The Conflict between Private Monopoly and Good Citizenship

by John Graham Brooks

But another, weightier reason must now be added,—namely, our private monopolies with their influence and reactions on our whole community life. In the earlier and looser stages of development, when vast resources still remain unappropriated, private monopoly may aid a city or a nation. At first no public protection of fish and game is necessary, but the pressure of population will eventually compel a common rule to which the individual must submit. As surely as a growing town sooner or later requires a common water-supply, a common drainage, common sanitary provisions, and regulated hack charges, just so surely will the private monopoly somewhere and at some time require strict social control,—that is, control from the point of view of all of us and not from that of a few money-makers. A generation ago the stripping of our forests did not matter vitally. The interests that were to suffer from this stripping had not appeared. To-day a forestry policy derived absolutely from the common, social point of view has become a necessity so commanding that the nation's attention is at last caught. A generation ago no one had even guessed at the franchise-value of our streets,—not even those of New York city. After Jacob Sharp had made these values known, a struggle began which reads like an Arabian tale. It is a story of business and political corruption that has gone on in varying degrees in scores of our cities and in scores of great industries where strong men have been fighting to get control of mines, forests, lands, and oil, the development of which depended on favorable transportation. The carrying trade—whether of goods or people—is never to be omitted in this story. Until very recent years, this mother of monopolies, the railroad, was thought of as a purely private possession. A dozen years ago one of our ablest railroad lawyers (often before the United States Supreme Court with great cases) told me it had long been one of his intellectual amusements to try to force into the heads of railroad presidents the fact that their ownership of that kind of property was profoundly different from the ownership of a horse or a grocery store. "I finally," he said, "had to give it up." It meant nothing to them that society had given them stupendous privileges which qualified their ownership. These franchise-grants once in their pockets, everything that was built upon them came to be used in any conceivable game to enrich the owner.

Properly informed persons no longer discuss whether it is right and moral to allow railroad magnates to do as they like—to act as if these properties were strictly a private possession. We know, at last, how society has suffered from leaving this form of ownership so long without social control. We have seen the devastating conflict between unregulated possession of this kind of property and all the higher welfare of the community. If we add to the railway the common city monopolies of lighting and transportation; if we add industries in iron and steel, much of our mining, oil, and forest exploitation, all of which, in connection with railways, take on inevitably the form of monopoly, we have the whole buccaneer-group that has done upon our politics the deadly work, which we know so well that its retelling is a thing to avoid from very weariness.

Though a dozen other cities would serve as well, look for a moment at the monopoly of the New York street-railways. A people, careless and ignorant of their own interests, so far give away the rights in their streets, that a few men get them into their possession. With the grip once fast upon this power, it becomes not a machinery primarily to serve the people: primarily it becomes an enginery to filch vast unearned increments from the public. It becomes a device for gambling, with the dice so heavily loaded in your favor that you cannot lose. You change power from one kind to another; you merge one line with another or with the whole; you create holding companies; and at every change you recapitalize. Your million dollars is turned into five or ten or twenty millions, in order that multiplied dividends taken from the public may drop into private pockets. Every bit of bookkeeping meant for the public eye is a mass of jugglery. If you are frightened by the challenge of an indignant public, the most important records are destroyed. Surplus funds belonging to the stockholders are freely loaned to personal friends or put to private speculative ventures.

This shell-game has gone on decade after decade, so gayly that it seems as if it were a delight to the American people to have their pockets picked. And yet, let us say it over and over again, the pocket-picking is not the worst of it. That the people's money should be used to debauch their own chosen representatives in city and state legislatures is the uttermost evil. Part and parcel of the uttermost evil is the resulting suspicion and distrust that eat their way deep through the masses of the wage-earning world. Not to mention their own trade papers, or the socialistic sheets with the scandals of high and low finance, wage-earners have only to read the capitalistic sheets, presidential messages, and summarized reports from scores of legislative committees, in order to believe that almost everything investigated—insurance, city traction companies, mining syndicates, railway finance—is heavy with rottenness. Any one interested enough to run through the files of the distinctively labor press at the present moment, will find a body of convinced opinion about those who control us industrially that has an extremely ugly look. The labor-world is drawing the only natural inference it can from the data given.

How often we have seen within a year or two the lament that the efficiency of labor has lessened in many of our great industries! What in Heaven's name can we expect? If that labor-world believes what is everywhere cried on the housetops about the crooked exploiting devices of these monopolies, why should not its interest and its fidelity fall off? The law of cause and effect will work here as it works elsewhere in the universe. Labor is learning that unfair industrial privilege flouts every essential principle of democratic government. The real iniquity of it is hidden from us until we see that secrecy, cunning, and unscrupulousness may be good pecuniary assets. Yes, this has to be plainly stated. A man who should happen to have the people's interest really at heart could not be an active partner in the worst of these monopolies. The unscrupulous, the men bent upon the stock-watering game and their own immediate enrichment, would crowd the honest men to the wall. Every line of least resistance is with the get-rich-quick type of manager. To hold his power and to corrupt us politically; to appropriate continuous unearned increment through overcapitalization, he must work not for the public good, but largely against it. In most free competitive business there is no such inherent antagonism between private and public good.

The privileged monopoly is found not only in the lighting and transportation combinations in cities like New York, Philadelphia, St. Louis, and Chicago: it is in a whole nest of industries—oil, mining, and timber—which are interknit with our railroad system.

Here is the real antagonism between monopoly and good citizenship. Anthracite coal is not a business apart—it is a railroad business; and if there are abuses, they cannot be corrected apart from railroad regulation. There is nothing that we now need to know so thoroughly as that the railroad is the one key to the control of all monopolies, including those that often last just long enough to gut the properties according to get-rich-quick principles. The waste of the public wealth under this concentrated stimulus is the darkest economic fact, as the ugliest political fact is the corruption of officials and legislators. Think of a product so vital to the future as the forests; and then picture, if you can, the waste and despoiling of this strictly common wealth that has gone on, and still goes on, in connection with unregulated railroad affiliations,—properties, larger than several Eastern states, stolen, and then burned, and skinned, and devastated, so that two generations cannot repair the loss! And now by highest federal authority we are warned that our timber supply cannot last twenty-five years without a new controlling policy.

Yet it is not, of course, the monopoly that is the evil. It is solely the way in which we have allowed the monopolies to be owned and controlled. We have admitted a kind of irresponsible proprietorship that has so debased political methods in the United States that we are made at the present moment (in this one respect) a warning to the world.

Last year a social investigator returned from New Zealand. He said: "I found their able men chiefly anxious to avoid the example of the United States. Their problem is to develop a rich and prosperous industrial life, but escape the rottenness of American politics. Whether they succeed or fail, their purpose is great." Their plan is to use the strength of the government to prevent the formation of private monopolies such as have debauched our politics until we have become a mockery among the nations.