With characteristic energy Gorham made good the promise given to Allen
to investigate matters at the office, and not many days after his return
to his desk he issued a call for a special meeting of the Executive
Committee. He looked upon it almost as a weakness to have permitted this
boy's unsupported statements to influence him even to this extent, but
he justified himself by the knowledge that a confirmation of the loyalty
of his associates would give him renewed strength.
The day of the meeting found every member of the committee present--a
fact which interested Gorham as an evidence of the devotion of these men
to the responsibilities which rested upon them. But the routine business
had no sooner been completed than the president became aware that the
harmony which had existed from the beginning was in danger of being
disturbed. Inquiries were made which were too significant to be
overlooked, and veiled criticism came from quarters where previously he
had believed existed absolute confidence in himself and full approval of
his methods.
"It is well to have this come to a head," Gorham remarked after several
had expressed their views. "This corporation is so gigantic that it must
fall of its own weight unless every part of its structure be sound and
effective in bearing its share of the load. There is no stability where
there is lack of harmony, and what you gentlemen have said to-day shows
beyond question that radical and immediate action is imperative to
preserve to our stockholders what we have already gained for them, and
to secure the future benefits which are assured, provided the Companies
itself can act as a unit. Now, in order that we may clearly understand
the situation, will not Mr. Litchfield state specifically the criticism
implied in his remarks?"
Litchfield rose deliberately from his seat. He was the head of certain
large gas-works which the corporation had acquired in connection with
its consolidation of the lighting interests in Philadelphia.
"Before complying with Mr. Gorham's request," he began, "I wish to say
that nothing is further from my intentions than to cast aspersions
either upon our president or his motives. During the time I have served
on this committee I have been amazed by the increasing realization which
has come to me of the marvellous success he has achieved in developing
the Consolidated Companies to the point it has reached to-day. Many of
us have contributed in a smaller or greater degree to its success, but
it has been his master mind which has anticipated the conditions and
provided the means to make the most of them. But it is also true that in
doing this Mr. Gorham has, in my opinion, deliberately neglected to
secure for the Companies as large returns as might have been gained. In
the Philadelphia Lighting Company, for example, with which I am
naturally more familiar than with any of the other ramifications of the
Consolidated Companies, Mr. Gorham has voluntarily reduced the rates
when the consumers had expressed no general discontent with the former
prices. It is true that the consolidation effected great economies in
the production, but it is entirely obvious that the profits to the
company would be greater if we were receiving the full advantage of the
economies by still selling our product at the old rates. And this case
which I have cited is, I understand, a fair sample of Mr. Gorham's
policy in all other directions. I can appreciate the desirability in the
past of giving the people the advantage in a few transactions in order
to create public confidence; but to continue to make a practice of so
doing appears to me to be unnecessary and, I may say, unbusinesslike."
After Litchfield sat down Gorham called upon several others, some of
whom expressed themselves, with more or less frankness, along the same
line.
"Then it all sums itself up in this," he said at length, after having
invited remarks from those who cared to take part in the discussion:
"Your president has been guilty of not making the most of the
opportunities which he himself has created."
This seemed to be the sense of the meeting.
"Then let me ask a few questions," continued Gorham. "Mr. Litchfield has
told us of the reduced cost of production in his plants as a result of
our consolidation. Will he not further state how great that economy is?"
"Thirty-three and one-third per cent.," was the prompt reply.
"And we have reduced the rate how much?"
"Fifteen per cent."
"How much has the business increased during the past year?"
"About twenty per cent."
"And the balance-sheet shows what as to profits?"
"About twenty-five per cent. larger than any previous year."
"In spite of the reduced rates," Gorham added, significantly.
"But they would have been larger still if the old rates had prevailed,"
Litchfield insisted.
"I cannot agree with you," Gorham said, firmly. "Your concern had been
standing still for six years when we took hold of it--the business had
even gone backward the last year--yet in two years' time, under our
administration, it shows a gross gain of thirty-three and one-third per
cent. and a net gain of twenty-five. I am enlarging on Mr. Litchfield's
case because, in a measure, it is an answer to you all, and a full
justification of the basis upon which I have rested and shall continue
to rest the operations of the Companies. It has been my pride that it
was possible to administer the affairs of this corporation in such a way
that not only could we boast that during the five years of our business
existence we had lived up to the principles on which we originally
built, but also that we have proved it a sound financial proposition.
Never before in the history of the world has any body of men associated
themselves in business with the avowed purpose of making their
organization an advantage to the people, without either failing signally
in their undertaking or proving themselves false to their
responsibilities. We have reached a point where failure is impossible;
we find ourselves receiving greater returns upon our investment than is
yielded by any other organization in existence. Can it be possible that
there is one man among us who wishes to take away from the Companies the
unique position which it has now gained?"
It was evident that Litchfield had been appointed the spokesman for the
committee, as he immediately assumed the responsibility of replying to
Gorham's remarks.
"May I not ask our president if he does not overestimate the importance
of standing up so straight that there is danger of falling over
backward? There is no difference of opinion as to the commercial value
of the great asset which he has established for the Companies, in so
completely winning the confidence of the people at large as well as
those who hold high positions of trust. We should stultify ourselves
were we to take any such stand, for the profits of the Companies are an
irrefutable argument. The question before us, then, is not one of fact,
but rather of degree. Why should we spend these further millions to gain
that which we have already secured? We should still so administer the
affairs of the Companies as to hold this great advantage, but I maintain
that we should pay no more to hold it than is absolutely necessary."
Gorham glanced around to see if any one else was disposed to add to what
Litchfield had said, but the silence which prevailed indicated more
clearly than words that the speaker had expressed the consensus of
opinion.
"I am waiting for some one to remind Mr. Litchfield that he has
overlooked, in his statement, a fact which possesses vital
significance," Gorham said at length. "The Consolidated Companies has
received from the people concessions which it has succeeded in making
immensely valuable. It has accepted these concessions in trust upon the
distinct understanding that those who gave them should receive equal
benefit. So far, this trust has been religiously observed. Every dollar
of profit which the stockholders have divided represents a like amount
paid back to those to whom it belongs. To pay them less would be not
only a breach of faith, but would be to retain that which does not
belong to us. It is not for Mr. Litchfield or for me to determine the
amount--the proportion has already been settled by our original
covenant."
Litchfield moved uneasily in his chair as Gorham ceased speaking.
"You put it in rather a disagreeable form, Mr. Gorham. Perhaps the fact
that you have been talking this side of the enterprise for so long has
made you assimilate more of your own theories than is ordinarily the
case. Of course, in the beginning, it was necessary to make the
statements strong in order to be convincing, but there was no
'covenant,' as you call it, and the people are not in a position to
exact an equal division unless we choose to give it to them."
"Can it be that I understand you correctly?" Gorham demanded, with
mingled indignation and amazement. "Do you mean to imply that I have not
been sincere in stating to the public the original basis upon which we
incorporated? Do you suggest that when one party to the agreement has
lived fairly up to his end of it we, the other party, should neglect to
do the same, simply because he has no access to our books and no power
to demand an accounting?"
"You are far too literal in your interpretation of my remarks,"
Litchfield protested, with some warmth. "This parallel you have drawn is
absurd on the face of it. There has been no legal agreement that we
should treat the dear public as if it were in actual partnership with
us. You have held out certain inducements which have secured for us the
concessions, and we have made good the promise you gave that our success
meant advantage to the people. But all this was a means to an end. For
five years the public has shared equally with those of us who have put
money and brains into the Consolidated Companies. No one suggests that
the people should not still continue to receive benefits, but those of
us here present are unanimous in our conviction that the time has now
come to conduct the Companies upon a strictly business basis. This is
not the age for quixotic sentimentality, and the Consolidated Companies
not only possesses the right, but the power to maintain its position
upon the same basis as other smaller and less powerful organizations.
Speaking for myself alone, I am amazed that Robert Gorham, with his
exceptional and acknowledged business acumen, should take a position
with his Executive Committee which is as disadvantageous to his own
interests as it is to the stockholders'."
No one but Gorham himself saw the mist which momentarily rose before his
eyes, yet, when it passed, his vision was clearer than it had ever been.
The men sitting around him represented the flower of the business world,
each one of whom stood before his fellow-men as a tangible expression of
honor and integrity. Yet not one was able to comprehend Gorham's
viewpoint, not one could be anything but incredulous that he stood
sincere in the position he had taken. This was what hurt him most. The
applause which his associates had awarded him had been as that won by a
clever actor rather than, as he had believed, the responsive echo forced
from their souls by the battle notes of a new cause. Their acceptance of
his doctrines had been because his arguments had persuaded them of the
material side of the enterprise. The very magnetism which they had felt
exercised by him upon themselves they had capitalized as an asset to be
assayed when once the ore was stopped. All the high-sounding claims were
turned at this moment into empty platitudes. All his promises were
valueless beyond his personal strength to make them good. To this extent
Allen had been right, but it was not too late to recognize the danger
and to meet it. His associates saw the Robert Gorham they thought they
had known for five years sitting in repose before them while this
realization of the situation surged through his brain--they saw the real
Robert Gorham when he rose to his feet, and faced them with a force they
felt before a word was spoken.
"I could not have believed it possible," he said, "for a moment such as
this ever to arrive. I have lived in this business Utopia for five
years, blind to the fact that those who labored with me failed utterly
to comprehend or to appreciate the sincerity of my motives or the
integrity of my purpose. I admit that I question my ability to make
clear to you by words what my acts have not conveyed. During these
years, and until to-day, you have accepted my judgment as supreme, and
for the first time I realize that this was not because you believed in
it, but because you saw in it advantage to yourselves. The gratification
which I have enjoyed from this supposed tribute has vanished, like the
empty bubble that it was. It has been said that the Consolidated
Companies was a one-man corporation, which I have denied, believing that
my labors were rather those of the pioneer, showing the way to those
associated with me who would naturally follow my footsteps. Again, I was
wrong: this has been a one-man corporation, and it is so to-day. Not
only has the creation of it been mine and mine alone, but also the
successful putting into execution of those principles which I alone
devised. The credit for this, which I have until now proudly conceded to
you, I assume wholly for myself, and I also give myself the further
credit of having, unknown to myself, been the single force which has
compelled you to live up to the high standard I established.
"Now, as the parent of this child which I have seen develop to this
point under my guidance and protection, I stand here prepared to fight
for its honor against you who threaten its destruction--and I warn you
that the parent love dares much. As the Roman Virginius stood with his
sword pricking the flesh over the heart of his beloved daughter, so do I
stand ready to destroy my offspring rather than suffer its dishonor at
the hands of any Appius Claudius. Gentlemen, the Consolidated Companies
has been a one-man corporation in the past through your sufferance; from
to-day, if it exist at all, it shall be a one-man corporation because of
my will. You know that these are no idle words. You know what would be
the result of a single statement from me that the Companies repudiates
its assumed responsibilities. I do not ask--I demand that you gentlemen,
as the Executive Committee of the corporation, pass such resolutions as
will place the authority absolutely in my hands. I ask Mr. Litchfield to
take the chair, while I retire to give you ample opportunity for
discussion. However hard it may be for your personal pride, you will
have to do this--you have too much at stake to gratify your resentment
of my autocracy. But if you can gain any consolation in the knowledge
that you have dealt your president a blow from which it will take long
for him to recover, I beg of you to make the most of it. I believed
that power was the supreme lever with which to move the world, and that
money was but the fulcrum upon which that lever should rest. You
gentlemen have shattered this belief, and have shown me that sordid gold
is the controlling object of man's life. Still, I prefer to remain in my
Utopia, alone if need be, but with your unwilling company so long as my
present strength shall last."
Gorham closed his eyes involuntarily as he ceased speaking, still
standing before his associates. A single tremor passed over his face,
and then it was as impassive as before. With a bow as courteous as it
was impressive, he left the room.