“It will be observed that during these two years the average annual net earnings of the Steel Trust exceeded the total labour cost of their entire product!”
MEDICINAL PRODUCTS
“Turning from the iron and steel industry, we might take quinine, and many other medicinal products; we might take chemicals, many of them most essential in manufacturing industry; we might take borax, which sells in America at seven and one-half cents per pound, and in Britain at two and one-half cents per pound, because the Dingley duty is exactly five cents per pound; we might take mica, a mining product largely used in the electrical, wall-paper and stove-making industries, and which enjoys a modest protection ranging from one hundred and fifty to four thousand per cent. In short, we might take each and every staple product now made in America, and needlessly sheltered by the Dingley duties, and prove, by comparative prices at home and abroad, that the fabulous profits which the gentlemen engaged in these industries are now making—and which they have capitalised into watered “industrials”—are due chiefly and directly to the fostering care of the Dingley Bill, which was designed to protect our ‘infant’ industries.”
In the same issue, another correspondent, Mr. W. J. Gibson, shows how the Government serves as a tool of the trusts in tariff exactions. He gives several columns of facts about such outrages as the “Rupee Cases.” For instance:
“There have been nine or ten decisions on this one question against the Government, and still the secretary of the treasury refuses to refund the money which the courts have decided so often he has exacted illegally. The money he has directed to be wrongfully assessed and collected, and is retaining in these cases, known as “the Rupee Cases,” amounts to over a million dollars. The parties cannot get any interest for their money so wrongfully withheld, and the customs officials are still being directed to assess all merchandise coming from India on the basis of the rupee at the value of thirty-two cents in our money. This has gone on for more than six years, and against the decision of the United States Circuit Court since January 7, 1899.”
And now, can we get any broad view of the results of this long process of wealth-concentration? In 1850 the wealth of the United States was estimated at nine billions; in 1870 it was thirty billions; in 1890 it was sixty-five billions; and in 1900 it was ninety-five billions. How is this wealth distributed? Writing in 1896, Dr. C. B. Spahr made his famous calculation, embodied in the statement that one-eighth of the population owned seven-eighths of the wealth, and that one per cent. owned more than the remaining ninety-nine per cent. And at that time the machinery of exploitation had hardly more than got under way. The best attempt at an estimate since then is the one by Lucien Sanial, published by the American Branch of the International Institute of Social Science. This is the result of a careful analysis of the census of 1900; it shows that of ninety-five billions of the country’s present wealth, sixty-seven billions are owned by a capitalist-class of two hundred and fifty thousand persons, twenty-four billions by a middle class of eight million four hundred thousand persons, and four billions by a working-class of over twenty million persons. And now, if the sixty-seven billions owned by the capitalists be assumed to earn ten per cent.—which is surely a reasonable average amount—our people will be paying interest upon four hundred and fifty billion dollars at the end of the twenty year period!
And that represents the centralisation of the actual ownership of wealth; but one does not get a real understanding of the situation until he begins to consider the centralisation of the control of wealth. In explaining the struggle over the surplus of the life-insurance companies, one of our financial magnates remarked to me: “I would rather have the power of manipulating four hundred million dollars, than the actual ownership of fifty millions.” And with that crucial fact in mind, let one consider the figures given by Mr. Sereno S. Pratt in The World’s Work for December, 1903, and summarised in Dr. Strong’s “Social Progress,” as follows:
“One-twelfth of the estimated wealth of the United States is represented at the meeting of the Board of Directors of the United States Steel Corporation.
“They represent as influential directors more than two hundred other companies. These companies operate nearly one-half of the railroad mileage of the United States. They are the great miners and carriers of coal. The leading telegraph system, the traction lines of New York, of Philadelphia, of Pittsburg, of Buffalo, of Chicago, and of Milwaukee, and one of the principal express companies, are represented in the board. This group includes also directors of five insurance companies, two of which have assets of seven hundred millions of dollars. In the Steel Board are men who speak for five banks and ten trust companies in New York City, including the First National, the National City, and the Bank of Commerce, the three greatest banks in the country, and the heads of important chains of financial institutions. Telephone, electric, real estate, cable, and publishing companies are represented there, and our greatest merchant sits at the board table.
“What the individual wealth of these men is, it would be impossible and beside the point to estimate; but one of them, Mr. John D. Rockefeller, is generally estimated to be the richest individual in the world. But it is not the personal, but the representative, wealth of those men that makes the group extraordinary. They control corporations whose capitalisations aggregate more than nine billion dollars—an amount (if the capitalisations are real values) equal to about the combined public debts of Great Britain, France, and the United States. It is this concentration of power which is significant. There were at the time of the last statement sixty-nine thousand nine hundred and fifty-five stockholders in the Steel Corporation. But the control of this corporation is vested in twenty-four directors, and this board of directors is guided by the executive and finance committees, which in turn are largely directed by their chairmen, who are probably selected by the great banker who organised the corporation and in a large part sways its policy.