v
In September the plan was brought out. Though it caused a good deal of dubious comment the verdict of general opinion was ultimately favorable. The security holders liked it because they were not assessed in the ordinary way. They received, instead, the “privilege” so-called of buying new securities.
When all arrangements were completed the assets of the old Great Midwestern Railroad Company, meaning the railroad itself and all its possessions and appurtenances, were put up at auction. Mordecai & Co., acting as trustees, were the only bidders.
They delivered the assets to the new Great Midwestern Railway Company, which had been previously incorporated under the laws of New Jersey. Afterward there was a stockholders’ meeting in Jersey City, in one of those corporation tenements where rooms are hired in rotation by corporations that never live in them but come once a year for an hour or two to transact some formal business and thereby satisfy the fiction of legal residence.
A stockholders’ meeting is itself a fiction. The stockholders are present by proxy. Clerks bring the proxies in suit cases. They are counted and voted in the name of the stockholders under previous instructions. Thus directors are elected. Mordecai & Co. held six tenths of the proxies. Horace Potter, representing himself and the oil crowd whose investment in the old Great Midwestern had been very large, held three tenths. There was no contest; Mordecai & Co. and the oil crowd acted concertedly in all matters. They were allied interests. With one exception the old board was re-elected. The exception was Henry M. Galt, elected in place of a very old man who had been induced by the bankers to withdraw.
In the afternoon of the same day the directors met in the Board Room for the first time since their inglorious exit through Harbinger’s office eleven months before. Valentine was unanimously re-elected president. There was a pause.
“I bropose Mr. Gald vor chairman ov ze board,” lisped Mordecai.
It had all been arranged beforehand. There was no doubt of the outcome. Yet there was an air of constraint about taking the formal step. Evidently in the background there had been a struggle of forces.
Potter said: “Second the nomination.”
The president called for the vote. Four were silent, including Galt. Five voted aye. Valentine nodded his head and the result was recorded: “Chairman of the Board, Henry M. Galt.”
Meanwhile the traffic manager and his three assistants, who had been summoned from Chicago for a conference, were waiting in Harbinger’s office. Galt walked directly there from the Board Room, sat on Harbinger’s desk with his feet in the chair, waived all introductions, and said:
“Now for business. Hereafter all contracts with shippers and all agreements with the traffic managers of other roads will be sent to this office for my approval and signature. They will not be valid otherwise.”
The traffic manager was a florid, contemptuous man who wore costly Chicago clothes and carried a watch in each waistcoat pocket, very far apart. He was one of a ring of traffic managers who waxed fat and arrogant in the exercise of a power that nobody dared or knew how to wrest from them. They sold favors to shippers. They sold railroad stocks for a fall in Wall Street and then got up ruinous rate wars among themselves to make stocks fall. Their ways were predatory, scandalous and uncontrollable. If one railroad tried to discipline its traffic manager the others practiced reprisals and the business of that one railroad would slump; or if a railroad dismissed its traffic manager his successor would be just as bad, or more greedy in fact, having to begin at the beginning to get rich.
At Galt’s speech the traffic manager crossed his legs with amazement, dropped his arms, slid down in his chair, bowed his neck and assumed the look of an incredulous bull, showing the white under his eyes.
“And who the hell are you?” he asked.
“Me?” said Galt. “I’m the driver.”
“We’ll see,” said the traffic manager. He rose, overturning his chair, and made for the door, meaning of course to see the president.
“You’d better wait a minute,” said Galt. “I’m not through yet.”
He waited.
Then Galt, addressing the assistants, outlined a new policy. What they were to work for was through freight, passing from one end of the system to the other. What they were to avoid was anything they wouldn’t like a railroad to do to them. What they were to believe in was a gang spirit. What they were to get immediately was a doubling of their pay.
Getting down on the floor he advanced slowly with a stealthy step at the traffic manager, who began to quail.
“You choose whether to resign or be fired,” said Galt. “The first assistant will take your place.” He added something in a lower tone that no one else could hear, then stood looking at him fixedly. The traffic manager started, mopped the back of his neck, wavered, and stood quite still.
“Well, it’s damned high time,” he said, at last, by way of mentioning a basic fact. With that he sat down and wrote his resignation.
This incident was an omen. Unconsciously Galt worked on the principle that once a thing has happened it cannot unhappen. The fact of its having happened is original and irrevocable. Every other fact in the universe must adjust itself to that one. Something else may happen the next instant; that is a new happening again.
Mr. Valentine was violently agitated by the traffic manager’s dismissal. If he had been consulted he would have made an issue of it. But there it was. It had happened. The fact created a situation. He might refuse to accept the situation, but he could not extinguish the fact. He fumed and let it pass. Nothing was ever the same again.
Galt consulted nobody. He turned from the traffic man to Harbinger and ordered that the pay of the whole executive staff from the secretary down be doubled. Then he put Harbinger out, took the whole of the room for himself, painted the word “Chairman” on the door and thereafter the Great Midwestern was managed from his desk. There was never a moment’s doubt about it. There was no time to debate his authority. It took all of everybody’s time to keep up with what was happening. He recast the operating department by telegraph in one hour, according to a plan already matured in his mind. He changed the accounting system radically, and much to everyone’s surprise, John Harrier accepted the change with enthusiasm.
Having made a flying trip over the road he sent a telegram ahead of him calling a special meeting of the board of directors. It convened at ten o’clock. Galt came directly from the train, stained, unshaven and a little weary, until he began to talk.
What he proposed was that fifty million dollars be raised at once and spent for new engines, cars, rails and road improvements. Mordecai alone was prepared for this. All the others were daft with astonishment. A railroad only a few days out of bankruptcy to find and spend that sum for improvements! It was preposterous. Not only was the whole board against him, save Mordecai; it was hostile and struck with foreboding. As Galt rose to make his argument I remembered what he had twice said: “I shall be one of ten men in a Board Room. Everything else follows from that.”