The Master Rogue: The Confessions of a Croesus

by David Graham Phillips

I could not break my rule. Yet I must properly marry my children and must keep my promise to my university; and to have left twelve millions of capital idle would have been to show myself unworthy of the responsibilities of great wealth. I was thus literally driven to one of those large public services which are so venomously criticised by the small and the envious. Every action of no matter what kind produces both good and bad consequences. To wait until one could act without any unfortunate results to anybody would be to sit motionless, even to refrain from eating. The most that conscience demands is that one shall do only those things which in his best judgment will show a balance on the side of good.

I had long had my eye on certain mines and appendant manufactories situated at several points on two of my three lines of railway. They were doing well enough in a small way; but I knew that, combined under the direction of such a brain as mine, they would become immensely more profitable. I now saw no alternative to taking them and making them as valuable and as useful as they were clearly intended to be. In preparation for the coup I withdrew from the directory of my third railway, substituting one of my unrecognised agents, himself a millionaire in a small way; and I put my stock in the names of others of my agents and did not deny the report that I had ceased to have any financial interest in the road. Thus I was in a position to alter its freight rates without the change being traced to me by those prying meddlers who are so active in their interference in other people’s business nowadays. When it was universally believed that I no longer had any connection with my third road, and that it had passed to a control hostile to me, I ordered it to give large secret rebates upon all freight of the kind I wished to affect.

The result was that the owners of those mines and factories, being compelled to ship by my two other railways, which stiffly maintained rates, were no longer able to compete. Their competitors, shipping by my third line, easily undersold them with the assistance of the secret rebate. They came in a stew and sweat to my two presidents and said that secret rebates by the third line were the cause of their impending ruin. My two presidents agreed with them and opened a fierce war of words upon my third president—him whom they and every one else thought hostile to me. He retorted with a sweeping denial of their charges. “It is nothing new in a world of self-excuse,” said he, “for incompetent business men to attribute their misfortunes to the wickedness of others instead of to the real source—their own incapacity and incompetence.” And so the sham battle raged by mail and newspaper interview. But—the mine and factory owners I was gunning for got nothing tangible out of it. Their competitors continued to undersell them; their business rapidly languished.

When I saw that they were in a sufficiently humble frame of mind I came to their relief. I sent word to them that, as I had a warm personal feeling for the towns dependent upon the prosperity of their works, I would take a hand in their languishing businesses if they wished and would do my utmost to maintain the apparently hopeless battle.

My offer was received with enthusiastic gratitude—as it should have been; for, while it is true that I had precipitated the crisis which their antiquated methods of doing business would have inevitably brought sooner or later, is it not also true that I have the right to do what I wish with my own? And are not those two railways, and the third, as well, my own? But for the present rampant spirit of contemptuous disregard for the rights of private property and the impudent intrusions into private business it would not have been necessary for me to disguise myself and act like a housebreaker in order to exercise my plain rights—yes, and do my plain duty; for can there be any question in any judicial mind that it is the duty of men of the commercial and financial genius which I possess to use it to bring the resources of the country to their highest efficiency?

After some negotiations I got control of the properties that I needed and that needed me. I agreed to pay altogether fifteen millions for a controlling share in them—about half what it would have cost me before I brought my rebate artillery to bear, but about twice what control would have cost had I battered away for six months longer. I might have accomplished my purpose much more cheaply; but I am not a hard man, and I do not flatter myself when I say that conscience is the dominant factor in all my operations. I felt that in the circumstances the owners were entitled to consideration and that to make my victory complete would be an abuse of power. It is hardly necessary to add that my generosity had its prudent side, as has all rational generosity. To have assailed the properties too long in order to get them cheap would have permanently impaired their value; to have wiped out the owners utterly would have caused a profound, possibly dangerous, public resentment against my class, too many members of which had been guilty of the grave blunder of using their power without regard to public opinion. But while prudence was a factor in my general settlement, the main factor was, as I have said, conscience. Not the narrow conscientiousness of ordinary men, which is three parts ignorance, two parts cowardice, and five parts envy—for is it not usually roused only when the acts of others are to be judged?

When my offer was accepted I organised a combination to take over the properties, and I paid for them with its guaranteed bonds and preferred stock. Then I countermanded the order for a heavy secret rebate against their products and, instead, issued an order for a small secret rebate in their favour—letting the public think I had by some secret audacious move regained control of my third railroad. The combination’s business boomed, its stock went up, and all that it was necessary for me to sell was eagerly bought. What with the bonds and the stocks I sold, I had gained control without its having cost me a penny. It is not vanity, is it, when I call that genius?

But control is not possession, and these properties are worth possessing. I must possess them. It is not just that so large a part of the profits of my labour—of my act of creation—should go to others.

I have anticipated somewhat. The operation took a considerable time, but not long in view of the great results. When one has my vast resources and my peculiar talents, men and events move, obstacles are blown up, roads are thrust swift and straight through the thickest tangles, and the objective is reached before feeble folk have got beyond the stage of debate and diplomacy. Still, nearly a year elapsed between the start and the finish, and many things happened which were the reverse of satisfactory—most of them, as usual, in my domestic affairs.

I had got the enterprise only fairly under way when the invitations for Walter’s wedding were issued. Natalie’s father had seen me several times and had shown his determination to intervene in the matter of her dowry by bringing up the subject at our business conferences whenever he could force the smallest opening. Like all my associates, from capitalist to clerk, he is in awe of me. I see to it that in the velvet glove there shall always be holes through which the iron hand can be plainly seen. That often saves me the exertion of using it. An iron hand, once it has an established reputation, is mightier when merely seen than when felt. He would always begin by some vague, halting reference to my promised generosity.