Great Fortunes from Railroads Part 12

THE WISDOM OF GRAND LARCENY.

Now it was that one could see with greater clearness than ever before, how the mercenary ideal of the ruling cla.s.s was working out to its inevitable conclusion. Society had made money its G.o.d and property its yardstick; even in its administration of justice, theoretically supposed to be equal, it had made "justice" an expensive luxury available, in actual practice, to the rich only. The defrauder of large sums could, if prosecuted, use a part of that plunder, easily engage a corps of shrewd, experienced lawyers, get evidence manufactured, fight out the case on technicalities, drag it along for years, call in political and social influence, and almost invariably escape in the end.

But beyond this power of money to make a mockery of justice was a still greater, though more subtle, factor, which was ever an invaluable aid to the great thief. Every section of the trading cla.s.s was permeated with a profound admiration, often tangibly expressed, for the craft that got away with an impressive pile of loot. The contempt felt for the pickpocket was the ant.i.thesis of the general mercantile admiring view of the man who stole in grand style, especially when he was one of their own cla.s.s. In speaking of the piratical operations of this or that magnate, it was common to hear many business men interject, even while denouncing him, "Well, I wish I were as smart as he." These same men, when serving on juries, were harsh in their verdicts on poor criminals, and unctuously flattered themselves with being, and were represented as, the upholders and conservers of law and moral conduct.

Departing from the main facts as this philosophical digression may seem, it is essential for a number of reasons. One of these is the continual necessity for keeping in mind a clear, balanced perspective. Another lies in the need of presenting aright the conditions in which Vanderbilt and magnates of his type were produced. Their methods at basis were not a growth independent of those of the business world and isolated from them. They were simply a development, and not merely one of standards as applied to morals, but of the mechanism of the social and industrial organization itself. Finally it is advisable to give flashlight glimpses into the modes and views of the time, inasmuch as it was in Vanderbilt's day that the great struggle between the old principle of compet.i.tion, as upheld by the small capitalists, and the superseding one of consolidation, as incarnated in him and others, took on vigorous headway.

HE CONTINUES THE BUYING OF LAWS

Protest as it did against Vanderbilt's merging of railroads, the middle cla.s.s found itself quite helpless. In rapid succession he put through one combination after another, and caused theft after theft to be legalized, utterly disdainful of criticism or opposition. In State after State he bought the repeal of old laws, or the pa.s.sage of new laws, until he was vested with authority to connect various railroads that he had secured between Buffalo and Chicago, into one line with nearly 1,300 miles of road. The commercial cla.s.ses were scared at the sight of such a great stretch of railroad--then considered an immense line--in the hands of one man, audacious, all- conquering, with power to enforce tribute at will. Again, Vanderbilt patronized the printing presses, and many more millions of stock, all fict.i.tious capital, were added to the already flooded capital of the Lake Sh.o.r.e and Michigan Southern Railroad Company. Of the total of $62,000,000 of capital stock in 1871, fully one-half was based upon nothing but the certainty of making it valuable as a dividend payer by the exaction of high freight and pa.s.senger rates. A little later, the amount was run up to $73,000,000, and this was increased subsequently.

Vanderbilt now had a complete railroad system from New York to Chicago, with extensive offshoots. It is at this point that we have to deal with a singular commendation of his methods thrust forward glibly from that day to this. True, his eulogists admitted then, as they admit now, Vanderbilt was not overscrupulous in getting property that he wanted. But consider, they urge, the improvements he brought about on the railroads that came into his possession; the renovation of the roadbed, the inst.i.tution of new locomotives and cars, the tearing down of the old, worn-out stations. This has been the praise showered upon him and his methods.

Inquiry, however, reveals that this appealing picture, like all others of its sort, has been ingeniously distorted. The fact was, in the first place, that these improvements were not made out of regard to public convenience, but for two radically different reasons. The first consideration was that if the dividends were to be paid on the huge amount of fabricated stock, the road, of necessity, had to be put into a condition of fair efficiency to meet or surpa.s.s the competing facilities of other railroads running to Chicago. Second, the number of damage claims for accident or loss of life arising largely from improper appliances and insufficient safeguards, was so great that it was held cheaper in the long run to spend millions for improvements.

PUBLIC FUNDS FOR PRIVATE USE

Instead of paying for these improvements with even a few millions of the proceeds of the watered stock, Vanderbilt (and all other railroad magnates in like cases did the same) forced the public treasury to defray a large part of the cost. A good ill.u.s.tration of his methods was his improvement of his pa.s.senger terminus in New York City. The entrance of the New York Central and the Harlem Railroads is by way of Park (formerly Fourth) avenue. This franchise, as we have seen, was obtained by bribery in 1832. But it was a qualified franchise. It reserved certain nominal restrictions in behalf of the people by inserting the right of the city to order the removal of the tracks at any time that they became an obstruction. These terms were objectionable to Vanderbilt; a perpetual franchise could be capitalized for far more than a limited or qualified one. A perpetual franchise was what he wanted.

The opportunity came in 1872. From the building of the railroad, the tracks had been on the surface of Fourth avenue. Dozens of dangerous crossings had resulted in much injury to life and many deaths. The public demand that the tracks be depressed below the level of the street had been resisted.

Instead of longer ignoring this demand, Vanderbilt now planned to make use of it; he saw how he could utilize it not only to foist a great part of the expense upon the city, but to get a perpetual franchise. Thus, upon the strength of the popular cry for reform, he would extort advantages calculated to save him millions and at the same time extend his privileges. It was but another ill.u.s.tration of the principle in capitalist society to which we have referred before (and which there will be copious occasion to mention again and again) that after energetically contesting even those petty reforms for which the people have contended, the ruling cla.s.ses have ever deftly turned about when they could no longer withstand the popular demands, and have made those very reforms the basis for more spoliation and for a further intrenchment of their power. [Footnote: Commodore Vanderbilt's descendants, the present Vanderbilts, have been using the public outcry for a reform of conditions on the West Side of New York City, precisely as the original Vanderbilt utilized that for the improvement of Fourth avenue. The Hudson River division of the New York Central and Hudson River Railroad has. .h.i.therto extended downtown on the surface of Tenth and Eleventh Avenues and other thoroughfares.

Large numbers of people have been killed and injured. For decades there has been a public demand that these dangerous conditions be remedied or removed. The Vanderbilts have as long resisted the demand; the immense numbers of casualties had no effect upon them.

When the public demand became too strong to be ignored longer, they set about to exploit it in order to get a comprehensive franchise with incalculable new privileges.]

The first step was to get the New York City Common Council to pa.s.s, with an a.s.sumption of indignation, an ordinance requiring Vanderbilt to make the desired improvements, and committing the city to bear one-half the expense and giving him a perpetual franchise. This was in Tweed's time when the Common Council was composed largely of the most corrupt ward heelers, and when Tweed's puppet, Hall, was Mayor.

Public opposition to this grab was so great as to frighten the politicians; at any rate, whatever his reasons, Mayor Hall vetoed the ordinance.

Thereupon, in 1872, Vanderbilt went to the Legislature--that Legislature whose members he had so often bought like so many cattle.

This particular Legislature, however, was elected in 1871, following the revelations of the Tweed "ring" frauds. It was regarded as a "model reform body." As has already been remarked in this work, the pseudo "reform" officials or bodies elected by the American people in the vain hope of overthrowing corruption, will often go to greater lengths in the disposition of the people's rights and interests than the most hardened politicians, because they are not suspected of being corrupt, and their measures have the appearance of being enacted for the public good. The Tweed clique had been broken up, but the capitalists who had a.s.siduously bribed its members and profited so hugely from its political acts, were untouched and in greater power than ever before. The source of all this corruption had not been struck at in the slightest. Tweed, the politician, was sacrificed and went to prison and died there; the capitalists who had corrupted representative bodies everywhere in the United States, before and during his time, were safe and respected, and in a position to continue their work of corruption. Tweed made the cla.s.sic, unforgivable blunder of going into politics as a business, instead of into commercialism. The very capitalists who had profited so greatly by his corruption, were the first to express horror at his acts.

From the "reform" Legislature of 1982 Vanderbilt secured all that he sought. The act was so dexterously worded that while not nominally giving a perpetual franchise, it practically revoked the qualified parts of the charter of 1832. It also compa.s.sionately relieved him of the necessity of having to pay out about $4,000,000, in replacing the dangerous roadway, by imposing that cost upon New York City. Once these improvements were made, Vanderbilt bonded them as though they had been made with private money.

"REFORM" AS IT WORKS OUT.

But these were not his only gifts from the "reform" Legislature. The Harlem Railroad owned, as we have seen, the Fourth avenue surface line of horse cars. Although until this time it extended to Seventy- ninth street only, this line was then the second most profitable in New York City. In 1864, for instance, it carried nearly six million pa.s.sengers, and its gross earnings were $735,000. It did not pay, nor was required to pay, a single cent in taxation. By 1872 the city's population had grown to 950,000. Vanderbilt concluded that the time was fruitful to gather in a few more miles of the public streets.

The Legislature was acquiescent. Chapter 325 of the Laws of 1872 allowed him to extend the line from Seventy-ninth street to as far north as Madison avenue should thereafter be opened. "But see," said the Legislature in effect, "how mindful of the public interests we have been. We have imposed a tax of five per cent, on all gross receipts above Seventy-ninth street." When, however, the time came to collect, Vanderbilt innocently pretended that he had no means of knowing whether the fares were taken in on that section of the line, free of taxation, below Seventy-ninth street, or on the taxed portion above it. Behind that fraudulent subterfuge the city officials have never been inclined to go, nor have they made any effort. As a consequence the only revenue that the city has since received from that line has been a meager few thousand dollars a year.

At the very time that he was watering stock, sliding through legislatures corrupt grants of perpetual franchises, and swindling cities and States out of huge sums in taxes, [Footnote: Not alone he.

In a tabulated report made public on February 1, 1872, the New York Council of Political Reform charged that in the single item of surface railways, New York City for a long period had been swindled annually out of at least a million dollars. This was an underestimate. All other sections of the capitalist cla.s.s swindled likewise in taxes.] Vanderbilt was forcing the drivers and conductors on the Fourth avenue surface line to work an average of fifteen hours out of twenty-four, and reducing their daily wages from $2.25 to $2.

Vanderbilt made the pretense that it was necessary to economize; and, as was the invariable rule of the capitalists, the entire burden of the economizing process was thrown upon the already overloaded workers. This subtraction of twenty-five cents a day entailed upon the drivers and conductors and their families many severe deprivations; working for such low wages every cent obviously counted in the management of household affairs. But the methods of the capitalist cla.s.s in deliberately pyramiding its profits upon the sufferings of the working cla.s.s were evidenced in this case (as they had been, and since have been, in countless other instances) by the announcement in the Wall Street reports that this reduction in wages was followed by an instant rise in the price of the stock of the Fourth avenue surface line. The lower the wages, the greater the dividends.

The further history of the Fourth avenue surface line cannot here be pursued in detail. Suffice to say that the Vanderbilts, in 1894, leased this line for 999 years to the Metropolitan Street Railway Company, controlled by those eminent financiers, William C. Whitney and others, whose monumental briberies, thefts and piracies have frequently been uncovered in official investigations. For almost a thousand years, unless a radical change of conditions comes, the Vanderbilts will draw a princely revenue from the owners.h.i.+p of this franchise alone.

It is not necessary to enter into a narrative of all the laws that Vanderbilt bribed Legislature after Legislature, and Common Council after Common Council, into pa.s.sing--laws giving him for nothing immensely valuable grants of land, sh.o.r.e rights and rights to land under water, more authorizations to make further consolidations and to issue more watered stock. Nor is it necessary to deal with the numerous bills he considered adverse to his interests, that he caused to be smothered in legislative committees by bribery.

VANDERBILT'S CHIEF OF STAFF

His chief instrument during all those years was a general utility lawyer, Chauncey M. Depew, whose specialty was to hoodwink the public by grandiloquent exhibitions of mellifluent spread-eagle oratory, while bringing the "proper arguments" to bear upon legislators and other public officials. [Footnote: Roscoe Conkling, a noted Republican politician, said of him: "Chauncey Depew? Oh, you mean the man that Vanderbilt sends to Albany every winter to say 'haw' and 'gee' to his cattle up there."] Every one who could in any way be used, or whose influence required subsidizing, was, in the phrase of the day, "taken care of." Great sums of money were distributed outright in bribes in the legislatures by lobbyists in Vanderbilt's pay. Supplementing this, an even more insidious system of bribery was carried on. Free pa.s.ses for railroad travel were lavishly distributed; no politician was ever refused; newspaper and magazine editors, writers and reporters were always supplied with free transportation for the asking, thus insuring to a great measure their good will, and putting them under obligations not to criticise or expose plundering schemes or individuals. All railroad companies used this form, as well as other forms, of bribery.

It was mainly by means of the free pa.s.s system that Depew, acting for the Vanderbilts, secured not only a general immunity from newspaper criticism, but continued to have himself and them portrayed in luridly favorable lights. Depending upon the newspapers for its sources of information, the public was constantly deceived and blinded, either by the suppression of certain news, or by its being tampered with and grossly colored. This Depew continued as the wriggling tool of the Vanderbilt family for nearly half a century.

Astonis.h.i.+ng as it may seem, he managed to pa.s.s among the uninformed as a notable man; he was continuously eulogized; at one time he was boomed for the nomination for President of the United States, and in 1905 when the Vanderbilt family decided to have a direct representative in the United States Senate, they ordered the New York State Legislature, which they practically owned, to elect him to that body. It was while he was a United States Senator that the investigations, in 1905, of a committee of the New York Legislature into the affairs of certain life insurance companies revealed that Depew had long since been an advisory party to the gigantic swindles and briberies carried on by Hyde, the founder and head of the Equitable Life a.s.surance Society.

The career of Depew is of no interest to posterity, excepting in so far as it shows anew how the magnates were able to use intermediaries to do their underground work for them, and to put those intermediaries into the highest official positions in the country.

This fact alone was responsible for their elevation to such bodies as the United States Senate, the President's Cabinet and the courts.

Their long service as lobbyists or as retainers was the surest pa.s.sport to high political or judicial position; their express duty was to vote or decide as their masters' interest bid them. So it was (as it is now) that men who had bribed right and left, and who had put their cunning or brains at the complete disposal of the magnates, filled Congress and the courts. These were, to a large extent, the officials by whose votes or decisions all measures of value to the working cla.s.s were defeated; and reversely, by whose actions all or nearly all bills demanded by the money interests, were pa.s.sed and sustained.

Here we are again forced to notice the truism thrusting itself forward so often and conspicuously; that law was essentially made by the great criminals of society, and that, thus far it has been a frightful instrument, based upon force, for legalizing theft on a large scale. By law the great criminals absolve themselves and at the same time declare drastic punishment for the petty criminals. The property obtained by theft is converted into a sacred vested inst.i.tution; the men who commit the theft or their hirelings sit in high places, and pa.s.s laws surrounding the proceeds of that theft with impregnable fortifications of statutes; should any poor devil, goaded on by the exasperations of poverty, venture to help himself to even the tiniest part of that property, the severest penalty, enacted by those same plunderers, is mercilessly visited upon him.

After having bribed legislatures to legalize his enormous issue of watered stock, what was Vanderbilt's next move? The usual fraudulent one of securing exemption from taxation. He and other railroad owners sneaked through law after law by which many of their issues of stock were made non-taxable.

So now old s.h.a.ggy Vanderbilt loomed up the richest magnate in the United States. His ambition was consummated; what mattered it to him that his fortune was begot in blackmail and extortion, bribery and theft? Now that he had his hundred millions he had the means to demand adulation and the semblance of respect, if not respect itself.

The commercial world admired, even while it opposed, him; in his methods it saw at bottom the abler application and extension of its own, and while it felt aggrieved at its own declining importance and power, it rendered homage in the awed, reverential manner in which it viewed his huge fortune.

Over and over again, even to the point of wearisome repet.i.tion, must it be shown, both for the sake of true historical understanding and in justice to the founders of the great fortunes, that all mercantile society was permeated with fraud and subsisted by fraud. But the prevalence of this fraud did not argue its pract.i.tioners to be inherently evil. They were victims of a system inexorably certain to arouse despicable qualities. The memorable difference between the two cla.s.ses was that the workers, as the sufferers, were keenly alive to the abominations of the system, while the capitalists not only insisted upon the right to benefit from its continuance, but harshly sought to repress every attempt of the workers to agitate for its modification or overthrow.

REPRESSION BY STARVATION.

These repressive tactics took on a variety of forms, some of which are not ordinarily included in the definitions of repression.

The usual method was that of subsidizing press and pulpit in certain subtle ways. By these means facts were concealed or distorted, a prejudicial state of public opinion created, and plausible grounds given for hostile interference by the State. But a far more powerful engine of repression was the coercion exercised by employers in forcing their workers to remain submissive on instant peril of losing their jobs. While, at that time, manufacturers, jobbers and shopkeepers throughout the country were rising in angry protest against the acc.u.mulation of plundering power in the hands of such men as Vanderbilt, Gould and Huntington, they were themselves exploiting and bribing on a widespread scale. Their great pose was that of a thorough commercial respectability; it was in this garb that they piously went to legislatures and demanded investigations into the rascally methods of the railroad magnates. The facts, said they, should be made public, so as to base on them appropriate legislation which would curtail the power of such autocrats. Contrasted with the baseness and hypocrisy of the trading cla.s.s, Vanderbilt's qualities of brutal candor and selfishness s.h.i.+ne out as brilliant virtues.

[Footnote: No observation could be truer. As a cla.s.s, the manufacturers were flouris.h.i.+ng on stolen inventions. There might be exceptions, but they were very rare. Year after year, decade after decade, the reports of the various Commissioners of Patents pointed out the indiscriminate theft of inventions by the capitalists. In previous chapters we have referred to the plundering of Whitney and Goodyear. But they were only two of a vast number of inventors similarly defrauded.

In speaking of the helplessness of inventors, J. Holt, Commissioner of Patents, wrote in his Annual Report for 1857: "The insolence and unscrupulousness of capital, subsidizing and leading on its minions in the work of pirating some valuable invention held by powerless hands, can scarcely by conceived by those not familiar with the records of such cases as I have referred to. Inventors, however gifted in other respects, are known to be confiding and thriftless; and being generally without wealth, and always without knowledge of the chicaneries of law, they too often prove but children in those rude conflicts which they are called on to endure with the stalwart fraud and cunning of the world." (U. S. Senate Doc.u.ments, First Session, Thirty-fifth Congress, 1857-58, viii: 9-10). In his Annual Report for 1858, Commissioner Holt described how inventors were at the mercy of professional perjurers whom the capitalists hired to give evidence.

The bribing of Patent office officials was a common occurrence. "The attention of Congress," reported Commissioner of Patents Charles Mason in 1854, "is invited to the importance of providing some adequate means of preventing attempts to obtain patents by improper means." Several cases of "attempted bribery" had occurred within the year, stated Commissioner Mason. (Executive Doc.u.ments, First Session, Thirty-third Congress, 1853-54, Vol. vii, Part I: 19-20.) Every successive Commissioner of Patents called upon Congress to pa.s.s laws for the prevention of fraud, and for the better protection of the inventor, but Congress, influenced by the manufacturers, was deaf to these appeals.]

These same manufacturers objected in the most indignant manner, as they similarly do now, to any legislative investigations of their own methods. Eager to have the practices of Vanderbilt and Gould probed into, they were acrimoniously opposed to even criticism of their factory system. For this extreme sensitiveness there was the amplest reason. The cruelties of the factory system transcended belief. In, for instance, the State of Ma.s.sachusetts, vaunting itself for its progressiveness, enlightenment and culture, the textile factories were a horror beyond description. The Convention of the Boston Eight Hour League, in 1872, did not overstate when it declared of the factory system that "it employs tens of thousands of women and children eleven and twelve hours a day; owns or controls in its own selfish interest the pulpit and the press; prevents the operative cla.s.ses from making themselves felt in behalf of less hours, through remorseless exercise of the power of discharge; and is rearing a population of children and youth of sickly appearance and scanty or utterly neglected schooling."...

As the factory system was in Ma.s.sachusetts, so it was elsewhere. Any employee venturing to agitate for better conditions was instantly discharged; spies were at all times busy among the workers; and if a labor union were formed, the factory owners would obtain sneak emissaries into it, with orders to report on every move and disrupt the union if possible. The factory capitalists in Ma.s.sachusetts, New York, Illinois and every other manufacturing State were determined to keep up their system unchanged, because it was profitable to work children eleven and a half hours a day in a temperature that in summer often reached 108 degrees and in an atmosphere certain to breed immorality; [Footnote: "Certain to breed immorality." See report of Carrol D. Wright, Ma.s.sachusetts Bureau of Statistics of Labor, 1881. A cotton mill operative testified: "Young girls from fourteen and upward learn more wickedness in one year than they would in five out of a mill." See also the numerous recent reports of the National Child Labor Committee.] it was profitable to compel adult men and women having families to work for an average of ninety cents a day; it was profitable to avoid spending money in equipping their factories with life-saving apparatus. Hence these factory owners, forming the aristocracy of trade, savagely fought every move or law that might expose or alter those conditions; the annals of legislative proceedings are full of evidences of bribery.

Having no illusions, and being a severely practical man, Vanderbilt well knew the pretensions of this trading cla.s.s; with many a cynical remark, aptly epitomizing the point, he often made sport of their a.s.sumptions. He knew (and none knew better) that they had dived deep in bribery and fraud; they were the fine gentlemen, he well recalled, who had generally obtained patents by fraud; who had so often bribed members of Congress to vote for a high tariff; the same, too, who had bribed legislatures for charters, water rights, exemptions from taxation, the right to work employees as long as, and under whatever conditions, they wanted to. This manufacturing aristocracy professed to look down upon Vanderbilt socially as a coa.r.s.e sharper; and in New York a certain ruling social element, the native aristocracy, composed of old families whose wealth, originating in fraud, had become respectable by age, took no pains to conceal their opinion of him as a parvenu, and drew about their sacred persons an amusing circle of exclusiveness into the rare precincts of which he might not enter.

Vanderbilt now proceeded to buy social and religious grace as he had bought laws. The purchase of absolution has ever been a convenient and cheap method of obtaining society's condonation of theft. In medieval centuries it took a religious form; it has become transposed to a social traffic in these superior days. Let a man steal in colossal ways and then surrender a small part of it in charitable, religious and educational donations; he at once ceases being a thief and straightway becomes a n.o.ble benefactor. Vanderbilt now shed his life-long irreverence, and gave to Deems, a minister of the Presbyterian Church, as a gift, the Church of the Strangers on Mercer street, and he donated $1,000,000 for the founding of the Vanderbilt University at Nashville, Tenn. The press, the church and the educational world thereupon upon hailed him as a marvel of saintly charity and liberality.

THE SERMONIZING OF THE "BEST CLa.s.sES."

One section of the social organization declined to accept the views of the cla.s.s above it. This was the working cla.s.s. Superimposed upon the working cla.s.s, draining the life blood of the workers to provide them with wealth, luxuries and power, were those upper strata of society known as the "best cla.s.ses." These "best cla.s.ses," with a monstrous presumption, airily proclaimed their superiority and incessantly harped upon the need of elevating and regenerating the ma.s.ses.

And who, it may be curiously asked, were the cla.s.ses self destined or self selected to do this regenerating? The commercial and financial element, with its peculiar morals so adjusted to its interests, that it saw nothing wrong in the conditions by which it reaped its wealth --conditions that made slaves of the workers, threw them into degradation and poverty, drove mult.i.tudes of girls and women into prost.i.tution, and made the industrial field an immense concourse of tears, agony and carnage. Hanging on to this supreme cla.s.s of wealth, fawning to it, licking its very feet, were the parasites and advocates of the press, law, politics, the pulpit, and, with a few exceptions, of the professional occupations. These were the instructors who were to teach the working cla.s.s what morals were; these were the eminences under whose guidance the working cla.s.s was to be uplifted!