By this time a definite form of government could be planned for, built upon the labors of the second Commission. The Philippine Act of July 1, 1902, provided for a governor appointed by the President, with the advice of the Senate, executive departments, and a legislature, the lower house of which was elected by the people. From the beginning the Filipinos, like the Porto Ricans, have desired a greater range of self-government, and in 1916 long steps were taken in the direction desired by them. The Jones act of that year materially increased the powers of the Philippine government and gave the Filipinos power to elect the upper as well as the lower house of the legislature. The passage of the law met with enthusiastic approval in the islands.

The purpose of American rule in the Philippines has been to fit the people for self-government, although opinions have differed as to how soon the final outcome could be brought about. An early and bothersome problem was found in the friars' lands, which consisted of about 425,000 acres, for the most part in the vicinity of Manila. The possession of so great an area, together with the religious power and the considerable political authority which the friars exercised under Spanish rule, gave the Church a domination which might threaten trouble after the American occupation. The solution of the problem was found in the purchase of the lands for about $7,000,000 by the United States. Efforts have been made to introduce a complete system of education—physical and industrial, as well as academic—with such success that when the Jones bill was being discussed in Congress in 1916 it was asserted that every member of the Philippine legislature at that time was a college graduate. In 1917 the Filipino student body numbered 647,256, with 11,822 teachers. Political education has also been a part of the American idea. Elementary self-government was gradually introduced, starting in the more civilized local municipalities and provinces and confining the suffrage to the educated people, the official classes and property owners. The preservation of order has been more and more entrusted to a Philippine constabulary; civil service officers and school teachers have been increasingly chosen from the Filipinos; and the courts have been partly manned with native judges. Work in sanitation has followed the lines marked out in Cuba and Porto Rico. First and last over 10,000,000 vaccinations were performed before 1914; small-pox has been controlled; attention has been paid to the building of highways and railroads, water supply, the disposal of sewage and allied problems. The precise time, if ever, when independence should be granted to the Philippines is the one great question remaining.

The first attempt to revise the customs laws in the Philippines was made by the Commission during the governorship of William H. Taft. These schedules were revised in Washington in such a way as to discriminate against Philippine interests, but they had remained in force only a short time when Congress passed the act of March 8, 1902, allowing goods grown or produced in the Philippines to enter the United States under a twenty-five per cent. reduction. In 1909, the tariff makers were induced to relent to the extent of allowing the free importation of goods grown, produced or manufactured in the Philippines, except that only a specified annual amount of Philippine sugar and tobacco might be brought in. In 1913 the wall was entirely removed on all trade between the United States and the Philippines in articles made or grown in either of the two countries.

While Congress and the President were concerning themselves with the practical problems of military control, sanitation and the like, the Supreme Court was laboriously considering the less tangible but equally perplexing question of the constitutionality of the several acts which the legislative and executive departments had committed. The power of Congress to acquire territory and the right of the executive to control new territory under the war power had long been conceded. Admittedly, however, government under the war power was temporary and transitional. In earlier times such acquisitions as those effected by the Louisiana purchase and the annexation of Texas had been consummated with the distinct understanding that these regions should immediately or eventually become territories or states in the Union. The status of Porto Rico and the Philippines was novel. "The civil rights and political status of the native inhabitants of the territories hereby ceded to the United States," ran the words of the treaty of peace closing the war with Spain, "shall be determined by the Congress." Did this mean that Congress might govern the new acquisitions independently of the Constitution? Could it abridge freedom of speech, and permit cruel and unusual punishments, or establish slavery? Could Congress permanently govern these lands without giving their citizens the rights of citizens of the United States, and with no intention of ever making them territories or states? On the other hand, if Congress must act within the limits prescribed by the Constitution, would the wild Moros of the Philippines be the beneficiaries of the amendment preserving the right of trial by jury? In the popular language of the day, did the Constitution follow the flag?

It was not long before the Supreme Court was called upon in the "Insular Cases" to express itself upon these constitutional questions. The first case was De Lima v. Bidwell. It was a suit to recover duties paid on goods sent from Porto Rico to the United States during the interval between the cession of the island and the passage of the Foraker Act. The duties had been paid under the Dingley law, which levied customs of specified amounts upon all goods imported "from foreign countries." Was Porto Rico a "foreign" country? The majority of the nine members of the Court thought that it was not foreign, that there was scarcely a "shred of authority" for the view that a "district ceded to and in the possession of the United States remains for any purpose a foreign country." Since Porto Rico was not a foreign country, the duties were wrongfully collected and must be returned. The remaining four justices dissented. One of them delivered a dissenting opinion in which he held that Porto Rico occupied middle ground between that of a foreign country and domestic territory. As such its status could be determined by Congress only and therefore its products were subject to duties levied by the Dingley act.

In Downes v. Bidwell the Court was compelled to determine the constitutionality of the part of the Foraker Act which provided for a tariff between Porto Rico and the United States equal to fifteen per cent. of that levied by the Dingley act. Again the Court divided five to four. Mr. Justice Brown delivered the majority opinion. It was to the effect that the Constitution applied only to States; that Congress possessed unlimited power over the political relations of the territories; that Porto Rico was a "territory appurtenant to and belonging to the United States"; and that the part of the Constitution which says that duties shall be uniform throughout the United States did not apply to Porto Rico unless Congress so willed. Hence the customs clause of the Foraker Act was valid. Four of the majority, however, who agreed with Mr. Justice Brown in his conclusion that the tariff clause of the Foraker Act was constitutional did so for reasons which they asserted to be "different from, if not in conflict with, those expressed" by him.

From the point of view of constitutional law, the decisions were unsatisfactory, because of the balanced division of opinion. Yet to have declared all the provisions of the Constitution in force in all the acquisitions would have been embarrassing. Logic and the Constitution went to the winds, while the executive and legislative departments administered the territories on the convenient and flexible theory that certain constitutional provisions must be heeded and that others need not.

While the colonial policy of the United States was being developed, the possession of the Philippines added interest in the United States to an unusual international situation in China which immediately involved several European nations and eventually affected America. The Chinese-Japanese War, which came to a close in 1895, had uncovered to the world the weakness of China as a military power and had weakened the hold of the reigning monarch upon the people of the Empire. Thereupon the leading commercial nations of Europe began to seize portions of China in order to extend their trade relations in the Far East. Russia first attempted to obtain a seaport, but retired when an uproar of protest arose from the remainder of Europe. Not long afterwards, two German missionaries in the province of Shantung were murdered. The outrage formed a sufficient pretext for aggressive action, as a result of which China leased Kiaochau to Germany for ninety-nine years, including in the grant railway and mining privileges and an indemnity; Russia then renewed her attempt and succeeded in leasing Port Arthur and Talienwan for twenty-five years. Great Britain followed with the acquisition of rights in Weihaiwei similar to those of Russia in Port Arthur; Japan found its share in the province of Fukien, and France in Kwangchaouwan. In each case, moreover, the leasing power designated a large area around its holdings as a "sphere of influence," in which its economic and political mastery was complete. In this way, thirteen of the eighteen provinces of China, including the most desirable harbors, waterways and mines, were partially controlled by the powers.

American foreign affairs had been, since October 1, 1898, in the skilful hands of John Hay, who was possessed of an intimate knowledge of conditions in Europe. Hay perceived the danger to American commercial interests in China, and accordingly in September, 1899, he addressed a circular note to the powers requesting each of them to give formal assurances that in its sphere of influence: (1) it would not interfere with any treaty port or vested interest; (2) it would agree that the Chinese tariff should apply equally to all goods shipped to ports in the spheres, and be collected by the Chinese officials; and (3) it would charge no higher harbor and railroad rates for citizens of other nations than for its own. The powers having agreed more or less directly, Hay informed them by a note of March 20, 1900, that all had acceded to his propositions and that the United States considered their assent as "final and definitive." There could be, of course, no effectual guaranty that the powers would fully observe this "Open-Door" policy, but the economic penetration of China, which would soon result in complete political possession, was at least retarded for the moment.

Domestic affairs in China, meanwhile, had been seething under the surface. An ill-starred reform movement, initiated by the Emperor, had failed, the government was discredited, and the Empress Dowager seized the throne for herself. All China interpreted the event to presage a return to the old order of things—a general anti-foreign movement. Economic distresses, bad crops, a disastrous flood and hatred of foreign missionaries, combined with a deep resentment at the European partition of their country, caused the Chinese to break out in a score of scattered attacks on the hated aliens. The culmination was the Boxer Rebellion. The Boxers was a society which had long existed in China for various religious, patriotic and other purposes. It took up the cry "Drive out the foreigners and uphold the dynasty." Government officials by their disinclination to quell the Boxer uprising, showed that their sympathies were with the rioters.

The climax of the outbreak came in and around Pekin, the capital of China. The railroad from the city to the coast was seized, telegraphic connection cut off, and the representatives of the foreign powers were compelled to fortify themselves within the city. On June 19, 1900, all foreigners were ordered to leave within twenty-four hours, and the German minister was shot when he attempted to visit the proper officer in order to protest. The Chinese army poured out to surround the quarter of the city where the legations were situated and cut them off from the rest of the world. All foreigners fled to the British legation, where they constructed bomb proof cellars, raised barricades and planted artillery.[5] The powers, including the United States, combined to send a punitive expedition to Pekin, while the legationers settled down to a state of siege, determined to hold out as long as possible. At last on August 14, when the surviving foreigners were reduced to eating horse flesh and when scores had been killed or wounded, the relief column reached the capital. It was high time. The foreign quarters and much of the business portion, the banks, and the theatres had been burned, and the entire city threatened with destruction.

By the time that the uprisings in Pekin and elsewhere had been suppressed, it was evident that the powers would have a stern accounting with China. Hay had already openly announced the policy of the United States in his note of July 3, 1900; it was that the United States would seek a solution which should bring about permanent safety and peace to China, preserve the territorial entity of the country, protect the rights of friendly powers and insure an equal opportunity for all nations in the commerce of China. Hay continued through the negotiations to urge joint action on the part of the powers, and procured from them a statement disclaiming any purpose to acquire any part of China. At length in December, 1900, the demands upon China were formulated, to which that unhappy nation was compelled to accede. The most important were, punishment for the guilty rioters, safeguards for the future, indemnities for losses and the improvement of commercial relations. The financial indemnity finally placed upon China was $333,000,000, of which $24,000,000 was for the United States. The latter sum proved to be more than sufficient to satisfy all claims and China was relieved from the payment of about $11,000,000. As a mark of appreciation for this act, the Chinese government determined to use the fund in sending students to the United States for education.

While the problems concerning China and the colonial possessions of the United States were reaching a settlement, on September 6, 1901, President McKinley attended the Pan-American Exposition in Buffalo, where he was shot by a young fanatic. He died eight days later and Vice-President Roosevelt succeeded him.

BIBLIOGRAPHICAL NOTE

The framing, contents and ratification of the treaty of 1898 are well described in Chadwick, Latane and Olcott. The treaty itself is conveniently found in William MacDonald, Documentary Source Book of American History (new ed., 1916).

On imperialism: L.A. Coolidge, An Old-Fashioned Senator, O.H. Plat (1910); G.F. Hoar, Autobiography of Seventy Years, contains a strong argument against imperialism; A.C. Coolidge, United States as a World Power (1916).

The best accounts of the election of 1900 are in Stanwood, Croly and Latane.

The island possessions have given rise to a considerable body of special volumes of a high order. Especially useful are: (Cuba), Elihu Hoot, Military and Colonial Policy of the United States (1916), by McKinley's Secretary of War; L.A. Coolidge, O.H. Platt (1910); A.G. Robinson, Cuba and the Intervention (1905); C.E. Magoon, Republic of Cuba (1908), by the provisional governor during the second intervention. (Porto Rico), W.F. Willoughby, Territories and Dependencies of the United States (1905), by a former treasurer of Porto Rico; L.S. Rowe, United States and Porto Rico (1904). The most complete work on the Philippines is D.C. Worcester, Philippines: Past and Present (2 vols., 1914), by a member of the Commission; the valuable report of Commissioner Taft is in Report of the Philippine Commission, 1907, part 3, printed also as Senate Document 200, 60th Congress, 1st session, vol. 7, (Serial Number 5240).

The legal and constitutional aspects of imperialism are best followed in the Harvard Law Review, vols. XII, XIII; W.W. Willoughby, Constitutional Law of the United States (2 vols., 1910); C.F. Randolph, The Law and Policy of Annexation (1901); the "insular cases" are in United States Reports, vol. 182, pp. 1, 244.

The most complete account of affairs in China is P.H. Clements, The Boxer Rebellion (1915); J.B. Moore, Digest, vol. V (1906), is useful, as always; J.W. Foster, American Diplomacy in the Orient (1903), is clear and concise; W.R. Thayer, John Hay (2 vols., 1915), is disappointing.

* * * * *

[1] The American commissioners were W.R. Day, Secretary of State; Whitelaw Reid, editor of the New York Tribune; and Senators C.K. Davis, W.P. Frye and George Gray. Senator Hoar remonstrated with McKinley for placing senators on such commissions as this, on the ground that the independence of the Senate was thereby lessened when the question of ratifying the treaty came before that body. He declared that McKinley admitted that the practice was wrong. Cf. Autobiography, II, 46-51.

[2] Of the President's party, T.B. Reed, the powerful Speaker of the House, retired from public life for personal reasons and because of his dissent from the imperialist policy of his party. McCall, Reed, 237-8.

[3] Under the provisions of the Foraker Act only fifteen per cent. of the usual duties were to be paid on goods passing between the island and the United States, and since July 25, 1901, complete free trade has existed.

[4] The Philippine group is about 7,000 miles southwest of San Francisco; the chief island, Luzon, is almost exactly the size of Ohio, 40,000 sq. miles; the largest city, Manila, contained over 250,000 people at the time of the American occupation.

[5] It was on the occasion of despatching troops to avenge the death of Von Ketteler, the German minister, that the Emperor gave instructions to "give no quarter and to (act) so like Huns that for a thousand years to come no Chinese would dare to look a German in the face."



CHAPTER XIX

THE BEGINNING OF A NEW CENTURY

Most of the tendencies which characterized the growth of population, the expansion of the West, the concentration of the people in cities, the development of manufacturing and agriculture, and the extension of the railway system, from 1870 to 1890, were equally significant during the two decades following the latter year. Nevertheless there were important differences of detail in the tendencies of the later period; and about the year 1900 in particular there occurred changes that were far-reaching.



The rate of growth of population slowed up slightly after 1890, being twenty-one per cent. per decade, as contrasted with twenty-five per cent. from 1870 to 1890. The increases were distributed over a larger area during the later two decades, and aside from the industrial states, those which showed the greatest growth were Oklahoma, Texas and California. Immigration continued to be large, and concentrated in the north, especially in the cities. In New York city, for instance, forty per cent. of the inhabitants in 1910 were foreign born, and thirty-eight per cent. more were of foreign, or mixed foreign and native parentage. The chief European contributors to the population of America in 1910 in the order of their importance were Germany, Austria-Hungary, Russia, Ireland, Italy and England. Moreover the foreign elements had frequently become concentrated in especial states: the Germans in Wisconsin, Minnesota and Illinois; the Russians in New York, North Dakota and Connecticut; the Austrians in Pennsylvania and New Jersey; and the Irish in Massachusetts, Connecticut and New York. The immigration of Canadians, which had been of importance before 1900, appreciably slowed down after that year; and instead there was a distinct movement in the opposite direction, especially from Minnesota, North Dakota and Washington. The emigration was caused mainly by the desire to take up fertile lands which had been widely advertised by the Canadian government. The migration from the eastern states toward the West continued as in earlier years. It was noticeable, however, that whereas previous migration had been almost wholly on east and west lines, there was in later years a greater tendency to seek favorable openings wherever they were found. Oklahoma, for example, in 1910 contained 71,000 natives of Illinois, 101,000 Kansans and 162,000 Missourians. The trend of population toward the cities was so rapid between 1890 and 1910 as to suggest the likelihood that by 1920 half the people of the country would be living in communities of 2,500 persons or more. Of the twenty-three towns that more than doubled in numbers during the two decades after 1890, seventeen were in the South and on the Pacific Coast, indicating that the tendency toward urban life was no longer confined to the North and East.

Manufacturing increased its importance as the greatest economic activity in the Northeast, and was moving westward so rapidly that Ohio, Michigan, Indiana and Illinois found their interests becoming increasingly like those of the eastern states. Parts of the South, also, developed considerable industrial interests. The manufacture of cotton goods, for example, increased with such rapidity that three of the first five states in the value of their product in 1909 were southern states—North Carolina, South Carolina and Georgia. Since 1889 the production of lumber has taken a prominent place. Louisiana doubled its activity from 1889 to 1899 and had tripled this record by 1909. Almost the entire South from Virginia to Louisiana produced large amounts during the twenty years under consideration. The iron and steel industry in Alabama, and the production of turpentine, resin and fertilizers were other important southern interests. Throughout the country at large the number of wage earners engaged in manufacturing grew somewhat more rapidly than the population, being about twenty-five per cent. per decade from 1890 to 1910.

The center of agriculture continued to be in the Middle West, in which was to be found nearly fifty-three per cent. of the improved farm lands and fifty-eight per cent. of the value of all farm property. It was in this part of the country that the greatest increases in the amount of improved land took place, and particularly in the prairie country west of the Mississippi. By 1890 the Plains had lost their earlier unique and picturesque characteristics as a cattle country, and had given way to the homesteader. Hence the greatest expansion in agriculture took place in the tier of states from North Dakota to Texas. It appeared, therefore, that manufacturing was driving agriculture farther and farther to the west: New England cultivated less farm land in 1910 than in 1850; the improved area in New York, New Jersey and Pennsylvania declined after 1880; Ohio tilled fewer acres in 1910 than in 1900, and the gradual replacement of agriculture by manufacturing was observable in Indiana and Illinois. Oklahoma and Texas, on the other hand, together opened to cultivation between 1890 and 1910 nearly 24,000,000 acres, an expanse almost equivalent to the combined areas of New Hampshire, Vermont, Massachusetts and Maryland.

By 1890 it was clear that the future of the Far West lay in agriculture, rather than in the mining of the precious metals. Between that date and 1910, the amount of improved farm land in the section increased sixty-five per cent. In the states of Washington, New Mexico, Colorado, Idaho and Montana, large areas were placed under cultivation. In Washington the amount of improved farm land increased about 350 per cent. The growing of fruits and nuts was brought to a high state of excellence in the coast states. The timber industry developed after 1880 and particularly after 1900. About the close of the nineteenth century the great lumber companies began to seek sources of supply to take the place of those around the Great Lakes. They turned to the South and the Far West. The methods which were used for getting control of the land, and the recklessness with which the supplies of timber were cut off became of importance as causes of the conservation movement. The main handicap in the way of the development of trade between the Far West and the East was the great distances involved. Hence arose the interest of the Coast in transcontinental railway rates and the project for a canal across the isthmus of Panama.

An economic fact of no little importance was a change in the downward tendency of the price level after 1896. It will be remembered that the constant fall in prices from 1873 to 1896 had brought distress to the farmers of the West and had been one of the causes of the Populist revolt. After 1896 the process was reversed. Between that year and 1913 the quantity of gold in circulation considerably increased, as has been seen; bank deposits subject to check trebled in volume, and the use of checks became more common; altogether it was estimated by Professor Irving Fisher that the quantity of money in circulation increased two-fold. Prices were fifty per cent. higher in 1913 than in the earlier year, and accordingly the complaints of the farmer were less frequently heard. The wage earner in the factories, however, was differently affected. The price which he had to pay for the necessities of life increased faster than his wages, so that his standard of living was going down. Inasmuch as the number of wage earners in the factories was rapidly increasing, it seemed inevitable that the problem of rising prices after 1896 would constitute as great a problem as the problem of falling prices had done before that year.



In industrial enterprise the close of the nineteenth century and the opening of the twentieth were characterized by a mad rush toward consolidation. To a milder degree the process had, of course, been under way for many years, during which the Standard Oil Company and other trusts were the subject of much study and legislation. In the course of time some of these concerns made such great profits that their leaders sought attractive openings for the investment of their surplus. They began to appear on the boards of directors of railways, banks, electric lighting companies and other industrial organizations. Before 1900 two powerful groups had definitely formed. The Standard or Rockefeller group was obtaining large interests in such railroads as the Missouri, Kansas and Texas, the Delaware, Lackawanna and Western, and the Chicago, Milwaukee and St. Paul. It was reaching out to the gas and electric companies in New York, had an alliance with the National City Bank and others, and was in touch with great life insurance companies such as the Equitable and the Mutual of New York. Such connections enabled them to determine the policies and direct the investments of these important concerns. The Morgans extended their influence over the Philadelphia and Reading, the New York, Lake Erie and Western, the Lehigh Valley and others. Morgan himself also entered the industrial field as organizer of the Federal Steel Company and the National Tube Company.

The mania for organizing large corporations came to a climax about 1900. The census taken in that year noted ninety-two that had been formed between January 1, 1899, and June 30, 1900. Early in 1904 the editor of Moody's Manual of Corporation Securities noted the existence of 440 large industrial and transportation combinations whose capitalization as measured by the par value of their stocks and bonds was nearly $20,500,000,000. The securities—stocks and bonds—of the new companies were eagerly taken up by the investing public. Prosperity was wide-spread and the financial strength behind the organizations seemed unlimited. Speculation became common. A few individuals amassed wealth through the shrewd purchase and sale of stocks, and countless others sought unsuccessfully to imitate them. Where sales of 400,000 shares on the stock exchange had formerly been looked upon as a good day's business, the record jumped to a million, then two, and even three.[1]

A threatened competitive struggle among certain steel manufacturers in 1901 led to the formation of the United States Steel Corporation, the most famous consolidation of the period. It was, strictly speaking, a "holding corporation" which did not manufacture at all, but merely held the securities and directed the policies of the group of companies of which it was composed. It integrated all the elements of the industry—ore deposits, coal mines, limestone, a thousand miles of railroads, ore vessels on the Great Lakes, furnaces, steel works, rolling mills and other related interests. The value of the tangible property which was thus brought under the control of a single group of men was estimated by the United States Commissioner of Corporations at about $700,000,000. The company issued securities, however, to somewhat over twice this amount. In other words, about $700,000,000 of the capitalization was "water," that is, securities issued in excess of the value of the tangible properties owned. The prices paid to those who controlled the constituent companies were such as to make them multi-millionaires over night, and the commission given to the financiers who organized the Corporation was unparalleled in size, amounting to $62,500,000.

The appreciation of the value of the ore deposits controlled by the Steel Corporation later replaced some of the water in its securities, but in many cases no such process came about. Investors therefore discovered that the paper which they had purchased did not represent real property, but merely the hope of a company that its profits would be large enough to provide returns upon all its securities. One hundred of the leading industrial stocks shrank in value $1,750,000,000 within eighteen months. In the case of the Steel Corporation it was noticeable that its supremacy depended to a large extent on the possession of resources of ore on land much of which had originally belonged to the public, a fact which, the Commissioner of Corporations remarked, made the affairs of the company a matter of public interest.

The growth and consolidation which characterized the history of industry were also taking place in the railway system, although somewhat more slowly. It has already been noted that the length of the railroads had reached 160,000 miles by 1890. For the next two decades the rate of construction diminished slightly, yet the total in 1914 was 252,231 miles, and the par value of all railroad securities was estimated at $20,500,000,000. Nearly four and a half million persons, a railroad president estimated in 1915, were at that time interested in the industry as employees, as workmen in shops making railroad supplies, or through the ownership of stocks and bonds.

The management of the roads is, of course, continually changing; alliances are made and broken; groups form and dissolve. About the time that the United States Steel Corporation was being organized, however, about ninety-five per cent. of the important lines were in the control of six groups of influential persons, which were dominated by fourteen individuals. Each group had obtained the upper hand in the roads of one or more sections. The Morgan-Hill group, for example, held the Chicago, Burlington and Quincy, the Northern Pacific, the Great Northern, the Southern, the Atlantic Coast Line, the Erie and others, amounting to 47,206 miles. E.H. Harriman, chairman of the board of directors of the Union Pacific, succeeded in obtaining control of so many lines that by 1901 the Interstate Commerce Commission asserted that the consummation of plans which he then had in mind would subject nearly one-half the territory of the United States to the power of a single will. Before his death in 1909 he had obtained practical control of a system of roads running from coast to coast and passing through the most important cities of the country and had planned to continue indefinitely the process of acquiring new lines.



The concentration of the banking interests of the country went hand in hand with consolidation in industry and railway control. The unprecedented operations which have just been mentioned demanded unprecedented amounts of capital and credit, and the concentration of these necessities occurred in New York City. The Standard Oil group and the Morgan group dominated the banking interests to such an extent that it was doubtful whether any great business enterprise demanding large capital could be started without the aid of one or the other of them. Some years later a congressional investigation was started, to discover whether the control of a few men over the financial affairs of the nation amounted to a "money trust," and at that time it was found that the members of four allied financial institutions in New York City held 341 directorships in banks, insurance companies, railroads, steamship companies and trading and public utility corporations, having aggregate resources of $22,245,000,000.

The financial power thus placed in the hands of a small number of men was the cause of much legislation passed by the states and by Congress in connection with the railroads and trusts. Opinions varied widely in regard to the effects of concentration. On the one hand it was argued that the men of greatest ability and vision naturally came to the top; that industry received the necessary stabilizing influence; that production and demand were compelled to harmonize; that scientific research directed toward the discovery of new processes and products, and the better utilization of old ones could be successfully carried on only by concerns with large resources; and that efficiency and economy resulted from large-scale operation. On the other hand it was pointed out that a small number of persons who were responsible to nobody could dominate the fortunes of hundreds of thousands of wage earners, manipulate production, make or break a region or a rival, bring about financial crises and, in a controversy or for private gain, use a great industry or a railroad as a weapon and wreck it regardless of the welfare of the public at large.

Among the intellectual forces underlying American history after 1890, a prominent place should be given to the expansion of the public library, the growth of public education and the development of the press. Many libraries, of course, had been established long before the Civil War—the Library of Congress, for example, having been founded in 1800—but the great growth of the public library supported by taxation and open to all citizens alike occurred after 1865. Between that year and 1900 no fewer than thirty-seven states passed laws enabling the towns within their borders to levy taxes for the support of public libraries; private bequests amounted to fabulous sums, the outstanding example of which were the gifts of Andrew Carnegie, amounting to $62,500,000 between 1881 and 1915. By 1914 there were over 2,000 libraries containing at least 5,000 volumes, and forty that contained more than 200,000 each.

The significant features in the growth of education between 1865 and 1890 had been the improvement of the public grammar school, the establishment of high schools and the foundation of the great state universities. After 1890 the public high schools were greatly improved, business and vocational courses were added, and the enrollment at the colleges and universities received large additions. Such universities as that in Wisconsin exerted an unusual influence on intellectual and political currents in individual states.

A large proportion of the political, social and economic changes and reforms that have taken place in the United States since 1890 have done so because public opinion was educated, quietly influenced or noisily bestirred by the press. Governors and presidents appealed to their constituents through the newspaper and the periodical. Political campaigns have become increasingly matters of publicity; candidates for office have their press bureaus; corporations, abandoning their traditional policy of silence, explain their practices; and railroads defend their policies by means of advertisements in the newspapers. Newspaper correspondents go out through the country months before candidates for the presidency are nominated, and discover and publish sentiment favorable to the individual whom the particular organ desires to see placed in office. In 1918 the circulation of the daily newspapers amounted to approximately 28,000,000 copies for each issue. In the North, the Middle West, and on the Pacific Coast the number published was sufficient to provide every family with one copy. The South and the Rocky Mountain region were less well supplied. The great metropolitan newspapers circulate widely, not only in the immediate vicinity of the publisher's office, but over a wide area outside. At least one of them in 1918 approached half a million copies daily, another exceeded 800,000, and a third issued nearly three-fourths of a million on Sunday. William R. Hearst established a chain of newspapers which gave him an audience of over a million readers every day. Several of the weekly and monthly magazines circulated in hundreds of thousands of copies; and one weekly periodical which presented newspaper opinion of all shades of political partisanship had a circulation of 750,000 copies for every issue.



The rise of the "muck-rake"[2] magazines was typical of the ten years at the opening of the twentieth century. These periodicals printed articles which portrayed a side of American life not commonly discussed in the newspapers. One of the earliest serials of this type was Miss Ida M. Tarbell's History of the Standard Oil Company, published in McClure's Magazine in 1902-1903. Instead of the ordinary eulogy of the size and success of the Company, Miss Tarbell presented many of its unfair practices. At the same time and in the same publication Lincoln Steffens was exposing the seamy side of municipal affairs in "The Shame of the Cities." Between 1901 and 1906 one of the muck-rake periodicals increased its sales threefold, another four and another seven.

Cooperation among newspapers in the gathering of information is no novelty in the United States, but the greatest strides have been taken since 1890. By 1915 the Associated Press had leased 50,000 miles of telegraph wires forming a net all over the country; it had agents in every important news center; it exchanged services with three European press associations; and it had its own representatives not only in London, Paris, and Berlin, but in Fez, Madeira, Colombo, Tsingtau and Sydney. News from Europe reached New York in less than an hour and was promptly sent to 900 newspapers, whence it was copied in thousands of daily and weekly publications. As in the case of other enterprises the publication of newspapers showed a tendency towards consolidation. The establishment of a new periodical became a million-dollar venture, and it remains to be seen whether the tendency toward centralization will result in the publication only of such news or such phases of the news as meet the approval of the relatively small number of persons that can launch a million-dollar organization.

It will be remembered that laissez faire was the prevailing theory in regard to the proper relation between government and industry during the twenty-five years after the close of the Civil War, except in so far as industrial organizations desired protective tariffs. In brief the upholders of this creed contended that legislation should concern itself as little as possible with the regulation of trade, that it should restrict itself to protecting commerce from interference and that business men should be permitted to work out their own problems with the least possible reference to such artificial forces as were supplied by legal enactments.[3] It would be inaccurate to say that the theory of laissez faire had completely given way by the end of the half century after the Civil War. Nor would it be wholly correct to say that any other theory has yet demonstrated its permanent reliability, Nevertheless the distinctive philosophy upon which later legislation has been built is the theory of public interest. The theory needs definition in some detail, because it forms the philosophy which underlies most of the political developments and much of the legislation of the early twentieth century.

As the men of the eighties and nineties contemplated the vast amounts of wealth created during those decades they saw it concentrated to a great extent in the hands of the few. The few believed that the public good was best cared for in this way, but an increasing majority of the people looked upon the tendency with greater and greater alarm. They complained that the railroads discriminated in favor of the powerful few; that corporations were achieving monopoly; and that the government itself often assisted the process by framing tariff schedules primarily for the interest of the manufacturers. When the reaction against this situation started, it was of course found that the seats of power were already occupied by the adherents of laissez faire,—the party committees, the legislatures, the executive offices and the courts. There ensued, therefore, a long struggle for power and for a new theory of government. The land-marks of the controversy were to be found in interstate commerce acts, anti-trust laws, income taxes, bureaus of labor and factory legislation.

The proponent of laissez faire would allow the few to accumulate large fortunes which they might share with the many through benefactions, gifts to education, libraries, and other public enterprises; the adherent of public interest would inquire why the many are poor, and attempt so to change economic conditions as to reduce the number of the poor to a minimum. Instead of framing laws so that wealth and power would get into the hands of a small number of individuals, in the expectation that prosperity would filter down to the many, the advocate of public interest would aim his legislation directly at what he considers the needs of the less powerful classes. He would interfere with the railroads, for example, to compel them to charge uniform rates, prevent corporations from electing public officers by means of large contributions to campaign funds, force industry even at some cost to protect employees through safety devices, and would hold the great forests on the public lands for the direct good of the whole people. The transfer of emphasis from laissez faire to public interest was based upon a steady growth in the value placed upon the worth of the individual man, and upon a shift from legislating for the few to legislating directly for the multitude. The change was greater than can be indicated by citing any one law or group of laws. It was "a new intellectual perspective through which we view all moral issues affecting society."[4]

Underlying many of the difficulties in the way of replacing laissez faire with a new theory, was the attitude of the courts toward certain parts of the Fourteenth Amendment. It will be remembered that a portion of section one of the Amendment forbids the states to "deprive any person of life, liberty, or property, without due process of law." It will also be remembered that the majority of the Supreme Court in early decisions interpreting the Amendment had expressed the belief that its purpose was the protection of the negro. By 1890, however, the Court had come to hold that the word "person" as used in the first section included corporations, and thus had given the language of the Amendment a greatly widened application. Of 528 decisions given by the Court on the Amendment between 1890 and 1910, only nineteen concerned the negro race, while 289 affected corporations. In the decision of the case Lochner v. New York, a state law regulating hours of labor in bakeries was declared to conflict with the Amendment, because the right of the laborer to work as many hours as he pleased was part of the "liberty" which was protected by the Amendment. Laws regulating railroad rates through commissions were held to deprive corporations of property without due process. Until recently changed, the statutes did not allow appeal to the Supreme Court in cases where state courts declared state laws in conflict with the United States Constitution, and the Fourteenth Amendment therefore acted as a protective bulwark in state as well as nation. In brief, then, the legal position of the big industrial organizations was almost impregnable because of the fortuitous circumstance that the words of a part of the Constitution might be held to mean something which probably did not enter the minds of the Congress or the state legislatures which placed the words in the document.

The people of the United States have usually avoided hostile criticism of the Constitution and the decisions of the Supreme Court, and they have reflected this feeling in their acquiescence in the unexpected turn given to the meaning of the Fourteenth Amendment. The members of the Court, however, have frequently expressed disquietude. Dissenting opinions opposing the view which the Court has taken, have been common. Mr. Justice Harlan declared that the scope of the Amendment was being enlarged far beyond its original purpose; Mr. Justice Holmes asserted that the word "liberty" was being "perverted" and that the Constitution was not intended to embody laissez faire or any other economic theory.[5]

The most prominent pioneers in replacing the old by the new theory were William J. Bryan, Robert M. La Follette and Theodore Roosevelt. Bryan's leadership in 1896 has already been mentioned. With courage and sincerity he attempted to solve the social and economic problems of his day, but his youth, his inexperience, his radicalism, and the fact that he did not choose issues that were immediately practicable made it impossible for him to command the confidence of the majority. Unable himself to scale the heights of reform, he nevertheless pointed them out to others. With a voice that has been likened to an organ with a hundred stops, with persistence, energy and good nature he spread far and wide a new conception of social obligation. He insisted that the social and economic discontent of the South and West were real, and that they could not be laughed out of court or frightened into silence.

La Follette's constructive pioneer work was done for the most part in Wisconsin. During the ascendency of the laissez faire theory, the state was largely controlled by the lumber, railroad and other interests, using the Republican party as their political agency; and a small but powerful group controlled the election of state and federal officials, the press and state legislation. Between 1885 and 1891 La Follette, who was himself a Republican, was a representative in the federal House. In the latter year he came into collision with Senator Sawyer, a wealthy lumber merchant who was the leader of the dominant party in the state. For years the state treasurers had been lending the state's money to favored banks without interest. Senator Sawyer had acted as bondsman for the treasurers and was sued by the attorney-general of the state for back interest. La Follette threw himself into this controversy on the side of the state; and being unable to obtain a hearing through the usual medium of the press, he and his supporters went directly to the people, speaking from town to town before interested audiences; and subsequently the state won.

In the Sawyer controversy were visible all the elements of the later creed and methods of La Follette. He always remained with the Republican party, preferring to attempt change from within; and he always opposed the interests and found his strength in direct appeals to the people of his state. Out of those years came the "Wisconsin idea,"—a program which included the taxation of railroads and corporations, primaries in which the people could nominate their own candidates for office, the prohibiting of the acceptance of railroad passes by public officials, and the conservation of the forests and water power of the state. The conflict between laissez faire and public interest in Wisconsin was long and bitter, but it led to a series of triumphs for La Follette, who was elected governor in 1900, 1902 and 1904, and chosen to the federal Senate in 1905. In the meanwhile there was a widespread demand throughout the West for legislation along the lines marked out by Wisconsin.

Party lines are so drawn in the United States that it is difficult for like-minded men of different parties to cooperate in furthering a program. The three pioneers were men whose capacities and personal qualities differed greatly, but in their economic and political philosophy they were nearer to one another than to the rank and file of their own parties. Bryan in 1902 refused to take part in the Democratic campaign in Wisconsin because he favored La Follette's program, and in 1905 he even aided the latter in his fight for railroad regulation; in 1912 Bryan found Roosevelt leading a revolt in the Republican party on a program to much of which he could give unqualified assent; and of La Follette, Roosevelt said in the same year: "Thanks to the movement for genuinely democratic popular government which Senator La Follette led to overwhelming victory in Wisconsin, that state has become literally a laboratory for wise experimental legislation aiming to secure the social and political betterment of the people as a whole."

Roosevelt's own share in the history of the early twentieth century was of such magnitude as to require a more extended account.

BIBLIOGRAPHICAL NOTE

The literature is voluminous and not easy to evaluate. On population changes and immigration, the best source is the Abstract of the Thirteenth (1910) Census (1913), with the Atlas accompanying it (1914); Reports of the Immigration Commission, appointed under the Congressional Act of Feb. 20, 1907 (42 vols., 1911), is exhaustive; F. A. Ogg, National Progress (1918), has a good chapter; consult Joseph Schafer, A History of the Pacific Northwest (rev. ed., 1918), for Washington and Oregon.

The consolidation in industry, railroads and finance may be followed in: A.D. Noyes, Forty Years of American Finance (1909); John Moody, The Truth about the Trusts (1904); Report of the Commissioner of Corporations on the Steel Industry (3 parts, 1911), on the United States Steel Corporation; Anna P. Youngman, Economic Causes of Great Fortunes (1909); C.R. Van Hise, Concentration and Control a Solution of the Trust Problem in the United States (rev. ed., 1914); E.R. Johnson and T.W. Van Metre, Principles of Railroad Transportation (1916); John Moody, The Railroad Builders (1919); John Moody, The Masters of Capital (1919); and Report of the Committee Appointed Pursuant to House Resolutions 429 and 504 to Investigate the Concentration of Control of Money and Credit, (Pujo Committee) 1913.

There is no satisfactory study of the social and political effects of the great increase in the circulation of newspapers and periodicals. Suggestive articles are: World's Work (Oct., 1916), "Stalking for Nine Million Votes"; Arena (July, 1909), "The Making of Public Opinion"; Atlantic Monthly (Mar., 1910), "Suppression of Important News." Less superficial articles are those of Walter Lippmann in the Atlantic Monthly (Nov., Dec., 1919). The statistics are available in N.W. Ayer, American Newspaper Annual and Directory.

The emergence of the theory of public interest is best seen in the Autobiography of R.M. La Follette (4th ed., 1920); consult also Theodore Roosevelt, Autobiography, and C.G. Washburn, Theodore Roosevelt; the Logic of his Career (1916). A profound article is W.J. Tucker, "The Progress of the Social Conscience," in Atlantic Monthly (Sept., 1915).

On the Fourteenth Amendment, consult the volumes already mentioned under Chap. IV.

There are no thorough estimates of Bryan and La Follette. On the former: Atlantic Monthly (Sept., 1912), and Nineteenth Century (July, 1915); H. Croly, Promise of American Life (1914), is critical. W.J. Bryan, First Battle (1897), is essential. On La Follette, his own narrative as given in the Autobiography is best, but should be read with care as it was written in the heat of partisan controversy. See also F.C. Howe, Wisconsin an Experiment in Democracy (1912), friendly to La Follette.

Frank Norris, The Octopus, and The Pit; Winston Churchill, Coniston and Mr. Crewe's Career; and Upton Sinclair, The Jungle, are illustrative fiction.

* * * * *

[1] The shrinkage of the value of these securities caused the "rich men's panic" of 1903. Consult Noyes, Forty Years, 308-311.

[2] The word originated in 1906 with President Roosevelt, who likened certain sensational journalists to the man with the Muck-Rake in Bunyan's Pilgrim's Progress. Annual Register, 1906, 442.

[3] Cf. pp. 94-96 above.

[4] I have drawn largely at this point upon Dr. W.J. Tucker's article "The Progress of the Social Conscience" in the Atlantic Monthly, Sept., 1915, 289-303. The clearest idea of the transition from laissez faire to public interest is gained by reading the biography of M.A. Hanna by Croly, and La Follette's and Roosevelt's autobiographies.

[5] Usually cases involving the Fourteenth Amendment have also involved other parts of the Constitution. The main reliance, however, in such cases has been the Amendment mentioned.



CHAPTER XX

THEODORE ROOSEVELT

Seldom, in times of peace, is the personality of a single individual so important as that of Theodore Roosevelt during the early years of the twentieth century. At the time of his accession to the presidency, he lacked a month of being forty-three years old, but the range of his experience in politics had been far beyond his age. In his early twenties, soon after leaving Harvard, he had entered the Assembly of the state of New York. President Harrison had made him Civil Service Commissioner in 1889, and he had been successively President of the Board of Police Commissioners of New York City, Assistant Secretary of the Navy, an important figure in the war with Spain, and Governor of New York. He had been known as a young man of promise—energetic, independent and progressive—and in addition to his political activities he had found time to write books on historical subjects, see something of life on a western ranch and develop a somewhat defective physique into an engine of physical power.

Brimming with energy, nimble of mind, impetuous, sure of himself, quick to strike, a fearless foe, frank, resourceful, audacious, honest, versatile—Roosevelt possessed the qualities which would challenge the admiration of the typical American. One who frequently saw him at work described thus the way in which he prepared a message to be sent to the Senate:

He storms up and down the room, dictating in a loud and oratorical tone, often stopping, recasting a sentence, striking out and filling in, hospitable to every suggestion, not in the least disturbed by interruption, holding on stoutly to his purpose, and producing finally, out of these most unpromising conditions, a clear and logical statement, which he could not improve with solitude and leisure at his command.

The breadth of his interests, the democratic character of his friendships—for he was equally at home with blue-stocking, politician, cowboy and artisan—his complete loyalty to his friends and his disregard of conventionalities gave him a grip upon popular favor that had not been duplicated since the days of Andrew Jackson, unless by Lincoln. The effectiveness of so compelling a personality was in no way diminished by Roosevelt's possession of what a journalist would call "news sense." He was made for publicity; he had an instinct for the dramatic. His speeches were removed from mediocrity by his evident sincerity, his abounding interest in every occasion at which he was called upon to talk and the phrases that were half victories which he coined almost at will. "Mollycoddle," "muckraking," "the square deal," "the big stick" became familiar idioms in the vernacular of politics and the street. The political leadership of Roosevelt rested mainly upon his personal prestige and upon his attributes as a reformer. With unerring prescience he chose those political issues which would make a wide appeal and which could be pressed quickly to a successful conclusion. His complete integrity saved him from mere opportunism; his ruggedly practical commonsense saved him from that combination of high purpose and slight accomplishment which has characterized many other reformers.

No estimate of the deficiencies in Roosevelt's personality and leadership would be agreed upon at the present time. In some cases—as in the realm of international relations—only the future can decide whether he was a prophet or a chauvinist; in all cases, opinions have differed widely, for Roosevelt could scarcely explore a river, describe a natural phenomenon or urge a political innovation without thereby arousing a controversy in which his friends and his opponents would participate with equal intensity. His identification of himself with his purposes was as complete as that of Andrew Jackson; opposition to his proposals was reckoned as opposition to him as an individual. Like many leaders of the fighting type, he was frequently weak when judging the motives of those who disagreed with him. One of his admirers declared that his greatest political defect was an impatience of any interval between an expressed desire for an act and the accomplishment of the deed itself—an inability to stand through years of defeat for the future success of an ideal. A keener and equally sympathetic critic dubbed him the "sportsman" in politics—honest, hard-hitting, but playing the issue which had an immediate political effect.

At the outset of his administration Roosevelt was apparently an adherent of the prevailing Republican creed—protective tariff, gold standard, imperialism, laissez faire and the rest. His first official utterance after becoming President was an indication that he would continue unbroken the policies of his predecessor, and to this end he insisted that the cabinet should remain intact.[1] His foreign policy was aggressive; his interest in the military and naval establishments real and constant. Roosevelt was more venturesome than McKinley, and more ready to experiment with new ideas. He took up the duties of his position with an unaffected zest and enthusiasm; he looked upon the presidential office as an exhilarating adventure in national and even international affairs. As time went on, therefore, it became more and more evident that he was prepared to play a big role on a great stage. Moreover, few doubts concerning the constitutional powers of the executive position seem ever to have assailed him. Whatever may have been his theory at the outset of his presidency, he came eventually to believe that the executive power was limited only by the specific restrictions and prohibitions appearing in the Constitution, or imposed by Congress in laws which it had constitutional authority to pass. The scope which this theory presented for the exercise of his energetic originality is evident when contrasted with the theory of his predecessors, who had, in times of peace, held to the belief that the executive possessed only the powers specifically designated by the Constitution.

Not until some future time, when the events of the early twentieth century are better understood, will it be possible to judge accurately the value of President Roosevelt's regime in its relation to the control of railroads and corporations. There can be no doubt, however, that one of the most serious problems that faced the American people during that time was the position which the government ought to occupy toward the business interests of the nation. Not only were the railroads and the great corporations the center of the economic life of the people, but their social and political effects were momentous.

Neither the Interstate Commerce Act of 1887 nor the Sherman Anti-trust law of 1890, it will be remembered, had accomplished what had been expected of them. The Interstate Commerce law had met with grave obstacles in the courts; the Sherman act had been seldom invoked by the federal executive, and in the most prominent case, United States v. E.C. Knight Co., the government had failed to obtain the decision it desired. Government regulation seemed like a broken reed.[2] A few cases, however, had indicated the possibility that strength might be discovered in the law. In United States v. the Trans-Missouri Freight Association, the Supreme Court had declared that the Anti-trust act applied to railroads and that it forbade agreements among them to maintain rates; two years later, in 1899, the Court pronounced illegal a combination of pipe manufacturers in the Middle West, on the ground that its result was to restrain interstate commerce.

Roosevelt, like Bryan and La Follette, had been groping his way to an understanding of the importance of the new problem. During his term as Governor of New York he had clashed with the older political leaders when he supported an act looking to the heavier taxation of railway franchises. The first recommendations in his message to Congress on December 3, 1901, concerned the subject of the relation of government and industry. The accumulation of wealth in recent years in the United States, he asserted, had been due to natural causes, and much of the antagonism aroused thereby was without warrant. Nevertheless grave evils had attended the process: overcapitalization was one; untruthful representations concerning the value of the properties in which business asked the public to invest was another. Such evils should be attacked; with extreme care, to be sure, but also with resolution. Combination and concentration, he thought, should be supervised and, within reasonable limits, controlled. The remedies which the President suggested were simple: in the interest of the public the government should have the right to inspect the workings of organizations engaged in interstate commerce; because of the lack of uniformity in corporation legislation within the states, the federal government should so extend its power as to include supervision of corporations; a Department of Commerce and Industries should be established, whose head should be a cabinet officer; the Interstate Commerce law should be amended; railway rates should be just, and should be the same to all shippers alike, and the government should be the agent to provide a remedy to this end.

The enthusiastic reception accorded the message by the press indicated that one or another of its numerous recommendations met with approval. The effect on Congress, however, of the portion dealing with interstate commerce was represented by a cartoon in the New York World. Uncle Sam was there portrayed stowing away for later attention a bundle of manuscript labelled "President's Message 1901. 30,000 words," while he smilingly remarked "When I git time!" But Roosevelt was not content to let the matter drop, and in the following summer he took the unusual step of carrying his message directly to the people. In the New England states first, and later in the West, he declared his creed on the federal regulation of industry. The effectiveness of the campaign was increased by the moderation of the President, by his increasing popularity and by the many telling phrases, with which he enforced his main thesis. The Sherman act looked less like a broken reed when the chief executive of the nation declared: "As far as the anti-trust laws go they will be enforced ... and when (a) suit is undertaken it will not be compromised except upon the basis that the Government wins." Here and there objection was raised that the program was not sufficiently definite; now and then a critic hazarded a conjecture that Roosevelt had not consulted the leaders of his party; but in the main he succeeded in obtaining a sympathetic hearing. At this juncture the coal strike of 1902 gave him one of those fortunate opportunities which were commonly referred to as a part of "Roosevelt's luck." With no uncertain hand he seized the opportunity which chance presented.

Before 1899, there had been no organization of the anthracite miners with sufficient strength to force any changes in the conditions under which the men performed their work. During that year the United Mine Workers of America began to send organizers into the Pennsylvania region. In 1900 the men struck, but an agreement was reached with the operators and work was resumed. The settlement, however, was not satisfactory to either side, and in 1902 the workers asked for a conference. The presidents of the coal companies and the coal-carrying railroads replied that they were always ready to meet their own employees but would have no dealings with a general labor organization. Smaller causes of unrest were the demand for more pay, shorter hours, and payment for coal by weight instead of by the car, but the fundamental issue was the recognition of the union—the workmen insisting on collective bargaining, the operators refusing it. The men were helpless except as a union; the roads were sure of keeping the upper hand if they dealt with the men individually or in small groups. When attempts at conference failed, the miners struck and from May 12 until October 23 nearly 147,000 of them remained idle. The total loss to miners and operators was nearly $100,000,000.

Since the Pennsylvania fields were almost the sole source of supply for anthracite coal, discomfort was soon felt in the North and West, and as the cooler weather came on, suffering became acute and public feeling bordered on panic. A winter without hard coal could hardly be contemplated without grave misgivings. Popular opinion, meanwhile, went increasingly to the side of the miners. The refusal of the operators to confer, and the propriety of the conduct of the workmen made a wide impression that was favorable to the union. Moreover, George F. Baer, President of the Philadelphia and Reading Company, spoke of himself and his associates in a letter to a correspondent as those "Christian men to whom God in His infinite wisdom has given the control of the property interests of the country." The remark was widely quoted and generally looked upon as evidence of a selfish and uncompromising individualism.[3] The strike having now become a matter of national importance, President Roosevelt requested the operators and representatives of the miners to meet him in Washington, October 3. At this conference the spokesman of the railroads refused mediation, while the leader of the United Mine Workers, John Mitchell, proposed arbitration and pledged the workers to accept it.

After the refusal of the operators to accept the President's conciliatory offer, he decided to apply pressure. He obtained the consent of Grover Cleveland to act as chairman of a commission of investigation and determined to seize the mines by military force, if necessary, operate them as a receiver and await the report of his commission. In some way, which can not now be indicated with certainty, the operators were influenced to accept mediation, and the President appointed a commission with Judge George Gray as chairman.[4] The miners immediately returned to work, coal began again to flow to the North, and public rejoicing was extreme. The President's Commission at once repaired to Pennsylvania, heard 558 witnesses, visited the mines, and inspected machinery and the homes of the miners. It concluded that neither side was completely in the right, and therefore made an award that satisfied some of the complaints of both parties. In the history of the relation between the federal government and the business interests of the nation, the anthracite strike of 1902 is of marked significance. The operators had given evidence of a failure to understand that their business so concerned the nation that the interest of the public in it must be heeded. The successful outcome enhanced the prestige of the government and of the President, and an example of the need of greater control over corporations received wide publicity at the precise moment when the general subject was uppermost in the popular mind.

The first legislative evidence of the result of the agitation for the more effective regulation of industry was an act approved on February 11, 1903, by which any suit brought in a Circuit Court by the United States government under the Sherman Anti-trust act or the Interstate Commerce law, could be given precedence over other cases at the desire of the Attorney-General. Three days later a law was passed which established a Department of Commerce and Labor, whose chief was to be a cabinet officer. Included in the Department was a Bureau of Corporations headed by a Commissioner, who was authorized to investigate the organization and conduct of the business of corporations. Within another five days the Elkins Act had been passed—a law designed to eliminate rebating. Despite the Interstate Commerce act, the practice of rebating had continued. Agreement was general that railroad men who, in other respects, were perfectly scrupulous, commonly violated the law in order to get business in competition with their rivals. Among the railroad men who had violated the law but who deprecated the necessity of so doing, was Paul Morton, president of the Santa Fe system. Morton volunteered to assist Roosevelt in stamping out the evil, and the Elkins law was designed to aid in this process. It forbade any variation from published rates, made both a corporation and its agents punishable for offenses against the law, prohibited the receiving of rebates as well as giving them, and made the penalty for failure to observe the provisions of the Act a fine of one thousand to twenty thousand dollars. Furthermore, during February, 1903, Congress appropriated $500,000 to be expended under the direction of the Attorney-General for the better enforcement of the anti-trust and interstate commerce laws.

In 1903, likewise, was initiated an important judicial proceeding in the direction of the enforcement of the Sherman law. The Great Northern Railway Company and the Northern Pacific Railway Company operated parallel competing lines of road extending from the region of Lake Superior to the Pacific Coast. An attempted consolidation of the two had been declared illegal under the statutes of the state of Minnesota. On November 13, 1901, under the leadership of two of the foremost railway magnates of the nation, J.J. Hill and J.P. Morgan, there had been organized the Northern Securities Company, to purchase and control at least a majority of the shares of the capital stock of the two lines of railway. In this way the two roads would be operated as one, their earnings pooled, competition between the two eliminated and a virtual consolidation effected. On the advice of the Attorney-General, Philander C. Knox, President Roosevelt directed that proceedings be instituted against the holding company—an act that seemed almost useless in view of the decision of the Supreme Court in the Knight Case. But the decision in the Northern Securities Case, handed down in 1904, was a surprise. By a vote of five to four the Court declared the company a combination in restraint of trade, and therefore illegal under the Sherman act, and enjoined any attempt on its part to control the affairs of either of the two railways.

Nineteen hundred and four, the year of the presidential election, found Roosevelt in a strong position. His success in handling the coal strike and his energetic preparations for the crusade against trust evils had struck a responsive chord in the popular mind. Late in 1903 he had announced to Congress that frauds had been discovered in the post office and land office, and urged the appropriation of funds for the prosecution of the offenders. The result was a house-cleaning which involved the conviction of many officials, including two United States senators. Roosevelt's popularity became greater than ever.

It was to be expected, however, that some opposition would appear to the nomination of Roosevelt for a continuation of his term of office, and it was around the forceful Mark Hanna that the opposition began gradually to center. Hanna had attained remarkable influence as a senator, was highly trusted by the business interests and was popular among southern Republicans. But his death in February, 1904, effectively ended any opposition to Roosevelt, since it was then too late to focus attention upon any other competitor. The Republican nominating convention, therefore, which met in Chicago on June 21, lacked any semblance of a contest, and the President was renominated without opposition. The platform was of the traditional sort. The history of the party was approved; its achievements in giving prosperity to the country and peaceful government to the island possessions were recounted; the protective tariff, the gold standard, an isthmian canal, the improvement of the army and navy, the continuation of civil service reform and a vigorous foreign policy,—on all these the party utterance was that of other days. Surprisingly little was said upon the subject of the regulation of corporations. The few steps already taken were approved, but as to the future, the platform was almost colorless:

Combinations of capital and of labor are the results of the economic movement of the age, but neither must be permitted to infringe upon the rights and interests of the people. Such combinations, when lawfully formed for lawful purposes, are alike entitled to the protection of the laws, but both are subject to the laws, and neither can be permitted to break them.

The Democratic convention met in St. Louis on July 6, and the excitement which marked its proceedings compensated for the lack of interest at the Republican meeting. As drawn up by a sub-committee of the Committee on Resolutions, the platform was, in many of its planks, a distinct return to the programs of the days before 1896. It urged a reduction of the tariff, generous pensions and civil service reform, together with the enforcement of the anti-trust laws and the popular election of senators. In the main, it was devoted to a condemnation of the existing Republican administration, which it denounced as "spasmodic, erratic, sensational, spectacular and arbitrary." It also contained a paragraph declaring that the question of the money standard had ceased to be an issue, on the ground that recent discoveries of gold had enormously increased the supply of currency in the country. Bryan did not approve. With characteristic energy he threw himself into an all-night fight in the Committee in behalf of a silver plank. His defeat indicated that the convention was in the hands of his opponents and the platform as adopted contained no reference to the currency.

The delegates had, in fact, come to the meeting with the distinct purpose of returning to the "safe and sane" democracy of Grover Cleveland. To that end, the platform was to drop the silver issue and Bryan was to be replaced by a more conservative leader. The radical forces centered their strength upon William R. Hearst, but they were in a distinct minority, and in the end, the Cleveland wing succeeded in nominating Judge Alton B. Parker of New York. As soon as he was notified of his nomination, Judge Parker telegraphed to the convention that he regarded the gold standard as irrevocably established and that he must decline to be the party candidate if his attitude on the currency was unsatisfactory to the delegates. Thereupon the convention replied that the platform was silent on the question of a monetary standard because it was not regarded as a campaign issue. Parker was satisfied with the reply, and the last word was written upon a question that had disturbed politics for many years.

The succeeding campaign was unusually listless. Parker did not inspire enthusiasm, although a man of undoubted integrity and ability, and the personality of Roosevelt was the controlling force. Only at the close of the canvass did a passing interest appear in some charges made by Parker. He called attention to the fact that Secretary Cortelyou of the Department of Commerce and Labor had been charged with the duty of examining the acts of corporations and had then resigned to become chairman of the National Republican Committee. Parker insinuated that Cortelyou was using information about corporate misdoing, which he had discovered, in order to force large contributions from the business interests. He also declared that the Republican campaign was being financed by the corporations. Roosevelt did not answer the charges until three days before the election, and then he asserted that the statements made by Parker were "unqualifiedly and atrociously false." Later investigations have shown that in general Parker was correct in his complaint as to the activities of the corporations, although he would have found difficulty in proving his charges in detail. The same investigations, however, indicated that some of the Democratic campaign fund had come from similar sources.



The election resulted in the choice of President Roosevelt, whose popular vote was 7,600,000 to Parker's 5,000,000. In the more populous sections of the country, which were normally Republican, the party vote scarcely exceeded that of 1900, but in the Far West, the increases were notable. Beyond the Mississippi River, except in the southern states, hardly a county gave a majority for Parker, showing that the region which had gone to Bryan in 1896 was substantially solid for Roosevelt. Indeed, the policies to which Roosevelt was committed bore a greater resemblance to the principles of Bryan than to the laissez faire philosophy to which many important Republican leaders adhered. Despite their dissent, however, his victory in the election was so overwhelming that he could carry out his program with the irresistible pressure of public opinion behind him.

During the campaign year, the Commissioner of Corporations was busy investigating the activities of the so-called "beef-trust," and a suit against the combination was pressed to a successful conclusion in January, 1905. In its decision in the case (Swift & Company v. United States), the Supreme Court dwelt at some length on the charges made against the Company. A dominant proportion—six-tenths—of the dealers in fresh meat in the United States were alleged to have agreed not to bid against one another in the live-stock markets; to restrict the output of meat in order to raise prices; to keep a black-list; and to get illegal rates from the railroads to the exclusion of competitors. To the objection of the members of the trust that the charges against them were general and did not set forth any specific facts, the Court retorted that the scheme alleged was so vast as to present a new problem in pleading. The decision was against the combination, which was ordered to dissolve. The publicity given to the case and to the methods of the meat packers assisted in the passage of legislation requiring government inspection of meats.

An unexpected phase of the Sherman act appeared in 1908, in the case Loewe v. Lawlor. The American Federation of Labor, acting through its official organ, had declared a boycott against D.E. Loewe, a hat manufacturer of Danbury, Connecticut. The Court decided that a combination of labor organizations designed to boycott a dealer's goods was a combination in restraint of trade and that the manufacturer might maintain an action against the Hatters' Union for damages.[5]

In the meantime, another prominent trust had played into the hands of the administration. The American Sugar Refining Company imported large amounts of raw sugar, on which it paid tariff duties. In November, 1907, it was discovered that the Company had tampered with the scales on which the incoming sugar was weighed, in such a manner as to defraud the government. In the resulting legal actions, over $4,000,000 were recovered from the Company, criminal prosecutions were carried on against the officials and employees, and several of them were convicted. The close relation between the railroads and the great corporations was indicated when the Standard Oil Company of Indiana was brought into court on the charge of receiving rebates on petroleum shipped over the Chicago and Alton Railroad. The decision by Judge K.M. Landis was that the Company was guilty on 1,462 separate counts and must pay a fine of $29,240,000. On appeal to a higher court the case was dismissed, partly on a question concerning the meaning of the law.

The efforts of Roosevelt in the direction of control of the railroads resembled his activities in relation to industrial combinations. A variety of circumstances had combined to arouse a popular demand for the reinforcement of existing legislation: the discovery of grave abuses in connection with the transportation of petroleum; the continuance of favoritism and rebating, together with increasing public knowledge of their existence; the rise in freight rates; and the consolidation of the railroads into a few large systems, with the accompanying concentration of power in the hands of a small number of persons. In his public speeches and in his messages to Congress in 1904 and 1905, President Roosevelt made himself the spokesman of the popular will. In particular—and it was here that the conflict was destined to rage—the President called for the transfer to the Interstate Commerce Commission of the power to determine the rates which the roads should be allowed to charge. The project was not a new one, having already taken shape in previous years, but at no time was Congress prepared to pass definite legislation. The reaction of the railroads to the rising demand was energetic. A costly propaganda was entered upon designed to prove to the public that the roads should be let alone. A powerful lobby worked insistently upon Congress, first to prevent action and later, when action was seen to be inevitable, to weaken the legislation wherever possible. The railroad's campaign of popular education, however, helped to convince the popular mind that new laws were needed, and came coincidently with the disclosures of corporate mismanagement and wrong-doing. The outcome was the Hepburn Act of June 29, 1906.

Its major provisions were five in number. It enlarged the scope of the Interstate Commerce Act so as to include control of express and sleeping car companies, pipe lines, switches, spur tracks and terminals. Free passes, which had hitherto been productive of much favoritism and the source of political corruption, were strictly forbidden, except to a few specified classes. The "commodity clause" forbade railroads to carry goods, other than timber, in which they had an interest, except such as they were going to use themselves. This provision was designed mainly to check the activities of those companies which owned both coal mines and railroads, and which used their advantageous position to crush independent operators. Its force, however, was largely nullified by subsequent decisions of the courts. The Hepburn law also enabled the Commission to prescribe the methods of book-keeping which the roads must follow, to call for monthly or special reports and to employ examiners who should have access to the books of the carriers. The roads were even denied the right to keep any records except those approved by the Commission. These drastic features of the law were due in part to the practices of certain roads which hid away corrupt expenditures in their accounts in such a manner that detection was almost impossible. Most important, however, among the provisions of the Act was that in relation to rate-making, which not only empowered the Commission to hear complaints that rates were unjust or unreasonable, but even enabled it to determine what would be a just and reasonable charge in the case, and to order the carrier complained of to adhere to the new rate. The rate-making section of the Hepburn Act immediately resulted in a large increase in the number of complaints entered by shippers against the carriers. Previously, few cases had been taken to the Commission—only 878 in eighteen years—because relief was seldom obtained and then only at great cost in time and money. Under the new law more than 1500 cases were entered within two and a half years, and several thousand others were informally settled out of court.

The example of the federal government in adopting restrictive railway legislation was followed by the states, on a nation-wide scale. Hours of labor were regulated, liability for accidents defined, railroad commissions given larger powers, and freight and passenger rates determined. The result was a tangle of local regulations, many of which were designed to embarrass the roads and others of which were passed with slight knowledge of the practical questions involved.

Aside from his connection with the anti-trust campaign and the movement for railroad regulation, Roosevelt's most significant activities during his second administration related to conservation. As early as 1880 the Superintendent of the Census had called attention to the exhaustion of the best public lands. The truth of his assertion had been exemplified in the rush of settlers to Oklahoma when the former Indian Territory was opened to settlement on April 22, 1889. At noon on that day the blast of a cavalry bugle was the signal that any settler might enter and stake out his claim. On foot, on fleet horses, in primitive wagons, an excited, jostling mob rushed toward those lands that seemed most desirable. Trains were crowded to the roofs; tools, furniture, and portable houses were carried in from Texas, Nebraska and Kansas. By nightfall a stretch of waving prairie became Gruthrie, with a population of 10,000 persons; by the evening of the first day Oklahoma possessed a population of 50,000; twenty years later it had over a million and a half, contained flourishing cities, many public enterprises, and a beautiful state university.

The fact that desirable land was becoming so rare called attention to the waste and dishonesty in connection with our public land system. In his annual report for 1884 the Secretary of the Interior had complained that large amounts of land had been acquired under fictitious names or by persons employed for the purpose. Their holdings were then passed over to speculators who retained huge areas for a rising market. Railroads had kept lands granted to them, without fulfilling the conditions of the grants. Titled Englishmen and English land companies had gained control of tracts of unbelievable size, one of them being estimated at 3,000,000 acres. The history of the disposal of the public land had almost been duplicated in the history of the forest-bearing public domain, except that measures had earlier been taken to conserve the remnant of the once magnificent supply of standing timber. An act of 1891 had enabled the president to set apart as public reservations any lands bearing forests. All the presidents, from Harrison down, had availed themselves of their power, and had established great numbers of reservations, most of them in states west of the Mississippi.[6]

A few far-sighted individuals had long urged caution in the disposal of the public resources. Some beginnings in fact had already been made in the Division of Forestry in the Department of Agriculture, where Clifford Pinchot was actively interested in forest preservation. In 1901 and later his functions had been expanded, and the forestry service had taken up protection against fire, the sale of timber, and reforestation. In 1907 President Roosevelt appointed a commission to study the inland waterways, which after careful investigation recommended a convention for the discussion of conservation problems. Thereupon the President invited the governors of the states to Washington for a conference, at which conservation questions were thoroughly discussed. The resulting recommendations composed a complete, although general plan of reform: the natural resources of the country to be used for the prosperity of the American people; reclamation of arid lands; conservation of forests, minerals and water-power; the protection of the sources of the rivers; and cooperation between Congress and the states in developing a conservation program. A National Conservation Commission was later appointed which coordinated the work of organizing the movement, and made an exhaustive inventory of the nation's natural resources.

The conservation movement also called attention to the possibilities of the arid region between the western parts of Kansas, Nebraska and the Dakotas, and the eastern border of California. Within this vast area were large tracts of land that would be fertile if sufficiently supplied with water. The most important legislation in a series of acts designed to meet this need was the Reclamation Act of 1902. Under its provisions the federal government set aside the proceeds of the sale of public land in sixteen states and territories as a fund for irrigation work. With the resources thus obtained, water powers were developed, reservoirs built and large tracts supplied with water. Private companies and western states also carried out numerous projects. The Department of Agriculture after its establishment in 1889 also conducted many undertakings which, in effect, were conservation enterprises. It helped educate the American farmer in scientific methods, sought new crops in every corner of the globe, discovered and circulated means of combating diseases and insects, studied soils, distributed seeds and gathered statistics. In the arid and semi-arid regions the discovery of dry farming was of great value. This consists of planting the seed deep and keeping a mulch of dust on the surface by frequent cultivation, in order to retard the evaporation of the moisture in the ground underneath.[7]

Nothing can be more apparent than the complete change of position which was brought about during the eight years after the death of President McKinley. At the end of that period, both the industrial corporations and the railways were on the defensive, and the public had secured the whip hand. Industry, especially the railroads, was tamed and hobbled—some thought, crippled. Many factors contributed to the revolution. President Roosevelt was its most active agent, to be sure,—its "gigantic advertiser" and popularizer. But it could hardly have taken place—at least at the time and in the way it did—without the great upheaval of 1896, without the publicity which the "muck-rake" magazines and daily newspapers were able to offer, without the industrial consolidations of 1898 and later, and without the refusal of industry and the railways to obey earlier and less drastic laws, and their skilled and insistent attempts to find loop-holes in legislation.

From the standpoint of politics, the effect of the Roosevelt administrations was notable. As has been seen, the Republican party had become largely the party of the business and commercial classes, conservative and unyielding to the new demands of the late nineteenth century. Its leadership had been sharply challenged by the forces of unrest in 1896. On an issue other than a monetary one, the success of Bryan would have been possible. The failure of the attempt to get control of the federal government in the interest of the Populist program was only a temporary defeat, for the revival of unrest, although checked by the war with Spain, was sure soon to reappear. In President Roosevelt, the forces of discontent, especially in the Middle and Far West, saw their hoped-for champion, and their support of him was instant and complete. The dominant leadership and much of the rank and file of the Republican party had become liberal. The situation was anomalous, however, for no great political party can experience a thorough-going change of philosophy in a few years. Only the future, therefore, could tell whether the newer and more liberal element would continue to control the party, or whether a reaction against its leadership would take place.

BIBLIOGRAPHICAL NOTE

It is too early to expect a biography of Roosevelt which is informed and critical, as well as sympathetic. The keenest judgment is to be found in Atlantic Monthly (CIX, 577), "Mr. Roosevelt." The following are also available: L.F. Abbott, Impressions of Theodore Roosevelt (1919); F.E. Leupp, The Man Roosevelt (1904); W.R. Thayer, Theodore Roosevelt (1919); C.G. Washburn, Theodore Roosevelt; the Logic of His Career (1916). Roosevelt can be partly understood through a critical reading of his writings, especially his Addresses and Presidential Messages (1904), and his Autobiography (1913).

On the coal strike consult the Autobiography, and Senate Reports, 58th Congress, special session, Document No. 6 (Serial Number 4556), the report of the President's Commission. The election of 1904 is discussed in Latane, Croly and Stanwood: see also C.M. Pepper, The Life and Times of Henry Gassaway Davis (1920). The new railroad acts are well discussed in W.Z. Ripley, Railroads: Rates and Regulations (1912), and by F.H. Dixon in Quarterly Journal of Economics, XXI, 22.

The literature of conservation is very large. An excellent single chapter is in Katherine Coman, Industrial History of the United States (rev. ed., 1910); C.R. Van Hise, The Conservation of Natural Resources in the United States (1913), is a standard work; R.P. Teele, Irrigation in the United States (1915), is detailed; for documents concerning the conference of governors, House of Representatives Document No. 1425, 60th Congress, 2nd session (Serial Number 5538).