Wealth against commonwealth

by Henry Demarest Lloyd

The United States Senate Committee which investigated the cattle and meat monopolies had a similar experience. Their report says: "The secretary of the Union Stockyards testified at Chicago that when the company was established the stock was subscribed by the railroads; but when asked to show his stock-books he declined, after consultation with the company's attorneys, and persisted in this refusal at Washington City. For the purposes of our investigation it was not considered necessary to ascertain in whose names the stock now stands, for we were satisfied that whatever the ownership it would not appear in the names of the railroad presidents, directors, and stockholders, who are the real owners.... The refusal of the secretary, under direction of his employers, to make public the list of stockholders must have been because of the fact that the same men own the stockyards and the railroads running to them, and they do not propose to submit their books to scrutiny because they dread the truth.... This extraordinary conduct on the part of the stockyards company is not alone in the chain of evidence which shows complicity between the stockyards and the railroads."[763]

The smokeless rebate makes the secret of success in business to be not manufacture, but manufracture—breaking down with a strong hand the true makers of things. To those who can get the rebate it makes no difference who does the digging, building, mining, making, producing the million forms of the wealth they covet for themselves. They need only get control of the roads. All that they want of the wealth of others can be switched off the highways into their hands. To succeed, ambitious men must make themselves refiners of freight rates, distillers of discriminations, owners, not of lands, mines, and forests—not in the first place, at least—but of the railway officials through whose hands the produce must go to market; builders, not of manufactories, but of privileges; inventors only of schemes to keep for themselves the middle of the road and both sides of it; contrivers, not of competition, but of ways to tax the property of their competitors into their pockets. They need not make money; they can take it from those who have made it.

In the United States the processes of business feudalization are moving more rapidly to the end than in any other country. In Chicago, the youngest of the great cities of the youngest of the great nations, there are fewer wholesale dry-goods stores in 1894 for a population of 1,600,000 than there were in 1860 for 112,172. In almost every one of the meteoric careers by which a few men in each trade are rising to supreme wealth, it will generally be found that to some privilege on the railed highways, accomplished by the rebate, is due the part of their rise which is extraordinary. A few cases of great wealth from the increased value of land, a few from remarkable inventions like the sewing-machine, are only exceptions.

From using railroad power to give better rates to the larger man, it was an easy step to using it to make a favorite first a larger man, then the largest man, and finally the only man in the business. In meat and cattle we see men rising from poverty to great wealth. From being competitors, like other men, in the scramble, they get into the comfortable seat of control of the prices at which the farmer must sell cattle, and at which the people must buy meat.[764] Many other men had thrift, sobriety, industry, but only these had the rebate, and so only these are the "fittest in the struggle for existence." We find a merchant prince of the last generation in New York gathering into his hands a share of the dry-goods business of the country which appears entirely disproportionate to his ability and energy, great though these be. Is his secret a brain so much larger than his competitors' brains as his business is greater than theirs? The freight agent of the New York Central testified that he gave this man a special rate "to build up and develop their business."

"They were languishing and suffering?"

"To a great extent."[765]

"This," said the counsel for the Chamber of Commerce of New York before the committee, "is deliberately making the rich richer and the poor poorer, by taxing the poor for the benefit of the rich through the instrumentality of the freight charge."[766]

The officials of the Pennsylvania Railroad, by the use of rebates, handed over the State of Pennsylvania to three coal-dealers, each of whom had his territory, and was supreme in it, as would-be competitors found out when they undertook to ship coal into his market. They made a similar division of the iron and steel business. The rebate is the golden-rule of the "gospel of wealth." We have already seen that the secret of the few corporations which have become the owners of almost every acre of the anthracite coal of Pennsylvania was the rebate.[767]

Along one of the most important lines out of Chicago grain dealers who had been buying and selling in an open market, building elevators, investing capital and life, found five years ago market and railroad and livelihood suddenly closed to them, and the work of thirty years brought to an untimely end. The United States Interstate Commerce Commission, and the United States District Attorneys co-operating with it, broke down in the attempt to compel the railroad men who gave these privileges of transportation, or the business men who received them, to testify or to produce their books. The United States grand-jury in Chicago, in December, 1890, proceeded against the shippers and the railroad men. All of them refused to tell the rates given or received, or to produce their books.