It was the period of Cornelius Vanderbilt, Daniel Drew, Jay Gould, and

“Jim” Fisk; the period in which were conceived and carried out the

famous “corners” in Harlem, in Hudson River, and in Erie stocks. None

of the leaders in these speculations would have shone in Newport or in

the polished, well-groomed crowd that watches the races at Deauville or

takes the “cures” at Vichy or at Nauheim. Cornelius Vanderbilt, the son

of a farmer in moderate circumstances on Staten Island, was ferrying

passengers over to New York at sixteen years of age, and at the age

of eighteen owned two boats and was captain of a third. He derived

his education from practical experience, his successes from innate

shrewdness. Daniel Drew, beginning as a drover and afterward the keeper

of a tavern, never sought to rise socially above his early environment.

To a reported trick of his in early life is ascribed the familiar

stock-market expression, “watering stock.” According to the legend,

Drew gave his cattle salt in order to create a thirst, which would

cause them to drink freely and make them appear bigger and fatter when

brought to market. He was negligent in his attire, even to the verge of

slovenliness, and never departed from the provincial pronunciation of

his youth. In many a broker’s office where he called for his securities

his loud demand for “them sheers” was long remembered.

THE BATTLE OF THE GIANTS OVER ERIE

“The Commodore,” as Vanderbilt was familiarly called, was seeking to

develop the Hudson River property, when he found it assailed by a large

“bear” element. Immediately taking the situation in hand, he tricked

his opponents into the belief that his position was weak, and lured

them into increasing their output of short stock. Getting virtually

all the real stock in existence into his possession, and accepting

contracts for additional amounts from the short interest, he soon had

the market at his mercy. From 112 the stock rose in a few days to 180.

The shorts, unable to make the deliveries they had contracted for,

begged for mercy, and the stock was sold back to them at a handsome

profit.

Much more complicated and daring were the operations of Daniel Drew,

Jay Gould, and Fisk in Erie. The story of their use of the Erie

road is worth outlining, if only to illustrate methods which in the

financial world of to-day would no longer be tolerated, even if they

were possible. In July, 1868, the Erie Railroad became the personal

property of Fisk and Gould. The board of directors held no meetings;

the executive committee never was called together. The Erie offices

were moved to a white marble “palace” on the corner of Eighth Avenue

and Twenty-third Street, which was furnished with vulgar ostentation,

contained an opera-house (still a popular theater), and was connected

with the private apartments of Fisk. Just before this (in 1866), Drew

had operated his famous plan of loaning money to the Erie Railroad on

the security of stock and convertible bonds, and converting the bonds

into stock to meet his short contracts.

It was the acquisition by Commodore Vanderbilt in 1867 of the New

York Central Railroad which brought him into conflict with Drew and

Gould. “The Commodore” desired to acquire Erie. To guard against the

transformation of more “convertible bonds” into stock, he employed

the services of Frank Work to obtain from Judge Barnard an injunction

restraining Drew from the payment of interest on $3,500,000 in bonds,

pending an investigation of his accounts as treasurer of the railway.

But Drew was equal to the emergency. Under a statute authorizing any

railroad to create and issue its own stock in exchange for that of a

leased line, he and his associates issued against an insignificant

property, worth perhaps $250,000, the amount of $2,000,000 in

Erie stock. Deals and counter-deals, and injunctions to restrain

injunctions, did not prevent Fisk from seizing the enjoined stock

certificates by force, nor Drew from aiding him by throwing 50,000

shares on the market and breaking Vanderbilt’s attempted “corner.” It

is said that while new stock was thus being put out, Fisk summed up

the purposes of his clique toward Vanderbilt in the remark, “If this

printing-press don’t break down, I’ll give the old hog all he wants

of Erie.” Vanderbilt was credited with spending $7,000,000 in this

operation, and it was the wonder of his friends that he was not ruined.

To tell fully the story of these battles of the financial giants would

be beyond the scope of a sketch like this. How Gould and Fisk succeeded

Drew in control of the Erie; how they nearly ruined him when he came

back into the speculative field; how Judge Barnard authorized Gould and

Fisk to sell their Erie stock, issued at 40, back to the corporation

at any price less than par, is a story of surpassing interest, but it

represents methods long since discarded in American finance.

THE CHICAGO AND BOSTON FIRES

During these years of unsettlement and wild speculation, the country

seemed pursued by an evil destiny. About two years after business

credit was so seriously disturbed by the incidents of “Black Friday,” a

destruction of capital amounting to more than $200,000,000 was caused

by the great fire in Chicago, and within another thirteen months came

the great fire in Boston. It was a quiet Sunday on October 8, 1871,

when a small wooden barn on De Koven Street, Chicago, surrounded by

cheaply-built wooden buildings and lumber-yards, burst into flames.

Sweeping ruthlessly through the fire-traps of the western division

of the city, the fire soon got beyond control, wiped out the Union

Depot and the Pittsburgh and Fort Wayne Terminal, and destroyed in

this division alone five hundred buildings. This, however, was only

a beginning. All night Sunday and the following Monday the flames

steadily advanced over the southern division, comprising nearly the

whole of the business district, and then to the northern division,

comprising many private residences. Business blocks of brick and

granite melted like wax before the flames, which swept clear up to the

water-front of Lake Michigan, and spread a pall of smoke and cinders

far across the northern sky. All the wholesale stores, the newspaper

offices, and the principal banks, insurance-and law-offices were

reduced to smoldering heaps of ruins. The court-house, custom-house,

and other public buildings, and nearly all the hotels, suffered the

same fate. Crowds of people, driven from their homes, camped in the

parks and sought refuge in the buildings left standing.

In the southern division, which was the business district, it was

calculated that 3650 buildings were destroyed, including 1600 stores,

twenty-eight hotels, and sixty manufacturing establishments. The

number of people rendered homeless was estimated at 2250 in the

western division, 21,800 in the southern division, and 74,450 in the

northern division. The total money loss in buildings was calculated at

$53,000,000; business stocks and produce, $84,000,000; and personal

effects, $58,000,000. This total of nearly $200,000,000 was swelled

by the depreciation of property which naturally followed such a

destruction of values. The total valuation of the city before the fire

was estimated at $620,000,000, and the population at 334,270. The

insurance in force in the burned district was about $100,000,000; but

fifty-six insurance companies suspended, and only about $40,000,000 in

insurance was collected.

The Boston fire broke out on Saturday, November 9, 1872. The

fire-department was crippled in fighting the fire by a remarkable

epidemic, or distemper, which prevailed among the horses. So

completely were the horses of the city disabled that ordinary local

deliveries of merchandise had almost come to a standstill; some of the

street-railways had ceased running, and teaming by oxen or by gangs

of men was the only means of moving freight. On Saturday, October

26, a meeting was held at the City Hall of the board of engineers

of the fire-department to decide upon a course of action in case of

serious fire during the distemper. It was decided that the strength of

each fire company should be temporarily doubled by the enlistment of

volunteers, and that drag-ropes should be furnished each engine-house

for the purpose of drawing the apparatus by hand. But with these

precautions was taken a step which probably contributed materially to

the delay in attacking the fire of two weeks later. It was provided

that the hose-jumpers should alone be taken out on a first alarm, and

that the engines were to follow only in case of a second alarm, unless

the fire was above the third story.

The neighborhood in which the fire broke out was at the corner of

Kingston and Summer streets. This corner was then on the fringe

of the business district, with the remains of some of the old

aristocratic homes of the city still standing, which had, however,

for the most part, been converted into boarding-houses. It was in a

five-story granite block that the fire began, and the whole building

seemed to leap into flames before there was any response from the

fire-department. Inexplicable delays seemed to attend the arrival of

the engines. The fire was already visible in Charlestown before 7:10,

and the alarm at City Hall was received only at 7:24 ~P.M.~ from

box No. 52. Box No. 52 was known among the city firemen as “a bad box,”

because it was in the heart of the dry-goods district, which was filled

up with costly and inflammable stocks, and the principal water-mains

were of insufficient size, put in years before, when it was a region

of quiet dwellings. Only two engines left their quarters on the first

alarm. Two others soon followed, but it required the third alarm, at

7:34, to bring out the rest of the force. Then, as the fire was gaining

headway, went out the general alarm, and messages were rushed by

telegraph to neighboring towns and cities to come to the aid of Boston.

The fire was already beyond control. Walls were toppling into the

street, great billows of flame surged into the air, and the fire

began pressing through street after street until it destroyed Trinity

Church and threatened the Old South. At this historic spot was wrought

something like the “miracle” that occurred on the field of Waterloo,

when the burning of the chapel at Hougomont stopped when it reached the

crucifix. The Old South was saved, and the fire was checked at Milk

Street on the line between Devonshire and Washington streets.

The out-of-town engines in the meantime had been pouring into the city

at all hours of Saturday night and up to Sunday morning, and rendered

heroic services in raising a wall of water against the flames. Crowds

of citizens gathered on the corners and watched the struggle to stay

the fire. President Eliot of Harvard University mingled with the crowd,

his mind weighed down perhaps by the thought of the injury to Harvard’s

endowments invested in Boston real estate. Phillips Brooks, the young

rector of Trinity, stayed in the church, then on Summer Street, near

Hawley, until lines of flame were creeping along the rafters. Powder

was used in some cases to blow up buildings and thereby destroy the

fuel for the flames.

In Boston as in Chicago, soldiers were called to the aid of the civil

authorities to patrol the smoking heaps of ruins, in which were

buried many safes containing money, jewelry, and valuable documents.

Serious as the fire was, it did not sweep over any such territory as

in Chicago, nor represent half of the Chicago loss. The total loss in

Boston was estimated at $75,291,530, out of a valuation for the entire

city (which did not then include Charlestown and other suburbs) of

$682,724,300. Buildings and property were largely insured, but the

magnitude of the calamity again carried down many insurance companies

and permitted them to pay only a percentage of their losses. Upon the

whole, however, the insurance companies acquitted themselves with

remarkable credit, the Massachusetts mutual companies, of which there

were fourteen, paying losses in full except two. Companies organized in

other States to the number of about 120, which had Boston risks, paid

their losses in full, with the exception of four companies.

THE PANIC OF 1873

The panic of 1873 was the natural result of the destruction of capital

by war, fire, and unwise investment which had been going on during

the previous decade, and of the encouragement given to speculation

by a fluctuating paper currency. The money-markets of the world had

to reckon not only with the enormous destruction of property during

civil war in the United States, but with the similar fruits of two

other recent wars: that between Germany and Austria in 1866, which was

crowned by the victory of Germany at Sadowa, and the great war between

France and Germany in 1870, for which France was compelled to pay to

Germany an indemnity of a thousand millions of dollars. The direct cost

of the American Civil War, exclusive of pensions, has been estimated

at more than $5,500,000,000, and the cost of the Franco-Prussian War

at only $2,700,000,000, owing to its shorter duration. An enormous

amount of capital also was absorbed in the ten years prior to 1873 in

the building of railways. New construction in the United States in 1870

was 5690 miles; in 1871, 7670 miles; in 1872, 6167 miles; and in 1873,

including a part of the period of panic, 3948 miles. In Russia a system

of 12,000 miles of railway had been almost entirely created since 1868,

and in South America nearly $200,000,000 in English capital had been

borrowed, mostly for railway enterprises. It was at about this period

also that the substitution of Bessemer steel for iron began, as the

material for rails, sending thousands of dollars’ worth of old rails to

the scrapheap.

The severity of the panic in the United States, as well as in Austria,

was heightened by the state of the currency. There had been, up to

the climax of the Civil War, an almost uninterrupted decline in the

value of the paper money issued by the United States Government, and a

corresponding rise in paper prices. With the close of the war, these

movements were reversed. A rise in the value of the currency began,

and also a decline in prices. This decline in prices spelled ruin to

many who had bought real estate or merchandise in the expectation

of its rise in value, and it imposed paralysis even upon the more

conservative, who had correctly read the downward tendency of values

expressed in paper money.

The specific cause usually assigned by economic historians for the

panic of 1873 was the failure of the great house of Jay Cooke and

Company, as the result of tying up its resources in the Northern

Pacific Railway. The incident was, however, only typical of the times;

and if Jay Cooke never had lived, the story would have differed chiefly

by the substitution of another name for his. The house of Jay Cooke

and Company had grown to power and prestige by the clever and original

methods employed by Mr. Cooke in borrowing money for the Government

during the Civil War. Cooke was a true child of the new America, the

first or nearly the first male child born, as he was fond of boasting,

in Sandusky, Ohio. Through political and social connections, he entered

a Philadelphia banking-house during the period of hazardous financing

and State banking before the Civil War, and had made enough money by

1859, while still under forty years of age, to contemplate retiring

from active business. But his was not a nature for inactivity. The

close relations established by his father and his brother with Salmon

P. Chase, the new Secretary of the Treasury, obtained Cooke a hearing

in the floating of the early war loans. He was not of the old style

of banker, who sat in his office waiting for a customer to come in;

he quickly realized that if the Government was to obtain the money

necessary to carry on the war, it must be by educating the people to

understand the value of the war bonds, and the necessity of taking them

as a patriotic duty.

It was a wonderful campaign of advertisement, of canvassing the

post-offices, of manipulating the press, and of removing opposition,

which Cooke carried on in floating hundreds of millions of the

five-twenties, the ten-forties, and the seven-thirties. The later

flotations, however, which came after the war, required perhaps as much

skill as the earlier ones, because they involved persuading the people

to retain their public funds while accepting considerable reductions

of interest. Inevitably Cooke’s success drew competitors into the

field. When the question of refunding arose, a committee representing

other New York banking-houses appeared in Washington to demand a share

in the operation. The composition of this committee is of interest

because it was virtually the first appearance on the stage of public

finance of John Pierpont Morgan, then a young man of thirty-five. He,

with Levi P. Morton, who had established the banking-house of Morton,

Bliss and Company, and had enlisted the aid of the Rothschilds,

appeared in Washington in January, 1873, and demanded and obtained

from Secretary Boutwell a share in the new issues. The methods of the

syndicate had little of the “go” of the old Cooke methods, and already

the tightening of the money-market was making itself felt. Where

subscriptions of $600,000,000 had been expected for the new loan, they

amounted after several weeks to less than $50,000,000, and the entire

operation was ultimately suspended by the outbreak of the panic.

The lack of uninvested capital to subscribe for the government loan was

a warning of conditions prevailing in the money-market generally. Jay

Cooke, swept along by the great success of his methods in disposing

of the war loans, believed it possible to perform the same miracle

with the bonds of the Northern Pacific. It was his calculation that he

could sell bonds as fast as he was called upon for money for the work

of construction, and it was distinctly provided in the contract with

the road that the advance in excess of the amounts realized from sales

of bonds by the bankers never should exceed $500,000, which itself was

secured by the deposit of the company’s bonds at fifty cents on the

dollar.

During the summer of 1872, however, with President Grant’s campaign

for re-election against Horace Greeley at its height, sales of bonds

fell to a few hundred thousand dollars a month, while the drafts of the

treasurer of the railway company were running at about $1,000,000 a

month. Inevitably, the balance of floating indebtedness by the railroad

to the banking house began creeping up, until it stood near the close

of August at $1,583,000. Ex-Secretary McCulloch, who had become head of

the London connection of Jay Cooke and Company, and other associates of

Cooke were quick to realize that the house was getting into deep water,

and that further uncovered advances must be stopped. It was much easier

to lay down this rule, however, than to carry it out. Already there

were complaints along the line of construction that wages were not

being paid promptly and that men were being laid off. Smaller railway

enterprises in hands less strong were going to the wall from similar

causes, and in October, 1872, the coupons were defaulted on the St.

Paul and Pacific road, in which a controlling interest was owned by the

Northern Pacific.

The year 1873 was thick with omens of disaster for the new railway

enterprises. The Boston fire of the previous November, while not so

disastrous as that in Chicago the year before, caused a crash in the

stock market similar to that which followed the San Francisco fire in

1906. Scandalous frauds were disclosed in the management of the Erie

Railroad; General John C. Frémont failed conspicuously in an effort

to raise money for the Southern Pacific system in France; and at

last grave exposures were made in connection with the Union Pacific

Railroad, which resulted in the Crédit Mobilier investigation and its

long train of scandals. A traveler in Germany wrote home in August

that an American railway bond, “even if signed by an angel in heaven,

would not sell.” So desperate was the situation becoming that Henry

Cooke, brother of Jay Cooke, put his chief dependence, in a letter to

his brother, on “an unfailing confidence in the God in Whom we put our

trust.” “I do not believe,” he said, “He will desert us.”

But the Lord did not intervene to prevent the results, which seemed to

the profane to be an inevitable outcome of economic laws. Jay Gould was

still manipulating a powerful gold pool in the late summer and early

autumn, when on September 8, 1873, the first rude blow was given to

the card house of the New York money-market. The New York Warehouse

and Security Company suspended, followed five days later by a firm

with which Daniel Drew was associated. When Jay Cooke reached his

Philadelphia office on September 18, he found a despatch announcing

that the New York office had been closed by his partners in that

city. The news spread like fire on one of the Northern Pacific’s own

dry prairies. Other houses fell the same day or the next day; stocks

dropped from twenty to forty points; money could hardly be had at any

price; and the Stock Exchange Committee closed the exchange, in the

language of the vice-chairman, “to save the entire Street from utter

ruin.”

While ultimately the assets of the failed house proved to be amply

adequate to meet its liabilities, the career of Mr. Cooke as a

financier was ended. Facing cheerfully for a time the prospect of

extreme poverty, he found his fortune partially recouped six years

after the panic by an almost forgotten mining investment. Repurchasing

his old home in the suburbs of Philadelphia, he continued to live

there, content with the society of his children and grandchildren,

his farming and fishing, almost forgotten by the new generation of

Americans, until his death in 1905 at the age of eighty-four. In his

great cape cloak and his wide-brimmed, gray, soft felt hat, set over

a gentle face adorned by a long white beard, his patriarchal figure

was long familiar in the streets of Philadelphia, a very different

type from the shrewd, grasping men who speculated in their country’s

fortunes in the New York gold-room.

THE FIRST MOVE FOR A CONTRACTION OF THE CURRENCY

The disorder and discouragement caused by the panic did not make easy

the return to a sound monetary system. Already, prior to 1873, the

people had expressed themselves against the policy of acute contraction

so vigorously urged by Secretary McCulloch. The return of the Southern

States to the Union naturally opened a new field for the circulation

of greenbacks and national bank-notes. Influenced by this wider area

of circulation for the employment of money, and by the improvement of

public credit, the greenbacks rose from a gold value of $49.50 in 1865

to $71.20 in 1866, for $100 in paper. There was little further change

in average value until 1870, when there was a gain of about $10 per

$100 and a further advance the next year to $88.70, which remained

substantially the average during the years of depression that followed.

The average value of these years, however, is no measure of the

fluctuations, which arose naturally from differences in the demand for

currency and were made erratic from time to time by speculation.

Up to 1875 no one knew what steps were to be taken, or whether any were

to be taken, to restore specie payments. Half a dozen different schools

argued crudely, with imperfect economic knowledge and narrow horizons,

as to the proper policy to be pursued. For a moment the sturdy

Scotchman, McCulloch, at the head of the Treasury from 1865 to 1869,

carried Congress with him in his policy of sharply contracting the

volume of government notes by an issue of bonds. A resolution passed

the House of Representatives on December 18, 1865, by a vote of 144

to 6, that the House cordially concurred in the view of the Secretary

of the Treasury in relation to the necessity of a contraction of the

currency, with a view to as early a resumption of specie payments as

the interests of the country would permit, and that “We hereby pledge

coöperative action to this end as speedily as practicable.”

The problem was not, however, so simple as it seemed. The greenbacks

formed considerably more than one half of the currency circulation

of the country. Unless gold or some other form of currency could be

brought in, their retirement would mean violent contraction at the

very moment when the new field of the South had been opened to the

national money. While such a contraction would undoubtedly have tended

to bring the greenbacks up with a jerk to their old parity of 100 cents

in gold, such a sudden enhancement in the value of the monetary unit

would have caused a fall in prices which would have spelled wide-spread

ruin. Only vaguely, apparently, was this danger apprehended by advanced

economists; but the danger was real enough to arouse among the masses,

especially in the debtor States, stubborn opposition to immediate

resumption or to the reduction of the volume of paper currency.

Mortgages on farms, running for three, five, or even ten years, which

had been incurred in paper, if required to be paid back in gold would

have absorbed more than the total value of the farms. Other conditions

are thus summed up by Senator Theodore E. Burton of Ohio in his “Life

of John Sherman” (1906):

Prices were high in 1865; great investments were made in numerous

enterprises at the existing high prices; agricultural areas of the

West were rapidly developed, and the production of cereals vastly

increased. With the returning soldiers of the disbanding armies,

and increased immigration from abroad, new fields were settled.

The change of so great a multitude of soldiers from consumers to

producers, changed the relation between demand and supply in many

classes of products.

WHETHER TO PULL THE GREENBACK UP OR THE GOLD DOLLAR DOWN

During the thirteen years from July 1, 1865, to July 1, 1878, six

months before the resumption of specie payments, the net monetary

stock of the country in circulation remained practically stationary,

and the per capita average was reduced by the addition of thirteen

millions of population from $20.57 to $15.32. It is not surprising that

under the pressure of such drastic contraction, all manner of financial

heresies sprouted and thrived. The amazing proposition came from

President Johnson himself, in his annual message of 1868, that inasmuch

as the holders of government securities had received upon their bonds

a larger amount than their original investment, as measured by gold,

it would be just that the six per cent. interest then paid them

should be applied to the reduction of the principal of the debt, thus

liquidating it in sixteen years and eight months. Thaddeus Stevens, the

great congressional leader of the Civil War, made violent speeches in

favor of paying the bonds in paper. In the West, the proposition was

so warmly advocated by Senator Thurman of Ohio that it became known as

“the Ohio idea.”

It is a question whether the soundest economic policy would not have

been to take the resolute steps for resumption supported by McCulloch

and the Eastern bankers, and at the same time to adopt a new monetary

unit which recognized the status quo; in other words, to create a new

gold dollar worth 75 or 80 per cent. of the old. This was the principle

adopted by Austria-Hungary in 1892, by Russia in 1895, and by Mexico

in 1905, in bringing to an end the instability of their currency and

planting it upon a permanent basis of gold. The conclusive argument

for such a policy lies in the fact that it recognizes and crystallizes

the existing purchasing power of money, in which prices are expressed,

instead of seeking violently to change it. It thus permits the

transition from the old unstable basis to the new fixed basis without

jar, and without radically changing the relations between the holders

of money and those who are under contracts to pay money.

Monetary science was less advanced, however, in 1865 than it is in

our time. In the United States the problem of the monetary unit was

entangled by both parties with the very different problem--whether the

bonded debt of the Government should be paid in the money in which it

had been promised. While ultimately the country reached the ideal of

the most pronounced hard-money men of pulling the greenback up to 100

cents in gold, it was at the cost of six years of falling prices, which

spread a pall over real estate and industrial development, and ruined

many men who had in good faith bought property at its valuation in

paper when paper was the legal-tender money of the country.

The ink was hardly dry on the resolutions by which the House approved

the proposals of Secretary McCulloch in 1865 before a counter movement

set in. By the following April a bill had been enacted aimed at tying

the secretary’s hands by limiting the retirement of United States notes

to $10,000,000 for the next six months, and thereafter to $4,000,000 a

month. In the face of two succeeding annual reports by the secretary

in favor of contraction, Congress, by the act of February 4, 1868,

suspended entirely his authority to make any reduction of the currency

by retiring or canceling United States notes.

[Illustration: THE FINANCIAL BOOM

“Lay low!”

FROM A CARTOON BY THOMAS NAST IN “HARPER’S WEEKLY,” DECEMBER 27, 1879]

GENERAL GRANT’S SERVICE TO SOUND MONEY

Thus matters stood up to the inauguration of President Grant. Early in

his term was passed the “act to strengthen the public credit,” with

its courageous declarations that “the faith of the United States is

solemnly pledged to the payment in coin, or its equivalent, of all

obligations of the United States not bearing interest, known as United

States notes, and of all interest-bearing obligations of the United

States.” The final clause was subject to a few proper exceptions;

but coin was then held to mean gold, and the Government thus stood

committed to establish its monetary system, as well as to discharge

its debts, upon the basis of other advanced nations. General Grant as

President brought to the solution of financial problems much of that

grim, hard sense which served him so well in the field. In his annual

message of 1869 he urged resumption of gold payments, but added:

[Illustration: BY INFLATION YOU WILL BURST

~Uncle Sam~: “You stupid Money-Bag there is just so much Money

in you; and you can not make it any more by blowing yourself up!”]

[Illustration: LET WELL ENOUGH ALONE, AND DON’T MAKE IT WORSE

Money is _tight_, but let it recover itself naturally, and then it will

stand on a _Sounder Basis_.

Stimulants or _Inflation_ only bring _final collapse_.

FROM CARTOONS BY THOMAS NAST IN “HARPER’S WEEKLY,” DECEMBER 20, 1873]

“Immediate resumption, if practicable, would not be desirable. It would

compel the debtor class to pay, beyond their contracts, the premium

on gold at the date of their purchase, and would bring bankruptcy and

ruin to thousands.”

[Illustration: RESUMPTION (?)

~Uncle Sam~: “There is no circulation in that leg, and it’s

swelling every day more and more. Mortification will set in, and I am

sure my other leg will be affected. Now Dr. ~Sherman~, something

must be done, and quick, too.”

FROM A CARTOON BY THOMAS NAST IN “HARPER’S WEEKLY,” NOVEMBER 29, 1879]

But Grant, like other Republican Presidents, set his face like a flint

against further inflation. When he received from a Congress controlled

by his own party the so-called “Inflation Bill” of 1874, authorizing

the increase of the volume of greenbacks to $400,000,000, he promptly

returned it with his veto. John Sherman, a leading member of the Senate

Committee on Finance, who had been unwilling to follow McCulloch in

1865, became convinced by 1873 that the time had come for setting a

definite date for specie resumption. His method was not to retire the

greenbacks, but to provide a gold fund for their current redemption.

It was not until the crushing Republican defeat in the Congressional

elections of 1874, however, that the party was ready for action. In the

short session of December a special committee of Republican senators

was appointed, from whose labors emerged the Resumption Act of January

14, 1875. It was a vague and evasive measure, purposely avoiding

questions upon which there were wide differences of opinion; but it

contained the one salient declaration that “on and after the first

day of January, 1879, the Secretary of the Treasury shall redeem in

coin the United States legal-tender notes then outstanding, on their

presentation for redemption at the office of the Assistant Treasurer

of the United States in the City of New York.” It also placed power in

the hands of the Secretary of the Treasury to prepare and provide for

resumption.

WHEN THE GOLD WAS THERE IT WAS NOT WANTED

Market conditions did not at once respond to this promise; but after

the election of Hayes, a sound-money President, in 1876, and the

gradual accumulation of gold, under the guiding hand of John Sherman,

as Secretary of the Treasury, the same man who had managed the passage

of the Resumption Act, it began to be understood that specie resumption

was to be actually accomplished. The banks of New York City, which

held about $125,000,000 of the $346,000,000 in legal-tender notes

outstanding, abolished special gold deposits and agreed with the

Treasury to receive and pay balances without discrimination between

gold and notes. The news of these arrangements, completed in November,

1878, removed lingering doubts. In the gold-room of the New York

Stock Exchange--the scene of so much agitation on “Black Friday” nine

years before--a sale of gold was made, on December 17, 1878, at 12:29

~P.M.~, at par. It was the first sale at par in sixteen years,

but so quietly was the transaction accomplished that only three or

four persons who stood near the registrar’s desk were cognizant of

it. When the first of January, 1879, dawned, the banks, which might

have presented millions of notes for gold, did not ask for a dollar;

and the dull corridors of the New York Sub-Treasury hardly afforded

an indication that the United States had reached and passed a crucial

point in her history and on that day had reëntered the circle of

solvent nations. Truly, the experience of that day, carefully prepared

for as it had been, and attained at much cost and suffering, seemed to

verify the contention of those who for many years had insisted that

“The way to resume is to resume.”

[Illustration: BE SOUND IN MIND AND BODY

~Uncle Sam~: “As long as I keep these outstanding notes on

my mind, which I am well able to pay, I am violating the laws of my

constitution: and how can I expect my body to recover when my mind is

not at ease?”

FROM A CARTOON BY THOMAS NAST IN “HARPER’S WEEKLY,” DECEMBER 13, 1879]

THE “CROSS OF GOLD”

Twenty-one years were to pass, however, before the country was to be

extricated finally and absolutely from the shadow of an uncertain

monetary standard. Specie resumption had not been accomplished when a

bill was passed over the veto of President Hayes, on February 28, 1878,

providing for the infusion of large masses of silver dollars into the

circulation. This was followed by the so-called Sherman Silver Law of

1890, further increasing the amount of silver to be absorbed by the

Treasury. The underlying motive for an increase in the monetary stock

was the steady contraction which had been going on in the effort to

restore the paper dollar to its old parity with gold; and for a time

the country absorbed without apparent risk the additions made by the

silver to the currency of the country. Gold exports set in, however,

in heavy volume after the law of 1890; the Treasury began to lose

its gold; and soon after the inauguration of President Cleveland, in

1893, the country stood face to face with the destruction of the gold

standard. Panic supervened, and only at a special session of Congress

in the autumn of 1893 was the further purchase of silver suspended by

law.

The country lay prostrate for three years under a variety of ills, from

which a young prophet from the West sought to rescue it by raising

the standard of the free and unlimited coinage of silver “without the

aid or consent of any other nation.” For a moment it seemed that the

majority of the voters would respond to the electric thrill conveyed

by this young leader, William Jennings Bryan, to the Democratic

National Convention of 1896, when he wound up his famous speech with

the declaration, “You shall not press down upon the brow of labor this

crown of thorns; you shall not crucify mankind upon a cross of gold!”

A REAL CROSS OF GOLD

The country decided for the continuance of the gold standard, and

its decision was crystallized into law by the act of March 14, 1900.

This act set aside for the protection of the greenbacks the sum of

$150,000,000 in gold, to be kept inviolate from all other uses, and

declared the bonds and other obligations of the Government to be

redeemable in gold and in gold only. But the causes that were operating

prior to 1892 to cause contraction in the monetary stock were reversed

after that date by the great outpouring of new gold from the mines of

South Africa and the Klondike. New processes of separating gold from

low-grade ores made profitable fields that in earlier years would have

been considered unavailable. The gold production of the world rose from

$113,000,000 in 1890 to $202,251,000 in 1896 and $454,000,000 in 1910.

Gold flowed into the Bank of England in the summer of 1896, even while

Mr. Bryan was making his canvass for free silver, to an amount never

before recorded in monetary history; and the beneficent flood soon

overflowed the coffers of the advanced commercial nations and filled up

the void in metallic money in such developing countries as Argentina,

Brazil, Mexico, and India. In place of the fear of a scarcity of

gold, which hung like a pall over some minds at the close of the last

century, such a redundancy of the yellow metal arose that swollen bank

reserves stimulated loans at low rates, manufacturing plants were

extended, and prices of commodities advanced with a rapidity which

lessened the purchasing power of wages and threatened to reduce the

world to the unfortunate state of Midas, making gold a curse instead of

a blessing.

It is this situation which has reduced the real income of the laborer,

the professional man, and other classes, through the diminished

purchasing power of their money, which is imposing a true cross of

gold on the world to-day, and which presents to a new administration

the problem of finding a way to establish and maintain an equitable

standard of value.

[Illustration]

[Illustration: Owned by Ernest W. Longfellow and now in the Boston

Museum of Art. Half-tone plate engraved by H. Davidson

THE WIDOW

FROM THE PAINTING BY COUTURE

(EXAMPLES OF FRENCH PORTRAITURE)]

[Illustration]

FOR A BLANK PAGE

BY AUSTIN DOBSON

[Illustration]

Life, like a page unpenned,

Spreads out its whiteness,

Nothing, from end to end,

Marring its brightness.

Surely a field to claim

Steadfast endeavor?

Where one might win a name

Vocal forever?

[Illustration]

Now--to review it all--

What a prosaic,

Patched, unmethodical,

Paltry mosaic!

Plans that ne’er found a base;

Wingless up-yearning;

Speed, that ne’er won the race;

Fire, without burning;

Doubt never set at rest,

Stifle or falter it;

Good, that was not the best--

Yet, would you alter it?

Yet, would you tread again

All the road over?

Face the old joy and pain--

Hemlock and clover?

[Illustration]

Yes: for it still was good,

Good to be living;

Buoyant of heart and blood,

Fighting, forgiving;

Glad for the earth and sky,

Glad--for mere gladness;

Grateful, one knew not why,

Even for sadness;

Finding a ray of hope

Gleam through distresses;

Building a larger scope

Out from successes;

Careless of loss and gain,

Rendering ever,

Both for the joy and pain,

Thanks to the Giver.

[Illustration]

So, though the script is slow,

Faint though the line is,

Let the poor record go,

Onward to _Finis_.

[Illustration: From a photograph by Pach

THE MORGAN LIBRARY, EAST THIRTY-SIXTH STREET, NEW YORK

(Architects, McKim, Mead, and White)]

MR. MORGAN’S PERSONALITY

AS VIEWED BY HIS FRIENDS

BY JOSEPH B. GILDER

It was in the panic days of 1907--late October. The Secretary of the

Treasury had hurried from Washington to New York, and was spending his

days (long days they were, too) at the Sub-Treasury and his evenings at

the Manhattan Hotel, where all who needed to could see him. Meanwhile

the bankers conferred daily at Mr. Morgan’s office, across the street

from the Sub-Treasury, and nightly at his library in Thirty-sixth

Street. While they put their heads together and worked out details,

their host spent most of his time in his private room in the library

building, not infrequently playing solitaire. But he was always within

reach when counsel was needed; and his word was law.

To allay popular fears, it was decided to issue a public statement, and

the library conferees prepared one and took it up to show to Secretary

Cortelyou at his hotel. Mr. Morgan went with them. He had not yet seen

the statement, and when one of the party started to read it aloud,

he stopped him at the first sentence. “Is that correct?” he asked.

“It will be by the time the statement is published,” was the reply.

“No, gentlemen, that won’t do. If it isn’t so _now_, we can’t say it.

We’ve got to state the facts exactly as they are. The public must have

the truth and nothing but the truth.” And the statement was modified

accordingly.

Mr. Morgan had had just half a century’s preparation for doing the

public the immense service he rendered it in “composing” the panic

of 1907; for he had been in the banking business since 1857--another

panic year. Ability, experience, character, reputation, and financial

resources were his, and had put him in a position to ride the whirlwind

and direct the storm. He had done wonders to preserve the national

credit before the year 1907, but it had never fallen to his lot to do

anything quite so spectacular (though unintentionally so) as he did at

this time. What he did, no one else, however capable, could have done,

or, at least, have done so well. It needed just the combination of

attributes and qualities he possessed to give the needed authority to

his acts.

His whole character was summed up in the brief sentences addressed to

his fellow bankers in Mr. Cortelyou’s presence. Always his words were

few; but always they were pregnant and unequivocal. What he said he

meant, and what he meant he said.

It is no truer that Wall Street--“the Street” _par excellence_--is the

financial center of the Western world than that Mr. Morgan was the

dominant personality therein. He himself was not the Street, for that

term includes the Stock Exchange, a large part of the activities of

which are purely speculative; and at no time in his life was Mr. Morgan

a speculator. Wall Street signifies, and will increasingly signify, as

time goes on, the abiding-place of bankers rather than of brokers; and

it was in the banking world that Mr. Morgan reigned supreme.

The transactions in which he was the chief factor ran all the way up

to the more than $1,400,000,000 capital of the United States Steel

Corporation. The total amount involved in his organizations and

reorganizations of railways, industrial concerns, and public utilities,

and his flotations of American and English government bonds, was

thousands of millions of dollars. Never has one man exercised such

control over the accumulated wealth and undeveloped resources of a

great country. The power appeared to be despotic, but if it really

was so, the despotism was so tempered by probity and a high sense of

responsibility as to lose all the terrors the term usually connotes.

An old friend, a banker in close touch with many of Mr. Morgan’s most

important operations, was asked the secret of his success. “There was

no secret about it,” said he. “I think his chief asset was integrity.

Of course, being honest doesn’t make a man rich. He must have--as

Mr. Morgan had--immense energy and ability. But a man in the banking

business can’t make a great success with these qualities alone. At

the ‘Money Trust’ inquiry it was shown that the Morgan house had more

than a hundred million dollars on deposit; and this was by no means

high-water mark. Probably these deposits have been twice as great, at

times. Now, no matter how brilliant a man is, people don’t put more

than two hundred million dollars in his hands unless they know him to

be honest to the core, as Mr. Morgan was.” When I quoted this to a

clergyman, he said: “That is the business man’s point of view.” “So

much the better for business,” I replied. The president of a great

commercial bank made this confirmatory comment: “Mr. Morgan’s power lay

in his keen sense of trusteeship.”

An intimate friend of Mr. Morgan’s, speaking of the financier’s

mental attributes, remarked that his mind never appeared to work

deliberately, logically, but to attain its results by intuition, as it

were; in other words, he was a man of genius. What the business man

usually lacks is imagination; but imagination was perhaps the largest

element in Mr. Morgan’s mind. It was this that made his actions great.

It was his constructive imagination that made it possible for Mr.

Claflin, President of the New York Chamber of Commerce and himself

a distinguished man of affairs, to say: “Like the founders of this

nation, Mr. Morgan had prophetic vision; like them, he was an organizer

of scattered possibilities and a builder of mighty structures such as

no man had built before.” It was because of his imaginative force that

Senator Root called him “the greatest master of commerce of the world”;

and that Mr. Choate said that “only once in a generation is such a mind

born in such a body.” And it was this that prompted our English kin to

liken him to Cecil Rhodes, to Bismarck, and to Napoleon.

Mr. Morgan’s great gift to Harvard University was made in a way that

illustrates his habitual promptness of decision. He and Mr. Rockefeller

were among those who were asked to contribute to the habilitation of

the Medical School. The latter caused a thorough investigation to be

made, which lasted for six months. At the end of that time he received

a favorable report and was advised to give $500,000. He bettered the

advice, however, by giving a round million. Mr. Morgan’s course was

equally characteristic. When the needs of the school were explained to

him, he made an appointment to see two or three of the professors at

his office. Entering from his private room with his watch in his hand,

he said: “I am pressed for time and can give you but a moment. Have

you any plans to show me?” The plans were produced and unrolled; and

moving his finger quickly from point to point, “I will build that,” he

said, “and that--and that--and that. Good morning, gentlemen.” The cost

was over a million dollars. Mr. Morgan and Mr. Rockefeller had reached

exactly the same conclusion as to the merits of the case and the amount

of his contribution, but by what different methods!

Mr. Morgan’s activities and achievements in the financial field divide

themselves into three main groups: the reorganizing of bankrupt

railways, or railways threatened with bankruptcy; the forming of

great industrial organizations, and the floating of corporate or

government bonds. His chief performance in the last-mentioned line

was the flotation of United States Government bonds in the year 1895,

when, incidentally, Messrs. Morgan and Belmont arranged with President

Cleveland and his Secretary of the Treasury further to protect the

national credit by putting a stop to the menacing outflow of American

gold to Europe.

At the age of seventy, the veteran financier was called upon to render

another great service to the country by organizing and directing the

forces that put an end to the panic of 1907, as noted at the beginning

of this article. His efforts at this trying time won the gratitude and

applause of all right-thinking men. Yet, five years thereafter, in the

spectacular search for a bogy popularly styled the “Money Trust,” he

was put upon the rack by a congressional committee and subjected to a

prolonged quizzing. To a man so proud, so shy and so sensitive, the

ordeal was a dreaded one, but he had made no attempt to evade it. In

the end, it afforded him an opportunity of bearing emphatic witness

that personal integrity is the basis of all credit. The tonic effect

of this testimony was felt from one end of the land to the other, and,

had the witness been a younger man, his gratification would have much

more than outweighed the strain upon his nervous system. As it was, his

friends do not attribute to this ordeal his collapse a few weeks later,

while on his way to the scene of the excavations in Egypt which the

Metropolitan Museum of Art was conducting at his expense.

Nothing has been said oftener of Mr. Morgan than that he was “a

‘bull’ on America.” One of his old friends disclosed, the other day,

the origin of this “bullishness.” As is well known, Mr. Morgan was an

optimist. His father’s temperament was the same, and the older man

impressed upon his son--when he was returning to America more than half

a century ago, to go into business--his own belief in this country and

his faith in its future. “Any man who is a ‘bear’ on America is bound

to fail,” he said. Coming from the lips of his father, whom during his

life the son leaned on and respected, and whose memory he revered and

honored, these words made an indelible impression on the young man’s

mind; the more indelible as they confirmed his personal feeling and

conviction and, in later years, his experience. As it turned out, his

confidence in the country’s future was a potent factor in its material

prosperity.

Current report has it that once, when Mr. Morgan invited into his firm

a young man who had made a name for himself, he said, “I want you

to come down here and ‘do things.’” Less well known--though as well

worth preserving--is his word to another bright young man, in similar

circumstances. Surprised no less than gratified at the invitation, the

fortunate one exclaimed, “But what can _I_ do for J. P. Morgan and

Company?” “I don’t ask you to make money for us,” was the reply; “but

we have a great many duties and responsibilities here, and I want you

to come in and help us bear them.”

It is related that Mr. Morgan’s father once threatened to withdraw his

power of attorney from the son, if the latter persisted in overworking.

If the warning was given, it probably was heeded; but Mr. Morgan was

always a great worker, though in his later years, at least, he realized

the value of holidays, as is shown in the saying ascribed to him: “I

can do a year’s work in nine months, but not in twelve.” Apropos is the

legend that partnership in the Morgan house meant a short life, if not

a merry one. Undoubtedly, all the members of the firm had their work

cut out for them. It could not be otherwise in a house that stood at

the top and meant to maintain its position. There was an immense amount

of work to be done, and they were there to do it. But they were always

men who liked to work; and the fact is that when a partner died or

retired, it was at an age when death or retirement was not unnatural.

There have been few exceptions to this rule. And one, at least, of Mr.

Morgan’s former partners has survived his chief, though several years

his senior.

Mr. Morgan’s own stalwart physique and capacity for work were an

inheritance from his father, whose death, at seventy-seven, was due to

an accident. Some of his indomitable energy must have come to him from

his maternal grandfather and namesake, John Pierpont; for, when the

Civil War began, that poet, patriot, preacher, and ardent reformer,

after seventy-six strenuous years, had the pluck to enlist as a

chaplain (though for a very brief service) and lived to be eighty-one

years old.

It is recalled that at school Mr. Morgan was a writer of verse, but it

does not appear whether this was due to the example of his grandfather,

one of whose poems on the death of a child--“I Cannot Call Him

Dead”--has gone into the anthologies.

An interesting incident relating to the poet is told me by a friend.

During the Civil War, Father Pierpont (as he was called) was a clerk

in the Treasury Department at Washington, and while there was often a

visitor at the house of Paul H. Berkau, well remembered in Washington

as president of the Schillerbund, a club for the study of German

literature. The Berkaus were abolitionists, friends of Sumner and

Julian, and other men of that faith, and this was a bond between them

and their friend the poet. One day, when he came to see them, he found

on the table a copy of his volume, “Airs of Palestine and Other Poems.”

He took it up and wrote on the fly-leaf these lines:

“Shame! that my book should to my friend be _sold_

Rather than made a present of, or lent;

Sold, too, for _paper_, not so good as gold

By forty-eight or forty-nine per cent.

Jno. Pierpont.

Washington, D. C., 3 Dec., 1863.”

In 1902 one of the owner’s family, coming into possession of this

volume, presented it to Mr. Morgan with this inscription:

This volume, formerly the property of my uncle, Mr. Paul H. Berkau,

to whom the poet wrote the inscription, is respectfully presented

by me to Mr. John Pierpont Morgan, who has done so much to keep our

“paper” as “good as gold.”

Mr. Morgan received the volume with evident delight.

For many years it was Mr. Morgan’s custom to engage a furnished house

in the city in which a general convention of the Episcopal Church was

to be held (he himself being always a lay delegate from New York),

and to entertain therein, as long as the convention lasted, a group

of his particular friends in the episcopate. A private car conveyed

these parties to their destination; and once, when the place of meeting

was San Francisco, a special train was engaged for the long journey.

Mr. Morgan’s guests on these occasions were usually Bishop Potter or

(later) Bishop Greer of New York, Bishop Doane of Albany, the Bishops

of Connecticut and Massachusetts, and the wives or other members of the

families of these gentlemen. The present bishop of New York relates

that once, when some one raised the question of the familiarity of

the members of the party with the services of the church, it proved

that their host was better versed in the collects, the hymns, and the

Shorter Catechism than any of his clerical guests. This only confirms

other anecdotes illustrating the extraordinary retentiveness of his

memory; for, while he was a habitual church-goer, never missing a

Sunday morning service if he was within reach of a church, he could

hardly have attended as many services, in the course of his life,

as the youngest of the bishops present. His similar hospitality and

constant attention to the Archbishop of Canterbury, primate of the

Church of England, during that prelate’s visit to America a few years

ago, caused a wit to speak of His Grace as “Pierpontifex Maximus.”

His devotion to the interests of the church was of long standing. It

showed itself, of course, at Highland Falls, on the Hudson, the village

nearest his summer home; and more conspicuously at St. George’s in

Stuyvesant Square, New York City, where the simple, impressive service

chosen by himself was read at his funeral on the fourteenth of April.

To the activities of this church--a body less distinguished for the

wealth and social prominence of its members than for its work among

the poor--he was for many years a liberal subscriber. The spacious,

well-equipped parish-house commemorated his father-in-law, Mr. Charles

E. Tracy, a former vestryman. And at a time when there was special need

of larger revenues, he made it known that, for a considerable period,

he would duplicate every contribution made by other parishioners. At

the time of his death, he was senior warden of St. George’s, and he

never had missed a meeting of the vestry when he was in New York.

His interest in denominational affairs manifested itself in other

directions. To the building fund of the Protestant Episcopal Cathedral

in Albany he gave handsomely. When subscriptions were first asked for

the building of the Cathedral of St. John the Divine, in New York,

he put his name down for half a million dollars; and to this sum

he afterward added $100,000. At a meeting of a committee appointed

to raise money for a synod house, when he learned that $50,000 had

been subscribed but that $250,000 more was needed, he made himself

responsible for the whole amount, requesting that the earlier

subscribers be relieved of their obligations. Finding, however, that

Mr. Bayard Cutting wished to participate on equal terms in this gift

to the General Convention, he contented himself with assuming one

half the entire burden--which in its entirety proved to be $350,000

instead of the estimated $300,000. Thus his gifts in connection with

the new cathedral amounted to nearly $900,000, and his friends in the

church were not surprised that his will made no further provision

for this great undertaking. Not only at home but abroad was he the

cheerful giver the Lord is said to love, as witness the installation of

electricity in St. Paul’s Cathedral, London, at a cost approximating

$200,000.

The benevolent institution that ranked next to the church in Mr.

Morgan’s regard was the Lying-In Hospital, near St. George’s Church, in

Stuyvesant Square. Having bought the house and grounds of the late Mr.

Hamilton Fish, skirting Second Avenue from Seventeenth to Eighteenth

Street, and some adjoining houses, he sent Dr. James W. Markoe abroad

to study the hospitals of Europe, and in due time authorized the

preparation of plans for a model building to cost about $750,000. By

the time these plans had been drawn and specifications had been worked

out, the price of materials had greatly increased, and the estimated

cost proved to be about half a million more than was expected. Instead

of abandoning the project, or waiting for prices to decline, or

demanding a drastic revision of the plans, Mr. Morgan’s word was, “Go

ahead--and cut out nothing.” When the hospital was built and thoroughly

equipped, Mr. Morgan made up for the city’s inadequate annual

contribution to this great charity by giving $100,000 a year toward its

maintenance.

Harvard University, especially the Medical School; the Art Museum at

Hartford, founded in memory of his father, Junius Spencer Morgan of

London; the New York Trade School, which he handsomely endowed; the

American Academy in Rome, and the Loomis Sanatorium were the other

chief beneficiaries of his discriminating bounty. But the institutions,

causes, and individuals (many of the latter personally unknown to him)

that were indebted to Mr. Morgan for substantial aid, at one time or

another, were innumerable as the autumnal leaves of Vallombrosa. Many

of his benefactions were not publicly recorded, and if he recollected

them himself, it was only because his memory was incapable of relaxing

its grasp on anything, large or small, that had once entered it. As

the London “Spectator” said, never was there a millionaire so set upon

effacing his name from his deeds of beneficence.

Mr. Morgan’s connection with the Metropolitan Museum of Art dated

from 1871, when the institution was organized. For twenty-five years

he was one of the trustees, and since 1904 he had been president. He

took an intense interest in its upbuilding, contributing thereto not

only of his wealth but of his time and affection. So conspicuous was

his identification with the art museum that it obscured his relations

with the American Museum of Natural History, on the other side of

Central Park. Yet these were equally close and well-nigh as important,

involving forty years’ activity as a trustee and long service, first

as treasurer and again as vice-president. Here, too, his gifts were

lavish. His love of beauty showed itself in the presentation to the

museum of large and choice collections of minerals and precious stones;

but these were only a small part of his contributions, which included

money for endowment, maintenance and research, as well as innumerable

objects for exhibition.

Owing largely to modern facilities for travel and communication, the

personality of the American Mæcenas was probably better known in

foreign countries than that of any private citizen of the past. He was

a very familiar figure in England, where he succeeded years ago to the

headship of his father’s firm, as well as to the ownership and yearly

occupancy of his father’s town house and country-seat; where most of

his collections were kept for many years; and where his gift to St.

Paul’s Cathedral showed his lively interest in the Church of England

and in the City of London. He was equally well known in France, where

he was the head of a banking-house and a benefactor of his favorite

health resort, Aix-les-Bains; in Germany, where his presentation of an

important letter of Luther’s to the Imperial Government was heartily

appreciated; in Italy, where he endeared himself to Pope and people by

the restoration of the cope of Ascoli, and where his last hours were

passed; and finally in Egypt, the antiquities as well as the climate

of which had an attraction for him that grew constantly stronger.

Moreover, his fame as a collector made him an object of intense, if not

altruistic, interest in the various lands in which he sojourned.

Having achieved an international reputation as a maker of money for

his clients and customers, as well as for himself, Mr. Morgan found

no less pleasure, but rather more, in making a new and quite as wide

a reputation as a spender. His collections were made _en prince_. He

never haggled over a bargain, but took a thing on the seller’s terms

or left it. When he declined a book, a manuscript, or an object of

art at the owner’s price, he must have been aware that that price was

exorbitant; for his purchases were made with an open hand, many of

them at figures that somewhat discounted the appreciation in values

when competition should have become even keener than it was when he

entered the field. His activities as a buyer doubtless caused a

general rise in the price of rarities--an inevitable result of the

rather rapid making of a collection that has recently been insured for

$23,000,000 and would probably fetch a much larger sum if disposed of

under favorable conditions. In estimating the commercial value of such

a collection, it must be borne in mind that the number of masterpieces

is virtually fixed, while the number of potential competitors for their

possession continually increases.

When Mr. Morgan bought the house adjoining his father’s former home,

No. 13 Princes Gate, London, joined the two, and filled the addition

with things for which there had been no space before--having a room

especially designed to hold the series of Fragonards; when he left in

the National Gallery the Colonna Raphael, for which he had given a

hundred thousand pounds or so; when he filled case after case in the

South Kensington Museum with priceless treasures, he had no prevision

that by far the greater part of his collections would be coming,

before long, to New York. Their departure did not follow hard upon the

passage of the law exempting from tariff charges works of art more than

twenty years old. But when Mr. Morgan learned, last year, from Mr.

Lloyd-George’s own lips, that if he should die while his collections

remained in England, his estate would have to pay $300,000 or more on

the Raphael alone, he promptly arranged to transfer his treasures to

his own country, where the death duties are less onerous. And now that

they are safely arrived, word comes, through his will, that in due

time they may become permanently accessible to the American people.

Already the literary treasures, safeguarded in the exquisite library

building adjoining his house in Thirty-sixth Street, are accessible to

accredited students and amateurs; hundreds of his art works--paintings,

porcelains, carvings, tapestries, etc.--are on view in the Metropolitan

Museum; and only the erection of a suitable building (presumably in the

form of an addition to the museum itself) delays the revelation of the

full extent of the rich and varied collections the acquisition of which

gave so keen a zest to the financier’s later years.

Of Mr. Morgan’s many activities, he enjoyed none more keenly, and found

none more beneficial, than yachting. As many days and hours as he

could spare, he passed aboard his steam yacht, the _Corsair_, often

spending the summer nights in New York Bay or on Long Island Sound,

early in the week, and running up the Hudson, to his country home, for

the week-end. Longer trips were made to Newport or Bar Harbor--with

the New York Yacht Club, when its annual cruise was on; at other

times with only his personal guests. From 1897 till 1899, he was the

club’s commodore; and his hand went deep into his pocket to build the

_Columbia_, which defended the _America’s_ cup in the last of these

years, and was used as a trial boat in 1901, when _Reliance_ was the

defender. The _Corsair_ of 1891 (a 242-foot boat) was sold to the

Government, as other yachts were, when we were at war with Spain, in

1898. As the _Gloucester_, under Captain Wainwright, she gave a very

good account of herself at Santiago. That year the _Sagamore_ served

as flagship; but on the very day the Commodore sold the _Corsair_ he

had commissioned her designer, Mr. J. Beavor Webb, to build a boat

sixty-two feet longer than the old one; and the next year the new

_Corsair_ was launched.

Mr. Morgan’s private signal was known in Europe as well as in home

waters, though he never crossed the ocean on anything but a great

liner, usually the flagship of the White Star Line. This line--the

chief subsidiary of the International Mercantile Marine Company, one of

his many organizations--was in a sense his pet; and the sinking of the

_Titanic_, in whose construction he had taken the keenest interest, was

probably a heavier blow to him than to any one to whom it did not bring

personal bereavement.

Mr. Morgan’s great liking for collies is known to all lovers of dogs,

and the Cragston kennels are decorated with many a first prize won at

the Madison Square Garden and elsewhere. As a rule, the animals, young

and old, are confined to their own quarters, well away from the house,

and separated from the house grounds by the public road that runs along

the bluff on the west shore of the Hudson at this point. Despite the

comfort, not to say luxuriousness, of their surroundings indoors, they

are always overjoyed to be let out; and one of their owner’s keenest

pleasures was to see them released; to watch them dash, in a pack,

to the gateway, turn sidewise in the air as they sprang through, then

tear like mad down the road in the direction of Highland Falls and West

Point, yelping as if possessed. After running a few hundred yards, they

would turn as suddenly as they had started, and race back, passing the

gate at full speed, and dashing another hundred rods or so, before

turning again.

“Sefton Hero,” or some other great prize-winner, was likely to be seen

about the house in the daytime; but to only one collie was granted

the privilege of permanent occupancy. This was a dog that had been

in the habit of running down the private road to meet his master on

the arrival of the yacht, the private signal of which he had learned

to recognize. One afternoon, in his zealous haste, he failed to see

a railway train that arrived just as he reached the riverside. The

cow-catcher struck him and tossed him many feet, but happily he landed

on a bit of swampy ground with no bones broken. His devotion, with its

almost fatal consequences, won him special privileges for the rest of

his days.

Not long after the completion of Mr. Morgan’s greatest work as an

organizer, he was the chief guest at a dinner of the Gridiron Club, in

Washington--one of those functions where the newspaper “boys” have fun

with the great ones of the earth. It was, of course, impossible to get

him to talk; but leaving the room, late at night, his arm linked in

that of his old friend Mr. George F. Baker, he exclaimed, “If only I

were a speaker, how I should have liked to talk for an hour to-night,

and tell them the story of the organization of the Steel Corporation!”

He may have felt an equally strong impulse to unbosom himself on other

occasions, but if so he repressed it.

An invincible shyness, which seemed hardly consistent with the man’s

dominating forcefulness, made him as sedulous in avoiding publicity as

many are in courting it. On certain occasions it was impossible for

him to escape the spot-light; but when its rays fell full upon him his

discomfort was obvious. Such an occasion was the dedication of the New

Theatre, now the Century. As chairman, it was Mr. Morgan’s duty to

receive the silver key of the building from the architect. For once he

had to take the center of the stage in only too literal a sense. As he

sat there throughout the addresses of Senator Root and Governor Hughes,

alternately glancing at, and crumpling up, the scrap of paper on which

his notes were written, it was an easy guess that the remotest corner

of the attic would have been a preferable place of waiting; and when

his turn came, and he had pronounced his two or three formal sentences,

his relief was evident. Once, when he was called on for a speech, he

said, “No, no, gentlemen; I have never made a speech in my life, and

I’m not going to begin now.”

Now and then a business proposition of minor importance would be

submitted for Mr. Morgan’s approval, which was usually given or

withheld after apparently cursory consideration. If the matter came

up again months afterward, and there was any difference of opinion as

to its details, the recollection of the senior partner, who had given

the thing five minutes’ attention, was invariably found to be more

nearly correct than that of the juniors, who had had the handling of

the business. Once in a way, Mr. Morgan might have occasion to borrow

a small coin. If so, the next time he met the lender, no matter how

many weeks had elapsed, he would recall the occurrence and repay the

loan, as surely as if the amount were a quarter of a million instead of

a quarter of a dollar. A table or a chair not in its accustomed place

attracted his attention; a picture hanging slightly askew disturbed

him. For ten or fifteen years before his death, it was his habit to

play solitaire for a while before going to bed, and he arranged the

cards with the utmost neatness and precision. For his mind was nothing

if not orderly, and disorder in exterior objects disturbed it. When

great affairs occupied it, there was no room for petty details; but

in the absence of matters of moment, its craving for activity had to

satisfy itself with whatever came to hand.

Mr. Morgan’s delicate sense of the fitness of things is illustrated

by an incident related by the young lady who rebound some of the

choicest books in his library. One of these is Geoffrey Tory’s “Book

of Hours” (1525). Into the cover design Miss Lahey wove Tory’s name,

as he himself was in the habit of doing; but Mr. Morgan would not

allow her to reproduce the emblem of a broken jug which the old French

artist had adopted as his sign-manual, using it on every page of his

illuminations. Mr. Morgan’s feeling was that this device was too

personal to the artist himself to be used on any work but that of his

own hands.

The public was surprised at the fervent declaration of religious belief

with which Mr. Morgan’s remarkable document began. It almost appeared

that he regarded his faith as a thing so real, not to say tangible,

as to be transmissible by legal process. Certainly it was fundamental

in his own nature, and as potent a force as any that shaped his

actions. In a noteworthy tribute in the “Outlook,” a former partner

and most intimate friend, Mr. Robert Bacon, late Ambassador to France,

sums up the matter in these few words: “He was a man of faith; not

only religious faith, but faith in the universe, in humanity, in his

country, in his associates, and in the highest standards of honor in

both his public and his private life.”

A giant frame, an iron will,

A mind that sped as lightning speeds,

Cleaving a way for wits less keen--

A man whose words were deeds.

Simple, sincere, accessible

To all that sought; but woe betide

Him who before those piercing eyes

Faltered, evaded, lied!

And yet those eyes, so quick to blaze

And sear, were no less quick to bless;

For strength and courage, in great hearts,

Mate still with tenderness.

Honest, for honesty’s own sake--

Loyal, for so his soul was made--

With one swift glance he chose his ground,

And held it unafraid.

Keen to acquire, to spend, to give,

Ardent in all things, small in none,

He joyed and sorrowed, lived and loved

And toiled till his task was done.

J. B. G.

[Illustration]

MAURICE MAETERLINCK

BY STEPHEN PHILLIPS

In the February number of “The Poetry Review,” M. Maeterlinck

speaks of the editor of that magazine as “le bon poète, Stephen

Phillips, dont je suis admirateur, fervent et fidèle.”--~Ed.~

Master Mystic over Europe

Whom we did not gladly hear,

Now a sweet revenge thou takest

In the stubborn Saxon tear.

Murmuring of the bees about thee,

With a flight how like thine own,

Upward due to utter heavens,

Happy, be the flight but flown.

Standing half-way between two worlds,

All a-dream, yet dreaming true,

Lord of shadows, yet of shadows

Passing to a perfect blue.

All the ghosts that throng thy pages

Are more real than living wights,

All our noontides are not brighter

Than the brightness of thy nights.

What the dumb moon saith in splendor,

Or the husky bird at dawn,

Thou with human note expressest

Of our murmured fate forlorn.

What the sea would say to sunrise,

Memories of a speechless wind,

This thy muffled muse suggested,

All we seek yet never find.

Yet, forsaking lovelier fancies,

In thy Monna Vanna tale

Thou couldst grip a sterner story,

Hold us fast and leave us pale.

Still the wings we are not ’ware of,

Voices that we dully hear,

Spirit-music struggling downward,

Thou dost bring us dimly near.

I, detained in this ill island,

Where her mist the singer bars,

Hail thee angel of a twilight

Trembling momently to stars.

[Illustration]

[Illustration: TOPICS OF THE TIME]

SOCIALISM IN THE COLLEGES

THE RESPONSIBILITY OF EDUCATORS FOR THE GROWTH OF REVOLUTIONARY OPINION

Simon-pure Socialism is so ugly, so red in tooth and claw, that to

be hated it needs but to be seen and understood. Yet there are so

many dilutions of Socialism on the market, emotional adulterations

and attenuations of the genuine brand, that the inexperienced seeker

is pretty sure to have a mixture far below full strength palmed off

on him, and after tasting he will be likely to say that the stuff is

not so bad, after all. Socialism is offered in the guise of bland and

salutary reforms; it takes the form of ethical standards, of social

justice, of uplift, and of progress and happiness for all; now it is

the shield that guards the poor and the helpless against the shafts

of undeserved ill fortune, and now it stays the hand of the heartless

oppressor. In its assumptions it is the Ten Commandments, it is the

Sermon on the Mount, it is Christianity. Can we wonder that in these

disguises it disarms suspicion and wins a tolerance that is already a

half-way approval?

It is time that the men and women of this country awoke to an

understanding of the true nature of Socialism, of what it is, what

it aims to do, and how it seeks to achieve its ends. Socialism is

revolution, it is blood, it is overthrow, spoliation, and a surrender

of the priceless conquests of civilization, an extinction of the noble

impulses that have raised mankind out of the condition of savagery.

It is time these things were known and understood, we say; it is

time that foolish misconception gave way to clear knowledge, because

Socialism is everywhere sowing its seeds, because it is spreading in

the land, not insidiously, but by an open propaganda; because the

principles of Socialism are taking hold upon the minds of youth through

teaching permitted, or in the name of “academic freedom” actually

encouraged, in our schools, colleges, universities, and even in

theological seminaries. And it is only here and there that from some

chair of instruction a voice is heard proclaiming the truth about

Socialism, examining its foundations, subjecting its system and its

principles to the test of reason and common sense, and picturing forth

in the clear light of experience the consequences of substituting them

for the existing social order. Having permitted this poison to be

instilled into the minds of their students, it is the belief of men

who have observed with growing apprehension the spread of Socialistic

belief, that the country’s institutions of learning will be false to

their duty if they fail to supply the antidote by establishing courses

of instruction in which the fallacies, the falsehoods, and the dangers

of Socialism shall be combatted by competent analysis in the light of

history and economic truth.

No board of trustees, no faculty, can plead an excusable ignorance as

to what Socialists intend. They differ as to plan and method, but they

are agreed upon this foundation article of their faith:

The Socialist program requires the public or collective ownership

and operation of the principal instruments and agencies for the

production and distribution of wealth--the land, mines, railroads,

steamboats, telegraph and telephone lines, mills, factories, and

modern machinery.

“This is the main program,” says Morris Hillquit, and it “admits of

no limitation, extension, or variation.” The Socialist program means,

then, the abolition of private property in land and in investments, the

abolition of rent, profits, of the wage system, and of competition.

Some Socialists advocate confiscation by taxing at full value--for of

course Socialism aims at full control of the powers of government;

some, like the Industrial Workers of the World, would have the

wage-earners take forcible possession of the factories and operate

them for their own account; others would make a pretense of payment,

while still others preach direct seizure. All agree that the land

and the instruments of production and exchange must be taken out of

the hands of private owners and transferred to the State, and assent

to that foundation doctrine makes every Socialist a revolutionist.

Obviously, it is a revolution that could succeed only through violence

and bloodshed, but the real Socialists do not shrink from that

extreme. “The safety and the hope of the country,” said Victor Berger,

the Socialist member of the last Congress, “will finally lie in one

direction only--that of violent and bloody revolution.” He advises

Socialists to read and think, and also “have a good rifle.” But the

literature of Socialism supplies proof upon proof that the capture of

the Government and of property is to be effected by violence. Hence

the Socialist’s hatred of the Army, of the Navy, and of the National

Guard; hence his detestation of all manifestations of the sentiment of

patriotism.

Indeed, one of the noblest expressions of that sentiment which our

literature affords may serve as a complete demonstration of the

conflict between the doctrines of Socialism and some of the convictions

that have struck their roots deepest in our common life. The familiar

lines of Fitz-Greene Halleck’s “Marco Bozzaris” admirably serve the

purpose:

“Strike, for your altars and your fires;

Strike, for the green graves of your sires,

God, and your native land!”

Our “altars” are the symbol of our religion. “No God, no master,” is

the cry of the Socialists, and it was only after a prolonged debate

that a repudiation of religion was kept out of the Socialist platform

of 1908. Our “fires” are our homes and hearthstones. Socialism would

destroy the home. The revolting doctrine of promiscuity was applauded,

and applauded by young women of the faith, at a recent meeting of

Socialists. “The green graves of your sires”--those words should remind

us that the earliest form of title to land was the right to inclose the

graves of parents and kindred. Socialism permits no private ownership

of land. “God, and your native land”--Socialism denies the Creator and

puts the red flag above the Stars and Stripes. Could the grim meaning

of this hideous creed be brought more directly home to the minds and

hearts of American youth than by the evidence that it is a cold-blooded

negation of the fine and lofty patriotism of Halleck’s adjuration?

Yet American youth by thousands are to-day under Socialistic teaching

and conviction. In December, 1912, the Fourth Annual Convention of

the Intercollegiate Socialist Society was held in New York. It was

reported that there were fifty-nine “chapters” of the society in as

many colleges and universities, including all the leading institutions

of the country, and eleven graduate chapters. There were between 900

and 1000 members of the undergraduate chapters, and 700 graduate

members. The list of “enthusiastic disciples of Karl Marx” among

college faculties includes the names of many professors of national

repute. Socialism is at work, too, in the schools, and it has schools

of its own, and in this city its “Sunday-schools.” The doctrines are

put before children and youth not as doctrines of destruction and

confiscation, and of revolution by violence and bloodshed, but as

principles of ethics, of social justice, and the common good, all

leading up to the beautiful dream of the brotherhood of man. College

students are asked to consider the working of some privately managed

undertaking, and then by plausible illustrations it is pointed out

to them that the State could perform the service much better, and

thus the ground principle of Socialism gets a lodgment in minds

insufficiently informed to detect the falsity of the teaching. In the

children’s schools is used “The Socialist Primer,” in which by text

and pictures hatred of the rich and well-to-do is implanted, and the

workingman is presented as the helpless victim of greed and cruel

oppression. The facts of Socialism, the truth about Socialism, are open

to ascertainment by every college and university trustee, by every

president, by every giver of funds whose benefactions are employed in

part to support the teaching of this devil’s creed that is to supplant

our old-time reverence for the altar, the hearth-fire, the family, the

graves of kindred, and the flag. There is no vital difference between

Socialists. The revolutionaries of the Haywood and Debs type and the

evolutionary Socialists of the college faculties have virtually a

common faith, and tend inevitably to the acceptance of one method for

its attainment.

Is this teaching of revolution and confiscation to go on? A sound

course of instruction devoted to the exposure of the fallacies, the

falsehoods, and the destructive purposes of Socialism in every college

where it has gained a foothold, would make the student immune to

its poisonous delusions. Truth is the natural shield against error,

yet only here and there has its protection been extended over the

endangered youth of our colleges. The teaching of false history and

false science would not be tolerated anywhere. Is it less important

that young men should be safeguarded against false teaching in matters

that go to the very groundwork of their morality and their citizenship?

The trustees, presidents, and faculties of the country’s seats of

learning have a duty to perform that they cannot longer neglect without

inviting the sternest censure of public opinion.

THE MONEY BEHIND THE GUN

In “The Flower of Old Japan,” a poem “for children between six and

sixty,” Mr. Alfred Noyes represents his child seekers for the mirror of

wisdom as encountering, among other personified phenomena of the adult

intelligence, a curiously-inclined people known as the Ghastroi, of

whom he says:

“Their dens are always ankle-deep

With twisted knives, and in their sleep

They often cut themselves; they say

That if you wish to live in peace

The surest way is not to cease

Collecting knives; and never a day

Can pass, unless they buy a few;

And as their enemies buy them too,

They all avert the impending fray,

And starve their children and their wives

To buy the necessary knives.”

The children are quite at a loss to know what to make of such a strange

way of life.

Many children of a larger growth have wondered at the phenomenon of

the actual world of which Mr. Noyes’s fancy is an allegory. But in the

cultivation of the fear of war it has been left for the present year

to reveal an aspect of sordidness the like of which has never before

been known.

The world was startled, and all Germans were overwhelmed with

mortification and shame, when in April the facts were made known

concerning the way in which a market for military supplies had been

created at Berlin. One great manufacturer of guns had been guilty of

giving bribes within the very walls of the War Office. Another large

company dealing in arms and ammunition had sent money to France in

order to hire writers of anti-German articles, so that warlike feeling

might appear to be stirred up, and the German Government be induced to

place large orders for rifles and cartridges. All this went far beyond

the ordinary manipulation of a “war scare.” With that we are familiar.

It has frequently been seen in the United States. More than twenty

years ago, when there was foolish talk about a war with Chile, a New

Jersey steel-maker was heard to say, after the flurry was over, “Well,

anyhow, it was a good enough war to secure me an order for $600,000

worth of ship’s plates.”

Such tactics by armor-makers and powder-manufacturers have often been

exposed, but they fall short of the fiendishness of these German

plottings. It is bad enough to work up an artificial excitement in

your own land, to form leagues for a bigger army and navy, to point to

various alleged foreign “perils,” to ply committees of Congress with

fantastic military arguments, and to do it all, and finance it all,

solely in order to get some fat government contracts. But to do what

the German firm did is to pass beyond the mischievous and dishonorable

into the diabolical. Deliberately and by means of money sent abroad to

seek to rouse a hostile spirit and provoke a war for the purpose of

making the weapon business good--this is to be willing to coin money

out of the misery of two nations. It is to take the position that the

blood of the killed and wounded and the tears of widows and orphans

may be ignored if only they are “good for trade.” We have heard much

of the mad competition in armament being a reduction of militarism

to the absurd. These German revelations are a veritable _reductio ad

horribilem_--all the more shocking because the German Emperor is to-day

one of the greatest forces for peace.

Yet, when all is said, is not this thing, which the moral sense of

civilized men pronounces shocking, only a development, one may say

a logical development, of practices which have long been known and

tolerated? There would seem to be only a difference in degree of

turpitude between bribing one’s way to an order for cannon and paying

out money, directly or indirectly, to secure general legislation which

means money in a private citizen’s purse. This latter process has been

not merely winked at in this country; it has been thought the regular

and reputable thing to do. It has almost been honored. At least those

who have profited by it have been honored. For years it was the vicious

custom of corporations to group under “legal expenses” sums paid out

to influence the legislature or Congress. Of one man prominent in his

party, long in public life, and influential there, it was said that his

motto, in politics as in business, was, “If you want anything, go and

buy it.”

Such things were once far too common. They are frowned upon now, and

we may believe that they are passing. It is necessary only to refer to

what was done year after year in the matter of the protective tariff.

The relation between campaign contributions and desired rates in the

tariff bill was so close that it was hardly an exaggeration to say that

the manufacturer put his coin in the party-treasury slot and drew out

the customs duty he wanted. It seems certain that this habit of the

“good old times” is disappearing before the spirit of the better new

time. Yet evil is persistent. It is protean and recurrent. With all the

gains that have been made, it is still true that the pecuniary view of

legislation is too often met with. We laugh at “going in for the old

flag and an appropriation,” but there are ways of corruption subtler

than the blatant patriotic. In connection with too many bills and

projects of law the questions are yet asked, “What is there in it for

me?” “Who is putting up the money for this?”

Cases of outright legislative bribery are rare. In the few that do come

to light or are suspected, proof of guilt is exceedingly difficult--how

difficult, recent events at Albany have shown. But it is not the

coarse methods of the purchaser or huckster in legislation that we

need to guard against so much as the more insidious forms of swaying

public legislation to private advantage. Too often, in connection with

projects of law, a distinct “interest” appears. And frequently it is a

moneyed interest. Movements that are artfully given the appearance of

being spontaneous or voluntary are discovered to be secretly financed

for secret purposes. The press is sometimes approached as well as

legislatures and Congress. Sinister ends are craftily disguised. The

very elect are occasionally deceived.

What is the remedy? It must be mainly moral. Against these anti-social

practices the full power of social condemnation must be massed. The

senses of men need to be sharpened until they can deny the truth of the

cynical saying, “Gold does not smell.” Some gold does. And as against

a private “interest” in legislation, there must be asserted, as the

one standard, a broad State or National interest. Lacking that, no

bill should be exempt from the severest scrutiny to expose a possibly

selfish backing. That general principle established, and the further

truth being insisted upon that no man shall be permitted before a

legislative or congressional committee to be a judge in his own cause,

the motive and the mischief of money-prompted legislation would be

greatly diminished.

ONE WAY TO MAKE THINGS BETTER

THE FUNCTION OF HIGH STANDARDS IN LITERATURE AND THE ARTS

At first thought, it seems like mockery to recommend to a world of

social unrest and of shifting ideals, a world that for the most part

is struggling for three meals a day, the efficacy of music, letters,

and art to ameliorate its condition. “Emerson in words of one syllable

for infant minds” will not reach below a certain intellectual stratum.

Beethoven for the people seems a contradiction of terms. There are

times when, despite the crowds at the museums, Michelangelo and the

Greek marbles seem to have as little influence upon the stream of

humanity as rocks upon the current of a river that flows past them.

The cry for the elevation of the race, which is the dominant note--the

Vox Humana--of our time, the hope that we may all move up together,

is a logical development of the Christian idea and the most creditable

aspect of the new century. The whole world is reaching for sun and air.

The ambition of the wage-earner is a counterpart of nature, as Lowell

reads it into his “June”:

“Every clod feels a stir of might,

An instinct within it that reaches and towers,

And, groping blindly above it for light,

Climbs to a soul in grass and flowers.”

With the impetuosity and the lack of discipline of our day, this

aspiration often overreaches itself. The highly stimulated desire for

advancement is thwarted by unwillingness to take the plodding and the

stony road. The treasures of the humble are forgotten. The quick fire

burns up the substance and leaves but ashes. Meanwhile, it is something

if, with Landor, we have

“warmed both hands against the fire of life.”

But, with all this impatience to “get culture,” and this rush to take

beauty and intellectual resources to those who have them not, as food

to the famine-stricken, we are in danger of forgetting the chief

value of the best in literature and the arts: that _it awakens the

imagination and gives poise to life_. Now, imagination and poise are

two traits that differentiate man from the brute, and the superior man

from the inferior. The best thinking is done by men of imagination;

the best action is accomplished by men of poise; for, by poise is

meant the faculty of holding one’s course courageously to the compass

among contrary winds and waves. The value of high literary, artistic,

and musical standards is not that they make poise and imagination

universal, but that they affect the world secondarily, through the

leaders in whom these qualities are developed. Who shall compute the

worth to humanity of one great thinker, one great novelist, one great

poet, one great painter, one great sculptor, one great composer? In

debating societies, great material advances through invention and

discovery are weighed in the balance with great achievements in arts

and letters; but account is seldom taken of the intellectual forces

that created the inventors and the discoverers.

It is because America is in need of great men that she stands most in

need of these forces. The twentieth century appears to be a century

of challenge to all the centuries that have gone before, with the

accelerated momentum of them all. Now, more than ever, must we have men

of imagination and men of poise, and every agency that gives promise

of developing these traits deserves encouragement and support. The

uplifting of the people to a high average of happiness is thus closely

though indirectly related to the advance of literature and the arts.

COMMENTS ON “SCHEDULE K”

In the paper on the tariff as applied to woolen goods, by Mr. N. I.

Stone in the May ~Century~, it was stated: “The great factor in

the woolen industry to-day is the American Woolen Company, popularly

known as the Woolen Trust, which was said to control sixty per cent. of

the country’s output at the time of its formation in 1899.”

Mr. Winthrop L. Marvin, secretary of the “National Association of Wool

Manufacturers,” in a letter to ~The Century~ says: “The American

Woolen Company makes annual reports. Its capital stock in 1899 was

$49,501,100 and in 1909 it was $60,000,000. The total capital of the

woolen and worsted industry of this country, as stated by the Federal

Census, was, in 1899, $257,000,000 and in 1909 it was $415,000,000.

The output of the American Woolen Company in any given year has been

at a maximum $51,000,000. The total output of the industry in 1899 was

$239,000,000 and in 1909 it was $419,000,000. These figures controvert

the assertion of ‘sixty per cent.’”

Mr. Marvin also states that while the Tariff Board mentioned duties on

certain English cloths as being “from 132 to 260 per cent.,” it also

made plain that those very high rates were not actually effective,

since American competition operated to reduce the tariff cost to

an average of 67 per cent., “embodying the higher cost of American

materials and labor.”

--~The Editor.~

[Illustration: OPEN LETTERS]

ON ALLOWING THE EDITOR TO SHOP EARLY FOR CHRISTMAS

_Counsel to a Literary Aspirant who Wishes to Enrich the Yuletide_

_Dear Chalmers_:

For years you have made no secret of the fact that you were studying

Editors,--root and branch, genus and specimens. I know that you have

diagnosed and pondered their little infamies, one by one. I know that

you have pored over gossip of their habits and wiles--as chronicled by

Sunday newspaper articles. I think I am not exaggerating when I surmise

that you feel you know the tribe--analytically speaking--through and

through.

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And yet--and yet--you confessed to me not more than a month ago, with

chagrin in your voice, that you have never dared attempt a Christmas

story. Frankly, my friend, I was, and still am, surprised. You have

been successful in more difficult things, yet you balk at a mere

Christmas tale. I’ve thought about it so much that I am finally taking

the liberty of sending you this letter, which you may, if you choose,

regard as a monograph on “How to Write a Christmas Story.” As I have

just sold my ninety-eighth tale of Christmas, I think you will allow

that my counsel deserves some consideration.

First of all: be kind to the editor. Don’t put off sending him your

story till the eleventh hour; but give him his chance to shop early. It

is not his fault that his Christmas purchases have to be made before

Labor Day. Therefore be considerate.

Spring is, of course, the best season to begin to think of tuning up

for your December fiction. In any case, between the time the first

dandelion shows its head and the end of July it is essential that you

should tear yourself away from the play you are working on and oil your

typewriter preparatory to the Christmas story. That accomplished, your

task is all but finished. The only thing that remains before mailing

off your tale of the Yuletide is to write it--a mere formality.

Of course you have to choose which Christmas story you will write. But

that is a bagatelle. Fortunately the stereotyped varieties have become

as easily classified as the different sorts of evergreen. A row of

mental pigeonholes will contain the stock formulas. You have only to

reach in and draw one out. Roughly speaking, the tales may be divided

into those of the city and the country.

One favorite is the crusty millionaire story. You should make him

a second Crœsus, dyspeptic, with a heart of flint. He bullyrags

his servants unmercifully, and has no kind word for any one. He gets

no happiness out of life, and will not permit anybody else to get

any. Such carking selfishness is easily worth three thousand words.

Then comes the great transformation scene, with incidental music of

Christmas bells. A little child, a faithful old servant, the woman he

did not marry:--one of these is the agent who sets him to giving away

his money with both hands and--so we are led to believe--cures his

indigestion.

If you have no fancy for this story, why not select the regeneration of

the hardened man about town? He is irreproachably dressed, unspeakably

bored, illimitably cynical, and inexpressibly selfish. The rise of

the curtain finds him kicking some little dog that gets in his way.

It is night. He wanders through the town in melancholy irritation.

Then the story should run thus, to put it like an old-fashioned

playbill of the melodrama: SCENE 1. Night in a great city.--Heartless

Jack Mortimer.--The beggar repulsed.--The snow-storm.--The weeping

newsboy.--“I haven’t any Christmas present for Mother!”--Jack Mortimer

touched. SCENE 2. The slums.--The brutal policeman.--The comic

washerwoman.--The garret.--“Hush, my child, there’s not so much as

a single crust in the house.”--The arrival of Jack Mortimer.--The

Christmas tree.--“God bless you, sir, you’re a real gentleman!”