Wealth against commonwealth

by Henry Demarest Lloyd

The reports of the United States consul-general at Berlin, in 1891, transmitted many interesting articles from the German papers concerning the alliance which it was believed had been made between the Rothschilds and the American oil combination. A company managed by the great bankers has obtained a commanding position in the Russian oil business, and the American and the Russian were even then said to have divided the world between them. The Berlin Vossische Zeitung said: "Heretofore the two petroleum speculators have marched apart, in order to get into their hands the two largest petroleum districts in the world. After this has been accomplished they unite to fight in unison, and to fix as they please the selling price for the whole world, which they divide between themselves. So an international speculating ring stands before the door, such as in like might and capital power has never before existed, and everywhere the intelligible fear prevails that within a short time the price of an article of use indispensable to all classes of people will rise with a bound, without its being possible for national legislation or control to raise any obstacles."[643]

But some of the closest European observers have seen reasons from the beginning to believe that the Rothschilds are in the Russian oil business only as the agents of the American combination. This is freely asserted by the Continental press. The policy of the Rothschilds has been never to engage in commercial enterprise on their own account. The tactics used by the Rothschilds in oil have been an almost exact reproduction of those of the combination in America. From the first they gave the subject of freights their special attention. They showed no ability for new or independent undertakings, but they tried, to use the words of an Austrian-Hungarian consular report from Batoum in 1889, "following the example of the combination in the United States, to get the bulk of the Russian petroleum trade into their hands"; using the large money power at their command for speculation, freely advancing money for leases and delivery contracts, and specially acquiring all the available means of transportation. The experience of the people of Parker[644] is recalled by the statement that the Rothschild company would leave hundreds of cars loaded with petroleum on the tracks for weeks to prevent competitors from shipping and from filling their contracts. When the city of Batoum, in 1888, refused to allow it to lay pipes over the city lands to the harbor, it was with the enthusiastic approbation of the agitated citizens. The authorities gave as their reason that through large establishments of this kind the capitalists gained a monopoly, crushing out smaller producers to the disadvantage of all classes of the population. In the absence of official investigations, a free press, and civilized courts—that knowledge which is not only power but freedom—it is impossible for any one in Russia, or out of it, to know the truth as to the relations of the Rothschilds to the American monopoly. The latest news in the summer of 1894 is of a great combination of Russian and American oil interests, under the direction of the Russian Minister of Finance, for a division of territory, regulation of prices, and the like. Information of this was given to the world by that minister's official organ in November, 1893. Thus says the Hanover (Germany) Courier of November 11th: "With the direct sanction of the Russian government the management of the enormous wealth that lies in the yearly production of Russian petroleum will be concentrated in the hands of a few firms.... The Russian government lends its hand for the formation of a trust that reaches over the ocean—a trust, under State protection, against the large mass of consumers. This is the newest acquisition of our departing century."

It was announced that, in pursuance of this plan, the Russians were to be given exclusive control of certain Asiatic markets. The officers of the American combination are not easily reached by newspaper men. But when this news came long interviews with them were circulated in the press of the leading cities, dwelling upon the "Waterloo" defeat they had suffered, and reassuring the people with this evidence that there was, after all, "no monopoly." The Russian interests are dominated by the Rothschilds, and if the Rothschilds are, as these European observers declare, merely the agents of the Americans, even unsophisticated people can understand the cheerfulness with which the trustees in New York dilate on their Waterloo at the hands of their other self. Only this could make credible the report that the world has been divided with the Russians by our American "trustees," who never divide with anybody. In dividing with the Russians they are dividing with themselves.

Though it is reported that discriminations by the government railroads of Russia were used to force the Russian producers into this international trust, still, at worst, every Russian producer was given by his government the right to enter the pool. But no similar right for the American producer is recognized by our trust. It admits only its own members. The others must "sell or squeeze." There is something in the world more cruel than Russian despotism—American "private enterprise."

One of the conditions said to have been made by the Russian government is the natural one that the American trust, as it has agreed to do for the French, must protect its Russian allies from any competition from America. Extinction of the "independents" has therefore become more important than ever to the trust. The prize of victory over them is not only supremacy in this country, but on four other continents. This will explain the new zeal with which the suppression of the last vestige of American independence in this industry has been sought the last few months of 1893 and in 1894. Especially strenuous has been the renewal of the attack on the pipe line the independents are seeking to lay to tide-water, and which they have carried as far as Wilkes-barre.[645]

That pipe line, as it is the last hope of the people, is the greatest menace to the monopoly. The independents, as they have shown by the fact of surviving, although they have to pay extraordinary freights and other charges from which the trust is free, can produce more cheaply than the would-be Lords of Industry, as free men always do.[646] By means of this pipe line, suspended though it is at Wilkes-barre, are now made the only independent exports of oil that go from America to Europe. Once let the "outsiders" with their line reach the sea-shore and its open roads to the coast of America and Europe, and it will be a long chase they will give their pursuers. Everything that can be brought to bear by market manipulation, litigation, and other means is now being done to prevent the extension of this line, and to bankrupt the men who are building it through much tribulation. The mechanical fixation of values, by which the refiners who use this line to export oil are compelled to meet a lower price for the refined in New York than can be got for the crude out of which it is made, has been already referred to, and, as shown above, the same prestidigitation of prices is being resorted to in Europe against the independents of Germany.

Early in 1894 the independent refiners and producers resolved to consolidate with this pipe line some other lines owned by them in order to strengthen and perfect the system, and put it in better shape to be extended to tide-water. This consolidation was voted by a large majority both of stock and stockholders. But a formidable opposition to it was at once begun in the courts by injunction proceedings in behalf of one man, a subordinate stockholder in a corporation of which the control is owned, as he admitted in court, by members of the oil trust.[647] The real litigant behind him, the independents stated to the court, was the same that we have seen appear in almost every chapter of our story, with its brigades of lawyers. "An unlawful organization," the independents described it to the court, "exercising great and illegal powers, ... and bitterly and vindictively hostile to our business interests." They came into court one after the other and described the ruin which had been wrought among them, telling the story the reader has found in these pages.

"It is our hope," they said, "when we once reach the salt-water that there will be no power there controlling the winds and the waves, the tides and the sun and moon, except the Power that controls everything. When we once are there the same forces that guide the ships of this monopoly to the farther shore will guide ours. The same winds that waft them will waft ours. There is freedom, there is hope, and there is the only chance of relief to this country.... Through three years of suffering and agony we have attempted to carry on our purpose.... You could have seen the blood-marks in the snow of the blood of the people who are working out their subscription as daily laborers on that line with nothing else to offer."

The injunctions asked for by this opposition were granted by the lower court, but the independents took an appeal to the Supreme Court of Pennsylvania. They first placed their petition for the rehearing in the hands of the chief-justice on Thursday, May 24th; on Monday, May 28th, the petition was renewed before the full court; on Thursday, May 31st, the court adjourned for the summer without taking any action upon the petition. The court in July agreed to hear the case at the opening of its next term, the first Monday of October. Section II. of Article I. of the Constitution of Pennsylvania says: "All courts shall be open, and every man, for an injury done him in his lands, goods, person, or reputation, shall have remedy by due course of law, and right and justice administered, without sale, denial, or delay." To guard against the injustice which might arise by the granting of special injunctions by the lower courts—like that granted in this case—which might remain for months without remedy, the Legislature, in 1866, enacted a law which reads as follows: "In all cases in equity, in which a special injunction has been or shall be granted by any Court of Common Pleas, an appeal to the Supreme Court for the proper district shall be allowed, and all such appeals shall be heard by the Supreme Court in any district in which it may be in session."

As if there had not been enough to try these men, misfortune marked them in other ways. The Bradford refinery of the president of their pipe line was visited by a destructive fire during these proceedings in court. The Associated Press despatches attributed the fire to "spontaneous combustion," whatever that may be. But in another newspaper an eye-witness described how he saw a man running about the works in a mysterious way just before the flames broke out. On the same day, by a coincidence, the main pipe of the independent line was cut, and the oil, which spouted out to the tree-tops, was set on fire at a point in a valley where the greatest possible damage would result, and the telegraph wires were simultaneously cut, so that prompt repairs or salvage of oil were impossible. The Almighty is said to favor the heaviest battalions, and accident, if there is such a thing, seems to have the same preference, as has been shown in many incidents in our history, such as the mishaps to the Tidewater pipe line, and the Toledo municipal gas line.[648]