COOePERATION BETWEEN EMPLOYERS AND EMPLOYEES

Company Unions.—The changed economic life described by the three eminent men just quoted was acknowledged by several great companies and business concerns. All over the country decided efforts were made to bridge the gulf which industry and the corporation had created. Among the devices adopted was that of the "company union." In one of the Western lumber mills, for example, all the employees were invited to join a company organization; they held monthly meetings to discuss matters of common concern; they elected a "shop committee" to confer with the representatives of the company; and periodically the agents of the employers attended the conferences of the men to talk over matters of mutual interest. The function of the shop committee was to consider wages, hours, safety rules, sanitation, recreation and other problems. Whenever any employee had a grievance he took it up with the foreman and, if it was not settled to his satisfaction, he brought it before the shop committee. If the members of the shop committee decided in favor of the man with a grievance, they attempted to settle the matter with the company's agents. All these things failing, the dispute was transferred to a grand meeting of all the employees with the employers' representatives, in common council. A deadlock, if it ensued from such a conference, was broken by calling in impartial arbitrators selected by both sides from among citizens outside the mill. Thus the employees were given a voice in all decisions affecting their work and welfare; rights and grievances were treated as matters of mutual interest rather than individual concern. Representatives of trade unions from outside, however, were rigidly excluded from all negotiations between employers and the employees.

Profit-sharing.—Another proposal for drawing capital and labor together was to supplement the wage system by other ties. Sometimes lump sums were paid to employees who remained in a company's service for a definite period of years. Again they were given a certain percentage of the annual profits. In other instances, employees were allowed to buy stock on easy terms and thus become part owners in the concern. This last plan was carried so far by a large soap manufacturing company that the employees, besides becoming stockholders, secured the right to elect representatives to serve on the board of directors who managed the entire business. So extensive had profit-sharing become by 1914 that the Federal Industrial Relations Committee, appointed by the President, deemed it worthy of a special study. Though opposed by regular trade unions, it was undoubtedly growing in popularity.

Labor Managers and Welfare Work.—Another effort of employers to meet the problems of the new age appeared in the appointment of specialists, known as employment managers, whose task it was to study the relations existing between masters and workers and discover practical methods for dealing with each grievance as it arose. By 1918, hundreds of big companies had recognized this modern "profession" and universities were giving courses of instruction on the subject to young men and women. In that year a national conference of employment managers was held at Rochester, New York. The discussion revealed a wide range of duties assigned to managers, including questions of wages, hours, sanitation, rest rooms, recreational facilities, and welfare work of every kind designed to make the conditions in mills and factories safer and more humane. Thus it was evident that hundreds of employers had abandoned the old idea that they were dealing merely with individual employees and that their obligations ended with the payment of any wages they saw fit to fix. In short, they were seeking to develop a spirit of cooeperation to take the place of competition and enmity; and to increase the production of commodities by promoting the efficiency and happiness of the producers.

THE RISE AND GROWTH OF ORGANIZED LABOR

The American Federation of Labor.—Meanwhile a powerful association of workers representing all the leading trades and crafts, organized into unions of their own, had been built up outside the control of employers. This was the American Federation of Labor, a nation-wide union of unions, founded in 1886 on the basis of beginnings made five years before. At the time of its establishment it had approximately 150,000 members. Its growth up to the end of the century was slow, for the total enrollment in 1900 was only 300,000. At that point the increase became marked. The membership reached 1,650,000 in 1904 and more than 3,000,000 in 1919. To be counted in the ranks of organized labor were several strong unions, friendly to the Federation, though not affiliated with it. Such, for example, were the Railway Brotherhoods with more than half a million members. By the opening of 1920 the total strength of organized labor was put at about 4,000,000 members, meaning, if we include their families, that nearly one-fifth of the people of the United States were in some positive way dependent upon the operations of trade unions.

Historical Background.—This was the culmination of a long and significant history. Before the end of the eighteenth century, the skilled workmen—printers, shoemakers, tailors, and carpenters—had, as we have seen, formed local unions in the large cities. Between 1830 and 1860, several aggressive steps were taken in the American labor movement. For one thing, the number of local unions increased by leaps and bounds in all the industrial towns. For another, there was established in every large manufacturing city a central labor body composed of delegates from the unions of the separate trades. In the local union the printers or the cordwainers, for example, considered only their special trade problems. In the central labor union, printers, cordwainers, iron molders, and other craftsmen considered common problems and learned to cooeperate with one another in enforcing the demands of each craft. A third step was the federation of the unions of the same craftsmen in different cities. The printers of New York, Philadelphia, Boston, and other towns, for instance, drew together and formed a national trade union of printers built upon the local unions of that craft. By the eve of the Civil War there were four or five powerful national unions of this character. The expansion of the railway made travel and correspondence easier and national conventions possible even for workmen of small means. About 1834 an attempt was made to federate the unions of all the different crafts into a national organization; but the effort was premature.

The National Labor Union.—The plan which failed in 1834 was tried again in the sixties. During the war, industries and railways had flourished as never before; prices had risen rapidly; the demand for labor had increased; wages had mounted slowly, but steadily. Hundreds of new local unions had been founded and eight or ten national trade unions had sprung into being. The time was ripe, it seemed, for a national consolidation of all labor's forces; and in 1866, the year after the surrender of General Lee at Appomattox, the "National Labor Union" was formed at Baltimore under the leadership of an experienced organizer, W.H. Sylvis of the iron molders. The purpose of the National Labor Union was not merely to secure labor's standard demands touching hours, wages, and conditions of work or to maintain the gains already won. It leaned toward political action and radical opinions. Above all, it sought to eliminate the conflict between capital and labor by making workingmen the owners of shops through the formation of cooeperative industries. For six years the National Labor Union continued to hold conferences and carry on its propaganda; but most of the cooeperative enterprises failed, political dissensions arose, and by 1872 the experiment had come to an end.

The Knights of Labor.—While the National Labor Union was experimenting, there grew up in the industrial world a more radical organization known as the "Noble Order of the Knights of Labor." It was founded in Philadelphia in 1869, first as a secret society with rituals, signs, and pass words; "so that no spy of the boss can find his way into the lodge room to betray his fellows," as the Knights put it. In form the new organization was simple. It sought to bring all laborers, skilled and unskilled, men and women, white and colored, into a mighty body of local and national unions without distinction of trade or craft. By 1885, ten years after the national organization was established, it boasted a membership of over 700,000. In philosophy, the Knights of Labor were socialistic, for they advocated public ownership of the railways and other utilities and the formation of cooeperative societies to own and manage stores and factories.

As the Knights were radical in spirit and their strikes, numerous and prolonged, were often accompanied by violence, the organization alarmed employers and the general public, raising up against itself a vigorous opposition. Weaknesses within, as well as foes from without, started the Knights on the path to dissolution. They waged more strikes than they could carry on successfully; their cooeperative experiments failed as those of other labor groups before them had failed; and the rank and file could not be kept in line. The majority of the members wanted immediate gains in wages or the reduction of hours; when their hopes were not realized they drifted away from the order. The troubles were increased by the appearance of the American Federation of Labor, a still mightier organization composed mainly of skilled workers who held strategic positions in industry. When they failed to secure the effective support of the Federation in their efforts to organize the unskilled, the employers closed in upon them; then the Knights declined rapidly in power. By 1890 they were a negligible factor and in a short time they passed into the limbo of dead experiments.

The Policies of the American Federation.—Unlike the Knights of Labor, the American Federation of Labor sought, first of all, to be very practical in its objects and methods. It avoided all kinds of socialistic theories and attended strictly to the business of organizing unions for the purpose of increasing wages, shortening hours, and improving working conditions for its members. It did not try to include everybody in one big union but brought together the employees of each particular craft whose interests were clearly the same. To prepare for strikes and periods of unemployment, it raised large funds by imposing heavy dues and created a benefit system to hold men loyally to the union. In order to permit action on a national scale, it gave the superior officers extensive powers over local unions.

While declaring that employers and employees had much in common, the Federation strongly opposed company unions. Employers, it argued, were affiliated with the National Manufacturers' Association or with similar employers' organizations; every important industry was now national in scope; and wages and hours, in view of competition with other shops, could not be determined in a single factory, no matter how amicable might be the relations of the company and its workers in that particular plant. For these reasons, the Federation declared company unions and local shop committees inherently weak; it insisted that hours, wages, and other labor standards should be fixed by general trade agreements applicable to all the plants of a given industry, even if subject to local modifications.

At the same time, the Federation, far from deliberately antagonizing employers, sought to enlist their cooeperation and support. It affiliated with the National Civic Federation, an association of business men, financiers, and professional men, founded in 1900 to promote friendly relations in the industrial world. In brief, the American Federation of Labor accepted the modern industrial system and, by organization within it, endeavored to secure certain definite terms and conditions for trade unionists.

THE WIDER RELATIONS OF ORGANIZED LABOR

The Socialists.—The trade unionism "pure and simple," espoused by the American Federation of Labor, seemed to involve at first glance nothing but businesslike negotiations with employers. In practice it did not work out that way. The Federation was only six years old when a new organization, appealing directly for the labor vote—namely, the Socialist Labor Party—nominated a candidate for President, launched into a national campaign, and called upon trade unionists to desert the older parties and enter its fold.

The socialistic idea, introduced into national politics in 1892, had been long in germination. Before the Civil War, a number of reformers, including Nathaniel Hawthorne, Horace Greeley, and Wendell Phillips, deeply moved by the poverty of the great industrial cities, had earnestly sought relief in the establishment of cooeperative or communistic colonies. They believed that people should go into the country, secure land and tools, own them in common so that no one could profit from exclusive ownership, and produce by common labor the food and clothing necessary for their support. For a time this movement attracted wide interest, but it had little vitality. Nearly all the colonies failed. Selfishness and indolence usually disrupted the best of them.

In the course of time this "Utopian" idea was abandoned, and another set of socialist doctrines, claiming to be more "scientific," appeared instead. The new school of socialists, adopting the principles of a German writer and agitator, Karl Marx, appealed directly to workingmen. It urged them to unite against the capitalists, to get possession of the machinery of government, and to introduce collective or public ownership of railways, land, mines, mills, and other means of production. The Marxian socialists, therefore, became political. They sought to organize labor and to win elections. Like the other parties they put forward candidates and platforms. The Socialist Labor party in 1892, for example, declared in favor of government ownership of utilities, free school books, woman suffrage, heavy income taxes, and the referendum. The Socialist party, founded in 1900, with Eugene V. Debs, the leader of the Pullman strike, as its candidate, called for public ownership of all trusts, monopolies, mines, railways; and the chief means of production. In the course of time the vote of the latter organization rose to considerable proportions, reaching almost a million in 1912. It declined four years later and then rose in 1920 to about the same figure.

In their appeal for votes, the socialists of every type turned first to labor. At the annual conventions of the American Federation of Labor they besought the delegates to endorse socialism. The president of the Federation, Samuel Gompers, on each occasion took the floor against them. He repudiated socialism and the socialists, on both theoretical and practical grounds. He opposed too much public ownership, declaring that the government was as likely as any private employer to oppress labor. The approval of socialism, he maintained, would split the Federation on the rock of politics, weaken it in its fight for higher wages and shorter hours, and prejudice the public against it. At every turn he was able to vanquish the socialists in the Federation, although he could not prevent it from endorsing public ownership of the railways at the convention of 1920.

The Extreme Radicals.—Some of the socialists, defeated in their efforts to capture organized labor and seeing that the gains in elections were very meager, broke away from both trade unionism and politics. One faction, the Industrial Workers of the World, founded in 1905, declared themselves opposed to all capitalists, the wages system, and craft unions. They asserted that the "working class and the employing class have nothing in common" and that trade unions only pitted one set of workers against another set. They repudiated all government ownership and the government itself, boldly proclaiming their intention to unite all employees into one big union and seize the railways, mines, and mills of the country. This doctrine, so revolutionary in tone, called down upon the extremists the condemnation of the American Federation of Labor as well as of the general public. At its convention in 1919, the Federation went on record as "opposed to Bolshevism, I.W.W.-ism, and the irresponsible leadership that encourages such a policy." It announced its "firm adherence to American ideals."

The Federation and Political Issues.—The hostility of the Federation to the socialists did not mean, however, that it was indifferent to political issues or political parties. On the contrary, from time to time, at its annual conventions, it endorsed political and social reforms, such as the initiative, referendum, and recall, the abolition of child labor, the exclusion of Oriental labor, old-age pensions, and government ownership. Moreover it adopted the policy of "rewarding friends and punishing enemies" by advising members to vote for or against candidates according to their stand on the demands of organized labor.



This policy was pursued with especial zeal in connection with disputes over the use of injunctions in labor controversies. An injunction is a bill or writ issued by a judge ordering some person or corporation to do or to refrain from doing something. For example, a judge may order a trade union to refrain from interfering with non-union men or to continue at work handling goods made by non-union labor; and he may fine or imprison those who disobey his injunction, the penalty being inflicted for "contempt of court." This ancient legal device came into prominence in connection with nation-wide railway strikes in 1877. It was applied with increasing frequency after its effective use against Eugene V. Debs in the Pullman strike of 1894.

Aroused by the extensive use of the writ, organized labor demanded that the power of judges to issue injunctions in labor disputes be limited by law. Representatives of the unions sought support from the Democrats and the Republicans; they received from the former very specific and cordial endorsement. In 1896 the Democratic platform denounced "government by injunction as a new and highly dangerous form of oppression." Mr. Gompers, while refusing to commit the Federation to Democratic politics, privately supported Mr. Bryan. In 1908, he came out openly and boasted that eighty per cent of the votes of the Federation had been cast for the Democratic candidate. Again in 1912 the same policy was pursued. The reward was the enactment in 1914 of a federal law exempting trade unions from prosecution as combinations in restraint of trade, limiting the use of the injunction in labor disputes, and prescribing trial by jury in case of contempt of court. This measure was hailed by Mr. Gompers as the "Magna Carta of Labor" and a vindication of his policy. As a matter of fact, however, it did not prevent the continued use of injunctions against trade unions. Nevertheless Mr. Gompers was unshaken in his conviction that organized labor should not attempt to form an independent political party or endorse socialist or other radical economic theories.

Organized Labor and the Public.—Besides its relations to employers, radicals within its own ranks, and political questions, the Federation had to face responsibilities to the general public. With the passing of time these became heavy and grave. While industries were small and conflicts were local in character, a strike seldom affected anybody but the employer and the employees immediately involved in it. When, however, industries and trade unions became organized on a national scale and a strike could paralyze a basic enterprise like coal mining or railways, the vital interests of all citizens were put in jeopardy. Moreover, as increases in wages and reductions in hours often added directly to the cost of living, the action of the unions affected the well-being of all—the food, clothing, and shelter of the whole people.

For the purpose of meeting the issue raised by this state of affairs, it was suggested that employers and employees should lay their disputes before commissions of arbitration for decision and settlement. President Cleveland, in a message of April 2, 1886, proposed such a method for disposing of industrial controversies, and two years later Congress enacted a voluntary arbitration law applicable to the railways. The principle was extended in 1898 and again in 1913, and under the authority of the federal government many contentions in the railway world were settled by arbitration.

The success of such legislation induced some students of industrial questions to urge that unions and employers should be compelled to submit all disputes to official tribunals of arbitration. Kansas actually passed such a law in 1920. Congress in the Esch-Cummins railway bill of the same year created a federal board of nine members to which all railway controversies, not settled by negotiation, must be submitted. Strikes, however, were not absolutely forbidden. Generally speaking, both employers and employees opposed compulsory adjustments without offering any substitute in case voluntary arbitration should not be accepted by both parties to a dispute.

IMMIGRATION AND AMERICANIZATION

The Problems of Immigration.—From its very inception, the American Federation of Labor, like the Knights of Labor before it, was confronted by numerous questions raised by the ever swelling tide of aliens coming to our shores. In its effort to make each trade union all-inclusive, it had to wrestle with a score or more languages. When it succeeded in thoroughly organizing a craft, it often found its purposes defeated by an influx of foreigners ready to work for lower wages and thus undermine the foundations of the union.

At the same time, persons outside the labor movement began to be apprehensive as they contemplated the undoubted evil, as well as the good, that seemed to be associated with the "alien invasion." They saw whole sections of great cities occupied by people speaking foreign tongues, reading only foreign newspapers, and looking to the Old World alone for their ideas and their customs. They witnessed an expanding army of total illiterates, men and women who could read and write no language at all; while among those aliens who could read few there were who knew anything of American history, traditions, and ideals. Official reports revealed that over twenty per cent of the men of the draft army during the World War could not read a newspaper or write a letter home. Perhaps most alarming of all was the discovery that thousands of alien men are in the United States only on a temporary sojourn, solely to make money and return home with their savings. These men, willing to work for low wages and live in places unfit for human beings, have no stake in this country and do not care what becomes of it.

The Restriction of Immigration.—In all this there was, strictly speaking, no cause for surprise. Since the foundation of our republic the policy of the government had been to encourage the coming of the alien. For nearly one hundred years no restraining act was passed by Congress, while two important laws positively encouraged it; namely, the homestead act of 1862 and the contract immigration law of 1864. Not until American workingmen came into open collision with cheap Chinese labor on the Pacific Coast did the federal government spread the first measure of limitation on the statute books. After the discovery of gold, and particularly after the opening of the railway construction era, a horde of laborers from China descended upon California. Accustomed to starvation wages and indifferent to the conditions of living, they threatened to cut the American standard to the point of subsistence. By 1876 the protest of American labor was loud and long and both the Republicans and the Democrats gave heed to it. In 1882 Congress enacted a law prohibiting the admission of Chinese laborers to the United States for a term of ten years—later extended by legislation. In a little while the demand arose for the exclusion of the Japanese as well. In this case no exclusion law was passed; but an understanding was reached by which Japan agreed not to issue passports to her laborers authorizing them to come to the United States. By act of Congress in 1907 the President was empowered to exclude any laborers who, having passports to Canada, Hawaii, or Mexico, attempted to enter our country.

These laws and agreements, however, did not remove all grounds for the agitation of the subject. They were difficult to enforce and it was claimed by residents of the Coast that in spite of federal authority Oriental laborers were finding their way into American ports. Moreover, several Western states, anxious to preserve the soil for American ownership, enacted laws making it impossible for Chinese and Japanese to buy land outright; and in other ways they discriminated against Orientals. Such proceedings placed the federal government in an embarrassing position. By treaty it had guaranteed specific rights to Japanese citizens in the United States, and the government at Tokyo contended that the state laws just cited violated the terms of the international agreement. The Western states were fixed in their determination to control Oriental residents; Japan was equally persistent in asking that no badge of inferiority be attached to her citizens. Subjected to pressure on both sides, the federal government sought a way out of the deadlock.

Having embarked upon the policy of restriction in 1882, Congress readily extended it. In that same year it barred paupers, criminals, convicts, and the insane. Three years later, mainly owing to the pressure of the Knights of Labor, it forbade any person, company, or association to import aliens under contract. By an act of 1887, the contract labor restriction was made even more severe. In 1903, anarchists were excluded and the bureau of immigration was transferred from the Treasury Department to the Department of Commerce and Labor, in order to provide for a more rigid execution of the law. In 1907 the classes of persons denied admission were widened to embrace those suffering from physical and mental defects and otherwise unfit for effective citizenship. When the Department of Labor was established in 1913 the enforcement of the law was placed in the hands of the Secretary of Labor, W.B. Wilson, who was a former leader in the American Federation of Labor.

The Literacy Test.—Still the advocates of restriction were not satisfied. Still organized labor protested and demanded more protection against the competition of immigrants. In 1917 it won a thirty-year battle in the passage of a bill excluding "all aliens over sixteen years of age, physically capable of reading, who cannot read the English language or some other language or dialect, including Hebrew or Yiddish." Even President Wilson could not block it, for a two-thirds vote to overcome his veto was mustered in Congress.

This act, while it served to exclude illiterates, made no drastic cut in the volume of immigration. Indeed a material reduction was resolutely opposed in many quarters. People of certain nationalities already in the United States objected to every barrier that shut out their own kinsmen. Some Americans of the old stock still held to the idea that the United States should continue to be an asylum for "the oppressed of the earth." Many employers looked upon an increased labor supply as the means of escaping what they called "the domination of trade unions." In the babel of countless voices, the discussion of these vital matters went on in town and country.

Americanization.—Intimately connected with the subject of immigration was a call for the "Americanization" of the alien already within our gates. The revelation of the illiteracy in the army raised the cry and the demand was intensified when it was found that many of the leaders among the extreme radicals were foreign in birth and citizenship. Innumerable programs for assimilating the alien to American life were drawn up, and in 1919 a national conference on the subject was held in Washington under the auspices of the Department of the Interior. All were agreed that the foreigner should be taught to speak and write the language and understand the government of our country. Congress was urged to lend aid in this vast undertaking. America, as ex-President Roosevelt had said, was to find out "whether it was a nation or a boarding-house."

General References

J.R. Commons and Associates, History of Labor in the United States (2 vols.).

Samuel Gompers, Labor and the Common Welfare.

W.E. Walling, Socialism as It Is.

W.E. Walling (and Others), The Socialism of Today.

R.T. Ely, The Labor Movement in America.

T.S. Adams and H. Sumner, Labor Problems.

J.G. Brooks, American Syndicalism and Social Unrest.

P.F. Hall, Immigration and Its Effects on the United States.

Research Topics

The Rise of Trade Unionism.—Mary Beard, Short History of the American Labor Movement, pp. 10-18, 47-53, 62-79; Carlton, Organized Labor in American History, pp. 11-44.

Labor and Politics.—Beard, Short History, pp. 33-46, 54-61, 103-112; Carlton, pp. 169-197; Ogg, National Progress (American Nation Series), pp. 76-85.

The Knights of Labor.—Beard, Short History, pp. 116-126; Dewey, National Problems (American Nation Series), pp. 40-49.

The American Federation of Labor—Organization and Policies.—Beard, Short History, pp. 86-112.

Organized Labor and the Socialists.—Beard, Short History, pp. 126-149.

Labor and the Great War.—Carlton, pp. 282-306; Beard, Short History, pp. 150-170.

Questions

1. What are the striking features of the new economic age?

2. Give Mr. Rockefeller's view of industrial democracy.

3. Outline the efforts made by employers to establish closer relations with their employees.

4. Sketch the rise and growth of the American Federation of Labor.

5. How far back in our history does the labor movement extend?

6. Describe the purposes and outcome of the National Labor Union and the Knights of Labor.

7. State the chief policies of the American Federation of Labor.

8. How does organized labor become involved with outside forces?

9. Outline the rise of the socialist movement. How did it come into contact with the American Federation?

10. What was the relation of the Federation to the extreme radicals? To national politics? To the public?

11. Explain the injunction.

12. Why are labor and immigration closely related?

13. Outline the history of restrictions on immigration.

14. What problems arise in connection with the assimilation of the alien to American life?



CHAPTER XXV

PRESIDENT WILSON AND THE WORLD WAR

"The welfare, the happiness, the energy, and the spirit of the men and women who do the daily work in our mines and factories, on our railroads, in our offices and ports of trade, on our farms, and on the sea are the underlying necessity of all prosperity." Thus spoke Woodrow Wilson during his campaign for election. In this spirit, as President, he gave the signal for work by summoning Congress in a special session on April 7, 1913. He invited the cooeperation of all "forward-looking men" and indicated that he would assume the role of leadership. As an evidence of his resolve, he appeared before Congress in person to read his first message, reviving the old custom of Washington and Adams. Then he let it be known that he would not give his party any rest until it fulfilled its pledges to the country. When Democratic Senators balked at tariff reductions, they were sharply informed that the party had plighted its word and that no excuses or delays would be tolerated.

DOMESTIC LEGISLATION

Financial Measures.—Under this spirited leadership Congress went to work, passing first the Underwood tariff act of 1913, which made a downward revision in the rates of duty, fixing them on the average about twenty-six per cent lower than the figures of 1907. The protective principle was retained, but an effort was made to permit a moderate element of foreign competition. As a part of the revenue act Congress levied a tax on incomes as authorized by the sixteenth amendment to the Constitution. The tax which roused such party passions twenty years before was now accepted as a matter of course.

Having disposed of the tariff, Congress took up the old and vexatious currency question and offered a new solution in the form of the federal reserve law of December, 1913. This measure, one of the most interesting in the history of federal finance, embraced four leading features. In the first place, it continued the prohibition on the issuance of notes by state banks and provided for a national currency. In the second place, it put the new banking system under the control of a federal reserve board composed entirely of government officials. To prevent the growth of a "central money power," it provided, in the third place, for the creation of twelve federal reserve banks, one in each of twelve great districts into which the country is divided. All local national banks were required and certain other banks permitted to become members of the new system and share in its control. Finally, with a view to expanding the currency, a step which the Democrats had long urged upon the country, the issuance of paper money, under definite safeguards, was authorized.

Mindful of the agricultural interest, ever dear to the heart of Jefferson's followers, the Democrats supplemented the reserve law by the Farm Loan Act of 1916, creating federal agencies to lend money on farm mortgages at moderate rates of interest. Within a year $20,000,000 had been lent to farmers, the heaviest borrowing being in nine Western and Southern states, with Texas in the lead.

Anti-trust Legislation.—The tariff and currency laws were followed by three significant measures relative to trusts. Rejecting utterly the Progressive doctrine of government regulation, President Wilson announced that it was the purpose of the Democrats "to destroy monopoly and maintain competition as the only effective instrument of business liberty." The first step in this direction, the Clayton Anti-trust Act, carried into great detail the Sherman law of 1890 forbidding and penalizing combinations in restraint of interstate and foreign trade. In every line it revealed a determined effort to tear apart the great trusts and to put all business on a competitive basis. Its terms were reinforced in the same year by a law creating a Federal Trade Commission empowered to inquire into the methods of corporations and lodge complaints against concerns "using any unfair method of competition." In only one respect was the severity of the Democratic policy relaxed. An act of 1918 provided that the Sherman law should not apply to companies engaged in export trade, the purpose being to encourage large corporations to enter foreign commerce.

The effect of this whole body of anti-trust legislation, in spite of much labor on it, remained problematical. Very few combinations were dissolved as a result of it. Startling investigations were made into alleged abuses on the part of trusts; but it could hardly be said that huge business concerns had lost any of their predominance in American industry.

Labor Legislation.—By no mere coincidence, the Clayton Anti-trust law of 1914 made many concessions to organized labor. It declared that "the labor of a human being is not a commodity or an article of commerce," and it exempted unions from prosecution as "combinations in restraint of trade." It likewise defined and limited the uses which the federal courts might make of injunctions in labor disputes and guaranteed trial by jury to those guilty of disobedience (see p. 581).

The Clayton law was followed the next year by the Seamen's Act giving greater liberty of contract to American sailors and requiring an improvement of living conditions on shipboard. This was such a drastic law that shipowners declared themselves unable to meet foreign competition under its terms, owing to the low labor standards of other countries.

Still more extraordinary than the Seamen's Act was the Adamson law of 1916 fixing a standard eight-hour work-day for trainmen on railroads—a measure wrung from Congress under a threat of a great strike by the four Railway Brotherhoods. This act, viewed by union leaders as a triumph, called forth a bitter denunciation of "trade union domination," but it was easier to criticize than to find another solution of the problem.

Three other laws enacted during President Wilson's administration were popular in the labor world. One of them provided compensation for federal employees injured in the discharge of their duties. Another prohibited the labor of children under a certain age in the industries of the nation. A third prescribed for coal miners in Alaska an eight-hour day and modern safeguards for life and health. There were positive proofs that organized labor had obtained a large share of power in the councils of the country.

Federal and State Relations.—If the interference of the government with business and labor represented a departure from the old idea of "the less government the better," what can be said of a large body of laws affecting the rights of states? The prohibition of child labor everywhere was one indication of the new tendency. Mr. Wilson had once declared such legislation unconstitutional; the Supreme Court declared it unconstitutional; but Congress, undaunted, carried it into effect under the guise of a tax on goods made by children below the age limit. There were other indications of the drift. Large sums of money were appropriated by Congress in 1916 to assist the states in building and maintaining highways. The same year the Farm Loan Act projected the federal government into the sphere of local money lending. In 1917 millions of dollars were granted to states in aid of vocational education, incidentally imposing uniform standards throughout the country. Evidently the government was no longer limited to the duties of the policeman.

The Prohibition Amendment.—A still more significant form of intervention in state affairs was the passage, in December, 1917, of an amendment to the federal Constitution establishing national prohibition of the manufacture and sale of intoxicating liquors as beverages. This was the climax of a historical movement extending over half a century. In 1872, a National Prohibition party, launched three years before, nominated its first presidential candidate and inaugurated a campaign of agitation. Though its vote was never large, the cause for which it stood found increasing favor among the people. State after state by popular referendum abolished the liquor traffic within its borders. By 1917 at least thirty-two of the forty-eight were "dry." When the federal amendment was submitted for approval, the ratification was surprisingly swift. In a little more than a year, namely, on January 16, 1919, it was proclaimed. Twelve months later the amendment went into effect.

COLONIAL AND FOREIGN POLICIES

The Philippines and Porto Rico.—Independence for the Philippines and larger self-government for Porto Rico had been among the policies of the Democratic party since the campaign of 1900. President Wilson in his annual messages urged upon Congress more autonomy for the Filipinos and a definite promise of final independence. The result was the Jones Organic Act for the Philippines passed in 1916. This measure provided that the upper as well as the lower house of the Philippine legislature should be elected by popular vote, and declared it to be the intention of the United States to grant independence "as soon as a stable government can be established." This, said President Wilson on signing the bill, is "a very satisfactory advance in our policy of extending to them self-government and control of their own affairs." The following year Congress, yielding to President Wilson's insistence, passed a new organic act for Porto Rico, making both houses of the legislature elective and conferring American citizenship upon the inhabitants of the island.



American Power in the Caribbean.—While extending more self-government to its dominions, the United States enlarged its sphere of influence in the Caribbean. The supervision of finances in Santo Domingo, inaugurated in Roosevelt's administration, was transformed into a protectorate under Wilson. In 1914 dissensions in the republic led to the landing of American marines to "supervise" the elections. Two years later, an officer in the American navy, with authority from Washington, placed the entire republic "in a state of military occupation." He proceeded to suspend the government and laws of the country, exile the president, suppress the congress, and substitute American military authority. In 1919 a consulting board of four prominent Dominicans was appointed to aid the American military governor; but it resigned the next year after making a plea for the restoration of independence to the republic. For all practical purposes, it seemed, the sovereignty of Santo Domingo had been transferred to the United States.

In the neighboring republic of Haiti, a similar state of affairs existed. In the summer of 1915 a revolution broke out there—one of a long series beginning in 1804—and our marines were landed to restore order. Elections were held under the supervision of American officers, and a treaty was drawn up placing the management of Haitian finances and the local constabulary under American authority. In taking this action, our Secretary of State was careful to announce: "The United States government has no purpose of aggression and is entirely disinterested in promoting this protectorate." Still it must be said that there were vigorous protests on the part of natives and American citizens against the conduct of our agents in the island. In 1921 President Wilson was considering withdrawal.

In line with American policy in the West Indian waters was the purchase in 1917 of the Danish Islands just off the coast of Porto Rico. The strategic position of the islands, especially in relation to Haiti and Porto Rico, made them an object of American concern as early as 1867, when a treaty of purchase was negotiated only to be rejected by the Senate of the United States. In 1902 a second arrangement was made, but this time it was defeated by the upper house of the Danish parliament. The third treaty brought an end to fifty years of bargaining and the Stars and Stripes were raised over St. Croix, St. Thomas, St. John, and numerous minor islands scattered about in the neighborhood. "It would be suicidal," commented a New York newspaper, "for America, on the threshold of a great commercial expansion in South America, to suffer a Heligoland, or a Gibraltar, or an Aden to be erected by her rivals at the mouth of her Suez." On the mainland American power was strengthened by the establishment of a protectorate over Nicaragua in 1916.

Mexican Relations.—The extension of American enterprise southward into Latin America, of which the operations in the Caribbean regions were merely one phase, naturally carried Americans into Mexico to develop the natural resources of that country. Under the iron rule of General Porfirio Diaz, established in 1876 and maintained with only a short break until 1911, Mexico had become increasingly attractive to our business men. On the invitation of President Diaz, they had invested huge sums in Mexican lands, oil fields, and mines, and had laid the foundations of a new industrial order. The severe regime instituted by Diaz, however, stirred popular discontent. The peons, or serfs, demanded the break-up of the great estates, some of which had come down from the days of Cortez. Their clamor for "the restoration of the land to the people could not be silenced." In 1911 Diaz was forced to resign and left the country.

Mexico now slid down the path to disorder. Revolutions and civil commotions followed in swift succession. A liberal president, Madero, installed as the successor to Diaz, was deposed in 1913 and brutally murdered. Huerta, a military adventurer, hailed for a time as another "strong man," succeeded Madero whose murder he was accused of instigating. Although Great Britain and nearly all the powers of Europe accepted the new government as lawful, the United States steadily withheld recognition. In the meantime Mexico was torn by insurrections under the leadership of Carranza, a friend of Madero, Villa, a bandit of generous pretensions, and Zapata, a radical leader of the peons. Without the support of the United States, Huerta was doomed.

In the summer of 1914, the dictator resigned and fled from the capital, leaving the field to Carranza. For six years the new president, recognized by the United States, held a precarious position which he vigorously strove to strengthen against various revolutionary movements. At length in 1920, he too was deposed and murdered, and another military chieftain, Obregon, installed in power.

These events right at our door could not fail to involve the government of the United States. In the disorders many American citizens lost their lives. American property was destroyed and land owned by Americans was confiscated. A new Mexican constitution, in effect nationalizing the natural resources of the country, struck at the rights of foreign investors. Moreover the Mexican border was in constant turmoil. Even in the last days of his administration, Mr. Taft felt compelled to issue a solemn warning to the Mexican government protesting against the violation of American rights.

President Wilson, soon after his inauguration, sent a commissioner to Mexico to inquire into the situation. Although he declared a general policy of "watchful waiting," he twice came to blows with Mexican forces. In 1914 some American sailors at Tampico were arrested by a Mexican officer; the Mexican government, although it immediately released the men, refused to make the required apology for the incident. As a result President Wilson ordered the landing of American forces at Vera Cruz and the occupation of the city. A clash of arms followed in which several Americans were killed. War seemed inevitable, but at this juncture the governments of Argentina, Brazil, and Chile tendered their good offices as mediators. After a few weeks of negotiation, during which Huerta was forced out of power, American forces were withdrawn from Vera Cruz and the incident closed.

In 1916 a second break in amicable relations occurred. In the spring of that year a band of Villa's men raided the town of Columbus, New Mexico, killing several citizens and committing robberies. A punitive expedition under the command of General Pershing was quickly sent out to capture the offenders. Against the protests of President Carranza, American forces penetrated deeply into Mexico without effecting the object of the undertaking. This operation lasted until January, 1917, when the imminence of war with Germany led to the withdrawal of the American soldiers. Friendly relations were resumed with the Mexican government and the policy of "watchful waiting" was continued.

THE UNITED STATES AND THE EUROPEAN WAR

The Outbreak of the War.—In the opening days of August, 1914, the age-long jealousies of European nations, sharpened by new imperial ambitions, broke out in another general conflict such as had shaken the world in the days of Napoleon. On June 28, the heir to the Austro-Hungarian throne was assassinated at Serajevo, the capital of Bosnia, an Austrian province occupied mainly by Serbs. With a view to stopping Serbian agitation for independence, Austria-Hungary laid the blame for this incident on the government of Serbia and made humiliating demands on that country. Germany at once proposed that the issue should be regarded as "an affair which should be settled solely between Austria-Hungary and Serbia"; meaning that the small nation should be left to the tender mercies of a great power. Russia refused to take this view. Great Britain proposed a settlement by mediation. Germany backed up Austria to the limit. To use the language of the German authorities: "We were perfectly aware that a possible warlike attitude of Austria-Hungary against Serbia might bring Russia upon the field and that it might therefore involve us in a war, in accordance with our duties as allies. We could not, however, in these vital interests of Austria-Hungary which were at stake, advise our ally to take a yielding attitude not compatible with his dignity nor deny him our assistance." That made the war inevitable.

Every day of the fateful August, 1914, was crowded with momentous events. On the 1st, Germany declared war on Russia. On the 2d, the Germans invaded the little duchy of Luxemburg and notified the King of Belgium that they were preparing to violate the neutrality of his realm on their way to Paris. On the same day, Great Britain, anxiously besought by the French government, promised the aid of the British navy if German warships made hostile demonstrations in the Channel. August 3d, the German government declared war on France. The following day, Great Britain demanded of Germany respect for Belgian neutrality and, failing to receive the guarantee, broke off diplomatic relations. On the 5th, the British prime minister announced that war had opened between England and Germany. The storm now broke in all its pitiless fury.

The State of American Opinion.—Although President Wilson promptly proclaimed the neutrality of the United States, the sympathies of a large majority of the American people were without doubt on the side of Great Britain and France. To them the invasion of the little kingdom of Belgium and the horrors that accompanied German occupation were odious in the extreme. Moreover, they regarded the German imperial government as an autocratic power wielded in the interest of an ambitious military party. The Kaiser, William II, and the Crown Prince were the symbols of royal arrogance. On the other hand, many Americans of German descent, in memory of their ties with the Fatherland, openly sympathized with the Central Powers; and many Americans of Irish descent, recalling their long and bitter struggle for home rule in Ireland, would have regarded British defeat as a merited redress of ancient grievances.

Extremely sensitive to American opinion, but ill informed about it, the German government soon began systematic efforts to present its cause to the people of the United States in the most favorable light possible. Dr. Bernhard Dernburg, the former colonial secretary of the German empire, was sent to America as a special agent. For months he filled the newspapers, magazines, and periodicals with interviews, articles, and notes on the justice of the Teutonic cause. From a press bureau in New York flowed a stream of pamphlets, leaflets, and cartoons. A magazine, "The Fatherland," was founded to secure "fair play for Germany and Austria." Several professors in American universities, who had received their training in Germany, took up the pen in defense of the Central Empires. The German language press, without exception it seems, the National German Alliance, minor German societies, and Lutheran churches came to the support of the German cause. Even the English language papers, though generally favorable to the Entente Allies, opened their columns in the interest of equal justice to the spokesmen for all the contending powers of Europe.

Before two weeks had elapsed the controversy had become so intense that President Wilson (August 18, 1914) was moved to caution his countrymen against falling into angry disputes. "Every man," he said, "who really loves America will act and speak in the true spirit of neutrality which is the spirit of impartiality and fairness and friendliness to all concerned.... We must be impartial in thought as well as in action, must put a curb upon our sentiments as well as upon every transaction that might be construed as a preference of one party to the struggle before another."

The Clash over American Trade.—As in the time of the Napoleonic wars, the conflict in Europe raised fundamental questions respecting rights of Americans trading with countries at peace as well as those at war. On this point there existed on August 1, 1914, a fairly definite body of principles by which nations were bound. Among them the following were of vital significance. In the first place, it was recognized that an enemy merchant ship caught on the high seas was a legitimate prize of war which might be seized and confiscated. In the second place, it was agreed that "contraband of war" found on an enemy or neutral ship was a lawful prize; any ship suspected of carrying it was liable to search and if caught with forbidden goods was subject to seizure. In the third place, international law prescribed that a peaceful merchant ship, whether belonging to an enemy or to a neutral country, should not be destroyed or sunk without provision for the safety of crew and passengers. In the fourth place, it was understood that a belligerent had the right, if it could, to blockade the ports of an enemy and prevent the ingress and egress of all ships; but such a blockade, to be lawful, had to be effective.

These general principles left undetermined two important matters: "What is an effective blockade?" and "What is contraband of war?" The task of answering these questions fell to Great Britain as mistress of the seas. Although the German submarines made it impossible for her battleships to maintain a continuous patrol of the waters in front of blockaded ports, she declared the blockade to be none the less "effective" because her navy was supreme. As to contraband of war Great Britain put such a broad interpretation upon the term as to include nearly every important article of commerce. Early in 1915 she declared even cargoes of grain and flour to be contraband, defending the action on the ground that the German government had recently taken possession of all domestic stocks of corn, wheat, and flour.

A new question arose in connection with American trade with the neutral countries surrounding Germany. Great Britain early began to intercept ships carrying oil, gasoline, and copper—all war materials of prime importance—on the ground that they either were destined ultimately to Germany or would release goods for sale to Germans. On November 2, 1914, the English government announced that the Germans wore sowing mines in open waters and that therefore the whole of the North Sea was a military zone. Ships bound for Denmark, Norway, and Sweden were ordered to come by the English Channel for inspection and sailing directions. In effect, Americans were now licensed by Great Britain to trade in certain commodities and in certain amounts with neutral countries.

Against these extraordinary measures, the State Department at Washington lodged pointed objections, saying: "This government is reluctantly forced to the conclusion that the present policy of His Majesty's government toward neutral ships and cargoes exceeds the manifest necessity of a belligerent and constitutes restrictions upon the rights of American citizens on the high seas, which are not justified by the rules of international law or required under the principle of self-preservation."

Germany Begins the Submarine Campaign.—Germany now announced that, on and after February 18, 1915, the whole of the English Channel and the waters around Great Britain would be deemed a war zone and that every enemy ship found therein would be destroyed. The German decree added that, as the British admiralty had ordered the use of neutral flags by English ships in time of distress, neutral vessels would be in danger of destruction if found in the forbidden area. It was clear that Germany intended to employ submarines to destroy shipping. A new factor was thus introduced into naval warfare, one not provided for in the accepted laws of war. A warship overhauling a merchant vessel could easily take its crew and passengers on board for safe keeping as prescribed by international law; but a submarine ordinarily could do nothing of the sort. Of necessity the lives and the ships of neutrals, as well as of belligerents, were put in mortal peril. This amazing conduct Germany justified on the ground that it was mere retaliation against Great Britain for her violations of international law.

The response of the United States to the ominous German order was swift and direct. On February 10, 1915, it warned Germany that if her commanders destroyed American lives and ships in obedience to that decree, the action would "be very hard indeed to reconcile with the friendly relations happily subsisting between the two governments." The American note added that the German imperial government would be held to "strict accountability" and all necessary steps would be taken to safeguard American lives and American rights. This was firm and clear language, but the only response which it evoked from Germany was a suggestion that, if Great Britain would allow food supplies to pass through the blockade, the submarine campaign would be dropped.

Violations of American Rights.—Meanwhile Germany continued to ravage shipping on the high seas. On January 28, a German raider sank the American ship, William P. Frye, in the South Atlantic; on March 28, a British ship, the Falaba, was sunk by a submarine and many on board, including an American citizen, were killed; and on April 28, a German airplane dropped bombs on the American steamer Cushing. On the morning of May 1, 1915, Americans were astounded to see in the newspapers an advertisement, signed by the German Imperial Embassy, warning travelers of the dangers in the war zone and notifying them that any who ventured on British ships into that area did so at their own risk. On that day, the Lusitania, a British steamer, sailed from New York for Liverpool. On May 7, without warning, the ship was struck by two torpedoes and in a few minutes went down by the bow, carrying to death 1153 persons including 114 American men, women, and children. A cry of horror ran through the country. The German papers in America and a few American people argued that American citizens had been duly warned of the danger and had deliberately taken their lives into their own hands; but the terrible deed was almost universally condemned by public opinion.

The Lusitania Notes.—On May 14, the Department of State at Washington made public the first of three famous notes on the Lusitania case. It solemnly informed the German government that "no warning that an unlawful and inhumane act will be committed can possibly be accepted as an excuse or palliation for that act or as an abatement of the responsibility for its commission." It called upon the German government to disavow the act, make reparation as far as possible, and take steps to prevent "the recurrence of anything so obviously subversive of the principles of warfare." The note closed with a clear caution to Germany that the government of the United States would not "omit any word or any act necessary to the performance of its sacred duty of maintaining the rights of the United States and its citizens and of safeguarding their free exercise and enjoyment." The die was cast; but Germany in reply merely temporized.

In a second note, made public on June 11, the position of the United States was again affirmed. William Jennings Bryan, the Secretary of State, had resigned because the drift of President Wilson's policy was not toward mediation but the strict maintenance of American rights, if need be, by force of arms. The German reply was still evasive and German naval commanders continued their course of sinking merchant ships. In a third and final note of July 21, 1915, President Wilson made it clear to Germany that he meant what he said when he wrote that he would maintain the rights of American citizens. Finally after much discussion and shifting about, the German ambassador on September 1, 1915, sent a brief note to the Secretary of State: "Liners will not be sunk by our submarines without warning and without safety of the lives of non-combatants, provided the liners do not try to escape or offer resistance." Editorially, the New York Times declared: "It is a triumph not only of diplomacy but of reason, of humanity, of justice, and of truth." The Secretary of State saw in it "a recognition of the fundamental principles for which we have contended."

The Presidential Election of 1916.—In the midst of this crisis came the presidential campaign. On the Republican side everything seemed to depend upon the action of the Progressives. If the breach created in 1912 could be closed, victory was possible; if not, defeat was certain. A promise of unity lay in the fact that the conventions of the Republicans and Progressives were held simultaneously in Chicago. The friends of Roosevelt hoped that both parties would select him as their candidate; but this hope was not realized. The Republicans chose, and the Progressives accepted, Charles E. Hughes, an associate justice of the federal Supreme Court who, as governor of New York, had won a national reputation by waging war on "machine politicians."

In the face of the clamor for expressions of sympathy with one or the other of the contending powers of Europe, the Republicans chose a middle course, declaring that they would uphold all American rights "at home and abroad, by land and by sea." This sentiment Mr. Hughes echoed in his acceptance speech. By some it was interpreted to mean a firmer policy in dealing with Great Britain; by others, a more vigorous handling of the submarine menace. The Democrats, on their side, renominated President Wilson by acclamation, reviewed with pride the legislative achievements of the party, and commended "the splendid diplomatic victories of our great President who has preserved the vital interests of our government and its citizens and kept us out of war."

In the election which ensued President Wilson's popular vote exceeded that cast for Mr. Hughes by more than half a million, while his electoral vote stood 277 to 254. The result was regarded, and not without warrant, as a great personal triumph for the President. He had received the largest vote yet cast for a presidential candidate. The Progressive party practically disappeared, and the Socialists suffered a severe set-back, falling far behind the vote of 1912.

President Wilson Urges Peace upon the Warring Nations.—Apparently convinced that his pacific policies had been profoundly approved by his countrymen, President Wilson, soon after the election, addressed "peace notes" to the European belligerents. On December 16, the German Emperor proposed to the Allied Powers that they enter into peace negotiations, a suggestion that was treated as a mere political maneuver by the opposing governments. Two days later President Wilson sent a note to the warring nations asking them to avow "the terms upon which war might be concluded." To these notes the Central Powers replied that they were ready to meet their antagonists in a peace conference; and Allied Powers answered by presenting certain conditions precedent to a satisfactory settlement. On January 22, 1917, President Wilson in an address before the Senate, declared it to be a duty of the United States to take part in the establishment of a stable peace on the basis of certain principles. These were, in short: "peace without victory"; the right of nationalities to freedom and self-government; the independence of Poland; freedom of the seas; the reduction of armaments; and the abolition of entangling alliances. The whole world was discussing the President's remarkable message, when it was dumbfounded to hear, on January 31, that the German ambassador at Washington had announced the official renewal of ruthless submarine warfare.

THE UNITED STATES AT WAR

Steps toward War.—Three days after the receipt of the news that the German government intended to return to its former submarine policy, President Wilson severed diplomatic relations with the German empire. At the same time he explained to Congress that he desired no conflict with Germany and would await an "overt act" before taking further steps to preserve American rights. "God grant," he concluded, "that we may not be challenged to defend them by acts of willful injustice on the part of the government of Germany." Yet the challenge came. Between February 26 and April 2, six American merchant vessels were torpedoed, in most cases without any warning and without regard to the loss of American lives. President Wilson therefore called upon Congress to answer the German menace. The reply of Congress on April 6 was a resolution, passed with only a few dissenting votes, declaring the existence of a state of war with Germany. Austria-Hungary at once severed diplomatic relations with the United States; but it was not until December 7 that Congress, acting on the President's advice, declared war also on that "vassal of the German government."

American War Aims.—In many addresses at the beginning and during the course of the war, President Wilson stated the purposes which actuated our government in taking up arms. He first made it clear that it was a war of self-defense. "The military masters of Germany," he exclaimed, "denied us the right to be neutral." Proof of that lay on every hand. Agents of the German imperial government had destroyed American lives and American property on the high seas. They had filled our communities with spies. They had planted bombs in ships and munition works. They had fomented divisions among American citizens.

Though assailed in many ways and compelled to resort to war, the United States sought no material rewards. "The world must be made safe for democracy. Its peace must be planted upon the tested foundations of political liberty. We have no selfish ends to serve. We desire no conquest, no dominion. We seek no indemnities for ourselves."

In a very remarkable message read to Congress on January 8, 1918, President Wilson laid down his famous "fourteen points" summarizing the ideals for which we were fighting. They included open treaties of peace, openly arrived at; absolute freedom of navigation upon the seas; the removal, as far as possible, of trade barriers among nations; reduction of armaments; adjustment of colonial claims in the interest of the populations concerned; fair and friendly treatment of Russia; the restoration of Belgium; righting the wrong done to France in 1871 in the matter of Alsace-Lorraine; adjustment of Italian frontiers along the lines of nationality; more liberty for the peoples of Austria-Hungary; the restoration of Serbia and Rumania; the readjustment of the Turkish Empire; an independent Poland; and an association of nations to afford mutual guarantees to all states great and small. On a later occasion President Wilson elaborated the last point, namely, the formation of a league of nations to guarantee peace and establish justice among the powers of the world. Democracy, the right of nations to determine their own fate, a covenant of enduring peace—these were the ideals for which the American people were to pour out their blood and treasure.

The Selective Draft.—The World War became a war of nations. The powers against which we were arrayed had every able-bodied man in service and all their resources, human and material, thrown into the scale. For this reason, President Wilson summoned the whole people of the United States to make every sacrifice necessary for victory. Congress by law decreed that the national army should be chosen from all male citizens and males not enemy aliens who had declared their intention of becoming citizens. By the first act of May 18, 1917, it fixed the age limits at twenty-one to thirty-one inclusive. Later, in August, 1918, it extended them to eighteen and forty-five. From the men of the first group so enrolled were chosen by lot the soldiers for the World War who, with the regular army and the national guard, formed the American Expeditionary Force upholding the American cause on the battlefields of Europe. "The whole nation," said the President, "must be a team in which each man shall play the part for which he is best fitted."

Liberty Loans and Taxes.—In order that the military and naval forces should be stinted in no respect, the nation was called upon to place its financial resources at the service of the government. Some urged the "conscription of wealth as well as men," meaning the support of the war out of taxes upon great fortunes; but more conservative counsels prevailed. Four great Liberty Loans were floated, all the agencies of modern publicity being employed to enlist popular interest. The first loan had four and a half million subscribers; the fourth more than twenty million. Combined with loans were heavy taxes. A progressive tax was laid upon incomes beginning with four per cent on incomes in the lower ranges and rising to sixty-three per cent of that part of any income above $2,000,000. A progressive tax was levied upon inheritances. An excess profits tax was laid upon all corporations and partnerships, rising in amount to sixty per cent of the net income in excess of thirty-three per cent on the invested capital. "This," said a distinguished economist, "is the high-water mark in the history of taxation. Never before in the annals of civilization has an attempt been made to take as much as two-thirds of a man's income by taxation."

Mobilizing Material Resources.—No stone was left unturned to provide the arms, munitions, supplies, and transportation required in the gigantic undertaking. Between the declaration of war and the armistice, Congress enacted law after law relative to food supplies, raw materials, railways, mines, ships, forests, and industrial enterprises. No power over the lives and property of citizens, deemed necessary to the prosecution of the armed conflict, was withheld from the government. The farmer's wheat, the housewife's sugar, coal at the mines, labor in the factories, ships at the wharves, trade with friendly countries, the railways, banks, stores, private fortunes—all were mobilized and laid under whatever obligations the government deemed imperative. Never was a nation more completely devoted to a single cause.

A law of August 10, 1917, gave the President power to fix the prices of wheat and coal and to take almost any steps necessary to prevent monopoly and excessive prices. By a series of measures, enlarging the principles of the shipping act of 1916, ships and shipyards were brought under public control and the government was empowered to embark upon a great ship-building program. In December, 1917, the government assumed for the period of the war the operation of the railways under a presidential proclamation which was elaborated in March, 1918, by act of Congress. In the summer of 1918 the express, telephone, and telegraph business of the entire country passed under government control. By war risk insurance acts allowances were made for the families of enlisted men, compensation for injuries was provided, death benefits were instituted, and a system of national insurance was established in the interest of the men in service. Never before in the history of the country had the government taken such a wise and humane view of its obligations to those who served on the field of battle or on the seas.

The Espionage and Sedition Acts.—By the Espionage law of June 15, 1917, and the amending law, known as the Sedition act, passed in May of the following year, the government was given a drastic power over the expression of opinion. The first measure penalized those who conveyed information to a foreign country to be used to the injury of the United States; those who made false statements designed to interfere with the military or naval forces of the United States; those who attempted to stir up insubordination or disloyalty in the army and navy; and those who willfully obstructed enlistment. The Sedition act was still more severe and sweeping in its terms. It imposed heavy penalties upon any person who used "abusive language about the government or institutions of the country." It authorized the dismissal of any officer of the government who committed "disloyal acts" or uttered "disloyal language," and empowered the Postmaster General to close the mails to persons violating the law. This measure, prepared by the Department of Justice, encountered vigorous opposition in the Senate, where twenty-four Republicans and two Democrats voted against it. Senator Johnson of California denounced it as a law "to suppress the freedom of the press in the United States and to prevent any man, no matter who he is, from expressing legitimate criticism concerning the present government." The constitutionality of the acts was attacked; but they were sustained by the Supreme Court and stringently enforced.



Labor and the War.—In view of the restlessness of European labor during the war and especially the proletarian revolution in Russia in November, 1917, some anxiety was early expressed as to the stand which organized labor might take in the United States. It was, however, soon dispelled. Samuel Gompers, speaking for the American Federation of Labor, declared that "this is labor's war," and pledged the united support of all the unions. There was some dissent. The Socialist party denounced the war as a capitalist quarrel; but all the protests combined were too slight to have much effect. American labor leaders were sent to Europe to strengthen the wavering ranks of trade unionists in war-worn England, France, and Italy. Labor was given representation on the important boards and commissions dealing with industrial questions. Trade union standards were accepted by the government and generally applied in industry. The Department of Labor became one of the powerful war centers of the nation. In a memorable address to the American Federation of Labor, President Wilson assured the trade unionists that labor conditions should not be made unduly onerous by the war and received in return a pledge of loyalty from the Federation. Recognition of labor's contribution to winning the war was embodied in the treaty of peace, which provided for a permanent international organization to promote the world-wide effort of labor to improve social conditions. "The league of nations has for its object the establishment of universal peace," runs the preamble to the labor section of the treaty, "and such a peace can be established only if it is based upon social justice.... The failure of any nation to adopt humane conditions of labor is an obstacle in the way of other nations which desire to improve the conditions in their own countries."

The American Navy in the War.—As soon as Congress declared war the fleet was mobilized, American ports were thrown open to the warships of the Allies, immediate provision was made for increasing the number of men and ships, and a contingent of war vessels was sent to cooeperate with the British and French in their life-and-death contest with submarines. Special effort was made to stimulate the production of "submarine chasers" and "scout cruisers" to be sent to the danger zone. Convoys were provided to accompany the transports conveying soldiers to France. Before the end of the war more than three hundred American vessels and 75,000 officers and men were operating in European waters. Though the German fleet failed to come out and challenge the sea power of the Allies, the battleships of the United States were always ready to do their full duty in such an event. As things turned out, the service of the American navy was limited mainly to helping in the campaign that wore down the submarine menace to Allied shipping.

The War in France.—Owing to the peculiar character of the warfare in France, it required a longer time for American military forces to get into action; but there was no unnecessary delay. Soon after the declaration of war, steps were taken to give military assistance to the Allies. The regular army was enlarged and the troops of the national guard were brought into national service. On June 13, General John J. Pershing, chosen head of the American Expeditionary Forces, reached Paris and began preparations for the arrival of our troops. In June, the vanguard of the army reached France. A slow and steady stream followed. As soon as the men enrolled under the draft were ready, it became a flood. During the period of the war the army was enlarged from about 190,000 men to 3,665,000, of whom more than 2,000,000 were in France when the armistice was signed.

Although American troops did not take part on a large scale until the last phase of the war in 1918, several battalions of infantry were in the trenches by October, 1917, and had their first severe encounter with the Germans early in November. In January, 1918, they took over a part of the front line as an American sector. In March, General Pershing placed our forces at the disposal of General Foch, commander-in-chief of the Allied armies. The first division, which entered the Montdidier salient in April, soon was engaged with the enemy, "taking with splendid dash the town of Cantigny and all other objectives, which were organized and held steadfastly against vicious counter attacks and galling artillery fire."



When the Germans launched their grand drives toward the Marne and Paris, in June and July, 1918, every available man was placed at General Foch's command. At Belleau Wood, at Chateau-Thierry, and other points along the deep salient made by the Germans into the French lines, American soldiers distinguished themselves by heroic action. They also played an important role in the counter attack that "smashed" the salient and drove the Germans back.

In September, American troops, with French aid, "wiped out" the German salient at St. Mihiel. By this time General Pershing was ready for the great American drive to the northeast in the Argonne forest, while he also cooeperated with the British in the assault on the Hindenburg line. In the Meuse-Argonne battle, our soldiers encountered some of the most severe fighting of the war and pressed forward steadily against the most stubborn resistance from the enemy. On the 6th of November, reported General Pershing, "a division of the first corps reached a point on the Meuse opposite Sedan, twenty-five miles from our line of departure. The strategical goal which was our highest hope was gained. We had cut the enemy's main line of communications and nothing but a surrender or an armistice could save his army from complete disaster." Five days later the end came. On the morning of November 11, the order to cease firing went into effect. The German army was in rapid retreat and demoralization had begun. The Kaiser had abdicated and fled into Holland. The Hohenzollern dreams of empire were shattered. In the fifty-second month, the World War, involving nearly every civilized nation on the globe, was brought to a close. More than 75,000 American soldiers and sailors had given their lives. More than 250,000 had been wounded or were missing or in German prison camps.



THE SETTLEMENT AT PARIS

The Peace Conference.—On January 18, 1919, a conference of the Allied and Associated Powers assembled to pronounce judgment upon the German empire and its defeated satellites: Austria-Hungary, Bulgaria, and Turkey. It was a moving spectacle. Seventy-two delegates spoke for thirty-two states. The United States, Great Britain, France, Italy, and Japan had five delegates each. Belgium, Brazil, and Serbia were each assigned three. Canada, Australia, South Africa, India, China, Greece, Hedjaz, Poland, Portugal, Rumania, Siam, and Czechoslovakia were allotted two apiece. The remaining states of New Zealand, Bolivia, Cuba, Ecuador, Guatemala, Haiti, Honduras, Liberia, Nicaragua, Panama, Peru, and Uruguay each had one delegate. President Wilson spoke in person for the United States. England, France, and Italy were represented by their premiers: David Lloyd George, Georges Clemenceau, and Vittorio Orlando.



The Supreme Council.—The real work of the settlement was first committed to a Supreme Council of ten representing the United States, Great Britain, France, Italy, and Japan. This was later reduced to five members. Then Japan dropped out and finally Italy, leaving only President Wilson and the Premiers, Lloyd George and Clemenceau, the "Big Three," who assumed the burden of mighty decisions. On May 6, their work was completed and in a secret session of the full conference the whole treaty of peace was approved, though a few of the powers made reservations or objections. The next day the treaty was presented to the Germans who, after prolonged protests, signed on the last day of grace, June 28. This German treaty was followed by agreements with Austria, Hungary, Bulgaria, and Turkey. Collectively these great documents formed the legal basis of the general European settlement.

The Terms of the Settlement.—The combined treaties make a huge volume. The German treaty alone embraces about 80,000 words. Collectively they cover an immense range of subjects which may be summarized under five heads: (1) The territorial settlement in Europe; (2) the destruction of German military power; (3) reparations for damages done by Germany and her allies; (4) the disposition of German colonies and protectorates; and (5) the League of Nations.

Germany was reduced by the cession of Alsace-Lorraine to France and the loss of several other provinces. Austria-Hungary was dissolved and dismembered. Russia was reduced by the creation of new states on the west. Bulgaria was stripped of her gains in the recent Balkan wars. Turkey was dismembered. Nine new independent states were created: Poland, Finland, Lithuania, Latvia, Esthonia, Ukraine, Czechoslovakia, Armenia, and Hedjaz. Italy, Greece, Rumania, and Serbia were enlarged by cessions of territory and Serbia was transformed into the great state of Jugoslavia.

The destruction of German military power was thorough. The entire navy, with minor exceptions, was turned over to the Allied and Associated Powers; Germany's total equipment for the future was limited to six battleships and six light cruisers, with certain small vessels but no submarines. The number of enlisted men and officers for the army was fixed at not more than 100,000; the General Staff was dissolved; and the manufacture of munitions restricted.

Germany was compelled to accept full responsibility for all damages; to pay five billion dollars in cash and goods, and to make certain other payments which might be ordered from time to time by an inter-allied reparations commission. She was also required to deliver to Belgium, France, and Italy, millions of tons of coal every year for ten years; while by way of additional compensation to France the rich coal basin of the Saar was placed under inter-allied control to be exploited under French administration for a period of at least fifteen years. Austria and the other associates of Germany were also laid under heavy obligations to the victors. Damages done to shipping by submarines and other vessels were to be paid for on the basis of ton for ton.

The disposition of the German colonies and the old Ottoman empire presented knotty problems. It was finally agreed that the German colonies and Turkish provinces which were in a backward stage of development should be placed under the tutelage of certain powers acting as "mandatories" holding them in "a sacred trust of civilization." An exception to the mandatory principle arose in the case of German rights in Shantung, all of which were transferred directly to Japan. It was this arrangement that led the Chinese delegation to withhold their signatures from the treaty.