine into the country's 55 THE WRECK trust policy under Roosevelt *? And how few there are in these strenuous times who are reasoning it out for themselves. There was a certain fascination in the Roosevelt messsages. They could be relied upon in advance to stir the superficial mind to a frenzy of resentment against prevailing ills, but more particularly against ills that were purely hypothetical. Long ago it came to be an American habit to applaud the man who has the faculty artfully to stigmatize his fellows; it is something worth while to see the victim squirm, be he ever so innocent a target. Roosevelt possesses this peculiar knack as few others have it, and during the last half of his administration he exercised it freely, centering his fire chiefly upon the Congress. Now, the American Congress has never been a perfect model of uprightness. Be- ing human, it has done some things which it ought not to have done and neglected others which might have been accomplished for the general good. On the whole, how- 56 ROOSEVELT IN THE SADDLE ever, it has performed its important duties creditably and for the most part in the pub- lic interest. One of its weak points, — its very weakest perhaps, — is its disinclination to offend the administrative branch of the Government. While it may di:ffer from the President or members of his cabinet in some things, to outward appearances it invariably accords to these officials the consideration that is their due. \ To have the confidence of the President is to be regarded with favor by the people ; to be at war with him is to invite censure at home. Senators and members will en- dure a great deal before breaking with the chief executive, or even disagreeing with him, save in matters wherein the minority never agrees with the majority, and vice versa. In the light of all this the ordinary civili- ties of life would seem to demand that the President himself shall show that he is not lacking in those qualities that belong to the 57 THE WEECK recognized courtesies of official life. That lie may stand before the country as the very archetype of good manners, thus maintain- ing the dignity of his station, he should cul- tivate urbanity. This quality was inherent in Washington, in Lincoln, and in McKinley. It was lack- ing in Eoosevelt. His attitude toward Congress was not unlike his attitude toward a fresh squad of very coarse policemen when he was commissioner in New York. One would suppose that with his superior ability and having enjoyed exceptional edu- cational advantages, he would have discov- ered, in the natural order of things, that there is a wide difference between the point of view and the importance of a constable and that of the men whom the people choose to make their laws in Congress. Roosevelt did not distinguish between the two grades of men. President Eoosevelt did not rise above Police Commissioner Eoosevelt. It is not surprising therefore that he forgot some things that are due to 58 ROOSEVELT IN THE SADDLE the great office of President of the United States. Not that it is out of place for the President to lecture Congress as a body if occasion require it, but it must be done in a way not to cast reproach upon it. It should be assumed that Congress is composed of men of the highest motives. Should it turn out that this is not the case the people themselves will make the discov- ery. It is not for the President because he is^sometimes spoken of as being at the head 01^ the nation, — Avhich is not strictly a fact, —to belittle his fellow officials, whose re- sponsibilities, in their sphere, are quite as great as his. To judge of the American Congress by the Roosevelt estimate, as outlined in some of his public utterances, but more especially in his contemptuous general disregard of it, one might be inclined to look upon it as a body of very inferior persons banded to- gether for plunder. This is the hurtful im- pression created by Roosevelt's attitude to- ward it. 59 THE WRECK Yet it was this branch of the Govern- ment that gave the country that legislative masterpiece known as the Sherman anti- trust law, which Roosevelt took a solemn oath to enforce. It was his insolent disre- gard for the vital provisions of this statute, which the ''good trusts" were permitted to override, that changed our republican institutions to an oligarchy of legalized monopoly. Indisputable proof of this statement is found in a remarkable letter written in 1907 by the Roosevelt Commissioner of Corpora- tions, Herbert Knox Smith, an official who, upon his retirement to private life, allied himself with the bolting Roosevelt politi- cians, now under the financial care of George W. Perkins, organizer of trusts. A more flagrant betrayal of the people than the one revealed in this confidential letter cannot be found in all the annals of our time, and we are left to wonder which of the many very able lawyers on the re- tained list of the powerful Morgan inter- 60 ROOSEVELT IN THE SADDLE ests was the author of the frank and care- fully prepared document. A recital of the details whereby it came to light makes an interesting chapter in itself and fixes beyond all peradventure the part that Roosevelt played in the great conspir- acy. Liberal excerpts from the letter will suffice. It should be explained, however, that the letter, although written in the fall of J-907, was not made public until three years later. ^ And had it not been for the positive state- ment of Colonel Roosevelt that he had not ordered the suspension of legal proceedings against the Harvester monopoly, when the contrary was known by a very few to be true, the letter would still be a part of the secret archives of the Department of Com- merce and Labor, where it is claimed to have originated. At any rate, it was signed by Commissioner Smith. It furnishes a startling revelation of the close relations which had long existed be- tween the then President and the arch or- 61 THE WRECK ganizer of trusts, Mr. Perkins. It also reveals the real attitude of Roosevelt in the matter of law enforcement; and it shows how lightly his oath of office sat upon his conscience and how he used his high place to shield his personal and political friends. The letter begins : "On August 27, 1907, by direction of the President, I met Mr. George W. Perkins, chairman of the finance committee of the International Harvester Company, and discussed the mat- ter with him. August 26 I saw the President and stated briefly my views, and upon his instructions I then, on the next day, saw the Attorney General at Lenox, Mass." Although the case had been prepared ready to file with the court months before, Attorney General Bonaparte told Mr. Smith that he was not ready to take it up. Mr. Smith then goes on to say that he did not discuss the matter further with Mr. Bonaparte, ^^ knowing that the President had instructed the Attorney General to take no further action in this matter" until ^^a final conference could be held. ' ' There is no record of any such ^^ final con- 62 ROOSEVELT IN THE SADDLE ference." Yet there is no doubt that sev- eral were held, for Mr. Perkins continued to be a visitor at the White House, the Bureau of Corporations, and the Department of Justice. That the Harvester monopolists were in full accord with the policy of the adminis- tration and were trying to forget their original offense, — the creation of a combina- tiojQr in restraint of trade, — appears further along in the letter : "Briefly, the International Harvester Company, through Mr. Perkins, takes the position that it has, ever since the creation of the Bureau of Corporations, endeavored to put itself in line with the policy of publicity maintained by the Administration: that, so far as it is aware, it has committed no violation of any statute; that it has continued to offer to the bureau from time to time complete access to all its books and papers and to irive all the information desired as to its operation; that it has, indeed, frequently ur^ed such investigation by the bureau; that it can obtain no direct information at all as to the nature of the charges against it, but that it has reason to believe that tlie case against it is purely a technical, legal one under the Sherman law, involving merely an interesting legal question as to whether the or- ganization of the company per se constitutes a combination in restraint of trade, and that no moral sin or methods of unfair competition are included in said case." 63 THE WRECK But for the serious consequences to man- kind involved in the rise and the progress of monopoly in the United States under Roosevelt the letter of his commissioner and the view taken by the ^'harvesters" would be almost humorous. It recalls an incident in the early history of a western state. A prominent citizen had stolen a horse and was in an adjoining state trying to dispose of it. Failing in this, he agreed to do some plow- ing for a farmer. After a time, under the mollifying influence of his earnings, no doubt, he wrote home to his son to see the sheriif and tell him that as the animal was being put to good use in advancing the in- terests of agriculture no ''moral sin" had been committed. The Smith letter continues: "To the extent of my present knowledge, I am satisfied that the facts are as stated by the said company, with the single exception that I do not have definite knowledge as to the nature of the case now in the hands of tlie Department of Justice, but, from expressions of the Attorney General, I am inclined to believe that it is, as Mr. Perkins stated, a 64 I ROOSEVELT IN THE SADDLE purely technical, legal question. As to the principle of fair dealing and good policy involved, I also concur emphatically with the attitude of the company. It is certainly true that this company has been most open with the bureau." Mr. Smith's emphatic concurrence ^^with the attitude of the company" appears to have met with the concurrence of the Presi- dent, who permitted Mr. Perkins, through Mr. Smith, to use a Senate resohition to smother action on the part of the Depart- ment of Justice, which decided to withhold its suit so long as the Department of Com- merce and Labor was engaged in making an investigation. With this Smith ceased to investigate! The Senate resolution was held in his office nearly seven years from the date of its passage, — another illustration of ''how not to do it.'' The intimate relations of the ''good trusts" with Mr. Smith's bureau are thus set forth: "Furthermore, the attitude of the Morgan interests gener- ally, which controlled this company, has been one of active cooperation. In the investigation of the steel in- dustry the United States Steel Corporation has already spent thousands of dollars in compiling for the bureau the most 65 THE WEECK complete and intimate information as to the business, and its officers have gone to immense trouble and loss of time to facilitate in every way our work." At this point the letter reveals the fact that Mr. Perkins saw and talked with Mr. Smith August 24, two days before Smith sent his letter to the President. In that in- terview Mr. Perkins said: "That the interests he represented, including not only the International Harvester Company, but also the far-reaching Morgan interests generally, had originally favored the crea- tion of the Bureau of Corporations and the policy of the President which that bureau represents. He concluded, with great emphasis, with the remark that if after all the en- deavors of this company and the other Morgan interests to uphold the policy of the Administration and to adopt their method of modern publicity, this company was now to be at- tacked in a purely technical case, the interests he represented were going to fight. So far as I have knowledge of the facts set forth by Mr. Perkins," Mr. Smith wrote, "I believe them to be true. I liave no knowledge of any moral ground for attack on the company." But the hero of San Juan Hill seems not to have been in a fighting mood just then. He swallowed Mr. Perkins' threat and per- mitted him to have his own way in the mat- ter. 66 .1 ROOSEVELT IN THE SADDLE And now we have an exhibition of the ease with which a bureau official, in further- ance of a President's policy, overturns an act of Congress : "I believe that industrial combination is an economic necessity; that the Sherman law, as interpreted by the Supreme Court, is an economic absurdity and is impossible of general enforcement and, even if partially enforced, will, in most cases, work only evil. I believe the principle it repre- sents must ultimately be abandoned; that combination must be allowed and then regulated." ^Every monopolist in the country will agree with Mr. Smith that the Sherman law is ^^an economic absurdity" and that ^^com- bination must be allowed and then regu- lated. '^ In the light of their experience un- der Roosevelt what would they have to fear from '^regulation''? The truth is that George W. Perkins, known as the political scout of Wall Street, originated the policy of '^ regulation." At least a year before it was finally adopted by the Roosevelt ad- ministration Mr. Perkins was very busy advocating it in lectures and speeches. 67 THE WEECK There is a refreshing naivete in Mr. Smith's estimate of the value to the admin- istration of the Morgan influence. Under this head he says : "If now, by such a retrogression, through the crude theories represented by the Sherman law, these interests are shown that prohibition, and not regulation, of combinations is to be carried out, they will feel that there is nothing left for them but to fight, and their great influence will be thrown against not only this but any other attempt at corporate reform. "In the specific instance involved, this matter is demon- strated. The mere refusal of the Steel Corporation to give information except at the end of a lawsuit would practically cripple the steel inquiry of the bureau. Un- questionably such refusal would be the first step in the fight. "While the Administration has never hesitated to grapple with any of the financial interests, no matter how great, when it is believed that a substantial wrong is being committed, it is a very practical question whether it is well to throw away now the great influence of the so-called Morgan interests, which up to this time have supported the advanced policy of the Administration, both in the general principles and in the application thereof to their specific interests, and place them generally in opposition." There is an air of frankness in this sug- gested partnership between the Morgan monopolies and the administration that al- 68 I EOOSEVELT IN THE SADDLE most takes the breath away. And Smith was not even rebuked for making it. In closing his letter Roosevelt's super- serviceable commissioner points out the danger to the Morgan interests should com- petition be restored : "I believe that Mr. Perkins' statement that his interests would necessarily be driven into active competition was a sincere one, and in fact I can hardly see how these great interests can take any other attitude should this prosecution be started and the final adoption of this policy be made ptAlic." What becomes of the persistent avowals of the Republican party in favor of compe- tition, the life of trade, after this profound declaration of Mr. Smith that Mr. Perkins, representing ^^the great influence of the so- called Morgan interests, ' ' was opposed to it ^ Is it to be wondered at that they now have a party of their own and that Roosevelt is its prophet ? 69 MONOPOLY'S RAPID PACE A CAREFUL examination, of Roose- velt's messages to Congress from 1901 to 1909 shows a greatly modi- fied spirit on his part toward ^^the scoundrel who succeeds," as expressed in his book ^^The Strenuous Life" in 1899, and in his Grant speech in 1900, wherein he said: ^^The Republic cannot stand if honesty and decency do not prevail alil^e in public and private life." Whom had he in mind and to whom did the public believe he referred when he spoke of '^the scoundrel who succeeds"? Was it not the men who were at that moment mak- ing ready to combine the competing steel plants of the country, with actual assets of less than $700,000,000 into a single corpora- tion with a capital of $1,400,000,000 ?— the men who paid Andrew Carnegie $200,000,- 70 MONOPOLY'S RAPID PACE 000 more than his property was worth in or- der to get rid of a rival concern ? On the same page of the newspapers that reported Roosevelt's stirring speeches in 1901 may be read an account of the or- ganization of the Steel trust, with its enor- mously inflated capitalization upon which the people were helplessly bound to pay and are paying a perpetual tax. Before very long a promising competitor of this monster combination grew up in the far south. It was known as the Tennessee Coal and Iron Company, with a capital of $30,000,000. It soon came to be a thorn in the flesh of the big Morgan monopoly. What happened in the case of the Tennes- see concern is quite fully described in a speech delivered by Senator James A. Reed, of Missouri, in August, 1912. He said: "It possessed such natural advantages that its independent continuance menaced the monopoly prices of the Morgan- Perkins trust. Wlien the panic of 1907 came on the great money power tlireatened to close down upon it. Controlling the money power was Morgan and Perkins. "Representatives of Morgan and Perkins came to Wash- 71 THE WRECK ington, laid the entire transaction before the President, Mr. Roosevelt, and secured from him a promise of immunity from punishment. He sanctioned the destruction of the last great rival of Morgan's and Perkins's Steel trust. "If it was worth more than $200,000,000 to remove the rivalry of the Carnegie plants, it certainly was worth much more to destroy the rivalry, and at the same time acquire the properties of the Tennessee Coal and Iron Company. Is it any wonder that Perkins still remains faithful ? "I call attention to the second incident: In April of this year there was printed in a Senate document the cor- respondence which showed that when the Attorney General, in the year 1907, was about to prosecute the Harvester trust Perkins insolently demanded that Roosevelt stop the prosecu- tions. His orders were truculently obeyed. "This is what Perkins told the President's representative, Herbert Knox Smith, all of which Smith wrote to the Presi- dent: 'Mr. Perkins concluded with great emphasis with the remark that if after all the endeavors of his company and the other Morgan interests to uphold the policies of the ad- ministration and to adopt their methods of modern publicity this company was now to be attacked in a purely technical case, the interests which he represented were going to fight.' "This impudent and unparalleled message was communi- cated to the President by Mr. Smith, and in whining, dis- graceful obedience to it Roosevelt ordered the discontinuance of the prosecution. It was not a case of the clay saying to the potter, 'Why hast thou made me thus?' but of the potter saying to the clay, 'I made you and you must serve me.' " As has been said, the Roosevelt attitude toward ^^the scoundrel who succeeds" was 72 MONOPOLY'S RAPID PACE now greatly modified. In his message to Congress in December, 1901, he discussed the trust question at length. He lost no time in pointing out that the Government had made a serious mistake in adopting the Sherman law as a remedy against monopoly. Among other things he said : "Much of the legislation directed at the trusts would have been exceedingly mischievous had it not also been entirely ineffective. In accordance with a well-knoAvn sociological law, the ignorant or reckless agitator has been the really effective ^friend of the evils which he has been nominally opposing. In dealing with business interests, for the Government to under- take by crude and ill-considered legislation to do what may turn out to be bad, would be to incur the risk of such far- reaching disaster that it would be preferable to undertake nothing at all. The men who demand the impossible or the undesirable serve as the allies of the forces with which they are nominally at war, for they hamper those who would endeavor to find out in rational fashion what the wrongs really are and to what extent and in what manner it is practicable to apply remedies." A mild rebuke, it will be observed, to those eminent statesmen, — Edmunds, Hoar, George, Sherman, and others, — who had given the subject the study of a lifetime. However, Roosevelt had been in office all of 73 THE WRECK two months, and in ^^ rational fashion" had arrived at a solution of the problem. Yet he was shrewd enough not to overlook the fact that there were ^^real and grave evils," for he went on to say : "All this is true; and yet it is also true that there are real and grave evils, one of the chief being over-capitalization because of its many baleful consequences; and a resolute and practical effort must be made to correct these evils. "There is a widespread conviction in the minds of the American people that the great corporations known as trusts are in certain of their features and tendencies hurtful to the general welfare. This springs from no spirit of envy or un- charitableness, nor lack of pride in the great industrial achievements that have placed this country at the head of the nations struggling for commercial supremacy." As time passed he evolved his scheme of ^^ regulation and supervision," which the Smith letter subsequently described to be ^'the policy of the administration," vigor- ously indorsed by the Morgan interests. However, before reaching a definite con- clusion in regard to ^^my policy" Roosevelt indulged in a hasty examination of the Fed- eral Constitution, and in doing so he made a w^onderful discovery. It was this: 74 MONOPOLY'S RAPID PACE "The power of the Congress to regulate interstate com- merce is an absolute and unqualified grant, and without limitations other than those prescribed by the Constitution. The Congress has constitutional authority to make all laws necessary and proper for executing this power, and I am satisfied that this power has not been exhausted by any legislation now on the statute books. It is evident, there- fore, that evils restrictive of commercial freedom and en- tailing restraint upon national commerce fall within the regulative power of the Congress, and that a wise and reason- able law would be a necessary and proper exercise of Con- gressional authority to the end that such evils should be eradicated." Until now it had been supposed that the framers of the Sherman law, being some- what familiar with our great organic act, had followed it quite closely in the work that they had done. In their opinion they had succeeded in exhausting all the constitu- tional power to be found, and all that was necessary now was for the President to en- force the statute that they had written, be- ginning with its first three sections. It must have been a great surprise to them to be told by this novice in statecraft that they had not known exactly what they were do- ing. As Senator Edmunds is said to have 75 THE WRECK remarked to a friend: ^^What meat doth this our Caesar feed upon that he hath grown so great*?'' Roosevelt continued to urge his policy of regulation and supervision, and the Morgan interests continued to commend Roosevelt and back him up. He asked Congress to make provision for a Department of Com- merce and Labor. It did so, and in 1903 the new department was organized. His con- ception of the duties of the department are set forth in his message of December of that year : "It is not designed to restrict or control the fullest liberty of legitimate business action, but to secure exact and authentic information which will aid the Executive in en- foi-cing existing laws, and which will enable the Congress to enact additional legislation, if any should be found necessary, in order to prevent the few from obtaining privileges at the expense of diminished opportunities for the many." Referring to the Bureau of Corporations he said that its purpose v/as ^^not to embar- rass or assail legitimate business." No longer, therefore, was the Sherman law to apply to all corporations organized in re- 76 MONOPOLY'S EAPID PACE straint of trade, but only to such corpora- tions as the President might decide upon as being ^illegitimate.'' Thus did the will of Mr. Roosevelt come to be the law. It was a great deal more than the ^^ transient dicta- torship" spoken of by Guizot: it was an absolute dictatorship, such as all men of Roosevelt's stamp have ever longed to es- tablish. In his message of December, 1904, he felicitated himself and Congress, but more particularly himself, upon the fact that the Bureau of Corporations had made ^^ex- haustive examinations into the legal condi- tion under which corporate business is carried on in the several states, into all judicial decisions on the subject," and as- sured Congress that he would allow it to have such information from the Bureau as might seem to him to be expedient. In other words, as is also made quite clear in the Perkins-Smith letter, the Commissioner of Corporations, under the direction of the President, had superseded both Congress 77 THE WRECK and the law department of the Govern- ment. In a subsequent message, after belittling the importance of the police power reserved to the several states of the Union, he in- dulges in several pages of platitude on the relations that should exist between capital and labor, and, with unusual indefiniteness, reminds the people that they *^owe it to themselves to remember that the most dam- aging blow that can be given popular gov- ernment is to elect an unworthy and sinister agitator on a platform of violence and hypocrisy." Here we have an exhibition of the instincts and practices of the inkfish that may go a great way toward illuminating what some one has termed ^^a confusion worse confounded." The distinction is also made between a worthy and an unworthy agitator ! A year later, while serving his first elect- ive term, the triteness and the hackneyed phrasing in his annual message are depress^ ing. He calls upon Congress to ^^give to the 78 MONOPOLY'S RAPID PACE sovereign some effective power of supervi- sion over their corporate use, ' ' — referring to the fortunes amassed through corporate or- ganization. Surely he could not have been dissatisfied with the size of the contributions collected by Mr. Cortelyou, his campaign manager, in 1904. He goes on : "In order to insure a healthy social and industrial life, every big corporation should be held responsible by, and be accountable to, some sovereign strong enough to control its conduct. I am in no sense hostile to corporations. This is an age of combination, and any effort to prevent all combina- tion will be not only useless, but in the end vicious, because 'of the contempt for law which the failure to enforce law inevitably produces. We should, moreover, recognize in cor- dial and ample fashion the immense good effected by corporate agencies in a country such as ours, and the wealth of intellect, energy, and fidelity devoted to their service, and therefore normally to the service of the public, by their officers and directors." This amounts almost to a confession of failure. Had he not assumed sovereign powers ^ and had not the Congress given him a Bureau through which to exercise those powers ? He had a free hand. No one was restraining him; he was the Government, the sovereign. 79 THE WRECK a I am in no sense hostile to corporations," he says. But what did he mean by ^^the contempt for law which the failure to en- force law inevitably produces"? Had he himself enforced the essential provisions of the Sherman law against ' ' every big corpor- ation'"? Yet ^^we should, moreover, recog- nize . . . the fidelity devoted to their serv- ice [the corporations], and therefore normally to the service of the public, by their officers and directors." What a mystifying web of assertion and contradiction ! In his last annual message, or lecture rather (December, 1908), he continues the stale platitudes that abound in all his state papers. "We no more believe in that empiricism which demands absolutely unrestrained individualism than we do in that empiricism which clamors for a deadening socialism which would destroy all individual initiative and would ruin the country with a completeness that not even an unrestrained individualism itself could achieve." The destruction of ^^ individual initiative" had already been accomplished, its fate 80 MONOPOLY'S RAPID PACE sealed, by Ms own outlawry, by Ms contempt for existing statutes and Ms setting up of a personal government. "The danger to American democracy lies not in the least in the concentration of administrative power in responsible and accountable hands. It lies in having the power in- sufficiently concentrated, so that no one can be held responsible to the people for its use. Concentrated power is palpable, visible, responsible, easily reached, quickly held to account." High-sounding phrase, no doubt, to the ear of the superficial, but, when measured by 'Roosevelt's performances, the merest flub- dub. And the pity of it is that Roosevelt has indulged in so much of this kind of thing that he himself thinks that he is a sincere reformer. Again: ^ "Power scattered through many administrators, many legislators, many men who work behind and through legislators and administrators, is impalpable, is unseen, is irresponsible, cannot be reached, cannot be held to account." Whom did he suspect? Was it Smith, his commissioner? Perhaps it was he, for no one among all the administrators was as 81 THE WRECK close to Morgan and Perkins as Smith was. It could not have been Perkins; it was un- | necessary for Perkins to work behind a gov- $ ernment subordinate when he could go di- rectly to the White House — did go there — and get what he wanted. Ah, with Roose- velt always it has ever been some one else who was to blame, — some indefinite power of evil portent that was preventing him, holding him back! Yet again: "Democracy is in peril wherever the administration of political power is scattered among a variety of men who work in secret, wliose very names are unknown to the com- mon people. It is not in peril from any man who derives authority from the people, who exercises it in sight of the people, and who is from time to time compelled to give an account of its exercise to the people." An open worker was Roosevelt ! Ameri- can public life has not furnished another such. Before him it had never produced a man of his type who succeeded as long as he has succeeded in making the people believe that he could do no intentional wrong. Wherein, then, is the secret of his success 82 MONOPOLY'S RAPID PACE in this regard'? It is in his peculiar hyp- notic ability, in his talent for dissimulation, — the art of concealment, — which is less reprehensible perhaps than arrant hypoc- risy. It must be that in his youth, being a stu- dent of ethics, he readily absorbed the teachings of the early philosophers and re- solved highly to follow them. This was creditable enough, to be sure. But when in his later life he came in contact with human affairs and had to deal with realities his im- pulsive nature clashed with the precepts of his former tutors. Deviation, ever the child of impulse, asserted sway over his singular mind and made him the creature of that ne- cessity which moves the average politician. Underlying these conflicting emotions was a well-developed ego, inherited or acquired — it is no matter. Fortified by his book les- sons on civic virtue, read and reread until they had imprinted themselves indelibly up- on the films of his receptive memory, he pro- claimed them habitually as a rule of action 83 THE WEECK for others, believing that he too was follow- ing them. Now the net result is that we have in the Smith letter and in the messages themselves an interesting exposition of the Roosevelt duality, and of his policy of ^^ regulation and supervision," which had been unconsciously substituted by him for the policy of law embodied in the anti-trust act of 1890. In other words, the law of Congress was set aside by Roosevelt for a law of his own, which conformed more nearly to his erratic conception of public requirements. What did it matter if the gigantic Morgan combi- nations, — the trusts with which Roosevelt was particularly familiar and with the pro- moters of which he was on friendly terms, — what if they escaped the operation of the Sherman law's salient features, provided they appeared to obey the Roosevelt ^4aw''? Out of his studies of the theories of the early philosophers and his unsteady efforts to apply hastily those theories to the practi- cal things of modern times he erected a 84 MONOPOLY'S RAPID PACE shaky standard of action peculiarly his own. To this reed-like structure he sought to anchor our Republican Government. Is it to be wondered at that the ship of state drifted upon the shoals? 85 THE MOEAL EFFECT THE inevitable result of tlie protection which the Morgan monopolies re- ceived at Roosevelt's official hands was the unlawful organization of other busi- ness combinations and the further demorali- zation of competitive activities. The methods of ^^big business '^ have been adopted in many lines, even by the farmers of the country. Prior to the organization of the monopoly which now controls every line of farm ma- chinery the local price of the best grain binders was from $95 to $110, and the farm- ers enjoyed the advantage of healthy com- petition and rivalry among manufacturers and dealers. With the formation of the Harvester trust competition came to an end and the price of binders was sharply ad- vanced. 86 THE MORAL EFFECT At a recent hearing before the legislative grain trade committee in Minnesota Mr. Carl Rakow, a western farmer, gave some interesting testimony. This is the press re- port of the proceeding : "Mr. Rakow said that the International Harvester Company had fixed the price of grain binders at $150, and that this price remains stationary throughout the year, whether there was a market for the machine or not. He wanted the farmers to organize and sell their grain at a fixed price among them, notwithstanding the demand for their produce. ^ " 'If the big business interests charge us stiff prices for what we buy, why shouldn't we charge big prices for what we sell?' said Mr. Rakow. 'It is the only protection we have. If we abolish the chambers of commerce, the grain commission men, and the line elevators, and actually control our own wheat, the farmers will get what is coming to them.' "Mr. Rakow illustrated his point by his own experience last year. He needed new binders. He went to town and a price of $150 was quoted him. All dealers quoted the same price. He went home and decided to fix up his old machines and use them for another year. Then he said the dealer had to store his binders for another year. " 'But,' he added, 'I was able to repair my binders. The people, however, can't repair their stomachs. They have to have bread to eat, and they would be compelled to buy our produce.' "He said that the farmers through the grain belt agreed with his theory, and they were being waked up to the point where they would some day perfect an organization. 87 THE WRECK " 'The farmer himself is responsible for his condition to-day.* continued Mr. Rakow. 'He has not made sufficient investi- gation and study of the grain industry to know how to help himself. I am telling them how to do it.'" Now Mr. Eakow does not undertake to excuse himself by explaining that there are ''good trusts and bad trusts." As he is a plain every-day business man, not given to fine distinctions and preachments, he takes a practical view of the situation and adopts the old proverb that ''what is sauce for the goose is sauce for the gander." Nor does he undertake by the aid of finely spun theories to justify the proposed infraction of law. To the contrary, he comes at once to the crux of the situation and declares his purpose to organize a monopoly in order to equalize the exactions practiced by other monopolies. Whether he succeeds or not is another question ; his intent is no whit different from the intent of the Morgan group of trust pro- moters. No doubt he would say that he favors a "square deal," and his farmer 88 THE MOEAL EFFECT friends would grin their approval. If he, along with Roosevelt, has read moral philos- ophy, like Roosevelt he has not permitted morality to interfere with business. In his testimony before the Stanley com- mittee Colonel Roosevelt, with his usual air of defiance, said that were it to do over again he would disregard the anti-trust law and authorize the taking over of the Tennessee Coal and Iron Company by the Steel trust. ^ If a President of the United States may do such a thing, are we to blame Mr. Rakow, the humble citizen? This Tennessee matter had been investi- gated during 1909-11 by a committee of seven of the ablest lawyers in the Senate. The report of the committee was that ^Hhe President was not authorized to permit the absorption of the Tennessee Coal and Iron Company." This report was signed by Senators Culberson, Kittridge, Overman, and Rayner. Senators Bacon and Nelson, in separate reports, said it was a violation of existing law, — the anti-trust law, — and 89 THE WRECK Senator Poraker for himself found that ''the President had no power to suspend the law, or to authorize or even permit its en- forcement, for it is his duty to execute the law." No doubt Roosevelt's answer to this report would be that nearly all the senators who signed it were ^^reactionaries" and had never been friendly to him; whereupon his blind followers would set up a tremendous cheering. In further evidence of the Roosevelt method it should be stated that while this Senate investigation was in progress Com- missioner Smith of the Bureau of Corpora- tions was called before the committee to testify as to the headway he was making in his Steel trust investigation. This was in Pebruary, 1909. Smith refused to make known what had been done, and being ap- prehensive that the committee might possi- bly take summary steps to compel him to talk, he quickly got in touch with the Presi- dent. The result was that Roosevelt sent a van 90 THE MORAL EFFECT to the Department of Commerce and Labor and had the records of the Smith investiga- tion transferred to the White House and stored away in the attic, where they were kept under guard during the remainder of Eoosevelt's term! The fact of the removal of the records did not become publicly known until after the committee had fin- ished its work. y It will be recalled that the action of Presi- dent Roosevelt in the Tennessee Coal and Iron case was taken when, in November, 1907, having previous advice of their com- ing to see him, he met Judge E. H. Gary and Mr. H. C. Frick, both of the Steel Corpora- tion. They came, it was said, to confer with him in regard to the so-called panic of that year, representing to him that in order to put an end to the money squeeze it would be necessary for the Steel trust to take over the Tennessee company, the greatest rival of the Steel trust, but that they desired to have it understood beforehand that they would not be prosecuted under the Sherman law ! 91 THE WEECK Roosevelt had previously taken the opin- ion of Secretary Root, who assured him that it would be '^a, perfectly legitimate transac- tion"; whereupon the next day the Presi- dent notified Attorney General Bonaparte that he ^^felt it no duty" of his *^to interpose objection." So it is that Mr. Rakow sees no harm in organizing the grain trust, the purpose of which is to increase the price of flour to ninety millions of people. In his report of December, 1911, Secre- tary McVeagh referred to the Morgan money squeeze of 1907 as ^^a gratuitous panic." The secretary's mild designation in classifying it created a sensation among the employees of the Treasury Department, where consideration for the feelings of J. P. Morgan has been very great indeed. To re- flect upon his motives there or even to think of him as being anything short of a high- minded and patriotic citizen was akin to the crime known as Use majeste. It is a significant fact that when Secre- THE MORAL EFFECT tary McVeagli retired from office he was not given a lucrative place in Wall Street, as had happened in the case of most of his im- mediate predecessors. Two months prior to the secretary's report President Taft had ordered that a bill in equity, a civil suit, be fded against the Steel trust. And there- by hangs a tale. It was the beginning of this suit no doubt and the temerity of Mr. McVeagh that helped to seal the fate of Mr. Taft as a candidate to succeed himself, — these and some other things which will be considered in subsequent chapters. The Morgan interests did not forget ^*to fight!" This, in brief, is an uncolored resume of Theodore Eoosevelt's stewardship during the seven and a half years of his administra- tion. It tells the story of his lawlessness; of his disregard for his solemn oath under the Constitution; of his contemptuous atti- tude toward the legislative branch of the Government ; of the suspension of proceed- ings against the Perkins monopoly in farm machinery, Mr. Perkins being his personal 93 THE WRECK friend and a large contributor to his cam- paign fund. In a speech in Boston in the summer of 1912, pressed by a man in the audience to explain his close relations with Perkins, he said that he had never asked Perkins for political contributions; that Perkins had contributed of his own accord because, as he had declared, he favored the economic policy for which Roosevelt stood, — a policy of regulation and supervision of existing mo- nopolies; in other words, the legalization of the trusts; for it stands to reason that should the Government enter upon such a policy it would be equivalent to official rec- ognition of the legitimacy of the trusts. Thus would the past offenses of those who organized them be condoned, their trans- gressions of the law be forgiven, and their vast issues of securities, watered stock and all, — nearly a billion dollars in the case of the Steel trust, — be made lawful for all time, to remain a perpetual tax for this gen- eration and all future generations to pay. 94 THE POLITICAL RESULTS MONOPOLY, as a national institu- tion, is not the only Roosevelt leg- acy to which the American people have fallen heir through the violent and lawless acts of this remarkable man. It is not too much to say that had he done his duty in the thorough and effective way that his supporters in the 1900 convention believed that he would, the two great trusts which he permitted to develop, which he en- couraged by giving them official recognition, would not be in existence to-day, — at least, not in their present oppressive form. The early dissolution of the Steel trust, which was only a year old when Roosevelt took the oath as President, could have been accomplished had he notified the half dozen men who organized it that it was his inten- tion to deal summarily with them, in con- 95 THE WRECK formity with law. And it was not until after it became known that this the largest of the Morgan monopolies was to be per- mitted to continue in its unlawful course that the Harvester trust, the most audacious and vulnerable industrial combination now in existence, was put together by Mr. Per- kins, Mr. Roosevelt's personal and political friend, his present chief supporter. Congress, upon which Roosevelt never ceased to heap contumely and reproach in order that criticism be diverted from him- self, had given the country an anti-trust statute which, had it been enforced as its framers intended that it should be, would have served its purpose well. In respect of the men who conspired in the creation and did create the great monopolies of to-day, the criminal sections, — the real deterring provisions of the law, — have remained a nullity. It was in consequence of all this — exactly as is indicated by Guizot, where he speaks of ^'a terrible and transient dictatorship," 96 THE POLITICAL RESULTS — ^that the Republic has inherited a political hell-broth that will never cease to stew. In his last annual message (December, 1900) "William McKinley spoke these hope- ful, patriotic words: "At the outgoing of the old and the incoming of the new century you begin the last session of the Fifty-sixth Congress with evidences on every hand of individual and national pros- perity and with proof of the growing strength and increasing power for good of republican institutions. Your countrymen wiH^ join with you in felicitation that American liberty is more firmly established than ever before, and that love for it and the determination to preserve it are more universal than at any former period of our history. "The Republic was never so strong, because never so strongly intrenched in the hearts of the people as now. The Constitu- tion, with few amendments, exists as it left the hands of its authors. The additions which have been made to it proclaim larger freedom and more extended citizenship. Popular gov- ernment has demonstrated in its one hundred and twenty-four years of trial here its stability and security, and its efficiency as the best instrument of national development and the best safeguard to human rights." Little did he think that within the next decade a dictatorship would be attempted and the dearest traditions of this ^4and of liberty" for which the fathers wrought would be dealt the blow that deadens; that 97 THE WRECK his successor, professing all the moral at- tributes of all previous Presidents, would so demean himself as to thwart the best en- deavors of an orderly nation and its well- disposed people. After some fashion we may succeed in ridding ourselves of the industrial incu- bus now enciunbering our progress, — the scourge inflicted through the connivance of a malcontent and pretender, — but there is little prospect that we shall ever be able to deliver ourselves of the prevailing night- mare evolved from the antics of a political madcap. Unfortunately, the whole grist of isms and unrepublican devices inspired and in- vited by Eoosevelt's excesses have come to stay. Having found their way, as a result of blind agitation, into the constitutions and statutes of a considerable number of states, they will remain there to turn sane men away from public life and to invite the dem- agog and the ambitious man with suffi- cient means to corrupt a whole common- 98 THE POLITICAL EESULTS wealth ; for this is the inevitable fruit of the propagandas which have led to the referen- dum and recall, the direct election of sena- tors and the popular skirt-dance in politics. It is ^^ progress'' gone mad, — an orgie of the unasylumed. In a word, it is the end of representative government, which James Wilson, one of the f ramers of the Constitu- tion, declared to be ''essential to every sys- ^tem [of government] that can possess the qualities of freedom, wisdom, and energy." He was supported in this view by Mr, Jef- ferson, who, speaking of the ancients and their failures under ''pure democracies said: 11 1 "They knew no medium between a democracy (the only pure republic, but impracticable beyond the limits of a town) and an abandonment of themselves to an aristocracy or a tyranny independent of the people." John Jay, a distinguished jurist who was one of the ablest early governors of New York, described the misfortunes of the dis- tracted people of these very times of ours in this striking language : 99 THE WRECK "Nothing can be more fallacious than to found our political calculations on arithmetical principles. Sixty or seventy men may be more properly trusted with a given degree of power than six or seven. But it does not follow that 600 or 700 would be proportionately a better depository. And if we carry on the supposition to 6000 or 7000, the whole reasoning ought to be reversed. The truth is that in all cases a certain num- ber at least seem to be necessary to secure the benefits of free consultation and discussion, and to guard against too easy a combination for improper purposes; as, on the other hand, the number ought at most to be kept within a certain limit in order to avoid the confusion and intemperance of a multi- tude. In all very numerous assemblies, of whatever character composed, passion never fails to wrest the scepter from reason. Had every Athenian citizen been a Socrates, every Athenian assembly would still have been a mob." Madison laid down this infallible rule by which to maintain the only kind of repre- sentative democracy: "The representation should be large enough to guard against the cabals of tlie few and small enough to guard against the confusion of the multitude." Measuring the estimate he appears to have placed upon the exalted position of Presi- dent of the United States by his own clown- ish conduct, the belief that Roosevelt is a man of ability and learning is open to 100 THE POLITICAL RESULTS some modification. A man may be able and yet dangerous when entrusted with public responsibilities. He may be learned in a scholarly sense, but if he uses both his nat- ural and his acquired talents to the injury of his country then verily is he a doubly dangerous person. Eoosevelt has done all this. As has al- ready been asked, did he do it uncon- sciously "? If so he must be possessed of a perverted mind. But what is the degree of his mental abnormity "^ The answer does not belong here ; it is not the province of this volume to invade the field of the alienist. Should it turn out that he is an object of government rather than one to have been trusted with government, perhaps the mis- guided men who assisted in foisting him upon the people in the first instance are equally objects of commiseration. As one of these misguided individuals, the writer hereof has not escaped nor does he hope ever to escape his proportion of hu- miliation and blame. The best he may do 101 THE WRECK is to acknowledge having committed a very great error. The deception arose in conse- quence of what at the time seemed to be a pressing public duty; for along with many others he realized the near approach of per- ilous days for the Republic, and thought he saw in this rising young man, who spoke so fairly, all the elements of honest leadership, — the qualities which make for and guaran- tee equal justice for rich and poor, for weak and strong alike. He mistook claptrap and wordy professions of virtue for promising signs of statesmanship. Simply this and nothing more. Monopoly, only a shadow looming threat- eningly in the distance in the fateful year of 1900, is now a power too great for even the Government to contend with in the hope of overthrowing it, unless by the interposi- tion of a miracle. This is the legacy which Mr. Roosevelt has left us. No one who has given the subject atten- tion and is familiar with the inner workings of the Washington machine can have any 102 THE POLITICAL RESULTS doubt that had Roosevelt called onto the White House carpet when he became Pres- ident the leading trust offenders of that time and told them that ''by the eternal" it was his intention to enforce the first three sections of the Sherman law, whether he be- lieved in them or not, the nation would have been saved from its present embarrassment. ^ It was for this duty that he was put for- ward as the vice-presidential nominee at Philadelphia. The delegates who favored him, doubting not his capacity and integrity nor the existence of ample law under which to do this duty, believed that he would jus- tify their expectations. They were doomed to disappointment. He adopted the deceptive course of railing at the trusts in the open and taking their or- ganizers and promoters to his breast behind the scene. Sad as it may seem, it has come to be ex- pected that wherever Roosevelt goes and whenever he talks,— which is frequent enough, — he invariably exhibits his peculiar 103 THE WRECK man of straw, without which he would be most uninteresting. True, the improvised dummy has just enough vitality in it to ad- mit of its being unmercifully slugged. Roosevelt is seldom specific in his attacks, unless he has managed to select some help- less unfortunate as his victim, as he did in the case of poor old General Tyner. He is always at his best when, having assembled all the errors, imaginary or real, to which humanity is heir, he succeeds in making the multitude believe that all the faults of man- kind are combined in the single object of his assault. And when he has delivered his diatribe one is obsessed by a feeling that the whole world is bad beyond redemption, and will continue bad to the bitter end unless Roosevelt himself is called to redeem it. Is it not the role of the public bully with all the variations that belong to the insin- cere man, — to the athlete, self -trained in the acrobatics that pertain to a personality capable of changing itself at will to suit the occasion? Was it for this that John Har- 104 THE POLITICAL RESULTS vard came over from England to establish the now famous college at which our doughty reformer was matriculated ? It must be that our European friends who heard him on his return from Africa asked themselves this question many times. He had been to the dark places of the globe, there to give vent to the throbbing ferocity of his nature by slaughtering innumerable inoffensive wild animals. He found a de- gree of personal pleasure in it that we are still left to hope may have its compensatory rewards. The hides of the animals that he killed are in a museum for the curious to wonder at. But are we soon to outlive the unfavor- able impression he made abroad when as a former President of this Eepublic he ex- ploited before several learned bodies his varied talents as a preacher of righteous- ness at the expense of our own considerable store of integrity? To cultivated minds it must have been difficult enough to avoid the inference that while he was absent from the 105 THE WEECK United States a whole year killing big game his countrymen were without any protection whatsoever from their own iniquities. With their usual courtesy and accus- tomed politeness, the foreigners, always considerate of this nation and its men of prominence, dismissed the incident with the general verdict that the former President seemed to be given ^Ho the artful display of platitudes." And no wonder, after this specimen of his preachment at the Sor- bonne in Paris : "Woe to the empty phrase-maker, to the empty idealist, who, instead of making ready the ground for the man of action, turns against him when he appears and hampers him when he does the work!" a Mark the insinuating use of the term empty phrase-maker!" Had Roosevelt been hampered during his reign at home^ Had not Congress and the people given him a free hand? His auditors, however, must have thought the reverse to be true. He said further: 106 THE POLITICAL RESULTS "Moreover, the preacher of ideals must remember how sorry and contemptible is the figure which he will cut, how great the damage he will do, if he does not himself, in his own life, strive measurably to realize the ideals that he preaches for others." An unconscious self -indictment no doubt ! At wliom other than himself could he have been aiming'? Yet, to use a colloquial phrase, ^^it listened good," at least to the Rdosevelt ear. To the Sorbonne scholars undoubtedly it was a platitude. Intellectual France remembers the inci- dent only to challenge the soundness of our consistency. Two years after the Roose- velt performance in Paris, Rene Doumic, writer and Academician, had this to say about it: "It is by no means seldom that American thinkers instruct the Old World noisily in lessons which come strangely from their mouths. Thus two years ago ex-President Roosevelt, on his return from Africa, where he had just killed what lions Tartarin had left, gave in the official Sorbonne a lecture in which he laid down virtuous commandments for France in purposely rude and aggressive terms. What, then, was our surprise at the American Presidential election to find the whole campaign turned against the furious corruption which rules in all the administrative departments of the United States!" THE WRECK In his own country, however, where Roosevelt has continued and promises to continue his peculiar style of preaching; where political results are aimed at, the mat- ter takes a wider range, and his vocabulary finds greater variety. When revolving in his home orbit his language is something more than platitudinous ; to be at all effect- ive it must rise to the explosive point and seethe with invective, such as ^4iar," ^^scoun- drel," ^^ crook," and the like. Yet we who have come really to know him have accustomed ourselves not to tremble in physical fear. It is conceded in advance that all who do not agree with him are ^^undesirable citizens." As time passes the number of these seems to be growing larger. It is a distinctive Roosevelt trait to as- sume that when he does or says a thing it is the act of a man who cannot be mistaken, and that only ^^ crooked people" will ques- tion his motives. Here again we have the familiar practice of the bluffer, who seeks 108 THE POLITICAL EESULTS to demoralize his opponent by making a bold rush to the center. That the author of this brief historical sketch is not alone in his estimate of Roose- velt 's character, as it revealed itself during his public career, the following very suc- cinct and accurate pen picture of the man is submitted, — an editorial from the New York World under the caption of ^^ Bluffed to a Standstill," written about the time Roosevelt became a candidate in 1912 : "Who would have thought one year ago that Theodore Roosevelt, as President and as man, would see this day free from Democratic criticism, free from arraignment by any respectable political agency and free from the necessity of making a defense of anything that he has done or left un- done? If anybody ever bluffed the American people to a standstill he is entitled to that distinction. "How has he done it? Not by deeds, but by words. Not by reason and argument, but by assertion and denunciation. Not by sincerity and truth, but by caprice, exaggeration, and recklessness. Not by single-mindedness and patriotism, but by impudence, arrogance, and shrieking hypocrisy. "He had great and admitted wrongs to contend with. He merely blustered and threatened. He had powerful criminals to punish. He ignored most of them, and by his violent methods made the administration of justice in the case of others almost a nullity. He inveighed mightily against 109 THE WEECK malefactors and undesirable citizens. He nevertheless enter- tained some of them in the White House. He demanded law and more law for the punishment of wealthy offenders. He then suspended law in the interest of the Steel trust. He preached peace and good-will. He practiced big-stickism and extravagance in war expenditure. Boasting of righteousness in himself and commending to others obedience to law, he used his great power to elevate favorites to high rank, to punish and pursue opponents with mean revenges, to deny to some men the protection of the law and to advance the idea that the executive and judicial departments might properly over- ride Congress, Constitution, and people. Scolding his country- men on matters of morals, deportment, and taste, he has given them an exhibition during this campaign of ill-behavior never before witnessed in the Presidential office. "This is the record. These are the false standards that he has established. This is the evil example that he has set for the young. These are the brutal assumptions that he has managed to carry away unchallenged by any authoritative political or popular protest. It is a remarkable showing of undisciplined fury in one man and of meek submission in millions of men equally free. "Personally he is to be congratulated upon his immunity. Collectively the people are to be commiserated because no Democratic champion has appeared in their behalf to enter so much as a complaint." The trouble with Eoosevelt when he had the power to punish the perpetrators of the great wrongs against which he strenuously inveighed was that he managed to shield those offenders whose bank accounts ap- 110 THE POLITICAL RESULTS peared to his mind large enough to outweigh their sins, — an invitation to the unscrupu- lous to go on offending so long as the wrong- doing produced more revenue for himself and his favored friends. It must have been for some such conduct as this that even Satan rebuked Belial. Unless life in general is one huge joke and all reformers of the Roosevelt stamp merely actors, the time may yet be when a serious and just-minded people will see a movement in the interest of an uplift in society that will be genuine and enduring. In that case it will be necessary to begin at the bottom and build toward the top, instead of violating the law of moral gravity by constructing downward with hypocrisy as a starting point. Ill PART II FOUR YEARS OF TAFT PART II FOUR YEARS OF TAFT COMPARED with the turbulent reign of Roosevelt, the four years of Taft in most respects were as a peaceful outing in blossoming Maytime, — not exactly a cessation of hysteria, but a most welcome diminishment in it, — a prom- ising period of much needed repose. To aU outward appearances nothing dis- turbed the large, serene, good-natured, and well-disposed man who was President from 1909 to 1913, and who, seemingly, had a jolly time of it during the greater part of his term. In reality, however, his path was not strewn with roses ; like the rest of mankind he had his heartaches. The contrast between Roosevelt and Taft was very great; the contrast between their 115 THE WEECK respective administrations, greater still. Yet, in the matter of results accomplished, there was a close resemblance. Each in its own way was both destructive and disap- pointing. It was not on account of a lack of knowl- edge of the duties of the office that Roose- velt failed; it was because of an imperious disregard for the law, for the moral tone and traditional dignity that belongs to the position, because of the inordinate vanity of the man himself, because of his persist- ence in alone occupying the spotlight. Taft's failure was largely due to his un- fortunate conception of the principles of the party whose leader he was; and in a measure to very poor judgment in the mat- ter of important appointments when the course to pursue, from a political point of view, Avas as plain as a pikestaff. He had the misfortune also to surround himself with party advisers who knew as little about the necessities of the party as he did. It is always in order to play good politics well, 116 FOUR YEARS OF TAFT but those who had the confidence of the President and advised him politically ap- pear to have made him believe that it was wrong to indulge in any kind of politics. The circumstances under which Mr. Taft came to the Presidency were unusually pe- culiar. It is generally known, of course, that he preferred a place on the Supreme bench, for which he is eminently fitted. He is favored with the judicial mind, but, un- like Benjamin Harrison, who also would have made a great judge, he was a stranger to the arts of the politician, even in the best sense of the term. Harrison was a born statesman as well. He possessed to an ex- ceptional degree a firm grasp of the judicial, the legislative, and the executive functions. Taft was always the judge, and took the jurist's view of things. It is to be regret- ted that he did not await a vacancy on the Supreme bench. Instead he permitted himself to be put forward to occupy a posi- tion for which he was sadly imfit. It would be an unusual man, however, who would 117 THE WEECK pause for self-examination or who, should he do so, would reach an accurate conclusion in regard to his own qualifications for an J office such as the Presidency. In this particular instance Mr. Taft did not hesitate. How readily he yielded, not j so much to ambition perhaps as to the neces- sities of the situation, — as Roosevelt saw it, — ^may be judged by the sudden turn that Republican politics took in the early spring of 1908. Up to tliis time Taft was only a tentative candidate. A self-constituted committee of five sena- tors had been laboring with President Roosevelt to secure a pledge from him that he would stand for a '^ second elective term." The truth must be admitted that these senators were playing politics, — ^bad politics as it now appears, — and for once found Roosevelt ready to listen. Had he insisted upon doing the talking as usual, they would have been more confident. As the seemmg necessities of the case were un- 118 FOUR YEARS OF TAFT folded, however, lie became quite enthusias- tic. Notwithstanding Roosevelt's unexpected course in befriending the Morgan interests, — although even at that date only a few of the wisest insiders knew how close he was to those interests, — he seemed still to be the most popular and available man in the party. In a moment of excessive exuberance on the night of his election in 1904 he had is- sued a statement that he would not be a can- didate ''for a third term," quoting impres- sively from Washington's farewell address. In the campaign of 1912 he saw fit to ex- plain that he meant ''a third consecutive term." To the committee of five he said that he would leave the matter entirely in their hands; that he would not interfere with their efforts to secure his renomination, but would say nothing, conveying to their minds the impression that he w^ould accept if when 119 THE WRECK the time came it seemed the thing to do. That was all they asked. They would easily manage the rest of it. Much to their disgust, within thirty days from the date of that statement he renewed his declaration of four years before that he would not be a candidate. This put an end to the efforts of the committee. But, as al- ready said and as the public is aware, he changed his mind in 1912 and decided to take what Doctor Abbott has been pleased to term '^a third cup of coffee." Secretary Taft was not the only member of the Roosevelt cabinet who had Presi- dential aspirations. George B. Cortelyou, Secretary of the Treasury, sought the place, and while Mr. Taft was waiting for Roose- velt to decide his fate Mr. Cortelyou was making a vigorous but very stealthy can- vass for the support of Southern delegates. Having served as chairman of the national committee in the Roosevelt campaign of 1904, his familiarity with the Republican machine, especially with the methods in 120 FOUR YEARS OF TAFT vogue in securing delegates from the South, was of very great advantage to him. It was understood, too, that his candidacy was agreeable to the Morgan interests, whose close connections with the Treasury Department were maintained through Sec- retary Cortelyou, as had been the case under former administrations. So close indeed were these connections about the time of the Panama Canal bond issue that Mr. Till- man, in a heated speech in the Senate, charged Mr. Cortelyou with having favored the Morgan house, to which the bonds were sold at a price below that of other respon- sible bidders. Senator Tillman's speech was never fully answered. By this time the Cortelyou quest for dele- gates had reached the serious stage, and President Roosevelt hastened to announce and did announce his decision in Mr. Taft's favor. That the candidacy of the sphinx- like little man of the Treasury portfolio should have made such headway without the knowledge of the White House management 121 THE WEECK was a great surprise to the politicians in Washington, who whispered their specula- tions to one another without wondering what it meant, for they knew its import. When ^^ Billy" Loeb, the President's im- perturbable yet watchful secretary, was questioned on the subject he answered with a dark, troubled look that it wasn't at all likely that his chief intended that the po- litical leadership in New York should pass out of his hands in such easy fashion, — not to George Bruce Cortelyou, between whom and the Roosevelt regime relations were now somewhat strained. Roosevelt himself showed evidence of personal annoyance. The truth is that neither he nor Mr. Taft had been fully aware of Mr. Cortelyou 's po- litical activities. The vague press reports concerning the Cortelyou candidacy had not impressed them, but now that the cat was out of the bag something must be done and that without delay. Accordingly, a hurried council of a few of Mr. Taft's friends was held at the White 122 FOUR YEARS OF TAFT House, after which a member of the cabinet went post-haste to New York. On his re- turn the political situation assumed a decid- edly new complexion. Frank Hitchcock, First Assistant Postmaster General, a friend and protege of Mr. Cortelyou, was then in the South, ostensibly on department l)usiness but in reality on a j^olitical mission in behalf of Mr. Cortelyou. In response to an imperative order from the "White House he returned to Washington and resumed his official duties. Events moved rapidly forward. A repre- sentative of the house of Morgan came over from New York to take part in the readjust- ment of preconvention affairs, with the re- sult that Mr. Cortelyou gave way to Mr. Taf t and accepted the presidency of the Consoli- dated Gas Company of New York, a Morgan corporation, at a salary of $25,000 a year. The Southern postmasters with whom Mr. Hitchcock had been negotiating were noti- fied that they would be expected to support Mr. Taf t instead of Mr. Cortelyou. In mat- 123 THE WRECK ters of this kind the gentlemanly politician from the South is never greatly disturbed by pride of opinion. All he wants is a ^^sure winner," — one who will not break patron- age promises. Now it would be unjust to Mr. Taft not to explain that in accepting the assistance of the Roosevelt machine he incurred no obligations to the powerful financial and industrial system that has its headquarters in New York. He was grateful to Colonel Roosevelt of course for what he had done to further his candidacy, and when he came to the Presidency he proved his grati- tude by appointing several of Roosevelt's friends to lucrative positions. Mr. Loeb was made collector of the port of ISTew York, and Messrs. Meyer and Stim- son were given places in the cabinet. Mr. Ballinger, whom Roosevelt had induced to give up his thriving law practice on the Pacific coast and accept the Commissioner- ship of the General Land Office, was pro- moted by President Taft to be Secretary of 124 FOUR YEARS OF TAFT the Interior. Thus another Roosevelt ad- herent was cared for. Mr. Pinchot, ar- dently admired by Mr. Roosevelt, was re- tained at the head of the Forestry Bureau until his acts of insubordination obliged the President to ask for his resignation in order to maintain himself in self-respect. Until then the relations between the former President and Mr. Taft had con- tinued on a basis of cordiality, and Repub- licans were looking hopefully forward to the time when the two leaders would again join hands for party success. Disappoint- ment awaited them. Smarting under his rebuke and bubbling over with ^'progres- siveness," Mr. Pinchot proceeded to Rome, where he met the returning hunter and poured out his grievances ad libitum and ad infinitttm. The Roosevelt ire was aroused; for had he not selected Mr. Taft to be his successor? This fact admitted of no dispute; it was a matter of common knowledge. Why, then, should not the Government forester be permitted to over- 125 THE WRECK ride the President if need be in order to carry out the Roosevelt ^^conservation policy," wliicli by this time, as many be- lieved, had developed into a sort of fetish? To what extent the Pinchot matter con- tributed toward Roosevelt's subsequent po- litical actions is of no great consequence, save that it is conceded to have opened the way to the final break that came with start- ling force in 1912. But this was not the sole cause of the rupture. Nor will the po- litical psychologist undertake to fathom the Roosevelt mind to determine the depths of his ambition. When Mr. Taft was slated as the Roose- velt candidate in 1908 it was generally sup- posed that he would follow the Roosevelt plan in dealing with certain trusts. This supposition found support in the readiness with which the Morgan interests acquiesced in the arrangement whereby the Cortelyou delegates were shifted to Mr. Taft. But, as has been said, Mr. Taft made no pledges to his political patron or to the patron's 126 FOUR YEARS OF TAFT patron, — the Morgan syndicate. He ac- cepted the honor as any true American would, without binding himself to a pro- gram. Doubtless his conception of the duties of the position was that the chief executive of an orderly nation is not to assume the role of a dictator over the two other branches of government, — the legislative and the ju- dicial. It was enough to have the constitu- tional prerogative of expressing his views through messages to the Congress and of enforcing the laws. If the tenor of these views and acts departed from the practices of his predecessor the fact would be ac- cepted as evidence that he had determined upon a line of policies of his own, for which his administration alone would stand re- sponsible. Mr. Taft did not depart from the gen- eral policy of his predecessor, however ; yet a gentler tone pervaded his messages. It was a grateful relief to the country. On the trust question he said in his first annual 127 THE WRECK message that the developments in the oper- ation of the law called for discussions and suggestions as to amendments, and that he would avail himself of the first convenient opportunity to bring the subject to the at- tention of Congress. A year later (De- cember, 1910) he said: "I do not now recommend any amendments to the anti- trust law. In other words, it seems to me that the existing legislation with reference to the regulation of corporations and the restraint of their business has reached a point where we can stop for a while and witness the effect of the vigorous execution of the laws on the statute books in restraining the abuses which certainly did exist and which roused the public to demand reform. If this test develops a need for further legislation, well and good; but until then let us execute what we have." A straightforward and concise expression of official opinion, devoid of platitudes, un- attended by sermonizing or vague insinua- tions that Congress had neglected its duty. He recognized the fact that abuses *^cer- I tainly did exist" and that the public had been roused ^^to demand reform." He showed the most generous consideration for 128 FOUR YEAES OP TAFT Mr. Roosevelt by putting the blame upon the monopolies themselves. Nor did he differentiate between the ^^good'' and the ^^bad''; he played no favorites. In this respect he did depart somewhat from the policy of his predecessor, whose administration throughout had been de- voted to the protection of two notorious trusts. As to these Mr. Taft's mind was entirely open. But the time came when he decided that the Steel Corporation was a monopoly in restraint of trade, and he brought suit to compel its dissolution. That he did not proceed criminally against the men who organized the Steel trust was due no doubt to the fact that when he came to the Presidency the courts had before them the important Standard Oil and To- bacco cases. Here his judicial mind pre- vailed. He knew that the final decisions in these cases would be of an epoch-making character; that in all probability the court would fix the status of the trust in the eye of the law against combination. 129 THE WEECK As to the contributing causes which led to the sundering of the former friendly re- lations existing between the two party lead- ers, one no doubt was the incident resulting in Mr. Pinchot's retirement from the Bu- reau of Forestry, which he had succeeded in raising from a mere departmental division to an elaborate and expensive service that promised to supplant even the great gov- ernmental branch of which it was in law only nominally a small part. That the filing of the bill in equity against the Steel trust in October, 1911, was the principal cause of the rupture there can be little doubt. This was the causits helli. In the language of Mr. Perkins, already quoted in the Smith letter, '^it after all the endeavors of this company [the Harvester monopoly] and the other Morgan interests to uphold the policy of the administration [referring to the Roosevelt administration] this company was now to be attacked, the interests he represented were going to fight," and, as Mr. Smith himself concluded, 130 FOUR YEARS OP TAFT ''the mere refusal of the Steel Corporation to give information except at the end of a lawsuit . . . would be the first step in the fight.'' At the date of the initial proceeding in the Steel trust suit Mr. Taft was not aware of the threat that had been made by Mr. Perkins, for the Smith letter was a confi- dential conmiunication to Colonel Roosevelt while he was President and was not made public until the office copy of it came from the private files of the department in re- sponse to a Senate resolution during the campaign of 1912. It is doubtful, how- ever, if the Perkins threat would have de- terred Mr. Taft even had he known about it. Another interesting fact is that imme- diately upon the filing of the Steel trust suit Colonel Roosevelt allowed himself to get exceedingly busy in a political way. About this time he received several visits from Mr. Perkins at Oyster Bay. At once the mistakes of the President, — they were not 131 THE WRECK few, — were seized upon by the Roosevelt following, to be exploited industriously in hostile publications. Colonel Roosevelt took personal charge of the campaign and wrote many letters to political leaders, — those having grievances against the Taft administration. The first pronounced movement in the interest of his third term candidacy was the meeting of the ^^ seven governors" in New York and Roosevelt's significant reply to them. Thereafter the contest grew rapidly to proportions that portended the certainty of a bolt at the Chicago convention. On the side of Colonel Roosevelt campaign funds soon came to be very abundant, and long before the Taft machine could be or- ganized for effective work Messrs. Perkins, Flynn, Munsey, and other opulent cru- saders who hastened to Armageddon had as- sembled a working force beside which the Taft contingent resembled a little confer- ence of threadbare missionaries. With the dexterity of the trained organ- 132 FOUR YEARS OF TAFT izers that they were, the Roosevelt leaders enlisted the services of an army of experi- enced Republican politicians, leaving Taft dependent upon a small number of ad- herents of doubtful efficiency. As has been said, it was Mr. Taft's mis- fortune to have surrounded himself with men having little or no experience in the field of politics, and strangely enough he rejected the advice and proffered aid of those who had made party management in the largest sense a lifelong study. It was as if he had gone to sea in a leaky ship with a crew of landlubbers who would be in great luck indeed if they succeeded in running the vessel on a rock. In any event the conse- quence was disaster to the party, and the surprise is that Mr. Taft even got the nom- ination. The gentlemen who conducted his press bureau had some practical knowledge of the necessities of the campaign, and had they not been hindered and handicapped by the ''management" a much better showing 133 THE WRECK would have been made. The President himself seemed sadly bewildered, and while he and Chairman Hilles were holding con- ferences on the Mayflower far out at sea Roosevelt, Perkins, Flynn, and other bull moose sappers and miners, under the ex- pert direction of Senator Joe Dixon, the astute politician and mixer, were in the midst of the fray on land where the voters were. In this situation the Democrats had but to rest on their oars and wait for elec- tion day for the certainty of success. 134 SOME TARIFF BUNGLING UT the defeat of the Taft ticket and the disaster visited upon the Repub- lican party were not due alone, as many suppose, to the extraordinary con- duct of Theodore Roosevelt, or to Mr. Taft's indorsement of the Payne- Aldrich law, or to both these things combined. It all came about in consequence of the Presi- dent's unexpected and inexplicable depar- ture from deeply rooted party principles; in other words, his fathering of the tariff project known as Canadian reciprocity, which was grossly misnamed, for there was no reciprocity in it. It was this departure from Republican policy that made the Roosevelt candidacy possible. Mr. Taft invited it, uncon- sciously no doubt. Had he known as much of politics as McKinley knew or as Harrison 135 THE WRECK and Blaine knew, or had he first taken the opinion of a few practical politicians and followed their advice, both he and his party would have escaped the drubbing they got in 1912. It is possible that they might not have escaped defeat, but it would not have been an overwhelming defeat. Undoubtedly a strong sentiment existed in favor of a ^^ downward revision of the tariff," and it is also true that the framers of the law of 1909 might have gone further than they did in that direction. Still it was a Republican tariff law, in some re- spects an improvement upon the Dingley act, in many other ways far from being what the country really demanded. On the whole, however, it followed the lines of pre- vious protection measures and in addition contained some new provisions which were afterward used to the advantage of domes- tic industry. For Mr. Taft to have vetoed or even to have withheld his signature from the bill would have brought about a division in his 136 SOME TARIFF BUNGLING party of far-reaching consequences. Yet, within less than a year from the date of his Winona speech, in which he said the Payne- Aldrich law was the best tariff measure ever enacted, he called Congress together in extra session to repeal some of its most salient provisions, — to remove the duty in tofo on all products of the farm coming in from Canada, the most considerable pros- pective competitor of domestic agriculture. Republican leaders throughout the coun- try were amazed. To strike suddenly and directly at the interests of more than eleven million farmers; to propose the removal of the whole of the duty of thirty cents a bushel on wheat and place all other grains on the free list, together with dairy and other farm products, was something that no one familiar with our tariff history could comprehend. Of course the Democrats might be ex- pected to support the proposition, as it gave rise to serious dissension in Republican ranks. The spectacle of William Howard 137 THE WRECK Taft and Champ Clark advocating the scheme from the same platform at the same hour would have been humorous had it not been so very serious to the cause of Repub- licanism, whose faithful adherents could but exchange regrets and turn to their party archives to ascertain if really they were not dreaming. Could this be the man who less than three years before had received 321 out of 483 electoral votes as the candidate of the party of protection? — ^who had carried almost every grain-raising state in the Union? Was the American farmer, whose material interests had been so long and so valiantly upheld by James G. Blaine and William McKinley, to be sacrificed? Where was the party warrant for this strange proceed- ing? Had it been demanded in any Repub- lican platform? Was it in consequence of a sudden uprising of the people against the well-settled doctrine of protection to Amer- ican industry? Assuredly it was not. Having freed the slave, naturally enough 138 SOME TARIFF BUNGLING the further mission of the Republican party was to put the nation on a revenue basis, — that is, to provide the statutory machinery whereby to encourage the development of the country's resources. It was agreed among the Republican leaders of those days that the most speedy means by which to bring this about was in the enactment of laws embodying the principles of a pro- tective tariff. This policy, as party history proves, had been fully outlined and advocated in Re- publican platforms and as energetically condemned by the Democrats. It had been consistently carried forward, however, un- til the inequalities that always creep into tariff laws. Republican and Democratic alike, created that revulsion in public feel- ing which resulted in the election of Mr. Cleveland in 1884. Emboldened by their partial political success, the Democrats, with the tariff again the issue, asked the people for full responsibility, promising the complete overthrow of protected privilege. 139 THE WEECK The voters did not respond affirmatively. In 1888 the pendulum swung back, with the result that in 1890 a most comprehensive protection measure, — the McKinley law, — was enacted. Before the full effect of this law could be felt, and as a result of systematic agitation, a Democratic minority was transformed into a working majority. In 1894 the Wil- son-Gorman law, which was neither ^^fish, flesh, fowl, nor good red herring," found its way to the statute book. Hard times fol- lowed this effort at tariff tinkering. Whether the business depression that came to pass was well founded or not will per- haps continue to be a matter of dispute. The fact remains, however, that the Amer- ican people reversed the Government's eco- nomic policy in 1896, since which time the protective principle has prevailed. Eeference to these historical events at this time is necessary in order to emphasize the fact that the majority of the people are inherently in favor of judicious protection, 140 SOME TARIFF BUNGLING equally distributed to benefit every line of industry. Revolts against the principle have been solely in consequence of its abuse. The demand for ^^ downward revision" in 1909 was based upon the popular belief that conditions, — the hugeness and the growing power of certain protected industries, — called for a scaling down of duties, not for a complete reversal of our fiscal policy. This being true, the course of the Taft administration in 1911 in putting forward the one-sided and altogether unique pro- gram of '^reciprocity" with Canada has not ceased to be a source of surprise and sor- row. Mr. Taft's sincerity has never been questioned ; it was his amazingly bad judg- ment that will always be regretted by the great majority that gave him valiant sup- port in 1908 and particularly by those loyal Republicans who refused to desert him in 1912. This was his first and undoubtedly his greatest political blunder, and it took the heart out of the campaign for his reelec- 141 THE WRECK tion. Taft himself may survive it, but Ms X)arty never. That he should have allowed himself to be led into making this egregious mistake is one of the incomprehensible things in politics. Surely it could not have been his own original idea, for he is not given to whimsicalities. It is easv to understand how, with his superficial knowledge of tariff matters, he could have been misled. Yet it is difficult to realize how he came to indorse a scheme which, while it freelisted the products of the farm, retained protective duties on all manufactures. Of course the selfish ele- ment in New England wanted it ; to them it meant an extension of the list of free raw materials. The Steel and Harvester trusts wanted it. They wanted it because the profits on the sale of their goods in Canada, where for the most part they are the agents for their own products, would be increased by the exact amount of the tariff reductions proposed by the Dominion. As the Amer- ican manufacturer has practically no com- 142 SOME TARIFF BUNGLING petition in Canada, there would be no corresponding reduction of the prices which the Canadian consumer must pay. The merest tyro in tariffs would have seen this at a glance. As an instance of the abuse of the pro- tective system, New England demanded and got free hides in the interest of cheaper shoes ; yet with free hides the price of shoes went up. So too would it have been had the Canadian agreement become law; with farm products on the free list the price of manufactured articles would have remained the same. From the standpoint of fairness no sub- stantial objection can be made to an ar- rangement for absolute free trade between Canada and the United States as to every class of products, but alas ! such an arrange- ment would not be acceptable to certain of our manufacturers. Thus is protection made the instrument of selfishness rather than of common benefit. It is this sort of thing that has brought the institution into 143 THE WRECK I disrepute, turning even its friends against it. ISTo one appears to know who first Mt upon the idea of this strange brand of ^^reciprocity." It has been suggested that perhaps it was evolved out of the exigencies of politics in Canada. Also that it was conceived in the masterful brain of James J. Hill, who has some twenty branch lines of railway which he is ready to push across our northern boundary. There is profit in the long-haul, with tariff dues abolished ! According to still another theory, it is said that Secretarv Knox, as an offset to the offensive and defensive alliance between England and Japan, sought through this trade pact to win the Canadians away from the home government and make them our friends in case of a war between the United States and Japan, — a piece of diplomacy that is almost incredible. Yet even this may find justification in the pressing neces- sities of ^^big business." Mr. Hill's purpose to extend his numer- 144 SOME TARIFF BUNGLING ous branch roads into Dominion territory, the Dominion guaranteeing the interest on the construction bonds, has some substance in it, for it is in line with his policy of em- pire building. But that it should be neces- sary to inflict a loss upon the American farmer in order to advance the interests of a railway corporation already fat with do- mestic prosperity seems unreasonable. It was pointed out, of course, that the domestic farmer would not be injured. This argument was used by both President Taft and Mr. Hill, the one speaking in Cin- cinnati at the same hour that the other spoke in Minneapolis. But it is a singular coincidence that the market reports of the great dailies which printed these speeches showed a declme of ten cents a bushel in the price of wheat at Minneapolis, the result of the pact proposal, and that it did not rise to normal protection figures until after Canada had voted down the scheme. Under protection the domestic price of farm products has always been higher than 145 THE WRECK the price for the same products in Canada. Another significant thing was that during the pendency of the agreement, with wheat decidedly lower, the price of flour remained stationary; nor did the poor man's loaf come the least bit cheaper. Here the American millers' trust, which was strong for reciprocity, had its innings and scored heavily. It was upon the petition of the millers five or six years prior to this that Secretary Shaw and Attorney General Moody set aside the drawback law so as to allow the free importation of Canadian wheat. Their plans were thwarted, however, and the integrity of the law was preserved by a combination of circumstances which the millers' trust failed to overcome. In a larger way the reciprocity project was a repetition of what had been proposed by those who sought to nullify the draw^back law. The movement for reciprocity was 146 SOME TARIFF BUNGLING further stimulated by the claim that if the products of the Canadian farmer were brought mto the United States free of duty the problem of the high cost of living would be solved, and the friends of the Knox- Laurier pact lost no opportunity to pro- claim this as a great discovery. Precisely the same experiment had been tried in 1850, and after ten years of unsatisfactory results the scheme was abandoned. In proposing a return to the rejected policy of fifty years ago it was claimed that conditions had changed; that the time had come for ''the cementing of more friendly relations with Canada by closer commercial intercourse." The sympathy and assistance of the American press had been enlisted by in- corporating a clause in the pact providing for the free admission into the United States of the pulp of wood and news print paper. Hence the flood of favorable com- ment in the daily press, the magazines, and other periodicals, whose bills for paper at 147 THE WRECK constantly increasing prices, which, of course kept pace with the increasing weight of the Sunday edition, was a strong argu- ment against '^the high cost of living," and in favor of ^^the cementing of closer rela- tions with our northern neighbors." But there was one class of publications, — the farm journals, — that did not take kindly to the proposition. They were not slow to see and to say that while reciprocity might be a good thing for the manufacturer it was a singular fact that the farmer had been selected to *'pay the freight." To the disinterested observer it looked very much as if the promoters of the pact had done a lot of mighty fine figuring ! To Republicans who held fast to the protection faith that was in them it seemed as if Presi- dent Taft had permitted Secretary Knox to carry his ^^ dollar diplomacy" policy to the point of disaster. The disaster came in November, 1912, when the Republican national candidate lost every Republican state along the Canadian boundary line save 148 SOME TARIFF BUNGLING one, and this one, — ^Vermont, — lie carried by the insignificant plurality of something like 900 votes. But for this tariff blunder on the part of the Taft administration it is doubtful whether Colonel Roosevelt would have thrown his hat into the ring. While it did not justify the bolt at Chicago, the reci- procity incident made Taft's reelection im- possible, and the Roosevelt candidacy did not matter. No blame attaches to the party for what happened, and had Mr. Taft con- sulted the party leaders generally, instead of following the advice of a half dozen gentlemen afflicted with political provincial- ism and infeasible ideals, it is doubtful if he would have taken the fatal step. True, the scheme was immediately in- dorsed by Colonel Roosevelt and other so- called '^Progressives,'' but when the mighty hunter, his political ear always to the ground, heard the loud protests from the fields, he quickly changed round, say- ing that '^ having looked into the matter 149 17 THE WRECK lie had found that Taft was wrong, — a somewhat belated admission that he him- self was in error when he delivered his three memorable speeches in favor of the project. However, those speeches were made at a time when the whole comitry, through a well-baited press, seemed to favor it; when Mr. Taft's close advisers were ex- ultingly claiming that he would sweep the country on the reci^orocity issue. For had not even the Democrats indorsed it! Although the Canadians had rejected the agreement prior to our Presidential elec- tion, the American farmer did not forget to use his vote to express his opinion in regard to the i3roposal that he should bear the whole burden of this new kind of tariff re- duction. He remembers even now the teachings of Blaine and McKinley, who never overlooked the importance of con- serving the home market to the tillers of the soil. In his *' Twenty Years in Congress" Mr. Blaine made the prediction that when the 150 SOME TARIFF BUNGLING Republican party so far forgot its obliga- tion to the American farmer as to take from him his due proportion of protection it would go out of politics. After writing these prophetic words Mr. Blaine came to be one of our most distinguished Secre- taries of State, where he was called upon to consider our trade relations abroad, partic- ularly with the Pan-American countries. In his time he was the foremost advocate of reciprocity, but not the kind that would make our own farmers the victims of the free list. To his mind even the suggestion of such a suicidal course would have been repellent. The attitude of McKinley on the question of trade agreements is summed up in a single sentence. In his last public address, —his Buffalo speech,— he said that reci- procity was ''the natural outgrowth of our wonderful industrial development under the domestic policy now firmly established" (referring to the doctrine of protection). But he laid down this rule of procedure,— 151 THE WRECK that ^^we should take from our customers such of their products as we can use with- out harm to our own industries and labor.'' This is genuine reciprocity. How few there were in 1911 who distin- guished between the brand of reciprocity that Blaine and McKinley believed in and that proposed by Mr. Taf t ! It is to be re- gretted that there were so few publishers who were willing to admit the difference. Could it have been on account of their per- sonal interests in securing to themselves the supposed benefits of free wood pulp ? Admittedly, the press is a mighty force in shaping public opinion, but that it should be thus used to selfish ends detracts exceed- ingly from the noble profession of journal- ism. In recent years this formidable | power has been unduly exercised, illustra- ting in a variety of ways the evils of the pre- vailing tendency to combination in all lines of business. A combination of newspapers and other publications to achieve pecuniary results of 152 SOME TAEIFF BUNGLING advantage to the ^^ business office" is quite as reprehensible as is the organization of an industrial monopoly, so freely de- nounced in editorial columns. The framers of the Sherman law, out of an abundance of caution no doubt, did not undertake to deal specifically with the matter of a pos- sible trust of publishers. A monopoly of editorial opinion was a thing scarcely to be conceived of. Yet it has come to pass. Even a President of the United States, before embarking upon a voyage on the sea of public policy, has deemed it advisable, in the interest of his doubtful enterprise, to ^^ throw a sop to Cerberus." The friends of the pact real- ized that in order to succeed with the jug- handled scheme it would be necessary to hold out the inducement of cheaper news print. As a further illustration of the hypocrisy of the times, it is no misstatement of fact to say that the seemingly righteous demand for the modern election devices, such as 153 THE WEECK the direct primary, the initiative, the refer- endum and the recall, has been greatly stimulated by the concessions made to local editors by local politicians for the more elaborate publication of profitable election notices and the printing of tons of political literature. Profit, always profit of a ma- terial kind! A more recent example of the demoraliz- ing and hypocritical attitude of the pub- lisher politicians is found in the program of denunciation adopted by the metropoli- tan newspapers that protested so vigorously against the payment by them of just and equitable rates of postage on the train loads of advertising pages which are carried by the Government at enormous financial loss to the people. And what do the people get in return *? ^^Free speech!" answers the subsidized press, — ^Hhat is, the freedom of the press is maintained, which is the same as free speech for the people." Was it in the interest of free speech to stifle pub- lic opinion in regard to Taft reciprocity? — 154 SOME TARIFF BUNGLING to force editorial trust opinion down the public throat "^ We shall read much during this extra session of Congress about ^^ sugar senators." It may not be amiss to keep an eye out for pulp publishers. Here in the United States we indulge in extravagant denunciation of ''the barbaric methods of Eussia" because it maintains a place of exile for those who conspire at the destruction of the political and social struc- ture of the empire. Yet, in this land of '^free speech" we truculently cater to such conspiracies, trusting to a credulous and easily bamboozled public to condone the sins of our false teachers; with the result that these same sins not only go imcor- rected but, through lax custom, they grow into national virtues. The unexampled record of the lawless Eoosevelt is a case in point. As to Mr. Taft there are some mitigating circumstances. After designing men with selfish interests to serve had set the reci- procity trap it was pointed out to him that, 155 THE WRECK being in need of a popular issue, by spring- ing the trigger promptly lie could reduce the high cost of living and gain great credit for his administration at a single stroke. It was a seductive proposal. Even the chance of reducing the high cost of living was a sufficient incentive to stir any man to action. There were many theories in regard to the cause and a variety of remedies were proposed. What at times seem to us to be our great- est troubles are often explained away in the simplest fashion. It was recently dis- covered that Chicago housewives pay ten cents a head for cabbages, while down in Texas large quantities of this excellent vegetable are rotting in the fields. Would not this indicate that there is something wrong with our system of distribution "? There is no duty on cabbages between Texas and Chicago! Only a short while ago onions sold at fifteen cents a pound at Laredo, Texas. Just outside of the city the grower was re- 156 SOME TARIFF BUNGLING ceiving two cents a pound. Who got the 650 per cent, profit '^ Potatoes went to w^aste last season in the fields about Cum- mington, Mass. In Worthington, a near- by town, they were selling at $1.50 a bushel. These and many other facts that may or may not belong to the ^^ deadly parallel'' order came out recently at a meeting of the National Conference on Marketing and Farm Credits, where one of the delegates said that ^^ somebody else is getting the money for nearly everything that farmers grow.'' The secretary of the Consumers' League, conducting an exhibition at St. Louis to demonstrate adulteration of foods, said that pineapple and lemon pies as they come from many bakeries consist of artificial flour paste, glucose, benzoic acid, and coal tar dye ; that apple tart was mostly timothy seed and anodyne dye made from bitumi- nous coal refuse, while chocolate icing was composed of artificial flour paste, glucose, 157 THE WEECK benzoic acid, and burnt umber dye, and that some baking powders were made by grind- ing white stone to fine dust. Surely pineapples, lemons, and the good old orchard fruit of our boyhood are plen- tiful and cheap enough in first hands, so that these practices cannot be explained on any other ground than that those who perpetrate such wrongs are a part of the conscience- less system that manipulates the prices of the necessaries of life; and it must be that these in their turn are only following the example of the gentlemen who have made enormous fortunes organizing the big mo- nopolies. Now in such conditions it would seem to be the part of wise statesmanship to deal first wdth the greater offenders, — those who set the evil example. The parent who would correct the bad morals of the child would begin by separating him from de- basing influences, pointing out the danger- ous consequences of corrupt associations. To effect a cure it might be necessary to 158 SOME TARIFF BUNGLING inflict condign punishment upon the orig- inal transgressor. But for the flagrant conduct of the ^*big brainy men" who have saddled the people with $35,000,000,000 of fictitious interest- bearing securities it is doubtful if the food adulterers and other lesser malefactors who have found a way to cheat the consuming public would have had the hardihood to prosecute their illegal traffic. It was the greater offenders against the law and ^^ common decency," concerning which Colonel Roosevelt has had so much to say and against which he accomplished practically nothing, who set the pace for the army of little crooks of commerce now in- dustriously at work, — who conceived the fraudulent scheme of reciprocity in their own selfish interest. That President Taft did not realize the purpose of it, — that he should have per- mitted himself to be misled, — is to be re- gretted. Harrison, McKinley, and Blaine would have seen at a glance what it meant 159 THE WEECK to their party, for they were practical poli- ticians; and practical politics is closely allied to practical statesmanship. A knowl- edge of both is necessary if a President is to succeed and leave his party intact at the end of his term. 160 MORE BAD POLITICS BUT the reciprocity blunder was not the only serious political mistake made by Mr. Taft while he was at the head of national affairs, and for which the Eepublican party is now ^^in sackcloth and ashes." There has been a singular disinclination among politicians to discuss the appoint- ment of Edward D. White to the position of Chief Justice of the Supreme Court of the United States, for the reason perhaps that it involves a sectarian question. Poli- ticians are extremely wary in regard to matters of this knd ; yet almost every voter in the country has expressed his opinion about it. Now it is not the purpose of the writer to enter upon the question of the right or wrong of this act of Mr. Taft's, save as 161 THE WEECK , it concerns party politics. The author hereof concedes the eminent fitness of Chief Justice White, whose personal friend he is. Not every one has agreed with the conclu- sions reached in some of the distinguished jurist's opinions, but no one will deny that he has a very profound and conscientious legal mind. In this regard President Taft made no mistake. From a political point of view, however, he showed his usual poor judgment, antag- onizing as he did the very large Protestant element of the country, and in addition dis- pleasing the veterans of the civil war. The answer to this will be that those who by their votes expressed their objection to Justice White's preferment are very nar- row-minded and bigoted citizens. Perhaps so; yet the fact remains that the ap- pointment created widespread feeling of re- sentment, and therefore its influence in the last Presidential campaign was very great. For this reason it stands against Mr. Taft as the leader to whom the interests of 162 MORE BAD POLITICS the party had been entrusted. The inci- dent could have been avoided by the ap- pointment of Justice Harlan, who was in line for the place. Public sentiment, par- ticularly party sentiment, was on the side of the grand old American jurist. He was, besides, the choice of a great many eminent members of the bar, who had no doubt about his qualifications. As has been suggested, it is not Mr. Taft alone who is left to suffer for such things; the great Republican party has been more than equally the victim. In the elevation of Justice White, as well as in the matter of so-called reciprocity, Mr. Taft seems to have proceeded without any thought of his party's welfare. When he became the Re- publican candidate the party was in a most prosperous political condition. He left it in a situation of pitiable helplessness, from which recovery wiU be tediously slow. Had Roosevelt and Taft conspired to- gether for the overthrow of the great or- ganization which gave them all they ever 163 THE WRECK had of political recognition, they could not have hit upon more effective methods of de- struction than the ones that each of these distinguished men saw fit to adopt. 164 TAFT AND THE TEUSTS IN" some other respects, however, Mr. Taft rose quite to the heights of states- manship, and his analysis of some im- portant court decisions and their applica- tion to present conditions proves his very great ability as a lawyer. It must not be forgotten that he suc- ceeded to the duties of President in very trying times. As has been so often said, Roosevelt was a hard man to follow. Throughout his long lease of power he stirred the popular imagination until it be- came a ferment of uncontrollable passion. At the end of his service the public mind was in a state of revolt, — Mexicanized and vengeful. By winking at criminal infractions of the law, Roosevelt had managed not only to in- crease the country's ills but to leave the im- 165 THE WEECK pression that they were due to the corrupt practices of indefinite persons and to forces so potent that he had been unable to subdue them. The people were impatient for the realization of the reforms which he had art- fully outlined but had never secured. When Taft came in the courts were gorged with suits the pleadings of which were replete with doubtful terms. Among them were the cases against the Standard Oil and the Tobacco trusts. An examina- tion of the record in these cases raises in the mind of the close casuist a question of doubt as to the entire sincerity of their instigators. They were the product of able lawyers, it is true; yet, after reading Justice Harlan's dissenting opinion, one is impressed with the thought that here and there the pleadings were lacking in vitality, whilst in other parts they appeared to be packed with confusing redundancy. However, Mr. Taft had nothing to do with the pleadings nor with the appeals. The Government's case had been fully made 166 TAFT AND THE TRUSTS ■up before lie came to the Presidency. The future attitude toward monopoly was now in the hands of the Supreme Court, and the administration could but await the decision of that tribunal in the Standard and To- bacco cases before proceeding against the Steel, the Harvester, and other trusts. Mr. Taf t makes this fact quite clear in his message of December, 1911. He says: "In May last the Supreme Court handed down decisions in the suits in equity brought by the United States to enjoin the further maintenance of the Standard Oil trust and of the American Tobacco trust, and to secure their dissolution. The decisions are epoch-making and serve to advise the busi- ness world authoritatively of the scope and operation of the anti-trust act of 1890. The decisions do not depart in any substantial way from the previous decisions of the court in construing and applying this important statute, but they clarify those decisions by further defining the already admitted exceptions to the literal construction of the act. By the de- crees they furnish a useful precedent as to the proper method of dealing with the capital and property of illegal trusts." It has been said that the court by intro- ducing into the construction of the statute common-law distinctions has emasculated it. Mr. Taf t says that this is obviously un- 167 THE WRECK true, for ^'hj its judgment every contract and combination in restraint of interstate trade ... is condemned by the statute." He goes on to declare that ^'the most ex- treme critics cannot instance a case that ought to be condemned under the statute which is not brought within its terms as thus construed." He emphasizes his views thus: "The test of reasonableness was never applied by the court at common law to contracts or combinations or conspiracies in restraint of trade whose purpose was or whose necessary- effect would be to stifle competition, to control prices, or to establish monopolies. The courts never assumed power to say that such contracts or combinations or conspiracies might be lawful if the parties to them were only moderate in the use of the power thus secured and did not exact from the public too great and exorbitant prices. It is true that many theo- rists, and others engaged in business violating the statute, have hoped that some such line could be drawn by courts; but no court of authority has ever attempted it. Certainly there is nothing in the decisions of the latest two cases from which such a dangerous theory of judicial discretion in en- forcing this statute can derive the slightest sanction." So that, from Mr. Taft's point of view, the decisions in the Standard and Tobacco cases do not weaken the Sherman law; they 168 TAFT AND THE TRUSTS ^^ clarify" it. This brings Hm to the crim- inal sections of the statute: "Only in the last three or four years has the heavy hand of the law been laid upon the great illegal combinations that have exercised such an absolute dominion over many of our industries. Criminal prosecutions have been brought and a number are pending, but juries have felt averse to convicting for jail sentences, and judges have been most reluctant to impose such sentences on men of respectable standing in so- ciety whose offense has been regarded as merely statutory. Still, as the offense becomes better understood and the com- mitting of it partakes more of studied and deliberate defiance of the law, we can be confident that juries will convict indi- viduals and that jail sentences will be imposed." This statement is very significant. It raises the question of moral conduct on the part of judges and juries and holds out the hope that as offenses ^ ^become better under- stood" ^^ jail sentences will be imposed." It also admits that some courts ^^have been most reluctant" to impose jail sentences ^^on men of respectable standing in so- ciet,y." Thus we come to the very crux of the argument made by Commissioner Smith in his confidential letter to President Roose- 169 THE WRECK velt, wherein the Commissioner, a subordi- nate executive officer of the Government, as- sumed to decide beforehand that the men who had organized the Steel and the Har- vester trusts were not guilty of criminal wrong-doing. Doubtless Mr. Smith, upon investigation, had found them, to be ^^men of respectable standing in society," and in this view he appears to have been sustained by President Eoosevelt. The num.ber of criminal prosecutions be- gun and the number of indictments found during the four years of Taft were far in excess of those under all previous admin- istrations. Many of these cases are still pending, and several hundred thousand dol- lars have been paid in fines imposed in the discretion of the court. On the whole it would seem, as Mr. Taft has suggested, that in recent years judges and juries are coming to realize that the framers of the Sherman law knew what they were doing. The record shows that except under the Roosevelt administration 170 TAFT AND THE TRUSTS no violators of the law have enjoyed any undue leniency on the part of Government officials. That the Morgan interests did find a friend in President Roosevelt admits of no kind of doubt. That these interests turned their guns on President Taft when in conformity with his oath of office he brought suits against them is equally true. In summing up, Mr. Taft expresses this very clear view of the intent and purpose of the anti-trust law : "The complaint is made of the statute that it is not suf- ficiently definite in its description of that which is forbidden, to enable business men to avoid its violation. The suggestion is that we may have a combination of two corporations, which may run on for years, and that subsequently the Attorney General may conclude that it was a violation of the statute, and that which was supposed by the combines to be innocent then turns out to be a combination in violation of the statute. The answer to this hypothetical case is that when men at- tempt to amass such stupendous capital as will enable them to suppress competition, control prices, and establish a monopoly, they know the purpose of their acts. Men do not do such a thing without having it clearly in mind." Manifestly there can be no kind of doubt that the men who organized the Steel Cor- 171 THE WRECK poration knew ^^tlie purpose of their acts." The purpose was to ^^ control prices and es- tablish a monopoly." They did not fully succeed in this until Roosevelt suspended the Sherman law and permitted them to absorb their Tennessee rival. Since then their power in maintaining prices has been omnipotent. The example they have set be- fore the business world is equally reprehen- sible. George W. Perkins knew ^^the purpose of his acts" when in 1902 he persuaded the McCormicks, the Deerings, the Lisners, and other independent manufacturers of farm machinerv to combine and establish the Harvester monopoly. He knew ''the pur- pose of his acts" when, in order that he might evade the statutes and decisions in regard to *^ manufacture" and ^^distribu- tion" by one and the same corporation, he organized the International Harvester Company ^^of America" to sell and distrib- ute the articles manufactured by the Inter- ' national Harvester Company of New Jer- 172 TAFT AND THE TRUSTS sey. The two corporations were organized and are still controlled by identically the same men. This is the same Perkins referred to in Herbert Knox Smith's confidential letter to Eoosevelt ; the same Perkins with whom President Roosevelt directed Mr. Smith, his Commissioner, to confer; the same Perkins who was 'Agoing to fight" if the Govern- ment disturbed his monopoly; the same Per- kins who did fight the Taft administration because it cited him and other Morgan mo- nopolists to court, — the same one indeed who is now financing the bull moose up- lift ''in the interests of future generations." Meanwhile the Harvester monopoly has driven all rivals to the wall and paid a $20,- 000,000 stock dividend in this generation; and Perkins is still fighting,— fighting for the kind of regulation and supervision that Roosevelt gave him from 1902 to 1909. 173 MR. WILSON AND HIS PARTY IT is too early to venture even an opinion concerning President Wilson's admin- istration. It will be judged largely by the tariff law whicli is now in process of making. A year or two hence we shall know more about it. Notwithstanding the flood of assertion in regard to the dominance of ^^progressivism" in the Democratic party as at present constituted, one is impressed with the close resemblance it bears to the Democracy of other days. As a whole it still clings to the revenue theory in tariffs, while not a few of its members, — a larger number than formerly, — ^lean heavily to- ward protection. Like divisions appear to prevail in regard to the currency and to foreign policy. As to that other disturbing problem, — the rule of monopoly, — it would be as difficult to 174 MR. WILSON AND HIS PARTY find any Democratic member of either house of Congress who is not outspokenly against the trusts as to pick out a Repub- lican or a so-called Progressive who is not also opposed to them. Yet. notwithstand- ing this unanimity of feeling on the sub- ject, no one has come forward with a prac- tical remedy for the country's greatest evil. The legacy left by Roosevelt, who blew both hot and cold on the trust question, seems to be accepted as an unwelcome be- quest by an overgenerous philanthropist. It will be a courageous statesman indeed who will assume responsibility for amend- ing the Sherman law, and a fortunate one who succeeds in enforcing it to the letter. As to the spirit of the law, — with the growth of monopoly during the past dozen years and the blunted sensibilities of the people in regard to it; with the apathetic conditions resulting from the non-enforce- ment of its deterring provisions and conse- quentty the aggressive arrogance of the foremost monopolists themselves, — in this 175 THE WRECK sorry situation the present administration will find but little of the original spirit in it. Whether a way can be found to revive it, to restore the teeth so dexterously drawn by Doctor Roosevelt, is a task that will tax the ingenuity of Doctor Wilson. In case the administration decides that the anti-trust law must be amended in order to make it effective the striking out of a few words in each of its three first sections might greatly simplify matters. There is the danger, however, that even were the discretionary clauses in regard to fines eliminated it would be necessary to re- construe the entire statute, and this means almost endless litigation. Indeed the mo- nopolists themselves are believed to be look- ing hopefully forward to any sort of amend- ment of the law. It would be worth a bil- lion dollars a year to them if it could be sent back to the courts, for the trusts know the value there is in the law's delay. The change from a Republican to a 176 MR. WILSON AND HIS PARTY Democratic regime brought an interesting character to the White House. Woodrow Wilson has already demonstrated that he has an abundance of courage. As yet not even the closest students of politics have been able to decide whether it is the right sort of courage. It is not the militant brand that Roosevelt's admirers still be- lieve that he possesses. Therefore it is not the furious, the violent kind. Nor is it of the subdued order. Mr. Wilson wears the air of one having complete confidence in himself. He is moved by a quiet energy, an alertness that is in distinct contrast with the loggy bearing of Mr. Taft. True, their physical propor- tions are widely dissimilar. Again, Mr. Taft's most striking feature is his set smile; Mr. Wilson merely looks pleasant. The pictures of him do not do him jus- tice. The intellectual, almost soulful, light that illumined his face when he read his tariff address to Congress — it was not a message — has never revealed itself to the 177 THE WRECK camera at special sittings. Should it hap- pen that the artist who is to paint his portrait for the White House gallery shall be fortunate enough to catch him in this mood, instead of the homely man portrayed in the newspapers and in studio windows Mr. Wilson will take rank among our hand- somest Presidents. As for statesmanship it is evident that he must remain a psychological study for some time to come. A hasty estimate of his capacity in this regard cannot be made with a satisfactory degree of accuracy. A well- known journalist who came on to attend the inauguration asked a member of the press gallery : ^'Whatisheliker^ ^^He is not like anything else we ever had here," was the answer. ^*Is he steady or is he eccentric, — hyster- ical or phlegmatic, arbitrary, dictatorial, or calm and yielding'?'' urged the anxious and curious visitor. ^^He's all of them in one, but I am at a 178 MR. WILSON AND HIS PARTY loss to find a name for it," replied the gal- lery scribe. When an experienced newspaper man fails to classif}^ a new President the case is almost hopeless. Eventually no doubt it will be found that Woodrow Wilson has a normal temperament; that he is the com- plete master of self, studiously honest, ex- ceptionally methodical, and that he is in no danger of being spoiled by the adulatory arts usually exercised toward the man in the White House. It is already quite definitely settled that he is a gentleman and a scholar, and that he is to maintain his position on a plane of respectful dignity in keeping with the serious business of government. He gave a suggestive hint in this direction in his in- troductory remarks on the 8th of April when he broke a precedent of more than one hundred years' standing and went to the Capitol to deliver his tariff address in per- son. He said: 179 THE WRECK "Mr. Speaker, Mr. President, Gentlemen of the Congress: I am very glad indeed to have this opportunity of addressing the two houses directly, and thereby verifying for myself the impression that the President of the United States is a person, and not a mere department of the Government, hailing Con- gress from some isolated island of jealous authority, sending messages instead of speaking with his own natural voice; in short, that he is a human being, trying to cooperate with other human beings in a common service. Hereafter, after enjoying this pleasure and privilege, I shall feel absolutely normal in all our dealings with one another." The neatness and simplicity of tMs state- ment won the admiration of the thousands who had gathered in the chamber and in the galleries of the House to witness the unusual proceeding. More than this, in a measure it explained the reason of the Democratic party in having selected Mr. Wilson as its candidate. To use a phrase of his, it is quite evident he does not think that ''life consists in eternally running to a fire.'' In the matter of policies, however, at the very outset the President has assumed a most difficult task. He is to be commended for advising with his party leaders on the tariff. Being an apt student, he will learn 180 MR. WILSON AND HIS PARTY a great deal. He will find that the tariff question does not belong in the category of the exact sciences. The tariff has been the cause of the undoing of many great men, and if Mr. Wilson escapes this fate he will be very much more fortunate than any of his predecessors. He must know even now that he cannot escape, and for this reason he should be given credit for having that pe- culiar courage which enables him to take, along with his party associates, his full share of responsibility. He is too wise even to hope that his party will succeed in making an absolutely just tariff law. In the present state of society such a thing is impossible. Strangely enough, neither of the existing political organizations stands for a just tariff. Exact justice in tariff matters is surely to be found somewhere between the line of Republican policy and the line of Demo- cratic policy. On the part of the Republicans the mak- ing of tariff laws has been a matter of 181 THE WEECK barter and trade, one section of interests yielding to another section of interests, until, as Mr. Wilson said in his address, ^^we long ago passed beyond the modest notion of protecting the industries of the country and moved boldly forward to the idea that they were entitled to the direct patronage of the Government.'' On the other hand the Democrats, whose political necessities have seldom met with financial encouragement from the protected industries, have felt that expediency re- quired them to resort to oratorical violence in denouncing the * iniquitous institution." The result is that the two parties have gotten themselves farther and farther apart on the tariff question, each recogniz- ing all along that it was on unstable ground. It must be that Mr. Wilson had this sit- uation in mind during the last campaign when he said repeatedly that '^the Govern- ment's fiscal system cannot be materially changed." Under all these circumstances, if it were possible for him to bring about a 182 MR. WILSON AND HIS PAETY compromise tariff, — a just tariff, — he would write his name far up on the scroll of fame. But alas ! such a thing is impossible, even if Mr. Wilson favored it, — which may be doubted, judging from recent daily press reports. It is impossible because the House leaders have decided to stick to the old Democratic text of ^'a tariff for revenue only," although they must know that the country will reject such a tariff at the very first opportunity. A factional disagreement in the Demo- cratic party, the outgrowth of pique and thwarted ambition, seems as difficult of ad- justment as a household disturbance in which the opposing forces are mutually hopeful that some good neighbor will drop in and play the part of pacificator. Woe, then, to the pacificator ! This being the case, the time has come to write ^^ finis" to this story, lest its author be mistaken for the good neighbor with pacificatory intentions. The President saved himself much immediate trouble in 183 THE WRECK this respect by delegating to Ms cabinet ministers the selection of their subordinates, holding the head of each department re- sponsible for its administration. Time will tell whether he is yet to regret his course in this regard. As suggested in an earlier chapter, the predatory interests have their experts whose particular business it is to prey upon the Government through pliant officials. No matter what party is in power the ^^puU'^ is always the thing. This is the in- visible government concerning which the general public have little knowledge. It works secretly, and we do not know of the full scope of its operations until it is too late, or until we read that the superservice- able officials, at the end of their term, have gone to New York and taken places there or elsewhere with the trusts at princely salaries. The Treasury Department in Washing- ton is always the object of trust solicitude; and it is a remarkable fact that no Treasury 184 MR. WILSON AND HIS PARTY administration in this generation, unless it was Mr. Taft's, has been free from Wall Street or corporate connections. Not even Mr. Wilson's has escaped, new as it is. It was the hope of many sincere friends of Mr. Wilson that he would avoid this awkward complication by going far away from Manhattan Island for his Secretary of the Treasury. But he did not do so. Mr. McAdoo may turn out to be an excep- tion. However, his environment for many years back is against him. Environment is a potent force. Almost the first act of Sec- retary McAdoo was to choose his assistant secretary from corporation circles. John Skelton Williams is a member of the Mil- lionaires' Club, the president of a railway company, of two banks, and a leading fi- nancial light generally in the mysterious Interlocking System whose control extends to every line of industry worth while. Do the necessities of the Treasury De- partment really demand the services of this particular Mr. Williams'? Or is this kind 185 THE WRECK of tiling ^^tlie new freedom" we've been reading about ? If so it may not be a great while before we shall need a new broom. It is here, perhajjs, that President Wilson's fine courage will show^ itself. Should it turn out that mistakes have been made in organizing the Treasury or any other De- partment the country will expect Mr. Wil- son to correct them. Still, it is a most difficult matter to meas- ure the forces of endurance in the Demo- cratic party. It would seem to thrive best on blunders. Wrecks are only a tonic to it. If anything could put an end to its exist- ence possibly it would be too much reform. After all, Mr. Wilson may be a far-seeing man. He may realize that future party success depends not so much upon the pro- gressiveness loudly proclaimed during the campaign as upon the more substantial things that give politics its effective punch. We shall see. 186 104 80 ^x. ^ * ^^<^ A > • • • -O^ / ^- 0' i 0" * *.r '^. r.-\?. ' INDIANA 46962 m A^ A^ ,.. '''^_ -VJ~0 O N ^^.x"*