ROBBER BARONS

AGAIN THE ROBBER BARONS

WHILE busy carving up the country into baronies, overrunning the social capitals, penetrating the schools and the churches, the captains of industry worked also with unremitting vigilance in the field of political action.  Here public opinion, as it accepted the pecuniary doctrines of the railway or industrial magnate, seemed also to welcome his penetration, through the government, into the highest assemblies of the country :  the Congress, the Senate, and even sometimes the President’s cabinet.

The masters of business who sat in the upper chamber of Congress (or “Millionaires’ Club,” as it was humorously called), or their close associates who became Representatives or governors of states, make up a long and distinguished roll which, to mention only a few, includes Leland Stanford of the Southern Pacific monopoly, George Hearst, the gold-mine owner ;  Chauncey Depew, president of the New York Central, and Henry B. Payne of the Standard Oil family ;  William Sharon and James G. Fair, the Nevada Bonanza kings ;  Stephen B. Elkins, mine-owner and railroad operator, and William A. Clark, the Montana copper baron.  Further, among the professional politicians there were also shrewd former tradesmen or lawyers, such as James G. Blaine, Nelson Aldrich, bankers and ironmasters, such as Marcus Alonzo Hanna, James Cameron, and after them Penrose, Platt and Foraker.  Furthermore the opposing party, the “outs,” were like the Republicans, who were usually the “ins,” also led by masters of business or corporation lawyers.  August Belmont and Samuel Tilden stood high in the leadership of the Democratic party at an earlier period, as did W.C. Whitney, Henry B. Payne, and James Hill in the time of Grover Cleveland.

It would seem that every industrial group and every great monopoly was almost directly represented in the political councils of the nation, the better to “enrich themselves and the country,”  On the whole, the practical policies they advocated were carried out with much persistence and loyalty ;  and though the general program  they pursued seemed paradoxical, it was crowned with success.

Paradox arose from the existence of democratic institutions, universal suffrage, equality before the law and equality of privileges.  The masters of industry, though imperialists in their daily business, were confronted with democratic and individualistic lawmaking bodies and their judiciary and police departments.  They quickly developed a technique for dealing with the democracy.  Having virtually completed the conquest of the nation’s resources and possessed themselves of lordly properties or seized the “narrows” of trade, the barons were thereafter most happy to advocate complete laissez faire within the nation.  They were uncommonly eager to have existing private-property rights sanctified and protected by all the authority of the country.  Having won extraordinary economic privileges in the conduct of their business, they saw no objection to leaving to the people at large the residue of individual liberties and rights ;  they would keep the whole charter of so-called popular liberties intact.  Finally, as a fiscal policy for the nation they advocated a “sound currency”;  to “raise the standard of living” they successfully urged the protective tariff ;  and to keep marauders of other races or colors away, to safeguard both here and abroad their growing investments, they generally insisted upon a big navy.

In nearly all sections of the country the masters of capital or their lawyers showed at first an obvious enthusiasm to become the doges of the republic.  In California the campaigns of the Pacific quartet, for measures useful to the Southern Pacific, for the election of Stanford as governor or Senator, were all carried on in the open, with gold coins flung among the crowd at the polls.  In Ohio the campaign for the elevation of Henry B. Payne to the Senate in 1884 was conducted in the back rooms of saloons, whence an “inundation” of greenbacks spread over the state, gold being less common east of the Rockies.  In the mountains of Montana, several years later, a deadly duel raged between two copper barons, Marcus Daly and William A. Clark, each of whom aspired to the Senate, both purchasing newspapers and poisoning the public mind against each other, until at last after a decade of exhausting combat Clark went to Washington and all was tranquil again.

Yet, as Mr. Andrew Mellon observed one day to Colonel George Harvey :  “It is always a mistake for a good business man to take public office.”  Direct intrusion of the masters of big business, while it seemed logical in measure with their stake in the society, often proved unfortunate.  Thus Henry B. Payne by his ingenuous procedure in the Senate called down upon himself the anger of his fellow tribunes.  Again and again when bills were introduced aiming at railroads or monopolies—though without serious chance of being enacted—Mr. Payne would stand up and cry monotonously :  “I object !”  On one occasion he even read into the records his own public eulogy of the Standard Oil ;  so that the other Senators were beside themselves with vexation at his crude tactics, and one of the worthiest of their body arose in anger, saying :

A Senator who, when the governor of his state, when both branches of the legislature complained to us that a seat in the United States Senate had been bought ;  when the other Senator from the state arose and told us that was the belief of a large majority of the people of Ohio . . . failed to rise in his place and ask for the investigation which would have put an end to the charges, sheltering himself behind the technicalities which were found by gentlemen on both sides of the chamber . . . I should think forever after would hold his peace.

Among the Pacific Associates a quarrel arose toward 1885 between Huntington the generalissimo and Stanford the political “front,” when Stanford had himself elected Senator in place of Huntington’s friend, A.A. Sargent.  In 1890 Huntington forced Stanford to resign the presidency of the Southern Pacific in favor of himself.  Then in a statement to stockholders Huntington declared :

In no case will I use this great corporation to advance any personal ambitions at the expense of its owners, or put my hands into the treasury to defeat the people’s choice . . . If a man wants to make a business of politics, all well and good ;  if he wants to manage a railroad, all well and good ;  but he can’t do both at the same time.

All these were heavy darts aimed at Stanford.  Huntington did not object to the defense of the Southern Pacific’s political interests.  On the contrary no one labored so unremittingly and brilliantly as he in this very field.  The point at issue, as Stuart Daggett has said, was whether the occasion for defending the railroad politically should be used to advance the personal interest of an individual, or his own public glory.  General politics in itself was stuff and nonsense to Huntington ;  and he felt that Stanford by growing absorbed, even in a moderate degree, had neglected his duties to the Southern Pacific.

For the long run, to effect the great ends which all the barons clearly held in common there were much better ways than that of having themselves elected to public office :  there was a method, a technique of political action, comprehensive though devious, “Machiavellian” or “jesuitical”;  and its secret principles may be pieced together from the less guarded scraps or fragments of expression of the barons.  Or, as in the case of Collis Huntington and John Archbold of the Standard Oil, the grand design for a manual or lexicon of political art in a capitalist democracy can be composed from their voluminous private correspondence, which has been so fortunately preserved in each case.

Though the representative institutions of the republic had developed the political tradition of a two-party alignment with presumed differences of principle between the two, the barons as a class actually showed no sentimental allegiance to one as against the other over a long period of time.  In its early days the “radical” Republican war machine, flushed with its triumphs, had seemed to attach to itself the strongest personages in the country.  In 1872, Clews tells us that he rallied all his fellow brokers to the support of General Grant because “Wall Street business would boom.”  In 1880 the ineffable Henry Ward Beecher was for “God and Garfield !”  But in the case of Grant’s election Clews holds that even “the leading Democrat merchants and bankers in different parts of the country are anxious that the Republican Party may completely triumph.”  The words of Gould, that in every election or district he was “for Erie,” right or wrong, had become universally known.  In almost identical words, a generation later H.O. Havemeyer, the head of the sugar Trust, had said under oath that his American Sugar Refining Company had no local party predilections, “no politics of any kind . . . only the politics of business.”  Huntington especially shows such impartiality, making shifts from one party to the other.  His private instructions to his partners read :

. . . Piper [pseudonym] is a wild hog ;  don’t let him come back to Washington, but as the House is to be largely Democratic, and if he was to be defeated, likely it would be charged to us, hence I think it would be well to beat him with a Democrat.

In another communication to Colton, Huntington says :

I hope . . . [X] is elected and . . . [Y] defeated, as it was generally understood that our hand was over the one and under the other . . .

In Congress, among the paid agents of Archbold is the Democrat Sibley, who as freely recommends certain of his Republican colleagues to the “good offices” of the Standard Oil leader as he does Democrats.  In 1889 the “reformer” Cleveland runs against Blaine, amid high political excitement throughout the land.  “What about this man Cleveland ?” wires Jim Hill to Tilden.  “He is all right,” is the reply, and Hill spreads this good word among his friends and retainers in the Northwest.

When Cleveland the knight of free trade was elected, Carnegie the steel master wired Frick from Europe :

Cleveland’s landslide !  Well, we have nothing to fear and perhaps it is all for the best.  People will now think that the Protected Manufacturers will be attended to and quit agitating.  Cleveland is a pretty good fellow.  Off for Venice tomorrow.

And Frick, who as president of the Carnegie company gave the Republican campaign fund $25,000 (a comparative minimum), answered :

I am very sorry for President Harrison, but I cannot see that our interests are going to be affected one way or the other by the change.

For Cleveland too, as we have recently learned from newly published documents, was “enveloped” by groups of the industrial barons.  On May 28, 1894, the financial journalist Clarence Barron notes the secret gossip which associates Cleveland at some recent period (probably between 1889 and 1892) with the stock-market pool working in Distilling & Cattle Feeding shares ;  the speculation is directed by none other than Jim Keene, Wall Street’s “Silver Fox,” in the interests of Oliver H. Payne, William C. Whitney, Senator Calvin Brice of Ohio and Nelson Morris.  But Nelson Morris and one Greenhut make $1,500,000 suddenly by “selling out on their associates.”  And so the informant comments :  “I hear that Cleveland had a loss at one time of $75,000 on this account.”

That “party,” finally, “amounts to little” is also the theme of another chronicle of the time, written a good many years afterward, by Frederick Townsend Martin, in his book, “The Passing of the Idle Rich”:

Among my own people I seldom hear purely political discussions.  When we are discussing pro and con the relative merits of candidates or the relative importance of political policies, the discussion almost invariably comes down to a question of business efficiency.  We care absolutely nothing about statehood bills, pension agitation, waterway appropriations, “pork barrels,” state rights, or any other political question, save inasmuch as it threatens or fortifies existing conditions.  Touch the question of the tariff, touch the issue of the income tax, touch the problem of railroad regulation, or touch the most vital of all business matters, the question of general federal regulation of industrial corporations, and the people amongst whom I live my life become immediately rabid partisans.  It matters not one iota what political party is in power, or what President holds the reins of office.  We are not politicians or public thinkers ;  we are the rich ;  we own America ;  we got it, God knows how ;  but we intend to keep it if we can by throwing all the tremendous weight of our support, our influence, our money, our political connection, our purchased senators, our hungry congressmen, our public-speaking demagogues into the scale against any legislation, any political platform, any Presidential campaign, that threatens the integrity of our estate . . .

Under the democratic system long established in the United States a proper view of the professional politician (in the unwritten manual of the barons) held him as a sort of “honest broker,” as the Beards have said, between the contending economic forces in the society or between competing undertakers.  The function of the machine politician was to carry out his commissions faithfully.  For this reason a man like Huntington was always ready to “pay much money” in order to effect practical working agreements in politics and have the seal of the sovereignty placed upon his transactions.  Whenever these working agreements broke down, there usually followed a comedy of errors which illustrated all the better the underlying principles in play.

May 8, 1890, a young Republican prosecuting attorney in Ohio, with the enthusiasm of an amateur, began a suit to annul the charter of the Standard Oil Company.  At once Mark Hanna wrote him the letter which contained the famous lines :  “You have been in Politics long enough to know that no man in public office owes the public anything”;  and which concluded :  “I understand that Senator Sherman inspired this suit. . . . If this is the case I will take occasion to talk to him sharply when I see him.”

In the same realistic vein Collis Huntington wrote to his henchman Colton the many letters which allude to public officeholders simply as field agents entrusted with management of the lawmaking institutions on behalf of railroad monopolies.  On April 3, 1877, he wrote :

We should be very careful to get a U.S. Senator from California that will be disposed to use us fairly, and then have the power to help us. . . . [X], I think, will be friendly, and there is no man in the Senate that can push a measure further than he can.

At almost the same time he wrote to his partner, Charles Crocker :

I fully appreciate your position and need of . . . [X, a United States Senator].  I fear when he gets there he will not be earnest in our interest as formerly.  Stanford thinks I am mistaken, and I hope I am.

And further, he wrote from Washington :

If you could get the right man on that line in Arizona to work . . . there, to agitate the question in the territory . . . offer the S.P. a charter that would free the road from taxation, and one that would not allow interference with the rates until ten percent was declared on the common stock, I believe the legislature could be called together by the people for $5,000 and such a charter granted.

On a trio of Congressmen who are evidently “developing” in promising fashion Huntington commented :

I hope . . . [X] will be sent back to Congress.  I think it would be a misfortune if he was not. . . . [Y] has not always been right, but he is a good fellow and is growing every day. . . . [Z] is always right and it would be a misfortune to California [sic] not to have him in Congress.

Here it is as if we are overhearing the secret conferences of the Western railroad magnates, Huntington, Stanford and Crocker.  The phrases which have been emphasized point to the political principles which animate Huntington and his mates.  The interests of California, of the United States are to his mind completely identified with those of the Pacific Associates.  A Senator is to be judged “right” or “growing” only when he “uses us fairly” or “helps us” or is unfailingly “earnest in our interest” or is a “good fellow”;  a state or territorial legislature exists to grant railroad charters to such groups as his own and “not allow interference with the rates”;  and finally all these public servants, having been chosen in democratic fashion by popular election, bring the effective support of “the people” (whose representatives are thus “called together” at a reasonable cost), to place their sanction upon the undertakings of the great barons.  These are but a few of the guiding principles which enable us to pursue our examination of the political tactics of these forceful leaders.

Huntington himself has left us the frank and forthright justification for his adventures in bribery in a letter of 1877 (year of the Southern Pacific’s great Congressional fight), which deserves its measure of immortality :

If you have to pay money to have the right thing done, it is only just and fair to do it . . . If a man has the power to do great evil and won’t do right unless he is bribed to do it, I think the time spent will be gained when it is a man’s duty to go up and bribe the judge.  A man that will cry out against them himself will also do these things himself.  If there was none for it, I would not hesitate.

By his own lights, Huntington did nothing that was not in the line of “duty,” one perceives ;  and his judgment that those who “cried out” against such “duties” would willingly do these things themselves under altered circumstances was only too often corroborated.  John Archbold, who conducted most of the secret contact work for the Standard Oil over a period of many years, also took the same view of public officers.  The best of the politicians were those who were most potent and those who did their “duty” most faithfully men :  like Senators Quay, Foraker, Penrose and Congressman Joseph Sibley, an ardent patriot, a demagogic waver of the “bloody shirt.”  Pious man though Archbold was, politicians who stubbornly refused to see the light, and especially “reformers” such as William Lloyd, who launched his books against the “Anaconda of Oil,” were enough to throw him into a towering and profane rage.  To Lloyd, Archbold accorded only the meanest and most mercenary motive :  that of sharing in the proceeds of damages which enemies of the Standard Oil Trust hoped to collect.  Men like Lloyd did no good to anyone and simply served to raise the final cost of political privilege.

To control the officeholder’s power for evil, and to gain time, Huntington and his fellows felt it “a man’s duty to go up and bribe. . . .”  At first, as we have seen in the case of Cornelius Vanderbilt, Gould and of the Credit Mobilier ring, the methods were exceedingly transparent ;  the railroad chieftain went to the state or national capital with a valise full of greenbacks ;  or he sat directly in Congress, like Oakes Ames, giving out stock to other Congressmen that they might be prompted to look after their own property.  Collis Huntington, to be sure, was a subtle master, who whenever possible secured signed evidence, such as canceled checks given in payment, so that the men involved were “ever afterward my slaves.”  Yet even by such careful measures there was tremendous waste.  Congressmen or state legislators could not be trusted to control their appetites when a fabulously rich railroad magnate or banker appeared on the scene.  The professional politicians became obstructive or “played honest” until prices were raised to fearful figures by forced bidding.

As time passed, we find Huntington groaning over the disbursements, which were always listed in the books under the headings of “General Expense” or “Legal Expense” or “Extra Legal Expense.”  He exclaimed in one letter in a mood of discouragement :  “They might as well take the road and be done with it.”  He inveighed against Gould for appearing in person at Washington during the discussion of an important railroad measure.  Representatives in state legislatures were often especially hard to control, and Huntington himself said :  “Buying votes of a legislature was a bad policy.”  Indeed it was much more effective and economical if one dealt directly, with the head of a political machine, be he the Senator or the governor of a state, or someone strategically placed in a committee on railways, Trusts or interstate commerce.  On October 29, 1877, we find Huntington writing to Colton :

I saw Axtell [Governor of New Mexico] and he said he thought that if we would send him such a bill as we wanted to have passed into a law, he could get it passed with very little money ;  when, if we sent a man there, they would stick him for large amounts.

Direct appearance in a body of lawmakers or direct bribery was then clumsy, wasteful, difficult to conceal, connected with dangerous company, and its costs susceptible of infinite increase automatically from year to year, like blackmail.  For instance, a Senator or Congressman who was a member of an important committee might “switch” his position on a bill, then ask for solid inducements to “switch back.”  Besides even Huntington, Gould or Rockefeller had moments when the state of public opinion, aroused to fury against them by incautious or inept “deals” or errors, set them on their guard.

Instead of outright bribery, highly subtle methods of distributing rewards to political friends came into play.  In California, for instance, one of the three members of the State Railroad Commission, the lawyer S.J. Cone, had occasion to purchase as an investment a large ranch of about 100,000 acres.  This he did through a subsidiary land company controlled by the Southern Pacific, at a price which was perhaps half that paid by other citizens.  The agent of the allpowerful railroad would appear to have been amazingly weak or stupid in the transaction, for the buyer resold his land within six months at double its cost to him.  After a few years as railroad commissioner this lawyer of modest practice emerged a millionaire ;  yet no overt actions were ever laid to him.

Warily, Huntington notes that his adversary Scott offers too much money and too openly.  It is sheer folly ;  the other is but victimizing himself.  “I keep on high ground,” he reports, “so that we cannot be hurt by any investigation.”  It was also well to “keep on high ground” in order to leave no evidence in the hands of potential blackmailers.  In fact they must be kept “under the gun” perpetually :

I am glad to know that you have Luttrell under your charge, but you must be careful and not let him get anything to strike back with. . . . He must have solid reasons or he will go back on you.

In the Pacific Railway Investigation of 1887, Huntington stated candidly that he was opposed to giving politicians or voters free liquor and cigars too open-handedly.  On the other hand, he and his fellows had no objection to “looking after” Senator X, by letting him “borrow” some money.  Similarly, John Archbold might now and then make a “loan of $1,000” to a Senator, as an “investment” suggested by the friendly Congressman Sibley.  And where Scott or Gould gave free passes on all the roads touching Washington, Huntington organized huge “junketing parties” on private trains at a cost of tens of thousands of dollars, by which politicians, their families and journalists might go on exhilarating excursions through his broad territories.

In time, all of the captains of industry found it greatly to their advantage to use the system of the hired “lobbyist,” a type of professional public agent who had flourished from the earliest days of the republic, but who came to assume a tremendously important and confidential rôle in the last quarter of the nineteenth century.  In this manner Jay Cooke and his brother Henry had been able to do heroic deeds with Congress immediately after the Civil War.  All the “interests,” banks, railways, mines, steel, munitions and war materials ended by having their specialized go-betweens or lobbies.  The working of one lobby is described most vividly by Huntington in a letter of January 14, 1876 :

I received your telegram that William B. Carr has had for his services $60,000 S.P. bonds, then asking how much more I think his services are worth for the future. . . . In view of the many things we have now before Congress . . . it is very important that his friends in Washington should be with us, and if that could be brought about by paying Carr $10,000 to $20,000 per year, I think we could afford to do it, but of course, not until he had controlled his friends.  I would like to have you get a written proposition from Carr, in which he would agree to control his friends for a fixed sum, then send it to me.

In this manner, the railway chief or oil magnate or sugar-refiner was able to simplify his operations by obtaining the “friendship” of a whole group of public officials en masse for an outright payment annually to a wholesale broker in political privilege.

The highest development of political technique came to flower in the heyday of “Uncle” Mark Hanna, who as “boss” of the Republican party rendered its tactics so attractive to the industrial captains that a clear majority of them rallied to its banner and paid rich tribute to its treasury.

It was at this time, as we have learned from the pilfered “Foraker Letters” that the pervasive methods of the lobby were augmented by a system of controls of strategic committees and their chairmen.  Thus an industrial commission is appointed in 1898, ostensibly to strike a blow at the Trusts.  But among its members are machine politicians such as Senator Boies Penrose of Pennsylvania, who keep in close touch with the secret political bureau of Standard Oil, and show Archbold in advance the report being prepared by the committee.  Archbold objects to parts of the report, and Penrose and his committeemen “tone it down”;  then it is submitted anew to the Standard Oil chieftain and he replies finally :  “We think the report is so fair that we will not undertake to suggest any changes.”

No lest devoted was Senator Joseph Foraker, Republican, of Ohio, who while occupying strategic positions in Senate committees received considerations from the Standard Oil Company running as high as $44,000 in a single period of six months—this coming at the very time when he was busily engaged in preparing the anti-Trust planks of the Republican platform.

By 1890, a truly formidable tide of popular unrest was running through the country, and much of that popular consent which the barons had gained during the preceding twenty-five years seemed forfeited.  During the debates over the tariff bill in Harrison’s administration, the Republican party seemed to share the obloquy of its richest champions.  The general outcry arose that the tariff “held the people down while the Trusts went through their pockets.”  William Lloyd by his vigorous pamphleteering pictured an America in which the citizen was born to drink the milk furnished by the milk Trust, eat the beef of the beef Trust, illuminate his home by grace of the oil Trust, and die and be carried off by the coffin Trust.  The Republicans were hard-pressed, but were more sagaciously led than ever.  In Washington a bargain was apparently struck among the professional politicians to enact the new and higher protective-tariff measures, while passing at the same time certain measures of supposed anti-Trust legislation.

“Though the Republican leaders were much averse to providing such control of Trusts,” writes H.J. Ford, in the “Cleveland Era,” “they found inaction so dangerous that on January 14, 1890, Senator John Sherman reported from the finance committee a vague but peremptory statute to make trade competition compulsory. . . .”  Its first section declared that every “contract, combination or conspiracy in restraint of trade, or commerce among the several states or foreign nations is hereby declared to be illegal.”  This bill, however, with its “impenetrable language” made no attempt to define the offenses it penalized, and created no machinery for enforcing its provisions.  At the same time, jurisdiction over alleged violation was given over to the courts, “a favorite congressional mode of getting rid of troublesome responsibilities,” as Ford observes.  Once more, as in the case of the Interstate Commerce Act of 1887, a Senator remarked that no one knew what the bill would do to the Trusts, but nearly everyone agreed that “something must be flung out to appease the restive masses.”  Thereafter, two presidents, Cleveland and McKinley, expressed their complete skepticism as to the efficacy of the Sherman Law, and made almost no move to enforce it, while the Supreme Court especially, and the Constitution itself, stood like a rock of salvation opposed to the “so fearful . . . assaults upon capital,” as Justice Stephen J. Field, brother of Cyrus and David Dudley Field, termed it.

Yet there were seasons of danger which gave pause to the triumphant nabobs.  A long series of hostile demonstrations and ominous conflicts broke forth ;  after the strikes and riots of 1885 and 1887, which touched only part of the country, there came episodes more fateful still :  the Homestead uprising against the Carnegie steel works in 1892, the Pullman strike led by Eugene Debs in 1894, and then the march of “General” Coxey’s impoverished rabble of unemployed upon Washington.  The historic cry for inflation arose anew from the farmers and small merchants who were bowed down under their debts.  And at last from the “safe and sane” leadership of a Tilden or a Cleveland, the old Democratic party finally passed into the hands of the fiery young Western orator who would have rescued suffering people from “the cross of gold.”

Before this “wave of the socialist revolution,” this onslaught upon the “rights of property” on behalf of more or less ruined laborers, merchants, farmers, miners and country lawyers, at “this league of hell,” a great shudder swept the ranks of the barons.  1896 is a red year in all the chronicles, memoirs, biographies of the period.  There is a tumult among them, now loud, now secret ;  frantic preparations are made as for a death struggle, while the wheels of industry are virtually halted.

Now Mark Hanna, chairman of the Republican party, showed an energy, a cool nerve for the great emergency, that was akin to genius.  He moved in the highest places, levying staggering assessments, such as $400,000 from the beef group, and $250,000 from the Standard Oil.  Hysteria spread in these purlieus :  “You make me think of a lot of scared hens,” said Hanna to a meeting of great industrialists.  Men like James Hill, who had been having his troubles with labor, surreptitiously changed their political allegiance from the Democratic to the Republican banner.  “There is an epidemic craze among the farmers and . . . those who receive wages or salaries,” he wrote to J.P. Morgan, July 15, 1896.  He urged that the managers of the McKinley campaign “should get to work at once,” adding that “I will do anything or everything in my power to further the end we all have in view.”

Everyone labored in the sacred cause.  Mr. Hill bought a newspaper in St. Paul, The Daily Globe, “to keep it from falling into the hands of the free-silver interests”;  and Mr. Archbold sent Foraker money for another newspaper in the East.  The New York Sun, the New York Tribune joined in the hue and cry.  Workmen were assured that all employment would be forfeited should Mr. Bryan be elected.  Tons of literature, pamphlets by the million were circulated everywhere by Hanna.  In New York on the eve of the election, the city was decked with flags and a monstrous Republican parade took place, with 80,000 marchers demonstrating against Bryan, one section consisting of 5,000 bankers and brokers, who cheered for Pierpont Morgan.  Before such an irresistible combination of defensive force, led so brilliantly by Hanna, Bryan’s hosts were rolled back in decisive defeat—the moment of “class struggle” passed by.  “God’s in his Heaven—all’s right with the world,” Hanna telegraphed McKinley.

2

God was in his Heaven, but in one section of society, that of the masses of labor, opposition to the conquerors of industry had developed in most menacing form by 1885.  Where the landed aristocrats, the associations of farmers or other groups among the consumers had failed to check for a moment the sweep of the captains of business, labor steadily organized itself into combinations, the better to deal with the concentrated force of its employers.  Against the threat of labor’s growing might, and its demands which they held intolerable, the barons exerted themselves with promptitude, with tremendous energy and with an unflinching ruthlessness.  In the United States, as in almost no other industrial nation, the encroachments of organized labor were halted or neutralized or completely nullified.

Here we need regard only certain aspects of the American labor movement—whose picturesque special history, in any case, has been well told by others—and particularly those aspects which illuminate the principles and the tactics of the industrial barons in their “heroic age.”

The owners of land, capital and the means of production sought to give as little as possible to labor, as they did everywhere in the world after the handicraft regime had disappeared and factory labor had taken its place.  Where the pre-capitalist hand worker, as his own master, had been wont to take the full proceeds of his labor and to produce only “for his needs,” all the “surplus value” arising from the division of labor in the eighteenth century and the introduction of machinery thereafter went to the commander of capital ;  indeed all the value derived from the process which was not needed to keep body and soul together for the hired workman was so disposed of.  This order of things was no more questioned by the earliest American owners of land, goods and machines than by any others.  Yet in the new continent the wages of labor were relatively high ;  and many a small capitalist in the period before the Civil War complained bitterly of this condition, as of the scarcity of laborers and their transiency.  The hordes of poor immigrants who poured into the country soon turned from regular toil in mills for twelve or thirteen hours a day to possess themselves of the free lands of the frontier, where they could labor as masters of themselves.

But wherever possible and as long as possible the owners of factories and industries, spurred by competition, sought to hold their laborers to the lowest possible wages and the longest hours ;  and toward the middle of the nineteenth century to render the motions of labor as simple, as mechanical as possible, so that great numbers of women, children and unskilled Negroes could be pressed into service.  From the beginning the managers of industrial enterprise favored the free immigration of subjects of every race and land under the sun to this asylum of freedom—even if they had to be brought here in contract labor gangs.

Since the 1870s the Carnegie steel company in Pittsburgh, for instance, had begun the systematic hiring of immigrants.  The report of social workers for the Pittsburgh Survey, issued by a foundation established by Mrs. Russell Sage, relates :

It is a common opinion in the district that some employers of labor give the Slavs and Italians preference because of their docility, their habit of silent submission . . . and their willingness to work long hours and overtime without a murmur.  Foreigners as a rule earn the lowest wages and work the full stint of hours. . . .

Many work in intense heat, the din of machinery and the noise of escaping steam.  The congested condition of most of the plants in Pittsburgh adds to the physical discomforts . . . while their ignorance of the language and of modern machinery increases the risk.  How many of the Slavs, Lithuanians and Italians are injured in Pittsburgh in one year is unknown.  No reliable statistics are compiled . . . When I mentioned a plant that had a bad reputation to a priest he said :  “Oh, that is the slaughter-house ;  they kill them there every day.” . . . It is undoubtedly trite, that exaggerated though the reports may be, the waste in life and limb is great, and if it all fell upon the native born a cry would long since have gone up which would have stayed the slaughter.

In hard times, the manufacturers were not responsible for the souls of their hired hands, like the manorial lords of the Middle Ages ;  few measures of safety were provided in mines and mills, where hundreds and even thousands were killed and maimed annually.  Little heed was paid to the quarters in which workers and their families resided, the food they ate or the water they drank.  With the passing of time, toward 1890, 10 per cent of the population of our great cities were housed in slums as terrible as those of the wretchedest places in the Old World.  And in the neighborhood of the big manufacturing works, stockyards, and mines, the unlovely shacks of laborers’ communities clustered, like the cottages of servants and hired hands in feudal times.

A great steel manufacturer noted for his lavish philanthropies would acquire an additional mill in Pittsburgh, and in taking this over would also take possession of the row of company houses in which the workers resided.  Thus Carnegie, buying Painter’s Mill in Pittsburgh, renovated its producing plant thoroughly ;  but the notorious “Painter’s Row” on the south side of the town was left untouched—with its five hundred people living in back-to-back houses, without ventilation, having cellar kitchens, dark, overcrowded sleeping quarters, no drinking water whatsoever, and no sanitary accommodations worth the name.

In, Pittsburgh, in the coal fields of Pennsylvania, in the New England textile cities and in the neighborhood of the Chicago stockyards laborers lived huddled together in company “patches” varying from the quality of shambles to “model towns” such as that of Pullman, outside of Chicago.  But unlike the baron of the feudal castle, the owner of the latter-day mill or mine used his servants with no lordly spirit, but instead with that dispassionate logic, with that “holy parsimony” which marked all his undertakings, large and small.  This was to be seen in every contract with or usage of the laborer.  If the very enterprising Pullman Company expended some $5,000,000 per annum in wages, at an average rate of $600 a year, it contrived through the model town in which its subjects were housed to win back a great part of this sum, renting them houses, selling them food, gas, water and a variety of compulsory services or conveniences at what were afterward proved to be enormously profitable rates.  Thus not only from the employees’ labor were famous profits taken, but even from their hours of rest and refreshment.

But in a period of adversity and idleness, the workman was in no way assured of food or lodging, as even the medieval serf had been.  His wages might be sharply reduced, or might wholly disappear, as in 1893 at Pullman :  the exactions of his landlord continued ;  so that here as in the mining communities with their “company stores” he might receive almost nothing in his pay envelope, after “deductions,” or might labor on in debt until evicted.

In this rich, spacious country, the laborer who was “worthy of his hire” might move on toward the receding Frontier, where new demand for his labor was incessant, where homestead farms were open to those willing or able to wander far enough, or possessing the capital needed to till them.  So that the lot of the worker, especially the native worker, was almost never as cruel as in the densely populated regions of Europe.  But between 1885 and 1893, the margin of free soil had dwindled finally to a negligible residue ;  while at the same time the effects of thoroughgoing combination and mechanical standardization in the industrial system seemed to remove the last vestiges of “natural rights.”  Now in desperation the workers banded themselves together more and more often in secret orders or in craft unions, or simply in crusades to wage industrial war on their masters.

From earliest times the commanders of industries had shown the sternest resistance to such combination of the workers against themselves as they formed on their own behalf.  The most notable labor disputes before 1860 had arisen in the first great textile mills of the country, located in New England ;  and the resolution of the masters in opposing the “unlawful” demands of labor is shown by the famous words of Colonel Borden, cotton-maker of Fall River, whose men, women and children struck in 1850 against the thirteen-hour day :

I saw that mill built stone by stone ;  I saw the pickers, the carding engines, the spinning mules and the looms put into it, one after the other, and I would see every machine and stone crumble to the floor and fall again before I would accede to your wishes.

So a generation later Jim Fisk, in a strike of the Erie brakemen, “sent a gang of toughs from New York under orders to shoot down any man who offered resistance,” arousing widespread admiration for his sterling courage.  This opposition of men like Fisk to labor’s claim of a special “interest” in its situation was largely typical of American sentiment.  And that grand oracle Henry Ward Beecher sounded the feeling of the majority of citizens who were not urban laborers, in 1877, when he cried out that “laborers’ unions are the worst form of despotism and tyranny in the history of Christendom !”

The barons of industry continued to set aside all softer considerations for those of progress in the economy and technology of their business.  Mine-owners found ways of altering the weight of a ton of coal which the worker must dig, from 2,340 pounds to 2,700 or even 4,000 pounds.  In his telegraph monopoly, Jay Gould supplanted old employees with inexperienced persons at much lower salaries, which in the view of his apologists was “both just and politic”;  the stockyards houses trained their personnel in the art of a first, simplified mass-production ;  while railroad men such as Jim Hill boasted :  “I will make one engine do the work of three and dispose of two crews.”

In the railroad field, where workers felt themselves particularly indispensable owing to the need of experience and the close coordination of all movements, they tended to unite most effectively in their own interest.  In 1877, the actions of the Baltimore & Ohio and the Pennsylvania railroads in twice reducing wages by 10 per cent, and then running “double-headers,” that is, thirty-four freight cars in place of seventeen cars, behind a single engine and manned by a single crew of men, were passionately resented, and provoked a determined strike which soon swept into other railways, and assumed a “national” character.  The armies of trainmen, in their desperation, developed a violence surpassing that of the English “machine-wreckers” in earlier days.  In Pittsburgh, more than $5,000,000 of property was destroyed by the rioting and looting workers, and the railroad chiefs were only saved by calling out militia and finally detachments of federal troops, who succeeded in putting down the strike with no little bloodshed.  From this time, John Commons points out, the industrial barons made a habit of calling soldiers to their assistance ;  and armories were erected in the principal cities as measures of convenience.

Though the railway strike was broken, remarkable enthusiasm was now engendered among the workers, and there resulted a great expansion of the recently organized Knights of Labor, the secret and fraternal organization which carried on throughout the country a kind of crusade against capitalism.

By 1885 the Noble Order of Knights of Labor held a certain terror for the rulers of great industries.  A victorious strike against Jay Gould’s Missouri Pacific Railroad in this year brought numerous recruits to the banners of the Order, which aroused immense hope among the workers through having conquered the man who was reckoned both the strongest and the wiliest of capitalists.  The might of this curious labor union was much exaggerated in the press, one widely reprinted article in the New York Sun in 1885 asserting that five men exerted autocratic powers over 500,000 workmen :

They can stay the nimble touch of almost every telegraph operator, can shut up most of the mills and factories, and can disable the railroads.  They can issue an edict against any manufactured goods so as to make their subjects cease buying them, and the tradesman stop selling them.  They can array labor against capital, putting labor on the offensive or defensive, for quiet and stubborn selfprotection or for angry, organized assault, as they will.

Gould, however, with his usual shiftiness, did not abide by the terms of settlement he had accepted ;  he discriminated against union members, directed shop-work to other plants where it could be done at lower cost, and precipitated in the following year, 1886, a second and more violent strike.  Here were involved 9,000 men directly, under the leadership of the flaming Martin Irons ;  the uprising spread to adjoining railway systems, railway properties were besieged and captured by workmen, and business was paralyzed in a broad zone of the country.

Terence V. Powderly, Grand Master of the Knights of Labor, wrote his challenge to Gould, saying :

The system, which reaches out on all sides, gathering in the millions of dollars of treasure and keeping them out of the legitimate channels of trade and commerce must die. . . . I play no game of bluff or chance.  I speak for 500,000 organized men . . .

And Gould in the accents of a Self-made Man replied :

In answer to these personal threats, I beg to say that I am yet a free American citizen.  I am past forty-nine years of age . . . I began life in a lowly way, and by industry, temperance, and attention to my own business have been successful, perhaps beyond the measure of my deserts.  If, as you say, I am now to be destroyed by the Knights of Labor unless I sink my manhood, so be it.

Gould’s letter was widely publicized and brought many flattering encomiums, which had up to now been withheld from him.  He won this strike, after long struggle and deprivation for the inhabitants of the whole Southwest, as he had won the Western Union strike of 1883.

But henceforth, after 1886, even greater force and sovereign authority was marshaled on behalf of the alarmed industrial chieftains.  Pinkerton detectives and industrial spies were used to weed out union men.  The lockout, especially used by Carnegie, and the “blacklist” or “iron-clad oath” (not to participate in a union) were enforced by monopolists acting in concert.  Finally, after the Haymarket riot in Chicago, where the explosion of a deadly bomb stirred public opinion to boiling pitch, all the forces of law and order, from local magistrates and militia to the President and the Supreme Court, united to crush the “conspiracy” of labor. In, 1886 and 1887 the courts began to interfere actively with the movement to organize labor ;  and in 1888, the first celebrated “injunction” was issued by a federal court in connection with a Western railway strike, and was justified on the ground of the Interstate Commerce Act, which forbade “conspiracy in restraint of trade.”  Soon arrests and trials without jury were ordered, as in the Pullman strike of 1894.  Here President Cleveland sternly intervened, by sending armed troops to run the mail trains, saying to those who pleaded on behalf of the workers :  “You may as well ask me to dissolve the government of the United States !”

Thus the very laws which for long years it was found impossible to enforce against collusive combination or conspiracy among the industrialists were invoked with remarkable promptness and effectiveness against the associations of laborers.  These judicial decisions were rendered in the name of sacred rights of property ;  and as the Beards have noted, they were rendered on the same grounds and at the very same time that the new direct income-tax law was being declared unconstitutional by the Supreme Court, following the appeals of Mr. Rockefeller’s lawyer, Joseph Choate.¹

There is a beautiful instance of the resourcefulness with which the courts rose to the emergency at this time, cited by Henry Pringle in his “Theodore Roosevelt.”  In 1884, a bill of the New York State Legislature championed by the young Assemblyman Roosevelt, and designed to halt the manufacture of cigars in filthy city tenements, became law, but was promptly nullified by the state Court of Appeals.  This high court gave the following decision upon the natural liberties of cigar manufacturing :

It cannot be perceived how a cigar maker is to be improved in his health or his morals by forcing him from his home and its hallowed associations and beneficent influences.

This decision to Roosevelt represented legalism in its worst guise, blocking reform legislation such as he sought ;  it was used with endless fertility in the labor struggle.  Before such assembled authorities and powers, courts, police, legislators, President, the Knights of Labor as a militant “industrial union” was baffled, and collapsed.  Happily for the captains of industry, the ranks of the labor army were torn with dissension ;  Utopians, “anarchists,” Marxian socialists and “craft unionists” contended with each other long and bitterly, until the faction headed by Samuel Gompers, with its narrow and tempered craft-union program, arose from the ruins of the Knights of Labor.

The most spectacular conflict in all this period of industrial war was undoubtedly that which took place in 1892 at the big Carnegie steel works known as Homestead.  This strike illustrates at once the insurrectionary spirit to which the workers were roused at this time, and the well-nigh invincible defense furnished by the giant corporations in America led by such resolute captains of industry as Henry Frick, then president of the Carnegie company.  Homestead was a strategic engagement, as we shall see, which the great steel monopoly was determined to fight to a finish.

Frick, for the decade before his arrival as head of the Carnegie company, had been, as a baron of coke, foremost among those who utilized labor with pitiless “efficiency,” and strongly resisted “collective bargaining.”  He had wished to introduce as rapidly as possible the successful methods of his coke company into the steel works, which in the view of the workers involved the destruction of such labor associations as had already established themselves in the field.

In the brief depression of 1884-85 Carnegie, who professed to oppose the use of “scabs” and said :  “Thou shalt not take thy neighbor’s job,” suddenly shut down his Edgar Thomson works in Pittsburgh.  Here the triple eight-hour shift had ruled for a time ;  but he had found that Chicago steel mills using the twelve-hour shift were paying 6 per cent less than he for crews of laborers.  Hence he introduced new equipment and machinery throughout his plant, prepared to return to the “double-turn” or twelve-hour shift, and publicly blamed the workers’ organization (Amalgamated Association of Iron and Steel Workers) for “allowing other Bessemer mills to work at less wages than we pay.”  After a prolonged, though peaceful lockout—Carnegie’s favorite method of fighting labor—he had forced his men to come back on a nonunion basis, to accept certain cuts in wages and in man power, and was soon ready to face his Western competitors with economies estimated at 19 per cent against their previous advantage of 6 per cent.

The continual pressure upon labor always present at the Carnegie mills was further intensified with the coming of Frick as executive manager in 1889.  Frick at heart felt that there was no place for labor unions under the mass-production system he envisaged.  His proposals for sweeping reductions of wages and for nonunion contracts brought a strike by the Amalgamated Association of Iron and Steel Workers.  Agreements favorable to the workers were reached, after a brief and spirited but orderly strike, and these were to hold good for three years, to July, 1892.  But in the spring of 1892, Frick, though knowing his company was earning $4,000,000 per annum, made the official pronouncement that it was “headed for bankruptcy” unless “industrial control” were wrested from the union.  Yet, before presenting his new labor contracts to the men (with Carnegie’s more than tacit approval), he made elaborate preparations for the life-and-death struggle which such sharply lowered wages would inevitably provoke.  On the one hand he made arrangements to shift orders for goods to the Braddock and Duquesne mills of his firm ;  on the other hand, he brought in Pinkerton detectives to study the ground of the steel works, threw up ramparts with loopholes all around Homestead, and ordered 300 Pinkerton guards held in readiness for its defense.

To the unionists all these war preparations meant only one thing :  that the man who had long been the storm center of bloody labor strife in the Connellsville coke fields was moving to crush out their union once and for all, even before they had the chance to pass on his demands.  The strike began on July 1, 1892, as the plant shut down ;  and Frick moved at once to bring in nonunion men or “scabs,” in order to reopen, as he announced, on July 6.  He based his actions upon “the inviolability of ‘property,’ no less than on ‘life and liberty’ guaranteed by the Constitution.”  By the testimony of a Congressional committee, he was “stern, brusque and autocratic” in his negotiations.  Moreover the high-handed Frick did not wait for the Governor, the police or the militia of Pennsylvania to support him, but engaged himself to bring a battalion of armed industrial guards up the Monongahela River in tugs, at midnight of July 6.  What followed was to be one of the famous “dramas of capital and labor,” from which Andrew Carnegie so often sought to exculpate himself.

The Homestead men had been working in the mill at that place, many of them since it was first built.  They had seen it grow from a small beginning to one of the finest and best equipped plants in the world.  They were proud of that plant and proud of the part that they had had in its progress.

So writes John Fitch, in his “The Steel Workers,” and perhaps he exaggerates little in indicating this “pride of workmanship” felt by the laborers.  According to Veblen’s theories, the laborers were eternally concerned with “industry,” with their work and their product ;  while the owners were nowadays chiefly occupied with the “administration” and profits.

Over the hills rising from the river were their cottages, many of them owned by the workingmen . . . and now these homes were in jeopardy [continues Fitch].  They could have gone back to work . . . But that meant giving up their union . . . self-disenfranchisement.  So when the Pinkerton men came, the Homestead steel workers saw in their approach an attempt at subjugation at the hands of an armed force of unauthorized individuals.  A mob of men with guns coming to take their jobs . . . to take away the chance to work, to break up their homes—that is what passed through the minds of the Homestead men that morning.

The brawny men of the Bessemer furnaces, the whole population of Homestead, transformed into raging demons, were waiting for the Pinkertons when they arrived at dawn of July 6.  What followed—the rioting, the killing of guards and workers, the capture and torture of the Pinkerton guards—the possession of the Homestead plant by the workers, the five months’ long struggle—none of this may have been foreseen by Henry Frick, but it was certainly in key with the instigating measures he had taken.  The steel works were soon besieged and captured by government soldiers.  Although at first throughout the world popular sympathy supported the beleaguered laborers, their front was broken finally, as a result of the New York anarchist Berkman’s misguided attempt to assassinate Frick.  In the end the light wounds of Frick, “intrepid” and “lion-like,” brought him glory and hardened the resistance of the steel masters until they had won the day.  He despatched an exultant cablegram to Carnegie, far off in Europe as usual :

Nov. 21 :  Strike officially declared off yesterday.  Our victory is now complete and most gratifying.  Do not think we will ever have any serious labor trouble again.

By letter at the same time Frick wrote that though the losses from the strike had been great, $2,000,000, they “had been charged up so that we swallowed the dose as we went along . . .”  The company showed profits of $4,000,000, or 16 per cent on its declared capital, after losses counted.  And he summed it all up by adding :

We could never have profited much by any of our competitors making and winning the fight we have made.  We had to teach our employees a lesson, and we have taught them one that they will never forget.

This was accurate, and Frick alone deserved the glory which fell to him for having freed the steel industry forever from the “tyranny” of labor.

“Congratulations all around—life worth living again—how pretty Italia,” Carnegie wired him.  And John D. Rockefeller (taking heart from Frick’s heroic stand against “anarchy”) wrote to Frick “approving his course and expressing sympathy.”  In his own factories Rockefeller would permit no collective bargaining, but only “company unions” in the time-honored relationship of “obedient servants and good masters.”

The kind of labor union which the American industrialists everywhere preferred and established was described by Charles M. Schwab, who succeeded Frick as president of the Carnegie Steel Company, in a confidential talk with Barron :

Since that day [of the Homestead strike] I have never had labor unions in any of my concerns.  We make our own labor unions.  We organize our labor into units of 300 and then the representatives of these 300 meet together every week.  Then every fortnight they meet with the head men.  Although we are only twenty or thirty and they three hundred representatives . . . we never allow dictation.  We discuss matters but we never vote.  I will not permit myself to be in the position of having the labor dictate to the management.

The great industrial trusts which were formed in the 1890s plainly feared the intercession of organized labor in their process of production and in the heavy industries checked its advance thoroughly.  To combat labor troubles they possessed many advantages.  This was readily admitted by John W. Gates, head of the steel and wire Trust, which employed 36,000 men.  Although resisting unions and collective bargaining, Gates and his colleagues protested that as they installed labor-saving machinery they tended to increase wages in accordance with the rising output per workman, though they distinctly confessed that “these increases in wages had not been given excepting as the result of demands on the part of the workingmen themselves ;  that the Combinations made no pretenses toward generosity.”

In introducing technical economies, in adjusting wages, in the hiring or firing of their workers, the barons exercised their sacred rights over colossal properties in a manner which closely paralleled the “Divine Right” of feudal princes.  As an example of such absolutism, there was the instance of John “Bet-a-Million” Gates, startling the country by suddenly shutting up his big Chicago plant and, in a time of plenty, throwing many thousands of men out of work.  “The steel and wire business is in bad shape,” Mr. Gates announced to the press, though none had noticed this as yet.  His real motive was rumored in financial circles to be something else.  Having previously sold his own stock short in the Wall Street market, it was reported he now desired to create a bear market.  A very short time later without any further ado he reopened his factories and ran them full tilt !

In the coal fields, however, labor war often raged as the miners in dismal regions of Pennsylvania, Ohio and Illinois struggled against their lot, most of them at a “subsistence wage” of $358 to $450 a year up to 1900.  In the great Pennsylvania coal fields, those resplendent magnates, the Vanderbilts, J. Pierpont Morgan, and Cassatt of the Pennsylvania Railroad had after a process of “squeezing” smaller capitalists added most of the anthracite mines to their railroad domains.  Anthracite mining was “a business . . . not a religious, sentimental or academic proposition,” as George F. Baer, the mine-operator, asserted.  The coal mines were consolidated upon a grand scale around the Philadelphia & Reading Coal & Iron Company, of which Baer was president, and prices of anthracite were sharply advanced $1.25 to $1.35 a ton in 1900.

In the meantime the grievances of the miners cried out to Heaven.  Their children, as Samuel Gompers related, were “brought into the world by the company doctor, lived in a company house or hut, were nurtured by the company store . . . laid away in a company graveyard.”  Under John Mitchell, leader of the United Mine Workers, they rose in May, 1902, in a great strike of 140,000 miners, which menaced the country with an acute coal shortage for the coming winter.

As months passed, appeals were made to Pierpont Morgan to bring about a settlement ;  but he refused to “interfere” and ordered the strikers to go back to work.  “Then, and not till then, will we agree to talk about concessions.”

Hard pressed, the groups of business men in the coal regions, after six months of coal shortage and suffering, made petition at last to President Roosevelt, saying, as Lewis Corey relates in his “The House of Morgan”:

Is J. Pierpont Morgan greater than the people ?  Is he mightier than the government ? . . . Morgan has placed a ban upon us which means universal ruin, destitution, riot and bloodshed. . . . We appeal from the king of the trusts to the President of the people.

The President, aroused to the utmost, was resolved to intervene and force arbitration between the two camps.  He threatened to man the mines with federal troops.  Morgan and most of the coal-operators yielded ;  but to effect arbitration it was necessary to hold conferences with a representative of labor.  This, at the last moment, men like George Baer obdurately refused to do, holding that they could not “meet a criminal. . . .”  To the President they used “insolent and abusive language,” insisting that no union-labor man must appear among the arbitrators.  It dawned on the President then, as Henry Cabot Lodge relates, “that the mighty brains of these captains of industry would rather have anarchy than tweedledum, but that if I used the word tweedledee they would hail it as meaning peace.”  Roosevelt therefore humorously agreed to appoint his labor man as “an eminent sociologist,” whereupon there was tremendous and instant relief, according to his own account.  Morgan eagerly ratified the truce.  Although the mine-operators had vowed there was no need for intervention, the impartial committee appointed by the President to investigate the coal fields found appalling conditions, and awarded the demands of the strikers for a 10 per cent wage increase, meanwhile denying recognition of their union.

The long strike ended in a compromise ;  but it is remembered for other reasons.  In the midst of the contest George F. Baer, the president of the Philadelphia & Reading company, had given utterance to an immortal declaration which epitomized forever the concept of a “divine right” over labor held by the coal barons.  In answer to pleas by a devout person for Christian mercy to the miners he wrote in a letter :

The rights and interests of the laboring man will be protected and cared for by the Christian men to whom God has given control of the property rights of the country.  Pray earnestly that right may triumph, always remembering that the Lord God Omnipotent still reigns.

¹ The metaphysics of “natural liberty,” pecuniary or otherwise, as Veblen comments in his “Theory of Business Enterprise,” was firmly founded in the Constitution of the land.  The owner retained all freedom of contract, and was never to be deprived of “life, liberty and property” without due process of law.
      On the other hand, the workman under the standardized, concentrated form of economic life which machine industry imposed might have no choice left him in the acceptance of a contract for his labor.  He might starve.  But, the necessities of a group of workmen are, under the law “not competent to set aside . . . the natural freedom of the owners of the processes to let work go on or not, as the outlook for profits may decide.  Profits is a business proposition, livelihood is not.”