Hepplestall's

by Harold Brighouse

But war disintegrates. William was wrong in thinking that he had to pit his tenacity and his sense of duty only against Gertrude. The end of the war and its immediate sequel were to blow a shrewd side-wind upon his resolution to endure.

The great delusion of the war was that its end would be peace. William was encouraged by that delusion to wrestle with the war-problems of his business: the shortage of raw cotton, the leaping costs of production, the shortage of shipping. The home trade was good beyond precedent, it almost seemed that the higher the price the greater the demand; but the home market, at its most voracious, took only a minor part of Hepplestall’s output. Turkey was an enemy; India, China and South America followed warily the upward trend of prices, expecting the end of the war to bring a sudden fall, and, also, were difficult of access by reason of the transport shortage. In spite of the military service act, in spite of their woolen dyeing, and of every device that William and the Board could contrive to keep the great mills active, there was unemployment at Hepplestall’s. Cotton was rationed in Lancashire and Hepplestall’s quota of the common stock was insufficient to keep their spindles at work. The situation was met adequately by the Cotton Control Board and the Unions and by the substitution of corporate spirit for individualism; by high wages; by a pool of fines imposed on those who worked more spindles and took more cotton than their due; and ends were met all round, but, however different the case of the munition trades, cotton was no beneficiary of the war.

The year 1919 brought a great and a dangerous reaction. It was seen by the foreign markets that their expectations of a spectacular fall in prices were not to be realized, and, for a time, buyers scrambled to supply, at any price, cotton goods to countries starved of cotton practically throughout the war. William looked back to his father’s time when the margin of profit on a pound of yarn had been reckoned by an eighth or a farthing: it was now sixpence or more, and he trembled for the cotton trade. Such margins had the febrile unhealthiness of an overheated forcing-house. He hadn’t expected peace to duplicate for him the conditions of 1913, but these profits, current in 1919, expressed for him the hazards of the peace. There was a madness in the very air, and a frenzy of speculation resulted from this rebound of the cotton trade from war-depression to extreme buoyancy. The profits were notorious, and Labor could not be expected to remain without its share of the loot. That was reasonable enough, but William had no faith in the boom’s lasting and knew the difficulty of persuading Labor to accept reduction when the tight times came. Meanwhile, certainly, Labor had a sound case for a large advance in wages, even though wages had steadily risen throughout the war. William wondered if any helmsman of Hepple-stall’s had ever faced such anxious times as these; the very appearance of prosperity, deceptive and fleeting as he held it to be, was incalculable menace. In spite of himself, he was a profiteer—not a war, but an as-a-result-of-the-war profiteer—and both hated and feared it. This was not peace but pyrotechny; they were up like a rocket and he feared to come down like the stick.

Lancashire was turned into a speculator’s cockpit and cotton mill shares were changing hands sometimes at ten times their nominal value. The point, especially, was the prohibitive cost of building, so that existing mills had monopoly valuations. The general anticipation, which William did not share, was that a world hunger for cotton goods would sustain the boom for four or five years; there was plenty of war-made wealth ready for investment, and the cotton trade appeared a promising field for high and quick returns.

So much money was there and so attractive did cotton trade prospects appear that the local speculator began to be outbidden very greatly to his patriotic annoyance. The annoyance, indeed, was more than patriotic or parochial, it was sensible. A highly technical trade can be run to advantage only when its controllers have not only full technical knowledge, but full knowledge of local characteristics and prejudices, and Lancashire was, historically, self-supporting with its finance as well as its trade under Lancashire direction. From its brutal origins to its present comparatively humane organization, its struggles and its achievements had been its own.

The interests of the financier are financial; one-eyed, short-sighted, parasitic interests. Steam and the factory system fell like a blight on Lancashire, but they had in them the elements of progress of a kind; they worked out, outrageously, in the course of a century to a balance where the power was not exclusively the employers’. The object of the London financiers who now perceived in Lancashire a fruitful field was to buy up mills, run them under managers for the first years of the boom, then, before new mills could be built, to show amazing profits and to unload on the guileless public before the boom collapsed. It was a raid purely in financial interests and opposed to the permanent interests of Lancashire, which would be left to bear, in a new era of distress, the burdens imposed by over-capitalization. To the financier, Lancashire was a counter in whose future he had no interest after he had floated his companies and got out with his profits. And he collected mills like so many tricks in his game.

The owners were fraudulent trustees to sell even under temptation of such prices as were offered? Well, many did not sell, and for others there was the excuse, besides natural greed, of war-weariness. They had the feeling that here was security offered them, ease after years of strain; it was a sauve qui peut and the devil take the hindmost. They were men who hadn’t been in business for their health and were offered golden opportunity to retire from business. They had been, perhaps, a little jealous of others who had made strictly war wealth, and this was their chance to get hold, at second hand, of a share of those war profits. There was the example of others... there would be stressful times ahead for the cotton trade... Labor upheavals... it was good to be out of it all, with one’s money gently in the Funds.

And Finance goes stealthily to work: it was not at first apparent, even to sellers, that behind the nominal buyers were non-Lancashire financiers. There was no immediate apprehension of the objects; nobody took quick alarm. Labor, especially the Oldham spinners, had cotton shares to sell and took a profit with the rest. They started a special share exchange in Oldham: it was open through the Christmas holidays and on New Year’s Day of 1920. That speaks more than volumes for the dementia of that boom. Working on New Year’s Day in Oldham! What was the use of being sentimentally annoyed at being outbidden by a Londoner, even if you perceived he was a Londoner, when the congenital idiot offered ten pounds for a pound share on which you had only paid up five shillings?

Appetite grew by what it fed on and Finance ceased to be satisfied with acquiring small mills whose names, at any rate, were unknown to the outside investor. Hepplestall’s was different, Hepplestall’s was known to every shopkeeper and every housewife in the land. It was, in the opinion of Finance, only a question of price; and prices did not cow Finance.

William sat in the office of the Hepplestalls with a letter before him which was Finance’s opening gambit in the game. It was addressed to him personally, marked “private and confidential,” by a London firm of chartered accountants whose national eminence left no doubt of the serious intentions of their clients.