In popular education, in initiation of new administrative policies, and in the passage of constructive laws efforts were being made to adjust government to the needs of modern industry and to safeguard society. The business interests affected by the changes obstructed the process when they could, and were intensified in their opposition by the series of prosecutions brought by Attorney-General Knox, and his successor Charles J. Bonaparte, under the Sherman Law. At no time in the earlier history of this law had there been a strong disposition to test its merit, and no one of the notorious trusts had been attacked before the Northern Securities case. In later years it was turned against the Standard Oil Company, the beef-packers, the Tobacco Trust, the Sugar Trust, and the United States Steel Corporation, while railways and smaller corporations, in great number, were prosecuted. The enforcement of the law aroused blind opposition among many of the victims, and stimulated queries as to whether or not any attempt to limit the size of business was sound public policy. The debate upon regulation, as against prohibition of trusts and monopolies, ran on with no sign of victory for either side of the argument. Personal hostility against the Administration for applying the law gave color to the last two years of Roosevelt's Administration.
By 1907 there had been ten years of the prosperity that had begun with the election of McKinley. Finance had developed with industry and trade. The needs of corporations dealing in millions and hundreds of millions of capital had induced the consolidation of banks and the concentration of financial power in the hands of a small group of men. The holding companies were great aids in the furtherance of this concentration. J. Pierpont Morgan and John D. Rockefeller were best known as representative of the inner circle. Their speculations and investments were embarrassed by the weakening of public confidence. It was certain there would come a time when the whole surplus capital of the United States would be invested in permanent improvements. Such periods had followed eras of boom in 1837, 1857, and 1873. It was too probable that some accident occurring in the period of liquidation would create a panic. Suspicion had been directed against the controlling agents of business by the revelations of 1902-07. It was exaggerated by sensational journalism. It reached a climax in the fall of 1907 when a group of banks, reputed strong, failed through dishonesty and speculative management. The failure of the Mercantile National Bank and the suspension of the Knickerbocker Trust Company in New York brought the crisis on October 22, 1907. The loss to the public was lessened by resolute and sympathetic coöperation among the clearing-houses, Morgan, Rockefeller, and the United States Treasury, but a period of enforced economy was begun for all.
The managers of big business attributed the panic to "Theodore the Meddler." They claimed that business was sound and honest, and the upheaval was caused by the agitation of demagogues. The President, they asserted, had destroyed confidence by his attack on the commercial class. Federal prosecutions, new laws, and the enforcement of inquisitorial pure-food regulations had made it impossible for business to live. "Let us alone," they cried.
They convinced only themselves, a small minority of the people of the United States. Since 1902 the people as a body, regardless of the great parties, had opened their eyes to the trend of business and had decided that public authority must be summoned to the defense of democracy. The independent vote broke away from each party in increasingly numerous cases. The old American view that democracy meant unrestrained individualism had given way to the newer view that democratic opportunity was dependent upon the restriction of monopoly. The ostensible leaders, from the President down, were only the mouths that spoke the new language. Without them the same condition would have existed in large degree. The attack of the financial interests and Wall Street upon the President only convinced the people that the Roosevelt policies were, on the whole, their policies, and that individual interest and party machinery must give way to their attainment.
BIBLIOGRAPHICAL NOTE
The periodicals and special articles alluded to in this chapter constitute the best sources as yet available for the period. There were numerous investigations by committees of Congress that furnished facts in their reports. Certain of the departments of government, notably the Bureau of Corporations and the Department of Agriculture, were active in the publication of facts. Thoughtful surveys of society in the United States may be found in E.A. Ross, Changing America (1912); H. Croly, The Promise of American Life (1909); A.B. Hart, National Ideals Historically Traced (in The American Nation, vol. 26, 1907). The autobiography of R.M. LaFollette is of considerable value. A great number of books upon America by foreign visitors bring out special viewpoints. Among these are F. Klein, In the Land of the Strenuous Life (1905); A. Bennett, Your United States (1912); W. Archer, America To-Day (1899); Anon., As a Chinaman Saw Us (1904); and James Bryce has revised and brought down to date his American Commonwealth.
CHAPTER XX
The process of adjusting national administration and laws, to meet the needs of life and business that knew no state lines, had been begun during the Roosevelt period. For its completion it was necessary that a successor be found, convinced of the Roosevelt policies and able to carry them out. Three Republicans of this type were often mentioned for the Presidency in 1908. Elihu Root had been the legal mainstay of three administrations, and had received the public commendation of Roosevelt often and without restraint. His availability for the elective office was, however, weakened by his prominence as a corporation lawyer, which would be urged against him in a campaign. William H. Taft, Secretary of War, had a wider popularity than Root; had, as federal judge, long been identified with the enforcement of law, and had been used repeatedly as the spokesman of the President. He knew the colonies as no other American knew them, and was in touch with every detail of the Panama Canal. Neither he nor Root had won a leadership in competitive politics as had the third candidate, Charles E. Hughes, who, as Governor of New York, had shown his capacity to fight professional politicians on their own ground.