1902-1912

THE RISE OF THEODORE ROOSEVELT

Theodore Roosevelt was born in New York City, October 27, 1858.  He was graduated from Harvard in 1880.  At the age of twenty-three he entered the New York State Assembly, where he served six years with great credit.  Two years he was a “cowboy” in Dakota.  He was United States Civil Service Commissioner and President of the New York City Police Board.  In 1897 he became Assistant Secretary of the Navy, holding this position long enough to indite the despatch which took Dewey to Manila.  He then raised the first United States Volunteer Cavalry, commonly spoken of as “Rough Riders,” and went to Cuba as their lieutenant-colonel.  Gallantry at Las Guasimas made him their colonel, the first colonel, Leonard Wood, having received a brigadier-general’s commission.  Returning from the war, Colonel Roosevelt found himself, as by a magic metamorphosis, Governor of his State, fighting civic battles against growing corporate abuses.  He urged compulsory publicity for the affairs of monopolistic combinations, and was prominently instrumental in the enactment of the New York Franchise Tax Law.

The party managers in the 1900 convention hoped by making him Vice-President to remove him from competition for the presidency in 1904.  But the most unexpected of the many swift transitions in his career foiled their calculations and brought him in a moment to the summit of a citizen’s ambition.

The new chief magistrate was no less honest, fearless, or public-spirited than the recent one; it only remained to be seen whether he were not less astute and cautious.  Coming to the office as he did, he was absolutely unfettered, which, in one of so frank a temperament, might prove a danger.  He was more popular with the people than with politicians.  Though highly educated and used to the best associations, he was more approachable than any of his predecessors.  At a public dinner which he attended, one round of cheers was given him as “the President of the United States” another as “Roosevelt,” and a third as “Teddy.”  Had McKinley been in his place a corresponding variation would have been unthinkable.

President Roosevelt’s temper and method were in pointed contrast to McKinley’s.  Whereas McKinley seemed simply to hold the tiller, availing himself of currents that to the eye deviously, yet easily and inevitably, bore him to his objective, Roosevelt strenuously plied the oar, recking little of cross currents or head winds, if, indeed, he did not delight in them.  Chauncey Depew aptly styled McKinley “a Western man with Eastern ideas.”  Roosevelt, “an Eastern man with Western ideas.”  This aspect of the new President’s character gave him hold on both West and East.  Roosevelt was the first President since William Henry Harrison to bring to his office the vigor and freshness of the frontier, as he was, anomalously, the first city-born or wealthy-born incumbent.

The members of President McKinley’s cabinet were invited to retain their portfolios, which they agreed to do.  At the time, Roosevelt was reputed to be the foremost civil service reformer in the country.  Politicians were soon made aware that the President regarded fitness for office as the first test.  Unfortunately during the presidency of McKinley, some 8000 offices had been taken out of the competitive lists.  During Roosevelt’s first term, however, the list of offices placed under the merit system was greatly extended.  Within the twenty-one years from the enactment of the first national civil service reform law wonders had been accomplished in that more than one-half of the 300,000 offices in the executive civil service were placed in the classified competitive service.

President Roosevelt stood for liberal reciprocity with Cuba, urging this, at first, with results disastrous to party harmony.  He was vindicated by public opinion, but learned wisdom.  Though believed to be favorable to a decided easing of custom-house levies, his administration soon frankly avowed itself unable to proceed further than high-protectionists would follow.  The evidence of his tariff convictions won him strong support in the West, which was prepared to go greater lengths than he.  In the congressional campaign of 1902, ex-Speaker Henderson, of Iowa, a stanch protectionist, withdrew from public life, as was supposed, rather than misrepresent himself by acceding to tariff reform or his constituents by opposing it.

Mr. Roosevelt signalized his accession by an effort to make the federal anti-trust law something more than a cumberer of the statute-book.  His inaugural message and innumerable addresses of his boldly handled the whole trust evil and called for the regulation of capitalistic combinations in the interest of the public.

Appreciation of the President’s attitude on these matters may be assisted by some notice of the then threatening vigor and universality of the movement toward industrial combination.  Mr. Beck, Assistant Attorney-General of the United States, declared in 1892: 

“Excessive capitalization of corporations, dishonest management by their executive officers, the destruction of the rights of the minority, the theft of public utilities, the subordination of public interests to private gain, the debauchery of our local legislatures and executive officers, and the corruption of the elective franchise, have resulted from the facility afforded by the law to corporations to concentrate the control of colossal wealth in the hands of a few men . . . .  The question presses ever more importunately for decision whether these marvellous aggregations of capital can be subordinated to the very laws which created them.”

Legislation in many States, the enactment of the Sherman anti-trust law by Congress, and the decision of the Supreme Court in the Trans-Missouri case rendered insecure trust agreements of the old type, in which constituent corporations surrendered the control of their affairs to trustees.  But the current merely shifted to a different channel, the trust proper giving way to the giant corporation having the same aims, methods, and efficiency, while, as more legal, it was less vulnerable.

In the railway world, “community of interest” assumed the place of pooling agreements.  The Union Pacific acquired large holdings from Collis P. Huntington’s estate and controlled the Southern Pacific.  The power behind the Southern Railway got control of nearly all the other Southern railways, including the Atlantic Coast Line, the Plant System, and at last even the Louisville and Nashville.  The New York Central dominated the other Vanderbilt roads.  The Pennsylvania secured decisive amounts of Baltimore and Ohio stock, as well as weighty interests in the Chesapeake and Ohio and the Norfolk and Western, and so on.

Great banking establishments, foremost among them the house of J. P. Morgan & Co., took to financing these schemes.  Morgan re-organized the Northern Pacific, and it would forthwith have pooled issues with the Great Northern but for opposition by the State of Minnesota.  James J. Hill was master of the Great Northern, and confidence existed between him and Morgan.

They wished a secure outlet for the products of the Northwest, also access to Chicago over a line of their own.  After a survey of the field the promoters selected as the most available for the latter office the Chicago, Burlington and Quincy.  Purchase of shares in this corporation was quietly begun.  Soon the Burlington road was apparently in hand.  Prices rose.

The Union Pacific control perceived in the aggression of the two northern lines a menace to its northwestern and Pacific coast connections.  The Union Pacific leader, E. H. Harriman, resorted to an unexpected coup.  He attempted to purchase the Northern Pacific, Burlington and all.  A mysterious demand, set Northern Pacific shares soaring.  The stock reached $1,000 a share and none was obtainable.  Panic arose; bankers and brokers faced ruin.

The two sides now declared a truce.  The Northern Securities Company was created, with a capital approaching a billion dollars, to take over the Burlington, Northern Pacific, and Great Northern stocks.

The States of Minnesota and Washington, unable in their own courts to thwart this plan, sought the intervention of the United States Supreme Court.  Their suit was vain till the Administration came to the rescue.  At the instance of the Attorney-General, an injunction issued from the high court named forbidding the Securities Company to receive the control of the roads, and the holders of the railroad stocks involved to give it over.  It was observed, however, that at the very time of the above proceedings the Southern Railways’ power obtained control of the Louisville and Nashville without jar or judicial obstruction.

While general, the process of confederation was specially conspicuous in the iron and steel trade.  In rapid succession the National Steel Company, the American Sheet Steel Company, and the American Tin Plate Company were each made up of numerous smaller plants.  Each of these corporations, with a capital from $12,000,000 to $40,000,000, owned the mines, the ships, and the railways for hauling its products, the mills for manufacturing, and the agencies for sale.  Through the efforts of John W. Gates numerous wire and nail works were combined into the American Steel and Wire Company.  The Federal Steel Company, the American Bridge Company, the Republic Iron and Steel Company, huge and complete, were dictators each in its field.

The Carnegie Steel Company long remained independent.  Determined not to enter a “combine,” Andrew Carnegie sought to fortify his position.  He obtained a fleet of ships upon the lakes, purchased mines, undertook to construct tube works at Conneaut, Ohio, and planned for railroads.  A battle of the giants, with loss and possible ruin for one side or the other, impended.  Carnegie was finally willing to sell.  Hence, the United States Steel Corporation capitalized for a billion dollars.  Carnegie and his partners were said to receive about $300,000,000 in bonds of the new corporation, while the other trusts and the promoters absorbed the stock for their properties and services.  The underwriting syndicate probably realized $25,000,000.

The trust creators extended their operations abroad.  In 1901 J. Pierpont Morgan and associates acquired the Leyland line of Atlantic steamships.  British nerves had not recovered tone when a steamship combination, embracing not only American and British but also German lines and ship-building firms at Belfast and on the Clyde was announced.  Of the great Atlantic companies, only the Cunard line remained independent.  Parliamentary and ministerial assurances of governmental attention only emphasized the strength of the association.

One effect of this organization at home was to place the Ship Subsidy Bill, which passed the Senate in 1901, for the time, at least, on the table.  The sentiment of the country, especially of the Middle West, would not permit the payment of public money to a concern commercially able to defy Britannia on the sea.

The Yankee Peril confronted Londoners when they saw American capital securing control of their proposed underground transit system.  At their tables they beheld the output of food trusts.  One of these, the so-called Beef Trust, called down upon itself in 1902 domestic as well as foreign anathema.

The failure of the corn crop in 1900, together with a scarcity of cattle, tended to raise the price of beef.  In 1902 outcry became emphatic.  Advance in meat values drew forcibly to view the control held by six slaughtering concerns acting in unison.

The President ordered an investigation, and, as a result, proceedings under the Sherman Act to restrain the great packers from continuing their alleged combination.  A temporary injunction was granted.  The slow machinery of chancery bade fair to work out a decree, but long before it was on record, alert spirits among the packing firms evolved a new plan not obnoxious to decrees, but effective for union.

If the public suffered from these phalanxed industries while they ran smoothly, it endured peculiar evils from the periodical conflicts between the capital and the labor engaged in them.

The Steel Strike of 1901 was a conflict over the unionizing of certain hitherto non-union plants of the United States Steel Corporation.  It resulted in defeat for the strikers and in the disunionizing of plants.

This strike had no such consequences for the consuming public as attended the anthracite coal strike of 1902, which was more bitterly fought in that it was a conflict over wages.  The standard of living had been lowered in one of the coal-fields by the introduction of cheap foreign labor.  Now the same process threatened the other coal-field.

A strike ordered by the United Mine Workers began May 12, 1902, when one hundred and forty-seven thousand miners went out.  Though the record was marred at places, they behaved well and retained to a large degree public sympathy.  When the price of anthracite rose from about $5 a ton to $28 and $30, the parts of the country using hard coal were threatened with a fuel famine and had begun to realize it.  For the five months ending October 12th, the strike was estimated to have cost over $126,000,000.  The operators stubbornly refused to arbitrate or to recognize the union, and the miners, with equal constancy, held their ranks intact.

The problem of protecting the public pressed for solution as never before.  The only suggestion at first discussed was arbitration.  Enforced arbitration could not be effected in the absence of contract without infringing the workingman’s right to labor or to decline to do so; in other words, without reducing him, in case of adverse decision by arbitration, to a condition of involuntary servitude.  It looked as though no solution would be reached unless State or nation should condemn and acquire ample portions of the mining lands to be worked under its own auspices and in a just manner.  This course was suggested, but nearly all deemed it dangerously radical; nor was it as yet likely to be adopted by Congress or by the Pennsylvania legislature, should these powers be called to deal with the problem.

On October 3 President Roosevelt called the coal operators and President Mitchell of the United Mine Workers to a conference at the White House, urging them to agree.  His effort, at first seeming unsuccessful, was much criticised, but very few failed to praise it when, a few days later, it was found to have succeeded completely.  An able and impartial commission, satisfactory to both sides, was appointed by the President to act as arbitrator, both miners and operators agreeing to abide its decrees.  The miners, the four hundred thousand women and children dependent on them, the poor beginning to suffer from cold, indeed the whole nation, including, no doubt, the operators, felt relief.

“How much better,” said the young President, once, addressing a fashionable assembly, “boldly to attempt remedying a bad situation than to sit quietly in one’s retreat, sigh, and think how good it would be if the situation could be remedied!”