Vice-President of the Richmond & Danville and Richmond Terminal, and a
Director in all the roads in this system. He was born in Charleston, S.
C., about 44 years ago. He served with distinction in the Confederate
Army, and rose to be a Brigadier-General, being one of the youngest in
the service. He is a graduate of the University of South Carolina, and
formerly practiced law in Richmond, Virginia, where he is also engaged
in extensive manufacturing and mining enterprises. He resides in
Richmond, and is a member of the Westmoreland Club, but often comes to
New York on railroad business, in which he has amassed a comfortable
fortune.
John W. Garrett’s name will always be associated with that great
property, the Baltimore & Ohio, which he rescued from the verge of
bankruptcy. He was a man of great force of character, and inherited an
aptitude for business. He was a graduate of Lafayette College in
Pennsylvania, and engaged in business in Baltimore. He became a Director
of the Baltimore & Ohio Railroad, and in 1858 was elected its President.
He was a staunch supporter of the Union in the civil war. Despite a
disloyal sentiment plainly noticeable in Baltimore and elsewhere in
Maryland, he lent the Government all the assistance in his power in the
transportation of hundreds of thousands of Federal soldiers. He was
quick to repair burned bridges, and to do anything to facilitate the
military operations of the Federal Government. President Lincoln and
Secretary Stanton thanked him warmly. His salary as President was
$10,000 a year. The Directors repeatedly offered to increase the
remuneration, but he declined to accept it. He often refused offers as
high as $50,000 a year to become the President of other roads. He was
autocratic in his administration. His will was law. He found the
Baltimore & Ohio Railroad a weak and struggling underline in the
railroad world, and he left it a giant in the American system of
railroad transportation.
Robert Garrett, the son of the preceding, and now the President of the
Baltimore & Ohio Road, is one of the railroad kings of the United
States. He became the President of the Baltimore & Ohio in his
thirty-seventh year, after having served as Third Vice-President and
First Vice-President under his father’s administration. He is a graduate
of Princeton, a man of genial characteristics, and a favorite in
society. He has made a study of railroad administration, but is now
understood to seek some relief from the burdens unavoidably incident to
his position as the head of a great railroad. And he is wise. He is many
times a millionaire. Why should he devote his life to unnecessary care
and labor? Rich men in this country are apt to work too hard. They do
not enjoy life as men of far less wealth do in Europe. Under almost any
administration the Baltimore & Ohio Road has a great future before it.
The road was built to draw the Western trade to Baltimore. This trade
had been diverted from that city by the building of the great canals.
New York & Philadelphia were receiving the lion’s share of the traffic.
The first stone on the Baltimore & Ohio Road was laid by Charles
Carroll, one of the signers of the Declaration of Independence, in 1828.
The road was opened to Wheeling in 1853. The firm of Robert Garrett &
Sons was established in 1849, and was originally engaged in the
wholesale grocery trade. When the road reached Wheeling its finances
were at the lowest ebb. The house founded by the grandfather of the
present head of the road bought largely of its bonds at a very low
figure, and this marked the first connection of the Garrett family with
this great property. The house of Garrett & Sons still exists as a
banking establishment under the management of T. Harrison Garrett. In
1853 Baltimore & Ohio stock could be bought for a song. Since then it
has sold at as high as $225 a share. The improvement in the property was
very largely doe to the efforts of John W. and Robert Garrett.
The recent embarrassing complications of Mr. Garrett in connection with
the management of his railroad and telegraph companies, it is hoped,
will only be temporary, and I expect to see him again, at no distant
day, reinstated at the head of the great corporation over which he and
his father presided. His present difficulties are matters of current
newspaper record and comment, and I need not, therefore, enlarge upon
them here. As shown by the latest report, the Baltimore & Ohio Railroad
is virtually in a good, prosperous and solvable condition, and I have no
doubt that the Drexel-Morgan syndicate which has undertaken to put the
property on a still more solid and durable basis with the ten million
loan which it has negotiated, will uprightly do its whole duty, and in
due time return the trust considerably enhanced in value to Mr. Garrett,
his heirs and assigns.
John H. Inman, another member of the Southern railroad circle, was born
in Tennessee. He is tall, fine looking and soldierly in appearance. He
is one of the shrewdest of the capitalists who have invested large
amounts in Southern enterprises. He came to New York from Atlanta, quite
poor, after the civil war. In the war he was a quartermaster’s clerk,
and his old quartermaster afterwards became one of his brokers on the
Cotton Exchange. Young Inman went into the office of an uncle on
arriving in New York, and learned the business of a cotton broker. He
was clear-headed and successful. After he became a partner in the firm
he added very materially to his wealth by carrying cotton for the
premiums on the options. He is recognized as one of the leaders of the
Cotton Exchange. In recent years he has become a financier, has made
large loans to railroads in the South, and has invested heavily in
Atlanta real estate, and in iron enterprises in Birmingham, the rising
Southern market. He was prominent in the reorganization of the Richmond
& Danville railroad system, in which he is largely interested. He is a
director in the Richmond Terminal and associate lines, as well as the
Louisville & Nashville and other Southern roads. He invested nearly two
millions in the Tennessee Coal & Iron Company. He is now about 50 years
of age. He seems to be a man of destiny. He is a man of great force of
character and exceptional business skill. He resides in New York, and is
possessed of a large fortune.
ANCESTRY IN ENGLAND—BRAINS IN AMERICA.
In this country no one cares about ancestry. The spectacle of Mark Twain
weeping at the tomb of Adam is a humorous expression of American
opinions on this general subject of ancestry. To save time he paid his
devoirs to the fountain head without stopping at the Guelphs, the
Tudors, the Bourbons, the Hohenzollerns, the Hapsburgs, or the
Romanoffs. There is no time, if there was any wish in this great
country—shaking to the tread of gigantic business—to inquire, “Who was
his father?” There is only time for such questions as, “What do you
know?” “What can you do?” “How have you succeeded?” Integrity and
ability stand a man in better stead in America than show of purple veins
of Norman blood. Even in the aristocracy (so to speak) of brains,
ancestry in one sense, so far from being an advantage, is apt to be
precisely the reverse. A son of Henry Clay or Daniel Webster can never
hope to attain the lofty pre-eminence of the sire, and suffer by
comparison. Great men do not always have great sons. For one Pitt, the
son of a great Chatham, there are hundreds of sons who intellectually
dishonor great fathers. Brains, intelligence, industry, energy, and
pluck; these are the talismanic words which stand for success in
America, where no ghost of a dead feudalism hovers over the land,
darkening it by its blighting presence. In England the first question, a
silly echo of centuries, is, “Who is his father?” But who are the
nobility? Have they any title as such to the respect of right-thinking
persons? The nobility is running to seed, or rather the once noble tree
is withering and dying; it has borne its fruit and its time has passed
away. In Scriptural language, Why cumbereth it the ground? How many of
the nobility are now worthless roues, habitual seducers, dried up or
half consumed by the fires of passion and debauchery! They are dying as
the fool dieth, with a drunken leer on their shrunken faces and the
stain of dishonor on their escutcheons. The Commons of England will yet
redeem the nation from the thraldom of a worthless aristocracy. America
is the true field for the human race. It is the hope and the asylum for
the oppressed and down-trodden of every clime. It is the inspiring
example of America—peerless among the nations of the earth, the
brightest star in the political firmament—that is leavening the hard
lump of aristocracy and promoting a democratic spirit throughout the
world. It is indeed the gem of the ocean to which the world may well
offer homage. Here merit is the sole test. Birth is nothing. The fittest
survive. Merit is the supreme and only qualification essential to
success. Intelligence rules worlds and systems of worlds. It is the
dread monarch of illimitable space, and in human society, especially in
America, it shines as a diadem on the foreheads of those who stand in
the foremost ranks of human enterprise. Here only a natural order of
nobility is recognized, and its motto, without coat of arms or boast of
heraldry, is “Intelligence and integrity.”
------------------------------------------------------------------------
CHAPTER LI.
ARBITRATION.
HOW THE SYSTEM OF SETTLING DISPUTES AND MISUNDERSTANDINGS BY ARBITRATION
HAS WORKED IN THE STOCK EXCHANGE.—WHY NOT EXTEND THE SYSTEM TO
BUSINESS MATTERS GENERALLY?—ITS GREAT ADVANTAGES OVER GOING TO
LAW.—IT IS CHEAP AND HAS NO VEXATIOUS DELAYS.—TRIAL BY JURY A
PARTIAL FAILURE.—SOME PROMINENT CASES IN POINT.—JURY “FIXING” AND
ITS CONSEQUENCES.—HOW JURIES ARE SWAYED BY THEIR SYMPATHIES.—A
CURIOUS MISCARRIAGE OF JUSTICE BEFORE A REFEREE.—THE LITTLE GAME OF
THE DIAMOND BROKER.
Wall Street has derived great prestige and character from the New York
Stock Exchange. In fact, the Stock Exchange is Wall Street, so to speak,
so much so that if the Exchange moved to any other locality, the latter
would become the new Wall Street, to the utter oblivion of the old,
which would soon be eclipsed and regarded as a thing of the past.
The New York Stock Exchange has distinguished itself in many respects,
but there is probably nothing for which it is likely to become more
famous in history than its solution of the great problem of settling
disputes and misunderstandings by arbitration. Other financial bodies
have tried the same substitute for ordinary law proceedings, but it
would appear that greater success has crowned the efforts of the Stock
Exchange in this particular experiment than any other corporate body.
The large number of cases on record that have been amicably settled by
arbitration within the past few years, in which law would have been
formerly considered indispensable, seem to point to a period, probably
not far distant, when arbitration will be the great and ultimate court
of appeal in the large majority of civil cases. Several considerations
will make it the most popular. It is cheaper, less complicated, not
subject to vexatious delay; it is more equitable, and the members
composing the Arbitration Committees are business men, who are quick to
discern, accurate in perception, sound in judgment and decisive in
drawing their conclusions on business principles.
The expense of arbitration is a mere trifle compared with the enormous
sums swallowed up in litigation.
Transactions involving millions of dollars annually in the Stock
Exchange are made subject to settlement by this method of arbitration in
the event of any difference of opinion arising in any particular case.
Very few instances occur in which there is any necessity to carry the
case beyond the jurisdiction of the Arbitration Committee.
The number of cases actually settled in this way would probably cost
half a million dollars annually if they had to be brought into court, to
say nothing of the incidental expenses, which would amount to as much
more, arising from delay, on the scale of present charges by the legal
profession, even leaving out our own Evarts, who is probably the Boss
charger of the Bar.
The success attending the system at the Stock Exchange, I think, goes
far to prove that the method might be universally extended to the great
pecuniary interest and personal comfort of business men throughout the
country, for the adjustment of their misunderstandings and grievances
among one another.
My object in writing upon this subject has for its basis the hope that
this chapter may catch the eye of some of our great merchants in this
and other large cities, and that it may suggest to those of them who
have not contemplated the subject already, the advisability and
necessity of establishing for themselves a similar method of arbitration
to that which has been so successful in the Stock Exchange, to be final
and without appeal, in their respective business affairs.
Experience has fully demonstrated that trial by jury is in innumerable
instances a signal failure; especially has this been so since what is
known as “jury fixing” has become so common in the courts. The practice
of bribing jurors has now become a secret profession, and is so ably
conducted that it is almost impossible, except in rare instances, to
expose it.
But apart from this vicious and criminal practice of tampering with
juries, there are many other reasons why it is next to impossible, in a
large variety of instances, to obtain justice from an ordinary jury.
Human sympathy plays a very important part in the verdicts of juries
generally. I mean by this, class sympathy. A business man who is
regarded by the community as rich and powerful, can hardly expect
justice from a common jury unless the party opposed to him occupies a
similar station in society. Where the position of either the plaintiff
or defendant calls forth sympathy with regard to worldly means, in the
large majority of cases the ordinary jurors will bring in a verdict in
favor of the man of small or moderate means, believing that they are in
duty bound to sympathize with the oppressed. In a case where a clerk or
a woman, for instance, is a party to the suit, it is next to impossible
for a man of means to receive equity at the hands of the great palladium
of our liberty. I am sorry it is so, but I speak feelingly in this
matter, as I have myself been a victim of this unworthy class prejudice,
in a country where all men are theoretically equal.
Counsel usually make a great display over the cases of impecunious
clients, out of all proportion to their magnitude. Mole hills become
ostensibly transformed into mountains in the eye of the highly
imaginative lawyer, who works himself up into such a dramatic pitch of
enthusiasm about the wrongs of his client, that he appears to be in dead
earnest. He infuses the same feeling into the jury, who are beguiled
into solemnity by the force of forensic oratory, and fail to appreciate
the farcical side of the case, but are totally swayed by sentiment and
prejudice, to the utter exclusion of the evidence.
There are many objections, also, to trial or partial trial, by referee,
although it is in many instances an improvement on the jury system. It
is, however, amenable to numerous and flagrant abuses.
As an instance of this, I shall briefly relate a case which some time
ago came within the sphere of my own observation.
A gentleman of my acquaintance had a claim for a very large amount
against a financial man in good circumstances, and it was sent to a
referee, who, after a long, tedious and exhaustive investigation of all
the facts, gave a decision in favor of the plaintiff for several hundred
thousand dollars.
Soon after the decision, the defendant saw the plaintiff, and made him
an offer of thirty thousand dollars to settle the matter, at the same
time stating that if he did not accept the offer, he would either appeal
the case or hunt up fresh evidence for a new trial.
This offer of settlement, which was but a small part of the amount
awarded by the judgment, was naturally declined by the plaintiff, and
application was made to the court under the pretense of newly discovered
evidence, for a new trial, which was granted. Thereupon, after another
tedious trial, the old beaten track having been gone carefully over
again, without omitting any of the aforesaid “whereases, neverthelesses
and notwithstandings,” or any of the monotonous flummery connected
therewith, the case was again sent to the same referee, before whom the
same wearisome inquiry was repeated. This time, however, the referee
relieved the monotony, at the close, by rendering a decision in favor of
the defendant, for a large sum, instead of the plaintiff, as on the
former occasion.
This decision was a genuine surprise to the plaintiff, who then called
upon the defendant and expressed in severe terms his indignation at the
change that had been unwarrantably made in the decision of the referee,
saying he would not submit to it. He was extremely firm in his manner
and said: “I positively assure you that if the judgment is enforced this
town will not be large enough to hold you and myself.”
The successful defendant then said, “What do you want me to do?”
“Well,” replied the plaintiff magnanimously, “I simply desire to be
released of that judgment.”
“Will that satisfy you?” asked the other litigant.
“Yes,” he replied, “under the circumstances. I have had enough of such
law, and want to get rid of it.”
“Well,” said the defendant, “I will do it, and give you a receipt in
full in satisfaction of all claims.”
After this cordial termination of the trouble, the defendant turned to
the plaintiff and said confidentially, “I am sorry you did not take the
thirty thousand dollars which I offered you. I would sooner you had it
than anyone else, as I had to pay it all the same.”
The profound lesson of humility taught in Scripture, that “the first
shall be last and the last first,” was fully verified in this instance.
As litigation is now carried on either before a jury or a referee, it
has a tendency to stir up bad blood, which grows worse as the case
progresses through its various and lengthy stages, leaving relations
more strained and matters for both parties much worse at the end than at
the beginning. As the case drags its slow length along criminations and
recriminations between plaintiff and defendant are constantly elicited,
and family matters that should be regarded as sacred are dragged before
the eyes of the public, subjected to unfriendly criticism, and innocent
parties who have no interest in the case are subject to have their
private affairs made known, to their great mortification, and often to
their great detriment, having a cloud thrown over their reputation long
after the litigants have passed away.
Thus the evils of litigation are far reaching in their consequences, and
frequently exercise a most deleterious influence over the character and
prosperity of those who have nothing to do with the original parties to
the contest, and have no interest in the suit.
The expense is also another important consideration in going to law, and
is only to be measured by the bank balances of the contending parties.
The time lost in the methods of procedure now generally adopted is of
the utmost importance, especially to people the success of whose
business in a large measure may depend on their personal attention
thereto. It is perfectly astounding to reflect on the important portion
of a person’s existence that may be lost in one case, which, from its
inception in the lower court up through the regular gradations of the
Supreme Court and Court of Appeals when a new trial is had, probably
thus going over the entire ground twice, may consume all the way from
five to ten years under the perpetual pressure of mental anxiety and
torture before the end is reached, when at least one, and sometimes both
parties, are financially ruined.
The worry, wear and tear of attending to a lawsuit in the capacity of
either plaintiff or defendant is perfectly incomprehensible to those who
have never passed through the trying ordeal. A person in either
capacity, with his train of witnesses, is obliged to dance attendance on
court every day, no matter how pressing the necessities of his own
business may be. Books must be carried thither, and all his
establishment must be upset for the convenience of the court and to
gratify the whims and caprices of the opposing litigant. The business
places of the two contending parties are entirely disarranged, and the
help thrown into a state of partial disorganization. Each party to the
suit seeks to give the other all the trouble he possibly can, and to
subject him to all the sources of annoyance his imagination can devise.
Such is the spirit imbued by going to law.
A lawyer, therefore, who has about half a dozen moderate cases has thus
his entire time occupied, and while his clients keep out of bankruptcy
his income is as good as the annuity of a life insurance company, and
frequently the security is better.
The effect of the change which I propose, in the majority of cases where
merchants and business men find it necessary now to resort to legal
methods, would perhaps not render the life of the ordinary lawyer so
happy as it is under the present system, but the merchants would gain
ten-fold more than the lawyers would lose, so the effect upon the entire
community would be incalculably beneficial.
The system of arbitration which I contemplate could be extended in every
line of business throughout the entire country, with a Central
Association in New York or any other city that might be agreed upon. In
fact, there might be several business centres, one in each important
city, with its ramifications extending throughout the section in which
its commercial interests more immediately clustered. Branch associations
could be organized in the smaller cities and towns, enjoying all the
facilities of direct communication with the central body, and availing
themselves of all the information and statistics there collected, and
the nature of decisions in special and leading cases of settlement.
Each association in its own city or town should be considered fully
competent to deal with its own affairs, the Central Association being
only consulted as an advisory body. I should recommend also that each
association should have a governing committee, which should constitute
its Court of Appeal, whose decision should be deemed final.
It would hardly be necessary to prescribe penalties for the few isolated
cases that would kick against the arbitration system, and resort to law,
as their legal experience before they got through would be punishment
sufficient without the association taking any further action.
Discipline, however, of a mild character, would have to be enforced in
these and other special cases, for the better efficiency of
organization.
It might be well to have a rule whereby the parties submitting their
cases to arbitration should recognize the necessity, after having the
methods of procedure thoroughly explained to them, of putting themselves
under obligations to abide by the decision.
In carrying out a national idea of this kind of association, business
could be greatly facilitated and much expense saved by the various
committees having due regard to their places of meeting, so as to be as
near as possible to the centre of the greater number of the witnesses in
each particular case.
The courts, which are now greatly overworked, would be immensely
relieved by this system, and they would have more time to sift important
and exceptional cases which, in their nature, could not possibly be made
subjects of arbitration. There are quite enough of such cases to occupy
the time of the various courts.
One of the most vexatious and irritating things connected with court
trials is the constant attendance required, even when no progress is
being made in the case. The expenses, too, are always accumulating.
Though nothing is accomplished the attendance of the lawyers is far from
being a labor of love. Their services must be handsomely rewarded by the
litigants.
Such a process of settlement as I suggest would not, after all, be any
great hardship to the best of the legal fraternity, as there would be
enough work left for them, but it would afford immense relief to the now
overworked judges, while it would facilitate and forward the ends of
justice to an extent that can hardly be imagined by those who have been
always accustomed to the slow and monotonous machinery of the law
courts, and it would help to weed out the large camp following of
pettifoggers, whose occupation would be partially gone.
There is a great deal of time lost in regular court business, causing
much exasperation to the parties to a suit, in settling mere
technicalities and side issues of law, before the real merits of the
case can be reached. Many of these technical delays could be easily
disposed of by business men, on business principles, and by taking a
simple and common-sense view of the matter, by the usual methods pursued
in arbitration.
This new method of settling disputes would do away with the farce of
giving bonds in many cases, which is another great source of annoyance,
and which, after all, only amounts to a mere formality in a large number
of cases, and in many others a very hollow and fraudulent pretense, as
many of the bondsmen are only men of straw, and though technically
qualified, are not in reality responsible for the obligations undertaken
by them.
When good, reliable sureties are offered, in many instances they are put
through an irritating course of examination in relation to their private
affairs, much of which is entirely unnecessary, and only designed to
perplex and annoy them. They are thus obliged to expose matters relating
to their private business, about which the public have no right to know
anything, and they are often examined in such a way, as if they
themselves were on trial, and were attempting criminal concealment of
something that they had a right to disclose. A good deal of this arises
from the impudent, unmannerly style of certain lawyers, who treat a man
as a criminal suspect, when he has no interest in the case whatever, but
has simply come voluntarily forward to assist a friend in trouble.
This is all, however, in the present method of procedure, connected with
the machinery of so-called justice, and this kind of abuse has been
carried to such an extent in some of the instances just referred to,
that very few responsible parties, who know anything about the _modus
operandi_ of qualifying as a surety, are willing to respond to such
calls of friendship. Hence, one of the difficulties in obtaining good
bondsmen, and an additional reason why the professional straw men are so
plentiful.
It probably helps the business of the latter, between whom and the
abusive lawyers there may be an understanding on “boodle” principles.
I shall relate an instance which I consider worthy of permanent record
illustrative of the matters to which I here refer, in which my firm was
victimized.
On the occasion referred to, my firm sued a client for a just debt of
sixteen thousand dollars. The case was sent to a referee, whose
standing, in his particular line, was unquestioned at the time, and very
few men, in his circle, had better family connections. He stood high in
his profession and both sideS were satisfied with the choice. The case
was very long and tedious, having been drawn out to a most provoking
extent by encumbering the record with immense piles of irrelevant
matter. The renewed calls for legal fees on both sides were numerous and
vexatious, yet there was no help but graceful submission to the payment
of this tribute.
After a number of years it was reluctantly conceded by the lawyers that
the evidence was all in on both sides. The litigants breathed heavy and
responsive sighs of relief, each side being confident of victory.
A short time prior to the close of the case, the referee spoke to me,
gratuitously offering his advice to settle the case, as he said he
intended to give a decision adverse to my firm. To this I demurred, and
expressed my determination to fight the case to the bitter end.
The result was, however, that my firm not only did not get a decision in
its favor for the $16,000 to which it was justly entitled, but this
claim was wiped out by this Daniel come to judgment, who gave a decision
in favor of the defendant for $132,000.
I regarded this award as such a terrible outrage upon justice that I
obtained a stay of proceedings, and made an appeal, setting forth
therein the advice given to me by the referee to settle before the case
was closed.
Judge Fancher, who wrote the opinion on behalf of the bench, consigned
that referee to everlasting disgrace, and set aside his opinion. There
the case ended.
Another instance in my experience will illustrate the point which I have
made in regard to the sympathy exhibited by juries with those whom they
regard, rightly or wrongly, as oppressed. At one time I had employed a
clerk at the rate of $2,000 per annum. He was a great disappointment to
me in regard to competency, for the work for which I had engaged him,
and for his entire lack of application to, as well as deficiency in, the
department to which he was assigned. At the end of the first year,
therefore, I gave him notice, in presence of two competent witnesses,
that I should not require him after his year had expired, and advised
him to look out at once for another situation. On the last day of the
year he came to me with tears in his eyes and said that he had been
unable to obtain another place, owing to the bad times prevailing, and
begged me, in the name of his family, who was solely dependent upon him,
to keep him in my services still longer, until he could get another
situation. Purely out of sympathy for his condition, and believing his
story, which was very plausible and pathetic, I told him that he might
remain a short time longer on the same salary, but that I should require
him to use all his exertions to get another place as speedily as
possible.
When he entered on the second term his services were no more use to me
than a fifth wheel is to a coach. After the expiration of a few weeks, I
sent for him and inquired if he had got another situation; I said I had
given him ample time to obtain one, and that I could not consent to keep
him any longer. I therefore requested my cashier to draw a check to his
order for the balance of his wages, up to date, filled in as a part of
the body thereof with the words “payment in full for all claims and
demands.”
Thereupon he left my employment, but called repeatedly at the office
afterward. I assumed that his visits were simply for the purpose of
paying his respects. At the expiration of the second year I received a
notice of suit which he had commenced in Brooklyn for the balance of
salary due him for the year, being at the rate of $2,000 a year for ten
months.
The case came up duly in the Brooklyn court, his only witness being his
father, who had made several calls upon me after the discharge of his
son, on the strength of which he set forth, in his evidence, certain
conferences that should have taken place between him and myself, the
greater part of which were purely fictitious. He was the only witness
called on the side of the plaintiff, while I had five or more witnesses
to substantiate the facts, as I have related them, in relation to the
young man’s discharge, all of them being of most excellent character.
Strange to say, the jury entirely ignored the overwhelming testimony on
my side, and seemed to be altogether influenced by the “spread-eagle”
address of the defendant’s counsel, which I am free to say was both able
and ingenious. He drew a harassing picture of the poverty of the young
man, and presented the imminent destitution of his family in a most
pitiable light, brought about solely by the ruthless treatment of this
hard-hearted millionaire and bloated bondholder. Hence the verdict was
made, through the force of counsel’s oratory, to depend exclusively on
the sympathy of the jury, irrespective of the evidence.
The case occupied several days, with five or six employees from my
office in constant attendance, who were obliged to carry to and from
court, every day, huge books and large quantities of papers, disturbing
the regular business of the office in a very disagreeable manner.
After counsel had gone over the ordinary rigmarole in reviewing the
testimony, the jury went through the formality of retiring, to keep up
appearances, and after a brief interval of absence returned to court
with a verdict for the deeply injured clerk for back pay, together with
interest for the ten months during which he had not rendered me an
hour’s service.
My lawyer was easily able to obtain fresh evidence from other sources,
but he had not considered it necessary to put any more witnesses on the
stand, as he had regarded the testimony already produced more than
ample, so sanguine was he of success, and so fully satisfied of the
plainness of his case, which he considered had only one side, and that
in my favor.
The jury, however, put the boot on the other foot, upset all my
counsel’s calculations and showed him that his law went for nothing
where the famous twelve had the right to judge and legislate at the same
time in accordance with their sympathies and prejudices. Still he went
through the formality of going before the judge with new evidence, and
applied for a new trial, which was ordered on the ground that the
verdict was not in accordance with the weight of evidence.
The new case was called after the customary delays, and the same ground
was duly traversed again, with my additional witnesses, before another
highly intelligent jury, whose prejudices were all on the side of the
greatly injured young man, who sought twelve months’ pay for two months’
useless services. The only witness that appeared again for the defendant
was his faithful and veracious father, whose memory was marvellously
correct in relation to his former statements on the first trial.
There is an old proverb which says that it requires such men to have
good memories. I need not quote it, as almost everyone knows it.
To make a long story short, however, that forensic orator appeared again
for his poverty-stricken client, armed with all the old enthusiasm
exhibited on the former trial. He had not much new matter to present,
but his dramatic attributes, by dint of longer practice, and more
familiarity with his side of the case (it was only necessary for him to
study the one side) had become considerably improved since his former
effort, and it is needless to say that he carried the jury with him.
By that intelligent safeguard of our liberties, the jury, the second
trial was only regarded as an aggravated case of persecution, on my
part, and the verdict was given more cheerfully in favor of the
plaintiff than on the former occasion.
Although it would have been much better for me, from a financial point
of view, to have paid the amount of the exaction, with all the legal and
illegal fees and impositions connected therewith, yet I felt disinclined
to be bamboozled in that way.
When the court was applied to for another new trial, the judge said, “I
have already given you one new trial, taking the responsibility. The
relief you now ask has already been before two juries, and I am not
willing to take upon me any additional responsibility in the matter. You
must therefore look for any further rights or redress to which you may
consider yourself entitled, to the Court of Appeals.”
The case is now, therefore, awaiting the good time and discretion of the
Court of Appeals, where it will, in all probability, be heard and
adjudicated upon sometime within the next ten years. In the meantime the
young man is happy in the reflection that his judgment is a good
investment, drawing six per cent. interest.
There is still another case illustrative of some of the peculiar points
referred to, and showing the truth of the maxim among lawyers that, “You
never know what a jury will do,” in which I had the honor, or the
misfortune to be joined.
A well-known outside broker in Wall Street, who had a large experience
in transacting business for Mr. Sage and other notabilities of the
street, in “puts,” “calls,” and other exterior securities, came to me
one afternoon and asked me if I didn’t want to buy a pair of diamond
earrings.
At that time I had not begun my career as a dealer in diamonds, except
in one solitary instance, and that was when I purchased the wedding
ring, which is one of the requisites in a matrimonial contract for a
long term. I was, therefore, comparatively a tyro in the business, and
the party with whom I was dealing did not fail to take advantage of my
inexperience. I made some inquiry about the diamonds from this broker,
to which I received apparently satisfactory answers, and I concluded
they would suit my wife, and as I had had a good day’s business I made
him an offer of a thousand dollars for the precious ornaments, which he
quickly accepted, and I paid him the money.
In the course of a few weeks after I was waited upon by a diamond dealer
and his lawyer, with neither of whom I had the honor of any previous
acquaintance, and they accordingly introduced each other. The diamond
dealer introduced the lawyer and _vice versa_. I immediately concluded I
was going to get a good stock order from both of them, but I was soon
disappointed as well as surprised to find that these gentlemen had
called on an entirely different kind of business, which was totally
devoid of commissions on any stock transactions.
They said I had a pair of earrings belonging to them, and I declined to
give them up except on return of my thousand dollars.
These two gentlemen bade me good day, and in the course of time I was
served with the usual legal papers in a suit which reached the calendar
after some time. The young man who sold me the diamonds was put on the
stand. He testified that he had received them from a certain diamond
broker, but not the dealer in question, with whom he had had no
connection whatever.
The diamond broker, it appeared, had long been agent for this dealer,
selling diamonds and had, as set forth in the evidence, sold over ten
thousand dollars’ worth in a few years.
During the trial a paper was produced to prove that this broker had
received these diamonds to show them to a customer, and as it turned out
I happened to be the customer. The money which I had paid him for them
he had failed to turn over to his employer, of whom I had no knowledge,
nor had I any chance of knowing him in the transaction.
All the facts were presented, as above related, to the jury, who, after
due deliberation, decided that I must give up the diamonds and suffer to
be cheated out of my thousand dollars.
This case is now on appeal. I have since offered to relinquish the
diamonds and lose my money, rather than suffer the expense and trouble
of continuing the litigation, but plaintiff wants to bleed me further to
the tune of $300 to cover his law expenses. To this illegal tribute I
have not yet submitted, and have resolved to see what virtue there is in
further defense before a higher tribunal.
“Millions of dollars for defence, but not a dollar for tribute,” is a
maxim which it is expensive to follow, but after all, the result of such
a course, if one can afford it, may be morally healthy.
I consider that these cases, in which I acted a rather unenviable part,
are only samples of many which constitute one of the best arguments for
a general system of arbitration, such as I have briefly and imperfectly
outlined.
------------------------------------------------------------------------
CHAPTER LII.
NEW YORK AS A FINANCIAL CENTRE.
ITS PAST, ITS PRESENT, ITS FUTURE.—BANKING DECADENCE.—GROWTH OF INTERIOR
CENTRES.—OBSTRUCTION FROM THE NATIONAL BANK LAWS.—RELIEF
DEMANDED.—REQUIREMENTS OF THE FUTURE.
What New York has been as a centre for the settlement of financial
transactions is a matter of history; what it is destined to be, in that
respect, may not be so entirely certain as some people hastily assume.
There are some facts which seem to suggest the question whether our city
may prove able to retain its past proportion of the vast settlements of
this ever-growing continent; and, although there is nothing to warrant
very positive opinions about the future, it must be conceded as an
unquestionable historic fact that in late years there have been symptoms
of positive decadence in the status of our financial metropolis.
In the past there have been three separate successive sets of conditions
directly affecting the financial standing of New York. First, there was
the period when this city was the distributing point for nearly all the
importations, and for the bulk of our domestic manufactures through all
parts of the country. Equally, New York was the almost sole port of
export for Western products, and although the exports for the cotton
States were made direct from their local ports, yet the financial
transactions connected with those shipments were effected through this
city. Then New York had virtually no competitor as an exchange centre.
Next came a period during which the larger Western cities, especially
Chicago and St. Louis, aspired to become distributors of foreign and
Eastern merchandise; a change very naturally following the rapid growth
of population in the West and Southwest. Thus a vast jobbing trade
became rapidly established at these interior centres, and New York’s
share in the distribution of goods to the retail trade became, in a
large measure, confined to the Middle and nearer Western States, and to
a portion of the South. The jobbers of these new interior centres,
however, had still to get their supplies of merchandise from or through
the Eastern metropolis; so that, whilst we lost much of our jobbing
business, we retained, with some limited exceptions, the importing and
commission branches, together with their ordinary rate of increase.
We are now in the beginning of a third and still more important era,
during which both the importing and commission branches of our trade are
threatened with invasion. The Western jobbing houses have attained a
standing which warrants their importing direct from the countries of
production, instead of through New York. Another Western and
Southwestern consumption has risen to such a magnitude as to encourage
the creation of manufacturing establishments in the vicinity of the
markets. The West is rapidly becoming a competitor in the leading
branches of manufacture with the East, and is evidently destined to
supply itself, at no distant day, with a very large portion of the
domestic merchandise hitherto contributed through New York merchants,
and with the facilities of New York banks. Nor is this all. Chicago and
some other Western cities are throwing off their dependence on New York
intermediaries for the exportation of grain and provisions, selling them
direct to Europe, and shipping the goods on through bills of lading.
These changes are not the result of any mere spirit of blind
recklessness grasping after business. They are the product of actual
natural economies, and appear to be so decidedly in the interest of the
Western merchants that it can hardly be doubted that the new methods
have come “to stay.”
Clearly, then, the natural development of national production of
commerce is to build up independent financial centres at the interior,
the effect of which can only be to check in some measure the growing
ascendancy of New York. Perhaps few among my readers will be prepared
for the following statistical facts bearing on this question; the
conclusions to be drawn from which are not very flattering to the pride
of the “Gothamites.”
The transactions at the New York Clearing House are the surest
indication of the standing and progress of this city as a financial
centre. The records of that institution show that its annual exchanges
rose step by step from 5,750 million dollars in 1854 to 48,566 in 1881,
an increase of 744 per cent. in 27 years, or at the average rate of
1,585 millions per year. From 1881 there has been the following
remarkable rate of decline:
In 1881, the exchanges were 48,566 millions of dollars.
In 1882, the exchanges were 46,553 millions of dollars.
In 1883, the exchanges were 40,293 millions of dollars.
In 1884, the exchanges were 34,092 millions of dollars.
In 1885, the exchanges were 25,251 millions of dollars.
Thus it will be seen that there has been a decline in the transactions
of the Clearing House banks of 23,315 millions, or at the rate of 48.4
per cent., within the last four years. Last year the exchanges fell
below even those of twenty years previous, when the amount was 26,032
millions. Of course, this very remarkable decrease in the volume of
transactions is, in part, attributable to the great falling off in the
amount of speculative transactions in 1885, as compared with 1881. This,
however, can only account to a comparatively small extent for such a
vast change. Something is also to be attributed to the general decline
in the prices of merchandise and investments during the period; but this
explanation is also entirely inadequate, for the average fall in prices
did certainly not exceeded 20 per cent., while the decrease in the
exchanges, as already shown, had been 48.4 per cent. Moreover, on the
other side, some offset against the decline in speculation and in prices
must be allowed on account of an increase of five to six millions in the
population of the country during the interval; which, alone should call
for an increase of 10 per cent. within this period. It is still more
significant that, since the year 1872, the capital of the banks in the
New York Clearing House has been reduced from $84,400,000 to
$58,600,000, a decline of 30 per cent.; which at least implies that
banking has become less profitable than it formerly was, and which could
scarcely have happened if New York had retained its wonted share of the
increase of financial operations arising from the growth of population
and commerce in the nation at large.
Some light may be thrown on these changes by a comparison between the
ratio of progress in the transactions of the Clearing Houses of New York
and Chicago respectively.
In 1866, the first complete year of the Chicago Clearing House, the
clearings amounted to $453,800,000, while in 1885 the figures reached
$2,318,500,000—an increase of 410 per cent. At New York, in 1866, the
clearings were $28,717,000,000, and in 1885 they had fallen to
$25,250,000,000—a decrease of 12½ per cent. within two decades of great
national progress, and while the population tributary to this city had
increased over twenty millions.
In the year 1879—the period of the resumption of specie payments and of
the beginning of a great revival of commerce and of financial
enterprise—the Chicago Clearings were $1,257,700,000, and last year they
were $2,318,500,000, showing an increase of 84.3 per cent. The clearings
at New York, within the same period, show an increase of about ¼ of one
per cent.
It has already been shown that the capital of the banks in the New York
Clearing House (exclusive of surplus) fell 30 per cent. below 1872 and
1886; on the other hand, the capital of the banks in the Chicago
Clearing House rose from $9,845,000 in 1872 to $16,928,000 in the
present year, an increase of 72 per cent.
The foregoing comparisons show that although the clearings at Chicago
are only about one-tenth those of New York, yet the former city is
making very rapid strides, while here we are virtually retrograding, and
confirm the conclusion above expressed, that the importance of New York
as a financial centre is suffering from diversion of settlements and of
banking facilities to the larger cities of the interior, and especially
to Chicago.
So far as this tendency is the result of natural changes in conditions,
it is inevitable and must be permanent, if, indeed, it be not destined
to gain in force and extent. But so far as the change is due to
artificial obstructions to banking operations, it is susceptible of
modification.
And here I may be permitted to venture certain suggestions which may
quite possibly encounter objections from men more than my peers in
banking experience and wisdom. It has long been my conviction that the
banking arrangements existing at New York are far from satisfying the
requirements of a city that not only aspires to be, but also possesses
many adaptations for occupying the position of the great financial
centre, not only for domestic settlements, but also for international
exchanges.
The bulk of our banking transactions are done by banks incorporated
under either national or State laws. Admirably as the national banking
system, taken as a whole, is constructed, yet it includes some important
positive disqualifications for its institutions performing an important
class of operations essential to a great centre of exchanges. It was,
perhaps, not to be expected that a system designed mainly for provincial
cities and for rural populations should adequately provide for these
broader wants. Nor could any uniform and homogeneous system be expected
to be very perfect and satisfy at the same time both classes of
requirements. Interior banks, whose management must be expected to be
more or less lacking in experience and competency, may need to be placed
under legal restraints, which, in the case of a thoroughly conducted
metropolitan bank, would be not only needless, but positively injurious.
Unfortunately, this discrimination has received little recognition in
our national bank legislation; on the contrary, that larger discretion
which should have been conceded to the higher training and more select
ability that administer the metropolitan banks, has been ignored, and
heavier restrictions have been placed upon the New York national banks
than upon those of any other part of the national system.
The “reserve” laws are oppressive to no better purpose than that of
positive injury. All other banks than those of New York are permitted to
count in their reserves any funds resting with their “redemption
agents;” and this item usually constitutes, in the case of banks of the
“other reserve cities,” 41 per cent. of the total reserves held, and in
the case of all other banks about 60 per cent. The New York banks, on
the contrary are compelled to hold their _entire_ reserve (25 per cent.
of their deposits) in the form of lawful money. Nor is this the heaviest
embargo. The reserves are not permitted to be used when the occasion
arises for which a bank reserve is always presumed to be provided. The
moment a bank allows its reserve to fall below the required 25 per cent.
it becomes the duty of the Comptroller of the Currency to close its
doors and put it into liquidation if the deficiency be not immediately
made good. If panic occurs, and depositors want their money, there is
nowhere any power to relax the crushing force of this law, and the banks
are therefore compelled to suspend payment to depositors and in order to
avert general ruin at such times they have to resort to the expedient of
making their cash assets available in common, thereby saving themselves
and their customers outside of and in spite of the destructive tendency
of the law. Of course, the danger of running into such a crisis as this
creates a feverish dread in all times of special stringency in the money
market. All eyes are at such times fixed upon the reserve “dead line;”
and, as that limit is approached, loans are artificially contracted,
depositors draw their money, and the very reserve that should be used
for elasticity and to relieve periods of special tension become the
certain cause of panic and ruin. A banking centre whose banks are
periodically exposed to dangers of this serious character, and where the
law unites with adverse circumstances to foster panics, is hampered with
the worst possible disqualification for performing those higher and
broader functions of banking which demand freedom of discretion and
elasticity of resource.
This evil appears all the greater when it is considered that the amount
required to be set apart as so much idle reserve ordinarily exceeds the
entire capital of the banks. It might be supposed to be serious enough
that such a large proportion of the resources of the bank should be held
perpetually idle and earning no interest; but when this sacrifice of
earning capacity is made for a purpose that brings no advantages, but
rather a very serious danger, the effect can be nothing less than an
unwholesome and very injurious restriction upon banking operations, and
it is not surprising, therefore, that the national banks of New York
city exhibit decadence instead of progress.
What is needed to enable this metropolis to reach the financial status
to which it is entitled is a class of banking institutions possessing
facilities and functions much broader and freer than those conferred by
the national charters. It is out of the question to hope that these
facilities may be provided through modifications of the national bank
system. The banks, and especially those of New York, have to encounter
so much prejudice and ignorant demagogism from Congress, in seeking any
modification of the national system, that they would sooner endure
almost any wrong than demand changes in the law. Their only redress is
in reorganizing under the State laws, which many of them have already
done, whilst new institutions almost uniformly prefer the State system.
To meet the wants here contemplated, it would probably be necessary to
get from the State Legislature special authorization for forms and
functions of banking not now distinctly provided for under either
Federal or State laws.
The special business to be done by such a class of banks scarcely needs
enumeration, much of it being so self-evident. In the present stage of
our national development, it is becoming a grave reflection upon our men
of capital that we should remain almost entirely dependent on foreign
bankers for the facilities for transacting our immense external
commerce. The necessity that formerly existed for this dependence can no
longer be urged as an excuse. All the capital and the banking experience
necessary to found and to administer large credit and exchange
institutions are ready to hand. A business of $1,200,000,000 per annum
connected with our imports and exports would be available for this form
of enterprise. Our export trade is crippled in many branches of business
simply because it is found impossible to get the liberal credits
necessary to facilitate consignments to distant markets. Manchester
defeats us on cotton goods, not so much on the ground of prices or
superiority of fabrics, but because her merchants can get any time or
amount of credit required, whilst we have to market our goods on
restricted credits and through Manchester agents, who at the same time
are selling English products in competition with ours. The English
exporter has the advantage of being able to get his credits from the
bank with which he keeps his account, while the American has to go to a
foreign banker, who has no inducement to consider his convenience or to
moderate his charges. The natural place for an export merchant to keep
his account is with the bank that grants him his credits; and this fact
suggests the facility with which banks of the kind here suggested could
build up a large business.
Every year we find it necessary to largely pledge our cotton crop in
advance to provide the means for gathering and marketing it. Why should
this money have to be drawn from England, especially as the crop is
thereby subjected to the control of the foreign buyers, and we are
unable to protect our own products? These advances afford an
illustration of another class of important operations in which the
existing banks cannot directly participate, but which ought properly to
be undertaken by domestic banks.
With respect to our importations, what sufficient reason can be urged
why the importer should have to get his credit from the agent of a
London banker, instead of receiving it from an American bank through
which he chose to transact his entire business, and which, therefore,
would be the fittest source for procuring his credits? It cannot be to
the advantage of the importer to be exposed to the vicissitudes of the
European money markets, nor can the London banker grant credits to
merchants 3,000 miles distant, whose position he imperfectly knows,
without compensation for the extra risk. The business is, therefore,
done at a disadvantage to both parties. The credit should be issued
directly from the point where the importer does his business; and this
would soon become the fact were banks to be provided possessing special
adaptations for doing such a business.
Other functions proper to institutions of the character here suggested
would be the negotiation of corporate loans, temporary advances to
corporations, the receiving of corporate accounts, and the facilitation
of corporate reconstruction. Banking for the larger corporations
presents many possibilities of advantage to both banks and companies of
which our existing banks cannot, as at present restricted, avail
themselves.
It is needless to say that these suggested institutions, whilst
undertaking operations of the special character above indicated, should
also aim to secure the best class of deposits and to discount the higher
class of paper. As the national bank laws would prohibit to them the
profits of circulation, it might well merit consideration whether they
should not issue to customers of high standing their own acceptances,
within certain safe limits. These credits, yielding the current rate of
interest, would be a highly profitable, as well as an entirely
legitimate branch of business; and they have the sanction of successful
usage among the best banks of London. I am unable to see what objection
there should be to further following London precedent by allowing on
deposits a rate of interest below that current in the market for the
time being. Such a course would attract accounts and would immensely
increase the power and the earning resources of the banks. Moreover, as
such institutions, being exempt from embarrassing reserve restrictions
and other needless limitations, would be less subject to the
oscillations of the money markets than are the present banks, they would
afford better advantages to members of the Stock Exchange in the form of
loans upon securities than they now are able to get. The importance of
this business may be inferred from the fact that the yearly transactions
in stocks at the Exchange have averaged, for the last six years,
102,000,000 shares, which, at an estimated average of $60 per share,
represents an annual business of $6,120,000,000, to say nothing of the
business in bonds, which also is very large.
Banks of this character would naturally attract a large portion of the
Stock Exchange houses, which experience has shown to be exceptionally
safe and profitable. The single fact that these banks would not be
obligated to conform their loans to arbitrary 25 per cent. reserve would
be a decisive reason for Wall Street firms doing their business with
such institutions.
To some extent the wants here alluded to have been met by our loan and
trust companies. As institutions of loan and deposit these institutions
are doing important public service, and the deficiencies in the
functions allowed to the national banks are diverting to them a large
and valuable business. The companies of this character in New York and
Brooklyn have nearly $14,000,000 of capital and $15,000,000 of surplus
and profits. Their resources aggregate $175,000,000, and their deposits
$137,000,000. Their rapid progress is indicated by the fact that, since
1883, their resources have increased $32,000,000, or at the rate of 27
per cent. during three years of depression in business. But while this
success demonstrates the great necessity for enlarged local banking
facilities, the facilities afforded by the trust companies are entirely
too limited to satisfy the large special requirements of a great
financial centre above referred to, and only add to the necessity for a
class of banks which shall do for New York what the great joint stock
banks and the mammoth private discount houses of London are doing for
the business of that cosmopolitan centre.
These suggestions are offered for what the men of Wall Street may deem
them worth. They demonstrate that there is ample scope and urgent need
for a new element in our banking arrangements to accommodate the larger
operations of finance and commerce; and it would not be difficult to
prove that the country is suffering seriously from lack of such
facilities. It will not be pretended that there is any lack of either
the capital or the managerial talent requisite for such enterprise. Nor,
since the rate of interest has come to rule as low in this country as it
is in Europe, have we any longer anything to fear on that ground from
the competition of foreign bankers. At any rate, if New York aspires to
a position of financial independence and to become, in the broadest
possible sense, the financial centre of the vast and growing exchanges
of this continent and of its transactions with other nations, there
should be no delay in giving this greater breadth and scope to its
banking institutions. Our merchants, I am satisfied, are ready to
respond to a movement of this character; are the bankers and the
capitalists equally prepared to provide the facilities?
------------------------------------------------------------------------
CHAPTER LIII.
EARTHQUAKE THEORIES AND WALL STREET AFFAIRS.
THE SHOCK OF EVERY CALAMITY FELT IN WALL STREET.—EARTHQUAKES THE ONLY
DISASTERS WHICH SEEM TO DEFY THE POWER OF PRECAUTION.—BECOMING A
SUBJECT OF SERIOUS THOUGHT FOR WALL STREET MEN AND BUSINESS MEN.—THE
VOLCANO THEORY OF EARTHQUAKES.—OTHER CAUSES AT WORK PRODUCING THESE
TERRIFIC UPHEAVALS.—WHY CHARLESTON WAS MORE SEVERELY SHAKEN UP THAN
NEW YORK.—WHY THE SOUTHERN EARTHQUAKE DID NOT STRIKE WALL STREET
WITH GREAT FORCE.—EARTHQUAKES LIKELY TO BECOME THE GREAT DISASTERS
OF THE FUTURE.
Wall Street is the financial centre of this country as much so as London
is recognized to be the financial centre of the world at the present
time. Hence it is really the heart of the nation, through which its
financial blood flows to invigorate and impart new life to every section
of the land. Hence, also, every section and city have an influence on
Wall Street. When the Chicago fire occurred it immediately created a
panic. When a calamity occurs at any part of the country the shock is
first felt in Wall Street. When a large failure happens, such as that of
a bank or important railway, in any other locality, the influence is at
once imparted to Wall Street. This is owing to the fact that Wall Street
is the recognized and only market for securities of every description.
All sections are dependent upon it, because it controls the money
market. It is the great connecting link of the financial transactions of
the whole country. A probable disaster through fire, like that which
occurred at Chicago, is now no longer a terror to the Street or to the
country, as was the case for a long time after that terrible calamity,
for the reason that methods have been adopted for the purpose of
restricting the conflagration and confining it within narrow limits.
Fires which occur now are soon extinguished, and it is unlikely that
they can ever play such havoc as they have done in the past. The
possibility, with our enlarged experience, of taking precaution against
those various calamities has robbed fires of most of their former
terrors. Science and machinery have furnished us with the means of
grappling with them.
But the one great, and now very alarming exception, which seems to defy
the power of science and every human precaution, is an earthquake. This
remarkable phenomenon has awakened great interest and inspired terror in
the minds of the people at the present time, because the exhibition of
its destructive powers is fresh in our memories on account of its
terrific visitation at Charleston. Hence, many people are in great fear
that some other section of the country may be stricken at any moment
with a similar overwhelming disaster. It is the insidious and uncertain
nature of the calamity that strikes the mind with awe. There is no
possibility of anticipating it or making the least provision to avoid
its dreadful consequences. The Charleston earthquake wiped out over ten
millions of property. It came, like a thief in the night, and before
morning the greater portion of the city was a mass of ruins. When we
reflect on the extent of the destruction of property, it is marvellous
how few people were killed—only about one hundred, and only two or three
hundred were wounded. One of the greatest wonders why this calamity
should have occurred in Charleston is, that part of the city has stood
for nearly two centuries, and the recent earthquake has been the first
it has experienced. Another curious circumstance is, that the disaster
should have occurred on so large a scale there, as the locality is so
far removed from the region of any volcano.
This clearly demonstrates that the old “volcano” theory of earthquakes
is thoroughly exploded, and we must seek for causes and the explanations
in other quarters. Although Wall Street has not been governed by any
known law of earthquakes, except as regards the fluctuations of the
properties in a bear market dealt in at the Exchange, yet a great number
of Wall Street habitues, as well as other business men, are beginning to
think seriously on the subject of earthquakes, and are attempting to
penetrate their causes. Reflecting upon the upheaval—or rather the
settling down of Charleston—I have come to the conclusion that similar
disasters may be looked for in other localities, hitherto not subject to
them, and considered by scientists absolutely free from these phenomena,
at least on so large a scale. These peculiar disturbances that now make
life so precarious on this planet, I attribute to the innumerable and so
largely increasing excavations going on in various parts of the country,
in the different mining operations, which displace the underpinning of
the surface and cause it to sink beneath the weight which it carries. Of
all the great mining industries which conspire to produce earthquakes, I
think that of oil plays the most important part, and is the most
treacherous in its operations beneath the surface of the earth. The
pumping of oil from the bowels of the earth has been going on for thirty
years in this country in several districts. I believe it is not too
large an estimate to state that in that time an enormous lake of oil has
been removed, that would probably fill the basin of Lake Erie or
Ontario. That fluid made its way, probably, some of it from long
distances in subterraneous rivers before reaching the place where the
nature of the soil permitted it to gush through a shaft to the surface,
as it does in such abundance in the oil regions of Pennsylvania. Some of
those undercurrents may have come from other States, percolating through
and disintegrating the soil in their passage for hundreds of miles,
until they found an outlet, on the principle that all fluids have a
tendency to find their level. There may be a great underground reservoir
of this oil, which has taken many years to penetrate through the earth
owing to the tendency stated, cleaving, in its subterraneous journey,
fissures through ranges of mountains, and thus loosening the earth and
taking away the support from the surface wherever it has penetrated. The
fluid, percolating through various strata of clay and rock, has
displaced these in its course. Owing to this displacement there must, of
necessity, be a settling down of the land in the various regions through
which the oil has passed, which will, of course, differ in degree owing
to the density of the rock or clay. If the earth should be of a pulpy,
soft nature the settling will be greater, and when it happens to be the
foundation of a town or city the catastrophe will also be greater in
inverse proportion to the degree of consistency of the earth. It is
presumable, therefore, that some of the streets beneath the foundation
of Charleston is of this pulpy, yielding character, and hence great was
the fall of that city.
When New York was visited by the earthquake in 1884, and at various
other times, there was only a moderate shaking up, comparatively
speaking. Why? Because its substructure is solid stone to an immense
depth, even lower than the depths of the ocean. Of these subterraneous
rivers of which I have spoken we have many examples besides that of oil,
and also proofs that they traverse great distances, as, for instance, in
the case of the Saratoga Springs. It is clearly demonstrated that in the
case of these and other springs the waters must come from various
sources, and pass through many varieties of minerals before they arrive
at their destination, and thus receive the combination of elements which
impart to them their medicinal qualities. Then there are numerous
instances of this remarkable power of water in the case of these
monstrous land slides in mountainous regions, such as the Alps. In the
act of attempting to find its level, too, water sometimes exerts its
influence, in breaking up rocks, equal in its manifestation to a
powerful explosive. Thus we see the great influences that are at work
everywhere capable of producing earthquakes without the necessity of
resorting to the volcanic theory and without the aid of fire.
In further illustration of this theory of earthquakes, let us suppose
that one of these immense oil lakes which must exist in the bowels of
the earth should be situated beneath a mountain, where it has been
undisturbed for ages, but through some recent disturbing cause—most
likely that of excavating, to which I have referred—it begins to find an
outlet through various fissures. When once started, this great mass of
fluid matter begins to go with a rush, forcing innumerable outlets,
until the internal lake is in a measure exhausted. This creates an
immense vacuum, which deprives the mountain of a large portion of its
support; hence there is a settling down of several inches or several
feet, according to the nature and the solidity of the support. It is
this process of settling down and the struggle of the large masses of
fluid to force their way out, that create the rumbling noise resembling
that of distant thunder, and which also cause the tremulous and
quivering motion felt at the surface of the earth, and still more
distinctly in the houses, and most distinctly of all in the upper
stories thereof. These effects may be produced at a great distance from
the original cause of action, varying, of course, in their intensity
according to that distance. Several of these effects have been
distinctly experienced in Charleston since the first great catastrophe,
but showing that the cause is weaker and further removed from the scene
of the disaster than it was during the first fearful shock.
The Charleston earthquake did not strike Wall Street with very great
force. The very fact of its weak effect upon the great financial centre
of gravity created about as much surprise in the Street as the frightful
shock itself did in a very different and opposite manner upon the people
of Charleston. The reason that the great catastrophe which overwhelmed
Charleston had so little effect on Wall Street was chiefly owing to the
fact that comparatively little loss fell upon the corporations or the
people connected with Wall Street interests. The loss of ten millions
fell mainly upon the people of the doomed city alone. Only a small
portion fell upon people located elsewhere either in the North or the
South. Had such a disaster happened in any of the large cities North,
East or West, owing to their intertwining connections with Wall Street,
a panic would have been the result not unlike the one which followed the
Chicago fire.
Earthquakes are likely to become the great disasters of the future most
to be dreaded. Our population now comprises sixty millions, which, at
the present rate of increase, will soon reach one hundred millions.
Among these is a large proportion of go-ahead, driving men, who are
constantly diving into the bowels of the earth to dig up the vast
treasures which are there concealed. Through this laudable enterprise
the underpinning of the surface of our globe is being constantly
disturbed; and though it is far from a consoling reflection, the time
may come, and may not be far distant, when such calamities as that of
Charleston may be as common as railroad accidents are now.
[Illustration:
_August Belmont_
]
------------------------------------------------------------------------
CHAPTER LIV.
AUGUST BELMONT.
THE AMERICAN REPRESENTATIVE OF THE ROTHSCHILDS.—BEGINS LIFE IN THE
ROTHSCHILDS’ HOUSE IN FRANKFORT.—CONSUL GENERAL TO AUSTRIA AND
MINISTER TO THE HAGUE.—A GREAT FINANCIER AND A CONNOISSEUR IN ART.
August Belmont has achieved the highest credit of any banker in the
United States. His bills are always in demand and command a little more
than those of any one else. He came to New York comparatively poor, but
is now worth millions. As a representative of the Rothschilds in this
country he has for many years held a high position in the financial
world. He has managed the business of that historic house with prudence
and exceptional acuteness and sagacity. Contrast his success in this
country with the experience of Americans abroad. George Peabody, and J.
S. Morgan, the successor of that philanthropist, may seem to be
exceptions to the rule, but they did not win such social and business
success as has been achieved by Mr. Belmont in this country, and the
fact remains that no American could have been so successful abroad as he
has been in the United States. Europe does not afford the opportunities
that so often arise here. This is the country of great and frequent
opportunities; there is a large and inviting field for enterprise and
business skill, although, of course, all cannot win such a position in
the financial world as that occupied by Mr. Belmont, who is reckoned
among the wealthiest as well as the most honored of America’s adopted
citizens.
He was born in the Rhenish Palatinate sixty-eight years ago. His father
was a man in well-to-do circumstances, who sent him, when he was
thirteen years old, to become an apprenticed clerk to the Rothschilds in
their Frankfort house. According to the German custom, he received no
pay; he was compensated by the opportunity of learning the banking
business. He made rapid progress. Before he was twenty-one he was
selected to accompany one of the Rothschilds to Italy and France as his
secretary. In 1837 the famous house, recognizing the promising field in
this country for profitable investments, sent young Belmont to New York
as their agent, a position which he held till 1858, when he became their
American correspondent and general representative, and this responsible
post he has held ever since. In 1844 he was appointed Consul-General for
Austria, and held the position for five years, when he relinquished it
because of his personal friendship for Louis Kossuth and his sympathy
with Hungary in the quarrel with Austria. In 1849 Mr. Belmont married
the niece of Commodore Perry, the hero of Lake Erie, a beautiful and
accomplished lady, who did much to strengthen his social position. In
1853 he was appointed Minister to the Hague by President Pierce, and
served four years. He has always been a staunch Democrat, and was for
several years chairman of the Democratic National Committee. He has
generally refused to accept public office, but his eldest son, Perry,
has served several terms in Congress.
Mr. Belmont is under the medium height, rather stout, with iron-gray
side whiskers, round German features and keen dark eyes, and among the
strong characteristics of the man is his marked chivalric courtesy and
knightly courage. As a financier he has few equals and no superior, and
to his politic and conservative management, as well as his foresight and
intimate knowledge of affairs, is due the American prestige and success
of the Rothschilds. Mr. Belmont’s house on Fifth Avenue, with its
splendid art treasures, is worth a large fortune in itself. He is a
connoisseur in works of art, and has one of the finest private
collections of pictures in the world. For many years he has also had a
princely residence at Newport and a stock farm at Babylon, Long Island.
Though not, strictly speaking, a club man, he was one of the founders of
the Manhattan Club. His successful career is an illustration of the fact
that this country affords a fine opportunity for the intelligence,
thrift and industry not only of native Americans but of the Republic’s
adopted citizens.
------------------------------------------------------------------------
CHAPTER LV.
THE SOCIALIST OBJECTIONS TO THE PRESENT ORDER OF
SOCIETY EXAMINED.
INCREASE OF POPULATION AND THE GROWING PRESSURE UPON THE MEANS OF
SUBSISTENCE.—EDUCATION AND MORAL IMPROVEMENT THE TRUE REMEDY FOR
EXISTING OR THREATENED EVILS.—ERRORS OF COMMUNISM AND SOCIALISM.—HOW
SOCIALISTIC LEADERS AND PHILOSOPHERS RECOGNIZE THE TRUTH.—GROWTH OF
POPULATION DOES NOT MEAN POVERTY.
Mr. Mill says: “It is impossible to deny that the considerations brought
to notice in the preceding chapter make out a frightful case either
against the existing order of society or against the position of man
himself in this world.” How much of the evils should be referred to the
one, and how much to the other, is the principal theoretic question
which has to be resolved. But the strongest case is susceptible of
exaggeration; and it will be evident to many readers, even from the
passages I have quoted, that such exaggeration is not wanting in the
representations of the ablest and most candid Socialists. Though much of
their allegations is unanswerable, not a little is the result of errors
in political economy; by which, let me say once for all, I do not mean
the rejection of any practical rules of policy which have been laid down
by political economists—I mean ignorance of economic facts, and of the
causes by which the economic phenomena of society as it is are actually
determined.
In the first place, it is unhappily true that the wages of ordinary
labor, in all the countries of Europe, are wretchedly insufficient to
supply the physical and moral necessities of the population in any
tolerable measure. But, when it is further alleged that even this
insufficient remuneration has a tendency to diminish; that there is, in
the words of M. Louis Blanc, _une basse continue des salaires_ (a
continual decline of wages); the assertion is in opposition to all
accurate information, and to many notorious facts. It has yet to be
proven that there is any country in the civilized world where the
ordinary wages of labor, estimated either in money or in articles of
consumption, are declining; while in many they are, on the whole, on the
increase—and an increase which is becoming, not slower, but more rapid.
There are, occasionally, branches of industry which are being gradually
superseded by something else, and in those, until production
accommodates itself to demand, wages are depressed; which is an evil,
but a temporary one, and would admit of great alleviation even in the
present system of social economy. A diminution thus produced of the
reward of labor in some particular employment is the effect and the
evidence of increased remuneration, or of a new source of remuneration,
in some other; the total and the average remuneration being
undiminished, or even increased. To make out an appearance of diminution
in the rate of wages in any leading branch of industry, it is always
found necessary to compare some month or year of special and temporary
depression at the present time, with the average rate, or even some
exceptionally high rate, at an earlier time. The vicissitudes are no
doubt a great evil, but they were as frequent and as severe in their
former periods of economical history as now. The greater scale of the
transactions, and the greater number of persons involved in each
fluctuation, may make the change appear greater, but though a large
population affords more sufferers, the evil does not weigh heavier on
each of them individually. There is much evidence of improvement, and
none that is at all trustworthy, of deterioration, in the mode of living
of the laboring population of the countries of Europe. When there is any
appearance to the contrary it is local or partial, and can always be
traced either to the pressure of some temporary calamity, or to some bad
law or unwise act of government which admits of being corrected, while
the permanent causes all operate in the direction of improvement.
M. Louis Blanc, therefore, while showing himself much more enlightened
than the old school of levellers and democrats—inasmuch as he recognizes
the connection between low wages and the over-rapid increase of
population—appears to have fallen into the same error which was at first
committed by Malthus and his followers, that of supposing that because
population has a greater power of increase than subsistence, its
pressure upon subsistence must be always growing more severe. The
difference is that the early Malthusians thought this an irrepressible
tendency, while M. Louis Blanc thinks that it can be repressed, but only
through a system of Communism. It is a great point gained for truth when
it is recognized that the tendency to over-population is a fact which
Communism, as well as the existing order of society, would have to deal
with. And it is encouraging that this necessity is admitted by the more
considerable chiefs of all existing schools of Socialism. Owen and
Fourier, as well as M. Louis Blanc, admitted it, and claimed for their
respective systems a pre-eminent power of dealing with this difficulty.
However this may be, experience shows that in the existing state of
society the pressure of population on subsistence, which is the
principal cause of low wages, though a great is not an increasing evil;
on the contrary, the progress of all that is called civilization has a
tendency to diminish it, partly by the more rapid increase of the means
of employing and maintaining labor, partly by the increased facilities
opened to labor for transporting itself to new countries and unoccupied
fields of employment, and partly by a general improvement in the
intelligence and prudence of the population. This progress, no doubt, is
slow; but it is much that such progress should take place at all, while
we are still only in the first stage of that public movement for the
education of the whole people which, when more advanced, must add
greatly to the force of the two causes of improvement specified above.
It is, of course, open to discussion what form of society has the
greatest power of dealing successfully with the pressure of population
on subsistence, and on this question there is much to be said for
Socialism; what was long thought to be its weakest point will, perhaps,
prove to be one of its strongest. But it has no just claim to be
considered as the sole means of preventing the general and growing
degradation of the mass of mankind through the peculiar tendency of
poverty to produce over-population. Society as at present constituted is
not descending into that abyss, but gradually, though slowly, rising out
of it, and this improvement is likely to be progressive if bad laws do
not interfere with it.
------------------------------------------------------------------------
CHAPTER LVI.
STOCK EXCHANGE CELEBRITIES.
HOW WALL STREET BANKERS’ NERVES ARE TRIED.—FINE HUMOR, JOCULAR
DISPOSITIONS, AND SCHOLARLY TASTE OF OPERATORS.—GEORGE GOULD AS A
FUTURE FINANCIAL POWER.—AMERICAN NOBILITY COMPARED WITH EUROPEAN
ARISTOCRACY.—HOW THE IRISH CAN ASSIST TO PURGE GREAT BRITAIN OF HER
BILIOUS INCUBUS OF NOBILITY.—THE NATURAL NOBILITY OF OUR OWN
COUNTRY, AND THEIR DESTINY.
Among the well-known members of the Stock Exchange not elsewhere
mentioned are James D. Smith, who is now in his second term as
President, and who is also President of the New York and Exchange clubs
and Commodore of the New York Yacht Club, a man of a genial nature and
everyone’s friend; Brayton Ives, twice President of the Stock Exchange,
the colonel of a cavalry regiment under General Sheridan in the civil
war, and later a Brevet-Brigadier General; a graduate of Yale, and a
member of the Union League, Century, Athletic and University clubs;
Charles Johnes, the King of board room traders, once a clerk for Henry
Clews & Co., now worth a million, and a Prince of good fellows, as
bright and quick as he is popular; Louis Bell, a daring and successful
operator, a son of the well-known Isaac Bell, and who was at one time a
clerk with Brown Brothers & Co., the bankers; John Kirkner, another
plucky operator, keen in forecasting the market, and tenacious of his
opinions, whether contrary to generally accepted views or not; Eugene
Bogert, Wm. B. Wadsworth, William Henriques and James Raymond, also
successful traders; John Slayback, Edward Brandon, James Mitchell,
Vice-Chairman Alexander Henriques, ex-President J. Edward Simmons,
Secretary Geo. W. Ely, Donald Mackay, Thomas B. Musgrave, Frank Work,
the Wormsers, R. P. Flower, John T. Lester, Frank Savin, Charles
Schwartz and A. E. Bateman, are all worthy of special notice. Some of
the foregoing have a large following, more particularly the large room
traders, like Messrs. Johnes, Bell, Bogert, Kirkner and Wadsworth. There
are eleven hundred members of the Stock Exchange, and it is seldom that
a black sheep is discovered among them. There are some lambs, perhaps,
who receive a spring and fall shearing, but if they have pluck the wool
comes back again, and they push up the thorny and brambly path to
wealth, leaving, it is true, a little fleece here and there in the
struggle, but generally “getting there,” nevertheless. It is, however, a
mistake to suppose that all the members of the Stock Exchange are
wealthy. They have their ups and downs like everybody else, and some are
in very moderate circumstances.
The strain on a Wall Street broker is so great, the tension of the
nerves, in one of the most trying vocations known in the business world,
is so severe, that joking and in fact boyish pranks constitute a safety
valve for the relief of brains that would otherwise become disordered.
Without the relief of joking and skylarking, Nature’s own remedy for the
burdened mind in such circumstances—many a stock broker would go mad.
“There is nothing so good as a laugh,” says the song, and this expresses
a profounder truth than is generally suspected. Charles Darwin relaxed
the severe mental strain induced by his inquiries into occult questions
of biological science by reading the humorous extravagances of Mark
Twain, and the greatest thinkers, men who are far out on the cold
frontiers of thought, seeking, as intellectual pioneers, the solution of
the fundamental problem of existence, are proverbially jocular in their
hours of relaxation. Nature herself may be said to laugh, and why not
overburdened business men? The pranks at Christmas on the Stock
Exchange, the sound of hand organs in the Board Room, the smashing of
hats, pushing and jostling, the blowing of tin horns, the waltzes and
lanciers, the walking matches, wrestling and sparring—these are only the
natural reaction through the safety valve of humor which tend to relieve
undue tension and keep the spirits clear and fresh. There is more or
less skylarking on all dull days, and the effect is mental invigoration.
It is a mistake to suppose that only the younger men participate in
these amusements. The older members are the most incorrigible. When a
new member, for instance, is receiving his vigorous initiation and being
hustled here and there like a chip in raging waters, his silk hat
skimming along the floor, the foot ball of hundreds of feet, his collar
at right angles with his person and his coat tails flying like a Dutch
lugger under full sail, a group of older members may look on with
apparent disapproval, but the moment the newcomer is driven in their
direction he finds that his last state is worse than the first. The
veterans give him a reception that makes him look wilder and gasp more
than ever, and he is glad to escape from these gray bearded evil-doers.
The horse play is rough but it does no harm, and the new member, after
buying a new hat, is ready to “get square” on the next unfortunate wight
to be initiated.
As to the Stock Exchange as a great financial institution, none stands
higher in the world. Its transactions involve hundreds of millions in a
year, and nowhere is there more regard for strict equity in business.
Its members are as exemplary a class of business men as can be found
anywhere. Its methods are strictly upright, and a black sheep finds no
mercy. Wealth will not necessarily procure a membership in this great
financial emporium. The applicant must be a person of good repute. It
numbers men of great wealth, men of a high order of talent, men of
scholarly tastes, connoisseurs in art, students of science, literature
and philosophy, and men capable of standing at the helm and giving
direction to vast enterprises in the domain of finance and commerce.
There is not a more intelligent body of men in the world. The very
nature of their business compels them to study great public questions,
and many of the members are men of a distinctly statesmanlike caste of
mind, of whom the Stock Exchange may well be proud, while they
themselves derive no small distinction from being identified with so
illustrious and honorable a body.
WASHINGTON E. CONNOR.
Washington E. Connor was born in New York city about 37 years ago. He
first appeared in Wall Street as a clerk for Wm. Belden & Co., a firm in
which the redoubtable Jim Fisk was once a partner. Black Friday of
September, 1869, when a financial hurricane whistled through Wall
Street, brought young Connor to the front, and he has ever since
remained there. He was long the able lieutenant of Mr. Gould in large
speculations. He is a natural leader in speculation—cool, quick and
adroit. From time to time he has been a director in the Western Union,
Union Pacific, Missouri Pacific, Missouri, Kansas & Texas, Kansas
Pacific and Wabash Companies. He was president of the Central
Construction Company, which established the lines of the American Union
Telegraph Company. He was a director in the famous Credit Mobilier
Company, the Texas & Colorado Improvement Company, the Metropolitan and
New York Elevated roads and the New Jersey Southern. He is a member of
the Union League and the Lotus clubs, and especially enjoys the society
of artists, writers and other persons of talent and cultivation. He has
a good library, and is of a somewhat studious turn of mind. As a youth
he studied at the College of the City of New York.
[Illustration:
_George J. Gould_
]
A FUTURE FINANCIAL POWER.
George J. Gould will be one of the few very rich men in this country, as
he will, of course, be his father’s successor. He possesses good
abilities, has an attractive presence, and is modest and retiring in his
manners. He has, thus far, made an excellent record, and the Stock
Exchange was glad to admit him to membership. He is connected with all
of his father’s roads, and is gradually relieving him of much of the
onerous work connected therewith. If anything should happen to Jay
Gould, George Gould would stand in the same financial relation to his
affairs that Wm. H. Vanderbilt sustained to his father, the Commodore,
and, like him, would be found equal to the new honors and
responsibilities devolving upon him. This reasonable expectation should
dispel any apprehension of a financial shock in the event of Jay Gould’s
demise.
George Gould is bright and agreeable, and a good husband. If Jay Gould
has made enemies, that is no reason why his son should not be popular.
It is proverbial that the male descendants of a family are more akin to
the side of the mother than to that of the father, and as Mrs. Jay Gould
has always been recognized as a most exemplary wife and mother, she may
rightfully be regarded as the equal of any woman in New York, and one to
be respected and honored accordingly by those whom we ought to take as
social exemplars. There should be no other standard of social test than
that of merit; not judging individuals by what they were, but by what
they are to-day; not judging by the ridiculous test of ancestry—a
criterion which would upset some of our social demi-gods—but by the real
worth of the living man or woman. Suppose, for instance, the young
Vanderbilts, who rank high in society, and are splendid specimens of
nature’s noblemen, should be measured by the standard of the old
Commodore when he was a boatman on Staten Island. Everybody would
recognize such a test of fitness as to the last degree absurd. In the
United States nature’s nobility is at the front, as against the
parchment nobility of England and the Continent. The _personelle_ of the
English nobility makes a sorry showing beside that of young George
Gould, the young Vanderbilts, and others of our wealthy Americans.
The modern nobility spring from success in business. Peace has its
victories in the formation of character greater than those of war; and
peace and republicanism will develop the future greatness of the human
family, and not pretentious yet effete monarchies, of which mankind is
heartily sick. Many of the so-called noblemen of to-day shine only by a
faint reflected glimmer from the armor of mediæval ancestors; or their
ancestry may be much more recent, and steal slyly off in the gloom of
forgotten crimes to the prison or the gallows; or their patent of
nobility may be a thing of yesterday, a child’s bauble solemnly
displayed by addle-pated dotards, ridiculous even to the unthinking. The
English nobility is coming to the auction block. Not a few in former
times laid their heads there for treason, but now it is articles of more
value, namely, the curious, the antiquities, the bric-a-brac, the works
of art, the rare furniture, which comes to the block, and they are
purchased by the new nobility raised up by success in finance and
commerce. There is very little in Europe which is not obtainable at a
price. Titles in England may yet be sold as they have been in Italy. Who
cares for a title of Italian or French nobility? To this low estate must
English titles come at last. It is marvellous that they have endured so
many centuries after the downfall of the feudal system that originally
gave them birth.
Why is it that Gladstone has always refused a title?
One reason is that at his birth nature gave him a higher title to
nobility than parchment can ever confer.
Another is that he did not care to be ennobled and then wrapped, as a
titled mummy, in the sweet-scented cerements of political death, to be
buried in that Egyptian tomb of political extinction, the House of
Lords. And to-day he is a Colossus among statesmen, whose grand figure
will loom up in history as one of the foremost men of the nineteenth
century, a Titan dwarfing the proudest of a senile nobility. And yet he
is simply a great Commoner.
If the Irish wish to assist nature in purging Great Britain of her
bilious incumbus of nobility, they should recognize the fact that
ridicule is a good medicine. The Irish are proverbially prolific. Let
them make a point of christening the rising generation with titled
names. Then there would be myriads bearing the name of Duke O’Reilly,
Earl McCarty, Marquis O’Brien, Baron Sullivan, Sir Timothy Finnegan,
Lord McSwynny, and so on. The objection to this plan, however, is that
it would brand thousands of innocent and helpless children of worthy
parents with titles which have become contemptible to all right-thinking
persons as the badges of imbecility, mediocrity, or dishonor. This is a
rather lengthy digression after beginning with one of the natural
nobility which we have in this country, namely, the nobility founded
solely on merit, but the case of a young man like George Gould naturally
suggests contrasts. He is destined to take a commanding position in the
world of finance in future years, and it is gratifying to know that he
is a man of high character, excellent capacity, and of great promise.
There is usually a disposition to criticise the sons of very wealthy
men, due to that envy to which poor human nature is so prone, but the
fact in this case is indisputable that young Gould is held in high
esteem wherever he is known. He is a graduate of Harvard and Columbia,
and a member of the Manhattan and other clubs, and he is, in the
business world, where he is most powerful, simply a reserved and quiet
associate, always controlling his lines, but never interfering in a
strident way with those who are working for them.
------------------------------------------------------------------------
CHAPTER LVII.
A LOOK INTO THE FUTURE.
WHAT WE ARE.—WHAT WE ARE PREPARING FOR.—WHAT WE ARE DESTINED TO DO AND
TO BECOME.—WE ARE ENTERING ON AN ERA OF SEEMING IMPOSSIBILITIES.—YET
THE INCONCEIVABLE WILL BE REALIZED.
In reviewing the past, I am struck with the enormous growth of New York
as a city, New York as a State, and the United States as a Nation. The
fact is that we hustle through the business world so fast (and this is
especially applicable to Wall Street), that we do not realize how
rapidly we are going. To any one who is familiar with the appearance of
the down town or business part of the city, as it was twenty years ago,
ten years ago, or even eight years ago, the difference to-day will give
some intimation of the changes which are going on around us, and are
merely features of development. Why, even ten years ago, the old
Equitable Building was a structure to which attention was attracted
because of its greatness and its superiority over any other building in
New York city—its height, its width, its breadth, its depth, its
elevators, its beauty of arrangement inside and its artistic aspect
outside. Millions of dollars have been spent in the past few months in
making this one building about four times as large as the original
structure which brought pride to the hearts of New Yorkers, and
surprised and startled their friends from the country. To-day it is one
of the greatest buildings on the Island, and even rivals the State
Capitol, which is supposed to be the pride of the people of the Empire
State. This is only one instance. All along lower Broadway, the great
business artery of the country, four-story and five-story buildings have
been torn down, and nine-story buildings put up in their place. Four and
five buildings have been dug away and a single structure put up in their
place, and in some of the buildings—indeed in scores of them—within a
few blocks of the Stock Exchange, there are whole communities of people
who are performing life’s work in their own good way, rather than
interfering with their neighbors or themselves, and who know nothing of
what goes on around and about them, and care less. Small armies of
retainers and servants, and the most perfect mechanism, are needed to
enable these communities to carry on their work with dispatch and
convenience. That is to say, where offices are rented in the eighth and
ninth stories of a building, the occupants expect to be shot up to them,
and down from them, with no trouble to themselves, and no weariness of
limbs—and they are. This must be done, too, without loss of time—and it
is. All the attendant arrangements must have the elements of
luxuriousness and comfort—and they do.
This is a small feature of our development, however. So far as the
development of the city is concerned, this appears to be an era of
bridges, and Rapid Transit Elevated roads. So far as the development of
inter-State communication is concerned this is an era of Express Trains,
which, although they have reached a speed of a mile a minute in certain
perfected sections of the roads, do not at all indicate what will come
to pass in the future. Electricity is, of course, the means for
instantaneous communication between separate points known to human
intelligence, practically annihilating time between the New World and
the Old World, and between separated points in either world, or even in
the cities. But electricity does not travel with anything like the speed
of light and air. Now, in some few instances, we have utilized
compressed air as a means of locomotion. Efforts are being made, but are
still in a crude state of development, for the utilization of
electricity as a motive power. Suppose we look one handled years ahead,
and, calculating upon the factors and experiences of the past one
hundred years, imagine what the picture will be of this town as a city,
and this people as a nation. I believe that one hundred years hence the
era of bridges between this city and those which adjoin it across the
rivers, will have passed away, and that instead of one or two or five
bridges across the East River, we will have pneumatic tubes at every
pier, and I believe the same will be true on either side and at the end
of the island. These tubes will spread from New York, as the blood
vessels in the human body spread out and are supplied from the heart;
for New York is not only the business heart of this country, but it is
destined to be, so surely as God permits growth, the business heart of
the world, and the money centre of the world. And the arteries from this
centre will distribute the blood all over, and in all directions.
Through these pneumatic tubes I believe there will be almost
instantaneous communication or transportation of people from one point
to another. Nor will this be confined to New York city alone. In the
near future the Trunk Line Railroad to leading points, such as
Washington, Philadelphia, Boston and Chicago, will probably run trains
at the rate of one hundred miles an hour, and even this will only be a
beginning. To admit of this, steel rails will be required of about
double their present weight, and the wheels must be proportionately
massive and strong. The risk attendant upon such increased speed will be
no greater than the ordinary speed of the present day, say forty miles
an hour. But the time will come, during the next five generations, when
the pneumatic tubes will extend from here to these central points of the
East and the West and the South; and it will be possible for a man to
leave New York at seven o’clock and go to Chicago for breakfast,
transact his business and return to New York for lunch or business
appointment by twelve o’clock noon of the same day. Of course, one of
the problems to be solved in connection with this sort of meteoric speed
will be to supply air for breathing purposes; and the same compressed
air which will shoot the carriage through the tube, will be in some form
utilized for the purpose. This, however, only for a period; for I think
the time must come when electricity will be the one motive power of this
country and of the world, so far as the transportation of people and
property is concerned. Time is money, and the American idea is to save
time. We now waste little enough of it in all conscience. The greatest
business of the world, that of the New York Stock Exchange, is already
compressed into five hours’ time; and yet it is a business in which the
most trivial error or accident because of haste might cause losses of
millions. The obliteration of time is a necessity of American
enterprise. When Electricity is made the general propelling power, it is
likely that a stationary engine will be located at Niagara Falls, and
the force and power of those waters utilized to supply all the needed
propelling power for this State, if not even beyond, to remote and
far-off sections of our country. I heard it once said by an intelligent
authority, that it had been predicted that instead of the coal mines of
this country sending their products hundreds and thousands of miles
away, for transportation-power, at a great expense, that a stationary
engine would be located at the mouth of the mine, and the power derived
from the coal transmitted therefrom over an electric wire. This would,
indeed, be a great transformation, and a great improvement and a great
economy. But a greater change, one quite as likely in the future, and
perhaps possible within the lifetime of some of our children, will be
the abolition of railroads by the pneumatic tube process, and the
transmission of power as I have suggested.
A hundred years hence the people who then occupy our places will look
upon us as primitive and crude, or, in accordance with the Darwinian
theory, as the monkeys from which their perfected race has been
developed. In fact, there is a good deal of Darwinism in our
development, in a business sense, if not in a human sense. As the
surroundings grow, so does the intellect of the human race, and there is
no telling what we may do or what we may become—provided we live long
enough. We have plenty of room, plenty of power, plenty of natural
ability, and we make our own opportunities; all we lack in this world is
time and perfect science, and if time is given us we may be able to show
what giants of enterprise a free people may become; that, as the first
choice of God’s creation, we lack nothing.
We are proud now of our Brooklyn Bridge. But when the Bridge was opened,
and the foot passenger rate was made one cent per person, and the car
rates three cents, it was a grave question of consideration for the men
upon whom devolved the responsibility of the conduct of the Bridge,
whether or not the cities would supply passengers enough to make the
Bridge self-supporting. It was not expected that they could or would.
But to-day, the rate for foot passengers is one-fifth of one cent, and
the car passengers are transported for two and one-half cents. The time
is not far distant when these rates will be made much less, if not
abolished entirely. They certainly will be abolished so far as the
promenade is concerned; and, at the rate of one cent per passenger now,
the Bridge would earn dividends for each of the two cities which issued
bonds for its construction; while the taxable value of the property in
both has been so largely enhanced, that the Bridge has paid for itself
already, and, yet it has been open less than five years. More than a
year ago the experience of the Directors was that the facilities of this
Bridge were perfectly inadequate; and, while everything has been done to
increase them and extensions and improvements have been made, the Bridge
is still too slow, and its power facilities too limited for the proper
accommodation of the people who cross it from city to city.
This is only one evidence of the growth of New York; it is merely an
incident. There is another incident, which, in connection with what I
have said about the difference in construction of buildings during the
past few years, I think I will mention right here. The city of New York
donated to the Government the site in the City Hall Park where the New
York post-office now stands. It was the original intention that the
building should be only three stories in height. The capping was already
on, and the roof was in the primitive stages of construction, when,
walking down Broadway one morning, as I passed the structure, the
thought occurred to me that, for a building of its size and heavy
granite exterior, its height was disproportionate, and gave it a dwarfed
appearance, and a lack of symmetry. Besides that, whatever space could
be added to it by the increase in its height, even though the additional
room might be a surplus for the time being, the time would soon come
when even more would be needed. I wrote to Architect Mullet, calling his
attention to these facts, and insisting that, in confining the building
to three stories, he was making a mistake; that it was not in keeping
with the magnificence of the structure; that it should have one or more
additional stories, with a mansard addition besides, and that the
business experience of the past most certainly demonstrated that the
room would soon be needed by the Government for the proper conduct of
its affairs in this the greatest business center of the country. Within
a week Mr. Mullet called to see me, and I convinced him that I was
correct in my criticism and predictions. He said, in reply: “But there
is no appropriation; the money appropriated is exhausted, and the
building cannot be enlarged.” I asked him: “Well, what is necessary to
be done in the matter? Suppose I write to Mr. Boutwell, the Secretary of
the Treasury, about it, and urge that the building be enlarged as I
suggest.” Mr. Mullet approved of the suggestion, and I added: “I will
write to several members of Congress to the same effect.” This I did,
and it was not long afterward that Mr. Mullet informed me that my
efforts in the matter had been successful, and he had received orders to
go ahead and make the building four stories in height, with a mansard
roof story besides. This additional room was not needed at the time, but
it has already become inadequate for the accommodation of the Government
postal employees, and a few others who have been granted quarters there.
And now there is a proposition under consideration for the construction
of an additional Government building in this city which will cover two
blocks of ground or more, and in which may be centered the various
departments of Government, which are now scattered in a half dozen or
more places. Is not this evidence of growth? Is not this evidence of
development which justifies what has been said as to our prospective
growth? Yet this is merely incidental to the strides of progress going
on; and, if we are walking at this pace, will not our children’s
children be racing at the different paces suggested by some of the
predictions I have made?
[Illustration:
_Jay Gould_
]
------------------------------------------------------------------------
CHAPTER LVIII.
JAY GOULD.
HIS BIRTH AND EARLY EDUCATION.—CLERK IN A COUNTRY STORE.—HE INVENTS A
MOUSE TRAP.—BECOMES A CIVIL ENGINEER AND SURVEYS DELAWARE
COUNTY.—WRITES A BOOK AND SELLS IT.—GETS A PARTNERSHIP IN A
PENNSYLVANIA TANNERY AND SOON BUYS HIS PARTNER OUT.—HE COMES TO NEW
YORK TO SELL HIS LEATHER, FALLS IN LOVE WITH A LEATHER MERCHANT’S
DAUGHTER AND MARRIES HER.—SETTLES IN THE METROPOLIS AND BEGINS TO
DEAL IN RAILROADS.—BUYS A BANKRUPT ROAD FROM HIS FATHER-IN-LAW,
REORGANIZES IT AND SELLS IT AT A CONSIDERABLE PROFIT.—HENCEFORTH HE
MAKES HIS MONEY DEALING IN RAILROADS.—HIS METHOD OF BUYING,
REORGANIZING AND SELLING OUT AT A LARGE PROFIT.—HOW HE MANAGED ERIE
IN CONNECTION WITH FISK AND DREW.—HIS OPERATIONS ON BLACK
FRIDAY.—CHECKMATED BY COMMODORE VANDERBILT AND OBLIGED TO SETTLE.—HE
MAKES MILLIONS OUT OF WABASH AND KANSAS & TEXAS.—HIS VENTURE IN
UNION PACIFIC.—HIS CONSTRUCTION COMPANIES.—ORGANIZATION OF AMERICAN
UNION TELEGRAPH, AND HIS METHOD OF ABSORBING AND GETTING CONTROL OF
WESTERN UNION.—THE STRIKE OF THE TELEGRAPHERS AND HIS GREAT
ENCOUNTER WITH THE KNIGHTS OF LABOR AND TRADES UNIONISTS.—GOULD’S
FIRST YACHTING EXPEDITION.—AN EXCEEDINGLY HUMOROUS STORY OF HIS
EARLY EXPERIENCE ON THE WATER.—HIS STATUS AS A FACTOR IN RAILROAD
MANAGEMENT.—HIS ACQUISITION OF BALTIMORE & OHIO TELEGRAPH, &C.
If Fenimore Cooper, Sir Walter Scott, Charles Dickens or Dumas, in the
height of the popularity of any of these great writers of fiction, had
evolved from his inner consciousness a Jay Gould as the hero of a novel,
its readers would have found serious fault with the author for
attempting to transcend the rational probability allowed to the latitude
of fiction. Few novel readers, in fact, would have patiently submitted
to such a strain on their credulity prior to the era in the financial
development of this country which produced some of the leading
characters which Wall Street has brought to the front, as stern
realities of every day life, since my advent in the great arena of
speculation.
Among these Jay Gould is conspicuous, and of all the self-made men of
Wall Street he had probably the most difficulty in making the first
thousand dollars of the amazing pile which he now controls.
Jay Gould was born at Stratton Falls, Delaware county, New York, about
the year 1836. He was the son of John B. Gould, a farmer, who kept a
grocery store. At the age of sixteen young Gould became a clerk in a
variety store belonging to Squire Burnham, about two miles from the
Falls. Here, in his leisure hours, he assiduously improved the little
learning he had received at the village school, by applying himself to
the study of book-keeping in the evenings.
It was when he was at this store, according to the most reliable
accounts, that he manifested his natural aptitude for making sharp and
profitable bargains. His employer, the Squire, had his eye on a piece of
land in Albany, which he expected to obtain cheap and so make a profit.
He whispered his intention to some friend in the store and his young
assistant overheard him. When he went to put his design of purchasing
the land in execution he found that young Mr. Gould had been there
before him, and had secured the title.
About this time there was a firm which had undertaken to survey the
county and make office maps of it, and young Gould was employed to
assist them. Having mastered the elementary principles of geometry, and
being naturally quick and correct at figures, he soon became a fair
expert in common land surveying, and made himself exceedingly useful to
his employers. But the idea of not only being his own boss but an
employer of other people’s brains and muscles was one of his ruling
propensities, and he used every effort to attain this object. In a short
time he bought out the firm, wrote a history of the county to accompany
the maps and peddled his book among the residents.
This natural inclination to buy out every concern with which he has been
connected has been the ruling passion of his life, and still tenaciously
adheres to him. Prior to his negotiations with the firm of surveyors, he
had invented a mouse trap in his intervals of leisure in the store, and
with the proceeds of this and the bargain in the land, out of which he
had outwitted his employer, he was enabled to make himself master of the
situation with the surveyors. Shortly after this Gould became interested
in a Pennsylvania tannery with Zadoc Pratt, who was the capitalist.
Through the advice of Israel Corse, the Commission Merchant of the firm,
Col. Pratt proposed to dissolve the partnership. Gould induced Charles
M. Leupp & Co. to purchase Pratt’s interest for $150,000. The business
did not meet the expectations of Leupp, who in a fit of despondency
committed suicide. After his death Gould failed to retain possession of
the property, which was sold to H. D. H. Snyder, thus terminating Mr.
Gould’s career as a Pennsylvania tanner.
On his visits to New York Mr. Gould was attracted by the greater
advantages which the Empire City afforded for extending his business,
and came here to reside. He had ingratiated himself in the favorable
esteem of one of the grocery merchants with whom he had done business.
The merchant took him to his house to board and Mr. Gould fell in love
with his handsome daughter. It was a mutual affair of the heart, like
that of his son George and Miss Edith Kingdon, and a speedy marriage was
the result. The results of the happy union seem to have been all that
could be desired, and the domestic felicity of Mr. and Mrs. Gould, so
far as the public have been able to ascertain, has never suffered the
slightest jar or interruption.
The father-in-law owned shares in a railroad which was in a bad
financial condition. He employed his new son-in-law to see what he could
do to extricate him from a position in which he was likely to become
embarrassed, and he wanted to sell his shares. Mr. Gould examined the
road, (with the locality of which he had been well acquainted in his
boyhood,) saw the favorable possibilities of its future, under good
management, and instead of selling his father-in-law’s shares to a
stranger, he took them at their market value himself, purchased more,
finally obtained control of the entire property, and sold it to a rival
company at a large profit.
This, I believe, was Mr. Gould’s first transaction in railroad matters,
and from that day to this his great speculative forte has been buying
and selling railroads. It was in that kind of business, and not in the
stock market, as is popularly supposed, that he made the great bulk of
his enormous fortune.
On his entrance to Wall Street he began business alone. Afterwards he
formed a partnership with Henry N. Smith and — Martin, the firm taking
the name of Smith, Gould & Martin. Martin is now in a lunatic asylum,
and Henry N. Smith, who was the chief cause of the failure of Wm. Heath
& Co. for a million dollars, is now a poor pensioner on the bounty of
his wife. But Mr. Gould still towers aloft, in the full enjoyment and
the continued progress of his speculative prosperity, without being
dismayed by any competitor, however powerful, and overcoming all
obstacles, no matter how gigantic.
As I have noticed pretty fully some of Mr. Gould’s greatest speculative
transactions, mostly behind the scenes in the chapter on Black Friday
and also in the account of the “Commodore’s Corners,” it will be
unnecessary to repeat them here.
There was one clever transaction in the Black Friday affair that should
be put on record to the credit of the able management of that great
deal. One prominent individual connected therewith was personally
responsible for $4,500,000. This was a pretty heavy load at that time
even for him to carry, but it did not weigh very heavily upon him for
any appreciable length of time. He adroitly managed to shift it over on
to the shoulders of that broad-backed, soulless creature called the Erie
Corporation, making it responsible by simply signing himself “T. R.,”
instead of “J.G.,” the large letters representing the ordinary
contraction “Tr.” for Treasurer. By this simple and ingenious device
this shrewd gentleman got rid of the burthensome legacy on the negative
side, bequeathed to him by the “Black Friday corner.”
There is a story told, with several variations, in regard to a
sensational interview between Mr. Gould and Commodore Vanderbilt. The
scene is laid in the parlor of the Commodore’s house. It was about the
time that the latter was making desperate efforts to get a corner in
Erie, and at that particular juncture when, having been defeated in his
purpose by the astute policy of the able triumvirate of Erie—Gould, Fisk
and Drew—he had applied to the courts as a last resort to get even with
them.
They had used the Erie paper mill to the best advantage, in turning out
new securities of Erie to supply the Vanderbilt brokers, who vainly
imagined that they were getting a corner in the inexhaustible stock. Mr.
Vanderbilt was wild when he discovered the ruse and had no remedy but
law against the perpetrators of this costly prank. These adroit
financiers usually placed the law at defiance, or used it to their own
advantage, but this time they were so badly caught in their own net that
they had to fly from the State and take refuge at Taylor’s Hotel in
Jersey City.
It seems that during their temporary exile beyond the State Gould sought
a private interview one night with the Commodore, in the hope of
bringing about conciliatory measures.
The Commodore conversed freely for some time, but in the midst of his
conversation he seemed to be suddenly seized with a fainting spell, and
rolled from his seat unto the carpet, where he lay motionless and
apparently breathless.
Mr. Gould’s first impulse was to go to the door and summon aid, but he
found it locked and no key in it. This increased his alarm and he became
greatly agitated. He shook the prostrate form of the Commodore, but the
latter was limp and motionless. Once there was a heavy sigh and a half
suffocated breathing, as if it were the last act of respiration.
Immediately afterward the Commodore was still and remained in this
condition for nearly half an hour. Doubtless this was one of the most
anxious half hours that ever Mr. Gould has experienced.
If I were permitted to indulge in the latitude of the ordinary story
teller, I might here draw a harassing picture of Mr. Gould’s internal
emotions, gloomy prospects in a criminal court and dark forebodings. His
prolific brain would naturally be racked to find a plausible explanation
in the event of the Commodore’s death, which had occurred while they
were the sole occupants of the room; and at that time, in the eyes of
the public, they were bitter enemies.
I can imagine that, in the height of his anxiety, he would have been
ready to make very easy terms with his great rival, on condition of
being relieved from his perilous position. It would have been a great
opportunity, if such had been possible, for a third party to have come
in as a physician, pronouncing it a case of heart disease. No doubt Mr.
Gould would have been willing to pay an enormous fee to be relieved of
such an oppressive suspicion.
The object of the Commodore’s feint was evidently to try the courage and
soften the heart of Mr. Gould, who never seemed to suspect that it was a
mere hoax. His presence of mind, however, was equal to the occasion, as
he bore the ordeal with fortitude until the practical joker was pleased
to assume his normal condition and usual vivacity. If Mr. Gould had been
a man of common excitability he might have acted very foolishly under
these trying circumstances, and this doubtless would have pleased his
tormentor intensely.
The _modus operandi_ of Mr. Gould, in the purchase and sale of
railroads, has been to buy up two or more bad roads, put them together,
give the united roads a new name, call it a good, prosperous line, with
immense prospects in the immediate future, get a great number of people
to believe all this, then make large issues of bonds and sell them at a
good price, for the purpose of further improving and enhancing the value
of the property. After these preliminaries had been gone through, if
profitable purchasers came along, they could have the road at a price
that would amply compensate Mr. Gould for all his labor and acute
management. If these purchasers should be unable to run the road
profitably and were obliged to go into liquidation after a year or two,
as frequently happens, then Mr. Gould or his agents would very likely be
found on hand at the sale to take back the road at a greatly reduced
price. Mr. Gould would then get a fresh opportunity of showing the
superiority of his management. He would be able to demonstrate that the
road had left his possession in excellent and progressive condition, but
through loose management had been run down. He would then set about the
work of reorganization again and go through the same role substantially,
with slight variations, as before, realizing a handsome profit on each
successive reorganization.
It would take too much time, and swell this volume far beyond the space
which I have laid out for it, to go minutely into the history of all Mr.
Gould’s great enterprises. In fact, it would take a large volume in
itself to do justice to the various schemes which have been put under
way by him directly and indirectly and carried to a successful issue
during his busy life of a quarter of a century in Wall Street. This
seems a long time for a man who is still so young, although he is a
grandfather, and enjoying the use of his mental faculties more
vigorously than ever.
Owing to my own busy life I have only time to sketch the most salient
points of Mr. Gould’s prosperous career. Some future historian of Wall
Street is destined to make a big “spread” upon him, as the newspaper
reporter would say. He will have ample material if he only begins his
work soon; but whoever undertakes the job should not forget the maxim of
that great veteran of literature, old Dr. Samuel Johnson, about material
for biography having a general tendency to become scarce, and, in some
instances, eventually to vanish. While the reliable material for Mr.
Gould’s biography may be subject to the common fate of growing less, as
time advances, there is no danger of utter oblivion in his case. He has
impressed his footprints on the sands of time too firmly for that.
I don’t for a moment mean to insinuate the reason for this, which is
given by Shakespeare as applicable to similar cases, although some
ill-natured and envious people might use the well-known quotation in
this connection:
“The evil that men do lives after them,
The good is often interred with their bones.”
I have no hesitation in saying that Mr. Gould will leave a large amount
of good after him, and, indeed, it seems now as if the Shakespearian
adage was to be reversed in his case. The evil that he may have done is
likely to be forgotten. He bids fair to outlive most of it, if he only
goes on to the end as he has been doing for the past few years. He is
now showing a decided disposition to become more of a builder up than a
wrecker of values.
Through his great executive ability in railroad management and
construction he has been instrumental in making many blades of grass
grow where none had grown before, causing the desert to blossom like the
rose, assisting thousands who had formerly been poor and almost
destitute, pent up either in European hovels or New York tenement
houses, to find happy homes in the West and South. He has been a great
factor in improving the value of the land, and thus, while he was
enriching himself, adding materially to the wealth and prestige of the
nation and thereby elevating it in the appreciation of the world at
large.