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Title: Contemporary American History, 1877-1913


Author: Charles A. Beard



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CONTEMPORARY AMERICAN HISTORY

1877-1913

by

CHARLES A. BEARD

Associate Professor Of Politics in Columbia University







New York
The Macmillan Company
1914
All rights reserved

Copyright, 1914,
By The Macmillan Company.

Set up and electrotyped. Published February, 1914.

Norwood Press
J. S. Cushing Co.--Berwick & Smith Co.
Norwood, Mass., U.S.A.




PREFACE


In teaching American government and politics, I constantly meet large
numbers of students who have no knowledge of the most elementary facts
of American history since the Civil War. When they are taken to task for
their neglect, they reply that there is no textbook dealing with the
period, and that the smaller histories are sadly deficient in their
treatment of our age.

It is to supply the student and general reader with a handy guide to
contemporary history that I have undertaken this volume. I have made no
attempt to present an "artistically balanced" account of the last
thirty-five years, but have sought rather to furnish a background for
the leading issues of current politics and to enlist the interest of the
student in the history of the most wonderful period in American
development. The book is necessarily somewhat "impressionistic" and in
part it is based upon materials which have not been adequately sifted
and evaluated. Nevertheless, I have endeavored to be accurate and fair,
and at the same time to invite on the part of the student some of that
free play of the mind which Matthew Arnold has shown to be so helpful in
literary criticism.

Although the volume has been designed, in a way, as a textbook, I have
thrown aside the methods of the almanac and chronicle, and, at the risk
of displeasing the reader who expects a little about everything
(including the Sioux war and the San Francisco earthquake), I have
omitted with a light heart many of the staples of history in order to
treat more fully the matters which seem important from the modern point
of view. I have also refused to mar the pages with black type, paragraph
numbers, and other "apparatus" which tradition has prescribed for
"manuals." Detailed election statistics and the guide to additional
reading I have placed in an appendix.

In the preparation of the book, I have made extensive use of the volumes
by Professors Dunning, Sparks, Dewey, and Latane, in the American Nation
Series, and I wish to acknowledge once for all my deep debt to them. My
colleague, Mr. B. B. Kendrick, read all of the proofs and saved me from
many an error. Professor R. L. Schuyler gave me the benefit of his
criticisms on part of the proof. To Dr. Louis A. Mayers, of the College
of the City of New York, I am under special obligations for valuable
suggestions as to arrangement and for drafting a large portion of
Chapter III. The shortcomings of the book fall to me, but I shall be
recompensed for my indiscretions, if this volume is speedily followed by
a number of texts, large and small, dealing with American history since
the Civil War. It is showing no disrespect to our ancestors to be as
much interested in our age as they were in theirs; and the doctrine that
we can know more about Andrew Jackson whom we have not seen than about
Theodore Roosevelt whom we have seen is a pernicious psychological
error.

 CHARLES A. BEARD.

 COLUMBIA UNIVERSITY,
 November, 1913.




TABLE OF CONTENTS


 CHAPTER                                            PAGE

    I. THE RESTORATION OF WHITE DOMINION IN THE SOUTH        1

   II. THE ECONOMIC REVOLUTION                              27

  III. THE REVOLUTION IN POLITICS AND LAW                   50

   IV. PARTIES AND PARTY ISSUES, 1877-1896                  90

    V. TWO DECADES OF FEDERAL LEGISLATION, 1877-1896       117

   VI. THE GROWTH OF DISSENT                               143

  VII. THE CAMPAIGN OF 1896                                164

 VIII. IMPERIALISM                                         199

   IX. THE DEVELOPMENT OF CAPITALISM                       229

    X. THE ADMINISTRATIONS OF THEODORE ROOSEVELT           254

   XI. THE REVIVAL OF DISSENT                              283

  XII. MR. TAFT AND REPUBLICAN DISINTEGRATION              317

 XIII. THE CAMPAIGN OF 1912                                344

 APPENDIX                                                  382

 BIBLIOGRAPHY                                              383

 INDEX                                                     391




CONTEMPORARY AMERICAN HISTORY




CHAPTER I

THE RESTORATION OF WHITE DOMINION IN THE SOUTH


When President Hayes was inaugurated on March 4, 1877, the southern
whites had almost shaken off the Republican rule which had been set up
under the protection of Federal soldiers at the close of the Civil War.
In only two states, Louisiana and South Carolina, were Republican
governors nominally in power, and these last "rulers of conquered
provinces" had only a weak grip upon their offices, which they could not
have maintained for a moment without the aid of Union troops stationed
at their capitals. By secret societies, like the Ku Klux Klan, and by
open intimidation, the conservative whites had practically recovered
from the negroes, whom the Republicans had enfranchised, the political
power which had been wrested from the old ruling class at the close of
the War. In this nullification of the Fifteenth Amendment to the Federal
Constitution and other measures designed to secure the suffrage for the
former bondmen, President Grant had acquiesced, and it was openly
rumored that Hayes would put an end to the military regime in Louisiana
and South Carolina, leaving the southern people to fight out their own
battles.

Nevertheless, the Republicans in the North were apparently loath to
accept accomplished facts. In their platform of 1876, upon which Hayes
was elected, they recalled with pride their achievement in saving the
Union and purging the land of slavery; they pledged themselves to pacify
the South and protect the rights of all citizens there; they pronounced
it to be a solemn obligation upon the Federal government to enforce the
Civil War amendments and to secure "to every citizen complete liberty
and exact equality in the exercise of all civil, political, and public
rights." Moreover, they charged the Democratic party with being "the
same in character and spirit as when it sympathized with treason."

But this vehement declaration was only the death cry of the gladiators
of the radical Republican school. Stevens and Sumner, who championed the
claims of the negroes to full civil and political rights, were gone; and
the new leaders, like Conkling and Blaine, although they still waxed
eloquent over the wrongs of the freedmen, were more concerned about the
forward swing of railway and capitalist enterprises in the North and
West than they were about maintaining in the South the rule of a handful
of white Republicans supported by negro voters. Only a few of the
old-school Republicans who firmly believed in the doctrine of the
"natural rights" of the negro, and the officeholders and speculators who
were anxious to exploit the South really in their hearts supported a
continuance of the military rule in "the conquered provinces."

Moreover, there were special circumstances which made it improbable that
President Hayes would permit the further use of troops in Louisiana and
South Carolina. His election had been stoutly disputed and it was only a
stroke of good fortune that permitted his inauguration at all. It was
openly charged that his managers, during the contest over the results of
the election in 1876, had promised the abolition of the military regime
in the South in return for aid on the part of certain Democrats in
securing a settlement of the dispute in his favor. Hayes himself had,
however, maintained consistently that vague attitude so characteristic
of practical politicians. In his speech of acceptance, he promised to
help the southern states to obtain "the blessings of honest and capable
self-government." But he added also that the advancement of the
prosperity of those states could be made most effectually by "a hearty
and generous recognition of the rights of all by all." Moreover, he
approved a statement by one of his supporters to the effect that he
would restore all freemen to their rights as citizens and at the same
time obliterate sectional lines--a promise obviously impossible to
fulfill.

Whether there was any real "bargain" between Hayes and the Democratic
managers matters little, for the policy which he adopted was inevitable,
sooner or later, because there was no active political support even in
the North for a contrary policy. A few weeks after his inauguration
Hayes sent a commission of eminent men to Louisiana to investigate the
claims of the rival governments there--for there were two legislatures
and two governors in that commonwealth contending for power. The
commission found that the Republican administration, headed by Governor
Packard, was little more than a sham, and advised President Hayes of
the fact. Thereupon the President, on April 9, 1877, ordered the
withdrawal of the Federal troops from the public buildings, and
Louisiana began the restoration of her shattered fortunes under the
conservative white leadership. A day later, the President also withdrew
the troops from the capitol at Columbia, South Carolina, and the
Democratic administration under Governor Wade Hampton, a former
Confederate veteran, was duly recognized. Henceforward, the freedmen of
the South were to depend upon the generosity of the whites and upon
their own collective efforts, aided by their sympathizers, for whatever
civil and political rights they were permitted to enjoy.


_The Disfranchisement of the Negro_

Having secured the abolition of direct Federal military interference
with state administrations in the South, the Democrats turned to the
abrogation of the Federal election laws that had been passed in
1870-1871, as a part of the regular reconstruction policy for protecting
the negroes in the exercise of the suffrage. These election laws
prescribed penalties for intimidation at the polls, provided for the
appointment, by Federal circuit courts, of supervisors charged with the
duty of scrutinizing the entire election process, and authorized the
employment of United States marshals, deputies, and soldiers to support
and protect the supervisors in the discharge of their duties and to keep
the peace at the polls.

These laws, the Republican authors urged, were designed to safeguard
the purity of the ballot, not only in the South but also in the North,
and particularly in New York, where it was claimed that fraud was
regularly employed by the Democratic leaders. John Sherman declared that
the Democrats in Congress would be a "pitiful minority, if those elected
by fraud and bloodshed were debarred," adding that, "in the South one
million Republicans are disfranchised." Democrats, on the other hand,
replied that these laws were nothing more than a part of a gigantic
scheme originated by the Republicans to fasten their rule upon the
country forever by systematic interference with elections. Democratic
suspicions were strengthened by reports of many scandals--for instance,
that the supervisors in Louisiana under the Republican regime had
registered "eight thousand more colored voters than there were in the
state when the census was taken four years later." Undoubtedly, there
were plenty of frauds on both sides, and it is an open question whether
Federal interference reduced or increased the amount.

At all events, the Democrats, finding themselves in a majority in the
House of Representatives in 1877, determined to secure the repeal of the
"force laws," and in their desperation they resorted to the practice of
attaching their repeal measures to appropriation bills in the hope of
compelling President Hayes to sign them or tying up the wheels of
government by a stoppage in finances. Hayes was equal to the occasion,
and by a vigorous use of the veto power he defeated the direct assaults
of the Democrats on the election laws. At length, however, in June,
1878, he was compelled to accept a "rider" in the form of a proviso to
the annual appropriation bill for the army making it impossible for
United States marshals to employ federal troops in the execution of the
election laws. While this did not satisfy the Democrats by any means,
because it still left Federal supervision under the marshals, their
deputies and the election supervisors, it took away the main prop of the
Republicans in the South--the use of troops at elections.

The effect of this achievement on the part of the Democrats was apparent
in the succeeding congressional election, for they were able to carry
all of the southern districts except four. This cannot be attributed,
however, entirely to the suppression of the negro vote, for there was a
general landslide in 1878 which gave the Democrats a substantial
majority in both the House and the Senate. Inasmuch as a spirit of
toleration was growing up in Congress, the clause of the Fourteenth
Amendment excluding from Congress certain persons formerly connected
with the Confederacy, was not strictly enforced, and several of the most
prominent and active representatives of the old regime found their way
into both houses. Under their vigorous leadership a two years' political
war was waged between Congress and the President over the repeal of the
force bills, but Hayes won the day, because the Democrats could not
secure the requisite two-thirds vote to carry their measures against the
presidential veto.

However, the Supreme Court had been undermining the "force laws" by
nullifying separate sections, although it upheld the general principle
of the election laws against a contention that elections were wholly
within the control of state authorities. In the case of United States
_v._ Reese, the Court, in 1875, declared void two sections of the law of
1870 "because they did not strictly limit Federal jurisdiction for
protection of the right to vote to cases where the right was denied _by
a state_," but extended it to denials by private parties. In the same
year in the case of United States _v._ Cruikshank the Court gave another
blow to Federal control, in the South. A number of private citizens in
Louisiana had waged war on the blacks at an election riot, and one of
them, Cruikshank, was charged with conspiracy to deprive negroes of
rights which they enjoyed under the protection of the United States. The
Supreme Court, however, held that the Federal government had no
authority to protect the citizens of a state _against one another_, but
that such protection was, as always, a duty of the state itself. Seven
years later the Supreme Court, in the case of United States _v._ Harris,
declared null that part of the enforcement laws which penalized
conspiracies of two or more citizens to deprive another of his rights,
on the same ground as advanced in the Louisiana case.[1]

On the withdrawal of Federal troops and the open abandonment of the
policy of military coercion, the whites, seeing that the Federal courts
were not inclined to interfere, quickly completed the process of
obtaining control over the machinery of state government. That process
had been begun shortly after the War, taking the form of intimidation
at the polls. It was carried forward another step when the "carpet
baggers" and other politicians who had organized and used the negro vote
were deprived of Federal support and driven out. When this active
outside interference in southern politics was cut off, thousands of
negroes stayed away from the polls through sheer indifference, for their
interest in politics had been stimulated by artificial forces--bribery
and absurd promises. Intimidation and indifference worked a widespread
disfranchisement before the close of the seventies.

These early stages in the process of disfranchisement were described by
Senator Tillman in his famous speech of February 26, 1900. "You stood up
there and insisted that we give these people a 'free vote and a fair
count.' They had it for eight years, as long as the bayonets stood
there.... We preferred to have a United States army officer rather than
a government of carpet baggers and thieves and scallywags and scoundrels
who had stolen everything in sight and mortgaged posterity; who had run
their felonious paws into the pockets of posterity by issuing bonds.
When that happened we took the government away. We stuffed the ballot
boxes. We shot them. We are not ashamed of it. With that system--force,
tissue ballots, etc.--we got tired ourselves. So we had a constitutional
convention, and we eliminated, as I said, all of the colored people whom
we could under the Fourteenth and Fifteenth Amendments." The experience
of South Carolina was duplicated in Mississippi. "For a time," said the
Hon. Thomas Spight, of that state, in Congress, in 1904, "we were
compelled to employ methods that were extremely distasteful and very
demoralizing, but now we are accomplishing the same and even better
results by strictly constitutional and legal procedure." It should be
said, however, that in the states where the negro population was
relatively smaller, violence was not necessary to exclude the negroes
from the polls.

A peaceful method of disfranchising negroes and poor whites was the
imposition of a poll tax on voters. Negroes seldom paid their taxes
until the fight over prohibition commenced in the eighties and nineties.
Then the liquor interests began to pay the negroes' poll taxes and by a
generous distribution of their commodities were able to carry the day at
the polls. Thereupon the prohibitionists determined to find some
effective constitutional means of excluding the negroes from voting.

This last stage in the disfranchisement process--the disqualification of
negroes by ingenious constitutional and statutory provisions--was
hastened by the rise during the eighties and nineties of the radical or
Populist party in the South, which evenly balanced the Democratic party
in many places and threatened for a time to disintegrate the older
organization. In this contest between the white factions a small number
of active negroes secured an extraordinary influence in holding the
balance of power; and both white parties sought to secure predominance
by purchasing the venal negro vote which was as large as, or perhaps
larger than, the venal white vote in such northern states as
Connecticut, Rhode Island, or Indiana. The conservative wing of the
white population was happy to take advantage of the prevailing race
prejudice to secure the enactment of legislation disfranchising a
considerable number of the propertyless whites as well as the negroes;
and the radicals grew tired of buying negro voters.

Out of this condition of affairs came a series of constitutional
conventions which devised all sorts of restrictions to exclude the
negroes and large numbers of the "lower classes" from voting altogether,
without directly violating the Fifteenth Amendment to the Federal
Constitution providing against disfranchisement on account of race,
color, or previous condition of servitude.

The series of conventions opened in Mississippi in 1890, where the
Populistic whites were perhaps numerically fewest. At that time
Mississippi was governed under the constitution of 1868, which provided
that no property or educational test should be required of voters, at
least not before 1885, and also stipulated that no amendment should be
made except by legislative proposal ratified by the voters.
Notwithstanding this provision, the legislature in February, 1890,
called a convention to amend the constitution "or enact a new
constitution." This convention proceeded to "ordain and establish" a new
frame of government, without referring it to the voters for
ratification; and the courts of the state set judicial sanction on the
procedure, saying that popular ratification was not necessary. This
constitution provides that every elector shall, in addition to
possessing other qualifications, "be able to read any section of the
constitution of this state; or he shall be able to understand the same
when read to him or to give a reasonable interpretation thereof." Under
such a general provision everything depends upon the attitude of the
election officials toward the applicants for registration, for it is
possible to disfranchise any person, no matter how well educated, by
requiring the "interpretation" of some obscure and technical legal
point.

Five years later South Carolina followed the example of Mississippi, and
by means of a state convention enacted a new constitution disfranchising
negroes; and put it into force without submitting it to popular
ratification.[2] The next year (1896) the legislature of Louisiana
called a convention empowered to frame a new constitution and to put it
into effect without popular approval. This movement was opposed by the
Populists, one of whom declared in the legislature that it was "a step
in the direction of taking the government of this state out of the hands
of the masses and putting it in the hands of the classes." In spite of
the opposition, which was rather formidable, the convention was
assembled, and ordained a new frame of government (1898) disfranchising
negroes and many whites. The Hon. T. J. Symmes, addressing the
convention at the close, frankly stated that their purpose was to
establish the supremacy of the Democratic party as the white man's
party.

Four principal devices are now employed in the several constitutional
provisions disfranchising negroes: (1) a small property qualification,
(2) a prerequisite that the voter must be able to read any section of
the state constitution or explain it, when read, to the satisfaction of
the registering officers, (3) the "grandfather clause," as in Louisiana
where any person, who voted on or before 1867 or the son or grandson of
such person, may vote, even if he does not possess the other
qualifications; and (4) the wide extension of disfranchisement for
crimes by including such offenses as obtaining money under false
pretenses, adultery, wife-beating, petit larceny, fraudulent breach of
trust, among those which work deprivation of the suffrage.

The effect of these limitations on the colored vote has been to reduce
it seriously in the far South. If the negro has the amount of taxable
property required by the constitution, he is caught by the provision
which requires him to explain a section of the state constitution to the
satisfaction of the white registering officers. The meanest white,
however, can usually get through the net with the aid of his
grandfather, or by showing his expertness in constitutional law. Mr. J.
C. Rose has published the election statistics for South Carolina and
Mississippi;[3] it appears that in those states there were, in 1900,
about 350,796 adult male negroes and that the total Republican vote in
both commonwealths in the national election of that year was only 5443.
At a rough guess perhaps 2000 votes of this number were cast by white
men, and the conclusion must be that about ninety-nine out of every
hundred negroes failed to vote for President in those states. It is
fair to state, however, that indifference on the part of the negroes was
to some extent responsible for the small vote.

The legal restrictions completed the work which had been begun by
intimidation. Under the new constitution of 1890 in Mississippi, only
8615 negroes out of 147,000 of a voting age were registered. In four
years, the number registered in Louisiana fell from 127,000 in 1896 to
5300 in 1900. This was the exact result which the advocates of white
supremacy desired to attain, and in this they were warmly supported by
eminent Democrats in the North. "The white man in the South," said Mr.
Bryan in a speech in New York, in 1908, "has disfranchised the negro in
self-protection; and there is not a Republican in the North who would
not have done the same thing under the same circumstances. The white men
of the South are determined that the negro will and shall be
disfranchised everywhere it is necessary to prevent the recurrence of
the horrors of carpet bag rule."

Several attempts have been made to test the constitutionality of these
laws in the Supreme Court of the United States, but that tribunal has
been able to avoid coming to a direct decision on the merits of the
particular measures--and with a convincing display of legal reasoning.
The Constitution of the United States simply states that no citizen
shall be deprived of the right to vote on account of race, color, or
previous condition of servitude, and that the representation of any
state in Congress shall be reduced in the proportion to which it
deprives adult male citizens of the franchise. The ingenious provisions
of the southern constitutions do not deprive the negro of the right to
vote on account of his color, but on account of his grandfather, or his
inability to expound the constitution, or his poverty. In one of the
cases before the Supreme Court, the plaintiff alleged that the Alabama
constitution was in fact designed to deprive the negro of the vote, but
the Court answered that it could not afford the remedy, that it could
not operate the election machinery of the state, and that relief would
have to come from the state itself, or from the legislative and
political departments of the Federal government.[4]


_Social Discrimination against the Negro_

The whites in the South were even less willing to submit to anything
approaching social equality with the negro than they were to accept
political equality. Discriminations against the negro in schools, inns,
theaters, churches, and other public places had been common in the North
both before and after the Civil War, and had received judicial sanction;
and it may well be imagined that the southern masters were in no mood,
after the War, to be put on the same social plane as their former
slaves, and the poor whites were naturally proud of their only
possession--a white skin. Knowing full well that this temper prevailed
in the South the radical Republicans in Congress had pushed through on
March 1, 1875, a second Civil Rights Act designed to establish a certain
social equality, so far as that could be done by law.

The spirit of this act was reflected in the preamble: "Whereas it is
essential to just government, we recognize the equality of all men
before the law, and hold that it is the duty of government in its
dealings with the people to mete out equal and exact justice to all, of
whatever nativity, race, color, or persuasion, religious or political;
and it being the appropriate object of legislation to enact great
fundamental principles into law." After this profession of faith, the
act proceeds to declare that all persons within the jurisdiction of the
United States shall be entitled to the full and equal enjoyment of the
accommodations, advantages, facilities, and privileges of inns, public
conveyances on land or water, theaters and other places of amusement,
subject to limitations applied to all alike, regardless of race or
color. The act further provided that in the selection of jurors no
discrimination should be made on account of race, color, or previous
condition of servitude under a penalty of not more than $5,000.
Jurisdiction over offenses was conferred upon the district and circuit
courts of the United States, and heavy penalties were imposed upon those
who violated the law. This measure was, of course, hotly resisted, and,
in fact, nullified everywhere throughout the Union, north and
south--except in some of the simple rural regions.

The validity of the act came before the Supreme Court for adjudication
in the celebrated Civil Rights Cases in 1883 and a part of the law was
declared unconstitutional in an opinion of the Court rendered by Mr.
Justice Bradley. According to his view, the Fourteenth Amendment did not
authorize Congress to legislate upon subjects which were in the domain
of state legislation--that is to create a code of municipal law for the
regulation of private rights; but it merely authorized Congress to
provide modes of relief against state legislation and the action of
state officers, executive or judicial, which were subversive of the
fundamental rights specified in the amendment. "Until some state law has
been passed," he said, "or some state action through its officers or
agents has been taken, adverse to the rights of citizens sought to be
protected by the Fourteenth Amendment, no legislation of the United
States under said Amendment, nor any proceeding under such legislation
can be called into activity: for the prohibitions of the Amendment are
against state laws and acts done under state authority."

The question as to whether the equal enjoyment of the accommodations in
inns, conveyances, and places of amusement was an essential right of the
citizen which no state could abridge or interfere with, Justice Bradley
declined to examine on the ground that it was not necessary to the
decision of the case. He did, however, inquire into the proposition as
to whether Congress, in enforcing the Thirteenth Amendment abolishing
slavery and involuntary servitude, could secure the social equality
contemplated by the act, under the color of sweeping away all the badges
and incidents of slavery. And on this point he came to the conclusion
that mere discriminations on account of race or color could not be
regarded as badges of slavery. "There were," he added, "thousands of
free colored people in this country before the abolition of slavery,
enjoying all of the essential rights of life, liberty, and property the
same as white citizens; and yet no one at that time thought that it was
any invasion of his personal status as a freeman because he was not
admitted to all of the privileges enjoyed by white citizens, or because
he was subjected to discriminations in the enjoyment of accommodations
in inns, public conveyances, and places of amusement."

Clearly, there was no authority in either the Thirteenth or Fourteenth
Amendment for the section of the Civil Rights Act relative to inns,
conveyances, and places of amusement, at least so far as its operation
in the several states was concerned. If, however, any state should see
fit to make or authorize unlawful discriminations amenable to the
prohibitions of the Fourteenth Amendment, Congress had the power to
afford a remedy or the courts in enforcing the Amendment could give
judicial relief. Thus, while the Justice did not definitely say that the
elements of social equality provided in the Civil Rights Act were not
guaranteed by the Fourteenth Amendment, his line of reasoning and his
language left little doubt as to what was the view of the Court.

Section four of the Civil Rights Act forbidding, under penalty,
discrimination against any person on account of race, color, or previous
condition of servitude in the selection of jurors had been passed upon
by the Supreme Court in the case of _Ex parte_ Virginia, decided in
1879, in which the section was held to be constitutional as providing
not a code of municipal law for the regulation of private rights, but a
mode of redress against the operation of state laws. The ground of
distinction between the two cases is clear. A section forbidding
discrimination in inns and conveyances is in the nature of a code of
private law, but a section forbidding discrimination in the selection of
jurors under penalty simply provides a mode of redress against
violations of the Fourteenth Amendment by state authorities.

Undoubtedly there is an admissible distinction between discrimination
against negroes in the selection of juries and the discrimination
against them in inns and public conveyances, for the former may have
definite connection with the security of those civil rights of person
and property--as distinct from social rights--which the Fourteenth
Amendment was clearly designed to enforce. This was the principle which
was brought out by the Court in the two decisions.[5] But if Justice
Bradley in the Civil Rights cases had frankly made the distinction
between _civil_ and _social_ rights, and declared the act
unconstitutional on the ground that it attempted to secure social rights
which the Fourteenth Amendment was not intended to establish, then the
decisions of the Court would have been far more definite in character.

Even if the Supreme Court had not declared the social equality provision
of the Civil Rights Act unconstitutional, it is questionable whether any
real attempt would have been made to enforce it. As it turned out, the
Court gave judicial sanction to a view undoubtedly entertained by the
major portion of the whites everywhere, and it encouraged the South to
proceed with further discriminatory legislation separating the races in
all public and quasi-public places. Railroads and common carriers were
compelled to provide separate accommodations for whites and blacks, "Jim
Crow Cars," as they are called in popular parlance, and to furnish
special seats in street railway cars. These laws have also been upheld
by the courts; but not without a great strain on their logical
faculties.

Undoubtedly there are mixed motives behind such legislation. It is in
some part a class feeling, for whites are allowed to take their colored
servants in the regular coaches and sleeping cars. Nevertheless, the
race feeling unquestionably predominates. As the author of the Louisiana
"Jim Crow Car" law put it: "It is not only the desire to separate the
whites and blacks on the railroads for the comfort it will provide, but
also for the moral effect. The separation of the races is one of the
benefits, but the demonstration of the superiority of the white man over
the negro is the greater thing. There is nothing that shows it more
conclusively than the compelling of negroes to ride in cars marked for
their especial use."


_The Attitude of the North_

Although all possibility of northern interference with the southern
states in the management of their domestic affairs seemed to have
disappeared by Cleveland's first administration, the negro question was
continuously agitated by Republican politicians, and at times with great
vigor. They were much distressed at losing their Federal patronage
after the election of Cleveland in 1884; and this first Democratic
presidential victory after the War led many of them to believe that they
could recover their lost ground only by securing to the negro the right
to vote. The Republicans were also deeply stirred by the
over-representation of the South in the House of Representatives under
the prevailing system of apportionment. They pointed out that the North
was, in this respect, at even a greater disadvantage than before the
Civil War and emancipation.

Under the original Constitution of the United States, only three fifths
of the slaves were counted in apportioning representatives among the
states; under the Fourteenth Amendment all the negroes were counted,
thus enlarging the representation of the southern states. And yet the
negroes were for practical purposes as disfranchised as they were when
they were in servitude. It was pointed out that "in the election of 1888
the average vote cast for a member of Congress in five southern states
was less than eight thousand; in five northern states, over thirty-six
thousand. Kansas, which cast three times the vote of South Carolina, had
only the same number of congressmen." The discrepancy tended to
increase, if anything. In 1906, a Mississippi district with a population
of 232,174 cast 1540 votes, while a New York district with 215,305 cast
29,119 votes.

The Republicans have several times threatened to alter this anomalous
condition of affairs. In 1890, Mr. Lodge introduced in the House of
Representatives a bill providing for the appointment of federal election
commissioners, on petition of local voters, endowed with powers to
register and count all votes, even in the face of the opposition of
local officers. This measure, which passed the House, was at length
killed in the Senate. In their platform of 1904, the Republicans
declared in favor of restoring the negro to his rights under the
Constitution, and for political purposes the party in the House later
coupled a registration and election law with the measure providing for
publicity of campaign contributions. It was not acted upon in the
Senate. In 1908, the Republicans in their platform declared "once more
and without reservation, for the enforcement in letter and spirit of the
Thirteenth, Fourteenth, and Fifteenth Amendments to the Constitution
which were designed for the protection and advancement of the negro,"
and condemned all devices designed to disfranchise him on grounds of
color alone. Although they have been in possession of all branches of
the Federal government several times, the Republicans have deemed it
inexpedient to carry out their campaign promises.

With the decline in the influence of the Civil War veterans in politics,
the possibility of Federal interference has steadily decreased. The
North had never been abolitionist in temper or political belief, as the
vote of the Free Soil party demonstrates. The Republican party was a
homestead, railway, and protectionist party opposed to slavery in the
territories, and its great leader, Lincoln, had long been on record as
opposed to political and social equality for the negro. Emancipation had
come as a stroke of fortune--not because a majority of the people had
deliberately come to the conclusion that it was a measure of justice. As
in the French Revolution at its height, the extreme radicals forged to
the front for a time, so during the Civil War and its aftermath,
"radical" Republicans held the center of the stage and gave to politics
a flavor of talk about "human rights" which was foreign to practical
statesmen like Clay and Webster. In a little while, practical men came
to the helm once more, and they were primarily interested in economic
matters--railways, finance, tariff, corporations, natural resources, and
western development. The cash nexus with the South was formed once more,
and made far stronger and subtler than in olden days. Agitation of the
negro question became bad form in the North, except for quadrennial
political purposes.


_The Negro Problem_

Thus the negro, suddenly elevated to a great height politically, was
almost as suddenly dropped by his new friends and thrown largely upon
his own ingenuity and resources for further advance. His emancipation
and enfranchisement had come almost without effort on his own part,
without that development of economic interest and of class consciousness
that had marked the rise of other social strata to political power. It
was fortuitous and had no solid foundation. It became evident,
therefore, that any permanent advance of the race must be built on
substantial elements of power in the race itself. The whites might help
with education and industrial training, but the hope of the race lay in
the development of intellectual and economic power on its own account.

In relative numerical strength the negro is not holding his own, because
of the large immigration from Europe. In 1790, the negro population
formed 19.3 per cent of the whole, and since that time it has almost
steadily declined, reaching at the last census 10.7 per cent of the
whole. Even in the southern states where the stream of foreign
immigration is the least, the negro population has fallen from 35.2 per
cent in 1790 to 29.8 per cent in 1910. In education, the negro has
undoubtedly made great progress since the War, but it must be remembered
that he was then at the bottom of the scale. The South, though poor as
compared with the North, has made large expenditures for negro
education, but it is authoritatively reported that "nearly half of the
negro children of school age in the South never get inside of the
schoolhouse."[6] The relative expenditures for the education of white
and colored children there are not ascertainable, but naturally the
balance is heavily in favor of the former. When we recall, however, the
total illiteracy of the race under slavery and then discover that in
1910 there was an average daily attendance of 1,105,629 colored children
in the southern schools, we cannot avoid the conclusion that decided
changes are destined to be made in the intellectual outlook of the race.

Reports also show that negroes are accumulating considerable property
and are becoming in large numbers the holders of small farms.
Nevertheless a very careful scholar, Dr. Walter Willcox, believes that
the figures "seem to show that the negro race at the South, in its
competition with the whites, lost ground between 1890 and 1900 in the
majority of skilled occupations which can be distinguished by the aid of
the census figures." Taking the economic status of the race as a whole,
the same authority adds: "The conclusion to which I am brought is that
relatively to the whites in the South, if not absolutely as measured by
any conceivable standard, the negro as a race is losing ground, is being
confined more and more to the inferior and less remunerative
occupations, and is not sharing proportionately to his numbers in the
prosperity of the country as a whole or of the section in which he
mainly lives."

The conclusions of the statistician are confirmed by the impressions of
such eminent champions of the negro as Dr. W. B. Dubois and Mr. Thomas
Fortune. The former declares that "in well-nigh the whole rural South
the black farmers are peons, bound by law and custom to an economic
slavery, from which the only escape is death or the penitentiary." The
latter holds that the negro has simply passed from chattel to industrial
slavery "with none of the legal and selfish restraints upon the employer
which surrounded and actuated the master." These writers attribute the
slow advance of the race to the bondage of law and prejudice to which it
is subjected in the South, and everywhere in the country, as a matter of
fact. Whatever the cause may be, there seems to be no doubt that the
colored race has not made that substantial economic advance and achieved
that standard of life which its friends hoped would follow from
emancipation. Those writers who emphasize heredity in social evolution
point to this as an evidence of the inherent disabilities of the race;
while those who emphasize environment point out the immense handicap
everywhere imposed on the race by law, custom, and prejudice.

Whatever may be the real truth about the economic status of the race,
and after all it is the relative progress of the mass that determines
the future of the race, there can be no doubt that there is an
increasing "race consciousness" which will have to be reckoned with. The
more conservative school, led by Booker T. Washington, is working to
secure for the negro an industrial training that will give him some kind
of an economic standing in the community, and if this is achieved for
large numbers, a radical change in social and political outlook will
follow, unless all signs of history fail. On the other hand, there is
growing up a radical party, under the inspiration of Dr. W. B. Dubois,
which pleads for unconditional political and social equality as a
measure of immediate justice. Dr. Dubois demands "the raising of the
negro in America to full rights and citizenship. And I mean by this no
halfway measures; I mean full and fair equality. That is, a chance to
work regardless of color, to aspire to position and preferment on the
basis of desert alone, to have the right to use public conveniences, to
enter public places of amusement on the same terms as other people, and
to be received socially by such persons as might wish to receive them."

With both of these influences at work and all the forces of modern life
playing upon the keener section of the colored population, nothing but
congenital disabilities can prevent a movement which ruling persons,
North and South, will have to take into account. How serious this
movement becomes depends, however, upon the innate capacity of colored
masses to throw off the shiftlessness and indifference to high standards
of life that, their best friends admit, stand in the way of their
gaining a substantial economic basis, without which any kind of a solid
political superstructure is impossible. The real negro question now is:
"Can the race demonstrate that capacity for sustained economic activity
and permanent organization which has lifted the white masses from
serfdom?"

FOOTNOTES:

[1] In 1894 the Democrats during Cleveland's administration completed
the demolition of the system by repealing the remaining provisions.

[2] Disfranchising provisions were adopted in other southern states as
follows: North Carolina, in 1900; Alabama and Virginia, in 1901;
Georgia, in 1908. See Lobingier, _The People's Law_, pp. 301 ff.; W. F.
Dodd, _Revision and Amendment of State Constitutions_.

[3] _The Political Science Review_, November, 1906, p. 20.

[4] Giles _v._ Harris, 189 U. S., 474.

[5] See a Massachusetts case decided before the Civil War upholding
similar discriminations against negroes. Thayer, _Cases on
Constitutional Law_, Vol. I, p. 576.

[6] This is partly due to the absence of compulsory attendance laws.




CHAPTER II

THE ECONOMIC REVOLUTION


Long before the Civil War, steam and machinery had begun to invade
American industries and statesmen of the new commercial and industrial
order had appeared in Washington. The census of 1860 reported nearly a
million and a half wage earners in the United States, and more than a
billion dollars invested in manufacturing. By that year over thirty
thousand miles of railway had been constructed, including such important
lines as the New York Central, the Erie, the Baltimore and Ohio, and the
Pennsylvania. Politicians of the type of Stephen A. Douglas, who
discussed slavery in public and devoted their less obvious activities to
securing grants of public lands and mineral resources to railway and
manufacturing corporations, had begun to elbow the more cultivated and
respectable leaders like Calhoun, Webster, and Alexander Stephens, who
belonged to the old order.

But the spectacular conflict over slavery prevented the political
results of the economic transformation from coming to the surface. Those
who had occasion to watch the proceedings of Congress during the two
decades just before the War discovered the manipulations of railway
corporations seeking land grants and privileges from the Federal
Government and the operations of the "protected" interests in behalf of
increased tariffs. Those were also harvest days for corporations and
companies in the state legislatures where special charters and
privileges were being bartered away by the wholesale. There was emerging
in a number of the larger industrial centers a small, though by no means
negligible, labor movement. But the slavery issue overshadowed
everything. The annexation of Texas, slavery in the territories, the
Compromise of 1850, the Nebraska bill, and Bleeding Kansas kept the mind
of the North from the consideration of the more fundamental economic
problems connected with the new order. The politicians, to be sure, did
not live by the slavery agitation alone, but it afforded the leading
topics for public discussion and prevented the critical from inquiring
too narrowly into the real staples of politics.

The Civil War sharply shifted the old scenery of politics. It gave a
tremendous impetus to industry and railway construction. The tariff
measures during the War gave to manufacturers an unwonted protection
against foreign competition; the demand for war supplies, iron, and
steel, railway materials, textiles, and food supplies, quickened every
enterprise in the North; the great fortunes made out of speculations in
finances, contracts for government supplies, and land-grants placed an
enormous capital in private hands to carry forward business after the
War was over.

Within little more than a quarter of a century the advance of industry
and commerce had made the United States of Lincoln's day seem small and
petty. The census of 1905 showed over twelve billion dollars invested in
factories and nearly five and one half million wage earners employed. In
that year, the total value of manufactured products was over fourteen
billion dollars--fifteen times the amount turned out in 1860. As late as
1882 the United States imported several hundred thousand tons of steel
rails annually, but within ten years the import had fallen to 134 tons
and no less than 15,000 tons were exported. At the close of the Civil
War about 3000 tons of Bessemer steel were produced annually, but within
twenty years over two million tons were put out every twelve months.

The building of railways more than kept pace with the growth of the
population and the increase in manufacturing. There were 30,000 miles of
lines in 1860; 52,000 in 1870; 166,000 in 1890; and 242,000 in 1910.
Beginning at first with the construction of lines between strategic
centers like Boston and Albany, and Philadelphia and Reading, the
leaders in this new enterprise grew more bold. They pushed rapidly into
the West where there were no cities of magnitude and no prospect of
developing a profitable business within the immediate future. Capital
flowed into the railways like water; European investors caught the
fever; farmers and merchants along prospective lines bought stocks and
bonds, expecting to reap a harvest from increased land values and
business, only to find their paper valueless on account of preferred
claims for construction; and the whole West was aflame with dreams of a
new Eldorado to be created by transportation systems.

The era of feverish construction was shortly followed by the combination
of lines and the formation of grand trunk railways and particular
"systems." In 1869, Cornelius Vanderbilt united the Hudson River and New
York Central lines, linking the metropolis and Buffalo, and four years
later he opened the way to Chicago by leasing the Lake Shore Michigan
and Southern. About the same time two other eastern companies, the
Pennsylvania and Baltimore and Ohio secured western connections which
let them into Chicago.

It must not be thought that this rapid railway expansion was due solely
to private enterprise, for, as has been the standing custom in American
politics, the cost of doubtful or profitless undertakings was thrown as
far as possible upon the public treasury. Up to 1872, the Federal
Government had granted in aid of railways 155,000,000 acres of land, an
area estimated as "almost equal to the New England states, New York, and
Pennsylvania combined; nineteen different states had voted sums
aggregating two hundred million dollars for the same purpose; and
municipalities and individuals had subscribed several hundred million
dollars to help railway construction." To the Union Pacific concern
alone the Federal Government had granted a free right of way through
public lands, twenty sections of land with each mile of railway, and a
loan up to fifty million dollars secured by a second mortgage on the
company's property. The Northern Pacific obtained lands which a railway
official estimated to be worth enough "to build the entire railroad to
Puget Sound, to fit out a fleet of sailing vessels and steamers for the
China and India trade and leave a surplus that would roll up into the
millions." Cities, townships, counties, and states voted bonds to help
build railways within their limits or granted rights of way and lands,
in addition, with a lavish hand.

The chronicle of all the frauds connected with the manipulation of land
grants to railways and the shameless sale of legal privileges cannot be
written, because in most instances no tangible records have been left.
Perhaps the most notorious of all was the Credit Mobilier scandal
connected with the Union Pacific. The leading stockholders in that
company determined to secure for themselves a large portion of the
profits of construction, which were enormous on account of the prodigal
waste; and they organized a sham concern known as the Credit Mobilier in
which they had full control and to which the construction profits went.
Inasmuch as the Federal Government through its grants and loans was an
interested party that might interfere at any time, the concern, through
its agent in Congress, Oakes Ames, a representative from Massachusetts,
distributed generous blocks of stock to "approachable" Senators and
Representatives. News of the transaction leaked out, and a congressional
investigation in 1872 showed that a number of men of the highest
standing, including Mr. Colfax, the Vice President, were deeply
implicated. Nothing was done, however; the leading conspirator, Ames,
was merely censured by the House, and the booty, for the most part,
remained in the hands of those connected with the scandal. When the
road was complete, "it was saddled with interest payments on $27,000,000
first mortgage bonds, $27,000,000 government bonds, $10,000,000 income
bonds, $10,000,000 land grant bonds, and if anything were left, dividend
payments on $36,000,000 of stock."

       *       *       *       *       *

It would be easy to multiply figures showing astounding gains in
industry, business, foreign trade, and railways; or to multiply stories
of scandalous and unfair practices on the part of financiers, but we are
not primarily concerned here with the technique of inventions or the
history of promotion.[7] The student of social and political evolution
is concerned rather with the effect of such material changes upon the
structure of society, that is, with the rearrangements of classes and
the development of new groups of interests, which are brought about by
altered methods of gaining a livelihood and accumulating fortunes. It is
this social transformation that changes the relation of the individual
to the state and brings new forces to play in the struggle for political
power. The social transformation which followed the Civil War embraced
the following elements.

In the first place, capital, as contrasted with agriculture, increased
enormously in amount and in political influence. Great pecuniary
accumulations were thenceforward made largely in business
enterprise--including the work of the entrepreneur, financier,
speculator, and manipulator under that general term. Inevitably, the
most energetic and the keenest minds were attracted by the dominant mode
of money-making. Agricultural regions were drained of large numbers of
strenuous and efficient men, who would otherwise have been their natural
leaders in politics. To these were added the energetic immigrants from
the Old World. That forceful, pushing, dominating section of society
historically known as the "natural aristocracy" became the agents of
capitalism. The scepter of power now passed definitively from the
masters of slaves to the masters of "free laborers." The literary and
professional dependents of the ruling groups naturally came to the
defense of the new order.[8] The old contest between agrarianism and
capitalism now took on a new vigor.[9]

On the side of the masses involved in the transition this economic
revolution meant an increasing proportion of wage workers as contrasted
with agriculturalists, owning and operating their farms, and with
handicraftsmen. This increase is shown by the following table, giving
the number of wage earners in _manufacturing_ alone:

             POPULATION        WAGE EARNERS

 1850        23,191,876           957,059
 1860        31,443,321         1,311,246
 1870        38,558,371         2,053,996
 1880        50,155,783         2,732,595
 1890        62,947,714         4,251,535
 1900        75,994,575         5,306,143
 1910        91,972,266         6,615,046

In terms of social life, this increase in wage workers meant, in the
first place, a rapid growth of city populations. In 1860, the vast
majority of the people were agriculturists; in 1890, 36.1 per cent of
the population lived in towns of over 2500; in 1900, 40.5 per cent; in
1910, 46.3 per cent. In the forty years between the beginning of the
Civil War and the close of the century, Chicago had grown from 109,260
to 1,698,575; Greater New York from 1,174,779 to 3,437,202; San
Francisco from 56,802 to 342,782.

In the next place, the demand for labor stimulated immigration from
Europe. It is true there was a decline during the Civil War, and the
panic of 1873 checked the tide when it began to flow, but by 1880 it had
nearly touched the half-a-million mark, and by 1883 it reached the
astounding figure of 788,992. Almost all of this immigration was from
Germany, Ireland, Great Britain, and Scandinavian countries, less than
one in twenty of the total number coming from Austria-Hungary, Italy,
and Poland in 1880. On the Pacific coast, railway building and
industrial enterprise, in the great dearth of labor, resorted to the
Orient for large supplies of Chinese coolies.

This industrial development meant the transformation of vast masses of
the people into a proletariat, with all the term implies: an immense
population housed in tenements and rented dwellings, the organization of
the class into trades-unions, labor parties, and other groups; poverty
and degradation on a large scale; strikes, lockouts, and social warfare;
the employment of large numbers of women and children in factories; the
demand for all kinds of legislation mitigating the evils of the
capitalist process; and finally attacks upon the very basis of the
industrial system itself.

This inevitable concomitant of the mechanical revolution, the industrial
proletariat, began to make itself felt as a decided political and
economic factor in the decade that followed the War. Between 1860 and
1870, the railway engineers, firemen, conductors, bricklayers, and cigar
makers had formed unions. In the campaign of 1872 a party of Labor
Reformers appeared; and a few years later the Knights of Labor, a grand
consolidated union of all trades and grades of workers, came into
existence as an active force, conducting an agitation for labor bureaus,
an eight hour day, abolition of contract labor systems, and other
reforms, and at the same time engineering strikes.

In 1877 occurred the first of the great labor struggles in that long
series of campaigns which have marked the relations of capitalists and
workingmen during the past four decades. In that year, trouble began
between the management of the Baltimore and Ohio railway and its
employees over a threatened reduction in wages--the fourth within a
period of seven years. From this starting point the contest spread
throughout the East and Middle West, reaching as far as Texas. Inasmuch
as there was already considerable unemployment, the strikers saw that
only by violence and intimidation could they hope to prevent the
companies from moving their trains. Troops were called out by the
governors of several states and Federal assistance was invoked.
Pittsburgh fell almost completely into the hands of the strikers;
railway buildings were burned and property to the value of more than ten
million dollars destroyed. Everywhere the raw militia of the states was
found to be inefficient for such a serious purpose, and the superior
power of the Federal Government's regular troops was demonstrated. Where
railways were in the hands of receivers, Federal courts intervened by
the use of injunctions and the first blood in the contest between the
judiciary and labor was drawn.

The last, but perhaps most significant, result of the industrial
revolution above described has been the rise of enormous combinations
and corporations in industry as well as in transportation. An increasing
proportion of the business of the country has passed steadily into
corporate, as contrasted with individual, ownership;[10] and this
implies a momentous change in the rights, responsibilities, and economic
theories of the owners of capital. Moreover, it involves the creation of
a new class of men, not entrepreneurs in the old sense, but organizers
of already established concerns into larger units.

The industrial revolution had not advanced very far before an intense
competition began to force business men to combine to protect themselves
against their own weapons. As early as 1879 certain oil interests of
Cleveland, Pittsburgh, Philadelphia, and other centers had begun to
control competition by making agreements through their officers. Three
years later, they devised an excellent scheme for a closer organization
in the formation of a "trust." They placed all their stocks in the hands
of nine trustees, including John D. Rockefeller, who issued in return
certificates representing the proportionate share of each holder in the
concern, and managed the entire business in the interests of the
holders.

The trust proved to be an attractive proposition to large business
concerns. Within five years combinations had been formed in cotton oil,
linseed oil, lead, sugar, whisky, and cordage, and it was not long
before a system of interlocking interests began to consolidate the
control of all staple manufactures in the hands of a few financiers. Six
years after its formation the Standard Oil Company was paying to a small
group of holders about $20,000,000 annually in dividends on a capital of
$90,000,000, and the recipients of these large dividends began to invest
in other concerns. In 1879, one of them, H. M. Flagler, became a
director of the Valley Railroad; in 1882, William Rockefeller appeared
as one of the directors of the Chicago, Milwaukee, and St. Paul; in
1887, John D. Rockefeller was connected with a syndicate which absorbed
the Minnesota Iron Company, and about the same time representatives of
the Oil Trust began to figure in the Northern Pacific, the Missouri,
Kansas, and Texas, and the Ohio River railways. Thus a perfect network
of financial connections throughout the country was built up.

But on the whole the decades following the Civil War were characterized
by economic anarchy, _laissez faire_ with a vengeance. There were
prolonged industrial crises accompanied by widespread unemployment and
misery among the working classes. In the matter of railway management
the chaos was unparalleled.

Shortly after 1870 a period of ruinous competition set in and was
followed by severe financial crises among the railways. Passenger and
freight rate "wars" for the "through" traffic brought many roads to the
verge of bankruptcy, in spite of their valiant efforts to save
themselves by exorbitant charges on subsidiary branches where they had
no competition. Crooked financiering, such as the watering of stocks,
misappropriation of construction funds by directors, and the purchase of
bankrupt lines by directors of larger companies and their resale at
great advances, placed a staggering burden of interest charges against
practically all of the lines. In 1873 nearly half of the mileage in the
country was in the hands of court receivers, and between 1876 and 1879
an average of more than one hundred roads a year were sold under the
foreclosure of mortgages. In all this distress the investors at large
were the losers while the "inside" operators such as Jay Gould,
Cornelius Vanderbilt, and Russell Sage doubled their already
over-topping fortunes.

A very good example of this "new finance" is afforded by the history of
the Erie Railway. In 1868, Vanderbilt determined to secure possession of
this line which ran across New York State in competition with the New
York Central and Hudson River lines. Jay Gould and a group of operators,
who had control of the Erie, proceeded to water the stock and "unload"
upon Vanderbilt, whose agents bought it in the hope of obtaining the
coveted control. After a steeple chase for a while the two promoters
came to terms at the expense of the stockholders and the public. Between
July 1 and October 24, 1868, the stock of the Erie was increased from
$34,000,000 to $57,000,000, and the price went downward like a burnt
rocket. During the short period of Gould's administration of the Erie
"the capital stock of the road had been increased $61,425,700 and the
construction account had risen from $49,247,700 in 1867 to $108,807,687
in 1872. Stock to the amount of $40,700,000 had been marketed by the
firm of Smith, Gould, and Martin, and, incredible as it may seem, its
sale had netted the company only $12,803,059."[11]

The anarchy in railway financing, which characterized the two decades
after the War, was also accompanied by anarchy in management. A Senate
investigating committee in 1885 enumerated the following charges against
the railroads: that local rates were unreasonably high as compared with
through rates; that all rates were based apparently not on cost of
service but "what the traffic would bear"; that discriminations between
individuals for the same services were constant; that "the effect of the
prevailing policy of railroad management is, by an elaborate system of
secret special rates, rebates, drawbacks, and concessions, to foster
monopoly, to enrich favorite shippers, to prevent free competition in
many lines of trade in which the item of transportation is an important
factor;" that secret rate cutting was constantly demoralizing business;
that free passes were so extensively issued as to create a privileged
class, thus increasing the cost to the passenger who paid; that the
capitalization and bonded indebtedness of companies largely exceeded the
actual cost of construction; and that railway corporations were engaged
in other lines of business and discriminating against competitors by
unfair rate manipulations. In a word, the theories about competition
written down in the books on political economy were hopelessly at
variance with the facts of business management; the country was at the
mercy of the sharp practices of transportation promoters.

       *       *       *       *       *

However, emphasis upon this great industrial revolution should not be
allowed to obscure the no less remarkable development in agriculture.
The acreage in improved farm lands rose from 113,032,614 in 1850 to
478,451,750 in 1910. In the same period the number of farms increased
from 1,449,073 to 6,361,502. Notwithstanding the significant fact that
"whereas the total population increased 21 per cent between 1900 and
1910, the urban population increased 34.8 per cent and the rural
population 11.2 per cent," the broad basis of the population during the
half a century here under consideration has remained agricultural, and
in 1913 it was estimated that at the present rate of transformation "it
will take a generation before the relative number of industrial wage
workers will have reached half of all bread winners."


_The Development of the West_

When Hayes was inaugurated, a broad wedge of territory separated the
organized states of the East from their sister commonwealths in the far
West--Oregon, California, and Nevada. Washington, Idaho, Montana,
Wyoming, Utah, Arizona, New Mexico, Dakota, and Indian Territory still
remained territories. Their combined population in 1870 was under half a
million, less than that of the little state of Connecticut. New Mexico
with 91,000 and Utah with 86,000 might, with some show of justification,
have claimed a place among the states because Oregon was inhabited by
only 90,000 people. The commonwealth of Nevada, with 42,000, was an
anomaly; it had been admitted to the Union in 1864 to secure the
ratification of the Thirteenth Amendment abolishing slavery.

This vast and sparsely settled region was then in the second stage of
its economic evolution. The trapper, hunter, and explorer had gathered
most of their harvest, and the ranchmen and cowboys with their herds of
cattle were roaming the great grazing areas, waging war on thieves, land
syndicates, and finally going down to defeat in the contest with the
small farmer who fenced off the fertile fields and planted his homestead
there. So bitter were the contests among the cattle kings, and so
extensive was the lawlessness in these regions during the seventies and
early eighties that Presidents were more than once compelled to warn the
warlike parties and threaten them with the Federal troops.

Of course, the opening of the railways made possible a rapidity in the
settlement of the remaining territories which outrivaled that of the
older regions. The first Pacific railroad had been completed in 1869;
the Southern Pacific connecting New Orleans with the coast was opened in
1881; and two years later the Atchison, Topeka, and Santa Fe was
finished, and the last stroke was put on the Northern Pacific,
connecting Chicago and Portland, Oregon. Thus four lines of
communication were established with the coast, traversing the best
agricultural regions of the territories and opening up the
mineral-bearing regions of the mountains as well. Lawless promoters fell
upon the land and mineral resources with that rapacity which Burke
attributed to Hastings.

       *       *       *       *       *

Utah presented, in the eighties, the elements of an ordered and
well-advanced civilization and could with some show of reason ask for
admission as a state. The territory had been developed by the Mormons
who settled there, after suffering "persecution" for their religious
opinions and their plural marriages, in Illinois and Missouri.
Notwithstanding an act of Congress passed in 1862 prohibiting polygamy,
it continued to flourish. The territorial officers were nearly all
Mormons and the remoteness of the Federal authority prevented an
enforcement of the law. Consequently, it remained a dead letter until
1882, when Congress enacted the Edmunds law prescribing heavy penalties,
including the loss of citizenship, for polygamous practices. Hundreds of
prosecutions and convictions followed, but plural marriages were openly
celebrated in defiance of the law. At length, in 1887, Congress passed
the Edmunds-Tucker act authorizing the Federal Government to seize the
property of the Mormon church.

Meanwhile the gentile population increased in the territory; and at
length the Mormons, seeing that the country was determined to suppress
polygamy and that, while the institution was maintained, statehood could
not be secured, decided upon at least an outward acquiescence in the
law. After much discussion in Congress, and notwithstanding the repeated
contention that the Mormons were not sincere in their promises, Utah was
admitted as a state in 1895 under a constitution which, in accordance
with the provisions of the enabling act of Congress, forbade polygamous
and plural marriages forever. Thus the inhabitants of the new state were
bound by a solemn contract with the Union never to restore the marriage
practices which had caused them so much trouble and "persecution," as
they called it.

       *       *       *       *       *

Although the Mormons were the original pioneers and homestead makers in
that great region, theirs was in fact the last of the middle tier of
territories to receive statehood. They had left the advancing frontier
line far behind. To the northward that advance was checked by the
enormous Sioux reservation in Dakota, but the discovery of gold in the
Black Hills marked the doom of the Indian rights. Miners and
capitalists demanded that the way should be made clear for their
enterprise and the land hungry were clamoring for more farms. Indeed,
before Congress could act, pioneers were swarming over the regions
around the Indian lands. Farmers from the other northern states,
Norwegians, Germans, and Canadians were planting their homesteads amid
the fertile Dakota fields; the population of the territory jumped from
14,181 in 1870 to 135,177 in 1880, and before the close of the next
decade numbered more than half a million. It was evident that the region
was destined to be principally agricultural in character, inhabited by
thrifty farmers like those of Iowa and Nebraska. Pretensions to
statehood therefore rose with the rising tide of population.

Far over on the western coast, the claims of Washington to statehood
were being urged. The population there had increased until it rivaled
Oregon and passed the neighboring commonwealth in 1890. In addition to
rich agricultural areas, it possessed enormous timber resources which
were to afford the chief industry for a long time; and keen-sighted men
foresaw a swift development of seaward trade. Between the Dakotas and
Washington lay the narrow point of Idaho and the mountainous regions of
Montana, now rapidly filling up with miners and capitalists exploiting
the gold, silver, coal, copper, and other mineral resources, and
rivaling the sheep and cattle kings in their contest for economic
supremacy.

After the fashion of enterprising westerners, the citizens of these
territories began to boast early of their "enormous" populations and
their "abounding" wealth, and to clamor for admission as states. Finding
their pleas falling upon unheeding ears, the people of the southern
Dakota took matters into their own hands in 1885, called a convention,
framed a constitution, and failing to secure the quick and favorable
action of Congress threatened to come into the Union unasked. Sober
counsels prevailed, however, and the impatient Dakotans were induced to
wait awhile. Meantime the territory was divided into two parts in 1887,
after a popular vote had been taken on the matter.

As had been the case almost from the beginning of the Republic, the
admission of these new states was a subject of political controversy and
intrigue at the national capital. During Cleveland's first
administration the House was Democratic and the Senate Republican.
Believing that Dakota was firmly Republican, the Senate passed the
measure admitting the southern region in 1886, but the Democratic House
was unable to see eye to eye with the Senate on this matter. In the
elections of 1888, the Republicans carried the House, and it was evident
that the new Congress would take some action with regard to the
clamoring territories. Montana was probably Democratic, and Washington
was uncertain. At all events the Democrats thought it wise to come to
terms, and accordingly on February 22, 1889, the two Dakotas,
Washington, and Montana were admitted simultaneously.

With less claim to statehood than any commonwealths admitted up to that
time, except Nevada, the two territories of Idaho and Wyoming were soon
enabled, by the assistance of the politicians, to secure admission to
the Union. Republican politics and the "silver interests" were
responsible for this step. Although neither territory had over 40,000
inhabitants in 1880, extravagant claims were made by the advocates of
admission--claims speedily belied by the census of 1890, which gave
Idaho 88,000 and Wyoming 62,000. At last in July, 1890, they were
admitted to the Union, and the territorial question was settled for a
time, although Arizona and New Mexico felt that their claims were
unjustly treated. It was not until seventeen years later that another
new state, Oklahoma, modeled out of the old Indian Territory, was added
to the Union. Finally, in 1912, the last of the continental territories,
Arizona and New Mexico, were endowed with statehood.[12]


_The Economic Advance of the South_

Notwithstanding the prominence given to the negro question during and
after Reconstruction, the South had other problems no less grave in
character to meet. Industry and agriculture were paralyzed by the
devastations of the War. A vast amount of material capital--railways,
wharves, bridges, and factories--had been destroyed during the conflict;
and fluid capital seeking investment had been almost destroyed as well.
The rich with ready money at their command had risked nearly all their
store in confederate securities or had lost their money loaned in other
ways through the wreck of the currency. Plantations had depreciated in
value, partly because of the destruction of equipment, but especially on
account of the difficulties of working the system without slave labor.
The South had, therefore, to rehabilitate the material equipment of
industry and transportation and to put agriculture on another basis than
that of slave labor. Surely this was a gigantic task.

The difficulties of carrying forward the plantation system with free
negro labor compelled the holders of large estates (many of which were
heavily mortgaged) to adopt one of two systems: the leasing or renting
of small plots to negroes or poor whites, or the outright sale in small
quantities which could be worked by one or two hands. This
disintegration of estates went forward with great rapidity. In 1860 the
average holding of land in the southern states was 335.4 acres; in 1880
it had fallen to 153.4; and in 1900 it had reached 138.2. The great
handicap was the difficulty of securing the capital to develop the small
farm, and no satisfactory system for dealing with this problem has yet
been adopted.

The very necessities of the South served to bind that section to the
North in a new fashion. Fluid capital had to be secured, in part at
least, from the North, and northern enterprise found a new outlet in the
reconstruction of the old, and the development of the new, industries in
the region of the former confederacy. The number of cotton spindles in
the South increased from about 300,000 in 1860 to more than 4,000,000 at
the close of the century; the number of employees rose from 10,000 to
nearly 100,000; and the value of the output leaped from $8,460,337
annually to $95,002,059. This rapid growth was, in part, due to the
abundance of water power in the hill regions, the cheap labor of women
and children, the low cost of living, and the absence of labor laws
interfering with the hours and conditions of work in the factories.

Even in the iron and steel industry, West Virginia and Alabama began to
press upon the markets of the North within less than twenty years after
the close of the War. In 1880, the latter state stood tenth among the
pig-iron producing states; in 1890 it stood third. The southern states
alone now produce more coal, iron ore, and pig iron than all of the
states combined did in 1870. The census of 1909 reports 5685
manufacturing establishments in Virginia, 4931 in North Carolina, 4792
in Georgia, and 3398 in Alabama.

The social effects which accompany capitalist development inevitably
began to appear in the South. The industrial magnate began to contest
with the old aristocracy of the soil for supremacy; many former slave
owners and their descendants drifted into manufacturing and many poor
whites made their way upward into wealth and influence. The census of
1909 reports more than thirty thousand proprietors and firm members in
the South Atlantic states, an increase over the preceding report almost
equal to that in the New England states. The same census reports in the
southern states more than a million wage earners--equal to almost two
thirds the entire number in the whole country at the opening of the
Civil War. The percentage of increase in the wage earners of the South
Atlantic states between 1904 and 1909 was greater than in New England or
the Middle Atlantic states.

With this swift economic development, northern capital streamed into the
South; northern money was invested in southern public and industrial
securities in enormous amounts; and energetic northern business men were
to be found in southern market places vying with their no less
enterprising southern brethren. The men concerned in creating this new
nexus of interest between the two regions naturally deprecated the
perpetual agitation of sectional issues by the politicians, and
particularly northern interference in the negro question. Business
interest began to pour cold water on the hottest embers which the Civil
War had left behind.

FOOTNOTES:

[7] The following brief chronology of inventions illustrates the
rapidity in the technical changes in the new industrial development:

      1875--Bell's telephone in operation between Boston and
      Salem.

      1879--Brush arc street lighting system installed in San
      Francisco.

      1882--Edison's plant for incandescent lighting opened in New
      York City.

      1882--Edison's electric street car operated at Menlo Park,
      New Jersey.

      1885--Electric street railways in operation at Richmond,
      Virginia, and Baltimore.

     [8] For the keenest analysis of this social transformation,
     see Veblen, _Theory of the Leisure Class_ and _Theory of
     Business Enterprise_.

     [9] See below, Chaps. VI and VII.

     [10] See below, p. 234.

     [11] Youngman, _The Economic Causes of Great Fortunes_, p.
     75.

     [12] By an act passed in August, 1912, Congress provided a
     territorial legislature for Alaska, which had been governed
     up to that time by a governor appointed by the President and
     Senate, under acts of Congress.




CHAPTER III

THE REVOLUTION IN POLITICS AND LAW


The economic revolution that followed the War, the swift and potent
upswing of capitalism, and the shifting of political power from the
South to the North made their impress upon every branch of the Federal
Government. Senators of the old school, Clay, Webster, Calhoun, Roger
Baldwin, John P. Hale, James Mason, and Jefferson Davis were succeeded
by the apostles of the new order: Roscoe Conkling and Thomas Platt,
James Donald Cameron, Leland Stanford, George Hearst, Arthur P. Gorman,
William D. Washburn, John R. McPherson, Henry B. Payne, Matthew S. Quay,
Philetus Sawyer, John H. Mitchell, and James G. Blaine. The new Senate
was composed of men of affairs--practical men, who organized gigantic
enterprises, secured possession of natural resources and franchises,
collected and applied capital on a large scale to new business
undertakings, built railways, established cities with the advancing line
of the western frontier--or represented such men as counsel in the
courts of law.

Not many of them were great orators or widely known as profound students
of politics in its historical and comparative aspects. A few, like
Blaine, Hoar, and Conkling, studied the classic oratory of the older
generation and sought to apply to the controverted issues of the hour
that studious, orderly, and sustained eloquence which had adorned the
debates of earlier years; but the major portion cultivated only the arts
of management and negotiation. Few of them seem to have given any
thought to the lessons to be learned from European politics. On the
contrary, they apparently joined with the multitude in the assumption
that we had everything to teach Europe and nothing to learn. Bismarck
was to them, if we may judge from their spoken words, simply a great
politician and the hero of a war; the writings of German economists,
Wagner and Schmoller, appear never to have penetrated their studies.
That they foresaw in the seventies and eighties the turn that politics
was destined to take is nowhere evident. They commanded respect and
admiration for their practical achievements; but it is questionable
whether the names of more than two or three will be known a century
hence, save to the antiquarian.

Of this group, Roscoe Conkling was undoubtedly typical, just as Marcus
A. Hanna represented the dominant politicians of a later time. He was an
able lawyer and an orator of some quality, but of no permanent fame. He
took his seat in the Senate in 1867 and according to his biographer
"during the remainder of his life his legal practice was chiefly
connected with corporations that were litigants in the district and
circuit courts of the United States,"[13]--the judges of which courts he
was, as Senator, instrumental in appointing. His practice was lucrative
for his day, amounting to some $50,000 a year.[14] He counted among his
clients the first great capitalists of the country. When he was forced
to retire from New York politics, "the first person who came to see him
on business was Mr. Jay Gould, who waited upon him early one morning at
his hotel."[15] He was counsel for Mr. Collis P. Huntington in his
contest against the state legislation which railway interests deemed
unjust and unconstitutional.[16] He was among the keen group of legal
thinkers who invoked and extended the principle of the Fourteenth
Amendment to cover all the varieties of legislation affecting corporate
interests adversely.[17]

Criticism of the Republican party, and particularly of the policies for
which he stood, Mr. Conkling regarded as little short of treason. For
example, when Mr. George William Curtis, in the New York state
convention of 1877, sought to endorse the administration of President
Hayes, whose independence in office had been troublesome to Mr.
Conkling, the latter returned in a passionate attack on the whole party
of opposition: "Who are these men who in newspapers and elsewhere are
'cracking their whips' over Republicans and playing schoolmaster to the
Republican party and its conscience and convictions. They are of various
sorts and conditions. Some of them are the man-milliners, the dilettanti
and carpet knights of politics, men whose efforts have been expended in
denouncing and ridiculing and accusing honest men.... Some of these
worthies masquerade as reformers and their vocation and ministry is to
lament the sins of other people. Their stock in trade is rancid, canting
self-righteousness. They are wolves in sheep's clothing. Their real
object is office and plunder. When Dr. Johnson defined patriotism as the
last refuge of a scoundrel, he was then unconscious of the then
undeveloped capabilities of the word 'reform.'"[18]

The political philosophy of this notable group of political leaders was
that of their contemporaries in England, the Cobden-Bright school. They
believed in the widest possible extension of the principle of private
property, and the narrowest possible restriction of state interference,
except to aid private property to increase its gains. They held that all
of the natural resources of the country should be transferred to private
hands as speedily as possible, at a nominal charge, or no charge at all,
and developed with dashing rapidity. They also believed that the great
intangible social property created by community life, such as franchises
for street railways, gas, and electricity, should be transformed into
private property. They supplemented their philosophy of property by a
philosophy of law and politics, which looked upon state interference,
except to preserve order, and aid railways and manufacturers in their
enterprises, as an intrinsic evil to be resisted at every point, and
they developed a system of jurisprudence which, as Senators having the
confirming power in appointments and as counsel for corporations before
the courts of the United States, they succeeded in transforming into
judicial decisions. Some of them were doubtless corrupt, as was
constantly charged, but the real explanation of their resistance to
government intervention is to be found in their philosophy, which,
although consonant with their private interests, they identified with
public good.


_Writing Laissez Faire into the Constitution_

Inasmuch as the attacks on private rights in property, franchises, and
corporate privileges came principally from the state legislatures, it
was necessary to find some way to subject them to legal control--some
juristic process for translating _laissez faire_ into a real restraining
force. These leading statesmen and lawyers were not long in finding the
way. The Federal courts were obviously the proper instrumentalities, and
the broad restrictions laid upon the states by the Fourteenth Amendment
no less obviously afforded the constitutional foundation for the science
of legislative nihilism. "No state," ran the significant words of that
Amendment, "shall make or enforce any law which shall abridge the
privileges or immunities of citizens of the United States; nor shall any
state deprive any person of life, liberty, or property without due
process of law; nor deny to any person within its jurisdiction the equal
protection of the laws."

What unseen implications lay within these phrases the most penetrating
thinkers divined at once. Protest was made by the New Jersey legislature
against the Fourteenth Amendment in 1866 on the ground that it would
destroy all the essential rights of a state to control its internal
affairs; and such opinion was widespread. But the most common view was
to the effect that the Amendment would be used principally to surround
the newly emancipated slaves with safeguards against their former
masters who might be tempted to restore serfdom under apprentice and
penal laws and other legal guises. Still there is plenty of evidence to
show that those who framed the Fourteenth Amendment and pushed it
through Congress had in mind a far wider purpose--that of providing a
general restraining clause for state legislatures.

The problem of how best to check the assaults of state legislatures on
vested rights was not new when the Fourteenth Amendment was adopted. On
the contrary, it was one of the first concerns of the Convention of 1787
which drafted the original Constitution of the United States, and it was
thought by the framers that security had been attained by forbidding
states to emit bills of credit and make laws impairing the obligation of
contract. Under Chief Justice Marshall, these clauses were so generously
interpreted as to repel almost any attack which a state legislature
might make on acquired rights. However, in the closing years of
Marshall's service, the Supreme Court, then passing into the hands of
states' rights justices, rendered an opinion in the case of Ogden _v._
Saunders, which clearly held that the contract clause did not prevent
the legislature from stipulating that _future_ contracts might be
practically at its mercy. When a legislature provides by general law
that all charters of corporations are subject to repeal and alteration,
such provision becomes a part of all new contracts. Marshall delivered
in this case a vigorous and cogent dissenting opinion in which he
pointed out that the decision had in effect destroyed the virtue of the
obligation of contract clause.

The case of Ogden _v._ Saunders was decided in 1827. Between that year
and the Civil War the beginnings of corporate enterprise were securely
laid in the United States; and the legislatures of the several states
began the regulation of corporations from one motive or another,
sometimes for the purpose of blackmailing them and sometimes for the
laudable purpose of protecting public interests. At all events, large
propertied concerns began to feel that they could not have a free hand
in developing their enterprises or enjoy any genuine security unless the
legislatures of the states were, by some constitutional provision,
brought again under strict Federal judicial control.

The opportunity to secure this judicial control was afforded during the
Civil War when the radical Republicans were demanding Federal protection
for the newly emancipated slaves of the South. The drastic legislation
relative to negroes adopted by the southern states at the close of the
War showed that even in spite of the Thirteenth Amendment a substantial
bondage could be reestablished under the color of criminal, apprentice,
and vagrant legislation. The friends of the negroes, therefore,
determined to put the substantial rights of life, liberty, and property
beyond the interference of state legislatures forever, and secure to all
persons the equal protection of the law.

Accordingly, the Fourteenth Amendment was adopted, enunciating the
broad legal and political doctrine that no state "shall abridge the
privileges or immunity of citizens of the United States; nor shall any
state deprive any _person_ of life, liberty, or property without due
process of law; nor deny to any _person_ within its jurisdiction the
equal protection of the law."

Here was a restriction laid upon state legislatures which might be
substantially limitless in its application, in the hands of a judiciary
wishing to place the broadest possible interpretation upon it. What are
privileges and immunities? What are life, liberty, and property? What is
due process of law? What is the equal protection of the law? Does the
term "person" include not only natural persons but also artificial
persons, namely, corporations? That the reconstruction committee of
Congress which framed the instrument intended to include within the
scope of this generous provision not only the negro struggling upward
from bondage, but also corporations and business interests struggling
for emancipation from legislative interference, has been often asserted.
In arguing before the Supreme Court in the San Matteo County case, on
December 19, 1882, Mr. Roscoe Conkling, who had been a member of the
committee which drafted the Fourteenth Amendment, unfolded for the first
time the deep purpose of the committee, and showed from the journal of
that committee that it was not their intention to confine the amendment
merely to the protection of the colored race. In the course of his
argument, Mr. Conkling remarked, "At the time the Fourteenth Amendment
was ratified, as the records of the two Houses will show, individuals
and joint-stock companies were appealing for congressional and
administrative protection against invidious and discriminating state and
local taxes. One instance was that of an express company, whose stock
was owned largely by citizens of the State of New York, who came with
petitions and bills seeking Acts of Congress to aid them in resisting
what they deemed oppressive taxation in two states, and oppressive and
ruinous rules of damages applied under state laws. That complaints of
oppression in respect of property and other rights, made by citizens of
Northern States who took up residence in the South, were rife, in and
out of Congress, none of us can forget; that complaints of oppression in
various forms, of white men in the South,--of 'Union men,'--were heard
on every side, I need not remind the Court. The war and its results, the
condition of the freedmen, and the manifest duty owed to them, no doubt
brought on the occasion for constitutional amendment; but when the
occasion came and men set themselves to the task, the accumulated evils
falling within the purview of the work were the surrounding
circumstances, in the light of which they strove to increase and
strengthen the safeguards of the Constitution and laws."[19]

In spite of important testimony to the effect that those who drafted the
Fourteenth Amendment really intended "to nationalize liberty," that is
_laissez faire_, against state legislatures, the Supreme Court at first
refused to accept this broad interpretation, and it was not until after
several of the judges of the old states' rights school had been replaced
by judges of the new school that the claims of Mr. Conkling's group as
to the Fourteenth Amendment were embodied in copious judicial decisions.


_The Slaughter-House Cases_

The first judicial interpretation of the significant phrases of the
Fourteenth Amendment which were afterward to be the basis of judicial
control over state economic legislation of every kind was made by the
Supreme Court in the Slaughter-House cases in 1873--five years after
that Amendment had been formally ratified. These particular cases, it is
interesting to note, like practically all other important cases arising
under the Fourteenth Amendment, had no relation whatever to the newly
emancipated slaves; but, on the contrary, dealt with the regulation of
business enterprises.

In 1869, the legislature of Louisiana passed an act designed to protect
the health of the people of New Orleans and certain other parishes. This
act created a corporation for the purpose of slaughtering animals within
that city, forbade the establishment of any other slaughterhouses or
abattoirs within the municipality, and conferred the sole and exclusive
privilege of conducting the live-stock landing and slaughterhouse
business, under the limitations of the act, upon the company thus
created. The company, however, was required by the law to permit any
persons who wished to do so to slaughter in its houses and to make full
provision for all such slaughtering at a reasonable compensation. This
drastic measure, the report of the case states, was denounced "not only
as creating a monopoly and conferring odious and exclusive privileges
upon a small number of persons at the expense of the great body of the
community of New Orleans, but ... it deprives a large and meritorious
class of citizens--the whole of the butchers of the city--of the right
to exercise their trade, the business to which they have been trained
and on which they depend for the support of themselves and their
families."

The opinion of the court was rendered by Mr. Justice Miller. The Justice
opened by making a few remarks upon the "police power," in the course of
which he said that the regulation of slaughtering fell within the
borders of that mysterious domain and without doubt constituted one of
the powers enjoyed by all states previous to the adoption of the Civil
War amendments. After commenting upon the great responsibility devolved
upon the Court in construing the Thirteenth and Fourteenth amendments
and remarking on the careful deliberation with which the judges had
arrived at their conclusions, Justice Miller then turned to an
examination of the historical purpose which underlay the adoption of the
amendments in question. After his recapitulation of recent events, he
concluded: "On the most casual examination of the language of these
amendments, no one can fail to be impressed with the one pervading
purpose found in them all, lying at the foundation of each, and without
which none of them would have been even suggested; we mean the freedom
of the slave race, the security and firm establishment of that freedom,
and the protection of the newly-made freeman and citizen from the
oppression of those who had formerly exercised unlimited dominion over
him. It is true that only the Fifteenth Amendment, in terms, mentions
the negro by speaking of his color and his slavery. But it is just as
true that each of the other articles was addressed to the grievances of
that race and designed to remedy them as the Fifteenth. We do not say
that no one else but the negro can share in this protection. Both the
language and spirit of these articles are to have their fair and just
weight in any question of construction.... What we do wish to say and
what we wish to be understood as saying is, that in any fair and just
construction of any section or phrase of these amendments, it is
necessary to look to the purpose, which as we have said was the
pervading spirit of them all, the evil which they were designed to
remedy, and the process of continued addition to the Constitution until
that purpose was supposed to be accomplished as far as constitutional
law can accomplish it."

Justice Miller dismissed with a tone of impatience the idea of the
counsel for the plaintiffs in error that the Louisiana statute in
question imposed an "involuntary servitude" forbidden by the Thirteenth
Amendment. "To withdraw the mind," he said, "from the contemplation of
this grand yet simple declaration of the personal freedom of all the
human race within the jurisdiction of this government--a declaration
designed to establish the freedom of four million slaves--and with a
microscopic search endeavor to find it in reference to servitudes which
may have been attached to property in certain localities, requires an
effort, to say the least of it."

In Justice Miller's long opinion there is no hint of that larger and
more comprehensive purpose entertained by the framers of the Fourteenth
Amendment which was asserted by Mr. Conkling a few years later in his
argument before the Supreme Court. If he was aware that the framers had
in mind not only the protection of the freedmen in their newly won
rights, but also the defense of corporations and business enterprises
generally against state legislation, he gave no indication of the fact.
There is nowhere in his opinion any sign that he saw the broad economic
implications of the Amendment which he was expounding for the first time
in the name of the Court. On the contrary, his language and the opinion
reached in the case show that the judges were either not cognizant of
the new economic and political duty placed upon them, or, in memory of
the states' rights traditions which they had entertained, were unwilling
to apply the Thirteenth and Fourteenth amendments in such a manner as
narrowly to restrict the legislative power of a commonwealth.

In taking up that clause of the Fourteenth Amendment which provides that
no state shall make or enforce any law abridging the privileges or
immunities of citizens of the United States, Justice Miller declared
that it was not the purpose of that provision to transfer the security
and protection of all fundamental civil rights from the state
government to the Federal Government. A citizen of the United States as
such, he said, has certain privileges and immunities, and _it was these
and these only_ which the Fourteenth Amendment contemplated. He
enumerated some of them: the right of the citizen to come to the seat of
government, to assert any claim he may have upon that government, to
transact any business he may have with it, to seek its protection, share
its offices, engage in administering its functions, to have free access
to its seaports, subtreasuries, land offices, and courts of justice, to
use the navigable waters of the United States, to assemble peaceably
with his fellow citizens and petition for redress of grievances, and to
enjoy the privileges of the writ of habeas corpus. It was rights of this
character, the learned justice argued, and not all the fundamental
rights of person and property which had been acquired in the evolution
of Anglo-Saxon jurisprudence, that were placed by the Fourteenth
Amendment under the protection of the Federal Government.

Within this view, all the ordinary civil rights enjoyed by citizens were
still within the control of the organs of the state government and not
within Federal protection at all. If the privileges and immunities,
brought within the protection of the Federal Government by the
Fourteenth Amendment, were intended to embrace the whole domain of
personal and property rights, then, contended the justice, the Supreme
Court would be constituted "a perpetual censor upon all legislation of
the states, on the civil rights of their own citizens, with authority to
nullify such as it did not approve as consistent with those rights as
they existed at the time of the adoption of this Amendment.... We are
convinced that no such results were intended by the Congress which
proposed these amendments nor by the legislatures which ratified them."

In two short paragraphs, Justice Miller disposed of the contention of
the plaintiffs in error to the effect that the Louisiana statute
deprived the plaintiffs of their property without due process of law. He
remarked that inasmuch as the phraseology of this clause was also to be
found in the Fifth Amendment and in some form in the constitutions of
nearly all of the states, it had received satisfactory judicial
interpretation; "and it is sufficient to say," he concluded on this
point, "that under no construction of that provision that we have ever
seen or any that we deem admissible, can the restraint imposed by the
state of Louisiana upon the exercise of their trade by the butchers of
New Orleans be held to be a deprivation of private property within the
meaning of that provision."

Coming now to that clause requiring every state to give all persons
within its jurisdiction equal protection of the laws, Justice Miller
indulged in the false prophecy: "We doubt very much whether any action
of a state not directed by way of discrimination against the negroes as
a class or on account of their race will ever be held to come within the
purview of this provision." An emergency might arise, he admitted, but
he found no such a one in the case before him.

Concluding his opinion, he expressed the view that the American Federal
system had come out of the Civil War with its main features unchanged,
and that it was the duty of the Supreme Court then as always to hold
with a steady and an even hand the balance between state and Federal
power. "Under the pressure of all the excited feeling growing out of the
War," he remarked, "our statesmen have still believed that the existence
of the states with powers for domestic and local government, including
the regulation of civil rights--the rights of person and property--was
essential to the perfect working of our complex form of government,
though they have thought proper to impose additional limitations upon
the states and to confer additional power on that of the nation."

Under this strict interpretation of the Thirteenth and Fourteenth
amendments, all the fundamental rights of persons and property remained
subject to the state governments substantially in the same way as before
the Civil War. The Supreme Court thus could not become the final arbiter
and control the social and economic legislation of states at every
point. Those champions of the amendments who looked to them to establish
Federal judicial supremacy for the defense of corporations and business
enterprises everywhere throughout the American empire were sadly
disappointed.

Nowhere was that disappointment more effectively and more cogently
stated than in the opinions of the judges who dissented from the
doctrines announced by the majority of the court. Chief Justice Chase
and Justices Field, Bradley, and Swayne refused to accept the
interpretation and the conclusions reached by the majority, and the last
three judges wrote separate opinions of their own expressing their
grounds for dissenting. The first of these, Justice Field, contended
that the Louisiana statute in question could not legitimately come under
the police power and was in violation of the Fourteenth Amendment,
inasmuch as it denied to citizens of the United States the fundamental
rights which belonged to citizens of all free governments--protection
against monopolies and equality of rights in the pursuit of the ordinary
avocations of life. In his opinion, the privileges and immunities put
under the supervision of the Federal Government by the Fourteenth
Amendment comprised generally "protection by the government, the
enjoyment of life and liberty, with the right to acquire and possess
property of every kind, and to pursue and obtain happiness and safety,
subject, nevertheless, to such restraint as the government may justly
prescribe for the general good of the whole." In other words, Justice
Field would have carried the Amendment beyond the specific enumeration
of any definitely ascertained legal rights into the field of moral law,
which, in final analysis, would have meant the subjection of the state
legislation solely to the discretion of the judicial conscience. The
future, as we shall see, was with Justice Field.

In the opinion of Justice Bradley, the Louisiana statute not only
deprived persons of the equal protection of the laws, but also of
liberty and property--the right of choosing, in the adoption of lawful
employments, being a portion of their liberty, and their occupation
being their property. In the opinion of Mr. Justice Swayne, who
dissented also, the word liberty as used in the Fourteenth Amendment
embodied freedom from all restraints except such as were "justly"
imposed by law. In his view, property included everything that had an
exchange value, including labor, and the right to make property
available was next in importance to the rights of life and liberty.


_The Granger Cases_

Three years after the decision in the Slaughter-House cases, the Supreme
Court again refused to interpret the Fourteenth Amendment so broadly as
to hold unconstitutional a state statute regulating business
undertakings. This case, Munn _v._ Illinois, decided in 1876, involved
the validity of a statute passed under the constitution of that state,
which declared all elevators where grain was stored to be public
warehouses and subjected them to strict regulation, including the
establishment of fixed maximum charges. It was contended by the
plaintiffs in error, Munn and Scott, that the statute violated the
Fourteenth Amendment in two respects: (1) that the business attempted to
be regulated was not a public calling and was, therefore, totally
outside of the regulatory or police power of the state; and (2) that
even if the business was conceded to be public in character, and
therefore by the rule of the common law was permitted to exact only
"reasonable" charges for its services, nevertheless the determination of
what was reasonable belonged to the judicial branch of the government
and could not be made by the legislature without violating the principle
of "due process."

Both of these contentions were rejected by the Court, and the
constitutionality of the Illinois statute was upheld. The opinion of the
Court was written by Chief Justice Waite, who undertook an elaborate
examination of the "due process" clause of the Fourteenth Amendment. The
principle of this Amendment, he said, though new in the Constitution of
the United States, is as old as civilized government itself; it is found
in Magna Carta in substance if not in form, in nearly all of the state
constitutions, and in the Fifth Amendment to the Federal Constitution.
In order to ascertain, therefore, what power legislatures enjoyed under
the new amendment, it was only necessary to inquire into the limitations
which had been historically imposed under the due process clause in
England and the United States; and after an examination of some cases in
point the Chief Justice came to the conclusion that "down to the time of
the adoption of the Fourteenth Amendment it was not supposed that
statutes regulating the use or even the price of the use of private
property necessarily deprived an owner of his property without due
process of law." When private property "is affected with public
interest" and is used in a manner to make it of public consequence, the
public is in fact granted an interest in that use, and the owner of the
property in question "must submit to be controlled by the public for the
common good, to the extent of the interest he has thus created."

But it was insisted on behalf of the plaintiffs that the owner of
property is entitled to a reasonable compensation for its use even when
it is clothed with the public interest, and that the determination of
what is reasonable is a _judicial, not a legislative_, matter. To this
Chief Justice Waite replied that the usual practice had been otherwise.
"In countries where the common law prevails," he said, "it has been
customary from time immemorial for the legislature to declare what shall
be a reasonable compensation under such circumstances, or perhaps more
properly speaking to fix a maximum beyond which any charge made would be
unreasonable.... The controlling fact is the power to regulate at all.
If that exists, the right to establish the maximum of charge as one of
the means of regulation is implied. In fact, the common law rule which
requires the charge to be reasonable is itself a regulation as to
price.... To limit the rate of charge for services rendered in a public
employment, or for the use of property in which the public has an
interest, is only changing a regulation which existed before. It
establishes no new principle in the law, but only gives a new effect to
an old one. We know that this is a power which may be abused; but that
is no argument against its existence. _For protection against abuses by
legislatures the people must resort to the polls, not to the
courts._"[20]

The principle involved in the Munn case also came up in the same year
(1876) in Peik _v._ Chicago and Northwestern Railroad Company, in which
Chief Justice Waite, speaking of an act of Wisconsin limiting passenger
and freight charges on railroads in the state, said: "As to the claim
that the courts must decide what is reasonable and not the legislature,
this is not new to this case. It has been fully considered in Munn _v._
Illinois. Where property has been clothed with a public interest, the
legislature may fix a limit to that which shall be in law reasonable for
its use. This limit binds the courts as well as the people. If it has
been improperly fixed, the legislature, not the courts, must be appealed
to for the change."

The total results of the several Granger cases, decided in 1876, may be
summed up as follows:

(1) That the regulatory power of the state over "public callings" is not
limited to those businesses over which it was exercised at common law,
but extends to any business in which, because of its necessary character
and the possibilities for extortion afforded by monopolistic control,
the public has an interest.

(2) That such regulatory power will not be presumed to have been
contracted away by any legislature, unless such intention is
unequivocally expressed.

(3) That the exercise of such regulatory power belongs to the
legislature, and not to the judiciary.

(4) And the _dictum_ that the judiciary can grant no relief from an
unjust exercise of this regulatory power by the legislature.

Although the denial of the right of the judiciary to review the
"reasonableness" of a rate fixed by the legislature in the Granger cases
had been _dictum_, a case was not long arising in which the issue was
squarely raised. Had this case gone to the Supreme Court, the question
of judicial review would have been decided a full decade or more before
it really was. In this case, the Tilley case, a bondholder of a railroad
operating in Georgia sought to restrain the railroad from putting into
force a tariff fixed by the state railroad commission, on the ground
that it was so unreasonably low as to be confiscatory. Judge Woods, of
the Federal circuit court, refused to grant the injunction, basing his
decision squarely upon the dictum in Munn _v._ Illinois, and declaring
that the railroad must seek relief from unjust action on the part of the
commission at the hands of the legislature or of the people.

It was not till seven years after the Granger cases that another case
involving rate regulation was presented to the Federal courts.[21] The
Ruggles case, brought to the Supreme Court by writ of error to the
supreme court of Illinois, in 1883, involved a conviction of one of the
agents of the Illinois Central Railway for violating a maximum passenger
fare statute of that state, and raised substantially the same question
as all of the Granger cases except the Munn case--the right of the
legislature to regulate the rates of a railroad which was itself
empowered by its charter to fix its own rates. The Court affirmed the
doctrine of the Granger cases, Chief Justice Waite again writing the
opinion. The case is noteworthy only for the opinion of Justice Harlan,
concurring in the judgment, but dissenting from the opinion, of the
Court, in so far as that opinion expressed, as he declared, the doctrine
that the legislature of Illinois could regulate the rates of the railway
concerned, in any manner it saw fit. Justice Harlan argued that inasmuch
as the charter of the railroad had conferred upon it the right to demand
"reasonable" charges, the legislature, when it resumed the power of
fixing charges, was estopped from fixing less than "reasonable" charges;
and should charges lower than "reasonable" be fixed, it would be within
the province of the judicial branch to give relief against such an
impairment of the obligation of contract.

Justice Harlan's opinion is interesting not only because it touches upon
the possibility of a _judicial_ review of the rate fixed by the
legislature; but because the learned Justice bases his contention on the
_contract_ between the railroad and the state to the effect that rates
should be "reasonable." This indicates plainly that not even in the mind
of Justice Harlan, who later became the firm exponent of the power of
judicial review, was there any clear belief that the Fourteenth
Amendment as such gave the Court any power to review the
"reasonableness" of a rate fixed by the legislature. In other words, he
derived his doctrine of judicial review from the power of the Federal
judiciary to enforce the obligation of contracts, and not from its power
to compel "due process of law."

It is impossible to trace here the numerous decisions following the
Ruggles case in which the Supreme Court was called upon to consider the
power of state legislatures to control and regulate corporations,
particularly railways. It is impossible also to follow out all of the
fine and subtle distinctions by which the _dictum_ of Chief Justice
Waite, in the Munn case, to the effect that private parties must appeal
to the people, and not to the courts, for protection against state
legislatures, was supplanted by the firm interpretation of the
Fourteenth Amendment in such a manner as to confer upon the courts the
final power to review all state legislation regulating the use of
property and labor. Of course we do not have, in fact, this clear-cut
reversal of opinion by the Court, but rather a slow working out of the
doctrine of judicial review as opposed to an implication that the Court
could not grant to corporations the relief from legislative interference
which they sought. There are but few clear-cut reversals in law; but the
political effect of the Court's decisions has been none the less clear
and positive.


_The Minnesota Rate Case_

It seems desirable, however, to indicate some of the leading steps by
which the Court moved from the doctrine of non-interference with state
legislatures to the doctrine that it is charged with the high duty of
reviewing all and every kind of economic legislation by the states. One
of the leading cases in this momentous transition is that of the
Chicago, Milwaukee, and St. Paul Railway Company _v._ Minnesota, decided
in 1889, which made a heavy contribution to the doctrine of judicial
review of questions of political economy as well as law. This case
involved the validity of a Minnesota law which conferred upon a state
railway commission the power to fix "reasonable" rates. The commission,
acting under this authority, had fixed a rate on the transportation of
milk between two points.

The railroad having refused to put the rate into effect, the commission
applied to the supreme court of the state for a writ of mandamus. In its
answer the railroad claimed, among other contentions, that the rate
fixed was unreasonably low. The supreme court of the state refused to
listen to this contention, saying that the statute by its terms made the
order of the commission conclusively reasonable; accordingly it issued
the mandamus. By writ of error, the case was brought to the Supreme
Court of the United States, which, by a vote of six to three, ordered
the decree of the state court vacated, on the ground that the statute as
construed by the supreme court of the state was unconstitutional, as a
deprivation of property without due process of law.

The opinion of the Court, written by Justice Blatchford, has frequently
been interpreted to hold, and was indeed interpreted by the dissenting
minority to hold, that the judiciary must, to satisfy the requirements
of "due process," have the power of final review over the reasonableness
of all rates, however fixed. It is doubtful whether the language of the
opinion sustains this reading; but the strong emphasis on the place of
the judiciary in determining the reasonableness of rates lent color to
the contention that Mr. Justice Blatchford was setting up "judicial
supremacy." In the course of his opinion, he said: "The question of the
reasonableness of a rate of charge for transportation by a railroad
company, involving as it does the element of reasonableness both as
regards the company and as regards the public, is eminently a question
for judicial investigation requiring due process of law for its
determination. If the company is deprived of the power of charging
reasonable rates for the use of its property, and such deprivation takes
place in the absence of an investigation by judicial machinery, it is
deprived of the lawful use of its property, and thus in substance and
effect, of the property itself without due process of law and in
violation of the Constitution of the United States."

The dissenting members of the Court in this case certainly saw in
Justice Blatchford's opinion an assertion of the doctrine that whatever
the nature of the commission established by law or the form of procedure
adopted, the determination of rates was subject to review by a strictly
judicial tribunal. In his dissent, Mr. Justice Bradley declared that the
decision had practically overruled Munn _v._ Illinois and the other
Granger cases. "The governing principle of those cases," he said, "was
that the regulation and settlement of the affairs of railways and other
public accommodations is a legislative prerogative and not a judicial
one.... The legislature has the right, and it is its prerogative, if it
chooses to exercise it, to declare what is reasonable. This is just
where I differ from the majority of the Court. They say in effect, if
not in terms, that the final tribunal of arbitrament is the judiciary; I
say it is the legislature. I hold that it is a legislative question, not
a judicial one, unless the legislature or the law (which is the same
thing) has made it judicial by prescribing the rule that the charges
shall be reasonable and leaving it there. It is always a delicate thing
for the courts to make an issue with the legislative department of the
government, and they should never do it, if it is possible to avoid it.
By the decision now made we declare, in effect, that the judiciary, and
not the legislature, is the final arbiter in the regulation of fares and
freights of railroads and the charges of other public accommodations. It
is an assumption of authority on the part of the judiciary which, it
seems to me, with a due reverence to the judgment of my brethren, it has
no right to make.... Deprivation of property by mere arbitrary power on
the part of the legislature or fraud on the part of the commission are
the only grounds on which judicial relief may be sought against their
action. There was in truth no deprivation of property in these cases at
all.... It may be that our legislatures are invested with too much
power, open as they are to influences so dangerous to the interests of
individuals, corporations, and societies. But such is the Constitution
of our republican form of government, and we are bound to abide by it
until it can be corrected in a legitimate way."


_The Development of Judicial Review_

A further step toward judicial review even still more significant was
taken, in the case of Reagan _v._ Farmers' Loan and Trust Company,
decided by the Supreme Court in 1894. This case came up from the Federal
circuit court of Texas which had enjoined the state railway
commissioners from fixing and putting into effect railway rates which
the Trust Company, as a bondholder and interested party, contended were
too low, although not confiscatory.

The opinion of the Court, written by Justice Brewer, who, as Federal
circuit judge, had already taken advanced ground in favor of judicial
review, went the whole length in upholding the right of the judiciary to
review the reasonableness, not only of a rate fixed by a commission, as
in the case in hand, but even of one fixed by the legislature. The case
differed in no essential way, declared the justice, from those cases in
which it had been the age-long practice of the judiciary to act as final
arbiters of reasonableness--cases in which a charge exacted by a common
carrier was attacked by a shipper or passenger as unreasonable. The
difference between the two cases was merely that in the one the rate
alleged to be unreasonable was fixed by the carrier; in the other it was
fixed by the commission or by the legislature. In support of this
remarkable bit of legal reasoning, the opinion adduced as precedents
merely a few brief excerpts, from previous decisions of the Court,
nearly all of which were pure _dicta_.

The absence of any dissent from this opinion, in spite of the fact that
Judge Gray, who had concurred in Justice Bradley's vigorous dissenting
opinion in the Chicago-Minnesota case four years before, was still on
the bench, indicates that the last lingering opposition to the doctrine
of judicial review in the minds of any of the Court had been dissolved.
Henceforth it was but the emphatic affirmation and consistent
development of that doctrine that was to be expected.

If we leave out of account Mr. Justice Brewer's _dicta_ and consider the
Court to have decided merely the issues squarely presented, the Reagan
case left much to be done before the doctrine of judicial review could
be regarded as established beyond all possibility of limitation and
serious qualification. Other cases on the point followed quickly, but it
was not until the celebrated case of Smyth _v._ Ames, decided in 1898,
that the two leading issues were fairly presented and settled. In this
case the rate attacked was not fixed by a commission, but by a state
legislature itself; and the rate was not admitted by the counsel for the
state to be unreasonable, but was strongly defended as wholly reasonable
and just. The Court had to meet the issues.

The original action in the case of Smyth _v._ Ames was a bill in equity
brought against the attorney-general and the Nebraska state board of
transportation, in the Federal circuit court, by certain bondholders of
the railroads affected, to restrain the enforcement of the statute of
that state providing a comprehensive schedule of freight rates. The
bills alleged, and attempted to demonstrate by elaborate calculations,
that the rates fixed were _confiscatory_, inasmuch as a proportionate
reduction on all the rates of the railroads affected by them would so
reduce the income of the companies as to make it impossible for them to
pay any dividends; and in the case of some of them, even to meet all
their bonded obligations. On behalf of the state, it was urged that the
reduction in rates would increase business, and, therefore, increase
net earnings, and that some at least of the companies were bonded far
in excess of their actual value. Supreme Court Justice Brewer, sitting
in circuit, on the basis of the evidence submitted to him, consisting
mainly of statements of operating expenses, gross receipts, and inter-
and intra-state tonnage, found the contention of the railroads well
taken, and issued the injunctions applied for.

The opinion of the Supreme Court, affirming the decree of Judge Brewer,
was, in the essential part of it--that asserting the principle of
judicial review in its broadest terms--singularly brief. Contenting
himself with citing a few short _dicta_ from previous decisions, Justice
Harlan, speaking for the Court, declared that the principle "must be
regarded as settled" that the reasonableness of a rate could not be so
conclusively determined by a legislature as to escape review by the
judiciary. Equally well settled, it was declared, was the principle that
property affected with a public interest was entitled to a "fair return"
on its "fair" valuation. These principles regarded as established, the
Court proceeded to examine the evidence, although it admitted that it
lacked the technical knowledge necessary to a completely equitable
decision; and sustained the finding of the lower court in favor of the
railroads. There was no dissent.

With Smyth _v._ Ames the doctrine of judicial review may be regarded as
fully established. No portion of the judicial prerogative could now be
surrendered without not merely "distinguishing" but flatly overruling a
unanimous decision of the Court.

The significance of Smyth _v._ Ames was soon observable in the
activities of the lower Federal courts. Within the nine months of 1898
that followed that decision, there were at least four applications for
injunctions against alleged unreasonable rates, and in three of these
cases the applications were granted. During the years that followed
Smyth _v._ Ames, Federal courts all over the country were tying the
hands of state officers who attempted to put into effect legislative
measures regulating railway concerns. In Arkansas, Florida, Alabama,
Minnesota, Missouri, Illinois, North Carolina, Louisiana, and Oregon,
rates fixed by statute, commission, or ordinance were attacked by the
railways in the Federal courts and their enforcement blocked. In several
instances the injunctions of the lower courts were made permanent, and
no appeal was taken to the Supreme Court of the United States. With
Smyth _v._ Ames staring them in the face, state attorneys accepted the
inevitable.

The decision in Smyth _v._ Ames left still one matter in doubt. The
allegation of the railroads in that case had been that the rates fixed
were actually confiscatory--that is, so low as to make dividends
impossible. In the course of his opinion, Justice Harlan had stated,
however, that the railroads were entitled to a "fair return," an opinion
that had been expressed also in the Reagan case, where indeed it had
been necessary to the decision, and still earlier, but with little
relevancy, in the Chicago-Minnesota case. In none of these cases,
however, had any precise definition of the terms "reasonable" or "fair"
return been necessary, and none had been made.

The first direct suggestion of the development of the judicial
reasoning on this point that was to take place is found in the Milwaukee
Electric Railway case, also decided in 1898. In that case Judge Seaman,
of the Federal circuit court, found from the evidence that the dividends
of the street railway company for several years past had been from 3.3
to 4.5 per cent, while its bonds bore interest at 5 per cent. Anything
less than these returns, the judge declared, would be unreasonable,
inasmuch as money loaned on real estate, secured by a first mortgage,
was at that time commanding 6 per cent in Milwaukee.

Eleven years later, in 1909, the Supreme Court sustained virtually the
same rule in the New York Consolidated Gas case, holding, with the lower
court, that the company was entitled to _six_ per cent return on a fair
value of its property (including franchises and the high values of the
real estate used by it in the business), because six per cent was the
"customary" rate of interest at that time in New York City. On the same
day the court decided that a return of six per cent on waterworks
property in Knoxville, Tennessee, was also not unreasonable. In neither
of these cases, however, did the Court attempt any examination or
explanation of the evidence on which it rested its determination that
six per cent was the "customary" rate in the places named; nor did it
attempt to explain the principle on which such "customary" rate could be
determined for other times and places. Plainly there is still room for a
great deal of "distinguishing" on this point. The extreme vagueness of
the rule was exemplified by the decision of Federal circuit Judge
Sanborn in the Shephard case (1912), in which he decided that, for a
railroad running through Minnesota, _seven_ per cent was no more than a
"fair" return, and that any reduction in rates which would diminish the
profits of the road below that figure was unreasonable.

Equally important and of as great difficulty are the questions entering
into the determination of a "fair" valuation. This point is both too
unsettled and too technical to render any discussion of it profitable
here. Attention may, however, be called to two of the holdings in the
Consolidated Gas case. In arriving at a "fair" valuation of the gas
company's property, the Court allowed a large valuation to be placed
upon the franchises of the company--none of which had been paid for by
the companies to which they had originally been issued, and which had
not been paid for by the Consolidated Company when it took them over,
except in the sense that a large amount of stock, more than one sixth of
the total stock issued by the company, had been issued against them,
when the consolidation was formed. The particular facts surrounding this
case are such as to make it very easy for the Court to "distinguish"
this case from the usual one, for the consolidation was formed, and its
stock issued, under a statute that authorized the formation of
consolidations, and forbade such consolidations to issue stock in excess
of the fair value of the "property, franchises, and rights" of the
constituent companies. This last prohibition the Court construed as
indicative of the legislative intention that the franchises should be
capitalized. Equally plain is it, however, that this particular
circumstance of the Consolidated Gas case is so irrelevant that it will
offer no obstacle whatever to the Court's quoting that case as a
precedent for the valuation of franchises obtained _gratis_, should it
so desire.

Another holding of great importance in the Gas case was that the company
was entitled to a fair return on the value of real estate used in the
business, that value having appreciated very greatly since the original
purchase of the real estate, and there being no evidence to show that
real estate of so great value was essential to the conduct of the
business.

The importance of these two holdings is exemplified by the fact that in
this particular case the combined value attributed to the franchises and
the appreciation of real estate was over $15,000,000--more than one
fourth of the total valuation arrived at by the Supreme Court. It will
readily be seen that if these two items had been struck from the
valuation by the Court, it would be possible for the state to make a
still further substantial reduction in the rate charged for gas in New
York City without violating the Court's own canon of reasonableness--a
six per cent return.

The steps in the evolution of the doctrine of judicial review may be
summarized in the following manner:

The Supreme Court first declared that the legislative determination of
what was a "reasonable" rate was not subject to review by the courts.

The first departure from this view was an intimation, confirmed with
increasing emphasis in several cases, that a rate so low as to make any
return whatever impossible was confiscatory and would be set aside by
the Court as violating the Fourteenth Amendment. For a time, however,
the Court took the position (steadily undermined in subsequent
decisions) that a rate which allowed some, even though an "unreasonably
low" return, was not prohibited by the Fourteenth Amendment and could
not be set aside by the Court.

Next in order came the holding that the determination of a commission as
to what was reasonable could not be made conclusive upon the courts, at
least when the commission had acted without the forms and safeguards of
judicial procedure, and, probably, even when it had acted with them.

In the same decision appeared an intimation, which in subsequent
decisions became crystallized into "settled law," that not only were
totally confiscatory rates prohibited by the Fourteenth Amendment, but
also any rates which deprived the owners of the property regulated of a
return equal to what was "customary" in private enterprises.

This rule was applied by the Court for the first time against a rate
fixed by a commission, and where the rate was admitted by the pleadings
to be confiscatory. But it was shortly thereafter applied to a rate
fixed by a legislature, and where the "reasonableness" (not the
confiscatory character) of the rate was a direct issue on the facts and
evidence.

Finally, the principle that what is a "fair" or "reasonable" rate is to
be measured by the customary return in private enterprises under similar
conditions, has been applied in several cases to warrant the requirement
of a definite rate of interest; but no precise rules have been laid down
for the determination of such rate in all cases.

The most striking feature, perhaps, of the development of the doctrine
of judicial review here traced, as seen in the opinions of the Supreme
Court, is the brevity and almost fortuitous character of the reasoning
given in support of the most important and novel holdings. A comparison
of the reasoning in Smyth _v._ Ames, for example, with that in Marbury
_v._ Madison, in which Chief Justice Marshall first held a law of
Congress unconstitutional, will forcibly exemplify this. The explanation
is to be found largely in the fact that each step in advance in the
building up of the doctrine had been foreshadowed in _dictum_ before it
was established as decision. It was thus possible for the judge writing
the opinion in a case when a new rule was actually established, to
quote, as "settled law," a mere _dictum_ from a previous opinion.
Justice Gray's citation, in this fashion, in the Dow case, of Chief
Justice Waite's _dictum_ in the Ruggles case (although he might, with
equal cogency, have cited the Chief Justice's contrary _dictum_ in the
Munn or Peik cases), is a good instance of this curious use of
"precedent"; and parallel instances could be adduced from virtually
every one of the important subsequent cases on this subject.[22]

It is apparent from this all too brief and incomplete account of the
establishment of judicial review over every kind and class of state
legislation affecting private property rights that no layman can easily
unravel the mysterious refinements, distinctions, and logical subtleties
by which the fact was finally established that property was to be free
from all interference except such as might be allowed by the Supreme
Court (or rather five judges of that Court) appointed by the President
and Senate, thus removed as far as possible from the pressure of public
sentiment. Had a bald veto power of this character been suddenly vested
in any small group of persons, there can be no doubt that a political
revolt would have speedily followed. But the power was built up by
gradual accretions made by the Court under the stimulus of skilful
counsel for private parties, and finally clothed in the majesty of
settled law. It was a long time before the advocates of leveling
democracy, leading an attack on corporate rights and privileges,
discovered that the courts were the bulwarks of _laissez faire_ and
directed their popular battalions in that direction.

Those who undertake to criticize the Supreme Court for this assumption
of power do not always distinguish between the power itself and the
manner of its exercise. What would have happened if the state
legislatures had been given a free hand to regulate, penalize, and
blackmail corporations at will during the evolution of our national
economic system may be left to the imagination of those who recall from
their history the breezy days of "wild-cat" currency, repudiation, and
broken faith which characterized the thirty years preceding the Civil
War when the Federal judiciary was under the dominance of the states'
rights school. The regulation of a national economic system by forty or
more local legislatures would be nothing short of an attempt to combine
economic unity with local anarchy. It is possible to hold that the Court
has been too tender of corporate rights in assuming the power of
judicial review, and at the same time recognize the fact that such a
power, vested somewhere in the national government, is essential to the
continuance of industries and commerce on a national scale.

       *       *       *       *       *

Thus far attention has been directed to the activities of the Federal
Supreme Court in establishing the principle of judicial review
particularly in connection with legislation relative to railway
corporations, but it should be noted that judicial review covers all
kinds of social legislation relative to hours and conditions of labor as
well as the charges of common carriers. In 1905, for example, the
Supreme Court in the celebrated case of Lochner _v._ New York declared
null and void a New York law fixing the hours of work in bakeshops at
ten per day, basing its action on the principle that the right to
contract in relation to the hours of labor was a part of the liberty
which the individual enjoyed under the Fourteenth Amendment. Mr. Justice
Holmes, who dissented in the case, declared that it was decided on an
economic theory which a large part of the country did not entertain, and
protested that the Fourteenth Amendment did not "enact Mr. Herbert
Spencer's _Social Statics_."

As a matter of fact, however, the Supreme Court of the United States has
declared very little social legislation invalid, and has been inclined
to take a more liberal view of such matters than the supreme courts of
the states. The latter also have authority to declare state laws void as
violating the Federal Constitution, and when a state court of proper
jurisdiction invalidates a state law, there is, under the Federal
judiciary act, no appeal to the Supreme Court of the United States.
Consequently, the Fourteenth Amendment means in each state what the
highest court holds it to mean, and since the adoption of that Amendment
at least one thousand state laws have been nullified by the action of
state courts, under the color of that Amendment or their respective
state constitutions.

As examples, in New York a law prohibiting the manufacture of cigars in
tenement houses, in Pennsylvania a law prohibiting the payment of wages
in "scrip" or store orders, and in Illinois a statute forbidding mining
and manufacturing corporations to hold back the wages of their employees
for more than a week were declared null and void. Such laws were
nullified not only on the ground that they deprived the employer of
property without due process, but also on the theory that they deprived
workingmen of the "liberty" guaranteed to them to work under any
conditions they chose. In one of these cases, a Pennsylvania court
declared the labor law in question to be "an insulting attempt to put
the laborer under a legislative tutelage which is not only degrading to
his manhood but subversive of his rights as a citizen of the United
States."

Where the state court nullified under the state constitution, it was of
course relatively easy to set aside the doctrines of the court by
amending the constitution, but where the state court nullified on the
ground of the Fourteenth Amendment to the Federal Constitution, there
was no relief for the state and even no appeal for a review of the case
to discover whether the Supreme Court of the United States would uphold
the state tribunal in its view of the national law. Under such
circumstances, the highest state court became the supreme power in the
state, for its decrees based on the Federal Constitution were final. It
was the freedom, one may say, recklessness, with which the courts
nullified state laws that was largely responsible for the growth of the
popular feeling against the judiciary, and led to the demand for the
recall of judges.[23]

FOOTNOTES:

     [13] A. R. Conkling, _Life of Roscoe Conkling_, p. 297.

     [14] A. R. Conkling, _Life of Roscoe Conkling_, p. 699.

     [15] _Ibid._, p. 671.

     [16] _Ibid._, pp. 679 ff.

     [17] See below, p. 57.

     [18] _Ibid._, p. 540.

     [19] Taylor, _Origin and Growth of the American
     Constitution_, p. 355. As a matter of fact, Conkling, who was
     a member of the committee that drafted the Fourteenth
     Amendment, voted against these provisions in Committee.

     [20] It is to be noted that the demand of the warehousemen on
     the second point was not for a judicial _review_ of the
     reasonableness of a rate fixed by the legislature, but a
     total _denial_ of the _power_ of a _legislature_ to act in
     the matter. The question of the propriety of a judicial
     review of the reasonableness of the rates in question was not
     raised in the pleadings. It was not difficult, therefore, for
     judges in subsequent cases in which the question of judicial
     review was squarely raised to explain away as mere _dictum_
     this solemn statement by Chief Justice Waite to the effect
     that the power of the legislature to regulate being conceded,
     the determination of the legislature was binding on the
     courts and not subject to review.

     [21] Except for two unimportant cases decided in the lower
     courts.

     [22] It should be noted that the Supreme Court not only
     undertook to pass upon the reasonableness of such rates as
     the states were permitted to make, but also added in 1886
     that no state could regulate the rates on goods transported
     within its borders, when such goods were in transit to or
     from a point in another state. Such regulation was held in
     the Wabash, etc., Railway Company _v._ Illinois (118 U. S.
     557) to be an interference with interstate commerce which was
     subject to control by Congress only.

     [23] Below, p. 287.




CHAPTER IV

PARTIES AND PARTY ISSUES, 1877-1896


It was a long time before the conditions created by the great economic
revolution were squarely reflected in political literature and party
programs. Indeed, they were but vaguely comprehended by the generation
of statesmen who had been brought up in the days of the stagecoach and
the water mill. It is true that the inevitable drift of capitalism in
the United States might have been foreseen by turning to Europe,
particularly to England, where a similar economic revolution had
produced clearly ascertainable results; but American politicians
believed, or at least contended, that the United States lived under a
special economic dispensation and that the grave social problems which
had menaced Europe for more than a generation when the Civil War broke
out could never arise on American soil.

From 1861 to 1913, the Republican party held the presidential office,
except for eight years. That party had emerged from the Civil War
fortified by an intense patriotism and by the support of the
manufacturing interests which had flourished under the high tariffs and
of capitalists anxious to swing forward with the development of railways
and new enterprises. Its origin had been marked by a wave of moral
enthusiasm such as has seldom appeared in the history of politics. It
came to the presidency as a minority party, but by the fortunes of war
it became possessed of instruments of power beyond all calculation. Its
leading opponents from the South deserted in a mass giving it in a short
time possession of the field--all the Federal branches of government. It
had the management of the gigantic war finances, through which it
attached to itself the interests and fortunes of the great capitalists
and bankers throughout the North. It raised revenues by a high tariff
which placed thousands of manufacturers under debt to it and linked
their fortunes also with its fate. It possessed the Federal offices,
and, therefore, railway financiers and promoters of all kinds had to
turn to it for privileges and protection. Finally, millions of farmers
of the West owed their homes to its generous policy of giving away
public lands. Never had a party had its foundations on interests
ramifying throughout such a large portion of society.

And over all it spread the mantle of patriotism. It had saved the Union,
and it had struck the shackles from four million bondmen. In a baptism
of fire it had redeemed a nation. Europe's finger of scorn could no
longer be pointed to the "slave republic paying its devotions to liberty
and equality within the sound of the bondman's wail." The promises of
the Declaration of Independence had been fulfilled and the heroic deeds
of the Revolution rivaled by Republican leaders. As it declared in its
platform of 1876, the Republican party had come into power "when in the
economy of Providence this land was to be purged of human slavery and
when the strength of the government of the people, by the people, and
for the people was to be demonstrated." Incited by the memories of its
glorious deeds "to high aims for the good of our country and mankind,"
it looked forward "with unfaltering courage, hope, and purpose."

Against such a combination of patriotism and economic interest, the
Democratic party had difficulty in making headway, for its former
economic mainstay, the slave power, was broken and gone; it was charged
with treason, and it enjoyed none of the spoils of national office. But
in spite of all obstacles it showed remarkable vitality. Though divided
on the slave question in 1860, those who boasted the name of "Democrat"
were in an overwhelming majority, and even during the Civil War, with
the southern wing cut off completely, the party was able to make a
respectable showing in the campaign which resulted in Lincoln's second
election. When the South returned to the fold, and white dominion drove
the negro from the polls, the Democratic party began to renew its youth.
In the elections of 1874, it captured the House of Representatives; it
narrowly missed the presidency in 1876; and it retained its control of
the lower house of Congress in the elections of 1876 and 1878.

       *       *       *       *       *

The administration of President Hayes did little to strengthen the
position of the Republicans. His policy of pacification in the South
alienated many partisans who believed that those who had saved the Union
should continue to rule it; but it is difficult to say how much
disaffection should be attributed to this cause. It seems to have been
quietly understood within official circles that support would be
withdrawn from the Republican administrations in Louisiana and South
Carolina. Senator Hoar is authority for the statement "that General
Grant, before he left office, had determined to do in regard to these
state governments exactly what Hayes afterward did, and that Hayes acted
with his full approval. Second, I have the authority of President
Garfield for saying that Mr. Blaine had come to the same conclusion."

Charges based on sectional feeling were also brought forward in
criticism of some of Hayes' cabinet appointments. He terrified the
advocates of "no concession to rebels" by appointing David M. Key, an
ex-Confederate soldier of Tennessee, to the office of Postmaster-General;
and his selection of Carl Schurz, a leader of the Liberal Republican
Movement of 1872 and an uncertain quantity in politics, as Secretary of
the Interior, was scarcely more palatable in some quarters. He created
further trouble in Republican ranks by his refusal to accede to the
demands of powerful Senators, like Cameron of Pennsylvania and Conkling
of New York, for control over patronage in their respective states. No
other President for more than a generation had so many nominations
rejected by the Senate.

On the side of legislation, Hayes' administration was nearly barren.
During his entire term the House of Representatives was Democratic, and
during the last two years the Senate was Democratic also by a good
margin. Had he desired to carry out a large legislative policy, he could
not have done so; but he was not a man of great capacity as an initiator
of public policies. He maintained his dignity and self-possession in
the midst of the most trying party squabbles; but in a democracy other
qualities than these are necessary for effective leadership.

       *       *       *       *       *

In their desperation, the conservative leaders of the Republican party
resolved to have no more "weak and goody-goody" Presidents, incapable of
fascinating the populace and keeping it in good humor, and they made a
determined effort to secure the renomination of Grant for a third term,
in spite of the tradition against it. Conkling captured the New York
delegation to the national convention in 1880 for Grant; Cameron swung
Pennsylvania into line; and Logan carried off Illinois. Grant's consent
to be a candidate was obtained, and Conkling placed his name in
nomination in a speech which Senator Hoar describes as one of "very
great power."

Strong opposition to Grant developed, however, partly on account of the
feeling against the third term, and particularly on account of the
antagonism to the Conkling faction which was backing him. Friends of
Blaine, then Senator from Maine, and supporters of John Sherman of Ohio,
thought that Grant had had enough honors at the hands of the party, and
that their turn had come. As a result of a combination of circumstances,
Grant never received more than 313 of the 378 votes necessary to
nomination at the Republican convention. After prolonged balloting, the
deadlock was broken by the nomination of James A. Garfield, of Ohio, as
a "dark horse." The Grant contingent from New York received a sop in
the shape of the nomination of Chester A. Arthur, a politician of the
Conkling school, to the office of Vice President.

In spite of the promising signs, the Democrats were unable to defeat the
Republicans in 1880. The latter found it possible to heal, at least for
campaign purposes, the breaches created by Hayes' administration. It is
true that Senator Conkling and the "Stalwart" faction identified with
corporation interests were sorely disappointed in their failure to
secure the nomination of Grant for a third term, and that Garfield as a
"dark horse" did not have a personal following like that of his chief
opponents, the Hero of Appomattox, Blaine of Maine, and Sherman of Ohio.
But he had the advantage of escaping the bitter factional feeling within
the party against each of these leaders. He had risen from humble
circumstances, and his managers were able to make great capital out of
his youthful labors as a "canal-boat boy." He had served several terms
in Congress acceptably; he had been intrusted with a delicate place as a
member of the electoral commission that had settled the Hayes-Tilden
dispute; and he was at the time of his nomination Senator-elect from
Ohio. Though without the high qualities of leadership that distinguished
Blaine, Garfield was a decidedly "available" candidate and his
candidature was strengthened by the nomination of Arthur, who was
acceptable to the Conkling group and the spoilsmen generally.

The Republican fortunes in 1880 were further enhanced by the divisions
among the Democrats and their inability to play the game of practical
politics. Two sets of delegates appeared at the convention from New
York, and the Tammany group headed by "Boss" Kelly was excluded, thus
offending a powerful section of the party in that pivotal state. The
candidate nominated, General Hancock, was by no means a skilful leader.
In fact, he had had no public experience outside of the Army, where he
had made a brilliant record, and he showed no ability at all as a
campaigner. Finally, the party made its fight principally on the "great
fraud of 1876," asking vindication at the hands of the people on the
futile theory that the voters would take an interest in punishing a
four-year-old crime. In its platform, reported by Mr. Watterson, of
Kentucky, it declared that the Democrats had submitted to that outrage
because they were convinced that the people would punish the crime in
1880. "This issue precedes and dwarfs every other; it imposes a more
sacred duty upon the people of the Union than ever addressed to the
conscience of a nation of freemen." Notwithstanding this narrow issue,
Hancock fell behind Garfield only about ten thousand votes, although his
electoral vote was only 155 to 214 for his opponent.

Whether Garfield would have been able to consolidate his somewhat
shattered party by effective leadership is a matter of speculation, for,
on July 2, 1881, about four months after his inauguration, he was shot
by Charles J. Guiteau, a disappointed and half-crazed office seeker, and
he died on September 19. His successor, Vice President Arthur, though a
man of considerable ability, who managed his office with more acumen and
common honesty than his opponents attributed to him, was unable to clear
away the accumulating dissatisfaction within his party or convince the
country that the party would do its own reforming.

In fact, Arthur, notwithstanding the taint of "spoils" associated with
his career, proved to be by no means the easy-going politician that had
been expected. He took a firm stand against extravagant appropriations
as a means of getting rid of the Treasury surplus, and in 1882 he vetoed
a river and harbor appropriation bill which was specially designed to
distribute funds among localities on the basis of favoritism. In the
same year, he vetoed a Chinese exclusion act as violating the treaty
with China, and made recommendations as to changes which were accepted
by Congress. Arthur also advocated legislation against the spoils
system, and on January 16, 1883, signed the Civil Service law.[24] He
recommended a revision of the tariff, including some striking reductions
in schedules, but the tariff act of 1883 was even less satisfactory to
the public than such measures usually are. Judging by past standards,
however, Arthur had a claim upon his party for the nomination in 1884.

       *       *       *       *       *

But Arthur was not a magnetic leader, and the election of Grover
Cleveland as governor of New York in 1882 and Democratic victories
elsewhere warned the Republicans that their tenure of power was not
indefinite. Circumspection, however, was difficult. A "reform" faction
had grown up within the party, protesting against the gross practices of
old leaders like Conkling and urging at least more outward signs of
propriety. In this faction were Senator Hoar of Massachusetts, George
William Curtis, Henry Cabot Lodge, and Theodore Roosevelt--the last of
whom had just begun his political career with his election to the New
York legislature in 1881. Senator Edmunds, of Vermont, was the leader of
this group, and his nomination was warmly urged in the Republican
convention at Chicago in 1884.

The hopes of the Republican reformers were completely dashed, however,
by the nomination of Blaine. This "gentleman from Maine" was a man of
brilliant parts and the idol of large sections of the country,
particularly the Middle West; but some suspicions concerning his
personal integrity were widely entertained, and not without reason, by a
group of influential leaders in his party. In 1876, he was charged with
having shared in the corruption funds of the Union Pacific Railroad
Company, and as Professor Dunning cautiously puts it, "the facts
developed put Mr. Blaine under grave suspicion of just that sort of
wealth-getting, if nothing worse, which had ruined his colleagues in the
Credit Mobilier." Moreover, Mr. Blaine's associations had been with that
wing of his party which had been involved or implicated in one scandal
after another. Partly on this account, he had been defeated for
nomination in 1876, when he was decidedly the leading aspirant and again
in 1880 when he received 285 votes in the convention. But in 1884,
leaders like Senator Platt, of New York, declared "it is now Blaine's
turn," and he was nominated in spite of a threatened bolt.

The Democrats were fortunate in their selection of Grover Cleveland as
their standard bearer. He had been mayor of Buffalo and governor of New
York, but he had taken no part in national politics and had the virtue
of having few enemies in that field. He was not a man of any large
comprehension of the economic problems of his age, but he was in every
way acceptable to financiers in New York, for he had showed his
indifference to popular demands by vetoing a five-cent fare bill for the
New York City elevated roads which were then being watered and
manipulated by astute speculators, like Jay Gould. Moreover, Mr.
Cleveland possessed certain qualities of straightforwardness and homely
honesty which commended him to a nation wearied of scandalous
revelations and the malodorous spoils system.

These qualities drew to Cleveland the support of a group of eminent
Republicans, like Carl Schurz who had been Secretary of the Interior
under Hayes, George William Curtis, the civil service reformer, Henry
Ward Beecher, and William Everett, who were nicknamed "Mugwumps" from an
Indian word meaning "chief." Although the "reformers" talked a great
deal about "purity" in politics, the campaign of 1884 was principally
over personalities; and, as a contemporary newspaper put it, it took on
the tone of "a pothouse quarrel." There was no real division over
issues, as will be seen by a comparison of platforms, and scandalous
rumors respecting the morals of the two candidates were freely employed
as campaign arguments. Indeed, the spirit of the fray is reflected in
the words of the Democratic platform: "The Republican party, so far as
principle is concerned, is a reminiscence. In practice, it is an
organization for enriching those who control its machinery. The frauds
and jobbery which have been brought to light in every department of the
government are sufficient to have called for reform within the
Republican party; yet those in authority, made reckless by the long
possession of power, have succumbed to its corrupting influence and have
placed in nomination a ticket against which the independent portion of
the party are in open revolt. Therefore a change is demanded." Having
enjoyed no opportunities for corruption worthy of mention, except in New
York City where they had reaped a good harvest during the sunshine, the
Democrats could honestly pose as the party of "purity in politics."

Their demand for a change was approved by the voters, for Cleveland
received 219 electoral votes as against 182 cast for Blaine. A closer
analysis of the vote, however, shows no landslide to the Democrats, for
had New York been shifted to the Republican column, the result would
have been 218 for Blaine and 183 for Cleveland. And the Democratic
victory in New York was so close that a second count was necessary, upon
which it was discovered that the successful candidate had only about
eleven hundred votes more than the vanquished Blaine. Taking the country
as a whole, the Democrats had a plurality of a little more than twenty
thousand votes.

Cleveland's administration was beset by troubles from the beginning. The
civil service reformers were early disappointed with his performances,
as they might have expected. It is true that the Democratic party had
posed in general as the party of "reform," because forsooth having no
patronage to dispense nor favors to grant it could readily make a
virtue of necessity; but it is fair to say that the party had in fact
been somewhat noncommittal on civil service reform, and Cleveland,
though friendly, was hardly to be classed as ardent. The test came soon
after his inauguration. More than one hundred thousand Federal offices
were in the hands of Republicans; the Senate which had to pass upon the
President's chief nominations was Republican and the clash between the
two authorities was spectacular. The pressure of Democrats for office
was naturally strong, and although the civil service reformers got a few
crumbs of comfort, the bald fact stood forth that within two years only
about one third of the former officeholders remained. "Of the chief
officers," says Professor Dewey, "including the fourth class
post-masters, collectors, land officers, numbering about 58,000, over
45,000 were changed. All of the 85 internal revenue collectors were
displaced; and of the 111 collectors of customs, 100 were removed or not
reappointed."

Cleveland's executive policy was negative rather than positive. He
vigorously applied the veto to private pension bills. From the
foundation of the government until 1897, it appears that 265 such bills
were denied executive approval; and of these five were vetoed by Grant
and 260 by Cleveland--nearly all of the latter's negatives being in his
first administration. Cleveland also vetoed a general dependent pension
bill in 1887 on the ground that it was badly drawn and ill considered.
Although his enemies attempted to show that he was hostile to the old
soldiers, his vetoes were in fact based rather upon a careful
examination of the merits of the several acts which showed extraordinary
carelessness, collusion, and fraud. At all events, the Grand Army
Encampment in 1887 refused to pass a resolution of censure. Cleveland
also killed the river and harbor bill of 1887 by a pocket veto, and he
put his negative on a measure, passed the following year, returning to
the treasuries of the northern states nearly all of the direct taxes
which they had paid during the Civil War in support of the Federal
government.

On the constructive side, Cleveland's first administration was marked by
a vigorous land policy under which upwards of 80,000,000 acres of land
were recovered from private corporations and persons who had secured
their holdings illegally. He was also the first President to treat the
labor problem in a special message (1886); and he thus gave official
recognition to a new force in politics, although the sole outcome of his
recommendations was the futile law of 1888 providing for the voluntary
arbitration of disputes between railways and their employees. The really
noteworthy measure of his first administration was the interstate
commerce law of 1887, but that could hardly be called a partisan
achievement.[25]

       *       *       *       *       *

Holding his place by no overwhelming mandate and having none of those
qualities of brilliant leadership which arouse the multitude, Cleveland
was unable to intrench his party, and he was forced to surrender his
office at the end of four years' tenure, although his party showed its
confidence by renominating him in 1888. He had a Democratic House during
his administration, but he was embarrassed by party divisions there and
by a Republican Senate. Under such circumstances, he was able to do
little that was striking, and in his message of December, 1887, he
determined to set an issue by a vigorous attack on the tariff--a subject
which had been treated in a gingerly fashion by both parties since the
War. While he disclaimed adherence to the academic theory of free trade
as a principle, his language was readily turned by his enemies into an
attack on the principle of the protective tariff. Although the
performance of the Democrats in the passage of the Mills tariff bill by
the House in 1888 showed in fact no strong leanings toward free trade,
the Republicans were able to force a campaign on the "American doctrine
of protection for labor against the pauper millions of Europe."

On this issue they carried the election of 1888. Passing by Blaine once
more, the Republicans selected Benjamin Harrison, of Indiana, a United
States Senator, a shrewd lawyer, and a reticent politician. Mr.
Wanamaker, a rich Philadelphia merchant, was chosen to raise campaign
funds, and he successfully discharged the functions of his office. As he
said himself, he addressed the business men of the country in the
following language: "How much would you pay for insurance upon your
business? If you were confronted by from one to three years of general
depression by a change in our revenue and protective measures affecting
our manufactures, wages, and good times, what would you pay to be
insured for a better year?" The appeal was effective and with a full
campaign chest and the astute Matthew S. Quay as director of the
national committee, the Republicans outwitted the Democrats, winning 233
electors' votes against 168 for Cleveland, although the popular vote for
Harrison was slightly under that for his opponent.

Harrison's administration opened auspiciously in many ways. The
appointment of Blaine as Secretary of State was a diplomatic move, for
undoubtedly Blaine was far more popular with the rank and file of his
party than was Harrison. The civil service reformers were placated by
the appointment of Theodore Roosevelt as president of the Civil Service
Commission, for he was a vigorous champion of reform, who brought the
whole question forcibly before the country by his speeches and articles,
although it must be said that no very startling gains were made against
the spoils system under his administration of the civil service law. It
required time to educate the country to the point of supporting the
administrative heads in resisting the clamor of the politicians for
office.

Harrison's leadership in legislation was not noteworthy. The Republicans
were in power in the lower house in 1889 for the first time since 1881,
but their majority was so small that it required all of the
parliamentary ingenuity which Speaker Reed could command to keep the
legislative machine in operation. Nevertheless, several important
measures were enacted into law. The McKinley tariff act based upon the
doctrine of high protection was passed in 1890. In response to the
popular outcry against the trusts, the Sherman anti-trust law was
enacted the same year; and the silver party was thrown a sop in the form
of the Sherman silver purchase act. The veterans of the Civil War
received new recognition in the law of 1890 granting pensions for all
disabled soldiers whether their disabilities were incurred in service or
not. Negro voters were taken into account by an attempt to get a new
"force bill" through Congress, which would insure a "free ballot and a
fair count everywhere."

       *       *       *       *       *

There had been nothing decisive, however, about the Republican victory
in 1888, for a few thousand votes in New York changed the day as four
years before. Harrison had not proved to be a very popular candidate,
and there was nothing particularly brilliant or striking about his
administration to enhance his reputation. He was able to secure a
renomination in 1892, largely because he controlled so many
officeholding delegates to the Republican convention, and there was no
other weighty candidate in the field, Blaine being unwilling to make an
open fight at the primaries.

In the second contest with Cleveland, Harrison was badly worsted,
receiving only 145 electoral votes against 277 cast for the Democratic
candidate and 22 for the Populist, Weaver. The campaign was marked by no
special incidents, for both Cleveland and Harrison had been found safe
and conservative and there was no very sharp division over issues. The
tariff, it is true, was vigorously discussed, but Cleveland made it
clear that no general assault would be made on any protected interests.
The million votes cast for the Populist candidate, however, was a solemn
warning that the old game of party see-saw over personalities could not
go on indefinitely. The issues springing from the great economic
revolution were emerging, not clearly and sharply, but rather in a vague
unrest and discontent with the old parties and their methods.

President Cleveland went into power for the second time on what appeared
to be a wave of business prosperity, but those who looked beneath the
surface knew that serious financial and industrial difficulties were
pending. Federal revenues were declining and a deficit was staring the
government in the face at a time when there was, for several reasons, a
stringency in the gold market. The Treasury gold reserve was already
rapidly diminishing, and Harrison was on the point of selling bonds when
the inauguration of Cleveland saved the day for him. Congress was
deadlocked on the money question, though called in a special session to
grant relief; and Cleveland at length resorted to the sale of bonds
under an act of 1875 to procure gold for the Treasury. The first sale
was made in January, 1894, and the financiers, to pay for the bonds,
drew nearly half of the amount of gold out of the Treasury itself.

The "endless chain" system of selling bonds to get gold for the
Treasury, only to have it drawn out immediately, aroused a great hue and
cry against the financial interests. In November, 1894, a second sale
was made with similar results, and in February, 1895, Cleveland in sheer
desperation called in Mr. J. P. Morgan and arranged for the purchase of
gold at a fixed price by the issue of bonds, with an understanding that
the bankers would do their best to protect the Treasury. To the silver
advocates and the Populists this was the climax of "Cleveland's
iniquitous career of subserviency to Wall Street," for it seemed to show
that the government was powerless before the demands of the financiers.
This criticism forced the administration to throw open the issue of
January 6, 1896, to the public, and the result was decidedly
advantageous to the government--apparently an indictment of Cleveland's
policy. Congress in the meantime did nothing to relieve the
administration.

While the government was wrestling with the financial problem, the
country was in the midst of an industrial crisis. The number of
bankruptcies rose with startling rapidity, hundreds of factories were
closed, and idle men thronged the streets hunting for work. According to
a high authority, Professor D. R. Dewey, "never before had the evil of
unemployment been so widespread in the United States." It was so
pressing that Jacob Coxey, a business man from Ohio, planned a march of
idle men on Washington in 1894 to demand relief at the hands of the
government. His "army," as it was called, ended in a fiasco, but it
directed the attention of the country to a grave condition of affairs.

Reductions in wages produced severe strikes, one of which--the Pullman
strike of Chicago--led to the paralysis of the railways entering
Chicago, because the Pullman employees were supported by the American
Railway Union. The disorders connected with the strike--which are now
known to have been partially fomented by the companies themselves for
the purpose of inducing Federal interference--led President Cleveland to
dispatch troops to Chicago, against the ardent protest of Governor
Altgeld, who declared that the state of Illinois was able to manage her
own affairs without intermeddling from Washington. The president of the
union, Mr. E. V. Debs, was thrown into prison for violating a "blanket
injunction"[26] issued by the local Federal court, and thus the strike
was broken, leaving behind it a legacy of bitterness which has not yet
disappeared.

The most important piece of legislation during Cleveland's second
administration was the Wilson tariff bill--a measure which was so
objectionable to the President that he could not sign it, and it
therefore became law without his approval. The only popular feature in
it was the income tax provision, which was annulled the following year
by the Supreme Court. Having broken with his party on the money
question, and having failed to secure a revision of the tariff to suit
his ideas, Cleveland retired in 1897, and one of his party members
declared that he was "the most cordially hated Democrat in the country."


_Party Issues_

The tariff was one of the issues bequeathed to the parties from
ante-bellum days, but there was no very sharply defined battle over it
until the campaign of 1888. The Republicans, in their platform of 1860,
had declared that "sound policy requires such an adjustment of these
imposts as to encourage the development of the industrial interests of
the whole country"; and although from time to time they advocated tariff
reductions, they remained consistently a protectionist party. The high
war-tariffs, however, were revenue measures, although the protection
feature was by no means lost sight of. In the campaign of 1864, both
parties were silent on the question; four years later it again emerged
in the Democratic platform, but it was not hotly debated in the ensuing
contest. The Democrats demanded "a tariff for revenue upon foreign
imports and such equal taxation under the internal revenue laws as will
afford incidental protection to domestic manufactures."

From that campaign forward the Democrats appeared to favor a "revenue
tariff" in their platforms. It is true they accepted the Liberal
Republican platform in 1872, which frankly begged the question by
acknowledging the wide differences of opinion on the subject and
remitted the discussion of the matter "to the people in their
congressional districts and the decision of Congress thereon." But in
1876, the Democrats came back to the old doctrine and demanded "that all
custom-house taxation shall be only for revenue." In their victorious
campaign of 1884, however, they were vague. They pledged themselves "to
revise the tariff in a spirit of fairness to all interests"; but they
promised, in making reductions, not "to injure any domestic industries,
but rather to promote their healthy growth," and to be mindful of
capital and labor at every step. Subject to these "limitations" they
favored confining taxation to public purposes only. It was small wonder
that Democratic orators during the campaign could promise "no
disturbance of business in case of victory."

Cleveland, in the beginning of his administration, faithfully followed
his platform, for in his first message he "placed the need of tax
reduction solely on the ground of excess revenue and declared that there
was no occasion for a discussion of the wisdom or expediency of the
protective system." But within two years he had seen a new light, and he
devoted his message of December, 1887, exclusively to a discussion of
the tariff issue, in vague and uncertain language it is true, but still
characterized by such a ringing denunciation of the "vicious, illegal,
and inequitable" system of taxation then in vogue, that the Republicans
were able to call it, with some show of justification, a "free trade
document." The New York _Tribune_ announced with evident glee that
Cleveland had made "the issue boldly and distinctly and that the
theories and aims of the ultra-opponents of protection have a new and
zealous advocate." Of course, Cleveland hotly denied that he was trying
to commit his party to a simple doctrine of free trade or even the old
principle of the platform, "tariff for revenue only." Moreover, the
Democrats, in their platform of the following year, while indorsing
Cleveland's messages, renewed the tariff pledges of their last platform
and promised to take "labor" into a careful consideration in any
revision.

In spite of the equivocal position taken by the Democrats, the
Republicans made great political capital out of the affair, apparently
on the warranted assumption that the voters would not read Cleveland's
message or the platform of his party. In their declaration of principles
in 1888, the Republicans made the tariff the leading issue: "We are
uncompromisingly in favor of the American system of protection. We
protest against its destruction, as proposed by the President and his
party. They serve the interests of Europe; we will support the interest
of America. We accept the issue and confidently appeal to the people for
their judgment. The protective system must be maintained.... We favor
the entire repeal of internal taxes rather than the surrender of any
part of our protective system, at the joint behest of the whisky trusts
and the agents of foreign manufacturers." Again, in 1892, the
Republicans attempted to make the tariff the issue: "We reaffirm the
American doctrine of protection. We call attention to its growth abroad.
We maintain that the prosperous condition of our country is largely due
to the wise revenue legislation of the Republican Congress," _i.e._ the
McKinley bill.

The effect of this Republican hammering on the subject was to bring out
a solemn declaration on the part of the Democrats. "We denounce," they
say in 1892, "the Republican protection as a fraud, a robbery of the
great majority of the American people for the benefit of the few. We
declare it to be a fundamental principle of the Democratic party that
the Federal government has no constitutional power to impose and collect
tariff duties, except for the purposes of revenue only, and we demand
that the collection of such taxes shall be limited to the necessities of
the government when honestly and economically administered." Although
elected on this platform, the Democrats did not regard their mandate as
warranting a serious attack on the protective system, for the Wilson
tariff act of 1894 was so disappointing to moderate tariff reformers
that Cleveland refused to sign it.

A close analysis of the platforms and performances of the parties from
1876 to 1896 shows no clear alignment at all on the tariff. Both parties
promise reductions, but neither is specific as to details. The
Republicans, while making much of the protective system, could not
ignore the demand for tariff reform; and the Democrats, while repeating
the well-worn phrases about tariff for revenue, were unable to overlook
the fact that a drastic assault upon the protective interests would mean
their undoing. In Congress, the Republicans made no serious efforts to
lower the duties, and the attempts of the Democrats produced meager
results.

       *       *       *       *       *

Among the new issues raised by the economic revolution was the control
of giant combinations of capital. Although some of the minor parties had
declaimed against trusts as early as 1876, and the Democratic party, in
1884, had denounced "land monopolies," industrial combinations did not
figure as distinct issues in the platforms of the old parties until
1888. In that year, the Democrats vaguely referred to unnecessary
taxation as a source of trusts and combinations, which, "while unduly
enriching the few that combine, rob the body of our citizens by
depriving them of the benefits of natural competition." Here appears the
favorite party slogan that "the tariff is the mother of the trusts," and
the intimation that the remedy is the restoration of "natural
competition" by a reduction of the tariff. The Republicans in 1888 also
recognized the existence of the trust problem by declaring against all
combinations designed to control trade arbitrarily, and recommended to
Congress and the states legislation within their jurisdictions to
"prevent the execution of all schemes to oppress the people by undue
charges on their supplies or by unjust rates for the transportation of
their products to market."

Both old parties returned to the trust question again in 1892. The
Democrats recognized "in the trusts and combinations which are designed
to enable capital to secure more than its just share of the joint
product of capital and labor, a natural consequence of the prohibitive
taxes which prevent the free competition which is the life of honest
trade, but we believe the worst evils can be abated by law." Thereupon
follows a demand for additional legislation restraining and controlling
trusts. The Republicans simply reaffirmed their declaration of 1888,
indorsed the Sherman anti-trust law already enacted by Congress in 1890,
and favored new legislation remedying defects and rendering the
enforcement of the law more complete.

The railway issue emerged in 1880 when the Republicans, boasting that
under their administration railways had increased "from thirty-two
thousand miles in 1860 to eighty-two thousand miles in 1879," pronounced
against any further grants of public domain to railway corporations. The
Democrats went on record against discriminations in favor of
transportation lines, but left the subject with that pronouncement. Four
years later the subject had taken on more precision. The Republicans
favored the public regulation of railway corporations and indorsed
legislation preventing unjust discriminations and excessive charges for
transportation, but in the campaign of 1888 the overshadowing tariff
issue enabled them to omit references to railway regulation. The
Democrats likewise ignored the subject in 1884 and 1888. In 1892 the
question was overlooked by the platforms of both parties, although the
minor parties were loudly demanding action on the part of the Federal
Government. The old parties agreed, however, on the necessity of
legislation protecting the life and limb of employees engaged in
interstate transportation.

       *       *       *       *       *

Even before the Civil War, the labor vote had become a factor that could
not be ignored, and both old parties consistently conciliated it by many
references. The Republicans in 1860 commended that "policy of national
exchanges which secures to the workingmen liberal wages." The defense of
the protective system was gradually shifted by the Republicans, until,
judging from the platforms, its continuation was justifiable principally
on account of their anxiety to safeguard the American workingman against
"the pauper labor of Europe." The Democrats could not overlook the
force of this appeal, and in their repeated demands for the reduction of
the tariff they announced that no devotion to free trade principles
would allow them to pass legislation which might put American labor "in
competition with the underpaid millions of the Old World." In 1880, the
Democratic party openly professed itself the friend of labor and the
laboring man and pledged itself to "protect him against the cormorant
and the commune." In their platform of 1888, the Democrats promised to
make "due allowance for the difference between the wages of American and
foreign labor" in their tariff revisions; and in 1892 they deplored the
fact that under the McKinley tariff there had been ten reductions in the
wages of the workingmen to one increase. In the latter year, the
Republicans urged that on articles competing with American products the
duties should "equal the difference between wages abroad and at home."

Among the more concrete offerings to labor were the promises of
homesteads in the West by the Republicans--promises which the Democrats
reiterated; protection against Chinese and coolie labor, particularly in
the West, safety-appliance laws applicable to interstate carriers, the
establishment of a labor bureau at Washington, the prohibition of the
importation of alien laborers under contract, and the abolition of
prison contract labor. On these matters there was no marked division
between the two old parties; each advocated measures of its own in
general terms and denounced the propositions of the other in equally
general terms.

The money question bulked large in the platforms, but until 1896 there
was nothing like a clean-cut division.[27] Both parties hedged and
remained consistently vague. The Republicans in 1888 declared in favor
of "the use of both gold and silver as money," and condemned "the policy
of the Democratic administration in its efforts to demonetize silver."
Again, in 1892, the Republicans declared: "The American people, from
tradition and interest, favor bimetallism, and the Republican party
demands the use of both gold and silver as standard money, with such
restriction and under such provisions, to be determined by legislation,
as will secure the maintenance of the parity of values of the two
metals, so that the purchasing and debt-paying power of the dollar,
whether of silver, gold, or paper, shall be at all times equal." The
Democrats likewise hedged their profession of faith about with
limitations and provisions. They declared in favor of both metals and no
discrimination for mintage; but the unit of coinage of both metals "must
be of equal intrinsic or exchangeable value, or be adjusted through
international agreement or by such safeguards of legislation as shall
insure the maintenance of the parity of the two metals." Thus both of
the platforms of 1892 are paragons of ambiguity.

FOOTNOTES:

     [24] See below, p. 130.

     [25] Below, p. 133. The tenure of office law was repealed in
     1887. The presidential succession act was passed in 1886.

     [26] A judicial order to all and sundry forbidding them to
     interfere with the movement of the trains.

     [27] See below, p. 119.




CHAPTER V

TWO DECADES OF FEDERAL LEGISLATION, 1877-1896


_Financial Questions_

It was inevitable that financial measures should occupy the first place
in the legislative labors of Congress for a long time after the War.
That conflict had left an enormous debt of more than two billion eight
hundred million dollars, and the taxes were not only high, but they
reached nearly every source which was open to the Federal government.
There were outstanding more than four hundred millions of legal tender
treasury notes, "greenbacks," which had seriously depreciated and, on
account of their variability as compared with gold, offered unlimited
opportunities for speculation and jugglery in Wall Street--of which Jay
Gould's attempt to corner the gold market and the precipitation of the
disaster of Black Friday in 1869 were only spectacular incidents.

Three distinct problems confronted the national administration: the
refunding of the national debt at lower rates of interest, the final
determination of the place and basis of the paper money in the currency
system, and the comparative treatment of gold and silver coinage. The
first of these tasks was undertaken by Congress during Grant's
administration, when, by the refunding acts of 1870 and 1871, the
Treasury was empowered to substitute four, four and one-half, and five
per cent bonds for the war issues at the high rates of five, six, and
even seven per cent.

The two remaining problems were by no means so easy of solution, because
they went to the root of the financial system of the country. Most of
the financial interests of the East were anxious to return to a specie
basis for the currency by retiring the legal tender notes or by placing
them on a metallic foundation. The Treasury under President Johnson
began to withdraw the greenbacks from circulation under authority of an
act of Congress passed in 1866; but it soon met the determined
resistance of the paper money party, which looked upon contraction as a
banker's device to appreciate the value of gold and reduce the amount of
money in circulation, thus bringing low prices for labor and
commodities. Within two years Congress peremptorily stopped the
withdrawal of additional Treasury notes.[28]

Shortly after forbidding the further retirement of legal tender notes,
Congress reassured the hard money party by passing, on March 18, 1869,
an act promising, on the faith of the United States, to pay in coin "all
obligations not otherwise redeemable," and to redeem the legal tender
notes in specie "as soon as practicable." A further gain for hard money
was made in 1875 by the passage of the Resumption Act, providing that on
and after January 1, 1879, "the Secretary of the Treasury shall redeem
in coin the United States legal tender notes then outstanding, on their
presentation for redemption at the office of the Assistant Treasurer of
the United States in the City of New York, in sums of not less than
fifty dollars." When the day set for redemption arrived, the Secretary
of the Treasury was prepared with a large hoard of gold, and public
confidence in the government was so high that comparatively little paper
was presented in exchange for specie.

Out of the conflict over the inflation and contraction of the currency
grew the struggle over "free silver" which was not ended until the
campaign of 1900. To understand this controversy we must go back beyond
the Civil War. The Constitution, as drafted in 1787, gives Congress the
power to coin money and regulate the value thereof and forbids the
states to issue bills of credit or make anything but the gold and silver
coin of the United States legal tender in the payment of debts. Nothing
is said in that instrument about the power of Congress to issue paper
money, and it is questionable whether the framers intended to leave the
door open for legal tenders or notes of any kind.

In 1792, the new Federal government began to coin gold and silver at the
ratio of 1 to 15, but it was soon found that at this ratio gold was
undervalued, and consequently little or no gold was brought to the
Treasury to be coined. At length, in 1834, Congress, by law, fixed the
ratio between the two metals approximately at 16 to 1; but this was
found to be an overvaluation of gold or an undervaluation of silver, as
some said, and as a result silver was not brought to the Treasury for
coinage and almost dropped out of the monetary system. Finally, in 1873,
when the silver dollar was already practically out of circulation,
Congress discontinued the coinage of the standard silver dollar
altogether--"demonetized" it--and left gold as the basis of the monetary
system.[29]

It happened about this time that the price of silver began to decline
steadily, until within twenty years it was about half the price it was
in 1870. Some men attributed this fall in the price of silver to the
fact that Germany had demonetized it in 1871, and that about the same
time rich deposits of silver were discovered in the United States.
Others declared that silver had not fallen so much in price, but that
gold, in which it was measured, had risen on account of the fact that
silver had been demonetized and gold given a monopoly of the coinage
market. On this matter Republicans and Democrats were both divided, for
it brought a new set of economic antagonisms into play--the debtor and
the creditor--as opposed to the antagonisms growing out of slavery and
reconstruction.

Some Republicans, like Senator Morrill, of Vermont, firmly believed that
no approach could be made to a genuine bimetallic currency, both metals
freely and equally circulating, without the cooperation of the leading
commercial nations of the world; and they also went so far as to doubt
whether it would be possible even then to adjust the "fickle ratio"
finely enough to prevent supply and demand from driving one or the other
metal out of circulation. Other Republicans, like Blaine, declared that
the Constitution required Congress to make both gold and silver coin the
money of the land, and that the only question was how best to adjust the
ratio. In a speech in the Senate on February 7, 1878, Blaine said: "I
believe then if Germany were to remonetize silver and the kingdoms and
states of the Latin Union were to reopen their mints, silver would at
once resume its former relation with gold.... I believe the struggle now
going on in this country and in other countries for a single gold
standard would, if successful, produce widespread disaster throughout
the commercial world. The destruction of silver as money and
establishment of gold as the sole unit of value must have a ruinous
effect on all forms of property, _except those investments which yield a
fixed return in money_."

It was this exception made by Blaine that formed the crux of the whole
issue. The contest was largely between creditors and debtors. Indeed, it
is thus frankly stated by Senator Jones of Nevada in a speech in the
Senate on May 12, 1890: "Three fourths of the business enterprises of
this country are conducted on borrowed capital. Three fourths of the
homes and farms that stand in the name of the actual occupants have been
bought on time, and a very large proportion of them are mortgaged for
the payment of some part of the purchase money. Under the operation of a
shrinkage in the volume of money, this enormous mass of borrowers, at
the maturity of their respective debts, though nominally paying no more
than the amount borrowed, with interest, are, in reality, in the amount
of the principal alone, returning a percentage of value greater than
they received--more in equity than they contracted to pay, and
oftentimes more in substance than they profited by the loan.... It is a
remarkable circumstance that throughout the entire range of economic
discussion in gold-standard circles, it seems to be taken for granted
that a change in the value of the money unit is a matter of no
significance, and imports no mischief to society, _so long as the change
is in one direction_. Who ever heard from an Eastern journal any
complaint against a contraction of our money volume, any admonition that
in a shrinking volume of money lurk evils of the utmost magnitude?... In
all discussions of the subject the creditors attempt to brush aside the
equities involved by sneering at the debtors." Both parties to the
conflict assumed a monopoly of virtue and economic wisdom, and the
controversy proceeded on that plane, with no concessions except where
necessary to secure some practical gain.

By 1877, silver had fallen to the ratio of seventeen to one as compared
with gold, and silver mine owners were anxious to have the government
buy their bullion at the old rate existing before the "demonetization"
of 1873. In this they were supported by the farmers and the debtor
classes generally, who thought that the gold market was substantially
controlled by a relatively few financiers and that the appreciation of
the yellow metal meant lower prices for their commodities and the
maintenance of high interest rates. Criticism was leveled particularly
against the bondholders, who demanded the payment of interest and
principal in gold, in spite of the fact that, at the time the bonds were
issued, the government had not demonetized silver and could have paid
in silver dollars containing 412-1/2 grains each. In addition to the
holders of the national debt, there were the owners of industrial,
state, and municipal bonds and railway and other securities who likewise
sought payment in a metal that was appreciating in value.

In the Forty-fourth Congress, the silver party, led by Bland, of
Missouri, attempted to force the passage of a law providing for the free
and unlimited coinage of silver approximately at the ratio of sixteen to
one, but their measure was amended on the motion of Allison, of Iowa, in
the Senate, in such a manner as simply to authorize the Secretary of the
Treasury to purchase not less than two million nor more than four
million dollars' worth of silver each month to be coined into silver
dollars. The measure thus amended was vetoed by Hayes, but was repassed
over his protest and became a law in 1878, popularly known as the
Bland-Allison Act. The opponents of contraction were able to secure the
passage of another act in the same year forbidding the further
retirement of legal tender notes and providing that the Treasury,
instead of canceling such notes on receiving them, should reissue them
and keep them in circulation.

None of the disasters prophesied by the gold advocates followed the
enactment of the Bland-Allison bill, but no one was satisfied with it.
The value of silver as compared with gold steadily declined, until the
ratio was twenty-two to one in 1887. The silver party claimed that the
trouble was not with silver, but that the appreciation of gold had been
largely induced by the government's discriminating policy. The gold
party pointed to the millions of silver dollars coined and unissued
filling the mints and storage vaults to bursting, all for the benefit of
the silver mine owners. The retort of the silver party was a law issuing
silver certificates in denominations of one, two, and five dollars, in
1886. This was supplemented four years later by the Sherman silver
purchase act of 1890 (repealed in 1893), which provided for the purchase
of 4,500,000 ounces of silver monthly and the issue of notes on that
basis redeemable in gold or silver at the discretion of the Treasury.
Congress took occasion to declare also that it was the intention of the
United States to maintain the two metals on a parity--a vague phrase
which was widely used by both parties to conciliate all factions.
Neither the Republicans nor the Democrats were as yet ready for a
straight party fight on the silver issue.


_Tariff Legislation_

At the opening of Hayes' administration the Civil War tariff was still
in force. It is true, there had been some slight reduction in 1872, but
this was offset by increases three years later. During the two decades
following, there was much political controversy over protection, as we
have seen, and there were three important revisions of the protective
system: in 1883 on the initiation of the Senate, in 1890 when the
McKinley bill was passed, and in 1894 when the Wilson bill was enacted
under Democratic auspices.

The first of these revisions was induced largely by the growing surplus
in the Federal Treasury and the inability of Congress to dispose of it,
even by the most extravagant appropriations. In 1882, the surplus rose
to the startling figure of $145,000,000, and a tariff commission was
appointed to consider, among other things, some method of cutting down
the revenues by a revision of duties. This commission reported a revised
schedule of rates providing for considerable reductions, but still on a
highly protective basis. The House at that time was Republican, and the
Senate was equally divided, with two independents holding the balance of
power. The upper house took the lead in the revision and escaped the
constitutional provision requiring the initiation of revenue bills in
the lower house by tacking their measure to a bill which the House had
passed at the preceding session.

Under the circumstances neither party was responsible for the measure,
and it is small wonder that it pleased no one, after the fashion of
tariff bills. There was a slight reduction on coarse woolens, cottons,
iron, steel, and several other staple commodities, but not enough to
place the industries concerned on a basis of competition with European
manufactures. New England agricultural products were carefully
protected, but the wool growers of Ohio and other middle western states
lost the ad valorem duties on wool. The Democrats in the House denounced
the measure, and most of them voted against it because, they alleged, it
did not go far enough. William McKinley, of Ohio, then beginning his
career, opposed it on other grounds; and Senator Sherman from the same
state afterward regretted that he had not defeated the bill altogether.
The tariff was "revised but not changed," as a wag put it, and no one
was enthusiastic about the measure.

Almost immediately attempts were made to amend the law of 1883. For two
years the Democrats, under the leadership of W. R. Morrison, chairman of
the Ways and Means Committee, pottered about with the tariff, but
accomplished nothing, partially on account of the opposition of
protectionist Democrats, like Randall, of Pennsylvania. In 1886,
President Cleveland, in his second message, took up the tariff
seriously; and under the leadership of Roger Q. Mills, of Texas, the
Democratic House, two years later, passed the "Mills bill" only to see
it die in the Senate. The Republican victory of 1888, though narrow, was
a warning that no compromise would be made with those who struck a blow
at protection.

The Republican House set to work upon a revision of the tariff with a
view to establishing high protection, and in May, 1890, Mr. McKinley,
chairman of the Ways and Means Committee, introduced his bill increasing
the duties generally. In the preparation of this measure, the great
manufacturing interests had been freely consulted, and their requests
for rates were frequently accepted without change, or made the basis for
negotiations with opposing forces, as in the case, for example, of the
binding twine trust and the objecting farmers. On the insistence of Mr.
Blaine, then Secretary of State, a "reciprocity" clause was introduced
into the bill, authorizing the President to place higher duties on
certain commodities coming from other countries, in case he deemed their
retaliatory tariffs "unreasonable or unjust."

The opposition to the McKinley bill was unusually violent, and no
opportunity was given to test its working before the country swung again
to the Democrats in the autumn of 1890; but the Republican majority in
the Senate prevented the House from carrying through any of its attacks
on the system. The election of Cleveland two years later and the capture
of the Senate as well by the Democrats seemed to promise that the
long-standing threat of a general downward revision would be carried
out. William Wilson, of West Virginia, reported the new bill from the
Ways and Means Committee in December, 1893. Although it made numerous
definite reductions in duties, it was by no means a drastic "free trade"
measure, such as the Republicans had prophesied in their campaign
speeches. The bill passed the House by a large majority, with only a few
Democrats voting against it. Even radical Democrats from the West, who
would have otherwise demanded further reductions, were conciliated by
the provision for a tax on all incomes over $4000.

When the Wilson bill left the House of Representatives, it had some of
the appearances at least of a "tariff-for-revenue" measure. Reductions
had been made all along the line, not without regard, of course, for
sectional interests, in memory of the principle that the "tariff is a
local issue." But the Senate made short work of it. There the individual
member counted for more. He had the right to talk as long as he pleased,
and he could trade his vote on schedules in which he was not personally
interested for votes on his own schedules. Thus by forceful and
ingenious manipulation, the Wilson bill was shorn of its most drastic
features (not without some rejoicing in the House as well as in the
Senate), and it went to President Cleveland in such a form that he
refused to accept it as a tariff reform measure and simply allowed it to
become a law without his signature.

The action of the Democratic Senate is easily accounted for. Hill, of
New York, was almost rabid in his opposition to the income tax
provision. Louisiana was a great sugar-growing state, and her Senators
had their own notion as to what were the proper duties on sugar. Alabama
had rising iron industries, and her Senators shared the emotions of the
representatives from Pennsylvania as the proposed reductions on iron
products were contemplated. Senator Gorman, of Maryland, had no more
heart in "attacking the interests" than did Senator Quay, of
Pennsylvania, who, by the way, used his "inside information" during the
passage of the bill to make money by speculating in sugar stocks.

With glee the Republicans taunted the Democrats that their professions
were one thing and their performances another. "This is not a protective
bill," said Senator O. H. Platt, of Connecticut. "It is not in any sense
a recognition of the doctrine of protection high or low. It is not a
bill for revenue with incidental protection. It is a bill (and the truth
may as well be told in the Senate of the United States) which proceeds
upon free trade principles, except as to such articles as it has been
necessary to levy protective duties upon to get the votes of the
Democratic Senators to pass the bill.... No such marvel has ever been
seen under the sun as all the Democratic Senators, with the possible
exception of the Senator from Texas (Mr. Mills), giving way to this
demand of the sugar trust. How this chamber has rung with the
denunciations of the sugar trust! How the ears of waiting and listening
multitudes in Democratic political meetings have been vexed with
reiterated denunciations of this sugar trust! And here every Democratic
Senator, with one exception, is ready to vote for a prohibitive duty
upon refined sugar."

Twenty years of tariff agitation and tinkering had thus ended in general
dissatisfaction with the promises and performances of both parties. The
Republicans had advanced to a position of high protection based
principally upon the demands of manufacturing interests themselves,
modified by such protests on the part of consumers as became vocal and
effective in politics. The Democrats had been driven, under Mr.
Cleveland's leadership, to what seemed to be a disposition to reduce the
tariff to something approaching a revenue basis, but when it came to an
actual performance, their practical views, as manifested in the
Wilson-Gorman act, were not far behind those of the opposing party.
Representatives of both parties talked as if the issue was a contest
between tariff-for-revenue and protection, but in fact it was not. The
question was really, "which of the several regions shall receive the
most protection?" Of attempts to get the tariff upon a "scientific
basis," striking a balance among all the interests of the country,
there was none. Ten years of political warfare over free silver and
imperialism were to elapse before there could be a renewed examination
of protection as a system.


_The Civil Service Law of 1883_

The "spoils system" of making Federal offices the reward for partisan
services began to draw a strong fire of criticism in Grant's first
administration. It was natural that the Democrats should view with
disfavor a practice which excluded them entirely from serving their
country in an official capacity, and the reformers regarded it as a
menace to American institutions because it was the basis of a "political
machine" which controlled primaries and elections and shut out the
discussion of real issues. In response to this combined attack, Congress
passed in 1871 a law authorizing the President to prescribe regulations
for admission to the civil service and provide methods for ascertaining
the fitness of candidates--a law which promised well while the
distinguished champion of reform, George William Curtis, was head of the
board in charge of its administration. Congress, however, had accepted
the reform reluctantly and refused to give it adequate financial
support. After two years' experience with the law, Curtis resigned, and
within a short time the whole scheme fell to the ground.

The reformers, however, did not give up hope, for they were sufficiently
strong to compel the respect of the Democrats, and the latter, by their
insistence on a reform that cost them nothing, forced the Republicans
to give the merit system some prominence in their campaign promises.
But practical politicians in both parties had small esteem for a plan
that would take away the incentive to work for victory on the part of
their followers. It was scornfully called "snivel service" and
"goody-goody reform"; and the old practices of distributing offices to
henchmen and raising campaign funds by heavy assessments on
officeholders were continued.

Never was the spoils system more odious than when the assassination of
Garfield by a disappointed office hunter startled the country from its
apathy. Within a year, a Senate committee had reported favorably on a
civil service reform bill. It declared that the President had to wear
his life out giving audiences to throngs of beggars who besieged the
executive mansion, and that the spectacle of the chief magistrate of the
nation dispensing patronage to "a hungry, clamorous, crowding, and
jostling multitude" was humiliating to the patriotic citizen. And with
the Congressman the system "is ever present. When he awakes in the
morning it is at his door, and when he retires at night it haunts his
chamber. It goes before him, it follows after him, and it meets him on
the way." The only relief, concluded the report, was to be found in a
thoroughgoing merit system of appointing civil servants.

At length in 1883 Congress passed the civil service act authorizing, but
not commanding, the President to appoint a commission and extend the
merit system to certain Federal offices. The commission was to be
composed of three members, not more than two of the same party,
appointed by the President and Senate, and was charged with the duty of
aiding the President, at his request, in preparing suitable rules for
competitive examinations designed to test the fitness of applicants for
offices in the public service, already classified or to be classified by
executive order or by further legislation. The act itself brought a few
offices under the merit system, but it left the extension of the
principle largely to the discretion of the President. When the law went
into force, it applied only to about 14,000 positions, but it was
steadily extended, particularly by retiring Presidents anxious to secure
the jobs already held by their partisans or to improve the efficiency of
the service. Neither Cleveland nor Harrison enforced the law to the
satisfaction of the reformers, for the pressure of the office seekers,
particularly under Cleveland's first administration, was almost
irresistible.


_Railway and Trust Regulation_

In the beginning of the railway era in the United States, Congress made
no attempt to devise a far-sighted plan of public control, but
negligently devoted its attention to granting generous favors to
railways. It was not until the stock-watering, high-financing,
discriminations and rebates had disgraced the country that Congress was
moved to act. It is true that President Grant in his message of 1872
recommended, and a Senate committee approved, a comprehensive plan for
regulating railways, but there was no practical outcome. The railway
interests were too strong in Congress to permit the enactment of any
drastic regulatory laws. But at length the Granger movement, which had
produced during the seventies so much railway regulation in the
States,[30] appeared in Congress, and stirred by a long report by a
Senate committee enumerating a terrifying list of abuses against
shippers particularly, Congress passed, in 1887, the first important
interstate commerce law.

This act was a timid, halting measure, and the Supreme Court almost
immediately sheared away its effectiveness by decisions in favor of the
railway companies. The law created a commission of five members
empowered to investigate the operations of common carriers and order
those who violated the law to desist. The act itself forbade
discriminations in rates, pooling traffic, and the charging of more for
"short" than "long hauls" over the same line, except under special
circumstances. In spite of the good intentions of the commission, the
law was practically a dead letter. According to a careful scholar,
Professor Davis R. Dewey, "By 1890 the practice of cut rates to favored
shippers and cities was all but universal at the West; passes were
generally issued; rebates were charged up to maintenance of way account;
special privileges of yardage, loading, and cartage were granted;
freight was underbilled or carried under a wrong classification and
secret notification of intended reduction of rates was made to favored
shippers.... The ingenuity of officials in breaking the spirit of the
law knew no limit, and is a discouraging commentary on the dishonesty
which had penetrated into the heart of business enterprise."[31]

The critics of railway policy who were able to force the passage of the
interstate commerce act usually coupled the denunciation of the
industrial monopolies with their attacks on common carriers; and, three
years after the establishment of the interstate commerce commission,
Congress, feeling that some kind of action was demanded by the political
situation, passed the Sherman anti-trust law of 1890. There was no
consensus of opinion among the political leaders as to the significance
of the trust. Blaine declared that "trusts were largely a private affair
with which neither the President nor any private citizen had any
particular right to interfere." Speaker Reed dismissed the subject by
announcing that he had heard "more idiotic raving, more pestiferous
rant, on that subject than on all others put together." Judge Cooley, on
seeing "the utterly heartless manner in which the trusts sometimes have
closed many factories and turned men willing to be industrious into the
streets in order that they may increase profits already reasonably
large," asked whether the trust "as we see it is not a public enemy;
whether it is not teaching the laborer dangerous lessons; whether it is
not helping to breed anarchy."

In the midst of this general confusion of opinion on the trust, it is
not surprising that Congress in the Sherman law of 1890 enunciated no
clear principles. Apparently it intended to restore competition by
declaring illegal "every contract, combination in the form of trust or
otherwise, or conspiracy, in restraint of trade or commerce among the
several states or with foreign nations." But a study of the debates over
the law fails to show any consistent opinion as to what combinations
were included within the prohibition or as to the exact meaning of
"restraint of trade." Of course, the lawyers pointed at once to the
simplicity of the old common law doctrine that conspiracies in restraint
of trade are illegal, but this was an answer in verbiage which gave no
real clew to concrete forms of restraint under the complex conditions of
modern life.

The vagueness of the Sherman anti-trust law was a subject of remark
during its passage through Congress. O. H. Platt, in the Senate,
criticized the bill as attacking all combinations, no matter what their
practices or forms. "I believe," he said, "that every man in business--I
do not care whether he is a farmer, a laborer, a miner, a sailor,
manufacturer, a merchant--has a right, a legal and a moral right, to
obtain a fair profit upon his business and his work; and if he is driven
by fierce competition to a spot where his business is unremunerative, I
believe it is his right to combine for the purpose of raising prices
until they shall be fair and remunerative. This bill makes no
distinction. It says that every combination which has the effect in any
way to advance prices is illegal and void.... The theory of this bill is
that prices must never be advanced by two or more persons, no matter how
ruinously low they may be. That theory I denounce as utterly untenable,
as immoral."

Senator Platt then went on to say that the whole subject had not been
adequately considered and that the bill was a piece of politics, not of
statesmanship. "I am sorry, Mr. President," he continued, "that we have
not had a bill which had been carefully prepared, which had been
thoughtfully prepared, which had been honestly prepared, to meet the
object which we all desire to meet. The conduct of the Senate for the
past three days--and I make no personal allusions--has not been in the
line of the honest preparation of a bill to prohibit and punish trusts.
It has been in the line of getting some bill with that title that we
might go to the country with. The questions of whether the bill would be
operative, of how it would operate, or whether it was within the power
of Congress to enact it, have been whistled down the wind in this Senate
as idle talk, and the whole effort has been to get some bill headed: 'A
Bill to Punish Trusts,' with which to go to the country."

Senator Hoar, who claimed that he was the author of the Sherman
anti-trust law, says, however, that the act was not directed against
_all_ combinations in business. "It was expected," he says, "that the
court in administering that law would confine its operations to cases
which are contrary to the policy of the law, treating the words
'agreements in restraint of trade' as having a technical meaning, such
as they are supposed to have in England. The Supreme Court of the United
States went in this particular farther than was expected.[32] ... It has
not been carried to its full extent since, and I think will never be
held to prohibit those lawful and harmless combinations which have been
permitted in this country and in England without complaint, like
contracts of partnership, which are usually considered harmless."

The immediate effects of the Sherman anti-trust law were wholly
negligible. Seven of the eight judicial decisions under the law during
Harrison's administration were against the government, and no indictment
of offenders against the law went so far as a trial. During Cleveland's
second term the law was a dead letter. Meanwhile trusts and combinations
continued to multiply.


_The Income Tax Law of 1894_

In the debates over tariff reduction, silver, and paper money, evidences
of group and class conflicts were almost constantly apparent, but it was
not until the enactment of the income tax provision of 1894 that
political leaders of national standing frankly avowed a class
purpose--the shifting of a portion of the burden of national taxes from
the commodities consumed by the poor to the incomes of the rich.

The movement for an income tax found its support especially among the
farmers of the West and South and the working classes of the great
cities. The demand for it had been appearing for some time in the
platforms of the agrarian and labor parties. The National or Greenback
party, in its platform of 1884, demanded "a graduated income tax" and "a
wise revision of the tariff laws with a view to raising revenues from
luxury rather than necessity." The Anti-monopoly party, in the same
year, demanded, "a graduated income tax and a tariff, which is a tax
upon the people, that shall be so levied as to bear as lightly as
possible upon necessaries. We denounce the present tariff as being
largely in the interest of monopolies and demand that it be speedily and
radically reformed in the interest of labor instead of capital." The
Union Labor convention at Cincinnati in 1888 declared in its platform:
"A graduated income tax is the most equitable system of taxation,
placing the burden of government upon those who can best afford to pay,
instead of laying it upon the farmers and producers and exempting
millionaire bondholders and corporations."

In the campaign of 1892, the demand for an income tax was made by the
Populist party and by the Socialist Labor party. The former frankly
declared war on the rich, proclaiming in its platform that, "The fruits
of the toil of millions are boldly stolen to build up colossal fortunes
for a few, unprecedented in the history of mankind; and the possessors
of these, in turn, despise the republic and endanger liberty." Among the
remedies for this dire condition of things the Populists demanded "a
graduated income tax." The Democrats, at their convention of that year,
denounced the McKinley tariff law "as the culminating atrocity of class
legislation," and declared that "The Federal government has no
constitutional power to impose and collect tariff duties except for the
purpose of revenue only."

When it was discovered in the ensuing election that the Democratic
party, with its low tariff pronunciamento was victorious, and that the
Populists with their radical platform had carried four western states
and polled more than a million votes, shrewd political observers saw
that some revision in the revenue system of the Federal government was
imperative. President Cleveland, in his message of December, 1893, in
connection with the recommendation for a revision of the tariff, stated
that, "the committee ... have wisely embraced in their plans a few
additional revenue taxes, including a small tax upon incomes derived
from certain corporate investments." It is not clear what committee the
President had in mind, and Senator Hill declared that the Ways and Means
Committee had not agreed "upon any income tax or other internal
taxation"; although it had undoubtedly been considering the subject in
connection with the revision of the tariff.

When the tariff bill was introduced in Congress, on December 19, 1893,
it contained no provision for an income tax, and it was not until
January 29 that an income tax amendment to the Wilson bill was
introduced in behalf of the Committee. In defending his amendment, the
mover, Mr. McMillin, declared that the purpose of the tax was to place a
small per cent of the enormous Federal burden "upon the accumulated
wealth of the country instead of placing all upon the consumption of the
people." He announced that they did not come there in any spirit of
antagonism to wealth, that they did not intend to put an undue embargo
upon wealth, but that they did intend to make accumulated wealth pay
some share of the expenses of the government. The tariff, in his
opinion, taxed want, not wealth. He was impatient with the hue and cry
that was raised, "when it is proposed to shift this burden from those
who cannot bear it to those who can; to divide it between consumption
and wealth; to shift it from the laborer who has nothing but his power
to toil and sweat to the man who has a fortune made or inherited." The
protective tariff, he added, had made colossal fortunes by levying
tribute upon the many for the enrichment of the few; and yet the
advocates of an income tax were told that this accumulated wealth was a
sacred thing which should go untaxed forever. In announcing this
determination to tax the rich, Mr. McMillin disclaimed any intention of
waging a class war, by declaring that the income tax, in his opinion,
would "diminish the antipathy that now exists between the classes," and
sweep away the ground for that "iconoclastic complaint which finds
expression in violence and threatens the very foundations upon which our
whole institution rests."

The champions of property against this proposal to tax incomes in order
to relieve the burden upon consumption summoned every device of oratory
and argument to their aid. They ridiculed and denounced, and endeavored
to conjure up before Congress horrible visions of want, anarchy,
socialism, ruin, and destruction. J. H. Walker, of Massachusetts,
declared that, "The income tax takes from the wealth of the thrifty and
the enterprising and gives to the shifty and the sluggard." Adams, of
Pennsylvania, found the income tax "utterly distasteful in its moral and
political aspects, a piece of class legislation, a tax upon the thrifty,
and a reward to dishonesty." In the Senate, where there is supposed to
be more sobriety, the execrations heaped upon the income tax proposal
were marked by even more virulence. Senator Hill declared that, "The
professors with their books, the socialists with their schemes, the
anarchists with their bombs, are instructing the people of the United
States in the organization of society, the doctrines of democracy, and
the principles of taxation. No wonder if their preaching can find ears
in the White House." In his opinion, also, the income tax was an
"insidious and deadly assault upon state rights, state powers, and state
independence." Senator Sherman particularly objected to the high
exemption, declaring, "In a republic like ours, where all men are equal,
this attempt to array the rich against the poor, or the poor against the
rich, is socialism, communism, devilism."

In spite of this vigorous opposition, the House passed the provision by
a vote of 204 to 140 and the Senate by a vote of 39 to 34. In its final
form the law imposed a tax of two per cent on all incomes above
$4000--an exemption under which the farmer and the lower middle class
escaped almost entirely. Cleveland did not like a general income tax,
and he was dissatisfied with the Wilson tariff bill to which the tax
measure was attached. He, therefore, allowed it to go into effect
without his signature.


_Labor Legislation_

The only measures directly in the interests of labor generally passed
during this period were the Chinese exclusion act, the law creating a
labor bureau at Washington, and the prohibition of the importation of
alien workingmen under contract. Shortly after the Civil War, protests
were heard against cheap Chinese labor, not only in the western states,
but also in the East, where manufacturers were beginning to employ
coolies to break strikes and crush unions. At length, early in 1882,
Congress passed a measure excluding Chinese laborers for a period of
twenty years, the Republicans from the eastern districts voting
generally against it. President Arthur vetoed the bill, holding in
particular that it was a violation of treaty provisions with China, and
suggested a limitation of the application of the principle to ten years.
This was accepted by Congress, and the law went into force in August of
that year. More stringent identification methods were later applied to
returning Chinese, and in 1892, the application of the principle of
exclusion was further extended for a term of ten years. In 1884, a
Federal bureau of labor statistics was created to collect information
upon problems of labor and capital. In 1885, Congress passed a law
prohibiting the importation of laborers under contract, which was
supplemented by later legislation.[33]

FOOTNOTES:

     [28] See below, p. 123.

     [29] The Silver Democrats declared that this demonetization
     was secretly brought about by a "conspiracy" on the part of
     gold advocates, and named the act in question "the crime of
     '73."

     [30] See above, p. 167.

     [31] _National Problems_, p. 103.

     [32] See below, p. 332.

     [33] In 1887, Congress enacted a law providing for counting
     the electoral vote in presidential elections. This measure
     grew out of the disputed election of 1876.




CHAPTER VI

THE GROWTH OF DISSENT


Important as was the legislation described in the preceding chapter,
there were sources of discontent which it could not, in the nature of
things, dry up. With the exception of the income tax, there had been no
decisive effort to placate the poorer sections of the population by
distinct class legislation. It is true, the alien contract labor law and
the Chinese exclusion act were directed particularly to the working
class, but their effects were not widely felt.

The accumulation of vast fortunes, many of which were gained either by
fraudulent manipulations, or shady transactions within the limits of the
law but condemned by elementary morals, and the massing of millions of
the proletariat in the great industrial cities were bound in the long
run to bring forth political cleavages as deep as the corresponding
social cleavage. The domination of the Federal government by the
captains of machinery and capital was destined to draw out a counter
movement on the part of the small farmers, the middle class, and the
laborers. Mutterings of this protest were heard in the seventies; it
broke forth in the Populist and Socialist movement in the nineties; it
was voiced in the Democratic campaign of 1896; silenced awhile by a
wave of imperialism, it began to work a transformation in all parties at
the opening of the new century.

       *       *       *       *       *

This protest found its political expression in the organization of
"third" or minor parties. The oldest and most persistent of all these
groups is the Prohibitionist party, which held its first national
convention at Columbus, Ohio, in 1872, and nominated Mr. Black, of
Pennsylvania, as its candidate. In its platform, it declared the
suppression of the liquor traffic to be the leading issue, but it also
proposed certain currency reforms and the regulation of transportation
companies and monopolies.

Although their popular vote in 1872 was less than six thousand, the
Prohibitionists returned to their issue at each succeeding campaign with
Spartan firmness, but their gains were painfully slow. They reached 9522
in 1876, and 10,305 in 1880. In the campaign of 1884, when many
Republicans were dissatisfied with the nomination of Blaine, and
unwilling to follow Curtis and Schurz into the Democratic camp, the
Prohibition vote rose to 150,369. A further gain of nearly one hundred
thousand votes in the next election, to which a slight addition was made
in 1892, encouraged the Prohibitionists to hope that the longed-for
"split" had come, and they frightened the Republican politicians into
considering concessions, especially in the states where the temperance
party held the balance of power. In fact, in their platform of 1892 the
Republicans announced in a noncommittal fashion that they sympathized
with "all wise and legitimate efforts to lessen and prevent the evils of
intemperance and promote morality." The scare was unwarranted, however,
for the Prohibition party had about reached its high-water mark. Being
founded principally on one moral issue and making no appeal to any
fundamental economic divisions, it could not make headway against the
more significant social issues, and its strength was further reduced by
the growth of state and local prohibition.

       *       *       *       *       *

Almost immediately after the Civil War, labor entered politics in a
small way on its own account. In 1872, a party known as the "Labor
Reformers" held a national convention at Columbus which was attended by
delegates from seventeen states. It declared in favor of restricting the
sale of public lands to homesteaders, Chinese exclusion, an eight-hour
day in government employments, civil service reform, one term for each
President, regulation of railway and telegraph rates, and the subjection
of the military to the civil authorities. The party nominated Justice
Davis, who had been appointed to the Supreme Court of the United States
by Lincoln and had shown Populist leanings immediately after the War;
but Mr. Davis declined to serve, and O'Connor of New York, to whom the
place was then tendered, only polled about 29,000 votes.

This early labor party was simply a party of mild protest. It originated
in Massachusetts, where there had been a number of serious labor
disputes and a certain shoe manufacturer had imported a carload of
Chinese to operate his machinery. Although Wendell Phillips, who had
declared the emancipation of labor to be the next great issue after the
emancipation of slaves, was prominently identified with it and stood
next to Justice Davis on the first poll in the convention, the party as
a whole manifested no tendency to open a distinct class struggle, and
the leading planks of its program were shortly accepted by both of the
old parties.

Standing upon such a temporary platform, and unsupported by any general
philosophy of politics, the labor reform party inevitably went to
pieces. Its dissolution was facilitated by the rise of an agrarian
party, the Greenbackers, who, in their platform of 1880, were more
specific and even more extensive in their declaration of labor's rights
than the "Reformers" themselves had been. It was not until 1888 that
another "labor" group appeared, but since that date there has been one
or more parties making a distinct appeal to the working class. In that
year, there were two "labor" factions, the Union Labor party and the
United Labor party. Both groups came out for the public ownership of the
means of transportation and communication and a code of enlightened
labor legislation. The former advocated the limitation of land ownership
and the latter the application of the single tax. Both agreed in
denouncing the "Democratic and Republican parties as hopelessly and
shamelessly corrupt, and, by reason of their affiliation with
monopolies, equally unworthy of the suffrages of those who do not live
upon public plunder." The vote of both groups in the ensuing election
was slightly over 150,000.

The labor groups which had broken with the old parties took a more
definite step toward socialism in 1892, when they frankly assumed the
name of the Socialist Labor party[34] and put forward a declaration in
favor of the public ownership of utilities and a general system of
protective labor legislation. Although the socialism of Karl Marx had by
this time won a wide influence among the working classes of Europe,
there are few if any traces of it in the Socialist Labor platform of
1892. That platform says nothing about the inevitable contest between
labor and capitalism, or about the complete public ownership of all the
means of transportation and production. On the contrary, it confines its
statements to concrete propositions, including the political reforms of
the initiative, referendum, and recall, all of which have since been
advocated by leaders in the old parties. The small vote received in 1892
by the socialistic candidate, 21,532, is no evidence of the strength of
the labor protest, for the Populist party in that year included in its
program substantially the same principles and made a distinct appeal to
the working class, as well as to the farmers.

       *       *       *       *       *

Indeed, the discontent of the two decades from 1876 to 1896 was confined
principally to the small farmers, who waged, in fact, a class war upon
capitalists and financiers, although they nowhere formulated it into a
philosophy. They chose to rely upon the inflation of the currency as
their chief weapon of offense. A precursor to the agrarian movement in
politics is to be found in the "Granger Movement," which began with the
formation of an association known as the "Patrons of Husbandry" in
1867. This society, which organized local lodges on a secret basis and
admitted both men and women, was originally designed to promote
agricultural interests in a general and social way, and its political
implications were not at first apparent. It naturally appealed, however,
to the most active and socially minded farmers, and its leaders soon
became involved in politics.

The sources of agrarian discontent were obvious. During the War, prices
had been high and thousands of farm "hands" and mechanics had become
land owners, thanks to the homestead laws enacted by the Republican
party; but they had little capital to start with, and their property was
heavily mortgaged. When the inflated War prices collapsed, they found
themselves compelled to pay interest at the old rate, and they figured
it out that capitalists and bondholders were the chief beneficiaries of
the Federal financial legislation. In spite of all that had been paid on
the national and private debts, the amount still due, they reckoned,
measured in the products of toil, wheat and corn, was greater than ever.
They, therefore, hit on the conclusion that the chief source of trouble
was in the contraction of the currency which reduced the money value of
their products. The remedy obviously was inflation in some form.[35]

While the currency thus became the chief agrarian issue, the farmers
attributed a part of their troubles to the railway companies whose
heavily "watered" capital made high freight rates necessary, and whose
discriminations in charges fell as heavy burdens on shippers outside of
the zones of competition. The agrarians, therefore, resorted to railway
legislation in their respective states--the regulation of rates and
charges for transportation and the conditions under which grain should
be warehoused and handled. In Illinois, Iowa, Wisconsin, and other
states, the law makers yielded to the pressure of the farmers for this
kind of legislative relief, and based their legal contentions on the
ground that the railways "partook of the nature of public highways." The
Grangers were strengthened in their convictions by the violence of the
opposition offered on the part of the railways to the establishment of
rates and charges by public authority, and by their constant appeals to
the courts for relief.[36]

Of course, the fixing of flat rates without any inquiry into the cost of
specific services was open to grave objections; but the opposition of
the companies was generally based on the contention that they had a
right to run their business in their own way. The spirit of this
opposition is reflected in an editorial published in the _Nation_, of
New York, in January, 1875: "We maintain that the principle of such
legislation is either confiscation, or, if another phrase be more
agreeable, the change of railroads from pieces of private property,
owned and managed for the benefit of those who have invested their money
in them, into eleemosynary or charitable corporations, managed for the
benefit of a particular class of applicants for outdoor relief--the
farmers. If, in the era of progress to which the farmers' movement
proposes to introduce us, we are going back to a condition of society in
which the only sort of property which we can call our own is that which
we can make our own by physical possession, it is certainly important to
every one to know it, and the only body which can really tell us is the
Supreme Court at Washington."

Not content with their achievements in the state legislatures, the
agrarians entered national politics in 1876 in the form of the
Independent National or Greenback party, designed to "stop the present
suicidal and destructive policy of contraction." They declared their
belief that "a United States note, issued directly by the government and
convertible on demand into United States obligations, bearing a rate of
interest not exceeding one cent a day on each one hundred dollars and
exchangeable for United States notes at par, will afford the best
circulating medium ever devised." In spite of the small vote polled by
their standard bearer, Peter Cooper, of New York, they put forward a
candidate in the next campaign[37] and made a third attempt in 1884,
growing more and more radical in tone. In their last year, they
declared: "Never in our history have the banks, the land-grant
railroads, and other monopolies been more insolent in their demands for
further privileges--still more class legislation. In this emergency the
dominant parties are arrayed against the people and are the abject tools
of the corporate monopolies." The Greenbackers demanded, in addition to
currency reform, the regulation of interstate commerce, a graduated
income tax, labor legislation, prohibition of importation of contract
laborers, and the reduction of the terms of United States Senators.
Although their candidate, B. F. Butler, polled 175,000 votes in 1884,
the Greenbackers gave up the contest, and in 1888 yielded their place to
the Union Labor party.

The agrarian interest was, however, still the chief source of conscious
discontent, and the disappearance of the Greenbackers was shortly
followed by the establishment of two societies, the National Farmers'
Alliance and Industrial Union and the National Farmers' Alliance, the
former strong in the South and West, and the latter in the North. In
1890, these orders claimed over three million members, and in several of
the southern states they had dominated or split the Democratic party.
The Northern Alliance was likewise busy with politics, and in Kansas and
Nebraska, by independence or fusion, carried a large number of
legislative districts.

Although professing to be non-political in the beginning, the leaders of
these alliances called a national convention at Omaha in 1892 and put
forth the most radical platform that had yet appeared in American
politics. It declared that the newspapers were subsidized, corruption
dominated the ballot box, homes were covered with mortgages, labor was
impoverished and tyrannized over by a hireling standing army, and the
nation stood on the verge of ruin. "The fruits of the toils of
millions," runs the platform, "are boldly stolen to build up colossal
fortunes for a few, unprecedented in the history of mankind; and the
possessors of these in turn despise the republic and endanger liberty.
From the same prolific womb of governmental injustice we breed two
classes of tramps and millionaires." Their demands included the free
coinage of silver, a graduated income tax, postal-savings banks,
government ownership of railways, telegraph and telephones; they
declared their sympathy with organized labor in its warfare for better
conditions and its struggle against "Pinkerton hirelings"; and they
commended the initiative, referendum, and popular election of United
States Senators. On this program, the Populists polled over a million
votes and captured twenty-two presidential electors. Evidently the
indifference of the old parties to such issues could not remain
undisturbed much longer.

       *       *       *       *       *

Fuel was added to the discontent in the spring of 1895, when the Supreme
Court declared null and void the income tax law of the previous
year.[38] The opponents of the tax, having lost in the Congress, made
their last stand in the highest Federal tribunal, and marshaled on their
side an array of legal talent seldom seen in an action at law, including
Senator Edmunds, Mr. Joseph H. Choate, and other attorneys prominently
identified with railway and corporation litigation. No effort was spared
in bringing pressure to bear on the Court, and no arguments, legal,
political, and social, were neglected in the attempt to impress upon the
Court the importance of stopping Populism by a judicial pronunciamento.
Conservative New York papers, like the _Herald_, boldly prophesied in
the summer of 1894 that "the income tax will be blotted from the statute
books before the people are cursed with its inquisitorial enforcement."

No easy victory lay before the opponents of the income tax, for the law
seemed to be against them. In 1870, the Supreme Court had upheld the
Civil War income tax without a dissenting voice, and had distinctly
said: "Our conclusions are that direct taxes, within the meaning of the
Constitution, are only capitation taxes as expressed in that instrument
and taxes on real estate, and that the tax of which the plaintiff in
error complains [the income tax] is within the category of an excise or
duty." Of course, the terms of the new law were not identical with those
of the Civil War measure, and the Supreme Court had been known to
reverse itself.

The attorneys against the tax left no stone unturned. As Professor
Seligman remarks, "Some of the important financial interests now engaged
a notable array of eminent counsel to essay the arduous task of
persuading the Supreme Court that it might declare the income tax a
direct tax without reversing its previous decisions. The effort was made
with the most astonishing degree of ability and ingenuity, and the
briefs and arguments of the opposing counsel fill several large
volumes.... The counsel's arguments abound in historical errors and
economic inaccuracies.... Errors and misstatements which might be
multiplied pale into insignificance compared with the misinterpretation
put upon the origin and purpose of the direct-tax clause--a
misinterpretation which like most of the preceding mistakes was bodily
adopted by the majority of the Court, who evidently found no time for an
independent investigation of the subject." Having exhausted their
ingenuity in the matter of technicalities and imposing historical and
economic and legal arguments, the counsel appealed to every class fear
and prejudice that might be entertained by the Court.

The introduction of the passions of a social conflict into what
purported to be a legal contest was intrusted to Mr. Choate. He
threatened the Court with the declaration that if it approved the law,
and "the communistic march" went on, a still higher exemption of $20,000
might be made and a rate of 20 per cent imposed--a highly important
statement, but one that had no connection with the question whether an
income tax was a direct tax. "There is protection now or never," he
exclaimed. The very keystone of civilization, he continued, was the
preservation of the rights of private property, and this fundamental
principle was scattered to the winds by the champions of the tax. Mr.
Choate concluded by warning the Court not to pay any attention to the
popular passions enlisted on the side of the law, and urged it not to
hesitate in declaring the law unconstitutional, "no matter what the
threatened consequences of popular or populistic wrath may be."

The Court was evidently moved by the declamation of Mr. Choate, for
Justice Field, in his opinion, replied in kind. "The present assault
upon capital," he said, "is but the beginning. It will be but the
stepping stone to others larger and more sweeping till our political
conditions will become a war of the poor against the rich; a war
growing in intensity and bitterness." If such a law were upheld, he
gravely announced, boards of walking delegates would be fixing tax rates
in the near future. Mr. Justice Harlan, in his dissenting opinion,
however, replied in behalf of the populace by saying: "The practical
effect of the decision to-day is to give certain kinds of property a
position of favoritism and advantage inconsistent with the fundamental
principles of our social organization, and to invest them with power and
influence that may be perilous to that portion of the American people
upon whom rests the larger part of the burdens of government and who
ought not to be subjected to the dominion of aggregated wealth any more
than the property of the country should be at the mercy of the lawless."

At the best, the nullification of the income tax law was not an easy
task. There were eight justices on the bench when the decision of the
Court was handed down on April 8, 1895. All of them agreed that the law
was unconstitutional in so far as it laid a tax on revenues derived from
state and municipal bonds; five of them agreed that a tax on rent or
income from land was a direct tax and hence unconstitutional unless
apportioned among the states on the basis of population--which was
obviously impolitic; and the Court stood four to four on the important
point as to the constitutionality of taxes on incomes derived from
mortgages, interest, and personal property generally. The decision of
the Court was thus inconclusive on the only point that interested
capitalists particularly, and it was so regarded by the Eastern press.

On April 9, the day following the decision of the Court, the New York
_Sun_ declared: "Twice in great national crises the Supreme Court of the
United States has failed to meet the expectations of the people or to
justify its existence as the ultimate tribunal of right and law. In both
instances the potent consideration has been neither right nor law, but
the supposed demands of political expediency.... Yesterday the failure
of the Supreme Court to decide the main question of constitutionality
submitted to it was brought about by political considerations. It was
not Democracy against Republicanism as before, but Populism and
Clevelandism against Democracy, and the vote was four to four." The
_Tribune_, on April 10, declared that "the Court reached a finding which
is as near an abdication of its power to interpret the Constitution and
a confession of its unfitness for that duty as anything well can be."

In view of the unsatisfactory condition created by its decision, the
Court consented to a rehearing, and, on May 20, 1895, added its opinion
that the tax on incomes from personal property was also a direct tax,
thus bringing the whole law to the ground by a vote of five to four.
Justice Jackson, who was ill when the first decision was made, had in
the meantime returned to the bench, and he was strongly in favor of
declaring the law constitutional. Had the Court stood as before, the
personal property income tax would have been upheld, but one Justice,
who had sustained this particular provision in the first case, was
induced to change his views and vote against it on the final count. Thus
by a narrow vote of five to four, brought about by a Justice who
changed his mind within the period of a few days, all of the essential
parts of the income tax law were declared null and void.

The temper of the country over the affair was well manifested in the
press comments on the last decision. The New York _Sun_, which had
roundly denounced the Court in the first instance, now joined in a
chorus of praise: "In a hundred years the Supreme Court of the United
States has not rendered a decision more important in its immediate
effect or reaching further in its consequences than that which the _Sun_
records this morning. There is life left in the institutions which the
founders of this republic devised and constructed. There is a safe
future for the national system under which we were all born and have
lived and prospered according to individual capacity. The wave of
socialistic revolution has gone far, but it breaks at the foot of the
ultimate bulwark set up for protection of our liberties. Five to four,
the court stands like a rock."

The _Tribune_, on May 24, added: "The more the people study the
influences behind this attempt to bring about a communistic revolution
in modes of taxation, the more clearly they will realize that it was an
essential part of the distinctly un-American and unpatriotic attempt to
destroy the American policy of defense for home industries, in the
interest of foreigners.... Thanks to the Court, our government is not to
be dragged into communistic warfare against rights of property and the
rewards of industry while the Constitution of its founders remains a
bulwark of the rights of states and of individual citizens."

The New York _World_, on the other hand, which had so stoutly championed
the tax in behalf of "the masses," represented the decision of the Court
as "the triumph of selfishness over patriotism. It is another victory of
greed over need. Great and rich corporations, by hiring the ablest
lawyers in the land and fighting against a petty tax upon superfluity as
other men have fought for their liberties and their lives, have secured
the exemption of wealth from paying its just share towards the support
of the government that protects it.... The people at large will bow to
this decision as they habitually do to all the decrees of their highest
courts. But they will not accept law as justice. No dictum or decision
of any wrong can make wrong right, and it is not right that the entire
cost of the Federal government shall rest upon consumption.... Equity
demands that citizens shall contribute to the support of the government
with some regard to benefits received and ability to pay."

       *       *       *       *       *

Although the conservative elements saw in the annulment of the income
tax nothing but a wise and timely exercise of judicial authority in
defense of the Constitution and sound policy, the radical elements
regarded it as an evidence "that the judicial branch of the government
was under the control of the same interests that had mutilated the
Wilson tariff bill in the Senate." The local Federal courts augmented
this popular feeling by frequently issuing injunctions ordering
workingmen in time of strikes not to interfere with their employers'
business, thus crippling them in the coercion of employers, by
imprisoning without jury trial those who disobeyed judicial orders.

Although the injunction was an ancient legal device, it was not until
after the Civil War that it was developed into a powerful instrument in
industrial disputes; and it became particularly effective in the hands
of Federal judges. They were not popularly elected, but were appointed
by the President and the Senate (where corporate influences were ably
represented). Under the provisions of the law giving Federal courts
jurisdiction in cases involving citizens of different states, they were
called upon to intervene with increasing frequency in industrial
disputes, for railway and other corporations usually did business in
several states, and they could generally invoke Federal protection by
showing that they were "non-residents" of the particular states in which
strikes were being waged. Moreover, strikers who interfered with
interstate commerce were likely to collide with Federal authorities
whose aid was invited by the employers affected. Whenever a corporation
was in bankruptcy, control over its business fell into the hands of the
Federal courts.

The effectiveness of Federal judicial intervention in labor troubles
became apparent in the first great strikes of the seventies, when the
state authorities proved unable to restrain rioting and disorder by the
use of the local militia. During the railway war of 1877 a Federal judge
in southern Illinois ordered the workingmen not to interfere with a
railway for which he had appointed a receiver, and he then employed
Federal troops under the United States marshal to execute his mandate.
About the same time other Federal judges intervened effectively in
industrial disputes by the liberal use of the injunction, and the
president of the Pennsylvania Railroad Company pointed out in an article
published in the _North American Review_ for September, 1877, how much
more potent Federal authority was in such trying crises to give railway
corporations efficient protection.

From that time forward the injunction was steadily employed by Federal
and state courts, but it was not until the great railway strike of 1894
in Chicago that it was brought prominently before the country as a
distinct political issue. In that strike, the Democratic governor, Mr.
Altgeld, believing that the employers had fomented disorder for the
purpose of invoking Federal intervention (as was afterward pretty
conclusively shown), refused to employ the state militia speedily and
effectively, contending that the presence of troops would only make
matters worse. The postal authorities, influenced by a variety of
motives, of which, it was alleged, a desire to break the strike was one,
secured prompt Federal intervention on the part of President Cleveland
and the use of Federal troops. Thus the labor unions were quickly
checkmated.

This action on the part of President Cleveland was supplemented in July,
1894, by a general blanket injunction issued from the Federal district
court in Chicago to all persons concerned, ordering them not to
interfere with the transmission of the mails or with interstate commerce
in any form. Mr. Debs, president of the American Railway Union, who was
directing the strike which was tying up interstate commerce, was
arrested, fined, and imprisoned for refusing to obey this injunction.
Mr. Debs, thereupon, through his counsel, claimed the right to jury
trial, asserting that the court could not impose a penalty which was not
provided by statute, but which depended solely upon the will of the
judge. On appeal, the Supreme Court of the United States upheld the
lower court and declared that imprisonment for contempt of court did not
violate the principle of jury trial.

It was not merely labor leaders who were stirred to wrath by this
development in judicial authority. Many eminent lawyers saw in it an
attack upon the ancient safeguards of the law which provided for regular
proceedings, indictment, the hearing of witnesses, jury trial, and the
imposition of only such punishments as could be clearly ascertained in
advance. On the other hand others held it to be nothing new at all, but
simply the application of the old principle that injunctions could issue
in cases where irreparable injury might otherwise ensue. They pointed
out that its effectiveness depended upon speedy application, and that
the delays usually incident to regular judicial procedure would destroy
its usefulness altogether. To workingmen it appeared to be chiefly an
instrument for imprisoning their leaders and breaking strikes by the
prevention of coercion, peaceful or otherwise. At all events, the
decision of the Supreme Court upholding the practice and its doctrines
added to the bitterness engendered by the income tax decision--a
bitterness manifested at the Democratic convention at Chicago the
following year.

The crowning cause of immediate discontent was the financial policy
pursued by President Cleveland,[39] which stirred the wrath of the
agrarians already agitated over inflation, and gave definiteness to an
issue on which both parties had been judiciously ambiguous in their
platforms in 1892. The farmers pointed out that, notwithstanding the
increased output of corn, the total amount of money received in return
was millions less than it had been in the early eighties. They
emphasized the fact that more than half of the taxable acreage of Kansas
and Nebraska was mortgaged, and that many other western states were
nearly as badly off. The falling prices and their inability to meet
their indebtedness they attributed to the demonetization of silver and
the steady enhancement of gold.

For the disease, as they diagnosed it, they had a remedy. The
government, they said, had been generous to Wall Street and financial
interests at large by selling bonds at rates which made great fortunes
for the narrow group of purchasers, and by distributing its deposits
among the banks in need of assistance. The power of the government could
also be used for the benefit of another class--namely, themselves. Gold
should be brought down and the currency extended by the free coinage of
silver on a basis of sixteen to one. The value of crops, when measured
in money, would thus mount upwards, and it would be easier to pay the
interest on mortgages and discharge their indebtedness. Furthermore,
while the government was in the business of accommodating the public it
might loan money to the farmers at a low rate of interest.[40] But the
inflation of the currency and the increase of prices of farm products by
the free coinage of silver were the leading demands of the discontented
agrarians--an old remedy for an old disease.

FOOTNOTES:

     [34] See below, p. 296.

     [35] See above, p. 121.

     [36] See above, pp. 67 ff.

     [37] They polled about a million votes in the congressional
     elections of 1878.

     [38] See above, p. 137.

     [39] See above, p. 106.

     [40] It is interesting to note that agricultural credit--a
     subject in which European countries are far advanced--is just
     now beginning to receive some attention in quarters where the
     demands of the farmers for better terms on borrowed money
     were once denounced as mere vagaries.




CHAPTER VII

THE CAMPAIGN OF 1896


It does not require that distant historical perspective, which is
supposed to be necessary for final judgments, to warrant the assertion
that the campaign of 1896 marks a turning point in the course of
American politics. The monetary issue, on which events ostensibly
revolved, was, it is true, an ancient one, but the real conflict was not
over the remonetization of silver or the gold standard. Deep, underlying
class feeling found its expression in the conventions of both parties,
and particularly that of the Democrats, and forced upon the attention of
the country, in a dramatic manner, a conflict between great wealth and
the lower middle and working classes, which had hitherto been recognized
only in obscure circles. The sectional or vertical cleavage of American
politics was definitely cut by new lines running horizontally through
society, and was also crossed at right angles by another line running
north and south, representing the western protest against eastern
creditors and the objectionable methods of great corporations which had
been rapidly unfolded to public view by merciless criticism and many
legislative investigations.

Even the Republican party, whose convention had been largely prepared in
advance by the vigorous labors of Mr. Marcus A. Hanna,[41] was not
untouched by the divisions which later rent the Democratic party in
twain. When the platform was reported to the duly assembled Republican
delegates by Mr. Foraker, of Ohio, its firm declaration of opposition to
free silver, except by international agreement, was greeted by a divided
house, although, as the record runs, there was a "demonstration of
approval on the part of a large majority of the delegates which lasted
several minutes." When a vote was taken on the financial plank, it was
discovered that 110 delegates favored silver as against 812 in support
of the proposition submitted by the platform committee. The defeated
contingent then withdrew from the convention after having presented a
statement in which they declared that "the people cry aloud for relief;
they are bending under a burden growing heavier with the passing hours;
endeavour no longer brings its just reward ... and unless the laws of
the country and the policies of political parties shall be converted
into mediums of redress, the effect of human desperation may sometime be
witnessed here as in other lands and in other ages."

This threat was firmly met by the body of the convention which remained.
In nominating Mr. Thomas B. Reed, Mr. Lodge, of Massachusetts, declared:
"Against the Republican party are arrayed not only that organized
failure, the Democratic party, but all the wandering forces of political
chaos and social disorder.... Such a man we want for our great office in
these bitter times when the forces of disorder are loose and the
wreckers with their false lights gather at the shore to lure the ship
of state upon the rocks." Mr. Depew, in nominating Mr. Levi P. Morton,
decried all of the current criticism of capital. Mr. Foraker, in
presenting the name of Mr. McKinley, was more conciliatory: distress and
misery were abroad in the land and bond issues and bond syndicates had
discredited and scandalized the country; but McKinley was the man to
redeem the nation.

This conciliatory attitude was hardly necessary, for there were no
radical elements in the Republican assembly after the withdrawal of the
silver faction. The proceedings of the convention were in fact then
extraordinarily harmonious, brief, and colorless. The platform, apart
from the sound money plank, contained no sign of the social conflict
which was being waged in the world outside. Tariff, pensions, civil
service, temperance, and the usual formalities of party programs were
treated after the fashion consecrated by time. Railway and trust
problems were overlooked entirely. Even the money plank was not put
first, and it was not so phrased as to constitute the significant
challenge which it became in the campaign. "The Republican party," it
ran, "is unreservedly for sound money. It caused the enactment of the
law providing for the resumption of specie payments in 1879; since then
every dollar has been good as gold. We are unalterably opposed to every
measure calculated to debase our currency or impair the credit of our
country. We are, therefore, opposed to the free coinage of silver except
by international agreement with the leading commercial nations of the
world, which we pledge ourselves to promote, and until such an agreement
can be obtained the existing gold standard must be maintained."

This clear declaration on the financial issue was apparently not a part
of the drama as Mr. Hanna and Mr. McKinley had staged it. The former was
in favor of the gold standard so far as he understood it, but he was not
a student of finance, and he was more interested "in getting what we
got," to use his phrase, than in any very fine distinctions in the gold
plank. Mr. McKinley, on the other hand, was widely known as a
bimetallist; but his reputation throughout the country rested
principally upon his high protective doctrines. He, therefore, wished to
avoid the monetary issue by straddling it in such a way as not to
alienate the large silver faction in the West. Mr. Hanna's biographer
tells us that Mr. Kohlsaat claims to have spent hours on Sunday, June 7,
"trying to convince Mr. McKinley of the necessity of inserting the word
'gold' in the platform. The latter argued in opposition that 90 per cent
of his mail and his callers were against such decisive action, and he
asserted emphatically that thirty days after the convention was over the
currency question would drop out of sight and the tariff would become
the sole issue. The currency plank, tentatively drawn by Mr. McKinley
and his immediate advisers, embodied his resolution to keep the currency
issue subordinate and vague."[42] The leaders in the convention,
however, refused to accept Mr. McKinley's view and forced him to take
the step which he had hoped to avoid.

In his speech of acceptance, McKinley deprecated and sought to smooth
over the class lines which had been drawn. "It is a cause for painful
regret and solicitude," he said, "that an effort is being made by those
high in the counsels of the allied parties to divide the people of this
country into classes and create distinctions among us which in fact do
not exist and are repugnant to our form of government.... Every attempt
made to array class against class, 'the classes against the masses,'
section against section, labor against capital, 'the poor against the
rich,' or interest against interest in the United States is in the
highest degree reprehensible." In the Populist features of the
Democratic platform he saw a grave menace to our institutions, but he
accepted the challenge. "We avoid no issues. We meet the sudden,
dangerous, and revolutionary assault upon law and order and upon those
to whom is confided by the Constitution and laws the authority to uphold
and maintain them, which our opponents have made, with the same courage
that we have faced every emergency since our organization as a party
more than forty years ago."


_The Democratic Convention_

No doubt the decisive action of the Republican convention helped to
consolidate the silver forces in the Democratic party; but even if the
Republicans had obscured the silver question by a vague declaration,
their opponents would have come out definitely against the gold
standard. This was so apparent weeks before the Democratic national
assembly met, that conservatives in the party talked of refusing to
participate in the party councils, called at Chicago on July 7. They
were aware also that other and deeper sources of discontent were bound
to manifest themselves when the proceedings got under way.

The storm which broke over the party had long been gathering. The Grange
and Greenback movements did not disappear with the disappearance of the
outward signs of organization; they only merged into the Populist
movement with cumulative effect. The election of 1892 was ominous, for
the agrarian party had polled a million votes. It had elected members of
Congress and presidential electors; it was organized and determined. It
arose from a mass of discontent which was justified, if misdirected. It
was no temporary wave, as superficial observers have imagined. It had
elements of solidity which neither of the old parties could ignore or
cover up. No one was more conscious of this than the western and
southern leaders in the Democratic party. They had been near the base of
action, and they thought that what the eastern leaders called a riot was
in fact the beginning of a revolution. Unwilling to desert their
traditional party, they decided to make the party desert its traditions,
and they came to the Democratic convention in Chicago prepared for war
to the hilt.

From the opening to the close, the Democratic convention in Chicago in
1896 was vibrant with class feeling. Even in the prayer with which the
proceedings began, the clergyman pleaded: "May the hearts of all be
filled with profound respect and sympathy for our toiling multitudes,
oppressed with burdens too heavy for them to bear--heavier than we
should allow them to bear,"--a prayer that might have been an echo of
some of the speeches made in behalf of the income tax in Congress.

The struggle began immediately after the prayer, when the presiding
officer, on behalf of the retiring national committee, reported as
temporary chairman of the convention, David B. Hill, of New York, the
unrelenting opponent of the income tax and everything that savored of
it. Immediately afterward, Mr. Clayton, speaking in behalf of
twenty-three members of the national committee as opposed to
twenty-seven, presented a minority report which proposed the Honorable
John W. Daniel, of Virginia, as chairman. Pleas were made that the
traditions of the party ought not to be violated by a refusal to accept
the recommendations of the national committee.

After a stormy debate, the minority report of the national committee,
proposing Mr. Daniel for chairman, was carried by a vote of 556 to 349.
The states which voted solidly or principally for Mr. Hill were
Connecticut, Delaware, Massachusetts, Michigan, Nebraska, New Hampshire,
New Jersey, New York, Pennsylvania, Rhode Island, South Dakota, Vermont,
Wisconsin, and Alaska--all of the New England and Central seaboard
states, which represented the accumulated wealth of the country. The
official proceedings of the convention state, "When the result of this
vote was announced, there was a period of nearly twenty minutes during
which no business could be transacted, on account of the applause,
cheers, noise and confusion."

In his opening speech as chairman, Mr. Daniel declared that they were
witnessing "an uprising of the people for American emancipation from the
conspiracies of European kings led by Great Britain, which seek to
destroy one half of the money of the world." He declared in favor of
bimetallism and devoted most of his speech to the monetary question and
to repeated declarations of financial independence in behalf of the
United States. He also attacked, however, the tax system which the
Democrats inherited from the Republicans in 1893, and in speaking of the
deficit which was incurred under the Democratic tariff act he declared
that it would have been met by the income tax incorporated in the tariff
bill "had not the Supreme Court of the United States reversed its
settled doctrines of a hundred years." On the second day of the
convention, while the committees were preparing their reports, Governor
Hogg, of Texas, Senator Blackburn, of Kentucky, Governor Altgeld, of
Illinois, and other gentlemen were invited to address the convention.

The first of these speakers denounced the Republican party as a "great
class maker and mass smasher"; he scorned that "farcical practice" which
had given governmental protection to the wealthy and left the laborer to
protect himself. "This protected class of Republicans," he exclaimed,
"proposes now to destroy labor organizations. To that end it has
organized syndicates, pools, and trusts, and proposes through the
Federal courts, in the exercise of their unconstitutional powers by the
issuance of extraordinary unconstitutional writs, to strike down, to
suppress, and to overawe those organizations, backed by the Federal
bayonet.... Men who lived there in their mansions and rolled in luxuries
were the only ones to get the benefit of this Republican [sugar] bounty
called protection." Senator Blackburn, of Kentucky, exclaimed that
"Christ with a lash drove from the temple a better set of men than those
who for twenty years have shaped the financial policy of this country."
Governor Altgeld declared: "We have seen the streets of our cities
filled with idle men, with hungry women, and with ragged children. The
country to-day looks to the deliberations of this convention to promise
some form of relief." This relief was to be secured by the
remonetization of silver and the emancipation of the country from
English capitalists and eastern financiers.

       *       *       *       *       *

On the third day of the convention, Senator Jones, of Arkansas, chairman
of the committee on platform, reported the conclusions of the majority
of his committee. In the platform, as reported, there were many
expressions of class feeling. It declared that the act of 1873
demonetizing silver caused a fall in the price of commodities produced
by the people, a heavy increase in the public taxation and in all debts,
public and private, the enrichment of the money-lending class at home
and abroad, the prostration of industry, and the impoverishment of the
people. The McKinley tariff was denounced as "a prolific breeder of
trusts and monopolies" which had "enriched the few at the expense of
the many."

The platform made the money question, however, the paramount issue, and
declared for "the free and unlimited coinage of both silver and gold at
the present legal ratio of sixteen to one without waiting for the aid or
consent of any other nation." It stated that, until the monetary
question was settled, no changes should be made in the tariff laws
except for the purpose of meeting the deficit caused by the adverse
decision of the Supreme Court in the income tax cases. The platform at
this point turned upon the Court and asserted that the income tax law
had been passed "by a Democratic Congress in strict pursuance of the
uniform decisions of that Court for nearly a hundred years." It then
hinted at a reconstruction of the Court, declaring that, "it is the duty
of Congress to use all the constitutional power which remains after that
decision or which may come from its reversal by the Court, as it may
hereafter be constituted, so that the burden of taxation may be equally
and impartially laid, to the end that wealth may bear its due proportion
of the expense of the government."

The platform contained many expressions of sympathy with labor. "As
labor creates the wealth of the country," ran one plank, "we demand the
passage of such laws as may be necessary to protect it in all its
rights." It favored arbitration for labor conflicts in interstate
commerce. Referring to the recent Pullman strike and the labor war in
Chicago, it denounced "arbitrary interference by Federal authorities in
local affairs as a violation of the Constitution of the United States
and a crime against free institutions, and we specially object to
government by injunction as a new and highly dangerous form of
oppression by which Federal judges, in contempt of the laws of the
states and rights of citizens, become at once legislators, judges, and
executioners; and we approve the bill passed by the last session of the
United States Senate, and now pending in the House of Representatives,
relative to contempt in Federal courts and providing for trials by jury
in certain cases of contempt."

The platform did not expressly attack the administration of President
Cleveland, but the criticism of the intervention by Federal authorities
in local affairs was directed particularly to his interference in the
Chicago strike. The departure from the ordinary practice of praising the
administration of the party's former leader itself revealed the feeling
of the majority of the convention.

A minority of the platform committee composed of sixteen delegates
presented objections to the platform as reported by Senator Jones and
offered amendments. In their report the minority asserted that many
declarations in the majority report were "ill-considered and ambiguously
phrased, while others are extreme and revolutionary of the
well-recognized principles of the party." The free coinage of silver
independently of other nations, the minority claimed, would place the
United States at once "upon a silver basis, impair contracts, disturb
business, diminish the purchasing powers of the wages of labor, and
inflict irreparable evils upon our nation's commerce and industry." The
minority, therefore, proposed the maintenance of the existing gold
standard; and concluded by criticizing the report of the majority as
"defective in failing to make any recognition of the honesty, economy,
courage, and fidelity of the present Democratic administration." This
minority report was supplemented by two amendments proposed by Senator
Hill, one to the effect that any change in the monetary standard should
not apply to existing contracts and the other pledging the party to
suspend, within one year from its enactment, the law providing for the
independent free coinage of silver, in case that coinage did not realize
the expectation of the party to secure a parity between gold and silver
at the ratio of sixteen to one.

After the presentation of the platform and the proposed changes, an
exciting and disorderly debate followed. The discussion was opened by
Mr. Tillman, who exclaimed that the Civil War had emancipated the black
slaves and that they were now in convention to head a fight for the
emancipation of the white slaves, even if it disrupted the Democratic
party as the Civil War had disrupted it. Without any equivocation and
amid loud and prolonged hissing, he declared that the new issue like the
old one was sectional--a declaration of political war on the part of the
hewers of wood and the drawers of water in the southern and western
states against the East. He compared the growth of fifteen southern
states in wealth and population with the growth of Pennsylvania; he
compared Ohio, Indiana, Illinois, Iowa, and Missouri with Massachusetts;
to these five western states he added Kentucky, Tennessee, Kansas, and
Nebraska, and compared them all with the state of New York. The upshot
of his comparison was that the twenty-five southern and western states
were in economic bondage to the East and that we now had a money
oligarchy more insolent than the slave oligarchy which the Civil War had
overthrown.

Mr. Tillman could scarcely contain his wrath when he came to a
consideration of the proposal to indorse Cleveland's administration. He
denounced the Democratic President as "a tool of Wall Street"; and
declared that they could not indorse him without writing themselves down
as "asses and liars." "They ask us to indorse his courage," exclaimed
Mr. Tillman. "Well, now, no one disputes the man's boldness and
obstinacy, because he had the courage to ignore his oath of office, and
redeem, in gold, paper obligations of the government, which were payable
in coin--both gold and silver, and, furthermore, he had the courage to
override the Constitution of the United States and invaded the state of
Illinois with the United States army and undertook to override the
rights and liberties of his fellow citizens. They ask us to indorse his
fidelity. He has been faithful unto death, or rather unto the death of
the Democratic party, so far as he represents it, through the policy of
the friends that he had in New York and ignored the entire balance of
the Union." Mr. Tillman was dissatisfied with the platform because it
did not attack Mr. Cleveland's policies, and, amid great confusion
throughout the hall, he proposed that the platform should "denounce the
administration of President Cleveland as undemocratic and tyrannical."
He warned the convention that, "If this Democratic ship goes to sea on
storm-tossed waves without fumigating itself, without express
repudiation of this man who has sought to destroy his party, then the
Republican ship goes into port and you go down in disgrace, defeated in
November." In his proposed amendment to the platform, he asserted that
Cleveland had used the veto power to thwart the will of the people, and
the appointive power to subsidize the press and debauch Congress. The
issue of bonds to purchase gold, to discharge obligations payable in
coin at the option of the government, and the use of the proceeds for
ordinary expenses, he denounced as "unlawful and usurpations of
authority deserving of impeachment."

After Senator Jones was given the floor for a few moments to repudiate
the charge brought by Mr. Tillman that the fight was sectional in
character, Senator Hill, of New York, began the real attack upon the
platform proposed by the majority. The Senator opened by saying that he
was a Democrat, but not a revolutionist, that the question before them
was one of business and finance, not of bravery and loyalty, and that
the first step toward monetary reform should be a statement in favor of
international bimetallism. He followed this by a special criticism of
the declaration in favor of the ratio of sixteen to one which was, in
his opinion, not only an unwise and unnecessary thing, but destined to
return to plague them in the future.

Senator Hill then turned to the income tax which he had so vigorously
denounced on the floor of the Senate two years before. "What was the
necessity," he asked, "for putting into the platform other questions
which have never been made the tests of Democratic loyalty before? Why
revive the disputed question of the policy and constitutionality of an
income tax?... Why, I say, should it be left to this convention to make
as a tenet of Democratic faith belief in the propriety and
constitutionality of an income tax law?

"Why was it wise to assail the Supreme Court of your country? Will some
one tell what that clause means in this platform? 'If you meant what you
said and said what you meant,' will some one explain that provision?
That provision, if it means anything, means that it is the duty of
Congress to reconstruct the Supreme Court of the country. It means, and
such purpose was openly avowed, it means the adding of additional
members to the Court or the turning out of office and reconstructing the
whole Court. I said I will not follow any such revolutionary step as
that. Whenever before in the history of this country has devotion to an
income tax been made the test of Democratic loyalty? Never! Have you not
undertaken enough, my good friends, now without seeking to put in this
platform these unnecessary, foolish, and ridiculous things?"

"What further have you done?" continued the Senator. "In this platform
you have declared, for the first time in the history of this country,
that you are opposed to any life tenure whatever for office. Our fathers
before us, our Democratic fathers, whom we revere, in the establishment
of this government, gave our Federal judges a life tenure of office.
What necessity was there for reviving this question? How foolish and how
unnecessary, in my opinion. Democrats, whose whole lives have been
devoted to the service of the party, men whose hopes, whose ambitions,
whose aspirations, all lie within party lines, are to be driven out of
the party upon this new question of life tenure for the great judges of
our Federal courts. No, no; this is a revolutionary step, this is an
unwise step, this is an unprecedented step in our party history."

Senator Hill then turned to a defense of President Cleveland's policy,
denouncing the attempt to bring in the bond issue as foolish and
calculated to put them on the defensive in every school district in the
country. He closed by begging the convention not "to drive old Democrats
out of the party who have grown gray in the service, to make room for a
lot of Republicans and Populists, and political nondescripts."

Senator Hill's protest was supported by Senator Vilas from Wisconsin,
who saw in the proposed free coinage of silver no difference, except in
degree, between "the confiscation of one half of the credits of the
nation for the benefit of debtors," and "a universal distribution of
property." In this radical scheme there was nothing short of "the
beginning of the overthrow of all law, of all justice, of all security
and repose in the social order." He warned the convention that the
American people would not tolerate the first steps toward the atrocities
of the French Revolution, although "in the vastness of this country
there may be some Marat unknown, some Danton or Robespierre." He asked
the members of the convention when and where robbery by law had come to
be a Democratic doctrine, and with solemn earnestness he pleaded with
them not to launch the old party out on a wild career or to "pull down
the pillars of the temple and crush us all beneath the ruins." He
declared that the gold standard was not responsible for falling prices;
that any stable standard had "no more to do with prices than a yard
stick or a pair of scales." He begged them to adopt the proposed
amendment which would limit the effect of the change of standards to
future contracts and thus deliver the platform from an imputation of a
purpose to plunder.

The closing speech for the platform was then made by Mr. William
Jennings Bryan, of Nebraska, who clothed his plea in the armor of
righteousness, announcing that he had come to speak "in defense of a
cause as holy as the cause of liberty--the cause of humanity." The
spirit and zeal of a crusader ran through his speech. Indeed, when
speaking of the campaign which the Silver Democrats had made to capture
the party, he referred to that frenzy which inspired the crusaders under
the leadership of Peter the Hermit. He spoke in defense of the wage
earner, the lawyer in the country town, the merchant at the crossroads
store, the farmer and the miner,--naming them one after the other and
ranging himself on their side. "We stand here," he said, "representing
people who are the equals before the law of the largest cities in the
state of Massachusetts. When you come before us and tell us that we
shall disturb your business interests, we reply that you have disturbed
our business interests by your action. We say to you that you have made
too limited in its application the definition of a business man. The man
who is employed for wages is as much a business man as his employer. The
attorney in a country town is as much a business man as the corporation
counsel in a great metropolis. The merchant at the crossroads store is
as much a business man as the merchant of New York. The farmer who goes
forth in the morning and toils all day, begins in the spring and toils
all summer, and by the application of brain and muscle to the natural
resources of this country creates wealth, is as much a business man as
the man who goes upon the Board of Trade and bets upon the price of
grain. The miners who go a thousand feet into the earth or climb two
thousand feet upon the cliffs, and bring forth from their hiding places
the precious metals to be poured in the channels of trade, are as much
business men as the few financial magnates who, in a back room, corner
the money of the world.

"We come to speak for this broader class of business men. Ah, my
friends, we say not one word against those who live upon the Atlantic
coast; but those hardy pioneers who braved all the dangers of the
wilderness, who have made the desert to blossom as the rose--those
pioneers away out there, rearing their children near to nature's heart,
where they can mingle their voices with the voices of the birds--out
there where they have erected schoolhouses for the education of their
children and churches where they praise their Creator, and the
cemeteries where sleep the ashes of their dead--are as deserving of the
consideration of this party as any people in this country.

"It is for these that we speak. We do not come as aggressors. Our war is
not a war of conquest. We are fighting in the defense of our homes, our
families, and posterity. We have petitioned, and our petitions have
been scorned. We have entreated, and our entreaties have been
disregarded. We have begged, and they have mocked when our calamity
came.

"We beg no longer; we entreat no more; we petition no more. We defy
them!"

Mr. Bryan then took up the income tax. He repudiated the idea that the
proposed platform contained a criticism of the Supreme Court. He said,
"We have simply called attention to what you know. If you want
criticisms, read the dissenting opinions of the court." He denied that
the income tax law was unconstitutional when it was passed, or even when
it went before the Supreme Court for the first time. "It did not become
unconstitutional," he exclaimed, "until one judge changed his mind; and
we cannot be expected to know when a judge will change his mind."

The monetary question was the great paramount issue. But Mr. Bryan did
not stop to discuss any of the technical points involved in it.
Protection had slain its thousands, and the gold standard had slain its
tens of thousands; the people of the United States did not surrender
their rights of self-government to foreign potentates and powers. The
common people of no land had ever declared in favor of the gold
standard, but bondholders had. If the gold standard was a good thing,
international bimetallism was wrong; if the gold standard was a bad
thing, the United States ought not to wait for the help of other nations
in righting a wrong--this was the line of Mr. Bryan's attack. And he
concluded by saying: "Mr. Carlisle said, in 1878, that this was a
struggle between the idle holders of idle capital and the struggling
masses who produce the wealth and pay the taxes of the country; and, my
friends, it is simply a question that we shall decide upon which side
shall the Democratic party fight? Upon the side of the idle holders of
idle capital, or upon the side of the struggling masses? That is the
question that the party must answer first; and then it must be answered
by each individual hereafter. The sympathies of the Democratic party, as
described by the platform, are on the side of the struggling masses, who
have ever been the foundation of the Democratic party.

"There are two ideas of government. There are those who believe that if
you just legislate to make the well-to-do prosperous, their prosperity
will leak through on those below. The Democratic idea has been that if
you legislate to make the masses prosperous, their prosperity will find
its way up and through every class that rests upon it.

"You come to us and tell us that the great cities are in favor of the
gold standard. I tell you that the great cities rest upon these broad
and fertile prairies. Burn down your cities and leave our farms, and
your cities will spring up again as if by magic. But destroy our farms,
and the grass will grow in the streets of every city in this country.

"My friends, we shall declare that this nation is able to legislate for
its own people on every question, without waiting for the aid or consent
of any other nation on earth, and upon that issue we expect to carry
every single State in this Union.

"I shall not slander the fair State of Massachusetts, nor the State of
New York, by saying that when its citizens are confronted with the
proposition, 'Is this nation able to attend to its own business?'--I
will not slander either one by saying that the people of those States
will declare our helpless impotency as a nation to attend to our own
business. It is the issue of 1776 over again. Our ancestors, when but
3,000,000, had the courage to declare their political independence of
every other nation upon earth. Shall we, their descendants, when we have
grown to 70,000,000, declare that we are less independent than our
forefathers? No, my friends, it will never be the judgment of this
people. Therefore, we care not upon what lines the battle is fought. If
they say bimetallism is good, but we cannot have it till some nation
helps us, we reply that, instead of having a gold standard because
England has, we shall restore bimetallism, and then let England have
bimetallism because the United States have.

"If they dare to come out and in the open defend the gold standard as a
good thing, we shall fight them to the uttermost, having behind us the
producing masses of the Nation and the world. Having behind us the
commercial interests and the laboring interests and all the toiling
masses, we shall answer their demands for a gold standard by saying to
them, you shall not press down upon the brow of labor this crown of
thorns. You shall not crucify mankind upon a cross of gold."

The record of the convention states that "the conclusion of Mr. Bryan's
speech was the signal for a tremendous outburst of noise, cheers, etc.
The standards of many states were carried from their places and
gathered about the Nebraska delegation." Never in the history of
convention oratory had a speaker so swayed the passions of his auditors
and so quickly made himself unquestionably "the man of the hour."

After some parliamentary skirmishing, Mr. Hill succeeded in securing
from the convention a vote on the proposition of the minority in favor
of the maintenance of the gold standard, "until international
cooperation among the leading nations in the coinage of silver can be
secured." For this proposition the eastern states voted almost solidly,
with some help from the western states. Connecticut gave her twelve
votes for the substitute amendment; Delaware, five of her six votes;
Maine, ten out of twelve; Maryland, twelve out of sixteen;
Massachusetts, twenty-seven out of thirty; New Hampshire, New Jersey,
New York, Pennsylvania, Rhode Island, and Vermont gave their entire vote
for the gold standard. The eastern states secured a little support in
the West and South. Minnesota gave eleven out of seventeen votes for the
amendment; Wisconsin voted solidly for it; Florida gave three out of
eight votes; Washington gave three out of eight; Alaska voted solidly
for it; the District of Columbia and New Mexico each cast two out of the
six votes allotted to them in the convention. Out of a total of 929
votes cast, 303 were for the minority amendment and 626 against it.

The minority proposition to commend "the honesty, economy, courage, and
fidelity of the present Democratic administration" was then put to the
convention and received a vote of 357 to 564--nine not voting. The
additional support to the eastern states came this time principally from
California, Michigan, and Minnesota; but the division between the
Northeast and the West and South was sharply maintained. The adoption of
the platform as reported by the majority of the committee was then
effected by a vote of 628 to 301.

       *       *       *       *       *

In the evening the convention turned to the selection of candidates. In
the nominating speeches, the character of the revolution in American
politics came out even more clearly than in the debates on the platform.
The enemy had been routed, and the convention was in the hands of the
radicals, and they did not have to compromise and pick phrases in the
hope of harmony.

Richard Bland, of Missouri, was the first man put before the convention,
and he was represented as "the living, breathing embodiment of the
silver cause"--a candidate chosen "not from the usurer's den, nor temple
of Mammon where the clink of gold drowns the voice of patriotism; but
from the farm, the workshop, the mine--from the hearts and homes of the
people." Mr. Overmeyer, of Kansas, seconded the nomination of Mr.
Bland--"that Tiberius Gracchus"--"in the name of the farmers of the
United States; in the name of the homeless wanderers who throng your
streets in quest of bread; in the name of that mighty army of the
unemployed; in the name of that mightier army which has risen in
insurrection against every form of despotism."

Mr. Bryan was presented as that young giant of the West, that friend of
the people, that champion of the lowly, that apostle and prophet of
this great crusade for financial reform--a new Cicero to meet the new
Catilines of to-day--to lead the Democratic party, the defender of the
poor, and the protector of the oppressed, which this day sent forth
"tidings of great joy to all the toiling millions of this overburdened
land."

On the first ballot, fourteen candidates were voted for, but Mr. Bland
and Mr. Bryan were clearly in the lead. On the fifth ballot, Mr. Bryan
was declared nominated by a vote of 652 out of 930. Throughout the
balloting, most of the eastern states abstained from voting. Ten
delegates from Connecticut, seventeen or eighteen from Massachusetts, a
majority from New Jersey, all of the delegates from New York, and a
majority of the delegates from Wisconsin refused to take any part at
all. Pennsylvania remained loyal throughout to the nominee from that
state, Pattison, although it was a forlorn hope. Thus in the balloting
for candidates, we discover the same alignment of the East against the
West and South which was evident in the vote on the platform. In the
vote on the Vice President which followed, the eastern states refused to
participate--from 250 to 260 delegates abstaining during the five
ballots which resulted in the nomination of Sewall. New York
consistently abstained; so did New Jersey; while a majority of the
delegates from Pennsylvania and Massachusetts refused to take part.

In the notification speech delivered by Mr. Stone at Madison Square
Garden in New York on August 12, the Democratic party was represented as
the champion of the masses and their leader as "a plain man of the
people." He defended the men of the Chicago convention against the
charge of being cranks, anarchists, and socialists, declaring them to be
the representatives of the industrial and producing classes who
constituted "the solid strength and safety of the state" against the
combined aggressions of foreign money changers and Anglicized American
millionaires--"English toadies and the pampered minions of corporate
rapacity." Against the selfish control of the privileged classes, he
placed the sovereignty of the people, declaring that within both of the
old parties there was a mighty struggle for supremacy between those who
stood for the sovereignty of the people and those who believed in "the
divinity of pelf." He took pride in the fact that the convention
represented "the masses of the people, the great industrial and
producing masses of the people. It represented the men who plow and
plant, who fatten herds, who toil in shops, who fell forests, and delve
in mines. But are these to be regarded with contumely and addressed in
terms of contempt? Why, sir, these are the men who feed and clothe the
nation; whose products make up the sum of our exports; who produce the
wealth of the republic; who bear the heaviest burdens in times of peace;
who are ready always to give their lifeblood for their country's
flag--in short, these are the men whose sturdy arms and faithful hands
uphold the stupendous fabric of our civilization."

Mr. Bryan's speech of acceptance was almost entirely devoted to a
discussion of the silver question. But he could not ignore the charge,
which had then become widespread throughout the country, that his party
meditated an attack upon the rights of property and was the foe of
social order and national honor. He repudiated the idea that his party
believed that equality of talents and wealth could be produced by human
institutions; he declared his belief in private property as the stimulus
to endeavor and compensation for toil; but he took his stand upon the
principle that all should be equal before the law. Among his foes he
discovered "those who find a pecuniary advantage in advocating the
doctrines of non-interference when great aggregations of wealth are
trespassing upon the rights of individuals." The government should
enforce the laws against all enemies of the public weal, not only the
highwayman who robs the unsuspecting traveler, but also the
transgressors who "through the more polite and less hazardous means of
legislation appropriate to their own use the proceeds of the toil of
others."

In his opinion, the Democratic income tax was not based upon hostility
to the rich, but was simply designed to apportion the burdens of
government more equitably among those who enjoyed its protection. As to
the matter of the Supreme Court, there was no suggestion in the platform
of a dispute with that tribunal. For a hundred years the Court had
upheld the underlying principle of the income tax, and twenty years
before "this same Court sustained without a dissenting voice an income
tax law almost identical with the one recently overthrown." The platform
did not propose an attack on the Supreme Court; some future Court had as
much right "to return to the judicial precedents of a century as the
present Court had to depart from them. When Courts allow rehearings
they admit that error is possible; the late decision against the income
tax was rendered by a majority of one after a rehearing."

Discussing the monetary question, Mr. Bryan confined his argument to a
few principles which he deemed fundamental. He disposed of international
bimetallism by questioning the good faith of those who advocated it and
declaring that there was an impassable gulf between a universal gold
standard and bimetallism, whether independent or international. He
rejected the proposition that any metal represented an absolutely just
standard of value, but he argued that bimetallism was better than
monometallism because it made a nearer approach to stability, honesty,
and justice than a gold standard possibly could. Any legislation
lessening the stock of standard money increased the purchasing power of
money and lowered the monetary value of all other forms of property. He
endeavored to show the advantages to be derived from bimetallism by
farmers, wage earners, and the professional classes, and asked whether
the mass of the people did not have the right to use the ballot to
protect themselves from the disastrous consequences of a rising
standard, particularly in view of the fact that the relatively few whose
wealth consisted largely in fixed investments had not hesitated to use
the ballot to enhance the value of their investments.

On the question of the ratio, sixteen to one, Mr. Bryan declared that,
because gold and silver were limited in the quantities then in hand and
in annual production, legislation could fix the ratio between them,
simply following the law of supply and demand. The charge of
repudiation he met with an argument in kind, declaring it to come "with
poor grace from those who are seeking to add to the weight of existing
debts by legislation which makes money dearer, and who conceal their
designs against the general welfare under the euphonious pretense that
they are upholding public credit and national honor." He concluded with
a warning to his hearers that they could not afford to join the money
changers in supporting a financial policy which destroyed the purchasing
power of the product of toil and ended with discouraging the creation of
wealth.

In a letter of acceptance of September 9, 1896, Mr. Bryan added little
to the speeches he had made in the convention and in accepting the
nomination. He attacked the bond policy of President Cleveland and
declared that to assert that "the government is dependent upon the good
will or assistance of any portion of the people other than a
constitutional majority is to assert that we have a government in form
but without vital force." Capital, he urged, was created by labor, and
"since the producers of wealth create the nation's prosperity in time of
peace and defend the nation's flag in time of peril, their interests
ought at all times to be considered by those who stand in official
positions." He criticized the abuses in injunction proceedings and
favored the principle of trial by jury in such cases. He declared that
it was not necessary to discuss the tariff at that time because the
money question was the overshadowing issue, and all minor matters must
be laid aside in favor of united action on that moot point.

A few of the advocates of the gold standard in the Democratic party, who
could not accept the Chicago platform and were yet unwilling to go over
to the Republicans, held a convention at Indianapolis in September, and
nominated a ticket, headed by John M. Palmer for President, and Simon
Buckner for Vice President. This party, through the address of its
executive committee calling the convention, declared that Democrats were
absolved from all obligations to support the Chicago platform because
the convention had departed from the recognized Democratic faith and had
announced doctrines which were "destructive of national honor and
private obligation and tend to create sectional and class distinctions
and engender discord and strife among the people." The address
repudiated the doctrine of majority rule in the party, declaring that
when a Democratic convention departed from the principles of the party,
no Democrat was under any moral obligation to support its action.

The principles of the party which, the address declared, had been
adhered to from Jefferson to Cleveland "without variableness or a shadow
of turning" were summed up in a policy of _laissez faire_. A true
Democrat, ran the address, "believes, and this is the cardinal doctrine
of his political faith, in the ability of every individual unassisted,
if unfettered by law, to achieve his own happiness, and therefore that
to every citizen there should be secured the right and opportunity
peaceably to pursue whatever course of conduct he would, provided such
conduct deprived no other individual of the equal enjoyment of the same
right and opportunity. He stood for freedom of speech, freedom of
conscience, freedom of trade, and freedom of contract, all of which are
implied by the century-old battle cry of the Democratic party
'Individual Liberty!' ... Every true Democrat ... profoundly disbelieves
in the ability of the government, through paternal legislation, or
supervision, to increase the happiness of the nation."

In the platform adopted at the convention, the "National Democratic
party" was pledged to the general principles enunciated in the address
and went on record as "opposed to all paternalism and all class
legislation." It declared that the Chicago convention had attacked
"individual freedom, the right of private contract, the independence of
the judiciary, and the authority of the President to enforce Federal
laws." It denounced protection and the free coinage of silver as two
schemes designed for the personal profit of the few at the expense of
the masses; it declared in favor of the gold standard, indorsed
President Cleveland's administration, and went to the support of the
Supreme Court by condemning "all efforts to degrade that tribunal or to
impair the confidence and respect which it has deservedly held."

This platform received the support of President Cleveland, who, in
response to an invitation to attend the meeting at which the candidates
were to be notified, said: "As a Democrat, devoted to the principles and
integrity of my party, I should be delighted to be present on an
occasion so significant and to mingle with those who are determined that
the voice of true Democracy shall not be smothered and who insist that
the glorious standard shall be borne aloft as of old in faithful
hands."

In their acceptance speeches, Palmer and Buckner devoted more attention
to condemning the Chicago platform than to explaining the principles for
which they stood. General Buckner said: "The Chicago Convention would
wipe virtually out of existence the Supreme Court which interprets the
law, forgetting that our ancestors in England fought for hundreds of
years to obtain a tribunal of justice which was free from executive
control. They would wipe that out of existence and subject it to the
control of party leaders to carry out the dictates of the party--they
would paralyze the arm of the general government and forbid the powers
to protect the lives and property of its citizens. That convention in
terms almost placed a lighted torch in the hands of the incendiary and
urged the mob to proceed without restraint to pillage and murder at
their discretion."


_The Campaign_

The campaign which followed the conventions was the most remarkable in
the long history of our quadrennial spectacles. Terror is always a
powerful instrument in politics, and it was never used with greater
effect than in the summer and autumn of 1896. Some of Mr. Bryan's
utterances, particularly on the income tax, frightened the rich into
believing, or pretending to believe, that his election would be the
beginning of a wholesale confiscation. The Republicans replied to Mr.
Bryan's threats by using the greatest of all terrors, the terror of
unemployment, with tremendous effect. Everywhere they let the country
understand that the defeat of Mr. McKinley would close factories and
throw thousands of workingmen out of employment, and manufacturers and
railways were accused by Mr. Bryan of exercising coercion on a large
scale.

To this terror from above, the Democrats responded by creating terror
below, by stirring deep-seated class feeling against the Republican
candidate and his managers. In a letter given out from the Democratic
headquarters in Chicago, on September 12, 1896, Mr. Jones, chairman of
the Democratic national committee, said: "Against the people in this
campaign are arrayed the consolidated forces of wealth and corporate
power. The classes which have grown fat by reason of Federal legislation
and the single gold standard have combined to fasten their fetters still
more firmly upon the people and are organizing every precinct of every
county of every state in the Union with this purpose in view. To meet
and defeat this corrupt and unholy alliance the people themselves must
organize and be organized.... It will minimize the effect of the
millions of dollars that are being used against us, and defeat those
influences which wealth and corporate power are endeavoring to use to
override the will of the people and corrupt the integrity of free
institutions."

Owing to the nature of the conflict enormous campaign funds were
secured. The silver miners helped to finance Mr. Bryan, but their
contributions were trivial compared with the immense sums raised by Mr.
Hanna from protected interests, bankers, and financiers. With this great
fund, speakers were employed by the thousands, newspapers were
subsidized, party literature circulated by the ton, whole states polled
in advance, and workers employed to carry the Republican fight into
every important precinct in the country. The God of battles was on the
side of the heaviest battalions. With all the most powerful engines for
creating public sentiment against him, Mr. Bryan, in spite of his
tremendous popular appeal, was doomed to defeat.

Undoubtedly, as was said at the time, most of the leading thinkers in
finance and politics were against Mr. Bryan, and if there is anything in
the verdict of history, the silver issue could not stand the test of
logic and understanding. But it must not be presumed that it was merely
a battle of wits, and that demagogic appeals to passions which were
supposed to be associated with Mr. Bryan's campaign were confined to his
partisans. On the contrary, the Republicans employed all of the forms of
personal vituperation. For example, that staid journal of Republicanism,
the _New York Tribune_, attributed the growth of Bryanism to the
"assiduous culture of the basest passions of the least worthy member of
the community.... Its nominal head was worthy of the cause. Nominal
because the wretched, rattle-pated boy, posing in vapid vanity and
mouthing resounding rottenness, was not the real leader of that league
of hell. He was only a puppet in the blood-imbued hands of Altgeld, the
anarchist, and Debs, the revolutionist, and other desperadoes of that
stripe. But he was a willing puppet, Bryan was,--willing and eager. None
of his masters was more apt than he at lies and forgeries and
blasphemies and all the nameless iniquities of that campaign against
the Ten Commandments." That such high talk by those who constituted
themselves the guardians of public credit, patriotism, and the Ten
Commandments was not calculated to sooth the angry passions of their
opponents needs no demonstration here.

       *       *       *       *       *

Argument, party organization and machinery, the lavish use of money, and
terror won the day for the Republicans. The solid East and Middle West
overwhelmed Mr. Bryan, giving Mr. McKinley 271 electoral votes and
7,111,607 popular votes, as against 176 electoral and 6,509,052 popular
votes cast for the Democratic candidate.

The decisive defeat of Mr. Bryan put an end to the silver issue for
practical purposes, although, as we shall see, it was again raised in
1900. The Republicans, however, delayed action for political reasons,
and it was not until almost four years had elapsed that they made the
gold dollar the standard by an act of Congress approved on March 4,
1900. Thus the war of the standards was closed, but the question of the
currency was not settled, and the old issue of inflation and contraction
continued to haunt the paths of the politicians. From time to time, the
prerogatives of the national banks, organized under the law of 1863
(modified in 1901), were questioned in political circles, and in 1908 an
attempt was made by act of Congress to give the currency more elasticity
by authorizing the banks to form associations and issue notes on the
basis of certain securities. Nevertheless, no serious changes were made
in the financial or banking systems before the close of the year 1912.
The attention of the country, shortly after the campaign of 1896, was
diverted to the spectacular events of the Spanish War, and for a time
appeals to patriotism subdued the passions of the radicals.

FOOTNOTES:

     [41] See below, p. 239.

     [42] H. Croly, _M. A. Hanna_, p. 195.




CHAPTER VIII

IMPERIALISM


The Republicans triumphed in 1896, but the large vote for Mr. Bryan and
his platform and the passions aroused by the campaign made it clear to
the far-sighted that, whatever might be the fate of free silver, new
social elements had entered American politics. It was fortunate for the
conservative interests that the quarrel with Spain came shortly after
Mr. McKinley's election, and they were able to employ that ancient
political device, "a vigorous foreign policy," to divert the public mind
from domestic difficulties. This was particularly acceptable to the
populace at the time, for there had been no war for more than thirty
years, and, contrary to their assertions on formal occasions, the
American people enjoy wars beyond measure, if the plain facts of history
are allowed to speak.[43]

Since 1876 there had been no very spectacular foreign affair to fix the
attention of the public mind, except the furor worked up over the
application of the Monroe Doctrine to Venezuela during President
Cleveland's second administration. For a long time that country and
Great Britain had been waging a contest over the western boundary of
British Guiana; and the United States, on the appeal of Venezuela, had
taken a slight interest in the dispute, generally assuming that the
merits of the case were on the side of the South American republic. In
1895, it became apparent that Great Britain did not intend to yield any
points in the case, and Venezuela began to clamor again for protection,
this time with effect. In July of that year, the Secretary of State,
Richard Olney, demanded that Great Britain answer whether she was
willing to arbitrate the question, and announced that the United States
was master in this hemisphere by saying: "The United States is
practically sovereign on this continent and its fiat is law upon the
subjects to which it confines its interposition. Why? It is not because
of the pure friendship or good will felt for it. It is not simply by
reason of its high character as a civilized state, nor because wisdom
and equity are the invariable characteristics of the dealings of the
United States. It is because in addition to all other grounds, its
infinite resources combined with its isolated position render it master
of the situation and practically invulnerable against any or all other
powers."

This extraordinary document, to put it mildly, failed to arouse the
warlike sentiment in England which its language invited, and Lord
Salisbury replied for the British government that this startling
extension of the Monroe Doctrine was not acceptable in the present
controversy and that the arbitration of the question could not be
admitted by his country. This moderate reply brought from President
Cleveland a message to Congress on December 17, 1895, which created in
the United States at least all the outward and visible signs of the
preliminaries to a war over the matter. He asked Congress to create a
commission to ascertain the true boundary between Venezuela and British
Guiana, and then added that it would be the duty of the United States
"to resist by every means in its power, as a wilful aggression upon its
rights and interests, the appropriation by Great Britain of any lands or
the exercise of governmental jurisdiction over any territory which,
after investigation, we have determined of right belongs to Venezuela."
He declared that he was conscious of the responsibilities which he thus
incurred, but intimated that war between Great Britain and the United
States, much as it was to be deplored, was not comparable to "a supine
submission to wrong and injustice and the consequent loss of national
self-respect and honor." In other words, we were to decide the dispute
ourselves and go to war on Great Britain if we found her in possession
of lands which in our opinion did not belong to her.

This defiant attitude on the part of President Cleveland, while it
aroused a wave of enthusiasm among those sections of the population
moved by bold talk about the unimpeachable integrity of the United
States and its daring defense of right everywhere, called forth no
little criticism in high places. Contrary to expectation, it was not met
by bluster on the part of Great Britain, but it was rather deplored
there as threatening a breach between the two countries over an
insignificant matter. Moreover, when the commission created by Congress
set to work on the boundary dispute, the British government courteously
replied favorably to a request for assistance in the search for
evidence. Finally, Great Britain yielded and agreed to the earlier
proposition on the part of the United States that the issue be
submitted to arbitration; and this happy outcome of the matter
contributed not a little to Mr. Cleveland's reputation as "a sterling
representative of the true American spirit." This was not diminished by
the later discovery that Great Britain was wholly right in her claims in
South America.

       *       *       *       *       *

The Venezuelan controversy was an echo of the time-honored Monroe
Doctrine and was without any deeper economic significance. There were
not wanting, however, signs that the United States was prepared
economically to accept that type of imperialism that had long been
dominant in British politics and had sprung into prominence in Germany,
France, and Italy during the generation following the Franco-Prussian
War. This newer imperialism does not rest primarily upon a desire for
more territory, but rather upon the necessity for markets in which to
sell manufactured goods and for opportunities to invest surplus
accumulations of capital. It begins in a search for trade, advances to
intervention on behalf of the interests involved, thence to
protectorates, and finally to annexation. By the inexorable necessity of
the present economic system, markets and safe investment opportunities
must be found for surplus products and accumulated capital. All the
older countries being overstocked and also forced into this new form of
international rivalry, the drift is inevitably in the direction of the
economically backward countries: Africa, Asia, Mexico, and South
America. Economic necessity thus overrides American isolation and
drives the United States into world politics.

Although the United States had not neglected the protection of its
interests from the days when it thrashed the Barbary pirates, sent Caleb
Cushing to demand an open door in China, and dispatched Commodore Perry
to batter down Japanese exclusiveness, the relative importance of its
world operations was slight until manufacturing and commerce gained
their ascendancy over agriculture.

The pressure of the newer interests on American foreign policy had
already been felt when the demand for the war with Spain came. In 1889,
the United States joined with Great Britain and Germany in a
protectorate over the Samoan Islands, thus departing, according to
Secretary Gresham, from our "traditional and well-established policy of
avoiding entangling alliances with foreign powers in relation to objects
remote from this hemisphere."[44] Preparations had been made under
Harrison's administration for the annexation of the Hawaiian Islands,
after a revolution, largely fomented by American interests there, had
overthrown the established government; but this movement was blocked for
the time being by President Cleveland, who learned through a special
commissioner, sent to investigate the affair, that the upheaval had been
due principally to American disgust for the weak and vacillating
government of the Queen. It was not until the middle of the Spanish War
that Congress, recognizing the importance of the Hawaiian Islands in
view of the probable developments resulting from Admiral Dewey's victory
in the Philippines, annexed them to the United States by joint
resolution on July 6, 1898.[45]


_The Spanish War_

It required, however, the Spanish War and the acquisition of the insular
dependencies to bring imperialism directly into politics as an
overshadowing issue and to secure the frank acknowledgment of the new
emphasis on world policy which economic interests demanded. It is true
that Cuba had long been an object of solicitude on the part of the
United States. Before the Civil War, the slave power was anxious to
secure its annexation as a state to help offset the growing predominance
of the North; and during the ten years' insurrection from 1868 to 1878,
when a cruel guerilla warfare made all life and property in Cuba unsafe,
intervention was again suggested. But it was not until the renewal of
the insurrection in 1895 that American economic interests in Cuba were
strong enough to induce interference. Slavery was gone, but capital,
still more dominant, had taken its place.

In 1895, Americans had more than fifty million dollars invested in Cuban
business, and our commerce with the Island had risen to one hundred
millions annually. The effect of the Cuban revolt against Spain was not
only to diminish trade, but also to destroy American property. The
contest between the rebels and Spanish troops was characterized by
extreme cruelty and a total disregard for life and property. Gomez, the
leader of the revolt, resorted to the policy made famous by Sherman on
his march to the sea. He laid waste the land to starve the Spaniards and
compel American interference if possible. By a proclamation of November
6, 1895, he ordered that plantation buildings and railway connections
should be destroyed and sugar factories closed everywhere; what he left
undone was finished by the Spanish general, Weyler, who concentrated the
inhabitants of the rural districts in the centers occupied by the
troops. Under such a policy, business was simply paralyzed; and within
less than two years Americans had filed against Spain claims amounting
to sixteen million dollars for property destroyed in the revolution.

The atrocities connected with the insurrection attracted the sympathy of
the American people at once. Sermons were preached against Spanish
barbarism; orators demanded that the Cuban people be "succored in their
heroic struggle for the rights of men and of citizens"; Mr. Hearst's
newspapers appealed daily to the people to compel governmental action at
once, and denounced the tedious methods of negotiation, in view of an
inevitable war. Cuban juntas formed in American cities raised money and
supplied arms for the insurrectionists. All the enormous American
property interests at stake in the Island, with their widespread and
influential ramifications in the United States, demanded action. The
war fever, always quick to be kindled, rose all over the country.

Even amid the exciting campaign of 1896, the Democrats found time to
express sympathy with the Cubans, and the Republicans significantly
remarked that inasmuch as Spain was "unable to protect the property or
lives of resident American citizens," the good offices of the United
States should be tendered with a view to pacification and independence.
Perhaps, not unaware of the impending crisis, the Republicans also
favored a continued enlargement of the navy to help maintain the
"rightful influence" of the United States among the nations of the
earth.

President Cleveland, repudiated by his own party and having no desire to
"play the game of politics," assumed an attitude of neutrality in the
conflict and denied to the Cubans the rights of belligerents. He offered
to Spain the good offices of the United States in mediation with the
insurgents--a tender which was rejected by Spain with the suggestion
that the United States might more vigorously suppress the unlawful
assistance which some of its citizens were lending to the
revolutionists. Mr. Cleveland's second administration closed without any
positive action on the Cuban question.

Within four months after his inauguration, President McKinley protested
strongly to Spain against her policy in Cuba, and during the summer and
autumn and winter he conducted a running fire of negotiations with
Spain. Congress was impatient for armed intervention and fretted at the
tedious methods of diplomacy. Spain shrewdly made counter thrusts to
every demand advanced by the United States, but made no outward sign of
improvement in the affairs of Cuba, even after the recall of General
Weyler. In February, 1898, a private letter, written by De Lome, the
Spanish minister at Washington, showing contempt for Mr. McKinley and
some shifty ideas of diplomacy, was acquired by the _New York Journal_
and published. This stirred the country and led to the recall of the
minister by his home government. Meanwhile the battleship _Maine_ was
sent to Havana, officially to resume friendly relations at Cuban ports,
but not without an ulterior regard for the necessity of protecting the
lives and property of Americans in jeopardy. The incident of the Spanish
minister's letter had hardly been closed before the _Maine_ was blown up
and sunk on the evening of February 15, 1898. The death of two officers
and two hundred and fifty-eight of the crew was a tragedy which moved
the nation beyond measure, and with the cry "Remember the _Maine_"
public opinion was worked up to a point of frenzy.

A commission was appointed at once to inquire into the cause of the
disaster, and on March 21 it reported that the _Maine_ had been
destroyed by an explosion of a submarine mine which set off some of the
ship's magazines. Within a week, negotiations with Spain were resumed,
and that country made generous promises to restore peace in the Island
and permit a Cuban parliament to be established in the interests of
local autonomy. None of Spain's promises were regarded as satisfactory
by the administration, and on April 4, General Woodford, the American
representative in that country, was instructed to warn the ministry that
no effective armistice had been offered the Cubans and that President
McKinley would shortly lay the matter before Congress--which meant war.
After some delay, during which representatives of the European powers
and the Pope were at work in the interests of peace, Spain promised to
suspend hostilities, call a Cuban parliament, and restore a reasonable
autonomy.

On the day after the receipt of this promise, President McKinley sent
his war message to Congress without explaining fully the latest
concessions made by Spain. It was claimed by the Spanish government that
it had yielded absolutely everything short of independence and that all
of the demands of the United States had been met. Some eminent editors
and publicists in the United States have since accepted this view of the
affair and sharply criticized the President for not making public the
full text of Spain's last concession on the day that he sent his war
message to Congress. Those who take this view hold that President
McKinley believed war to be inevitable and desirable all along, but
merely wished to bring public opinion to the breaking point before
shifting the responsibility to Congress. The President's defenders,
however, claim that no credence could be placed in the good faith of
Spain and that the intolerable conditions in Cuba would never have been
removed under Spanish administration, no matter what promises might have
been made.

In his war message of April 11, 1898, Mr. McKinley brought under review
the conditions in Cuba and the history of the controversy, coming to
the conclusion that the dictates of humanity, the necessity of
protecting American lives and property in Cuba, and the chronic
disorders in the Island warranted armed intervention. Congress responded
by an overwhelming vote on April 19, in favor of a resolution declaring
that Cuba should be free, that Spain's withdrawal should be demanded,
and the President be authorized to use the military and naval forces of
the country to carry the decree into effect. In the enthusiasm of the
hour, Congress also specifically disclaimed any intention of exercising
"sovereignty, jurisdiction, or control over said Island except for the
pacification thereof." Thus war was declared on the anniversary of the
battle of Lexington.

In the armed conflict which followed, the most striking and effective
operations were on the sea. In anticipation of the war, Commodore Dewey,
in command of the Asiatic station, had been instructed as early as
February to keep his squadron at Hongkong, coaled, and ready, in event
of a declaration of hostilities, to begin offensive operations in the
Philippine Islands. The battleship _Oregon_, then off the coast of
Washington, was ordered to make the long voyage around the Horn, which
has now become famous in the annals of the sea. At the outbreak of the
war, Rear Admiral Sampson, in charge of the main squadron at Key West,
was instructed to blockade important stretches of the coast of Cuba and
to keep watch for the arrival of the Spanish fleet, under Admiral
Cervera, which was then on the high seas, presumably bound for Cuba.

The first naval blow was struck by Admiral Dewey, who had left Chinese
waters on receiving news of the declaration of war and had reached
Manila Bay on the evening of April 30. Early the following morning he
opened fire on the inferior Spanish fleet under the guns of Cavite and
Manila, and within a few hours he had destroyed the enemy's ships,
killed nearly four hundred men, and silenced the shore batteries without
sustaining the loss of a single man or suffering any injuries to his own
ships worthy of mention. News of this extraordinary exploit reached the
United States by way of Hongkong on May 6, and the hero of the day was,
by popular acclaim, placed among the immortals of our naval history.

While celebrating the victory off Manila, the government was anxiously
awaiting the arrival of the Spanish fleet in American waters which were
being carefully patrolled. In spite of the precautions of Admiral
Sampson, Cervera was able to slip into the harbor of Santiago on May 19,
where he was immediately blockaded by the American naval forces. An
attempt was made to stop up the mouth of the harbor by sending
Lieutenant Richmond P. Hobson to sink a collier at the narrow entrance,
but this spectacular move, carried out under a galling fire, failed to
accomplish the purpose of the projectors, and Hobson and his men fell
into the hands of the Spaniards.

The time had now come for bringing the land forces into cooperation with
the navy for a combined attack on Santiago, and on June 14 a large body
of troops, principally regulars, embarked from Tampa, where men and
supplies had been concentrating for weeks. The management of the army
was in every respect inferior to the administration of the navy.
Secretary Alger, of the War Department, was a politician of the old
school, who could not allow efficiency to interfere with the "proper"
distribution of patronage; and as a result of his dilatory methods (to
put it mildly) and the general unpreparedness of the army, the camp at
Tampa was grossly mismanaged. Sanitary conveniences were indescribably
bad, supply contractors sold decayed meat and wretched food to the
government, heavy winter clothing was furnished to men about to fight in
the summer time in a tropical climate, and, to cap the climax of
blundering, inadequate provisions were made for landing the troops when
they reached Cuba on June 22.

The forces dispatched to Cuba were placed under the command of General
Shafter, but owing to his illness the fighting was principally carried
on under Generals Lawton and Wheeler. The most serious conflicts in the
land campaign occurred at El Caney and San Juan Hill, both strategic
points near Santiago. At the second of these places the famous "Rough
Riders" under Colonel Roosevelt distinguished themselves by a charge up
the hill under heavy fire and by being the first to reach the enemy's
intrenchments. In spite of several engagements, in which the fortunes of
the day were generally on the side of the Americans, sickness among the
soldiers and lack of supplies caused General Shafter to cable, on July
3, that without additional support he could not undertake a successful
storming of Santiago.

At this critical juncture, the naval forces once more distinguished
themselves, and made further bloody fighting on land unnecessary, by
destroying Cervera's fleet which attempted to make its escape from the
Santiago harbor on the morning of July 3. The American ships were then
in charge of Commodore Schley, for Admiral Sampson had left watch early
that morning for a conference with General Shafter; and the sailors
acquitted themselves with the same skill that marked Dewey's victory at
Manila. Within less than four hours' fighting all the Spanish ships were
destroyed or captured with a loss of about six hundred killed and
wounded, while the Americans sustained a loss of only one man killed and
one wounded. This victory, of course, marked the doom of Santiago,
although it did not surrender formally until July 17, after two days'
bombardment by the American ships.

The fall of Santiago ended military operations in Cuba, and General
Miles, who had come to the front in time to assist General Shafter in
arranging the terms of the surrender of Santiago, proceeded at once to
Porto Rico. He was rapidly gaining possession of that Island in an
almost bloodless campaign when news came of the signing of the peace
protocol on August 12. Unfortunately it required longer to convey the
information to the Philippines that the war was at an end, and on the
day after the signature of the protocol, that is, August 13, General
Merritt and Admiral Dewey carried Manila by storm.

As early as July 26, 1898, the Spanish government approached President
McKinley through M. Cambon, the French ambassador at Washington, and
asked for a preliminary statement of the terms on which the war could
be brought to a close. After some skirmishing, in which Spain
reluctantly yielded to the American ultimatum, a peace protocol was
signed on August 12, to the effect that Cuba should be independent,
Porto Rico ceded to the United States, and Manila occupied pending the
final negotiations, which were opened at Paris by special commissioners
on October 1.

When the commissioners met according to arrangements, the government of
the United States apparently had not come to a conclusion as to the
final disposition of the Philippines. The administration was anxious not
to go too far in advance of public opinion, at least so far as official
pronunciamento was concerned, although powerful commercial interests
were busy impressing the public mind with the advantages to be derived
from the retention of the distant Pacific Islands. In his instructions
to the peace commissioners, on the eve of their departure, Mr. McKinley,
while denying that there had originally been any intention of conquest
in the Pacific, declared that the march of events had imposed new duties
upon us, and added: "Incidental to our tenure in the Philippines is the
commercial opportunity to which American statesmanship cannot be
indifferent. It is just to use every legitimate means for the
enlargement of American trade." While stating that the possession of
territory was less important than an "open door" for trade purposes, he
concluded by instructing the commissioners that the United States could
not "accept less than the cession in full right and sovereignty of the
Island of Luzon."

The peace commissioners were divided among themselves as to the policy
to be pursued with regard to the Philippines; but in the latter part of
October they received definite instructions from the Secretary of State,
Mr. John Hay, that the cession of Luzon alone could not be justified "on
political, commercial, or humanitarian grounds," and that the entire
archipelago must be surrendered by Spain. The Spanish commissioners
protested vigorously against this demand, on the theory that it was
outside of the terms of the peace protocol, but they were forced to
yield, receiving as a sort of consolation prize the payment of twenty
million dollars in compensation for the loss.

The final treaty, as signed on December 10, 1898, embodied the following
terms: the independence of Cuba, the cession of Porto Rico, Guam, and
the Philippines to the United States, the cancellation of the claims of
the citizens of the two countries against each other, the United States
undertaking to settle the claims of its citizens against Spain, the
payment of twenty million dollars for the Philippines by the United
States, and the determination of the civil and political status of the
inhabitants of the ceded territories by Congress.

When the treaty of peace was published, the contest over the retention
of the Philippines took on new bitterness--at least in public speeches
and editorials. The contentions on both sides were so vehement that it
was almost impossible to secure any frank discussion of the main issue:
"Does the United States want a foothold in the Pacific in order to
secure the trade of the Philippines and afford American capital an
opportunity to develop the dormant natural resources, and in order also
to have a station from which to give American trade and capital a better
chance in the awakening Orient?" Democrats demanded self-government for
the Philippines, "in recognition of the principles of the immortal
Declaration of Independence." Republicans talked in lofty strains about
"the mysterious hand of Providence which laid this burden upon the
Anglo-Saxon race."

The proposal to retain the Philippines, in fact, gave the southern
statesmen just the opportunity they had long wanted to taunt the
Republicans with insincerity on the race question. "Republican leaders,"
said Senator Tillman, "do not longer dare to call into question the
justice or necessity of limiting negro suffrage in the South." And on
another occasion he exclaimed in querulous accents: "I want to call your
attention to the remarkable change that has come over the spirit of the
dream of the Republicans. Your slogans of the past--brotherhood of man
and fatherhood of God--have gone glimmering down through the ages. The
brotherhood of man exists no longer." To such assertions, Republicans of
the old school, like Senator Hoar, opposed to imperialism, replied
sadly, "The statements of Mr. Tillman have never been challenged and
never can be." But Republicans of the new school, unvexed by charges of
inconsistency, replied that high talk about the rights of man and of
self-government came with poor grace from southern Democrats who had
disfranchised millions of negroes that were just as capable of
self-government as the bulk of the natives in the Philippines.

Senator Vest, on December 6, introduced in the Senate a resolution to
the effect "that under the Constitution of the United States, no power
is given to the Federal Government to acquire territory to be held and
governed permanently as colonies." He was ably supported by Senator
Hoar, from Massachusetts, who took his stand upon the proposition that
"governments derive their just powers from the consent of the governed."
On the other side, Senator O. H. Platt, of Connecticut, expounded the
gospel of manifest destiny: "Every expansion of our territory has been
in accordance with the irresistible law of growth. We could no more
resist the successive expansions by which we have grown to be the
strongest nation on earth than a tree can resist its growth. The history
of territorial expansion is the history of our nation's progress and
glory. It is a matter to be proud of, not to lament. We should rejoice
that Providence has given us the opportunity to extend our influence,
our institutions, and our civilization into regions hitherto closed to
us, rather than contrive how we can thwart its designs."

At length on February 6, 1899, the treaty was ratified by the Senate,
but it must not be assumed that all of the Senators who voted for the
ratification of the treaty favored embarking upon a policy of
"imperialism." Indeed, at the time of the approval of the treaty, a
resolution was passed by the Senate to the effect that the policy to be
adopted in the Philippines was still an open question; but the outbreak
of an insurrection there led to an immediate employment of military rule
in the Islands and criticism was silenced by the cry that our national
honor was at stake.

The revolt against American dominion might have been foreseen, for the
conduct of Generals Anderson and Merritt at Manila had invited trouble.
For a long time before the War, native Filipinos had openly resisted
Spanish rule, and particularly the dominance of the monks and priests,
who held an enormous amount of land and managed civil as well as
ecclesiastical affairs. Just before the outbreak of the Spanish War,
there had been a revolt under the leadership of Aguinaldo which had been
brought to an end by the promise to pay a large sum to the revolutionary
leaders and to introduce extensive administrative reforms. The promises,
however, had not been carried out, and Admiral Dewey had invited the
cooperation of Aguinaldo and his insurgents in the attack on Manila.
When the land assault was made on the city, in August, Aguinaldo joined
with a large insurgent army under the banner of the Filipino republic
which had been proclaimed in July, but he was compelled to take a
subordinate position, and received scant respect from the American
commanders, who gave him to understand that he had no status in the war
or the settlement of the terms of capitulation.

As may be imagined, Aguinaldo was in no happy frame of mind when the
news came in January, 1899, that the United States had assumed
sovereignty over the islands; but it is not clear that some satisfactory
adjustment might not have been made then, if the United States had been
willing to accept a sort of protectorate and allow the revolutionaries
to establish a local government of their own. However, little or nothing
was done to reach a peaceful adjustment, and on February 4, some
Filipino soldiers were shot by American troops for refusing to obey an
order to halt, on approaching the American lines. This untoward incident
precipitated the conflict which began with some serious regular fighting
and dwindled into a vexatious guerilla warfare, lasting three years and
costing the United States heavily in men and money. Inhuman atrocities
were committed on both sides, resembling in brutality the cruel deeds
which had marked frontier warfare with the Indians. Reports of these
gruesome barbarities reached the United States and aroused the most
severe criticism of the administration, not only from the opponents of
imperialism, but also from those supporters of the policy, who imagined
that it could be carried out with rose water.

       *       *       *       *       *

The acquisition of the insular dependencies raised again the old problem
as to the power of Congress over territories, which had been so
extensively debated during the slavery conflict. The question now took
the form: "Does the Constitution restrict Congress in the government of
the Islands as if they were physically and politically a part of the
United States, and particularly, do the limitations in behalf of private
rights, freedom of press, trial by jury, and the like, embodied in the
first ten Amendments, control the power of Congress?" Strict
constitutionalists answered this question in the affirmative without
hesitation, citing the long line of constitutional decisions which had
repeatedly affirmed the doctrine that Congress is limited everywhere,
even in the territories by the Amendments providing for the protection
of personal and property rights; but practical politicians, supporting
the McKinley administration, frankly asserted that the Constitution and
laws of the United States did not of their own force apply in the
territories and could not apply until Congress had expressly extended
them to the insular possessions.

The abstract question was given concrete form in several decisions by
the Supreme Court, known as "the Insular Cases." The question was
speedily raised whether importers of commodities from Porto Rico should
be compelled to pay the duties prescribed by the Dingley act, and the
Court answered in the case of De Lima _v._ Bidwell in 1901 that the
Island was "domestic" within the meaning of the tariff act and that the
duties could not be collected. In the course of his remarks, the
Justice, who wrote the opinion, said that territory was either domestic
or foreign, and that the Constitution did not recognize any halfway
position. Four Justices dissented, however; and American interests,
fearing this new competition, had dissented in advance,--so vigorously,
in fact, that Congress during the previous year had passed the Foraker
act imposing a tariff on goods coming into the United States from Porto
Rico and _vice versa_.

This concession to the protected interests placed the Supreme Court in a
dilemma. If Porto Rico was domestic territory,--a part of the United
States,--was not the Foraker act a violation of the constitutional
provision that duties, imposts, and excises shall be uniform throughout
the United States? This question was judicially answered by the Court
in the case of Downes _v._ Bidwell, decided on May 27, 1901, which
upheld the Foraker act on grounds so various that the only real point
made by the Court was that the law was constitutional. None of the four
justices who concurred with Justice Brown in the opinion agreed with his
reasoning, and the four judges, who dissented entirely from the decision
and the opinion, vigorously denied that there could be any territory
under the flag of the United States which was not subject to the
limitations of the Constitution.

In other cases involving freedom of the press in the Philippines and
trial by jury in the Hawaiian Islands, the Supreme Court upheld the
doctrine that Congress, in legislating for the new dependencies, was not
bound by all those constitutional limitations which had been hitherto
applied in the continental territories of the United States. The upshot
of all these insular decisions is that the Constitution may be divided
into two parts, "fundamental" and "formal"; that only the fundamental
parts control the Federal authorities in the government of the
dependencies; and that the Supreme Court will decide, from time to time
as specific cases arise, what parts of the Federal Constitution are
"fundamental" and what parts are merely "formal." In two cases, the
Court has gone so far as to hold that indictment by grand jury and trial
by petit jury with unanimous verdict are not "fundamental" parts of the
Constitution, "but merely concern a method of procedure." In other
words, the practical necessities of governing subject races of different
origins and legal traditions forced that eminent tribunal to resort to
painful reasoning in an effort not to hamper unduly the power of
Congress by constitutional limitations.

       *       *       *       *       *

In the settlement which followed the Spanish War, three general problems
were presented. In the first place, our relations to Cuba required
definition. It is true that in the declaration of war on Spain Congress
had disclaimed "any disposition or intention to exercise sovereignty,
jurisdiction, or control over said Island except for the pacification
thereof, and asserts its determination when that is accomplished to
leave the government and control of the Island to its people"; but
American economic interests in the Island were too great to admit of the
actual fulfillment of this promise. Consequently, Cuba was forced to
accept, as a part of her constitution, several provisions, known as the
Platt amendment, adopted by the Congress of the United States on March
2, 1901, restricting her relations with foreign countries, limiting her
debt-creating power, securing the right of the United States to
intervene whenever necessary to protect life and property, and reserving
to the United States the right to acquire coaling stations at certain
points on the Island to be agreed upon.

Under the constitution, to which the Platt reservations on behalf of the
United States were attached, the Cubans held a general election in
December, 1901, choosing a president and legislature; and in the spring
of the following year American troops were withdrawn, leaving the
administration in the hands of the natives. It was not long, however,
before domestic difficulties began to disturb the peace of the Island,
and in the summer of 1906 it was reported that the government of
President Palma was about to be overthrown by an insurrection. Under the
circumstances, Palma resigned, and the Cuban congress was unable to
secure a quorum for the transaction of business. After due warning,
President Roosevelt intervened, under the provisions of the Platt
amendment, and instituted a temporary government supported by American
troops. American occupation of the Island continued for a few months,
but finally the soldiers were withdrawn and native government was once
more put on trial.

The second problem was presented by Porto Rico, where military rule was
put into force after the occupation in 1898. At length, on May 1, 1900,
an "organic act," instituting civil government in that Island, was
approved by the President. This law did not confer citizenship on the
Porto Ricans, but assured them of the protection of the United States.
It set up a government embracing a governor, appointed by the President
and Senate of the United States, six executive secretaries appointed in
the same manner as the governor, and a legislature of two houses--one
composed of the six secretaries and five other persons selected by the
President and Senate, acting as the upper house, and a lower house
elected by popular vote. Under this act, the practice of appointing
Americans to the chief executive offices took the final control of
legislative matters out of the hands of the natives, leaving them only
an initiatory power. This produced a friction between the appointive
and elective branches of the government, which became so troublesome
that the dispute had to be carried to Washington in 1909, and Congress
enacted a measure providing that, in case the lower house of the Porto
Rican legislature refused to pass the budget, the financial arrangements
of the previous year should continue.

The problem of governing the Philippines was infinitely more complicated
than that of governing Porto Rico, because the archipelago embraced more
than three thousand islands and about thirty different tribes and
dialects. The evolution of American control there falls into three
stages. At first, they were governed by the President of the United
States under his military authority. In 1901, a civil commission, with
Mr. W. H. Taft at the head, took over the civil administration of all
the pacified provinces. In 1902, Congress passed an "organic act" for
the Islands, providing that, after their pacification, a legislative
assembly should be erected. At length, in 1907, this assembly was duly
instituted, and the government now consists of the governor, a
commission appointed by the President and Senate, and a legislature
composed of the commission and a lower house of representatives elected
by popular vote.

       *       *       *       *       *

Important as are the problems of governing dependencies, they are not
the sole or even the most significant aspects of imperialism. The
possession of territories gives a larger control over the development of
their trade and resources; but capital and enterprise seeking an outlet
flow to those countries where the advantages offered are the greatest,
no matter whoever may exercise political dominion there. The acquisition
of the Philippines was simply an episode in the development of American
commercial interests in the Orient.

It was those interests which led the United States to send Caleb Cushing
to China in 1844 to negotiate a treaty with that country securing for
Americans rights of trade in the ports which had recently been blown
open by British guns in the famous "Opium War." It was those interests
which induced the United States government to send Commodore Perry to
Japan in 1853 and led to the opening of that nation--long closed to the
outside world--to American trade and enterprise. After 1844 in China,
and 1854 in Japan, American trade steadily increased, and American
capital seeking investments soon began to flow into Chinese business and
railway undertakings. Although the United States did not attempt to
follow the example of Great Britain, Russia, France, and Germany in
seizing Chinese territory, it did obtain a sufficient economic interest
in that Empire to warrant the employment of American soldiers in
cooperation with Russian, English, French, Japanese, and other
contingents at the time of the Boxer insurrection at Peking in the
summer of 1900.

The policy of the United States at the time won no little praise from
the Chinese government. Having no territorial ambitions in the Empire,
the administration at Washington, through Mr. John Hay, Secretary of
State, was able to announce that the United States favored an "open
door" for trade and the maintenance of the territorial integrity of
China. "The policy of the Government of the United States," said Mr. Hay
to the Powers, in the summer of 1900, "is to seek a solution which may
bring about permanent safety and peace to China, preserve Chinese
territorial and administrative entity, protect all rights guaranteed to
friendly powers by treaty and international law, and safeguard for the
world the principle of equal and impartial trade with all parts of the
Chinese empire." This friendly word, which was much appreciated by
China, was later supplemented by the generous action of the United
States government in returning to that country a large sum of money
which had been collected as an indemnity for the injury to American
rights in the Boxer uprising, and was discovered to be an overcharge due
to excessive American claims.

While thus developing American interests in the Orient, the United
States government was much embarrassed by the legislation of some of the
western states against Orientals. Chinese and Japanese laborers were
excluded from the country by law or agreements, but in spite of this
fact there were large numbers of Orientals on the coast. This was
resented by many whites, particularly trade unionists with whom the
cheap labor came into competition, and from time to time laws were
enacted by state legislatures that were alleged to violate the rights
which the United States had guaranteed to the Chinese or Japanese by
treaties with their respective countries.

Such a dispute occurred a few years ago over an attempt to exclude
Japanese children from the regular public schools in San Francisco, and
again in 1912 in connection with a law of California relative to the
acquisition of lands by aliens--the naturalization of Orientals being
forbidden by Federal law. These legal disputes arose from the fact that
the Federal government has the power to make treaties with foreign
countries relative to matters which are entirely within the control of
state legislatures. The discriminations against the Orientals, coupled
with the pressure of American interests in the Far East and the presence
of American dominion in the Philippines, caused no little friction
between certain sections of the United States and of Japan; and there
were some who began, shortly after the Spanish War, to speak of the
"impending conflict" in the Orient.


_The Campaign of 1900_

It was inevitable that the new issues, raised by the Spanish War, the
acquisition of the insular possessions, and the insurrection against
American rule in the Philippines, should find their way almost
immediately into national politics. By the logic of their situation, the
Republicans were compelled to defend their imperialist policy, although
it was distasteful to many of the old leaders; and at their national
convention, at Philadelphia in June, 1900, they renominated President
McKinley by acclamation, justified their methods in the dependencies,
approved the new commercial advances in the Orient, advocated government
aid to the merchant marine, and commended the acquisition of the
Hawaiian Islands. The trust plank, couched in vague and uncertain terms,
was, interestingly enough, drafted by Mr. Hanna, who appropriately
levied the campaign collections for his party in Wall Street.[46] Mr.
Roosevelt, then governor of New York, was nominated for Vice President,
although he had refused to agree to accept the office. The desire of
Senator Platt, the Republican "boss" in New York, to put him out of the
state threw the "machine" in his favor, and this, combined with
enthusiasm for him in the West, gave him every vote in the convention
save his own. Under the circumstances he was forced to accept the
nomination.

The Democrats took up the challenge on "imperialism"; but Mr. Bryan was
determined not to allow the silver question to sink into an early grave,
and he accordingly forced the adoption of a free silver plank, as the
price of his accepting the nomination. The platform was strong in its
denunciation of Republican "imperialist" policy, in general and in
detail. It favored promising the Filipinos stable government,
independence, and, finally, protection from outside interference. It was
also more positive on the trust question, and it advocated an increase
in the powers of the interstate commerce commission, enabling it "to
protect individuals and communities from discriminations and the people
from unjust and unfair transportation rates." An effort was made to
placate the conservative section of the party by offering the nomination
to the Vice Presidency to David B. Hill, of New York, and on his
refusal of the honor it was given to Adlai Stevenson, who had held that
office during Cleveland's second administration.

Although many Republicans supported Mr. Bryan on account of their
dislike of imperialism and its works, the result of the campaign was a
second victory for Mr. McKinley, even greater than that of 1896. He
received a larger popular vote and Mr. Bryan a smaller vote than in that
year. Of the 447 electors, Mr. McKinley received 292. This happy outcome
he naturally regarded as a vindication of his policies, and he was
evidently turning toward the future with renewed confidence (as his
Buffalo speech on reciprocity indicated) when on September 6, 1901, he
was shot by an anarchist at the Buffalo exposition and died eight days
later.

Mr. Roosevelt immediately took the oath of office, and promised to
continue "absolutely unbroken" the policy of his predecessor.

FOOTNOTES:

     [43] J. B. Moore, _Four Phases of American Development_, p.
     195.

     [44] In 1899, the tripartite arrangement was dissolved and
     the United States obtained outright possession of Tutuila.

     [45] The Hawaiian Islands are ruled by a governor appointed
     by the President and Senate and by a legislature of two
     houses elected by popular vote.

     [46] Croly, _Life of Marcus Hanna_, p. 307.




CHAPTER IX

THE DEVELOPMENT OF CAPITALISM


The years immediately following the War with Spain were marked by
extraordinary prosperity in business. The country recovered from the
collapse of the nineties and entered with full swing into another era of
inflation and promotion. The Dingley tariff law, enacted July 24, 1897,
had incidentally aided in the process by raising the protection
principle to its highest point since the Civil War, but the causes of
the upward movement lay deeper. The Spanish War, of course, stimulated
trade, for destruction on such a large scale always creates a heavy
demand for commodities and capital--a demand which was partially met, as
usual, by huge drafts on the future in the form of an increased national
debt. But the real cause lay in the nature of the economic processes
which had produced the periodical cycles of inflation and collapse
during the nineteenth century. Having recovered from a collapse previous
to the War, inflation and capitalization on a gigantic scale set in and
did not run their course until a debacle in 1907.

The formation of trusts and the consolidation of older combinations in
this period were commensurate in scale with the gigantic financial power
created by capitalist accumulations. The period of the later seventies
and eighties, as has been shown, was a period of hot competition
followed by pools, combinations, and trusts. The era which followed the
Spanish War differed in degree rather than in kind, but it was marked by
financial operations on a scale which would have staggered earlier
promoters. Perhaps it would be best to say that the older school merely
found its real strength at the close of the century, for the new
financing was done by the Vanderbilt, Astor, Gould, Morgan, and
Rockefeller interests, the basis of which had been laid earlier. There
was, in fact, no break in the process, save that which was made by the
contraction of the early nineties. But the operations of the new era
were truly grand in their conception and execution.

A few examples will serve to illustrate the process. In 1900, the
National Sugar Refining Company of New Jersey was formed with a capital
of $90,000,000, and "from its inception it adopted the policy of issuing
no public statements to its stockholders regarding earnings or financial
conditions. The only statement ... is simply an annual balance sheet,
showing the assets and liabilities of the corporation in a greatly
condensed form." In 1904, the total capital of parent and affiliated
concerns was approximately $145,000,000. The Copper Trust was
incorporated under New Jersey laws in 1899, and in 1904 its par value
capital was $175,000,000. In 1899, the Smelters' Trust with an
authorized capital of about $65,000,000 was formed. In the same year the
Standard Oil Company, as the successor to the Trust, was organized with
$102,233,700 capital.

The process of consolidation may best be shown by turning from
generalities to a brief study of the United States Steel Corporation, a
great portion of whose business was laid bare in 1911-12 by a Federal
investigation. It appears that until about 1898 there was a large number
of steel concerns actively engaged in a competition which was modified
at times by pools and price agreements; and that each of them was
vigorously reaching out, not only for more trade, but for control over
the chief source of strength--supply of ore. Finally, in the closing
days of the nineties, this competition and stress for control became so
great that the steel men and the associated financial interests began to
fear that the increased facilities for production would result in
flooding the market and in ruining a number of concerns. The rough steel
manufacturers began to push into the field of finished products, and the
wire, nail, plate, and tube concerns were crowding into the rough steel
manufacturing. All were scrambling for ore beds. In this "struggle of
the giants" the leading steel makers saw nothing but disaster, and they
set to work to consolidate a dozen or more companies. Their labors were
crowned with success on April 1, 1901, when the new corporation with a
capital of a little more than $1,400,000,000 began business.

In the consolidation of the several concerns an increase of more than
$400,000,000 was made in the total capital; and a stock commission of
the cash value of $62,500,000 was given to the Morgan underwriting
syndicate for financing the enterprise. It is, of course, impossible to
discover now the physical value of the properties consolidated, many of
which were already heavily "watered." Of the Carnegie concern, a Federal
report says, "The evidence on the whole tends to show that bonds were
issued substantially up to the full amount of the physical assets
acquired and that the stock was issued merely against good will and
other intangible considerations." How much of the total capital was
"water" is impossible to determine, but the Bureau of Corporations
estimates "that more than $150,000,000 of the stock of the Steel
Corporation (this including more than $41,000,000 of preferred stock and
$109,000,000 of common stock) was issued, either directly or indirectly
(through exchange) for mere promotion or underwriting services. This
total, moreover, as noted does not include anything for the American
Sheet Steel Company ... nor is anything added in the case of the Shelby
Steel Tube Company. It should be repeated that this enormous total of
over $150,000,000 does not include common stock issued as bonus with
preferred for property or for cash, but simply what may be termed the
promotion and organization commissions in the strict sense. In other
words, nearly one seventh of the total capital stock of the Steel
Corporation appears to have been issued, either directly or indirectly,
to promoters for their services." How much more of the $440,000,000
additional capital represented something other than physical values is
partially a matter of guesswork. The Bureau of Corporations valued the
tangible property of the corporation at $682,000,000 in 1901, as against
$1,400,000,000 issued securities; and computed the rate of profit from
1901 to 1910 on the actual investment at 12 per cent. It should be
noted, also, that shortly after the formation of the concern the common
stock which had been issued fell with a crash, and the outsiders who
risked their fortunes in the concern were ruined.[47]

All of the leading trusts and railways were, even at their inception,
intimately connected through cross investments and interlocking
directorates. Writing in 1904, Mr. Moody, an eminent financial
authority, said: "Around these two groups [the Morgan-Rockefeller
interests], or what must ultimately become one greater group, all other
smaller groups of capitalists congregate. They are all allied and
intertwined by their various mutual interests. For instance, the
Pennsylvania Railroad interests are on the one hand allied with the
Vanderbilts and on the other with the Rockefellers. The Vanderbilts are
closely allied with the Morgan group, and both the Pennsylvania and
Vanderbilt interests have recently become the dominating factors in the
Reading system, a former Morgan road and the most important part of the
anthracite coal combine which has always been dominated by the Morgan
people.... Viewed as a whole, we find the dominating influences in the
trusts to be made up of an intricate network of large and small
capitalists, many allied to another by ties of more or less importance,
but all being appendages to or parts of the greater groups which are
themselves dependent on and allied with the two mammoth, or Rockefeller
and Morgan, groups. These two mammoth groups jointly ... constitute the
heart of the business and commercial life of the nation."[48]

How tremendous is this corporate control over business, output, and wage
earners is indicated by the census of 1909. Of the total number of
establishments reported as engaged in manufacturing in 1904, 23.6 per
cent were under corporate ownership, while in 1909 the percentage had
increased to 25.9. Although they controlled only about one fourth of the
total number of establishments, corporations employed 70.6 per cent of
all the wage earners reported in 1904 and 75.6 per cent in 1909. Still
more significant are the figures relative to the output of corporations.
Of the total value of the product of all establishments, 73.7 per cent
was turned out by corporations in 1904 and 79 per cent in 1909. "In most
of the states," runs the Census Report, "between three fifths and nine
tenths of the total value of manufactured products in 1909 was reported
by establishments under corporate ownership." Of the 268,491
establishments reported in 1909, there were 3061 which produced 43.8 per
cent of the total value of all products and employed 30.5 per cent of
the wage earners. It is, in fact, this absorption of business by a small
number of concerns which marks the great concentration of modern
industry. The mere number of corporations is not of much significance,
for most of them are petty.

In addition to gaining control of the leading manufacturing concerns and
the chief natural resources of the country, the great capitalist
interests seized upon social values to the amount of billions of dollars
through stock watering and manipulations of one kind or another.
"Between 1868 and 1872, for example, the share capital of the Erie was
increased from $17,000,000 to $78,000,000, largely for the purpose of
stock-market manipulation.... The original Central Pacific Railroad, for
instance, actually cost only $58,000,000; it is a matter of record that
$120,000,000 was paid a construction company for the work. The syndicate
which financed the road received $62,500,000 par value in securities as
profits, a sum greater than it actually cost to build the property. The
80 per cent stock dividend of the New York Central in 1868; scrip
dividends on the Reading in the seventies; the 50 per cent dividend of
the Atchison in 1881; the 100 per cent stock dividends of the Louisville
and Nashville in 1880, by a pen stroke adding $20,000,000 to 'cost of
road' upon the balance sheet; the notorious 100 per cent dividend of the
Boston and Albany in 1882 [are further examples].... Recent inflations
of capitalization in connection with railroad consolidation are headed
by the case of the Rock Island Company. In 1902 this purely financial
corporation bought up the old Chicago, Rock Island, and Pacific Railway,
capitalized at $75,000,000 and substituted therefor its own stock to the
amount of $117,000,000, together with $75,000,000 of collateral trust
bonds, secured by the stock of the property acquired. The entire history
of the New York traction companies is studded with similar occurrences.
One instance may suffice. In 1906 the Interborough-Metropolitan Company
purchased $105,540,000 in securities of the merged lines, and issued in
place thereof $138,309,000 of its own stock and $70,000,000 in bonds....
E. H. Harriman and three associates ... expanded the total
capitalization of the [Alton] road from $33,950,000 to $114,600,000, an
increase of over $80,000,000. In improvements and additions to the
property out of this augmented capitalization, their own accounts showed
only about $18,000,000 expended. It thus appears that securities
aggregating $62,600,000 were put forth during this time [seven years,
beginning in 1898], without one dollar of consideration. This sum is
equal to about $66,000 per mile of line owned--a figure considerably in
excess of the average net capitalization of the railroads of the
country."[49]

It is not necessary to cite further evidence to show that billions of
dollars of fictitious values were saddled upon the country between the
end of the Civil War and the close of the century. A considerable
portion of the amount of stocks and bonds issued was doubtless based on
the dividend-paying power of the concerns in question. In many instances
the stock was not purchased in large quantities by the investing public,
but was simply issued to promoters, and when values collapsed they only
lost so much worthless paper. It is apparent, therefore, that all the
stock watering is not of the same character or effect; but nevertheless
it remains a fact that the buying public and the working class are
paying millions in annual tribute to the holders of paper which
represents no economic service whatever. If the water were all squeezed
out of railway, franchise, and industrial stocks and bonds and the
mineral and other resources which have been actually secured at a
nominal value, or fraudulently were returned to the government, there
would be a shrinkage in the necessary dividends paid out that would
startle the world.

       *       *       *       *       *

Those who followed the literature of political economy during this
period of gigantic consolidation and high finance could not help
discovering a decided change in the views of leading men about the
nature of industrial evolution. The old practice of indiscriminate abuse
of all trusts began to undergo a decided modification; only persons from
the backward industrial regions of the West and South continued the
inordinate clamor for the immediate and unconditional dissolution of all
of them, on the theory that they were "artificial" products, brought
forth and nourished by malicious men bent solely upon enhancing their
personal fortunes. The socialist contention (set forth by Marx and
Engels in 1848) that competition destroyed itself, and that the whole
movement of industry was inevitably toward consolidation, began to
receive attention, although the socialist solution of the problem was
not accepted.

This change in attitude was the result partly of the testimony of
practical business men before the Industrial Commission in 1900, which
was summarized in the following manner by the Commission: "Among the
causes which have led to the formation of industrial combinations, most
of the witnesses were of the opinion that competition, so vigorous that
profits of nearly all competing establishments were destroyed, is to be
given the first place. Even Mr. Havemeyer said this, though, as he
believed that in many cases competition was brought about by the fact
that the too high protective tariff had tempted too many rivals into
the field, he named the customs tariff law as the primal cause. Many of
the witnesses say that their organization was formed to make economies,
to lessen competition, and to get higher profits--another way of saying
that competition is the cause without conceding that the separate plants
were forced to combine."

In a careful and thoughtful analysis of the problem, published in 1900
by Professor J. W. Jenks, then of Cornell University, the wastes of
competition and the economies of combination (within limits) were
pointed out with clarity and precision. The Industrial Commission had
reported that rebates and discriminations by railways had been declared
to be a leading cause of combination by several witnesses appearing
before it; but Professor Jenks at the close of his survey came to the
positive conclusion "that, whenever the nature of the industry is one
which is peculiarly adapted for organization on a large scale, these
peculiarities will so strengthen the tendency toward a virtual monopoly
that, without legal aid and special discriminations or advantages being
granted by either the State or any other influence, a combination will
be made, and if shrewdly managed can and, after more experience in this
line has been gained, probably will practically control permanently the
market, unless special legal efforts better directed than any so far
attempted shall prevent."[50] The logical result of this conclusion is
at least government supervision, and this Mr. Jenks advocated.

Whether some special privileges beyond the ownership of basic natural
resources was necessary to bring about combinations on a large scale,
the leaders in such combinations seem to have engaged extensively in
politics, contributing to the campaign funds of both parties, helping to
select their candidates, and maintaining expensive lobbies at Washington
and at the capitals of the several states. Mr. Havemeyer admitted before
a Senate committee in 1893 that the Sugar Trust was "a Democrat in a
Democratic state and a Republican in a Republican state"; and added that
in his opinion all other large corporations made contributions to the
two leading parties as a matter of course, for "protection." The
testimony taken by the New York insurance investigating committee in
1905 and by the Clapp committee of the United States Senate in 1912
revealed the fact that during the period between 1896 and 1912 millions
of dollars had been contributed to the Republican party by the men who
had been most active in organizing the great industrial combinations,
and that representatives of the same group had also given aid and
comfort to the Democratic party,[51] although the latter, being out of
power at Washington, could not levy tribute with the same effectiveness.

The statesman of the new capitalism was Mr. Marcus A. Hanna. Mr. Hanna
was born in 1837 of pioneer stock of the second or third generation,
after the roughness of the earlier days was somewhat smoothed away
without injury to the virility of the fiber. He entered business in
Cleveland in 1858 at a time when a remarkable group of business men,
including Mr. John D. Rockefeller, were laying the foundation of their
fortunes. Endowed with hard, practical, economic sense, he refused to be
carried away by the enthusiasm that was sweeping thousands of young men
of his age into the Union army, and he accordingly remained at his post
of business.[52] It was fortunate for his career that he did not lose
those four years, for it was then that he made the beginnings of his
great estate in coal, iron, oil, and merchandising.

Mr. Hanna, like most of the new generation of northern business men, was
an ardent Republican. "He went into politics as a citizen," remarks his
biographer. "The motive, in so far as it was conscious, was undoubtedly
patriotic. That he should wish to serve his country as well as himself
and his family was rooted in his make-up. If he proposed to serve his
country, a man of his disposition and training could only do so by
active work in party politics. Patriotism meant to him Republicanism.
Good government meant chiefly Republican government. Hence the extreme
necessity of getting good Republicans elected and the absolute identity
in his mind and in the minds of most of his generation between public
and party service."[53] In his early days, therefore, he participated in
politics in a small way, but it was not until 1891, during the candidacy
of Mr. McKinley for governor of Ohio and Mr. Sherman for the Senate,
that he began to serve his party in a large way by raising campaign
funds.[54]

In 1895 Mr. Hanna retired from active business and set about the task
of elevating Mr. McKinley to the Presidency. He spent a great deal of
time at first in the South securing Republican delegates from the states
where the Republican party was a shadow, and other than party
considerations entered largely into selection of delegates to the
Republican convention. While laying a solid foundation in the South, Mr.
Hanna bent every effort in capturing the delegates in northern states.
According to Mr. Croly, "Almost the whole cost of the campaign for Mr.
McKinley's nomination was paid by Mr. Hanna.... He did receive some help
from Mr. McKinley's personal friends in Ohio and elsewhere, but its
amount was small compared to the total expenses. First and last Mr.
Hanna contributed something over $100,000 toward the expense of the
canvass."[55]

Mr. Hanna firmly believed, and quite naturally too, that the large
business concerns which had prospered under the policies of the
Republican party should contribute generously to its support. As early
as 1888, when the tariff scare seized certain sections of the country,
he was selected as financial auxiliary to the Republican national
committee, and raised about $100,000 in Cleveland, Toledo, Mahoning
Valley, and adjacent territory.[56]

But Mr. Hanna's greatest exploits in financing politics were in
connection with Mr. McKinley's campaigns. In 1896 he at first
encountered some difficulties because of his middle western connections
and the predilection of Wall Street for Mr. Levi P. Morton in preference
to Mr. McKinley. "Mr. James J. Hill states that on August 15, just when
the strenuous work of the campaign was beginning, he met Mr. Hanna by
accident in New York and found the chairman very much discouraged. Mr.
Hanna described the kind of work which was planned by the Committee and
its necessarily heavy expense. He had been trying to raise the needed
money, but with only small success. The financiers of New York would not
contribute. It looked as if he might have to curtail his plan of
campaign, and he was so disheartened that he talked about quitting. Mr.
Hill immediately offered to accompany Mr. Hanna on a tour through the
high places of Wall Street, and during the next five days they succeeded
in collecting as much money as was immediately necessary. Thereafter Mr.
Hanna did not need any further personal introduction to the leading
American financiers."[57]

Many grave charges were brought against Mr. Hanna to the effect that he
had no scruples in the use of money for corrupt purposes, but such
charges have never been substantiated to the satisfaction of his
friends. That in earlier days he employed the methods which were common
among public service corporations, is admitted by his biographer, but
condoned on the ground that practically every other street railway
company in the country was confronted with the alternative of buying
votes or influence. Mr. Hanna's Cleveland company "the West Side Street
Railway Company and its successors were no exception to this rule. It
was confronted by its competitors, who had no scruples about employing
customary methods, and if it had been more scrupulous than they, its
competitors would have carried off all the prizes. Mr. Hanna had, as I
have said, a way of making straight for his goal.... He and his company
did what was necessary to obtain the additional franchises needed for
the development of the system. The railroad contributed to local
campaign committees and the election expenses of particular councilmen;
and it did so for the purpose of exercising an effective influence over
the action of the council in street railway matters."[58]

Grave charges were also made at the time of Mr. Hanna's candidacy for
the United States Senate that he employed the methods which he had found
so advantageous in public-service-corporation politics, but his
biographer, Mr. Croly, indignantly denies the allegation, showing very
conclusively that Mr. Hanna won his nomination squarely on the issue put
before the Republican voters and was under the rules of politics
entitled to the election by the legislature. Mr. Hanna's career, says
Mr. Croly, "demanded an honorable victory. Like every honest man he had
conscientious scruples about buying votes for his own political benefit,
and his conscience when aroused was dictatorial.... It does not follow
that no money was corruptly used for Mr. Hanna's benefit. Columbus
[Ohio] was full of rich friends less scrupulous than he.... They may
have been willing to spend money in Mr. Hanna's interest and without his
knowledge. Whether as a matter of fact any such money was spent I do not
know, but under the circumstances the possibility thereof should be
frankly admitted."[59]

In his political science as well as his business of politics, Mr. Hanna
looked to the instant need of things. He does not seem to have been a
student of history or of the experience of his own or other countries in
the field of social legislation. As United States Senator he made
practically no speeches, if we except his remarks in favor of ship
subsidies and liberal treatment of armor plate manufacturers. On the
stump, for in later years he developed some facility in popular
addresses, he confined his reflections to the customary generalizations
about prosperity and his chief contribution to political phraseology was
the slogan, "Stand pat."[60] When not engaged in actual labor of
partisan contests, Mr. Hanna seems to have enjoyed the pleasure of the
table and good company rather than the arduous researches of the student
of politics. He had an immense amount of shrewd practical sense, and he
divined a good deal more by his native powers of quick perception than
many a statesman of the old school, celebrated for his profundity as a
"constitutional lawyer and jurist."

The complete clew to Mr. Hanna's philosophy of politics is thus summed
up by his penetrating and sympathetic biographer, Mr. Croly: "We must
bear in mind that (1) he was an industrial pioneer and instinctively
took to politics as well as to business; (2) that in politics as in
business he wanted to accomplish results; (3) that politics meant to him
active party service; (4) that successful party service meant to him the
acceptance of prevailing political methods and abuses; and (5) finally
that he was bound by the instinctive consistency of his nature to
represent in politics, not merely his other dominant interest, but the
essential harmony between the interests of business and that of the
whole community." In other words, Mr. Hanna believed consistently and
honestly in the superior fitness of business men to conduct the politics
of a country which was predominantly commercial in character. He was not
unaware of the existence of a working class; in fact he was said to be a
generous and sympathetic employer of labor; but he could not conceive
the use of government instrumentalities frankly in behalf of that class.
Indeed, he thought that the chief function of the government was to help
business and not to inquire into its methods or interfere with its
processes.

An illustration of Mr. Hanna's theory of governmental impotence in the
presence of the dominant private interests was afforded in the debate in
the Senate over the price to be paid for armor plate, in the summer of
1900. The Senate proposed that not more than a stipulated price should
be paid to the two steel companies, Carnegie and Bethlehem, which were
not competing with each other; and that, in case they failed to accept,
a government manufacturing plant should be erected. Mr. Hanna's
proposition was that the price of steel should be left, as the House had
proposed, with the Secretary of the Navy, and he warmly resisted all
government interference. When it was brought out in debate that the
steel companies had refused the government officers the data upon which
to determine whether the price charged was too high, Mr. Hanna
declared: "They did perfectly right in not disclosing those facts. That
is their business; and if they chose not to give the information to the
public, that was their business also." In short, he took the position
that the government should provide ample protection to the steel
interests against foreign competition, and pay substantially whatever
the steel companies might charge for armor plate (for without proper
data the Secretary of the Navy could not know when prices were
reasonable), and then ask them no questions whatever. Here we have both
_laissez faire_ and capitalism in their simplest form.

Mr. Hanna, however, had none of the arts of the demagogue, not even the
minor and least objectional arts. His bluntness and directness in labor
conflicts won for him the respect of large numbers of his employees. His
frank and open advocacy of ship subsidies and similar devices commanded
the regard, if not the esteem, of his political enemies. His chief
faults, as viewed by his colleagues as well as his enemies, were in many
instances his leading virtues. If some of the policies and tactics which
he resorted to are now discredited in politics, it must be admitted that
he did not invent them, and that it was his open and clean-cut advocacy
of them that first made them clearly intelligible to the public. When
all the minor and incidental details and personalities of the conflicts
in which he was engaged are forgotten, Mr. Hanna will stand out in
history as the most resourceful and typical representative of the new
capitalism which closed the nineteenth century and opened the new.


_The Development of the Urban Population_

The rapid advance of business enterprise which followed the Spanish War
made more striking than ever the social results of the industrial
revolution.[61] In the first place, there was a notable growth in the
urban as contrasted with the rural population. At the close of the
century more than one third of the population had become city dwellers.
The census of 1910 classified as urban all thickly populated areas of
more than 2500 inhabitants, including New England towns which are in
part rural in character, and on this basis reported 46.3 per cent of the
population of the United States as urban and 53.7 rural. On this basis,
92.8 per cent of the population of Massachusetts was reported as urban,
78.8 per cent in New York, and 60.4 per cent in Pennsylvania. That
census also reported that "the rate of increase for the population of
urban areas was over three times that for the population living in rural
territory."

The industrial section of this urban population was largely composed of
non-home owners. The census of 1900 reported "that the largest
proportion of hired homes, 87.9 per cent, is found in New York City. In
Manhattan and Bronx boroughs the proportion is even higher, 94.1 per
cent, as compared with 82 per cent for Brooklyn.... There is also a very
large proportion of hired homes in Boston, Fall River, Jersey City, and
Memphis, constituting in each of them four fifths of all the homes in
1900." Of the great cities having a large proportion of home owners,
Detroit stood at the head, with 22.5 per cent of the population owning
homes free of mortgage.

Another feature of the evolution of the working class was the influx of
foreign labor, and the change in its racial character. The total alien
immigration between 1880 and 1900 amounted to about 9,000,000; and in
1905 the immigration for the fiscal year reached 1,026,449. For the
fiscal year 1910 it reached 1,198,037. During this period the racial
composition of the immigration changed decidedly. Before 1880 Celtic and
Teutonic nations furnished three fourths of the immigrants; but in 1905
the proportions were reversed and Slavic and Iberian nations, Italy
leading, sent three fourths of the immigrants.

This alien population drifted naturally to the industrial cities, and
the census of 1910 reported that of the 229 cities having 25,000
inhabitants and more, the native whites of native parentage furnished
only 35.6 per cent, and that the foreign-born whites constituted 44.5
per cent in Perth Amboy, New Jersey, 40.4 per cent in New York City, and
35.7 per cent in Chicago. From the standpoint of politics, a significant
feature of this development is the manning of American industries
largely by foreign laborers who as aliens possess no share in the
government.

A third important aspect of this transformation in the mass of the
population is the extensive employment of women in industries. The
census of 1910 reported that 19.5 per cent of the industrial wage
earners were women, and that the proportion of women breadwinners was
steadily increasing. The proportion of females who were engaged in
gainful pursuits was 14.7 per cent in 1870, 16 per cent in 1880, 19 per
cent in 1890, and 20.6 per cent in 1900. At the last date, about one
third of the females over ten years of age in Philadelphia were engaged
in gainful pursuits, and one eighth were employed in industries. At the
same time about 15,000 out of 42,000 women at Fall River, Massachusetts,
were in industries.


_The Labor Movement_

The centralization of capital and the development of the new statesmen
of Mr. Hanna's school were accompanied by a consolidation of the
laboring classes and the evolution of a more definite political program
for labor. As has been pointed out above, the economic revolution which
followed the Civil War was attended by the formation of unions in
certain trades and by the establishment of the Knights of Labor. This
national organization was based on the principle that all of the working
class could be brought together in a great society, equipped for waging
strikes in the field of industry and advancing a program of labor
legislation at the same time. This society, like a similar one promoted
by Robert Owen in England half a century before, fell to pieces on
account of its inherent weaknesses, particularly the inability of the
leaders to overcome the indifference of the workingmen in prosperous
trades to the struggles of their less fortunate brethren.

Following the experience of England also, the labor leaders began to
build on a more secure foundation; namely, the organization of the
members of specific trades into local unions followed by their
amalgamation into larger societies. Having failed to stir a class
consciousness, they fell back upon the trade or group consciousness of
identical interests. In 1881, ninety-five trade-unions were federated on
a national scale, and in 1886 this society was reorganized as the
American Federation of Labor. The more radical labor men went on with
the Knights, but the foundations of that society were sapped by the more
solidly organized rival, which, in spite of many defeats and reverses,
steadily increased in its membership and strength. In 1910 the
Federation reported that its affiliations included 120 international
unions, 39 state federations, 632 city central bodies, 431 local
trade-unions, and 216 Federal labor unions, with a membership totaling
1,744,444 persons.

Unlike German and English trade-unionists, the American Federation of
Labor steadily refused to go into politics as a separate party
contesting at the polls for the election of "labor" representatives.
This abstention from direct political action was a matter of expediency,
it seems, rather than of set principle. Mr. John Mitchell, the eminent
former leader of the miners, declared that "wage earners should in
proportion to their strength secure the nomination and election of a
number of representatives to the governing bodies of city, state, and
nation"; but he added that "a third Labor Party is not for the present
desirable, because it could not obtain a majority and could not
therefore force its will upon the community at large." This view, Mr.
Mitchell admitted, was merely temporary and due to circumstances, for
he frankly said: "Should it come to pass that the two great American
political parties oppose labor legislation as they now favor it, it
would be the imperative duty of unionists to form a third party to
secure some measure of reform." This was also substantially the position
taken by the President of the American Federation, Mr. Gompers.

But it is not to be supposed that the American Federation of Labor
refused to consider the question of labor in politics. Its prominent
leaders were affiliated with the American Civic Federation, composed
largely of employers of labor, professional men, and philanthropists,
and known as one of the most powerful anti-socialist organizations in
the United States. Not only were Mr. Gompers and other labor leaders
associated with this society which strongly opposed the formation of a
class party in the United States, but they steadily waged war on the
socialists who were attempting to organize the working class
politically. The leaders in the American Federation, with a few
exceptions, were thus definitely anti-socialist and were on record on
this political issue. Moreover, while warning workingmen against
political action, Mr. Gompers and Mr. Mitchell openly identified
themselves with the Democratic party and endeavored to swing the working
class vote to that party. Mr. Gompers was especially active in the
support of Mr. Bryan in 1908, and boasted that 80 per cent of the voting
members of the Federation cast their ballots for the Democratic
candidate.

In fact, a study of the writings and speeches of the leaders in the
American Federation of Labor shows that they had a fairly definite
politico-economic program, although they did not admit it. They favored
in general municipal and government ownership of what are called
"natural" monopolies, and they sympathized with the smaller business men
in their attempt to break up the great industrial corporations against
which organized labor had been able to make little headway. They
supported all kinds of labor legislation, such as a minimum wage,
workmen's compensation, sanitary laws for factories, the shortening of
hours, prohibition of child labor, insurance against accidents, sickness
and old age pensions, and industrial education. They were also on record
in favor of such political reforms as the initiative, referendum, and
recall, and they were especially vigorous in their efforts to curtail
the power of the courts to issue injunctions against strikers. In other
words, they leaned decidedly toward "state socialism" and expected to
secure their ends by supporting the Democratic party, historically the
party of individualism, and _laissez faire_. This apparent anomaly is
explained by the fact that state socialism does not imply the political
triumph of the working class, but rather the strengthening of the petty
bourgeoisie against great capitalists.

It would be a mistake, however, to conclude that the American Federation
of Labor was solidly in support of Mr. Gompers' program. On the
contrary, at each national convention of the Federation the socialist
members attempted to carry the organization over into direct political
action. These attempts were defeated each year, but close observers of
the labor movement discovered that the socialists were electing a large
number of local and state trade-union officials, and those who hope to
keep the organization in the old paths are anxious about the outcome at
the end of Mr. Gompers' long service.

FOOTNOTES:

     [47] _Report of the Commissioner of Corporations on the Steel
     Industry_, July 1, 1911.

     [48] Moody, _The Truth about the Trusts_, p. 493.

     [49] Professor W. Z. Ripley, _Political Science Quarterly_,
     March, 1911.

     [50] _The Trust Problem_ (1900 ed.), p. 210.

     [51] See the Parker episode, below, p. 268.

     [52] Mr. Hanna was drafted in 1864, but saw no actual
     service. Croly, _Marcus A. Hanna_, p. 44.

     [53] Croly, p. 113.

     [54] _Ibid._, p. 160.

     [55] Croly, p. 183.

     [56] _Ibid._, p. 149.

     [57] Croly, p. 219.

     [58] Croly, p. 81.

     [59] _Ibid._, p. 264.

     [60] Croly, p. 417.

     [61] See above, Chap. II.




CHAPTER X

THE ADMINISTRATIONS OF THEODORE ROOSEVELT


The administrations of Mr. Roosevelt cannot be characterized by a
general phrase, although they will doubtless be regarded by historians
as marking an epoch in the political history of the United States. If we
search for great and significant social and economic legislation during
that period, we shall hardly find it, nor can we discover in his
numerous and voluminous messages much that is concrete in spite of their
immense suggestiveness. The adoption of the income tax amendment, the
passage of the amendment for popular election of Senators, the
establishment of parcel post and postal savings banks, and the
successful prosecution of trusts and combinations,--all these
achievements belong in time to the administration of Mr. Taft, although
it will be claimed by some that they were but a fruition of plans laid
or policies advocated by Mr. Roosevelt.

One who attempts to estimate and evaluate those eight years of
multifarious activity will find it difficult to separate the transient
and spectacular from the permanent and fundamental. In the foreground
stand the interference in the coal strike, the acquisition of the Panama
Canal strip, voluminous messages discussing every aspect of our complex
social and political life, vigorous and spirited interference with state
elections, as in the case of Mr. Hearst's campaign in New York, and in
city politics, as in the case of Mr. Burton's contest in Cleveland,
Ohio, the pressing of the idea of conserving natural resources upon the
public mind, acrimonious disputes with private citizens like Mr.
Harriman, and, finally, the closing days of bitter hostilities with
Congress over the Tennessee Coal and Iron affair and appropriations for
special detectives to be at executive disposal.


_Mr. Roosevelt's Doctrines_

During those years the country was much torn with the scandals arising
from investigations, such as the life insurance inquest in New York,
which revealed grave lapses from the paths of rectitude on the part of
men high in public esteem, and gross and vulgar use of money in
campaigns. No little of the discredit connected with these affairs fell
upon the Republican party, not because its methods were shown to be
worse in general than those of the Democrats, but because it happened to
be in power. The great task of counteracting this discontent fell upon
Mr. Roosevelt, who smote with many a message the money changers in the
temple of his own party, and convinced a large portion of the country
that he had not only driven them out but had refused all association
with them.

Mr. Roosevelt was thus quick to catch the prevailing public temper. "It
makes not a particle of difference," he said in 1907, "whether these
crimes are committed by a capitalist or by a laborer, by a leading
banker or manufacturer or railroad man, or by a leading representative
of a labor union. Swindling in stocks, corrupting legislatures, making
fortunes by the inflation of securities, by wrecking railroads, by
destroying competitors through rebates,--these forms of wrongdoing in
the capitalist are far more infamous than any ordinary form of
embezzlement or forgery.... The business man who condones such conduct
stands on a level with the labor man who deliberately supports a corrupt
demagogue and agitator."

       *       *       *       *       *

Any one who takes the trouble to examine with care Mr. Roosevelt's
messages and other public utterances during the period of his
administration will discover the elements of many of his policies which
later took more precise form.

In his first message to Congress, on December 3, 1901, Mr. Roosevelt
gave considerable attention to trusts and collateral economic problems.
He refused to concede the oft-repeated claim that great fortunes were
the product of special legal privileges. "The creation of these great
corporate fortunes," he said, "has not been due to the tariff nor to any
other governmental action, but to natural causes in the business world,
operating in other countries as they operate in our own. The process has
aroused much antagonism, a great part of which is wholly without
warrant. It is not true that as the rich have grown richer, the poor
have grown poorer. On the contrary, never before has the average man,
the wage worker, the farmer, the small trader, been so well off as in
this country at the present time. There have been abuses connected with
the accumulation of wealth; yet it remains true that a fortune
accumulated in legitimate business can be accumulated by the person
specially benefitted only on condition of conferring immense incidental
benefits upon others."

While thus contending that large fortunes in the main were the product
of "natural economic forces," Mr. Roosevelt admitted that some grave
evils had arisen in connection with combinations and trusts, and
foreshadowed in his proposed remedial legislation the policy of
regulation and new nationalism. "When the Constitution was adopted, at
the end of the eighteenth century, no human wisdom could foretell the
sweeping changes, alike in industrial and political conditions, which
were to take place by the beginning of the twentieth century. At that
time it was accepted as a matter of course that the several states were
the proper authorities to regulate ... the comparatively insignificant
and strictly localized corporate bodies of the day. The conditions are
now wholly different, and a wholly different action is called for." The
remedy he proposed was publicity for corporate affairs, the regulation,
not the prohibition, of great combinations, the elimination of specific
abuses such as overcapitalization, and government supervision. If the
powers of Congress, under the Constitution, were inadequate, then a
constitutional amendment should be submitted conferring the proper
power. The Interstate Commerce Act should likewise be amended. "The
railway is a public servant. Its rates should be just to and open to all
shippers alike. The Government should see to it that within its
jurisdiction this is so." Conservation of natural resources, irrigation
plans, the creation of a department of Commerce and Labor, army and navy
reform, and the construction of the Panama Canal were also recommended
at the same time (1901).

In this message, nearly all of Mr. Roosevelt's later policies as
President are presaged, and in it also are marked the spirit and
phraseology which have done so much to make him the idol of the American
middle class, and particularly of the social reformer. There are, for
instance, many little aphorisms which appeal to the moral sentiments.
"When all is said and done," he says, "the rule of brotherhood remains
as the indispensable prerequisite to success in the kind of national
life for which we are to strive. Each man must work for himself, and
unless he so works no outside help can avail him; but each man must
remember also that he is indeed his brother's keeper, and that, while no
man who refuses to walk can be carried with advantage to himself or any
one else, yet each at times stumbles or halts, each at times needs to
have the helping hand outstretched to him." The "reckless agitator" and
anarchist are dealt with in a summary fashion, and emphasis is laid on
the primitive virtues of honesty, sobriety, industry, and
self-restraint. The new phrases of the social reformer also appear side
by side with the exclamations of virtuous indignation: "social
betterment," "sociological law," "rule of brotherhood," "high aims,"
"foolish visionary," "equity between man and man"--in fact the whole
range of the terminology of social "uplift."

None of Mr. Roosevelt's later messages added anything new by way of
economic doctrine or moral principle. The same notions recurred again
and again, often in almost identical language and frequently in the form
of long quotations from previous messages. But there appeared from time
to time different concrete proposals, elaborating those already
suggested to Congress. The tariff he occasionally touched upon, but
never at great length or with much emphasis. He frequently reiterated
the doctrine that the country was committed to protection, that the
tariff was not responsible for the growth of combinations and trusts,
and that no economic question of moment could be solved by its revision
or abandonment.

As to the trusts, Mr. Roosevelt consistently maintained the position
which he had taken as governor of New York and had stated in his first
message; namely, that most of the legislation against trusts was futile
and that publicity and governmental supervision were the only methods of
approaching the question which the logic of events admitted. In his
message of December, 1907, he said: "The anti-trust law should not be
repealed; but it should be made more efficient and more in harmony with
actual conditions. It should be so amended as to forbid only the kind of
combination which does harm to the general public, such amendment to be
accompanied by, or to be an incident of, a grant of supervisory power to
the Government over these big concerns engaged in interstate business.
This should be accompanied by provision for the compulsory publication
of accounts and the subjection of books and papers to the inspection of
the Government officials.... The Congress has the power to charter
corporations to engage in interstate and foreign commerce, and a general
law can be enacted under the provisions of which existing corporations
could take out federal charters and new federal corporations could be
created. An essential provision of such a law should be a method of
predetermining by some federal board or commission whether the applicant
for a federal charter was an association or combination within the
restrictions of the federal law. Provision should also be made for
complete publicity in all matters affecting the public, and complete
protection to the investing public and the shareholders in the matter of
issuing corporate securities. If an incorporation law is not deemed
advisable, a license act for big interstate corporations might be
enacted; or a combination of the two might be tried. The supervision
established might be analogous to that now exercised over national
banks. At least, the anti-trust act should be supplemented by specific
prohibitions of the methods which experience has shown have been of most
service in enabling monopolistic combinations to crush out competition.
The real owners of a corporation should be compelled to do business in
their own name. The right to hold stock in other corporations should be
denied to interstate corporations, unless on approval by the proper
Government officials, and a prerequisite to such approval should be the
listing with the Government of all owners and stockholders, both by the
corporation owning such stock and by the corporation in which such stock
is owned."

With that prescience which characterized his political career from his
entrance into politics, Mr. Roosevelt foresaw that it was impossible
for capitalists in the United States to postpone those milder reforms,
such as employers' liability, which had been accepted in the enlightened
countries of Europe long before the close of the nineteenth century. In
his message of December 3, 1907, he pointed out that "the number of
accidents to wage-workers, including those that are preventable and
those that are not, has become appalling in the mechanical,
manufacturing and transportation operations of the day. It works grim
hardship to the ordinary wage-worker and his family to have the effect
of such an accident fall solely upon him." Mr. Roosevelt thereupon
recommended the strengthening of the employers' liability law which had
been recently passed by Congress, and urged upon that body "the
enactment of a law which will ... bring federal legislation up to the
standard already established by all European countries, and which will
serve as a stimulus to the various states to perfect their legislation
in this regard."

As has been pointed out above, Mr. Roosevelt, in all of his
recommendations, took the ground that the prevailing system of
production and distribution of wealth was essentially sound, that
substantial justice was now being worked out between man and man, and
that only a few painful excrescences needed to be lopped off. Only on
one occasion, it seems, did he advise the adoption of any measures
affecting directly the distribution of acquired wealth. In his message
of December 3, 1907, he declared that when our tax laws were revised,
the question of inheritance and income taxes should be carefully
considered. He spoke with diffidence of the latter because of the
difficulties of evasion involved, and the decision of the Supreme Court
in 1895. "Nevertheless," he said, "a graduated income tax of the proper
type would be a desirable feature of federal taxation, and it is to be
hoped that one may be devised which the Supreme Court will declare
constitutional." The inheritance tax was, in his opinion, however,
preferable; such a tax had been upheld by the Court and was "far more
important for the purpose of having the fortunes of the country bear in
proportion to their increase in size a corresponding increase and burden
of taxation." He accordingly approved the principle of a progressive
inheritance tax, increasing to perhaps 25 per cent in the case of
distant relatives.

While advocating social reforms and castigating wrong-doers at home, Mr.
Roosevelt was equally severe in dealing with Latin-American states which
failed to discharge their obligations to other countries faithfully. In
his message of December, 1905, he said: "We must make it evident that we
do not intend to permit the Monroe doctrine to be used by any nation on
this continent as a shield to protect it from the consequences of its
own misdeeds against foreign nations. If a republic to the south of us
commits a tort against a foreign nation, such as an outrage against a
citizen of that nation, then the Monroe doctrine does not force us to
interfere to prevent the punishment of the tort, save to see that the
punishment does not assume the form of territorial occupation in any
shape. The case is more difficult when it refers to a contractual
obligation.... The country would certainly decline to go to war to
prevent a foreign government from collecting a just debt; on the other
hand it is very inadvisable to permit any foreign power to take
possession, even temporarily, of the custom houses of an American
republic in order to enforce the payment of its obligations; for such a
temporary occupation might turn into a permanent occupation. The only
escape from these alternatives may at any time be that we must ourselves
undertake to bring about some arrangement by which so much as possible
of a just obligation shall be paid."

       *       *       *       *       *

Mr. Roosevelt's messages and various activities while he was serving the
unexpired term of President McKinley upset all of the conservative
traditions of the executive office. He intervened, without power, in the
anthracite coal strike of 1902, and had the satisfaction of seeing the
miners make substantial gains at the hands of a commission appointed by
himself, to which the contestants had agreed to submit the issues. He
began a prosecution of the Northern Securities Company at a time when
such actions against great combinations of capital were unfashionable.
He forced an investigation of the post-office administration in 1903,
which revealed frauds of huge dimensions; and he gave the administration
of public lands a turning over which led to the successful criminal
prosecution of two United States Senators. Citizens acquired the habit
of looking to the headlines of the morning paper for some new and
startling activity on the part of the President. Politicians of the old
school in both parties, who had been used to settling difficulties by
quiet conferences within the "organization," stood aghast. They did not
like Mr. Roosevelt's methods which they characterized as "erratic"; but
the death of Mr. Hanna in February, 1904, took away the only forceful
leader who might have consolidated the opposition within Republican
ranks.


_The Campaign of 1904_

Nevertheless the rumor was vigorously circulated that Mr. Roosevelt was
violently opposed by "Wall Street and the Trusts." Whatever may have
been the source of this rumor it only enhanced the President's
popularity. In December, 1903, Senator O. H. Platt wrote: "I do not know
how much importance to attach to the current opposition to Roosevelt by
what are called the 'corporate and money influences' in New York....
There is a great deal said about it, as if it were widespread and
violent. I know that it does not include the whole of that class of
people, because I know many bankers and capitalists, railroad and
business men who are his strong, good friends, and they are not among
the smaller and weaker parties, either.... Now it is a great mistake for
capitalistic interests to oppose Roosevelt.... I think he will be
nominated by acclamation, so what is to be gained by the Wall Street
contingent and the railroad interests in this seeming opposition to
him?... There is no Republican in the United States who can be elected
except Roosevelt.... He is going to be the people's candidate, not the
candidate of the trusts or of the hoodlums, but of the conservative
elements."

The Republican convention in 1904 was uneventful beyond measure. Though
Mr. Roosevelt was disliked by many members of his party, his nomination
was unavoidable, and even his opponents abstained from any word or deed
that might have disturbed the concord of the occasion. The management of
the convention was principally in the hands of the men from whom Mr.
Roosevelt afterward broke and stigmatized as "reactionary." Mr. Elihu
Root was temporary chairman, Mr. Joseph G. Cannon was permanent
chairman, Mr. Henry Cabot Lodge was chairman of the committee on
resolutions which reported the platform, Mr. W. M. Crane and Mr. Boies
Penrose were selected as members of the national committee from their
respective states, and Mr. Frank S. Black, of New York, made the speech
nominating Mr. Roosevelt. Throughout, the proceedings were harmonious;
the platform and the nomination were accepted vociferously without a
dissenting vote.

The Republican platform of 1904 gave no recognition of any of the newer
social and economic problems which were soon to rend that party in
twain. After the fashion of announcements made by parties already in
power, it laid great emphasis upon Republican achievements since the
great victory of 1896. A protective tariff under which all industries
had revived and prospered had been enacted; public credit was now
restored, Cuban independence established, peace, freedom, order, and
prosperity given to Porto Rico, the Philippine Islands endowed with the
largest civil liberty ever enjoyed there, the laws against unjust
discriminations by vast aggregations of capital fearlessly enforced,
and the gold standard upheld. The program of positive action included
nothing new: extension of foreign markets, encouragement of American
shipping, enforcement of the Fourteenth Amendment wherever the suffrage
had been curtailed, and indorsement of civil service, international
arbitration, and liberal pensions. The trust plank was noncommittal as
to concrete policy: "Combinations of capital and of labor are the
results of the economic movement of the age, but neither must be
permitted to infringe the rights and interests of the people. Such
combinations, when lawfully formed for lawful purposes, are alike
entitled to the protection of the laws, but both are subject to the laws
and neither can be permitted to break them."

In their campaign book for 1904, the Republican leaders exhibited Mr.
Roosevelt as the ideal American in a superlative degree. "Theodore
Roosevelt's character," runs the eulogy, "is no topic for difference
of opinion or for party controversy. It is without mystery or
concealment. It has the primary qualities that in all ages have been
admired and respected: physical prowess, great energy and vitality,
straightforwardness and moral courage, promptness in action, talent for
leadership.... Theodore Roosevelt, as a typical personality, has won the
hearty confidence of the American people; and he has not shrunk from
recognizing and using his influence as an advocate of the best standards
of personal, domestic, and civic life in the country. He has made these
things relating to life and conduct a favorite theme in speech and essay
and he has diligently practiced what he preached. Thus he has become a
power for wholesomeness in every department of our life as a people."

       *       *       *       *       *

The Democratic nominee, Mr. Alton B. Parker, failed to elicit any
enthusiasm in the rank and file of the party. He had supported the
Democratic candidate at a time when many of his conservative friends had
repudiated Mr. Bryan altogether, and thus he could not be branded as a
"bolter." But Mr. Parker's long term of service as judge of the highest
court of New York, his remoteness from actual partisan controversies,
his refusal to plunge into a whirlwind stumping campaign, and his
dignified reserve, all combined to prevent his getting a grip upon the
popular imagination. His weakness was further increased by the
half-hearted support given by Mr. Bryan who openly declared the party to
be under the control of the "Wall Street element," but confessed that he
intended to give his vote to Mr. Parker, although the latter, in a
telegram to the nominating convention at St. Louis, had announced his
unflinching adherence to the gold standard.

The Democratic platform, except in its denunciation of the Republican
administration, was as indefinite as the occasion demanded. Independence
should be promised to the Filipinos at the proper time and under proper
circumstances; there should be a revision and gradual reduction of the
tariff by "the friends of the masses"; United States Senators should be
elected by popular vote; combinations and trusts which restrict
competition, control production, or fix prices and wages should be
forbidden and punished by law. The administration of Mr. Roosevelt was
denounced as "spasmodic, erratic, sensational, spectacular, and
arbitrary," and the proposal of the Republican platform to enforce the
Fourteenth Amendment was condemned as "Bourbon-like, selfish, and
narrow," and designed to kindle anew the embers of racial and sectional
strife. Constitutional, simple, and orderly government was promised,
affording no sensations, offering no organic changes in the political or
economic structure, and making no departures from the government "as
framed and established by the fathers of the Republic."

       *       *       *       *       *

The only extraordinary incident in the campaign of 1904 occurred toward
the closing days, when Mr. Parker repeatedly charged that the Republican
party was being financed by contributions from corporations and trust
magnates. The Democratic candidate also declared that Mr. Cortelyou, as
Secretary of Commerce and Labor, had acquired through the use of
official inquisitorial powers inside information as to the practices of
trusts, and that as chairman of the Republican national committee, he
had used his special knowledge to extort contributions from
corporations. These corrupt and debasing methods had, in the opinion of
Mr. Parker, threatened the integrity of the republic and transformed the
government of the people into "a government whose officers are
practically chosen by a handful of corporate managers, who levy upon the
assets of the stockholders whom they represent such sums of money as
they deem requisite to place the conduct of the Government in such
hands as they consider best for their private interests."

These grave charges were made as early as October 24, and it was
expected that Mr. Cortelyou would reply immediately, particularly as Mr.
Parker was repeating and amplifying them. However, no formal answer came
until November 5, three days before the election, when a countercharge
was impossible. On that date Mr. Roosevelt issued a signed statement,
analyzing the charges of his opponent, and closing with the positive
declaration that "the statements made by Mr. Parker are unqualifiedly
and atrociously false."

No doubt it would have been difficult for Mr. Parker to have
substantiated many of the details in his charges, but the general truth
of his contention that the Republican campaign was financed by railway
and trust magnates was later established by the life insurance
investigation in New York in 1905, by the exposures of trust methods by
Mr. Hearst in the publication of Standard Oil Letters, and by the
revelations made before the Clapp committee of the Senate in 1912. It is
true, Mr. Roosevelt asserted that he knew nothing personally about the
corporation contributions, particularly the Standard Oil gifts, and
although he convinced his friends of his entire innocence in the matter,
seasoned politicians could hardly understand a naivete so far outside
the range of their experience.

The Democratic candidate and his friends took open pleasure in the
discomfiture produced in Republican ranks by these unpleasant
revelations, but no little bitterness was added to their cup of joy by
the other side of the story. During the life insurance investigation
one of the life insurance officers declared: "My life was made weary by
the Democratic candidates chasing for money in that campaign. Some of
the very men who to-day are being interviewed in the papers as
denouncing the men who contribute to campaigns,--their shadows were
crossing my path every step I took." Later, before the Clapp committee
in 1912, Mr. August Belmont and Mr. T. F. Ryan, corporation magnates
with wide-reaching financial interests,--the latter particularly famous
for his Tobacco Trust affiliations,--testified that they had
underwritten Mr. Parker's campaign to the amount of several hundred
thousand dollars. Independent newspapers remarked that it seemed to be
another case of the kettle and the pot.

That the conservative interests looked to the Republican party, if not
to Mr. Roosevelt, for the preservation of good order in politics and the
prevention of radical legislation, is shown by the campaign
contributions on the part of those who had earlier financed Mr. Hanna.
In 1907 a letter from the railroad magnate, Mr. E. H. Harriman, was made
public, in which the writer declared that Mr. Roosevelt had invited him
to Washington in the autumn of 1904, just before the election, that at
the President's request he had raised $250,000 to help carry New York
state, and that he had paid the money over to the Republican treasurer,
Mr. Bliss. Mr. Roosevelt indignantly denied that he had requested Mr.
Harriman to raise a dollar for "the Presidential campaign of 1904." It
will be noted that Mr. Roosevelt here made a distinction between the
state and national campaign. This distinction he again drew during the
United States Senate investigation in 1912, when it became apparent that
the Standard Oil Trust had made a large contribution to the Republican
politicians in 1904. From his testimony, it would appear that Mr.
Roosevelt was unaware of the economic forces which carried him to
victory in 1904. Indeed, from the election returns, he was justified in
regarding his victory as a foregone conclusion, even if the financiers
of the party had not taken such extensive precautions.

The election returns in 1904 showed that the Democratic candidate had
failed to engage the enthusiasm of his party, for the vote cast for him
was more than a million and a quarter short of that cast for Mr. Bryan
in 1900. The personal popularity of Mr. Roosevelt was fully evidenced in
the electoral and popular votes. Of the former he secured 336 against
140 cast for his opponent, and of the latter he polled nearly 400,000
more than Mr. McKinley. Nevertheless the total vote throughout the
country was nearly half a million under that of 1900, showing an
undoubted apathy or a dissatisfaction with the two old parties. This
dissatisfaction was further demonstrated in a startling way by the heavy
increase in the socialist ranks, a jump from about 95,000 in 1900 to
more than 400,000.


_The Achievements of Mr. Roosevelt's Administrations_

Doubtless the most significant of all the laws enacted during Mr.
Roosevelt's administrations was the Hepburn Act passed in 1906. This law
increased the number of the Interstate Commerce Commission[62] to
seven, extended the law to cover pipe lines, express companies, and
sleeping car companies, and bridges, ferries, and railway terminals. It
gave the Interstate Commerce Commission the power to reduce a rate found
to be unreasonable or discriminatory in cases in which complaints were
filed by shippers adversely affected; it abolished "midnight tariffs"
under which favored shippers had been given special rates, by requiring
proper notice of all changes in schedules; and it forbade common
carriers to engage in the transportation of commodities owned by
themselves, except for their own proper uses.

The Hepburn bill, however, did not confer upon the Interstate Commerce
Commission that power over rates which the Commission had long been
urging as necessary to give shippers the relief they expected. Senator
La Follette, fresh from a fight with the railways in Wisconsin, proposed
several radical amendments in the Senate, and endeavored without avail
to secure the open support of President Roosevelt.[63] The Senator
insisted that it would be possible under the Hepburn bill "for the
commission to determine whether rates were _relatively reasonable_, but
not that they were _reasonable per se_; that one rate could be compared
with another, but that the Commission had no means of determining
whether either rate so compared was itself a reasonable rate." No one
can tell, urged the Senator, whether a rate is reasonable until the
railway in question has been evaluated. This point he pressed with great
insistence, and though defeated at the time, he had the consolation of
having the principle of physical valuation enacted into law in
1913.[64] At all events, the railways found little or no fault with the
Hepburn law, and shortly afterward began to raise their rates in the
face of strong opposition from shippers.

Two laws relative to foodstuffs, the meat inspection act and the pure
food act, were passed in 1906 in response to the popular demand for
protection against diseased meats and deleterious foods and drugs--a
demand created largely by the revelation of shocking conditions in the
Chicago stockyards and of nefarious practices on the part of a large
number of manufacturers. The first of the measures was intended to
guarantee that the meat shipped in interstate commerce should be derived
from animals which were sound at the time of slaughter, prepared under
sanitary conditions in the packing houses, and adequately inspected by
Federal employees. The second measure covered foods and drugs, and
provided that such articles "must not contain any injurious or
deleterious drug, chemical or preservative, and that the label on each
package must state the exact facts and not be misleading or false in any
particular." The effect of the last of these measures was felt in the
extinction of a large number of patent medicine and other
quasi-fraudulent concerns engaged in interstate trade.

The social legislation enacted during Mr. Roosevelt's administrations is
not very extensive, although it was accompanied by much discussion at
the time. The most significant piece of labor legislation was the
employers' liability law enacted in 1906, which imposed a liability upon
common carriers engaged in interstate commerce for injuries sustained by
employees in their service. On January 6, 1908, the Supreme Court
declared the act unconstitutional on the ground that it interblended the
exercise of legitimate powers over interstate commerce and interference
with matters outside the scope of such commerce. The act was again taken
up in Congress, and in April of that year a second law, omitting the
objectionable features pointed out by the Court, was enacted.

A second piece of Federal legislation which is commonly called a labor
measure was the law which went into effect on March 4, 1908, limiting
the hours of railway employees engaged as trainmen or telegraph
operators. As a matter of fact, however, it was not so much the long
hours of trainmen which disturbed Congress as the appalling number of
railway disasters from which the traveling public suffered. At least it
was so stated by the Republican leaders in their campaign of 1908, for
they then declared that "although the great object of the Act is to
promote the safety of travellers upon railroads, by limiting the hours
of service of employees within reasonable bounds, it is none the less
true that in actual operation it enforces humane and considerate
treatment to employees as well as greater safety to the public."[65]

That public policy with which Mr. Roosevelt's administrations will be
most closely associated is unquestionably the conservation of natural
resources. It is true that he did not originate it or secure the
enactment of any significant legislation on the subject. The matter had
been taken up in Congress and out as early as Mr. Cleveland's first
administration, and the first important law on conservation was the act
of March 3, 1891, which authorized the President to reserve permanently
as forest lands such areas as he deemed expedient. Under this law
successive Presidents withdrew from entry enormous areas of forest
lands. This beginning Mr. Roosevelt enlarged, and by his messages and
speeches, he brought before the country in an impressive and enduring
manner the urgent necessity of abandoning the old policy of drift and of
withholding from the clutches of grasping corporations the meager domain
still left to the people. Without inquiring into what may be the wisest
final policy in the matter of our natural resources, all citizens will
doubtless agree that Mr. Roosevelt's service in this cause was valuable
beyond calculation.

Among the proudest achievements of Mr. Roosevelt's administration was
the beginning of the actual construction of the Panama Canal. A short
route between the two oceans had long been considered by the leading
commercial nations of the world. In 1850, by the Clayton-Bulwer treaty,
the United States and Great Britain had agreed upon the construction of
a canal by a private corporation, under the supervision of the two
countries and other states, which might join the combination, on a basis
of neutralization. The complete failure of the French company organized
by De Lesseps, the hero of the Suez Canal, discouraged all practical
attempts for a time, but the naval advantages of such a waterway was
forced upon public attention in a dramatic manner during the Spanish War
when the battleship _Oregon_ made her historical voyage around the
Horn.[66]

After the Spanish War was over, Mr. John Hay, Secretary of State, began
the negotiation of a new treaty with Great Britain, which, after many
hitches in the process of coming to terms, was finally ratified by the
Senate in December, 1901. This agreement, known as the Hay-Pauncefote
treaty, set aside the old Clayton-Bulwer convention, and provided that a
canal might be constructed under the supervision of the United States,
either at its own cost or by private enterprise subject to the
stipulated provisions. The United States agreed to adopt certain rules
as the basis of the neutralization of the canal, and expressly declared
that "the canal shall be free and open to the vessels of commerce and of
war of all nations, observing these Rules, on terms of entire equality,
so that there shall be no discrimination against any such nation, or its
citizens or subjects, in respect of the conditions or charges of traffic
or otherwise."[67] A proposal to forbid the fortification of the canal
was omitted from the final draft, and provision was made for "policing"
the district by the United States. The canal was thus neutralized under
a guarantee of the United States, and certain promises were made in
behalf of that country.

The exact effect of this treaty was a subject of dispute from the
outset. On the one side, it was said by Mr. Latane that "a unilateral
guarantee amounts to nothing; the effect of the Hay-Pauncefote treaty,
therefore, is to place the canal politically as well as commercially
under the absolute control of the United States."[68] On the other hand,
it was contended that this treaty superseded a mutually binding
convention, and that, although it was unilateral in character, the rules
provided in it were solemn obligations binding upon the conscience of
the American nation. Whatever may be the merits of this controversy, it
is certain that the Hay-Pauncefote agreement cleared the way for speedy
and positive action on the part of the United States with regard to the
canal.

The great question then confronting the country was where and how should
the canal be built. One party favored cutting the channel through
Nicaragua, and in fact two national commissions had reported in favor of
this route. Another party advocated taking over the old French concern
and the construction of the waterway through Panama, a district then
forming a part of Colombia. As many influential Americans had become
interested in the rights of the French company, they began a campaign in
the lobbies of Congress to secure the adoption of that route. At length
in June, 1902, the merits of the Panama case or the persistency of the
lobby, or both, carried through a law providing for the purchase of the
French company's claims at a cost of not more than $40,000,000 and the
acquisition of a canal strip from the republic of Colombia--and failing
this arrangement, the selection of the Nicaragua route.

On the basis of this law, which was signed June 28, 1902, negotiations
were begun with Colombia, but they ended in failure because that country
expected to secure better terms than those offered by the United States.
The Americans who were interested in the French concern and expected to
make millions out of the purchase of property that was substantially
worthless, were greatly distressed by the refusal of Colombia to ratify
the treaty which had been negotiated. Residents of Panama were likewise
disturbed at this delay in an enterprise which meant great prosperity
for them, and with the sympathy if not the support of the American
administration, a revolt was instigated at the Isthmus and carried out
under the protection of American arms on November 3, 1903. Three days
later, President Roosevelt recognized the independence of the new
revolutionary government. In his message in December, Mr. Roosevelt
explained the great necessity under which he labored, and convinced his
friends of the wisdom and justice of his course.

By a treaty proclaimed on February 26, 1904, between Panama and the
United States, provision was made for the construction of the canal. The
independence of the former country was guaranteed, and the latter
obtained "in perpetuity the use, occupation, and control" of a canal
zone, and the right to construct, maintain, and operate the canal and
other means of transportation through the strip. Panama was paid
$10,000,000 for her concession and promised $250,000 a year after the
lapse of nine years. The full $40,000,000 was paid over to the French
concern and its American underwriters; the lock type instead of the
sea-level canal was agreed upon in 1906; construction by private
contractors was rejected in favor of public direct employment under
official engineers; and the work was pushed forward with great rapidity
in the hope that it might be completed before 1915.

       *       *       *       *       *

The country had not settled down after the Panama affair before popular
interest was again engaged in a diplomatic tangle with Santo Domingo.
That petty republic, on account of its many revolutions, had become
deeply involved in debt, and European creditors, through their
diplomatic agents, had practically threatened the use of armed force in
collecting arrears, unless the United States would undertake the
supervision of the Dominican customs and divide the revenues in a
suitable manner. In an agreement signed in February, 1905, between the
United States and Santo Domingo, provisions were made for carrying such
an arrangement into effect. The Senate, having failed to sanction the
treaty, Mr. Roosevelt practically carried out the program unofficially
and gave it substantial support in the form of American battleships.

Against this independent executive action there was a strong protest in
the Senate. The spirit of this opposition was fully expressed by Mr.
Rayner in a speech in that chamber, in which he said: "This policy may
be all right--perhaps the American people are in favor of this new
doctrine; it may be a wonderful accomplishment--Central America may
profit by it; it may be a great benefit to us commercially and it may be
in the interest of civilization, but as a student and follower of the
Constitution, I deprecate the methods that have been adopted, and I
appeal to you to know whether we propose to sit silently by, and by our
indifference or tacit acquiescence submit to a scheme that ignores the
privileges of this body; that is not authorized by statute; that does
not array itself within any of the functions of the Executive; that
vests the treaty-making power exclusively in the President, to whom it
does not belong; that overrides the organic law of the land, and that
virtually proclaims to the country that, while the other branches of the
Government are controlled by the Constitution, the Executive is above
and beyond it, and whenever his own views or policies conflict with it,
he will find some way to effectuate his purposes uncontrolled by its
limitations."

Notwithstanding such attacks on his authority, the President had not in
fact exceeded his constitutional rights, and the boldness and directness
of his policy found plenty of popular support. The Senate was forced to
accept the situation with as good grace as possible, and a compromise
was arranged in a revised treaty in February, 1907, in which Mr.
Roosevelt's action on material points received official sanction from
that authority. The wisdom of the policy of using the American navy to
assist European and other creditors in collecting their debts in
Latin-American countries was thoroughly thrashed out, as well as the
constitutional points; and a new stage in the development of the Monroe
Doctrine was thus reached. Those who opposed the policy pointed to
another solution of the perennial difficulties arising in the countries
to the southward; that is, the submission of pecuniary claims to the
Hague Court or special tribunals for arbitration.[69]

Another very dramatic feature of Mr. Roosevelt's administration was his
action in bringing Russia and Japan together in 1905 and thus helping to
terminate the terrible war between these two powers. Among the
achievements of the Hague conference, called by the Tsar in 1899, was
the adoption of "A Convention for the Peaceful Adjustment of
International Differences" which provided for a permanent Court of
Arbitration, for international commissions of inquiry in disputes
arising from differences of opinion on facts, and for the tendering of
good offices and mediation. "The right to offer good offices or
mediation," runs the convention, "belongs to Powers who are strangers to
the dispute, even during the course of hostilities. The exercise of this
right shall never be considered by one or the other parties to the
contest as an unfriendly act."

It was under this last provision that President Roosevelt dispatched on
June 8, 1905, after making proper inquiries, identical notes to Russia
and Japan, urging them to open direct negotiations for peace with each
other. The fact that the great European financiers had already
substantially agreed that the war must end and that both combatants were
in sore straits for money, clearly facilitated the rapidity with which
the President's invitation was accepted. In his identical note, Mr.
Roosevelt tendered his services "in arranging the preliminaries as to
the time and place of meeting," and after some delay Portsmouth, New
Hampshire, was determined upon. The President's part in the opening
civilities of the conference between the representatives of the two
powers, and the successful outcome of the negotiations, combined to make
the affair, in the popular mind, one of the most brilliant achievements
of his administration.

FOOTNOTES:

     [62] See above, p. 133.

     [63] La Follette, _Autobiography_, 399 ff.

     [64] The law ordered the Interstate Commerce Commission to
     ascertain the cost of the construction of all interstate
     railways, the cost of their reconstruction at the present
     time, and also the amount of land and money contributed to
     railways by national, state, and local governments.

     [65] _Campaign Textbook, 1908_, p. 45.

     [66] See above, p. 209.

     [67] Notwithstanding this arrangement, Congress in 1912
     enacted a law exempting American coastwise vessels from canal
     tolls.

     [68] _America as a World Power_, p. 207.

     [69] Latane, _America as a World Power_, pp. 282 ff.




CHAPTER XI

THE REVIVAL OF DISSENT


On the morning of March 4, 1901, when Mr. McKinley took the oath of
office to succeed himself as President, it appeared to the superficial
observer that the Populist movement had spent its strength and
disappeared. Such was the common remark of the time. To discredit a new
proposition it was only necessary to observe that it was as dead as
Populism. Twice had the country repudiated Mr. Bryan and his works, the
second time even more emphatically than the first; and the radical ideas
which had been associated with his name, often quite erroneously, seemed
to be permanently laid to rest. The country was prosperous; it
congratulated itself on the successful outcome of the war with Spain and
accepted the imperialist policies which followed with evident
satisfaction. Industries under the protection of the Dingley Act and
undisturbed by threats of legislative interference went forward with
renewed vigor. Capital began to reach out for foreign markets and
investments as never before. Statesmen of Mr. Hanna's school looked upon
their work and pronounced it good.

But Populism was not dead. Defeated in the field of national politics,
it began to work from the ground upward, attacking one piece of
political machinery after another and pressing upon unwilling state
legislatures new forms of agrarian legislation. The People's party, at
its convention in 1896, had declared in favor of "a system of direct
legislation through the initiative and referendum, under proper
constitutional safeguards"; and Mr. Bryan two years later announced his
belief in the system, saying: "The principle of the initiative and
referendum is democratic. It will not be opposed by any Democrat who
indorses the declaration of Jefferson that the people are capable of
self-government; nor will it be opposed by any Republican who holds to
Lincoln's idea that this should be a government of the people, by the
people, and for the people."[70]

The first victory of "direct democracy" came in the very year of Mr.
Bryan's memorable defeat. In 1896, the legislature of South Dakota was
captured by a Democratic-Populist majority, and at the session beginning
in the following January, it passed an amendment to the state
constitution, establishing a system of initiative and referendum. Some
leaders of the old Knights of Labor and the president of the Farmers'
Alliance were prominently identified with the campaign for this
innovation. The resolution was "passed by a strict party vote, and to
the Populists is due the credit of passing it," reported "The Direct
Legislation Record" in June, 1897. In the contest over ratification at
the polls a party division ensued. The Democratic state convention in
1898 adopted a plank favoring direct legislation, on "the principle that
the people should rule"; and the Republicans contented themselves with
urging party members "to study the legislative initiative and
referendum." At the ensuing election the amendment was carried by a vote
of 23,876 to 16,483; but ten years elapsed before any use was made of
the new device.[71]

A cloud no bigger than a man's hand had appeared on the horizon of
representative government. East, West, North, and South, advocates of
direct government were busy with their propaganda, Populists and
Democrats taking the lead, with Republican politicians not far in the
rear. The year following the adoption of the South Dakota amendment a
combination of Democrats and Populists carried a similar provision
through the state legislature of Utah and obtained its ratification in
1900. This victory was a short-lived triumph, for the Republicans soon
regained their ascendancy and stopped the progress of direct legislation
by refusing to enact the enabling law putting the amendment into force.
But this check in Utah did not dampen the ardor of reformers in other
commonwealths. In 1902, Oregon adopted the new system; four years later
Montana followed; in 1907, Oklahoma came into the Union with the device
embodied in the Constitution; and then the progress of the movement
became remarkably rapid. It was adopted by Missouri and Maine in 1908,
Arkansas and Colorado in 1910, Arizona and California in 1911,
Washington, Nebraska, Idaho, and Ohio in 1912. By this time Populists
and Democrats had ceased to monopolize the agitation for direct
government; it had become respectable, even in somewhat conservative
Republican circles.

It should be pointed out, however, that there is a conservative and a
radical system of initiative and referendum: one which fixes the
percentage necessary to initiate and adopt a measure at a point so high
as to prevent its actual operation, and another which places it so low
as to make its frequent use feasible. The older and more radical group
of propagandists, finding their general scheme so widely taken up in
practical politics, soon began to devote their attention rather to
attacking the stricter safeguards thrown up by those who gave their
support to direct government in theory only.

In its simple form of initiation by five per cent of the voters and
adoption by a majority of those voting on the measure submitted, this
new device was undoubtedly a revolutionary change from the American
system of government as conceived by the framers of the Constitution of
the United States--with its checks and balances, indirect elections, and
judicial control over legislation. The more radical of the advocates of
direct government frankly admitted that this was true, and they sought
to strengthen this very feature of their system by the addition of
another device, known as the recall, which, when applied to judges as
well as other elective officers, reduced judicial control over
legislation to a practical nullity. Where judges are elected for short
terms by popular vote and made subject to the recall, and where laws
are made by popular vote of the same electors who choose the judges, it
is obvious that the very foundations of judicial supremacy are
undermined.

The recall, like direct democracy, was not new to American politics.
Both were understood, at least in principle, by the framers of the
Federal Constitution and rejected decisively. The recall seems to have
made its appearance first in local form,--in the charter of Los Angeles,
adopted in 1903. From there it went to the Seattle charter of 1906, and
two years later it was adopted as a state-wide system applicable to all
elective officers by Oregon. Its progress was swiftest in municipal
affairs, for it quite generally accompanied "the commission form" of
city government as a check on the commissioners in their exercise of
enlarged powers.

The state-wide recall, however, received a remarkable impetus in 1911
from the controversy over the admission of Arizona, which attracted the
attention of the nation. That territory had framed a constitution
containing a radical form of the recall based on the Oregon plan, and in
August, 1911, Congress passed a resolution admitting the applicant, on
condition that the provision relating to the recall should be
specifically submitted to the voters for their approval or rejection.
President Taft was at once stirred to action, and on August 15 he sent
Congress a ringing message, displaying unwonted vigor and determination,
vetoing the resolution and denouncing the recall of judges in unmeasured
terms. "Constitutions," he said, "are checks upon the hasty action of
the majority. They are the self-imposed restraints of a whole people
upon a majority of them to secure sober action and a respect for the
rights of the minority.... In order to maintain the rights of the
minority and the individual and to preserve our constitutional balance
we must have judges with courage to decide against the majority when
justice and law require.... As the possibilities of such a system [as
the recall] pass in review, is it too much to characterize it as one
which will destroy the judiciary, its standing, and its usefulness?"

Acting upon the recommendation of President Taft, Congress passed a
substitute resolution for admitting Arizona only on condition that the
obnoxious recall of judges be stricken from the constitution of the
state.[72] The debates in Congress over the admission of Arizona covered
the whole subject of direct government in all its aspects, and these,
coupled with the President's veto message, brought the issue prominently
to the front throughout the country. Voters to whom it had previously
been an obscure western device now began to take a deep interest in it;
the press took it up; and one more test for "progressive" and
"reactionary" was put in the popular program.

       *       *       *       *       *

The movement for direct popular participation in state and local
government was inevitably accompanied by a demand for more direct
government within the political party; in other words, by a demand for
the abandonment of the representative convention in favor of the
selection of candidates by direct primary. During the decade of the
great Populist upheaval, legislation relative to political parties was
largely confined to the introduction of the Australian ballot and the
establishment of safeguards around the primaries at which delegates to
party conventions were chosen. The direct primary, like the initiative
and referendum, grew out of a discontent with social and economic
conditions, which led to an attack on the political machinery that was
alleged to be responsible for them. Like the initiative and referendum,
also, it was not an altogether new device, for it had been used for a
long time in some of the states as a local institution established by
party custom; but when it was taken up by the state legislatures, it
made a far more rapid advance.

It was not, however, until the opening of the new century that primary
legislation began to engross a large share of legislative activities. In
1903, "the first state-wide primary law with fairly complete provisions
for legal supervision was enacted by the state of Wisconsin"; Oregon,
making use of the new initiative system, enacted a thoroughgoing primary
law in 1904; and the following year Illinois adopted a state-wide
measure. Other states, hesitating at such an extensive application of
the principle, contented themselves at first with laws instituting local
primaries, such, for example, as the Nebraska law of 1905 covering
cities of over 125,000, or the earlier law of Minnesota covering only
Hennepin county. "So rapid was the progress of public opinion and
legislation," says Mr. Merriam, "that in many instances a compromise law
of one session of the legislature was followed by a thoroughgoing law
in the next. For example, the North Dakota law of 1905 authorized direct
primaries for all district nominations, but did not include state
offices; but in 1907, a sweeping act was passed covering practically all
offices."

The vogue of the direct primary was confined largely to the West at
first, but it steadily gained in favor in the East. Governor Hughes, of
New York, in his contest with the old organization of the Republican
party, became a stanch advocate of the system, recommended it to the
legislature in his messages, campaigned through the state to create
public sentiment in favor of the reform, and labored unsuccessfully to
secure the passage of a primary law, until he closed his term to accept
an appointment to the Supreme Court of the United States. In 1911, the
Democratic party, which had carried New York state at the preceding
election, enacted a primary law applicable to local, but not to state,
offices. About the same time Massachusetts, Maine, and New Jersey joined
the long list of direct primary states. Within almost ten years the
principle in its state-wide form had been accepted in two thirds of the
states, and in some local form in nearly all of the other commonwealths.

       *       *       *       *       *

Meanwhile, the theory and practice of direct government made their way
upward into the Federal government. As early as 1826, Mr. Storrs, a
representative from New York, introduced in the House a constitutional
amendment providing for the popular election of United States Senators,
and from time to time thereafter the proposal was urged upon Congress.
President Johnson, who had long been an advocate of this change in the
Federal government, made it the subject of a special message to Congress
in 1868; but in his contest with that body the proposed measure was lost
to sight. Not long afterward it appeared again in the House and the
Senate, and at length the lower house in 1893 passed an amendment
providing for popular election by the requisite two-thirds vote, but the
Senate refused to act. Again in 1894, in 1898 (by a vote of 185 to 11),
in 1900 (240 to 15), and in 1902 by practically a unanimous vote, there
being no division, the House passed the amendment; still the Senate
resisted the change.

In the Senate itself were found occasional champions of popular
election, principally from the West and South. Mitchell, of Oregon,
Turpie, of Indiana, Perkins, of California, Berry, of Arkansas, and
Bailey, of Texas, took the leadership in this contest for reform.
Chandler, of New Hampshire, Depew, of New York, Penrose, of
Pennsylvania, Hoar, of Massachusetts, Foraker, of Ohio, and Spooner, of
Wisconsin, leveled their batteries against it. State after state
legislature passed resolutions demanding the change, until at length
three fourths had signified their demand for popular election.

The Senate as a whole remained obdurate. When in the Fifty-third
Congress the resolution of the House came before that body, Mr. Hoar, of
Massachusetts, made, on April 6 and 7, 1893, one of his most eloquent
and impassioned pleas for resisting this new proposal to the uttermost.
He declared that it would transfer the seat of power to the "great
cities and masses of population," that it would create new temptations
to fraud and corrupt practices, that it implied that the Senate had been
untrue to its trust, that it would lead to the election of the President
and the judiciary by popular majorities, and that it would "result in
the overthrow of the whole scheme of the Senate and in the end of the
whole scheme of the national Constitution as designed and established by
the framers of the Constitution and the people who adopted it." With
impatience, he refused to listen to the general indictment which had
been brought against the Senate as then constituted. "The greatest
victories of constitutional liberty since the world began," he
concluded, "are those whose battle ground has been the American Senate,
and whose champions have been the Senators who for a hundred years,
while they have resisted the popular passions of the House, have led,
represented, guided, obeyed, and made effective the deliberate will of a
free people."

Having failed to make an impression on the Senate by a frontal attack,
the advocates of popular election set to work to capture that citadel by
a rear assault. They began to apply the principle of the direct primary
in the nomination of candidates for the Senate, and this development at
length culminated in the Oregon scheme for binding the legislature to
accept the "people's choice." This movement gained rapid headway in the
South, where the real contest was over nomination, not election, on
account of the absence of party divisions. As early as 1875, the
Nebraska constitution had provided for taking a popular preferential
vote on candidates for the Senate; but no considerable interest seems
to have been taken in it at the time. In 1899, Nevada passed a law
entitled "an act to secure the election of United States Senators in
accordance with the will of the people and the choice of the electors of
the state." Shortly afterward, Oregon enacted her famous statute which
attempted to compel the legislature to accept the popular nominee; and
from that time forward the new system spread rapidly. By 1910, at least
three fourths of the states nominated candidates for the Senate by some
kind of a popular primary.

It was not until 1911 that the Senate yielded to the overwhelming
popular demand for a change in the methods of election provided in the
Constitution. In December, 1909, Senator Bristow, of Kansas, introduced
a resolution designed to effect this reform, and after a hot debate it
was defeated on February 28, 1911, by a vote of 54 to 33, four short of
the requisite two thirds. In the next Congress, which convened on April
4, ten Senators who had voted against the amendment had been retired,
and the champions of the measure, taking it up again with renewed
energy, were able to force it through the upper house on June 12, 1911,
by a margin of five more than the two thirds. The resolution went to the
House and a deadlock arose between the two chambers for a time over
Federal control of elections, provided in the Senate resolution, which
was obnoxious to many southern representatives. At length, however, on
May 13, 1912, the opponents in the House gave way, and the resolution
passed by an overwhelming vote. Within a year, the resolution was
ratified by the requisite three fourths of the state legislatures, and
it was proclaimed on May 31, 1913.

       *       *       *       *       *

The advance of direct democracy in the West was accompanied by a revival
of the question of woman suffrage. That subject had been earnestly
agitated about the time of the Civil War; and under the leadership of
Elizabeth Cady Stanton, Susan B. Anthony, and others it made
considerable headway among those sections of the population which had
favored the emancipation of the slaves. Indeed, it was inevitably linked
with the discussion of "natural rights," extensively carried on during
the days when attempts were being made to give political rights to the
newly emancipated bondmen. Woman suffrage was warmly urged before the
New York state constitutional convention in 1867 by Mr. George William
Curtis, in a speech which has become a classic among the arguments for
that cause. During the seventies suffrage petitions bearing the
signatures of thousands of men and women were laid before Congress, and
an attempt was made to secure from the Supreme Court an interpretation
of the Fourteenth Amendment which would force the states to grant the
ballot to women.

At length the movement began to subside, and writers who passed for keen
observers declared it to be at an end. The nineteenth century closed
with victories for the women in only four states, Wyoming, Colorado,
Utah, and Idaho. The first of these states had granted the vote to women
while yet a territory, and on its admission to the Union in 1890, it
became the first state with full political equality. Three years later,
Colorado enfranchised women, and in 1896 Utah and Idaho joined the equal
suffrage commonwealths. Meanwhile, a very large number of northern and
eastern states had given women the right to vote in local or school
elections, Minnesota and Michigan in 1875 and other states in quick
succession. Nevertheless, these gains were, relatively speaking, small,
and there seemed to be little widespread enthusiasm about the further
extension of the right.

Of course, the agitation continued, but in somewhat obscure circles,
under a running fire of ridicule whenever it appeared in public. At
length it broke out with unprecedented vigor, shortly after the tactics
adopted by militant English women startled the world. Within a short
time new and substantial victories gave the movement a standing which
could not be ignored either by its positive opponents or the indifferent
politicians. In 1910, the suffragists carried the state of Washington;
in 1911, they carried California; in 1912, they won in Arizona, Kansas,
and Oregon; but lost Ohio, Michigan, and Wisconsin. These victories gave
them nine states and of course a considerable influence in the House of
Representatives and the right to participate in the election of eighteen
out of ninety-six Senators. But the defeat in the three middle states
led the opponents of woman suffrage to believe that the movement could
be confined to the far West. This hope was, however, dashed in 1913 when
the legislature of Illinois gave women the right to vote for all
statutory officers, including electors for President of the United
States. Determined to make use of the political power thus obtained,
the suffragists, under the leadership of Alice Paul, renewed with great
vigor the agitation at Washington for a national amendment forbidding
states to disqualify women from voting merely on account of sex.


_The Rise and Growth of Socialism_

With the spread of direct elections and the initiative and referendum,
and the adoption of the two amendments to the Federal Constitution
authorizing an income tax[73] and the popular election of Senators, the
milder demands of Populism were secured. At the same time, the
prosperity of the farmers and the enormous rise in ground values which
accompanied the economic advance of the country removed some of the most
potent causes of the discontent on which Populism thrived. Organized
Populism died a natural death. Those Populists who advocated only
political reforms went over to the Republican and Democratic parties;
the advocates of radical economic changes, on the other hand, entered
the Socialist ranks.

Socialism, as an organized movement in the United States, runs back to
the foundation of the Social-Democratic Workingmen's party in New York
City, in 1874, which was changed into the Socialist Labor party three
years later,--a party that still survives. This group did not enter into
national politics until 1892, although its branches occasionally made
nominations for local offices or fused with other labor groups, as in
the New York mayoralty campaign of 1886. In its vigorous propaganda
against capitalism, this party soon came into collision with the
American Federation of Labor, established in 1886, and definitely broke
with it four years later when the latter withheld a charter from the New
York Central Federation for the alleged reason that the Socialist Labor
party of that city was an affiliated organization. After the break with
the American Federation, this Socialist group turned for a time to the
more radical Knights of Labor, but this new flirtation with labor was no
more successful than the first, and in time the Socialist Labor party
declared war on all the methods of American trades-unionism. Its gains
numerically were not very significant; it polled something over twenty
thousand votes in 1892 and over eighty thousand in 1896--the high-water
mark in its political career. Its history has been a stormy one, marked
by dissensions, personal controversies, and splits, but the party is
still maintained by a decreasing band of loyal adherents.

The growth of interest in socialism, however, was by no means confined
to the membership of the Socialist Labor party. External events were
stirring a consciousness that grave labor problems had arisen within the
American Commonwealth. The bloody strikes at Homestead, Coeur d'Alene,
Buffalo, and Pullman in the eighties and early nineties moved the
country as no preachments of abstract socialist philosophy could ever
have done. That such social conflicts were full of serious portent was
recognized even by such a remote and conservative thinker as President
Cleveland in his message of 1886 to Congress. In that very year, the
Society of Christian Socialists was formed, with Professor R. T. Ely and
Professor G. D. Herron among its members, and about the same time
"Nationalist" clubs were springing up all over the country as a result
of the propaganda created by Bellamy's _Looking Backward_, published in
1887. The decline of the Populist party, which had indorsed most of the
socialistic proposals that appealed to Americans tinged with radicalism,
the formation of local labor and socialist societies of one kind or
another, and the creation of dissatisfaction with the methods and
program of the Socialist Labor party finally led to the establishment of
a new national political organization.

This was effected in 1900 when a general fusion was attempted under the
name of the Social Democratic party, which nominated Mr. Eugene V. Debs
for President at a convention held in Indianapolis. The Socialist Labor
party, however, declined to join the organization and went on its own
way. The vote of the new party, ninety-six thousand, induced the leaders
in the movement to believe that they were on the right track, for this
was considerably larger than the rival group had ever secured. Steps
were immediately taken to put the party on a permanent basis; the name
Socialist party was assumed in 1901; local branches were established in
all sections of the country with astonishing rapidity; and a vigorous
propaganda was undertaken. In the national election of 1904 over four
hundred thousand votes were polled; in 1908, when Mr. Bryan and Mr.
Roosevelt gave a radical tinge to the older parties, a gain of only
about twenty-five thousand was made; but in 1912, despite Mr. Wilson's
flirtation with western democracy and the candidacy of Mr. Roosevelt on
a socialistic platform, the Socialist party more than doubled its vote.

During these years of growth the party began to pass from the stage of
propaganda to that of action. In 1910, the Socialists of Milwaukee
carried the city, secured twelve members of the lower house of the state
legislature, elected two state Senators, and returned Mr. Victor Berger
to Congress. This victory, which was hailed as a turning point in the
march of socialism, was largely due, however, to the divided condition
of the opposition, and thus the Socialists really went in as a
plurality, not a majority party. The closing of the Republican and
Democratic ranks in 1912 resulted in the ousting of the Socialist city
administration, although the party polled a vote considerably larger
than that cast two years previously. In other parts of the country
numerous municipal and local officers were elected by the Socialists,
and in 1912 they could boast of several hundred public offices.[74]

While there was no little difference of opinion among the Socialists as
to the precise character of their principles and tactics,--a condition
not peculiar to that party,--there were certain general ideas running
through their propaganda and platforms. Modern industry, they all held,
creates necessarily a division of society into a relatively few
capitalists, on the one hand, who own, control, and manipulate the
machinery of production and the natural resources of the country, and
on the other hand, a great mass of landless, toolless, and homeless
working people dependent upon the sale of their labor for a livelihood.
There is an inherent antagonism between these two classes, for each
seeks to secure all that it can from the annual output of wealth; this
antagonism is manifest in labor organizations, strikes, and industrial
disputes of every kind. Out of this contest, the former class gains
wealth, luxury, safety, and the latter, poverty, slums, and misery.
Finally, if the annual toll levied upon industry by the exploiters and
the frightful wastes due to competition and maladjustment were
eliminated, all who labor with hand or brain could enjoy reasonable
comfort and security, and also leisure for the cultivation of the nobler
arts of civilization.

At the present time, runs the Socialist platform of 1912, "the
capitalist class, though few in numbers, absolutely controls the
government--legislative, executive, and judicial. This class owns the
machinery of gathering and disseminating news through its organized
press. It subsidizes seats of learning,--the colleges and the
schools,--even religious and moral agencies. It has also the added
prestige which established customs give to any order of society, right
or wrong." But the working class is becoming more and more discontented
with its lot; it is becoming consolidated by cooperation, political and
economic, and in the future it will become the ruling class of the
country, taking possession, through the machinery of the government, of
the great instrumentalities of production and distribution. This final
achievement of socialism is being prepared by the swift and inevitable
consolidation of the great industries into corporations, managed by paid
agents for the owners of the stocks and bonds. The transition from the
present order will take the form of municipal, state, and national
assumption of the various instrumentalities of production and
distribution--with or without compensation to the present owners, as
circumstances may dictate.[75] Such are the general presuppositions of
socialism.

The Socialist party had scarcely got under way before it was attacked
from an unexpected quarter by revolutionary trade-unionists, known as
the Industrial Workers of the World, who revived in part the old
principle of class solidarity (as opposed to trade solidarity) which lay
at the basis of the Knights of Labor. The leaders of this new unionism,
among whom Mr. W. D. Haywood was prominent, did not repudiate altogether
the Socialist labors to secure control of the organs of government by
the ballot, but they minimized their importance and pressed to the front
the doctrine that by vigorous and uncompromising mass strikes a
revolutionary spirit might be roused in the working class and the actual
control of business wrested from the capitalists, perhaps without the
intervention of the government at all.

This new unionism was launched at a conference of radical labor leaders
in 1904, at which the following program was adopted: "The working class
and the employing class have nothing in common. Between these two
classes a struggle must go on until the workers of the world organize as
a class, take possession of the earth and machinery of production and
abolish the wage system. We find that the centering of the management of
industries into fewer and fewer hands makes the trade unions unable to
cope with the ever growing power of the employing class. The trade
unions foster a state of affairs which allows one set of workers to be
pitted against another set of workers in the same industry.... Moreover
the trade unions aid the employing class to mislead the workers into the
belief that the working class have interests in common with their
employers. These conditions can be changed and the interest of the
working class upheld only by an organization formed in such a way that
all its members in any one industry, or in all industries if necessary,
cease work whenever a strike or a lockout is on in any department
thereof.... We must inscribe on our banner the revolutionary watchword,
'Abolish the wage system.'"

This new society made a disturbance in labor circles entirely out of
proportion to its numerical strength. Its leaders managed strikes at
McKees Rocks, Pennsylvania, at Lawrence, Massachusetts, in 1912, and at
other points, laying emphasis on the united action of all the working
people of all the trades involved in the particular industry. The "new
unionism" appealed particularly to the great mass of foreign laborers
who had no vote and therefore perhaps turned with more zeal to "direct"
action. It appeared, however, that the membership of the Industrial
Workers was not over 70,000 in 1912, and that it had little of the
stability of the membership of the old unions.

What the effect of this new unionism will be on the Socialist party
remains to be seen. That party at its convention in 1912 went on record
against the violent tactics of revolutionary unionism, and by a party
vote "recalled" Mr. Haywood from his membership on the executive
committee. The appearance of this more menacing type of working-class
action and the refusal of the Socialist party to accept it with open
arms gave a new turn to the attitude of the conservative press toward
regular political socialism of the strict Marxian school.


_The Counter-Reformation_

Just as the Protestant Revolt during the sixteenth century was followed
by a counter-reformation in the Catholic Church which swept away many
abuses, while retaining and fortifying the essential principles of the
faith, so the widespread and radical discontent of the working classes
with the capitalist system hitherto obtaining produced a
counter-reformation on the part of those who wish to preserve its
essentials while curtailing some of its excesses. This counter-reformation
impress upon American political thinking and made a deep legislation at
the turning of the new century. More than once during his presidency Mr.
Roosevelt warned the capitalists that a reform of abuses was the price
which they would have to pay in order to save themselves from a socialist
revolution. Eminent economists turned aside from free trade and _laissez
faire_ to consider some of the grievances of the working class, and many
abandoned the time-honored discussions of "economic theories," in favor
of legislative programs embracing the principles of state socialism, to
which countries like Germany and Great Britain were already committed.

Charity workers whose function had been hitherto to gather up the wrecks
of civilization and smooth their dying days began to talk of "a war for
the prevention of poverty," and an examination of their concrete
legislation proposals revealed the acceptance of some of the principles
of state socialism. Unrestricted competition and private property had
produced a mass of poverty and wretchedness in the great cities which
constituted a growing menace to society, and furnished themes for
socialist orators. Social workers of every kind began the detailed
analysis of the causes of specific cases of poverty and arrived at the
conclusion that elaborate programs of "social legislation" were
necessary to the elimination of a vast mass of undeserved poverty.

Under the stimulus of these and other forces, state legislatures in the
more industrially advanced commonwealths began to pour out a stream of
laws dealing with social problems. These measures included employers'
liability and workmen's compensation laws, the prohibition of child
labor, minimum hours for dangerous trades like mining and railroading,
minimum wages for women and girls, employment bureaus, and pensions for
widows with children to support. While none of the states went so far
as to establish old-age pensions and general sickness and accident
insurance, it was apparent from an examination of the legislation of the
first decade of the twentieth century that they were well in the paths
of nations like Germany, England, and Australia.


_Criticism of the Federal System_

All this unsettlement in economics and politics could not fail to bring
about a reconsideration of the fundamentals in the American
constitutional system--particularly the distribution of powers between
the Federal and state governments, which is made by a constitution
drafted when economic conditions were totally different from what they
are to-day. In fact, during the closing years of the nineteenth century
there appeared, here and there in American political literature,
evidence of a discontent with the Federal system scarcely less keen and
critical than that which was manifested with the Articles of
Confederation during those years of our history which John Fiske has
denominated "The Critical Period."

Manufacturing interests which, at the time the Federal Constitution was
framed, were so local in character as to be excluded entirely from the
control of the Federal government had now become national or at all
events sectional, having absolutely no relation to state lines. As
Professor Leacock remarks, "The central fact of the situation is that
economically and industrially the United States is one country or at
best one country with four or five great subdivisions, while politically
it is broken into a division of jurisdictions holding sway to a great
extent over its economic life, but corresponding to no real division
either of race, of history, of unity, of settlement, or of commercial
interest."[76] For example, in 1900 the boot and shoe industry, instead
of being liberally distributed among the several states, was so
concentrated, that out of the total product 44.9 per cent was produced
by Massachusetts; nearly one half of the agricultural implements for
that year were made in Illinois; two thirds of the glass of the whole
country was made in Pennsylvania and Indiana; while Pennsylvania alone
produced 54 per cent of the iron and steel manufactured. The political
significance of this situation was simply this: the nation on which each
of these specialized industries depended for its existence had
practically no power through the national government to legislate
relative to them; but in each case a single legislature representing a
small fraction of the people connected with the industry in question
possesses the power of control.

The tendency of manufacturers to centralize was accompanied, as has been
pointed out above, by a similar centralization in railways. At the close
of the nineteenth century, the Vanderbilt system operated "some 20,000
miles reaching from New York City to Casper, Wyoming, and covering the
lake states and the area of the upper Mississippi; the Pennsylvania
system with 14,000 miles covers a portion of the same territory,
centering particularly in Ohio and Indiana; the Morgan system,
operating 12,000 miles, covers the Atlantic seaboard and the interior of
the Southern States from New York to New Orleans; the Morgan-Hill system
operates 20,000 miles from Chicago and St. Louis to the state of
Washington; the Harriman system with 19,000 miles runs from Chicago
southward to the Gulf and westward to San Francisco, including a
Southern route from New Orleans to Los Angeles; the Gould system with
14,000 miles operates chiefly in the center of the middle west extending
southward to the Gulf; in addition to these great systems are a group of
minor combinations such as the Atchinson with 7,500 or the Boston and
Maine with 3,300 miles of road."

Corresponding to this centralization in industries and railways there
was, as we have pointed out, a centralization in the control of capital,
particularly in two large groups, the Standard Oil and the Morgan
interests. As an expert financier, Mr. Moody wrote in 1904: "Viewed as a
whole, we find the dominating influences in the trusts to be made up of
an intricate network of large and small groups of capitalists, many
allied to one another by ties of more or less importance, but all being
appendages to, or parties of the greater groups which are themselves
dependent on and allied with the two mammoth or Rockefeller and Morgan
groups."

       *       *       *       *       *

Facing this centralized national economy was a Federal system made for
wholly different conditions--a national system of manufacturing,
transportation, capital, and organized labor, with a national government
empowered, expressly, at least, to regulate only one of those
interests, transportation--the other fundamental national interests
being referred to the mercy of forty-six separate and independent state
legislatures. But it is to be noted, these several legislatures were by
no means free to work out their own program of legislation; all of them
were, at every point, subjected to Federal judicial control under the
general phrases of the Fourteenth Amendment relative to due process of
law and the equal protection of the laws.[77] To state it in another
way, the national government was powerless to act freely with regard to
nearly all of the great national interests, but it was all powerful
through its judiciary in striking down state legislation.

A few concrete illustrations[78] will show the lack of correspondence
between the political system and the economic system. Each state bids
against the others to increase the number of factories which adds to its
wealth and increases the value of property within its borders, although
it makes no difference to the total wealth of the nation and the
happiness of the whole people whether a particular concern is located in
New Jersey or in Pennsylvania. As the national government enjoys no
power to regulate industries--even those which are national in
character--the states use their respective powers under the pressure
which comes from those who are interested in increasing the industry of
the commonwealth. For example, it is stated "the glass workers of New
Jersey oppose any attempt to prohibit night work for boys under sixteen
years of age on the ground that such work is permitted in the
neighboring state of Pennsylvania." In 1907, in South Carolina, Georgia,
and Alabama, a ten year old child could, under the law, work for twelve
hours a day; North Carolina had sixty-six mills where twelve year old
children could do twelve hours' night work under the law. Although this
situation was somewhat remedied later, the advocates of reform were
resisted at every point by the interested parties who contended that in
competing with New England, the southern states had to take advantage of
every opportunity, even at the expense of the children.

The situation may be described in the language of the chief factory
inspector of Ohio: "Industrially as well as geographically we of the
Ohio Valley are one people and our laws should be uniform, not only that
they may be the easier enforced, but in justice to the manufacturers who
pursue the same industry in the several states and therefore come into
close competition with one another." Moreover, if a state enacts an
important industrial law, it may find its work in vain as the result of
a decision of the national Supreme Court, or of the state courts,
interpreting the Fourteenth Amendment.

Another example of a national interest which is wholly beyond the reach
of the Federal government, under a judicial decision reached in the case
of Paul _v._ Virginia in 1868, is that of insurance. Although Hamilton
and earlier writers on the Constitution believed that the insurance
business was a branch of interstate commerce whose regulation was vested
in Congress, the Supreme Court in this case dealing with fire insurance
declared that the act of issuing a policy of insurance was not a
transaction of commerce. "The policies," said the Court, "are simple
contracts of indemnity against loss by fire, entered into between the
corporations and the assured for a consideration paid by the latter.
These contracts are not articles of commerce in any proper meaning of
the word; they are not subjects of trade and barter offered in the
market as something having an existence and value independent of the
parties to them.... Such contracts are not interstate transactions,
though the parties may be domiciled in different states.... They are
then local transactions and are governed by the local laws. They do not
constitute a part of the commerce between the states any more than a
contract for the purchase and sale of goods in Virginia by a citizen of
New York whilst in Virginia would constitute a portion of such
commerce."

As a result of this narrow interpretation of the commerce clause, the
vast insurance business of the country, national in character, was put
beyond the reach of Congress, and at the mercy of the legislatures of
the several commonwealths. Under these circumstances, the insurance laws
of the United States were in splendid chaos. "If a compilation of these
laws were attempted," says Mr. Huebner, "a most curious spectacle would
result. It would be found that fifty-two states and territories are all
acting along independent lines and that each, as has been correctly
said, possessed its own schedule of taxations, fees, fines, penalties,
obligations and prohibitions, and a retaliatory or reciprocal provision
enabled it to meet the highest charges any other state may require of
the companies of any other states."

A still better example of confusion in our system is offered by the
corporation laws of the several states. Great industrial corporations
are formed under state laws. While many contend that Congress has the
power to compel the Federal incorporation of all concerns doing an
interstate business and thus to occupy the whole domain of corporation
law involving interstate commerce, this radical step has not yet been
taken. Congress has confined itself to the more or less fruitless task
of forbidding combinations in restraint of interstate trade.

Under these circumstances, there appeared the anomalous condition of
states actually advertising in the newspapers and bidding against each
other in offering the corporations special opportunities and low fees
for the privilege of incorporating. If the conscience of one state
became enlightened and a strict corporation law was enacted, the result
was simply to drive the irregular concerns into some other state which
was willing to sell its privileges for the small fee of incorporation,
and ask no questions. As might have been expected, every variety of
practice existed in the forty-eight jurisdictions in which corporations
might be located.

Not only was there the greatest diversity in these practices, but
special discriminations were often made in particular states against
concerns incorporated in other states; and on top of all this there was
a vast mass of anti-trust legislation, frequently drastic in character
or loose and futile. Often it was the product of a popular clamor
against large business undertakings, and often it was the result of the
effort of legislators to "strike" at corporations. Whatever the
underlying motive, it was generally characterized at the outset by lack
of uniformity and absence of any large view of public policy, and then
it was glossed over by judicial decisions, state and Federal, until it
was a fortunate corporation official, indeed, who knew either his rights
or his duties under the law. Moreover, it was a particularly obtuse
attorney who could not lead his client unscathed through this wonderland
of legal confusion.

The position of railway corporations, if possible, was more anomalous
still. Their interstate business was subject to the regulations of
Congress and their intra-state business to the control of the state
legislatures. Although there existed, in theory, a dividing line between
these two classes of business, there were always arising concrete cases
where it was difficult to say on which side of the line they would fall
in the opinion of the Supreme Court. States were constantly being
enjoined on the application of the railways for their "interference with
interstate commerce"; and when far-reaching legislation was proposed in
Congress, the cry went up that the rights of states were being trampled
upon. If X shipped a carload of goods to Y within the borders of his
state, he paid one rate; if he shipped it to Z, two miles farther on in
another state, he paid a different rate, perhaps less than in the first
instance. In a number of states companies owning parallel lines might
consolidate; in others, consolidation was forbidden. According to a
report of the Interstate Commerce Commission in 1902, the states were
equally divided on this proposition as to the consolidation of
competing lines. According to the same report, if a railway company was
guilty of unjust discrimination in one state, it paid a fine of $50, and
in other states it was mulcted to the tune of $25,000. At the same time,
whoever obstructed a railway track in Mississippi was liable to three
months in jail; for the same offense in New York he might get three
years; if, perchance, after serving three years and three months in
these two commonwealths, he tried the experiment again in Wyoming, he
might in the mercy of the court be sentenced to death.

A further element of confusion was added by the intervention of the
Federal judiciary in declaring state laws invalid, not merely when they
conflicted clearly with the execution of Federal law, but on
constitutional grounds which meant, for practical purposes, whenever the
said laws were not in harmony with the ideas of public policy
entertained by the courts at the time. The Federal judiciary in regard
to state legislation relative to corporations was, therefore, a
destructive, not a constructive, body. To use the language of the
street, state legislation was simply "shot to pieces" by judicial
decisions. That which was chaotic, disjointed, and founded upon no
uniformity of purpose or policy to begin with was riddled and torn by a
body which had no power for positive action.

As the Interstate Commerce Commission declared in 1903, "One of the
chief embarrassments in the exercise of adequate government control over
the organization, the construction, and the administration of railways
in the United States is found in the many sources of statutory
authority recognized by our form of government. The Federal Constitution
provides for uniformity in statutory control, so far as interstate
commerce is concerned, but it does not touch commerce within the states,
nor, as at present interpreted, does it cover the organization of
railroad corporations or the construction of railroad properties. These
matters, as well as the larger part of that class of activities included
under the police jurisdiction, are left to the states. Such being the
case, the development of an harmonious and uniform railroad system must
be attained, if at all, by one of two methods. The states must
relinquish to the Federal government their reserved rights over internal
commerce, or having first agreed upon fundamental principles, they must,
through comity and convention, work out an harmonious system of
statutory regulation."

       *       *       *       *       *

This was the situation that called forth the demand for the national
regulation of large corporate enterprises, and brought about the demand
for a strengthening of the Federal government, either by a
constitutional amendment or judicial interpretation, which received the
name of "New Nationalism." Wide currency was given to this term by Mr.
Roosevelt, in his speech delivered at Ossawatomie on August 31, 1910.
After outlining a legislative policy which he deemed to be demanded by
the changed economic conditions of our time, Mr. Roosevelt attacked the
idea of "a neutral zone between the national and state legislatures,"
guarded only by the Federal judiciary; and pleaded for the
strengthening of the Federal government so as to make it competent for
every national purpose.

"There must remain no neutral ground," he said, "to serve as a refuge
for lawbreakers, and especially for lawbreakers of great wealth, who can
hire the vulpine legal cunning which will teach them how to avoid both
jurisdictions. It is a misfortune when the national legislature fails to
do its duty in providing a national remedy so that the only national
activity is the purely negative activity of the judiciary in forbidding
the state to exercise the power in the premises.

"I do not ask for overcentralization; but I do ask that we work in a
spirit of broad and far-reaching nationalism when we work for what
concerns our people as a whole. We are all Americans. Our common
interests are as broad as the continent. I speak to you here exactly as
I would speak in New York or Georgia, for the most vital problems are
those which affect us all alike. The national government belongs to the
whole American people, and where the whole American people are
interested, that interest can be guarded effectively only by the
national government. The betterment which we seek must be accomplished,
I believe, mainly through the national government.

"The American people are right in demanding that New Nationalism without
which we cannot hope to deal with new problems. The New Nationalism puts
the national need before sectional or personal advantages. It is
impatient of the utter confusion that results from local legislatures
attempting to treat national issues as local issues. It is still more
impatient of the impotence which springs from overdivision of
government powers, the impotence which makes it impossible for local
selfishness or for legal cunning, hired by wealthy special interests, to
bring national activities to a deadlock. This New Nationalism regards
the executive power as the steward of the public welfare. It demands of
the judiciary that it shall be interested primarily in human welfare
rather than in property, just as it demands that the representative body
shall represent all the people rather than any one class or section of
the people."

FOOTNOTES:

     [70] The political history of the initiative and referendum
     has never been written. Some valuable materials are to be
     found in _Direct Legislation_, Senate Document No. 340, 55th
     Cong., 2d Sess. (1898); and in "The Direct Legislation
     Record," founded in May, 1894; and in the "Equity Series,"
     now published at Philadelphia. See also Oberholtzer, _The
     Initiative, Referendum, and Recall in America_, ed. 1911.

     [71] _The Initiative, Referendum, and Recall_, Annals of the
     American Academy of Political and Social Science, September,
     1912, pp. 84 ff.

     [72] Arizona was admitted without the judicial recall
     provision, but immediately set to work and reinserted it in
     the constitution, and devised a plan for the recall of
     Federal district judges as well.

     [73] See below, p. 325.

     [74] See list in the _National Municipal Review_ for July,
     1912.

     [75] The Socialist party does not at present contemplate
     public ownership of petty properties or of farm lands tilled
     by their possessors. This is one part of its program not yet
     definitely worked out.

     [76] _Proceedings of the American Political Science
     Association_, 1908, Vol. V, p. 42.

     [77] See above, p. 54.

     [78] Taken from Professor Leacock's paper in the _Proceedings
     of the American Political Science Association_, 1908, pp. 37
     ff.




CHAPTER XII

MR. TAFT AND REPUBLICAN DISINTEGRATION


In spite of the stirring of new economic and political forces which
marked Mr. Roosevelt's administration and his somewhat radical
utterances upon occasion, there was no prominent leader in the
Republican party in 1908, except Mr. La Follette of Wisconsin, who was
identified with policies which later came to be known as "progressive."
Although Mr. Hughes, as governor of New York, had enlisted national
interest in his "fight with the bosses," he was, by temperament,
conservative rather than radical, and his doctrines were not primarily
economic in character. Other Republican aspirants were also of a
conservative cast of mind, Mr. Fairbanks, of Indiana, Mr. Knox, of
Pennsylvania, Mr. Cannon, of Illinois, all of whom were indorsed for the
presidency by their respective states. The radical element among the
Republicans hoped that Mr. Roosevelt would consent to accept a "second
elective term"; but his flat refusal put an end to their plans for
renomination.

Very early in his second administration, Mr. Roosevelt made it clear
that he wanted to see Mr. W. H. Taft, then Secretary of War, designated
as his successor; and by the judicious employment of publicity and the
proper management of the Federal patronage and the southern Republican
delegates, he materially aided in the nomination of Mr. Taft at Chicago,
in June, 1908. The Republican platform of that year advocated a revision
of the tariff, not necessarily downward, but with a due regard to
difference between the cost of production at home and abroad; it favored
an amendment of the Sherman anti-trust law in such a manner as to give
more publicity and the Federal government more supervision and control;
it advocated the regulation of the issuance of injunctions by the
Federal courts; it indorsed conservation and pledged the party to
"unfailing adherence" to Mr. Roosevelt's policies. This somewhat
noncommittal platform was elaborated by Mr. Taft in his speech, after a
conference with Mr. Roosevelt; the popular election of Senators was
favored, an income tax of some kind indorsed, and a faintly radical
tinge given to the party document.

The nomination of Mr. Bryan by the Democrats was a foregone conclusion.
The debacle of 1904 had demonstrated that the breach of 1896 could not
be healed by what the western contingent called "the Wall Street crowd";
and Mr. Bryan had secured complete control of the party organization.
The convention at Denver was a personal triumph from beginning to end.
Mr. Bryan mastered the proceedings and wrote the platform, and received
the most telling ovation ever given to a party leader by a national
convention.

Having complete control, Mr. Bryan attempted what the politicians who
talked most aggressively about the trusts had consistently refused to
do--he attempted to define and precisely state the remedies for
objectionable combinations. Other leaders had discussed "good" and
"bad" trusts, but they had not attempted the mathematics of the problem.
In the platform of his party, Mr. Bryan wrote: "A private monopoly is
indefensible and intolerable. We therefore favor the vigorous
enforcement of the criminal law against guilty trust magnates and
officials and demand the enactment of such additional legislation as may
be necessary to make it impossible for private monopoly to exist in the
United States." In this paragraph, there is of course nothing new; but
it continues: "Among the additional remedies we specify three: first, a
law preventing the duplication of directors among competing
corporations; second, a license system which will, without abridging the
rights of each state to create corporations or its right to regulate as
it will foreign corporations doing business within its limits, make it
necessary for a manufacturing or trading corporation engaged in
interstate commerce to take out a federal license before it shall be
permitted to control as much as 25 per cent of the product in which it
deals, a license to protect the public from watered stock and to
prohibit the control by such corporation of more than 50 per cent of the
total amount of any product consumed in the United States; and third, a
law compelling such licensed corporations to sell to all purchasers in
all parts of the country on the same terms after making due allowance
for cost of transportation."

In dealing with railway corporations, the Democratic platform proposed
concretely the valuation of railways, taking into consideration the
physical as well as other elements; an increase in the power of the
Interstate Commerce Commission, giving it the initiative with reference
to rates and transportation charges and the power to declare any rate
illegal on its own motion, and to inspect railway tariffs before
permitting them to go into effect; and finally an efficient supervision
and regulation of railroads engaged in interstate commerce.

Mr. Bryan's proposals, particularly with regard to trusts, were greeted
with no little derision on the part of many practical men of affairs,
but they had, at least, the merit of being more definite in character
than any statement of anti-trust policy which had been made hitherto,
except by the Socialists in advocating public ownership. The
Republicans, for example, contented themselves with simply proposing the
amendment of the Sherman law in such a manner as to "give to the federal
government greater supervision and control over and secure greater
publicity in the management of that class of corporations engaged in
interstate commerce having power and opportunity to effect monopolies."

The campaign of 1908 was without any specially dramatic incidents. The
long stumping tours by all candidates did not seem to elicit the
old-time enthusiasm. The corporation interests that had long financed
the Republican party once more poured out treasure like water (as the
Clapp investigation afterward revealed in 1912); and Mr. Bryan attempted
a counter-movement by asking for small contributions from each member of
his party, but he was sadly disappointed by the results. The Democratic
national committee announced that it would receive no contributions from
corporations, that it would accept no more than $10,000 from any
individual, and that it would make public, before the election, all
contributions above $100. Mr. Bryan also challenged Mr. Taft to make
public the names of the contributors to his fund and the amount received
from each. The Republican managers replied that they would make known
their contributors in due time as required by the law of the state of
New York where the headquarters were located, and Mr. Taft added that he
would urge upon Congress the enactment of a law compelling full
publicity of campaign contributions.[79]

In the election which followed, Mr. Bryan was defeated for the third
time. His vote was somewhat larger than it was in 1900, and nearly a
million and a half above that cast for Mr. Parker in 1904. But Mr. Taft
more than held the strength of his predecessor as measured by the
popular vote, and he received 321 electoral votes against 162 cast for
his opponent. Once more, the conservative press announced, the country
had repudiated Populism and demonstrated its sound, conservative
instincts.

When Mr. Taft took the oath of office on March 4, 1909, he fell heir, on
his own admission, to more troublesome problems than had been the lot of
any President since Lincoln's day. His predecessor had kept the country
interested and entertained by the variety of his speeches and
recommendations and by his versatility in dealing with all the social
questions which were pressing to the front during his administration.
Mr. Roosevelt was brilliant in his political operations, although he had
been careful about attempting to bring too many things to concrete
issue. Mr. Taft was matter-of-fact in his outlook and his expectations.
The country had been undergoing a process of education, as he put it,
and now the time had come for taking stock. The time had come for
putting the house in order and settling down to a period of rest. If
there were signs on the horizon which warned Mr. Taft against this
comfortable view, his spoken utterances gave no sign of recognition.


_Legislative Measures_

The first task which confronted him was the thorny problem of the
tariff. His predecessor had given the matter little attention during his
administration, apparently for the reason that it was, in his opinion,
of little consequence as compared with the questions of railways,
trusts, great riches, and labor. But action could not be indefinitely
postponed. Undoubtedly there was a demand in many parts of the country
for a tariff revision. How widespread it was, how much it was the
creation of the politicians, how intelligent and deep-seated it was, no
one could tell. Nevertheless, more than ten years had elapsed since the
enactment of the Dingley law of 1897, and many who did not entertain
radical views on the subject at all joined in demanding a revision on
the ground that conditions had materially changed. The Republican
platform had promised revision on the basis that the true principle of
protection was best maintained by the imposition of such duties "as
will equal the difference between the cost of production at home and
abroad, together with a reasonable profit to American industries." Mr.
Taft in his speech of acceptance had promised revision, on the theory
that some schedules were too high and others too low; and his language
during the campaign had been interpreted to mean a more severe downward
revision than he had doubtless contemplated.

In accordance with party pledges Mr. Taft called Congress in a special
session on March 11, 1909, and after a hotly contested battle the
Payne-Aldrich tariff act was passed. The President made no considerable
effort to force the hand of Congress one way or the other, and he
accepted the measure on the theory that it was the best tariff law that
could be got at the time. Indeed, it was pointed out by members of his
party that the bill contained "654 decreases in duty, 220 increases, and
1150 items of the dutiable list in which the rates were unchanged." It
was also stated that the bill was framed in accordance with the spirit
of the party platform which had made no promise of a general sweeping
reduction. It was admitted, however, that precise information upon the
difference between the cost of production at home and abroad could not
have been obtained in time for this revision, but a tariff board was
created by law for the purpose of obtaining the desired information, on
the basis of which readjustments in schedules could be made from time to
time.

On April 9, 1909, the Payne tariff act passed the House, one Republican
voting against it and four Democrats from Louisiana voting in favor of
it. This vote, however, was of no significance; the real test was the
vote on the several amendments proposed from time to time to the
original bill, and on these occasions the Democratic lines were badly
broken. On April 12, Mr. Aldrich introduced in the Senate a tariff bill
which had been carefully prepared by the finance committee of which he
was chairman. This measure followed more closely the Dingley law, making
no recommendations concerning some of the commodities which the House
had placed on the free list, and passing over the subject of income and
inheritance taxes without remark. The Aldrich measure was bitterly
attacked by insurgent Republicans from the West,--Senators Dolliver and
Cummins, of Iowa, La Follette, of Wisconsin, Beveridge, of Indiana, and
Bristow, of Kansas,--who held out to the last and voted against the
bill, even as amended, on its final passage, July 8. The conference
committee of the two Houses settled their differences by July 30, and on
August 5 the tariff bill became a law.

There were several features of the transaction which deserve special
notice. Very early in the Senate proceedings on the bill, an income tax
provision was introduced by Senators Cummins and Bailey, and it looked
as if enough support could be secured from the two parties to enact it
into law. Although President Taft, in his acceptance speech, had
expressed an opinion to the effect that an income tax could be
constitutionally enacted notwithstanding the decision of the Supreme
Court in the Income Tax cases, he blocked the proposal to couple an
income tax measure with the tariff bill, by sending a special message
on June 16, recommending the passage of a constitutional amendment
empowering Congress to levy a general income tax, and advising a tax on
the earnings of corporations. His suggestions were accepted by Congress.
The proposed amendment to the Constitution was passed unanimously by the
Senate, and by an overwhelming majority in the House,[80] and a tax on
the net incomes of corporations was also adopted. A customs court to be
composed of five judges to hear appeals in customs cases was set up, and
a tariff commission to study all aspects of the question, particularly
the differences between cost of production in the United States and
abroad, was created.

Revision of the tariff had always been a thankless task for any party.
The Democrats had found it such in 1894 when their bill had failed to
please any one, including President Cleveland, and when for collateral
or independent reasons a period of industrial depression had set in. The
McKinley bill of 1890 had aroused a storm of protest which had swept the
Republicans out of power, and it is probable that the Dingley tariff of
1897 would have created similar opposition if it could have been
disentangled from the other overshadowing issues growing out of the
Spanish War. The Payne-Aldrich tariff likewise failed to please; but its
failure was all the more significant because its passage was opposed by
such a large number of prominent party members. The Democrats, as was
naturally to be expected, made all they could out of the situation, and
cried "Treason." Even what appeared to be a concession to the radicals,
the adoption of a resolution providing for an amendment to the
Constitution authorizing the imposition of an income tax, was not
accepted as a consolation, but was looked upon as a subterfuge to escape
the probable dilemma of having an income tax law passed immediately and
submitted to the Supreme Court again.

Notwithstanding the dissensions within his party, Mr. Taft continued
steadily to press a legislative policy which he had marked out. In a
special message on January 7, 1910, he recommended the creation of a
court of commerce to have jurisdiction, among other things, over appeals
from the Interstate Commerce Commission. This proposal was enacted into
law on June 18, 1910; and the appointments were duly made by the
President. The career of the tribunal was not, however, particularly
happy. Some of its decisions against the rulings of the Commission were
popularly regarded as too favorable to railway interests; one of the
judges, Mr. Archbald, of Pennsylvania, was impeached and removed on the
ground that his private relations with certain railway corporations were
highly questionable; and at length Congress in 1913 terminated its short
life.

Acting upon a recommendation of the President, Congress, in June, 1910,
passed a law providing for the establishment of a postal savings system,
in connection with the post offices. The law authorized the payment of
two per cent interest on money deposited at the designated post offices
and the distribution of all such deposits among state and national
banks under the protection of bonds placed with the Treasurer of the
United States. The scheme was applied experimentally at a few offices
and then rapidly extended, until within two years it was in operation at
more than 12,000 offices and over $20,000,000 was on deposit. The plan
which had been branded as "socialistic" a few years before when
advocated by the Populists was now hailed as an enlightened reform, even
by the banks as well as business men, for they discovered that it
brought out secret hoardings and gave the banks the benefit at a low
rate of interest--lower than that paid by ordinary savings concerns.

The postal savings system was shortly supplemented by a system of
parcels post. Mr. Taft strongly advocated the establishment of such a
system, and it had been urged in Congress for many years, but had been
blocked by the opposition of the express companies, for obvious reasons,
and by country merchants who feared that they would be injured by the
increased competition of the mail order departments of city stores.
Finally, by a law approved on August 24, 1912, Congress made provision
for the establishment of this long-delayed service, and it was put into
effect on January 1, 1913, thus enabling the United States to catch up
with the postal systems of other enlightened nations. Although the
measure was sharply criticized for its rates and classifications, it was
generally approved and regarded as the promising beginning of an
institution long desired.

While helping to add these new burdens to the post-office
administration, Mr. Taft directed his attention to the urgent necessity
for more businesslike methods on the part of the national administration
in general, and, on his recommendation, Congress appropriated in 1910
$100,000 "to enable the President to inquire into the methods of
transacting the public business of the Executive Department and other
government establishments, and to recommend to Congress such legislation
as may be necessary." A board of experts, known as the Economy and
Efficiency Commission, was thereupon appointed, and it set to work
examining the several branches of administration with a view to
discovering wasteful and obsolete methods in use and recommending
changes and practices which would result in saving money and producing
better results. Among other things, the Commission undertook an
examination of the problem of a national budget along lines followed by
the best European governments, and it suggested the abandonment of the
time-honored "log-rolling" process of making appropriations, in favor of
a consistent, consolidated, and businesslike budget based upon national
needs and not the demands of localities for Federal "improvements,"
regardless of their utility.

Although he was sharply attacked by the advocates of conservation for
appointing and supporting as Secretary of the Interior, Mr. R. A.
Ballinger, who was charged with favoring certain large corporations
seeking public land grants, Mr. Taft devoted no little attention to the
problem of conserving the natural resources. In 1910, Congress enacted
two important laws bearing on the subject. By a measure approved June
22, it provided for agricultural entries on coal lands and the
separation of the surface from the mineral rights in such lands. By
another law, approved three days later, Congress made provision for the
withdrawal of certain lands for water-power sites, irrigation,
classification of lands, and other public purposes. These laws settled
some questions of legality which had been raised with reference to
earlier executive action in withdrawing lands from entry and gave the
President definite authority to control important aspects of
conservation.

From the opening of his administration Mr. Taft used his influence in
every legitimate way to assist in the development of the movement for
international peace. In his acceptance speech, at the opening of his
campaign for election, he had remarked upon the significance and
importance of the arbitration treaties which had been signed between
nations and upon the contribution of Mr. Roosevelt's administration to
the cause of world peace. Following out his principles, Mr. Taft signed
with France and England in August, 1911, general arbitration treaties
expanding the range of the older agreements so as to include all
controversies which were "justiciable" in character, even though they
might involve questions of "vital interest and national honor." The
treaties, which were hailed by the peace advocates with great acclaim,
met a cold reception in the Senate which ratified them on March 7, 1912,
only after making important amendments that led to their abandonment.

       *       *       *       *       *

Among the most significant of Mr. Taft's acts were his appointments of
the Supreme Court judges. On the death of Chief Justice Fuller, in 1910,
he selected for that high post Associate Justice White. In the course
of his administration, Mr. Taft also had occasion to select five
associate justices, and he appointed Mr. Horace H. Lurton, of Tennessee,
Charles E. Hughes, governor of New York, Mr. Willis Van Devanter, of
Wyoming, Mr. Joseph R. Lamar, of Georgia, and Mr. Mahlon Pitney, of New
Jersey. Thus within four years the President was able to designate a
majority of the judges of the most powerful court in the world, and to
select the Chief Justice who presided over it.

It was hardly to be expected that the exercise of such a significant
power would escape criticism, particularly in view of the nature of the
cases which are passed upon by that Court. Mr. Bryan was particularly
severe in his attacks, charging the President with deliberately packing
the Court. "You appointed to the Chief Justiceship of the Supreme
Court," he said, "Justice White who thirteen years ago took the trusts'
side of the trust question.[81] ... You appointed Governor Hughes to the
Supreme Court bench after he had interpreted your platform to suit the
trusts." Mr. Bryan also demanded that Mr. Taft let the people know "the
influences" that dictated his appointments. Mr. Bryan attacked
particularly the selection of Mr. Van Devanter, declaring that the
latter, by his decisions in the lower court, was a notorious favorite of
corporation interests. Mr. Taft looked upon these attacks as insults to
himself and the judges, and treated them with the scant courtesy which,
in his opinion, they deserved. The episode, however, was of no little
significance in stirring up public interest in the constitution of a
tribunal that was traditionally supposed to be "non-political" in its
character.


_The Anti-Trust Cases_

Mr. Taft approached the trust problem with the pre-conceptions of the
lawyer who believes that the indefinite dissolution of combinations is
possible under the law. His predecessor had, it is true, instituted many
proceedings against trusts, but there was a certain lack of sharpness in
his tone, which was doubtless due to the fact that he believed and
openly declared that indiscriminate prosecutions under the Sherman law
(which was, in his opinion, unsound in many features) were highly
undesirable. Mr. Taft, on the other hand, apparently looked at the law
and not the economics of the problem. During Harrison's administration
there had been four bills in equity and three indictments under the
Sherman law; during Cleveland's administration, four bills in equity,
two indictments, two informations for contempt; during McKinley's
administration, three bills in equity. Mr. Roosevelt had to his record,
eighteen bills in equity, twenty-five indictments, and one forfeiture
proceeding. Within three years, Mr. Taft had twenty-two bills in equity
and forty-five indictments to his credit.

The very vigor with which Mr. Taft pressed the cases against the trusts
did more, perhaps, to force a consideration of the whole question by the
public than did Mr. Roosevelt's extended messages. As has been pointed
out, the members of Congress who enacted the Sherman law were very much
confused in their notions as to what trusts really were and what
combinations and practices were in fact to be considered in restraint of
trade.[82] And it must be confessed that the decisions and opinions of
the courts, up to the beginning of Mr. Taft's administration, had not
done much to clarify the law. In the Trans-Missouri case, decided in
1897, the Supreme Court had declared in effect that all combinations in
restraint of trade, whether reasonable or unreasonable, were in fact
forbidden by the law, Justice White dissenting.[83]

This was not done by the Court inadvertently. Mr. Justice Peckham,
speaking for the majority of the Court, distinctly marked the fact that
arguments had been directed to that tribunal, "against the inclusion of
all contracts in restraint of trade, as provided for by the language of
the act ... upon the alleged presumption that Congress, notwithstanding
the language of the act, could not have intended to embrace all
contracts, but only such as were in unreasonable restraint of trade.
Under these circumstances we are, therefore, asked to hold that the act
of Congress excepts contracts which are not in unreasonable restraint of
trade, and which only keep rates up to a reasonable price,
notwithstanding the language of the act makes no such exception. In
other words, we are asked to read into the act by way of judicial
legislation an exception that is not placed there by the lawmaking
branch of the government.... It may be that the policy evidenced by the
passage of the act itself will, if carried out, result in disaster to
the roads.... Whether that will be the result or not we do not know and
cannot predict. These considerations are, however, not for us. If the
act ought to read as contended for by the defendants, Congress is the
body to amend it, and not this Court by a process of judicial
legislation wholly unjustifiable."

It was no doubt fortunate for the business interests of the country that
no earlier administration undertook a searching and drastic prosecution
of combinations under the Sherman law; for in the view of the language
of the Court it is difficult to imagine any kind of important
interconcern agreement which would not be illegal. This very delay in
the vigorous enforcement of the law enabled the country at large to take
a new view of the trusts and to throw aside much of the prejudice which
had characterized politics in the eighties and early nineties. The
lawless practices of the great combinations and their corrupting
influence were extensively discovered and understood; but it became
increasingly difficult for demagogues to convince the public that any
good could accrue to anybody from the ruthless attempts to disintegrate
all large combinations in business. The more radical sections, which had
formerly applauded the platform orator in his tirades against trusts,
were turning away from indiscriminate abuse and listening more
attentively than ever to the Socialists who held, and had held for half
a century, to the doctrine that the trusts were a natural product of
economic evolution and were merely paving the way to national ownership
on a large scale.

Consequently, between the two forces, the representatives of corporate
interests on the one hand and the spokesmen for socialistic doctrines on
the other, the old demand for the immediate and unconditional
destruction of the trusts was sharply modified. Corporations came to see
that undesirable as "government regulation" might be, it was still more
desirable than destruction. They, therefore, drew to themselves a large
support from sections of the population which did not share socialistic
ideas, and still could see nothing but folly in attempting to resist
what seemed to have the force of nature. Many working-class
representatives ceased to wage war on the trusts as such, for they did
not expect to get into the oil, copper, or steel business for
themselves; and the farmers, on account of rising prices and a large
appreciation in land values, listened with less gladness to the
"war-to-the-hilt" orator. Nevertheless, a large section of the
population, composed particularly of business men and manufacturers of
the lesser industries, hoped to "reestablish" what they called "fair
conditions of competition" by dissolving into smaller units the huge
corporations that dominated industry.

In response to this demand, Mr. Taft pushed through the cases against
the Standard Oil Company and the American Tobacco Company; and in May,
1911, the Supreme Court handed down decisions dissolving these
combinations. In the course of his opinions, Chief Justice White, who
had dissented in the Trans-Missouri case mentioned above, gave an
interpretation of the Sherman Act which was regarded quite generally as
an abandonment of the principles enunciated by the Court in that case.
He said: "The statute, under this view, evidenced the intent not to
restrain the right to make and enforce contracts, whether resulting from
combinations or otherwise, which did not _unduly restrain_ interstate
and foreign commerce, but to protect the commerce from being restrained
by methods, whether new or old, which would constitute an interference
that is an _undue_ restraint." Thus the Chief Justice restated the
doctrine of "reasonableness" which he had formulated in his dissenting
opinion in the earlier case, but this time as the spokesman of the
Court. It is true, he attempted with great dialectic skill to reconcile
the old and the new opinions, and make it appear that there had been no
change in the theories of the Court; but his attempt was not convincing
to every one, for many shared the view expressed by Justice Harlan, to
the effect that the attempt at reconciliation partook of the nature of a
statement that black is white and white is black.

The effect of these decisions was the dissolution of the two concerns
into certain constituent parts which were supposed to reestablish
competition; but no marvelously beneficial economic results seem to have
accrued. The inner circles of the two combinations made huge sums from
the appreciation of stocks; the prices of gasoline and some other oil
products mounted with astonishing speed to a higher rate than ever
before; and smaller would-be competitors declared that the constituent
companies were so large that competition with them was next to
impossible. No one showed any great enthusiasm about the results of the
prosecution and decisions, except perhaps some eminent leaders in the
business world, who shared the opinion of Mr. J. P. Morgan that the
doctrines of the Court were "entirely satisfactory," and to be taken as
meaning that indiscriminate assaults on large concerns, merely because
of their size, would not be tolerated by the Court. Radical
"trust-breakers" cried aloud that they had been betrayed by the eminent
tribunal, and a very large section of the population which had come to
regard trusts as a "natural evolution" looked upon the whole affair as
an anticlimax. Mr. Taft, in a speech shortly after the decisions of the
Court, expressed his pleasure at the outcome of the action and invited
the confidence of the country in the policy announced. He had carried a
great legal battle to its conclusion, only to find those who cheered the
loudest in the beginning, indifferent at the finish.


_The Overthrow of Speaker Cannon_

From the beginning of his administration, it was apparent that Mr.
Taft's party in Congress was not in that state of harmony which presaged
an uneventful legislative career. The vote on the tariff bill, both in
the Senate and the House, showed no little dissatisfaction with the way
in which the affairs of the party were being managed. The acrimony in
the tariff debate had been disturbing, and the attacks on Speaker Cannon
from his own party colleagues increased in frequency and virulence
inside and outside of Congress.

Under this astute politician and keen parliamentary manager, a system of
legislative procedure had grown up in the House, which concentrated the
management of business in the hands of a few members, while preserving
the outward signs of democracy within the party. The Speaker enjoyed the
power of appointing all of the committees of the House and of
designating the chairmen thereof. Under his power to object to a request
for "unanimous consent," he could refuse to recognize members asking for
the ear of the chamber under that privilege. He, furthermore, exercised
his general right of recognition in such a manner as to favor those
members who were in the good graces of the inner circle, which had
naturally risen to power through long service.

In addition, there had been created a powerful engine, known as the
"rules committee" which could, substantially at any time, set aside the
regular operations of the House, fix the limits of debate, and force the
consideration of any particular bill. This committee was composed of the
Speaker and two colleagues selected by himself, for, although there were
two Democratic representatives on the committee, they did not enjoy any
influence in its deliberations. The outward signs of propriety were
given to this enginery by the election of the Speaker by the party
caucus, but the older members and shrewd managers had turned the caucus
into a mere ratifying machine.

Under this system, which was perfected through the long tenure of power
enjoyed by the Republicans, a small group of managers, including Mr.
Cannon, came to a substantial control over all the business of the
House. A member could not secure recognition for a measure without
"seeing" the Speaker in advance; the older members monopolized the
important committees; and a measure introduced by a private member had
no chance for consideration, to say nothing of passage, unless its
sponsor made his peace with the party managers. This system was by no
means without its advantages. It concentrated authority in a few eminent
party spokesmen and the country came to understand that some one was at
last responsible for what happened in the House. The obvious
disadvantage was the use of power to perpetuate a machine and policies
which did not in fact represent the country or the party. Furthermore,
the new and younger members could not expect to achieve anything until
they had submitted to the proper "party discipline."

If anything went wrong, it soon became popular to attribute the evil to
"Cannon and his system." Attacks upon them became especially bitter in
the campaign of 1908 and particularly venomous after the passage of the
Aldrich-Payne tariff act. At length, in March, 1910, by a clever piece
of parliamentary manipulation, some "insurgent" Republicans were able to
present an amendment to the rules ousting the Speaker from membership in
the rules committee, increasing the number, and providing for election
by the House. Mr. Cannon was forced to rule on the regularity of this
amendment, and he decided against it. On appeal from the decision of the
chair, the Speaker was defeated by a combination of Democrats and
insurgent Republicans, and the committee on rules was reconstructed. A
motion to declare the Speakership vacant was defeated, however, because
only eight insurgents supported it, and accordingly Mr. Cannon was
permitted to serve out his term. Although this was heralded as "a great
victory," it was of no consequence in altering the management of
business in that session; but it was a solemn portent of the defeat for
the Republican party which lay ahead in the autumn.


_Dissensions_

The second half of Mr. Taft's administration was marked by the failure
to accomplish many results on which he had set his mind. The election of
1910 showed that the country was swinging back to the Democratic party
once more. In that year, the Democrats elected governors in
Massachusetts, Connecticut, New York, New Jersey, Indiana, and some
other states which had long been regarded as Republican. The Democrats
also carried the House of Representatives, securing 227 members to 163
Republicans and 1 Socialist, Mr. Berger, of Wisconsin. Although many
conservative Republican leaders, like Mr. Cannon, Mr. Payne, and Mr.
Dalzell, were returned, their position in the minority was seriously
impaired by the election of many "insurgent" Republicans from the West,
who were out of harmony with the old methods of the party.

In view of this Democratic victory, it was inevitable that Mr. Taft
should have trouble over the tariff. In accordance with the declarations
of the Republican platform, he had recommended and secured the creation,
in 1909, of a tariff board designed to obtain precise information on the
relation of the tariff to production and labor at home and abroad. The
work of this board fell into three main divisions. It was, in the first
place, instructed to take each article in the tariff schedule and
"secure concise information regarding the nature of the article, the
chief sources of supply at home and abroad, the methods of its
production, its chief uses, statistics of production, imports and
exports, with an estimate of the ad valorem equivalent for all specific
duties." In the second place, it was ordered to compile statistics on
the cost of production at home and abroad so that some real information
might be available as to the difference, with a view to discovering the
amount of protection necessary to accomplish the real purposes of a
"scientific" tariff. Finally, the board was instructed to secure
accurate information as to prices at home and abroad and as to the
general conditions of competition in the several industries affected by
the tariff.

If there was to be any protection at all, it was obvious that an immense
amount of precise information was necessary to the adjustment of
schedules in such a manner as not to give undue advantages to American
manufacturers and thus encourage sloth and obsolete methods on their
part. Such was the view taken by Mr. Taft and the friends of the tariff
board; but the Democratic Congress elected in 1910 gave the outward
signs of a determination to undertake a speedy and considerable
"downward revision," regardless of any "scientific" information that
might be collected by the administration. There was doubtless some
demand in the country for such a revision, and furthermore it was "good
politics" for the leaders of the new House to embarrass the Republican
President as much as possible. The opportunity was too inviting to be
disregarded, particularly with a presidential election approaching.

Consequently, the House, in 1911, passed three important tariff
measures: a farmers' free list bill placing agricultural implements,
boots and shoes, wire fence, meat, flour, lumber, and other commodities
on the free list; a measure revising the famous "Schedule K," embracing
wool and woolen manufactures; and a law reducing the duties on cotton
manufactures, chemicals, paints, metals, and other commodities. With the
support of the "insurgent" Republicans in the Senate these measures were
passed with more speed than was expected by their sponsors, and Mr. Taft
promptly vetoed them on the ground that some of them were loosely drawn
and all of them were based upon inadequate information. The following
year, an iron and steel measure and a woolens bill were again presented
to the President and as decisively vetoed. In his veto messages, Mr.
Taft pointed out that the concise information collected by the tariff
board was now at the disposal of Congress and that it was possible to
undertake a revision of many schedules which would allow a considerable
reduction without "destroying any established industry or throwing any
wage earners out of employment." These last veto messages, sent in
August, 1912, received scant consideration from members of Congress
already engaged in a hot political campaign.

Mr. Taft was equally unfortunate in his attempt to secure reciprocity
with Canada. In January, 1911, through the Secretary of State, he
concluded a reciprocity agreement with that country by the exchange of
notes, providing for a free list of more than one hundred articles and a
reduction of the tariff on more than four hundred articles. The
agreement was submitted to the legislatures of the two countries. A bill
embodying it passed the House, in February, by a Democratic vote, the
insurgent Republicans standing almost solidly against it, on the ground
that it discriminated against the farmers by introducing Canadian
competition, while benefiting the manufacturers who had no considerable
competition from that source. The Senate failed to act on the bill until
the next session of the new Congress when it was passed in July with
twelve insurgent and twelve regular Republicans against it. After having
wrought this serious breach in his own party in Congress, Mr. Taft was
sorely disappointed by seeing the whole matter fall to the ground
through the overthrow of the Liberals in Canada at the election in
September, 1911, and the rejection by that country of the measure for
which he had so laboriously contended.

During the closing days of his administration, Mr. Taft was seriously
beset by troubles with Mexico. Under the long and severe rule of General
Porfirio Diaz in that country, order had been set up there (at whatever
cost to humanity) and American capital had streamed into Mexican mines,
railways, plantations, and other enterprises. In 1911, Diaz was
overthrown by Francisco Madero and the latter was hardly installed in
power before he was assassinated and a dictatorship set up under General
Huerta, in February, 1913. After the overthrow of Diaz in 1911, Mexico
was filled with revolutionary turmoil, and American lives and property
were gravely menaced. In April, 1912, Mr. Taft solemnly warned the
Mexican government that the United States would hold it responsible for
the destruction of American property and the taking of American life,
but this warning was treated with scant courtesy by President Madero.
The disorders continued to increase, and demands for intervention on the
part of the United States were heard from innumerable interested
quarters, but Mr. Taft refused to be drawn into an armed conflict. The
Mexican trouble he bequeathed to his successor.

FOOTNOTES:

     [79] Congress by an act of 1907 forbade campaign
     contributions by corporations, in connection with Federal
     elections, and in 1910 and 1911 enacted laws providing for
     the publicity of expenses in connection with elections to
     Congress.

     [80] The Sixteenth Amendment was proclaimed in force on
     February 25, 1913.

     [81] See below, p. 332.

     [82] See above, p. 135.

     [83] United States _v._ Trans-Missouri Freight Assn., 166 U.
     S. 290.




CHAPTER XIII

THE CAMPAIGN OF 1912


Long before the opening of the campaign of 1912, the dissenters in the
Republican party who had added the prefix of "Progressive" to the old
title, began to draw together for the purpose of resisting the
renomination of Mr. Taft and putting forward a candidate more nearly in
accord with their principles. As early as January 21, 1911, a National
Progressive Republican League was formed at the residence of Senator La
Follette in Washington and a program set forth embracing the indorsement
of direct primaries, direct elections, and direct government generally
and a criticism of the recent failures to secure satisfactory
legislation on the tariff, trusts, banking, and conservation. Only on
the changes in our machinery of government did the League take a
definite stand; on the deeper issues of political economy it was silent,
at least as to positive proposals. Mr. Roosevelt was invited to join the
new organization, but he declined to identify himself with it.

For a time the Progressives centered their attacks upon Mr. Taft's
administration. Their bill of indictment may be best stated in the
language of Senator La Follette: "In his campaign for election, he [Mr.
Taft] had interpreted the platform as a pledge for tariff revision
downward. Five months after he was inaugurated he signed a bill that
revised the tariff upward.... The President started on a tour across the
country in September, 1909. At the outset in an address at Boston he
lauded Aldrich as the greatest statesman of his time. Then followed his
Winona speech, in which he declared the Payne-Aldrich bill to be the
best tariff ever enacted, and in effect challenged the Progressives in
Congress who had voted against the measure.... During the succeeding
sessions of Congress, President Taft's sponsorship for the
administration railroad bill, with its commerce court, its repeal of the
anti-trust act in its application to railroads, its legalizing of all
watered railroad capitalization; his course regarding the Ballinger and
Cunningham claims, and the subterfuges resorted to by his administration
in defense of Ballinger; his attempt to foist upon the country a sham
reciprocity measure; his complete surrender to the legislative
reactionary program of Aldrich and Cannon and the discredited
representatives of special interests who had so long managed
congressional legislation, rendered it utterly impossible for the
Progressive Republicans of the country to support him for
reelection."[84]

A second positive step in the organization of the Progressive
Republicans was taken in April, 1911, at a conference held in the
committee room of Senator Bourne, of Oregon, at the Capitol. At this
meeting a number of Republican Senators, Representatives, newspaper men,
and private citizens were present, and it was there agreed that the
Progressives must unite upon some candidate in opposition to Mr. Taft.
The most available man at the time was Senator La Follette, who had been
an uncompromising and vigorous exponent of progressive doctrines since
his entrance to the Senate in 1906; and the members of this conference,
or at least most of them, assured him of their support in case he would
consent to become a candidate for nomination. The Senator was informed
by men very close to Mr. Roosevelt that the latter would, under no
circumstances, enter the field; and he was afforded the financial
assistance necessary to open headquarters for the purpose of advancing
his candidacy. No formal announcement of the adherence of the group to
Mr. La Follette was then made, for the reason that Senator Cummins, of
Iowa, and some other prominent Republicans declined to sign the call to
arms.[85]

In July, 1911, Senator La Follette began his active campaign for
nomination as an avowed Progressive Republican, and within a few months
he had developed an unexpected strength, particularly in the Middle
West, which indicated the depth of the popular dissatisfaction with Mr.
Taft's administration. In October of that year a national conference of
Progressive Republicans assembled at Chicago, on the call of Mr. La
Follette's campaign manager, and indorsed the Senator in unmistakable
language, declaring him to be "the logical Republican candidate for
President of the United States," and urging the formation of
organizations in all states to promote his nomination. In spite of these
outward signs of prosperity, however, Mr. La Follette was by no means
sure of his supporters, for several of the most prominent, including Mr.
Gifford Pinchot and Mr. James R. Garfield, were not whole-hearted in
their advocacy of his cause and were evidently unwilling to relinquish
the hope that Mr. Roosevelt might become their leader after all.

Indeed, Senator La Follette came to believe that many of his supporters,
who afterward went over to Mr. Roosevelt, never intended to push his own
candidacy to the end, but employed him as a sort of "stalking horse" to
interest and measure progressive sentiment for the purpose of putting
the ex-President into the field at the opportune moment, if the signs
proved auspicious. This was regarded by Mr. La Follette not merely as
treachery to himself, but also as treason to genuine progressive
principles. In his opinion, Mr. Roosevelt's long administration of seven
years had failed to produce many material results. He admitted that the
ex-President had done something to promote conservation of natural
resources, but called attention to the fact that the movement for
conservation had been begun even as early as Harrison's
administration.[86] He pointed out that Mr. Roosevelt had vigorously
indorsed the Payne-Aldrich tariff in the New York state campaign of
1910; and that during his administration the formation and
overcapitalization of gigantic combinations had gone forward with
unprecedented speed, in spite of the denunciation of "bad trusts" in
executive messages. Furthermore, the Senator directly charged Mr.
Roosevelt with having used the power of the Federal patronage against
him in his fight for progressive reforms in Wisconsin.

So decided was Senator La Follette's distrust of Mr. Roosevelt's new
"progressivism," that nothing short of a lengthy quotation can convey
the spirit of it. "While Mr. Roosevelt was President," says the Senator,
"his public utterances through state papers, addresses, and the press
were highly colored with rhetorical radicalism. His administrative
policies as set forth in his recommendations to Congress were vigorously
and picturesquely presented, but characterized by an absence of definite
economic conception. One trait was always pronounced. His most savage
assault upon special interests was invariably offset with an equally
drastic attack upon those who were seeking to reform abuses. These were
indiscriminately classed as demagogues and dangerous persons. In this
way he sought to win approval, both from the radicals and the
conservatives. This cannonading, first in one direction and then in
another, filled the air with noise and smoke, which confused and
obscured the line of action, but when the battle cloud drifted by and
quiet was restored, it was always a matter of surprise that so little
had really been accomplished.... He smeared the issue, but caught the
imagination of the younger men of the country by his dash and mock
heroics. Taft cooperated with Cannon and Aldrich on legislation.
Roosevelt cooperated with Aldrich and Cannon on legislation. Neither
President took issue with the reactionary bosses of the Senate upon any
legislation of national importance. Taft's talk was generally in line
with his legislative policy. Roosevelt's talk was generally at right
angles to his legislative policy. Taft's messages were the more directly
reactionary; Roosevelt's the more 'progressive.' But adhering to his
conception of a 'square deal,' his strongest declarations in the public
interest were invariably offset with something comforting for Privilege;
every phrase denouncing 'bad' trusts was deftly balanced with praise for
'good' trusts." It is obvious that a man so deeply convinced of Mr.
Roosevelt's insincerity of purposes and instability of conviction could
not think of withdrawing in his favor or of lending any countenance to
his candidacy for nomination. To Senator La Follette the "directly
reactionary" policy of Mr. Taft was far preferable to the "mock heroics"
of Mr. Roosevelt.

Nevertheless, at the opening of the presidential year, 1912, all
speculations turned upon the movements of Mr. Roosevelt. His long trip
to Africa and Europe and his brief abstention from politics on his
return in June, 1910, led many, who did not know him, to suppose that he
might emulate the example set by Mr. Cleveland in retiring from active
affairs. If he entertained any such notions, it was obvious that the
exigencies of affairs in his party were different from those in the
Democratic party after 1897. Indeed, during the very summer after his
return, the cleavage between the reformist Hughes wing of the
Republicans in New York and the "regular" group headed by Mr. William
Barnes had developed into an open breach; and at the earnest entreaty of
the representatives of the former faction, Mr. Roosevelt plunged into
the state contest, defeated Vice President Sherman in a hot fight for
chairmanship of the state convention, and secured the nomination of Mr.
H. A. Stimson as the Republican candidate for governor. The platform
which was adopted by the convention was colorless enough for the most
conservative party member and gave no indication of the radical drift
manifested two years later at Chicago. The defeat of Mr. Stimson gave no
little satisfaction to the ex-President's opponents, particularly to
those who hoped that he had at last been "eliminated."

They had not, however, counted on their man. During the New York
gubernatorial campaign, he made a tour of the West, and in a series of
remarkable speeches, he stirred that region by the enunciation of
radical doctrines which were listened to gladly by the multitude. In an
address at Ossawatomie, Kansas, on August 31, 1910, he expounded his
principles under the title of "the New Nationalism." He there advocated
Federal regulation of trusts, a graduated income tax, tariff revision
schedule by schedule, conservation, labor legislation, the direct
primary, recall of elective officers, and the adjustment of state and
Federal relations in such a form that there might be no neutral ground
to serve as the refuge for lawbreakers.[87] In editorials in the
_Outlook_, of which he was the contributing editor, and in his speeches,
Mr. Roosevelt continued to discuss Mr. Taft's policies and the current
issues of popular government. At length, in February, 1912, in an
address before the constitutional convention of Ohio, he came out for a
complete program of "direct" government, the initiative, referendum,
and recall; but with such careful qualifications that the more radical
progressives were still unconvinced.[88]

Notwithstanding his extensive discussion of current issues and his great
popularity with a large section of the Progressive group, Mr. Roosevelt
steadily put away all suggestions that he should become a candidate in
1912. In a letter to the Pittsburgh _Leader_, of August 22, 1911, he
said: "I must ask not only you, but every friend I have, to see to it
that no movement whatever is made to bring me forward for nomination in
1912.... I should esteem it a genuine calamity if such a movement were
undertaken." Nevertheless, all along, men who were very close to him
believed that he would not refuse the nomination if it were offered to
him under proper circumstances. As time went on his utterances became
more pronounced, particularly in his western speeches, and friendly as
well as unfriendly newspapers insisted on viewing his conduct as a
distinct appeal for popular support for the Republican nomination.

The climax came in February, 1912, when seven Republican Governors,
Glasscock, of West Virginia, Aldrich, of Nebraska, Bass, of New
Hampshire, Carey, of Wyoming, Stubbs, of Kansas, Osborn, of Michigan,
and Hadley, of Missouri, issued a statement that the requirements of
good government demanded his candidature, that the great majority of
Republican voters desired it, that he stood for the principles and
policies most conducive to public happiness and prosperity, and finally
that it was his plain duty to accept regardless of his personal
interests or preferences. To this open challenge, he replied on February
24 by saying that he would accept the nomination if tendered and abide
by this decision until the convention had expressed its preference. The
only political doctrine which he enunciated was belief "in the rule of
the people," and on this principle he expressed a desire for direct
primaries to ascertain the will of the party members.


_The Nomination of Candidates in 1912_

A new and unexpected turn was given to the campaign for nomination by
the adoption of the preferential primary in a number of states, East as
well as West. As we have seen, the direct primary[89] was brought into
action by men who found themselves outside of the old party
intrenchments. La Follette, in Wisconsin, Stubbs, in Kansas, Hughes, in
New York, and the other advocates of the system, having failed to
capture the old strongholds, determined to blow them up; the time had
now come for an attack on the national convention. President Taft and
the regular Republican organization were in possession of the enormous
Federal patronage, and they knew how to use it just as well as had Mr.
Roosevelt in 1908 when he forced the nomination of Mr. Taft. True to
their ancient traditions, the Republican provinces in the South began,
early in 1912, to return "representatives" instructed to vote for a
second term for President Taft. But the Progressives were forearmed as
well as forewarned.

As early as February 27, 1912, Senator Bourne had warned the country
that the overthrow of "the good old ways" of nominating presidential
candidates was at hand. In a speech on that date, he roundly denounced
the convention and described the new Oregon system. He declared that
nominations in national conventions were made by the politicians, and
that the "electorate of the whole United States is permitted only to
witness in gaping expectancy, and to ratify at the polls in the
succeeding November." The flagrancy of this abuse, however, paled into
insignificance, added Mr. Bourne, "in the presence of that other abuse
against partisan conscience and outrage upon the representative system
which is wrought by the Republican politician in hopelessly Democratic
states and by the Democratic politician in hopelessly Republican states
in dominating the national conventions with the presence of these
unrepresentative delegations that represent neither party, people, nor
principle."

The speaker then elaborated these generalities by reference to details.
He pointed out that the southern states and territories which (except
Maryland) gave no electoral votes to Mr. Taft had 338 delegates in the
convention, only 153 less than a majority of the entire party assembly,
four more than the combined votes of New York, Pennsylvania, Illinois,
Ohio, Massachusetts, Indiana, and Iowa with 334 delegates. Moreover,
equal representation of states and territories on the national committee
and on the committee on credentials--the two bodies which, in the first
instance, pass upon the rights of delegates to their seats--gave undue
weight to the very states where wrongs were most likely to be
committed. As to the power of the Republican President of the United
States to control these delegates from the South, the Senator was in no
doubt.

To the anomalous southern delegates were added the delegates selected in
northern states by the power of patronage. Mr. Bourne was specific:
"Three years ago," he said, "we had a convincing exhibition of the power
of a President to dictate the selection of his successor. At that time,
three fourths of the Republican voters of my state were in favor of the
renomination of Mr. Roosevelt, and believing that their wishes should be
observed, I endeavored to secure a delegation from that state favorable
to his nomination for a second elective term. But through the tremendous
power of the Chief Executive and of the Federal machine the delegates
selected by our state convention were instructed for Mr. Taft. After all
the delegates were elected and instructed, a poll was taken by one of
the leading newspapers in Portland, which city contains nearly one third
of the entire population of the state. The result indicated that the
preference of the people of the state was 11 to 1 in favor of Mr.
Roosevelt as against Mr. Taft." It was this personal experience with the
power of Federal patronage that induced Mr. Bourne to draft the Oregon
presidential primary law which was enacted by the use of the initiative
and referendum in 1910.

The provisions of the Oregon law follow:

(1) At the regular primary held on the forty-fifth day before the first
Monday in June of the presidential year, each voter is given an
opportunity to express his preference for one candidate for the office
of President and one for that of Vice President, either by writing the
names or by making crosses before the printed names on the ballot.

(2) The names of candidates for the two offices are placed on the ballot
without their consent, if necessary, by petitions filed by their
supporters, just as in the case of candidates for governor and United
States Senator.

(3) The committee or organization which places a presidential aspirant
on the primary ballot is provided, on payment therefor, four pages in
the campaign book issued by the state, and electors who oppose or
approve of any such aspirant for nomination are likewise given space in
the campaign book.

(4) Delegates to national conventions and presidential electors must be
nominated at large at the primary.

(5) Every delegate is paid his expenses to the national convention; in
no case, however, more than $200.

(6) Every delegate must take an oath to the effect that he will "to the
best of his judgment and ability faithfully carry out the wishes of his
political party as expressed by its voters at the time of his election."

The initial move of Oregon to secure a preferential vote on candidates
and the instruction of delegates was followed in 1911 by New Jersey,
Nebraska, California, North Dakota, and Wisconsin, and in 1912 by
Massachusetts, Illinois, and Maryland.

The other presidential primary laws show some variations on the Oregon
plan although they agree in affording the voter an opportunity to
express his preference. Nebraska, for example, refused to disregard the
Republican system of district representation, and provided that "four
delegates shall be elected by the voters of the state at large; the
remainder of the delegates shall be equally divided between the various
congressional districts in the state and district delegates shall be
elected by the voters of the various congressional districts in the
state." Massachusetts follows Nebraska in this rule, but California
prefers the Oregon plan of election at large. It was this provision in
the law of California that caused the controversy over the seating of
two district delegates at Chicago in June, 1912. Although Mr. Roosevelt
carried the state, one of the districts went for Mr. Taft, and the
convention seated the delegates from this district, on the ground that
the rules of the party override a state statute.

The Illinois law does not attempt to bind the delegates to a strict
observance of the results of the primary. On the contrary it expressly
states "that the vote for President of the United States as herein
provided for shall be for the sole purpose of securing an expression of
the sentiment and will of the party voters with respect to the candidate
for nomination for said office, and the vote of the state at large shall
be taken and considered as advisory to the delegates and alternates at
large to the national conventions of the respective political parties;
and the vote of the respective congressional districts shall be taken
and considered as advisory to the delegates and alternates of the said
congressional districts to the national convention of the respective
political parties."

       *       *       *       *       *

The existence of these laws in several strategic states made it
necessary for the Republican and Democratic candidates to go directly
before the voters to discuss party issues. The country witnessed the
unhappy spectacle of two former friends, Mr. Taft and Mr. Roosevelt,
waging bitter war upon each other on the hustings. The former denounced
the Progressives as "political emotionalists or neurotics." The latter
referred to his candidacy in the words, "My hat is in the ring"; and
during his campaign fiercely turned upon Mr. Taft. He gave to the public
a private letter in which Mr. Taft acknowledged that Mr. Roosevelt had
voluntarily transferred to him the presidential office, and added the
comment, "It is a bad trait to bite the hand that feeds you."

Mr. Roosevelt's candidature was lavishly supported by Mr. G. W. Perkins,
of the Steel and Harvester Trusts, and by other gentlemen of great
wealth who had formerly indorsed Mr. Hanna's methods; and all of the old
engines of politics were brought into play. While making the popular
appeal in the North, Mr. Roosevelt's managers succeeded in securing a
large quota of "representatives" from the southern Republican provinces
to contest those already secured by Mr. Taft. As the matter was put by
the Washington _Times_, a paper owned by Mr. Munsey, one of Mr.
Roosevelt's ardent supporters: "For psychological effect, as a move in
practical politics, it was necessary for the Roosevelt people to start
contests on these early Taft selections, in order that a tabulation of
strength could be put out that would show Roosevelt holding a good hand
in the game. A table showing 'Taft, 150, Roosevelt, 19; contested none,'
would not be likely to inspire confidence. Whereas one showing 'Taft,
23, Roosevelt, 19; contested, 127,' looked very different."

The results of the Republican presidential primaries were astounding.
Mr. Roosevelt carried Illinois by a majority of 100,000; he obtained 67
of the 76 delegates from Pennsylvania; the state convention in Michigan
broke up in a riot; he carried California by a vote of two to one as
against Mr. Taft; he swept New Jersey and South Dakota; and he secured
the eight delegates at large in Massachusetts, although Mr. Taft carried
the preferential vote by a small majority. Connecticut and New York were
strongly for Mr. Taft, and Mr. La Follette carried Wisconsin and North
Dakota. Mr. Taft's supporters called attention to the fact that a very
large number of Republicans had failed to vote at all in the
preferential primaries, but they were speedily informed by the
opposition that they would see the shallowness of this contention if
they inquired into the number who voted for delegates to the conventions
which indorsed Mr. Taft.

When the Republican convention assembled in Chicago, 252 of the 1078
seats were contested; 238 of these were held by Mr. Taft's delegates and
14 by Mr. Roosevelt's supporters. The national committee, after the
usual hearings, decided the contests in such a manner as to give Mr.
Taft a safe majority. No little ingenuity was expended on both sides to
show the legality or the illegality of the several decisions. Mr.
Taft's friends pointed out that they had been made in a constitutional
manner by the proper authority, the national committee "chosen in 1908
when Roosevelt was the leader of the party, at a time when his influence
dominated the convention." Mr. Roosevelt's champions replied by cries of
"fraud." Independent newspapers remarked that there was no more
"regularity" about one set of southern delegates than another; that the
national committee had followed the example set by Mr. Roosevelt when he
forced Mr. Taft's nomination in 1908 by using southern delegations
against the real Republican states which had instructed for other
candidates; and that what was sauce for the goose was sauce for the
gander. Whatever may be the merits of the technical claims made on both
sides, it seems fair to say that Mr. Roosevelt, according to all
available signs, particularly the vote in the primaries in the strategic
states, was the real choice of the Republican party.

The struggle over the contested seats was carried into the convention,
and after a hot fight, Mr. Taft's forces were victorious. When at
length, as Mr. Bryan put it, "the credentials committee made its last
report and the committee-made majority had voted itself the convention,"
Mr. Roosevelt's supporters on Saturday, June 22, after a week's
desperate maneuvering, broke with the Republican assembly. A statement
prepared by Mr. Roosevelt was read as a parting shot. "The convention,"
he said, "has now declined to purge the roll of the fraudulent delegates
placed thereon by the defunct national committee, and the majority which
has thus indorsed the fraud was made a majority only because it
included the fraudulent delegates themselves who all sat as judges on
one another's cases.... The convention as now composed has no claim to
represent the voters of the Republican party.... Any man nominated by
the convention as now constituted would merely be the beneficiary of
this successful fraud; it would be deeply discreditable to any man to
accept the convention's nomination under these circumstances; and any
man thus accepting it would have no claim to the support of any
Republican on party grounds and would have forfeited the right to ask
the support of any honest man of any party on moral grounds."

Mr. Roosevelt's severe arraignment of men who had been his bosom friends
and chief political advisers and supporters filled with astonishment
many thoughtful observers in all parties who found it difficult to
account for his conduct. In Mr. Roosevelt's bitter speech at the
Auditorium mass meeting on the evening of June 17, 1912, a sharp line
was drawn between the "treason" of the Republican "Old Guard" and the
"purity" of his supporters. Of this, Mr. Bryan said, with much irony:
"He carried me back to the day when I first learned of this world-wide,
never-ending contest between the beneficiaries of privilege and the
unorganized masses; and I can appreciate the amazement which he must
feel that so many honest and well-meaning people seem blind or
indifferent to what is going on. I passed through the same period of
amazement when I first began to run for President. My only regret is
that we have not had the benefit of his powerful assistance during the
campaigns in which we have protested against the domination of politics
by predatory corporations. He probably feels more strongly stirred to
action to-day because he was so long unconscious of the forces at work
thwarting the popular will. The fact, too, that he has won prestige and
position for himself and friends through the support of the very
influences which he now so righteously denounces must still further
increase the sense of responsibility which he feels at this time.... He
ought to find encouragement in my experience. I have seen several
campaigns end in a most provoking way, and yet I have lived to see a
Republican ex-President cheered by a Republican audience for denouncing
men who, only a few years ago, were thought to be the custodians of the
nation's honor."[90]

When Mr. Roosevelt definitely broke with the Republican convention, most
of his followers left that assembly, and the few that stayed behind
there refused to vote on roll call. The substantial "rump" which
remained proceeded with the business as if nothing had happened, and
renominated Mr. Taft and Mr. Sherman as the candidates of the Republican
party. The regulars retained the battle field, but they could not fail
to recognize how forlorn was the hope that led them on.

On examining the vote on Mr. Root and Mr. McGovern, as candidates for
temporary chairman, it becomes apparent that the real strength of the
party was with Mr. Roosevelt. The former candidate, representing the
conservative wing, received the overwhelming majority of the votes of
the southern states, like Alabama, Georgia, Louisiana, Mississippi, and
Virginia, where the Republican organization was a political sham; he did
not carry the majority of the delegates of a single one of the strategic
Republican states of the North except Indiana, Iowa, Michigan, and New
York. Massachusetts and Wisconsin were evenly divided; but the other
great Republican states were against him. Minnesota, Nebraska, New
Jersey, North and South Dakota were solid for McGovern. Ohio gave
thirty-four of her thirty-eight votes for him; Illinois, forty-nine out
of fifty-eight; California, twenty-four out of twenty-six; Kansas,
eighteen out of twenty; Oregon, six out of nine; Pennsylvania,
sixty-four out of seventy-six. In nearly every state where there had
been a preferential primary Mr. Roosevelt had carried the day. Mr. Root
won by a vote of 558 to 501 for Mr. McGovern. It was a victory, but it
bore the sting of death. When he stepped forward to deliver his address,
the applause that greeted him was broken by cries of "Receiver of stolen
goods."

If the supporters of Mr. Taft in the convention had any doubts as to the
character of the methods employed to secure his nomination or the
conduct of the convention itself, they were more than repaid for their
labors by what they believed to be the salvation of the party in the
hour of a great crisis. To them, the attacks on the judiciary,
representative institutions, and the established order generally were so
serious and so menacing that if high-handed measures were ever justified
they were on that occasion. The instruments which they employed were
precisely those which had been developed in party usage and had been
wielded with kindred results in 1908 by the eminent gentleman who
created so much disturbance when he fell a victim to them. Mr. Taft's
supporters must have foreseen defeat from the hour when the break came,
but they preferred defeat in November to the surrender of all that the
party had stood for since the Civil War.

The Republican platform was not prolix or very specific, but on general
principles it took a positive stand. It adhered to the traditional
American doctrine of individual liberty, protected by constitutional
safeguards and enforced by the courts; and it declared the recall of
judges to be "unnecessary and unwise." It announced the purpose of the
party to go forward with a program of social legislation, but it did not
go into great detail on this point. President Taft's policy of
submitting justiciable controversies between nations to arbitration was
indorsed. The amendment of the Sherman law in such a manner as to make
the illegal practices of trusts and corporations more specific was
favored, and the creation of a Federal trade commission to deal with
interstate business affected with public use was recommended. The
historic views of the party on the tariff were restated and sound
currency and banking legislation promised. The insinuation that the
party was reactionary was repudiated by a declaration that it had always
been a genuinely progressive party, never stationary or reactionary, but
always going from the fulfillment of one pledge to another in response
to public need and popular will.

In his acceptance speech, Mr. Taft took issue with all the radical
tendencies of the time and expressed his profound gratitude for the
righteous victory at Chicago, where they had been saved from the man
"whose recently avowed political views would have committed the party to
radical proposals involving dangerous changes in our present
constitutional form of representative government and our independent
judiciary." The widespread popular unrest which forced itself upon the
attention of even the most indifferent spectators, Mr. Taft attributed
to the sensational journals, muckraking, and demagogues, and he declared
that the equality of opportunity preached by the apostles of social
justice "involves a forced division of property and that means
socialism." In fact, in his opinion, the real contest was at bottom one
over private property, and the Democratic and Progressive parties were
merely aiding the Socialists in their attack upon this institution. He
challenged his opponents to show how the initiative, referendum, and
recall would effect significant economic changes: "Votes are not bread,
constitutional amendments are not work, referendums do not pay rent or
furnish houses, recalls do not furnish clothes, initiatives do not
supply employment, or relieve inequalities of condition or of
opportunity." In other words he took a firm stand against the whole
range of "radical propositions" advanced by "demagogues" to "satisfy
what is supposed to be popular clamor."

       *       *       *       *       *

The Democrats looked upon the Republican dissensions with evident
satisfaction. When the time for sifting candidates for 1912 arrived,
there was unwonted bustle in their ranks, for they now saw a greater
probability of victory than at any time in the preceding sixteen years.
The congressional elections of 1910, the division in the Republican
party, and discontent with the prevailing order of things manifest
throughout the country, all pointed to a possibility of a chance to
return to the promised land from which they had been driven in 1897. And
there was no lack of strong presidential "timber." Two of the recently
elected Democratic governors, Harmon, of Ohio, and Wilson, of New
Jersey, were assiduously "boomed" by their respective contingents of
supporters. Mr. Bryan, though not an avowed candidate, was still
available and strong in his western battalions. Mr. Champ Clark, Speaker
of the House of Representatives, and Mr. Oscar Underwood, chairman of
the ways and means committee, likewise loomed large on the horizon as
possibilities.

In the primaries at which delegates to the convention were chosen a
great division of opinion was manifested, although there was a
considerable drift toward Mr. Clark. No one had anything like a majority
of the delegates, but the Speaker's popular vote in such significant
states as Illinois showed him to be a formidable contestant. But Mr.
Clark soon alienated Mr. Bryan by refusing to join him in a movement to
prevent the nomination of a conservative Democrat, Mr. Alton B. Parker,
as temporary chairman of the convention which met at Baltimore on June
25. Although at one time Mr. Clark received more than one half of the
votes (two thirds being necessary to nominate) his doom was sealed by
Mr. Bryan's potent opposition.

Mr. Wilson, on the other hand, gained immensely by this predicament in
which the Speaker found himself. He was easily the second candidate in
the race, as the balloting showed, and his availability was in many
respects superb. He was new to politics, and thus had few enemies. He
had long been known as a stanch conservative of the old school; and
although he apparently had not broken with his party in the stormy days
of 1896, it was publicly known that he had wished Mr. Bryan to be
"knocked into a cocked hat." In his printed utterances he was on record
against the newer devices, such as the initiative and referendum, and he
therefore commanded the respect and confidence of eastern Democrats. As
governor of New Jersey, however, his policies had appealed to the
progressive sections of his party, without seriously alienating the
other wing. He had pushed through an elaborate system of direct primary
legislation, a public utilities bill after the fashion of the Wisconsin
system, and a workmen's compensation law. On a western tour he met Mr.
Bryan on such happy terms that their cordiality seemed to be more than
ostensible, and at about the same time he declared himself in favor of
the initiative and referendum. His friends held that the conservative
scholar had been made "progressive" by practical experience; his enemies
contended that he was playing the political game; and his managers were
able to make use of one record effectively in the West and another
effectively in the East. Having the confidence, if not the cordial
support, of the conservatives and the great weight of Mr. Bryan's
influence on his side, he was able to win the nomination on the
forty-sixth ballot taken on the seventh day of the convention.

The Democratic platform adopted at Baltimore naturally opened with a
consideration of the tariff question, reiterating the ancient principle
that the government "under the Constitution has no right or power to
impose or collect tariff duties except for the purpose of revenue."
President Taft's action in vetoing the tariff bills was denounced, and
an immediate, downward revision was demanded. Recognizing the intimate
connection between the tariff and business, the Democrats proposed to
reach their ultimate ideal by "legislation that will not injure or
destroy legitimate industry." On the trust question, the platform took a
positive stand, demanding the enforcement of the criminal provisions of
the law against trust officials and the enactment of additional
legislation to make it "impossible for a private monopoly to exist in
the United States." The action of the Republican administration in
"compromising with the Standard Oil Company and the Tobacco Trust" was
condemned, and the judicial construction of the Sherman law criticized.
The valuation of railways was favored; likewise a single term for the
President of the United States, anti-injunction laws, currency
legislation, presidential primaries, and the declaration of the nation's
purpose to establish Philippine independence at the earliest practicable
moment.

Mr. Wilson's speech of acceptance partook of the character of an essay
in political science rather than of a precise definition of party
policies. He spoke of an awakened nation, impatient of partisan
make-believe, hindered in its development by circumstances of privilege
and private advantage, and determined to undertake great things in the
name of right and justice. Departing from traditions, he refused to
discuss the terms of the Baltimore platform, which he dismissed with the
short notice that "the platform is not a program." He devoted no little
attention to the spirit of "the rule of the people" as opposed to the
rule by an inner coterie of the privileged, but he abstained from
discussing directly such matters as the initiative, referendum, and
recall. He announced his clear conviction that the only safe and
legitimate object of a tariff was to raise duties, but he cautioned his
party against radical and sudden legislation. He promised to support
legislation against the unfair practices of corporations in destroying
competition; but he gave no solace to those who expected a vigorous
assault on trusts as such.

Indeed, Mr. Wilson refused to commit himself to the old concept of
unrestricted competition and petty business. "I am not," he said, "one
of those who think that competition can be established by law against
the drift of a world-wide economic tendency.... I am not afraid of
anything that is normal. I dare say we shall never return to the old
order of individual competition and that the organization of business
upon a great scale of cooperation is, up to a certain point, itself
normal and inevitable." Nevertheless, he hoped to see "our old free,
cooperative life restored," and individual opportunity widened. To the
working class he addressed a word of assurance and confidence: "The
working people of America ... are of course the backbone of the Nation.
No law that safeguards their lives, that improves the physical and moral
conditions under which they live, that makes their hours of labor
rational and tolerable, that gives them freedom to act in their own
interest, and that protects them where they cannot protect themselves,
can properly be regarded as class legislation." As to the Philippines,
he simply said that we were under obligations to make any arrangement
that would be serviceable to their freedom and development. The whole
address was characterized by a note of sympathy and interest in the
common lot of the common people, and by an absence of any concrete
proposals that might discourage or alarm the business interests of the
country. It was a call to arms, but it did not indicate the weapons.

Mr. Wilson's speech had that delightful quality of pleasing all sections
of his party. The _New York Times_ saw in it a remarkable address, in
spite of what seemed to be a certain remoteness from concrete issues,
and congratulated the country that its tone and argument indicated a
determination on the part of the candidate to ignore the Baltimore
platform. Mr. Bryan, on the other hand, appeared to be immensely pleased
with it. "Governor Wilson's speech accepting the Democratic nomination,"
he said, "is original in its method of dealing with the issues of the
campaign. Instead of taking up the platform plank by plank, he takes the
central idea of the Denver platform [of 1908, Mr. Bryan's own, more
radical still]--an idea repeated and emphasized in the Baltimore
platform--and elaborates it, using the various questions under
consideration to illustrate the application of the principle.... Without
assuming to formulate a detailed plan for dealing with every condition
which may arise, he lifts into a position of extreme importance the
dominating thought of the Baltimore platform and appeals to the country
for its cooperation in making popular government a reality throughout
the land."[91]

       *       *       *       *       *

While the Republicans and Democrats were bringing their machinery into
action, the supporters of Mr. Roosevelt were busy forming the
organization of a new party. At a conference held shortly after the
break with the Republican convention, a provisional committee had been
appointed, and on July 8, a call was issued for the "Progressive"
convention, which duly assembled on August 5 at Chicago. This party
assembly was sharply marked by the prominence assigned to women for the
first time in a political convention. Eighteen of the delegates were
women, and Miss Jane Addams, of the Hull House, made one of the
"keynote" speeches of the occasion. Even hostile newspapers were forced
to admit that no other convention in our history, except possibly the
first Republican convention of 1856, rivaled it in the enthusiasm and
devotion of the delegates. The typical politician was conspicuous by his
absence, and a spirit of religious fervor rather than of manipulation
characterized the proceedings. Mr. Roosevelt made a long address, his
"Confession of Faith," in which he took a positive stand on many
questions which he had hitherto met in evasive language, and a platform
was adopted which marked a departure from the old party pronouncements,
in that it stated the principles with clarity and in great detail.

The Progressive platform fell into three parts: political reforms, labor
and social measures, and control of trusts and combinations. The first
embraced declarations in favor of direct primaries, including
preferential presidential primaries, popular election of United States
Senators, the short ballot, the initiative, referendum, and recall, an
easier method of amending the Federal Constitution, woman suffrage,
limitation and publicity of campaign expenditures, and the recall of
judicial decisions in the form of a popular review of any decision
annulling a law passed under the police power of the state. The program
of labor and social legislation included the limitation of the use of
the injunction in labor disputes, prohibition of child labor, minimum
wage standards for women, the establishment of minimum standards as to
health and safety of employees and conditions of labor generally, the
creation of a labor department at Washington, and the improvement of
country life.

The Progressives took a decided stand against indiscriminate trust
dissolutions, declaring that great combinations were in some degree
inevitable and necessary for national and international efficiency. The
evils of stock watering and unfair competitive methods should be
eliminated and the advantages and economies of concentration conserved.
To this end, they urged the establishment of a Federal commission to
maintain a supervision over corporations engaged in interstate commerce,
analogous to that exercised by the Interstate Commerce Commission. As to
railway corporations, they favored physical valuation. They demanded the
retention of the natural resources, except agricultural lands, by the
governments, state and national, and their utilization for public
benefit. They favored a downward revision of the tariff on a protective
basis, income and inheritance taxes, the protection of the public
against stock gamblers and promoters and public ownership of railways in
Alaska.

       *       *       *       *       *

In spite of the exciting contests over nomination in both of the old
parties, the campaign which followed was extraordinarily quiet.[92] The
popular vote shows that the issues failed to enlist confidence or
enthusiasm. Mr. Roosevelt polled about 700,000 more votes than Mr. Taft,
but their combined vote was less than that polled by the latter in 1908,
and slightly less than that received by the former in 1904. Mr. Wilson's
vote was more than 100,000 less than that received by Mr. Bryan in 1896
or 1908. The combined Progressive and Republican vote was 1,300,000
greater than the Democratic vote. If we add the votes cast for Mr. Debs,
the Socialist candidate, and the vote received by the other minor
candidates to the Progressive and Republican vote we have a majority of
nearly two and one half millions against Mr. Wilson. Yet Mr. Wilson,
owing to the division of the opposition, secured 435 of the 531
electoral votes. The Democrats retained possession of the House of
Representatives and secured control of the Senate. The surprise of the
election was the large increase in the Socialist vote, from 420,000 in
1908 to 898,000, and this in spite of the socialistic planks in the
Progressive platform which were expected to capture a large share of the
voters who had formerly gone with the Socialists by way of protest
against the existing parties.

These figures should not be taken to imply that had either Mr. Taft or
Mr. Roosevelt been eliminated the Democrats would have been defeated. On
the contrary, Mr. Wilson would have doubtless been elected if the
Republicans had nominated Mr. Roosevelt or if the Progressives had
remained out of the field. Nevertheless, the vote would seem to indicate
that the Democratic party had no very clear and positive majority
mandate on any great issue. However that may be, the policy of the party
as outlined by its leader and victorious candidate deserves the most
careful analysis.

       *       *       *       *       *

In the course of the campaign, Mr. Wilson discussed in general terms all
of the larger issues of the hour, emphasizing particularly the fact that
an economic revolution had changed the questions of earlier years, but
always speaking of "restoration" and a "recurrence" to older
liberties.[93] "Our life has broken away from the past. The life of
America is not the life that it was twenty years ago; it is not the life
that it was ten years ago. We have changed our economic conditions,
absolutely, from top to bottom; and with our economic society, the
organization of our life. The old political formulas do not fit present
problems; they read like documents taken out of a forgotten age. The
older cries sound as if they belonged to a past which men have almost
forgotten.... Society is looking itself over, in our day, from top to
bottom; is making fresh and critical analysis of its very elements; is
questioning its oldest practices as freely as its newest, scrutinizing
every arrangement and motive of its life; and it stands ready to attempt
nothing less than a radical reconstruction which only frank and honest
counsels and the forces of generous cooperation can hold back from
becoming a revolution."

One of the most significant of the many changes which constituted this
new order was, in Mr. Wilson's opinion, the mastery of the government by
the great business interests. "Suppose you go to Washington and try to
get at your government. You will always find that while you are politely
listened to, the men really consulted are the men who have the biggest
stake--the big bankers, the big manufacturers, the big masters of
commerce, the heads of railroad corporations and of steamship
corporations.... The government of the United States at present is a
foster-child of the special interests. It is not allowed to have a will
of its own.... The government of the United States in recent years has
not been administered by the common people of the United States."

Nevertheless, while deploring the control of the government by "big
business," Mr. Wilson made no assault on that type of economic
enterprise as such. On the contrary, he differentiated between big
business and the trust very sharply in general terms. "A trust is an
arrangement to get rid of competition, and a big business is a business
that has survived competition by conquering in the field of
intelligence and economy. A trust does not bring efficiency to the aid
of business; it buys efficiency out of business. I am for big business
and I am against the trusts. Any man who can survive by his brains, any
man who can put the others out of the business by making the thing
cheaper to the consumer at the same time that he is increasing its
intrinsic value and quality, I take off my hat to, and I say: 'You are
the man who can build up the United States, and I wish there were more
of you.'" Whether any big business in the staple industries had been
built up by this process, he did not indicate; neither did he discuss
the question as to whether monopoly might not result from the
destruction of competitors as well as from the fusion of competitors
into a trust.

On this distinction between big business and trusts Mr. Wilson built up
his theory of governmental policy. The trust, he said, was not a product
of competition at all, but of the unwillingness of business men to meet
it--a distinction which some were inclined to regard as academic.
Because the formation of no great trusts had been unaccompanied by
unfair practices, Mr. Wilson seemed to hold that no such concern would
have been built up had unfair practices been prohibited. Obviously,
therefore, the problem is a simple one--dissolve the trusts and prevent
their being reestablished by prohibiting unfair practices and the arts
of high finance.

Indeed, such was Mr. Wilson's program. "Our purpose," he says, "is the
restoration of freedom. We purpose to prevent private monopoly by law,
to see to it that the methods by which monopolies have been built up
are made impossible." Mr. Wilson's central idea was to clear the field
for the restoration of competition as it existed in the early days of
mechanical industry. "American industry is not free, as it once was
free; American enterprise is not free; the man with only a little
capital is finding it harder to get into the field, more and more
impossible to compete with the big fellow. Why? Because the laws of this
country do not prevent the strong from crushing the weak."

"Absolutely free enterprise" was Mr. Wilson's leading phrase. "We design
that the limitations on private enterprise shall be removed, so that the
next generation of youngsters, as they come along, will not have to
become proteges of benevolent trusts, but will be free to go about
making their own lives what they will; so that we shall taste again the
full cup, not of charity, but of liberty." The restoration of freedom
for every person to go into business for himself was the burden of his
appeal: "Are you not eager for the time when the genius and initiative
of all the people shall be called into the service of business?... when
your sons shall be able to look forward to becoming not employees, but
heads of some small, it may be, but hopeful business, where their best
energies shall be inspired by the knowledge that they are their own
masters with the paths of the world before them ... and every avenue of
commercial and industrial activity leveled for the feet of all who would
tread it?"

Mr. Wilson's economic system seems to be susceptible of the following
summary. The great trusts are "unnatural products," not of competition,
but of the unwillingness of men to face competition and of unfair
practices. Big business is the product of genuine services to the
community, and it should be allowed to destroy whom it can by fairly
underselling honest goods. The enemy is, therefore, the trust; it is the
trust which prevents everybody who would from becoming his own master in
some small business; it is the trust that has taken away the "freedom"
which we once had in the United States. The remedy is inevitably the
dissolution of the trusts, the prohibition of unfair practices in
competition--then will follow as night the day that perfect freedom
which is as new wine to a sick nation. With competition "restored" and
maintained by government prosecution of offenders, no one need have a
master unless he chooses.

Mr. Wilson's opponents saw in this simple industrial program nothing
more than the old gospel of Adam Smith and Ricardo--the gospel of
_laissez faire_ and individualism. They asked him to specify, for
example, into how many concerns the Steel Trust should be dissolved in
order to permit the man with brains and a few thousand dollars capital
to get into the steel business. They asked him to name a catalogue of
"unfair practices" which were to be prohibited in order to put
competition on a "free and natural" basis. They asked him to state just
how, with the present accumulation of great capitals in the hands of a
relatively few, the poor but industrious person with small capital could
meet the advantages afforded by large capitals. They inquired whether
England in the middle of the nineteenth century, with this perfect
industrial ideal and free trade besides, presented the picture of
utopian liberty which the new freedom promised.

To this demand for more particulars, Mr. Wilson replied that he was not
discussing "measures or programs," but was merely attempting "to express
the new spirit of our politics and to set forth, in large terms, which
may stick in the imagination, what it is that must be done if we are to
restore our politics to their full spiritual vigor again, and our
national life whether in trade, in industry, or in what concerns us only
as families and individuals, to its purity, its self-respect, and its
pristine strength and freedom."

For the concrete manifestation of his general principles Mr. Wilson
referred to his practical achievements in New Jersey, although at the
time of the campaign he had not yet put through his program of trust
legislation--a fact which was not overlooked by his opponents. He
referred to his public service commission law, modeled on that which had
been in effect for some time in Wisconsin. "A year or two ago we got our
ideas on the subject enacted into legislation. The corporations involved
opposed the legislation with all their might. They talked about
ruin,--and I really believe they did think they would be somewhat
injured. But they have not been. And I hear I cannot tell you how many
men in New Jersey say: 'Governor, we were opposed to you; we did not
believe in the things you wanted to do, but now that you have done them,
we take off our hats. That was the thing to do, it did not hurt us a
bit; it just put us on a normal footing; it took away suspicion from
our business.' New Jersey, having taken the cold plunge, cries out to
the rest of the states, 'Come on in! The water's fine.'"

In another place, Mr. Wilson summed up his program of redemption in New
Jersey: a workman's compensation act, a public service corporations law,
and a corrupt practices act. This program of legislation was viewed by
Mr. Wilson as an extraordinary achievement. "What was accomplished?" he
asked. "Mere justice to classes that had not been treated justly
before.... When the people had taken over the control of the government,
a curious change was wrought in the souls of a great many men; a sudden
moral awakening took place, and we simply could not find culprits
against whom to bring indictments; it was like a Sunday School, the way
they obeyed the laws."

It was on his theory of the trusts that Mr. Wilson based his opposition
to all attempts at government regulation. Under the plan of regulation,
put forward by the Progressives, said Mr. Wilson, "there will be an
avowed partnership between the government and the trusts. I take it the
firm will be ostensibly controlled by the senior member. For I take it
that the government of the United States is at least the senior member,
though the younger member has all along been running the business....
There is no hope to be seen for the people of the United States until
the partnership is dissolved. And the business of the party now
intrusted with power is to dissolve it." In other words, the government
was, in his opinion, too weak to force the trusts to obey certain rules
and regulations, but it was strong enough to take their business away
from them and prevent their ever getting together again. Apparently, Mr.
Wilson did not expect to find that cordial cooperation from the national
trust magnates which he found on the part of New Jersey public service
corporations when he undertook to regulate them.

Mr. Wilson's political program was more definite. His short experience
in New Jersey politics had evidently wrought great changes in his
earlier academic views. In 1907, he thought that the United States
Senate, "represents the country as distinct from the accumulated
populations of the country, much more fully and much more truly than the
House of Representatives does." In the presidential campaign, he
advocated popular election of United States Senators, principally on the
ground "that a little group of Senators holding the balance of power has
again and again been able to defeat programs of reform upon which the
whole country has set its heart." He did not attack the Senate as a
body, but he thought sinister influences had often been at work there.
However, Mr. Wilson declared that the popular election of Senators was
not inconsistent with "either the spirit or the essential form of the
American government."

As to those other devices of direct democracy, the initiative,
referendum, and recall, Mr. Wilson admitted that there were some states
where it was premature to discuss them, and added that in some states it
might never be necessary to discuss them. The initiative and referendum,
he approved as a sort of "gun behind the door," to be used rarely when
representative institutions failed; and as to the recall he remarked,
"I don't see how any man grounded in the traditions of American affairs
can find any valid objection to the recall of administrative officers."
The recall of judges, however, he opposed positively and without
qualification, pointing out that the remedy for evils in the judicial
system lay in methods of nomination and election.

Such was the economic and political philosophy of the new Democratic
President inaugurated on March 4, 1913.

FOOTNOTES:

     [84] _Autobiography_, p. 476.

     [85] La Follette, _Autobiography_, pp. 516 ff.

     [86] _Autobiography_, pp. 480 ff., 543 f., 551, 700, 740.

     [87] See above, p. 314.

     [88] La Follette, _Autobiography_, p. 616.

     [89] Above, p. 288.

     [90] _A Tale of Two Conventions_, p. 27.

     [91] W. J. Bryan, _A Tale of Two Conventions_, p. 228.

     [92] The most startling incident was the attempt of a maniac
     at Milwaukee to assassinate Mr. Roosevelt.

     [93] These speeches were reprinted in _The New Freedom_ after
     the election.




APPENDIX


PRESIDENTIAL ELECTIONS, 1876-1912

  -----+--------------------+------+------+---------+---------+-----+
  YEAR |                    |      |      |         |         |     |
   OF  |     CANDIDATES     |      |POLIT-|         |         |ELEC-|
  ELEC-|        FOR         |      | ICAL | POPULAR |         |TORAL|
  TION |     PRESIDENT      |STATES|PARTY |  VOTE   |PLURALITY|VOTE |
  -----+--------------------+------+------+---------+---------+-----+
  1876 |Samuel J. Tilden    |N. Y. |Dem.  |4,284,885|  250,935| 184 |
       |Rutherford B. Hayes*|O.    |Rep.  |4,033,950|         | 185 |
       |Peter Cooper        |N. Y. |Gre'nb|   81,740|         |     |
       |Green Clay Smith    |Ky.   |Pro.  |    9,522|         |     |
       |James B. Walker     |Ill.  |Amer. |    2,636|         |     |
  -----+--------------------+------+------+---------+---------+-----+
  1880 |James A. Garfield*  |O.    |Rep.  |4,449,053|    7,018| 214 |
       |W. S. Hancock       |Pa.   |Dem.  |4,442,035|         | 155 |
       |James B. Weaver     |Iowa  |Gre'nb|  307,306|         |     |
       |Neal Dow            |Me.   |Pro.  |   10,305|         |     |
       |John W. Phelps      |Vt.   |Amer. |      707|         |     |
  -----+--------------------+------+------+---------+---------+-----+
  1884 |Grover Cleveland*   |N. Y. |Dem.  |4,911,017|   62,683| 219 |
       |James G. Blaine     |Me.   |Rep.  |4,848,334|         | 182 |
       |John P. St. John    |Kan.  |Pro.  |  151,809|         |     |
       |Benjamin F. Butler  |Mass. |Gre'nb|  133,825|         |     |
       |P. D. Wigginton     |Cal.  |Amer. |         |         |     |
  -----+--------------------+------+------+---------+---------+-----+
  1888 |Grover Cleveland    |N. Y. |Dem.  |5,440,216|         | 168 |
       |Benjamin Harrison*  |Ind.  |Rep.  |5,538,233|   98,017| 233 |
       |Clinton B. Fisk     |N. J. |Pro.  |  249,907|         |     |
       |Alson J. Streeter   |Ill.  |U. L. |  148,105|         |     |
       |R. H. Cowdry        |Ill.  |U'd L.|    2,808|         |     |
       |James L. Curtis     |N. Y. |Amer. |    1,591|         |     |
  -----+--------------------+------+------+---------+---------+-----+
  1892 |Grover Cleveland*   |N. Y. |Dem.  |5,556,918|  380,810| 277 |
       |Benjamin Harrison   |Ind.  |Rep.  |5,176,108|         | 145 |
       |James B. Weaver     |Iowa  |Peop. |1,041,028|         |  22 |
       |John Bidwell        |Cal.  |Pro.  |  264,133|         |     |
       |Simon Wing          |Mass. |Soc L.|   21,164|         |     |
  -----+--------------------+------+------+---------+---------+-----+
  1896 |William McKinley*   |O.    |Rep.  |7,104,779|  601,854| 271 |
       |William J. Bryan    |Neb.  |Dem. }|6,502,925|         | 170 |
       |William J. Bryan    |Neb.  |Peop.}|         |         |     |
       |Joshua Levering     |Md.   |Pro.  |  132,007|         |     |
       |John M. Palmer      |Ill.  |N Dem.|  133,148|         |     |
       |Charles H. Matchett |N. Y. |Soc L.|   30,274|         |     |
       |Charles E. Bentley  |Neb.  |Nat.  |   13,969|         |     |
  -----+--------------------+------+------+---------+---------+-----+
  1900 |William McKinley*   |O.    |Rep.  |7,207,923|  849,790| 292 |
       |William J. Bryan    |Neb.  |Dem P.|6,358,133|         | 155 |
       |John G. Woolley     |Ill.  |Pro.  |  208,914|         |     |
       |Wharton Barker      |Pa.   |MP.   |   50,373|         |     |
       |Eugene V. Debs      |Ind.  |Soc D.|   87,815|         |     |
       |Jos. F. Malloney    |Mass. |Soc L.|   39,739|         |     |
       |J. F. R. Leonard    |Ia.   |UC.   |    1,059|         |     |
       |Seth H. Ellis       |O.    |UR.   |    5,698|         |     |
  -----+--------------------+------+------+---------+---------+-----+
  1904 |Theodore Roosevelt* |N. Y. |Rep.  |7,623,486|2,545,515| 336 |
       |Alton B. Parker     |N. Y. |Dem.  |5,077,911|         | 140 |
       |Eugene V. Debs      |Ind.  |Soc.  |  402,283|         |     |
       |Silas C. Swallow    |Pa.   |Pro.  |  258,536|         |     |
       |Thomas E. Watson    |Ga.   |Peop. |  117,183|         |     |
       |Charles H. Corrigan |N. Y. |Soc L.|   31,249|         |     |
  -----+--------------------+------+------+---------+---------+-----+
  1908 |William H. Taft*    |O.    |Rep.  |7,678,908|1,269,804| 321 |
       |William J. Bryan    |Neb.  |Dem.  |6,409,104|         | 162 |
       |Eugene V. Debs      |Ind.  |Soc.  |  420,793|         |     |
       |Eugene W. Chafin    |Ariz. |Pro.  |  253,840|         |     |
       |Thomas E. Watson    |Ga.   |Peo.  |   29,100|         |     |
       |August Gillhaus     |N. Y. |Soc L.|   13,825|         |     |
       |Thos. L. Hisgen     |Mass. |Ind.  |   82,872|         |     |
  -----+--------------------+------+------+---------+---------+-----+
  1912 |Woodrow Wilson*     |N. J. |Dem.  |6,292,718|2,235,289| 435 |
       |William H. Taft     |O.    |Rep.  |3,369,221|         |  15 |
       |Theodore Roosevelt  |N. Y. |Prog. |4,057,429|         |  81 |
       |Eugene V. Debs      |Ind.  |Soc.  |  812,731|         |     |
       |Eugene W. Chafin    |Ariz. |Pro.  |  170,626|         |     |
       |Arthur E. Reimer    |Mass. |Soc L.|   17,312|         |     |
  -----+--------------------+------+------+---------+---------+-----+

  -----+---------------------+------+------+-----
  YEAR |                     |      |      |
   OF  |     CANDIDATES      |      |POLIT-|ELEC-
  ELEC-|        FOR          |      | ICAL |TORAL
  TION |   VICE PRESIDENT    |STATES|PARTY |VOTE
  -----+---------------------+------+------+-----
  1876 |T. A. Hendricks      |Ind.  |Dem.  | 184
       |William A. Wheeler*  |N. Y. |Rep.  | 185
       |Samuel F. Cary       |O.    |Gre'nb|
       |Gideon T. Stewart    |O.    |Pro.  |
       |D. Kirkpatrick       |N. Y. |Amer. |
  -----+---------------------+------+------+-----
  1880 |Chester A. Arthur*   |N. Y. |Rep.  | 214
       |William H. English   |Ind.  |Dem.  | 155
       |B. J. Chambers       |Tex.  |Gre'nb|
       |H. A. Thompson       |O.    |Pro.  |
       |S. C. Pomeroy        |Kan.  |Amer. |
  -----+---------------------+------+------+-----
  1884 |T. A. Hendricks*     |Ind.  |Dem.  | 219
       |John A. Logan        |Ill.  |Rep.  | 182
       |William Daniel       |Md.   |Pro.  |
       |A. M. West           |Miss. |Gre'nb|
       |                     |      |      |
  -----+---------------------+------+------+-----
  1888 |Allen G. Thurman     |O.    |Dem.  | 168
       |Levi P. Morton*      |N. Y. |Rep.  | 233
       |John A. Brooks       |Mo.   |Pro.  |
       |C. E. Cunningham     |Ark.  |U. L. |
       |W. H. T. Wakefield   |Kan.  |U'd L.|
       |James B. Greer       |Tenn. |Amer. |
  -----+---------------------+------+------+-----
  1892 |Adlai E. Stevenson*  |Ill.  |Dem.  | 277
       |Whitelaw Reid        |N. Y. |Rep.  | 145
       |James G. Field       |Va.   |Peop. |  22
       |James B. Cranfill    |Tex.  |Pro.  |
       |Charles H. Matchett  |N. Y. |Soc L.|
  -----+---------------------+------+------+-----
  1896 |Garret A. Hobart*    |N. J. |Rep.  | 271
       |Arthur Sewall        |Me.   |Dem.  | 149
       |Thomas E. Watson     |Ga.   |Peop. |  27
       |Hale Johnson         |Ill.  |Pro.  |
       |Simon B. Buckner     |Ky.   |N Dem.|
       |Matthew Maguire      |N. J. |Soc L.|
       |James H. Southgate   |N. C. |Nat.  |
  -----+---------------------+------+------+-----
  1900 |Theodore Roosevelt*  |N. Y. |Rep.  | 292
       |Adlai E. Stevenson   |Ill.  |Dem P.| 155
       |Henry B. Metcalf     |O.    |Pro.  |
       |Ignatius Donnelly    |Minn. |MP.   |
       |Job Harriman         |Cal.  |Soc D.|
       |Valentine Rommel     |Pa.   |Soc L.|
       |John G. Woolley      |Ill.  |UC.   |
       |Samuel T. Nicholson  |Pa.   |UR.   |
  -----+---------------------+------+------+-----
  1904 |Charles W. Fairbanks*|Ind.  |Rep.  | 336
       |Henry G. Davis       |W. Va.|Dem.  | 140
       |Benjamin Hanford     |N. Y. |Soc.  |
       |George W. Carroll    |Tex.  |Pro.  |
       |Thomas H. Tibbles    |Neb.  |Peop. |
       |William W. Cox       |Ill.  |Soc L.|
  -----+---------------------+------+------+-----
  1908 |James S. Sherman*    |N. Y. |Rep.  | 321
       |John W. Kern         |Ind.  |Dem.  | 162
       |Benjamin Hanford     |N. Y. |Soc.  |
       |Aaron S. Watkins     |O.    |Pro.  |
       |Samuel Williams      |Ind.  |Peo.  |
       |Donald L. Munro      |Va.   |Soc L.|
       |John Temple Graves   |Ga.   |Ind.  |
  -----+---------------------+------+------+-----
  1912 |Thomas R. Marshall*  |Ind.  |Dem.  | 435
       |Herbert S. Hadley    |Mo.   |Rep.  |  15
       |Hiram W.  Johnson    |Cal.  |Prog. |  81
       |Emil Seidel          |Wis.  |Soc.  |
       |Aaron S. Watkins     |O.    |Pro.  |
       |August Gillhaus      |N. Y. |Soc L.|
  -----+---------------------+------+------+-----
  * The candidates starred were elected.  This table is from the
  _World Almanac_. The figures are in some cases slightly different
  from those used in the text, which are taken from Stanwood, _History
  of the Presidency_.




BIBLIOGRAPHY


_Guide to Literature of Current History_

The best general bibliography for handy use is Channing, Hart, and
Turner, _Guide to the Study and Reading of American History_ (new ed.
1912).

G. E. Howard, _Present Political Questions_ (1913)--a valuable syllabus
of current questions with discriminating and full bibliographies
(published by the University of Nebraska).

The Library of Congress publishes useful bibliographies on special
topics of current political and historical interest. A list may be
obtained by addressing the Librarian, Washington, D.C.

An important annual review of the current literature of American history
is to be found in _Writings on American History_; published by
Macmillan, 1906-1908; by the American Historical Association, 1909-1911;
and now by the Yale University Press.

Excellent topical bibliographies are to be found in each of the volumes
in Hart, American Nation Series. The four volumes by Dunning, Sparks,
Dewey, and Latane should be consulted for the period here covered.


_General Works_

The best general treatment of the period from 1877 to 1907 is to be
found in the four volumes of the American Nation Series edited by A. B.
Hart: W. A. Dunning, _Reconstruction: Political and Economic_; E. E.
Sparks, _National Development, 1877-1885_; D. R. Dewey, _National
Problems; 1885-1897_; J. H. Latane, _America as a World Power,
1897-1907_. Each of these volumes contains an excellent bibliography of
political and economic materials.

H. T. Peck, _Twenty Years of the Republic_ (1906)--readable work
covering the period from Cleveland's first administration to 1905.

Edward Stanwood, _History of the Presidency_ (1896 ed.). A second volume
(1912) brings the work down to 1909 and contains the platforms of
1912--useful for political sketches and the platforms and election
statistics.

_The American Year Book_, published since 1910, contains an annual
survey of American political history and constitutional and social
development.

For political and economic matters see the current publications and
proceedings of the American Political Science Association, the American
Economic Association, and the American Sociological Society.


_Personal and Biographical Works_

J. P. Altgeld, _Live Questions_ (1890)--valuable for the radical
movement within the Democratic party.

F. Bancroft, _Speeches, Correspondence and Political Papers of Carl
Schurz_ (1913), 6 vols.

John Bigelow, _Life of Samuel J. Tilden_ (1896).

G. S. Boutwell, _Reminiscences of Sixty Years_ (1902).

Grover Cleveland, _The Independence of the Executive_ (1900);
_Presidential Problems_ (1904)--particularly valuable for the Chicago
strike and the bond issues; G. F. Parker, _Writings and Speeches of
Grover Cleveland_ (1892); A. E. Bergh, _Addresses, State Papers, and
Letters of Grover Cleveland_ (1909).

J. A. Garfield, _Currency Speeches in the House, 1868-1870_; B. A.
Hinsdale, _Works of J. A. Garfield_ (1882-1883) 2 vols.; _Great Speeches
of J. A. Garfield_ (1881).

Benjamin Harrison, _Public Papers and Addresses_ (Govt. Printing Office,
1893); _This Country of Ours_ (1897)--a popular view of the national
government; J. S. Shriver, _Speeches of Benjamin Harrison_ (1891); M. L.
Harrison, _Views of an Ex-President_ [Harrison] (1901).

G. F. Hoar, _Autobiography of Seventy Years_ (1903).

R. M. La Follette, _Autobiography_ (1913)--particularly valuable for the
history of the radical movement within the Republican party and the
origin of the Progressive party.

Wm. McKinley, _Speeches and Addresses from Election to Congress to the
Present Time_ (1893); _Speeches and Addresses, 1897-1900_ (1900); _The
Tariff--a Review of Its Legislation from 1812 to 1896_ (1904); J. S.
Ogilvie, _Life and Speeches of McKinley_ (1896).

L. A. Coolidge, _An Old-Fashioned Senator_ [O. H. Platt] (1910).

Thomas C. Platt, _Autobiography_ (1910).

Theodore Roosevelt, _The New Nationalism_ (1910) contains the famous
speech on that subject and other essays; _An Autobiography_ (1913)--an
intimate view of his political career.

John Sherman, _Recollections of Forty Years_ (1897).

Edward Stanwood, _James G. Blaine_ (1905).

W. H. Taft, _Political Issues and Outlooks_ (1909); _Presidential
Addresses and State Papers_ (1910).

Woodrow Wilson, _The New Freedom_ (1913). An edited collection of
President Wilson's campaign speeches arranged to exhibit in systematic
form his political and economic doctrines.


_Topical Bibliography_

THE ECONOMIC REVOLUTION: Coman, _Economic History of the United
States_ (1911 ed.)--several useful chapters on the period since the
Civil War; R. T. Ely, _Evolution of Industrial Society_ (1906).

TARIFF: Edward Stanwood, _American Tariff Controversies in the
Nineteenth Century_ (1903); F. W. Taussig, _Tariff History of the United
States_ (1910 ed.).

FINANCE: See the annual review in the _American Year Book_; D.
R. Dewey, _Financial History of the United States_ (1903); A. B.
Hepburn, _History of Coinage and Currency in the United States_ (1903);
J. L. Laughlin, _History of Bimetallism in the United States_ (1897); W.
H. Harvey, _Coin's Financial School_ (1894)--the famous work which did
so much to stir up popular sentiment in favor of free silver; W. J.
Bryan, _The First Battle_ (1897)--invaluable for the political aspects
of the question.

TRUSTS: I. M. Tarbell, _The History of the Standard Oil
Company_ (1904); G. H. Montague, _The Rise and Progress of the Standard
Oil Company_ (1903)--more favorable to trusts than the preceding work;
H. D. Lloyd, _Wealth against Commonwealth_ (1894)--a critical attack on
the evil practices of trusts; J. W. Jenks, _The Trust Problem_ (1905
ed.)--study of the methods and causes of trusts; John Moody, _The Truth
about the Trusts_ (1904)--full of valuable historical and statistical
data; W. Z. Ripley, _Trusts, Pools, and Corporations_ (1905)--a useful
collection of historical and descriptive materials.

RAILWAYS: W. Z. Ripley, _Railroads: Rates and Regulation_
(1913)--a monumental and scholarly treatise; E. R. Johnson, _American
Railway Transportation_ (1903); H. S. Haines, _Restrictive Railway
Legislation in the United States_ (1905); B. H. Meyer, _Railway
Legislation in the United States_ (1903).

CIVIL SERVICE: C. R. Fish, _Civil Service and the Patronage_
(1905, Harvard Studies); L. G. Tyler, _Parties and Patronage_ (1888).

POPULISM: S. J. Buck, _The Granger Movement ... 1870-1880_
(1913, Harvard Studies)--important for all aspects of agrarianism for
the period; F. L. McVey, _The Populist Movement_ (1896).

LABOR: R. T. Ely, _The Labor Movement in America_ (1902); T. V.
Powderly, _Thirty Years of Labor_ (1889); John Mitchell, _Organized
Labor_ (1903); T. S. Adams and H. Sumner, _Labor Problems_ (1906).

IMMIGRATION: Frank Warne, _The Immigrant Invasion_ (1913);
Peter Roberts, _The New Immigration_ (1912)--a study of the social and
industrial life of Southeastern Europeans in America; H. P. Fairchild,
_Greek Immigration_ (1911), and _Immigration: a World Movement and its
American Significance_ (1913); P. F. Hall, _Immigration and Its Effects
on the United States_ (1908); I. A. Hourwich, _Immigration and Labor_
(1912)--a study of the economic aspects of immigration and favorable to
a liberal immigration policy; J. W. Jenks and W. J. Lauck, _The
Immigration Problem_ (1912)--particularly valuable for the data
presented.

SOCIALISM: Morris Hillquit, _History of Socialism in the United
States_ (1910); W. J. Ghent, _Mass and Class_ (1904); J. W. Hughan,
_American Socialism of To-day_ (1912); W. E. Walling, _Socialism as It
Is_ (1912). On the newer aspects of socialism and trades-unionism: John
Spargo, _Syndicalism, Industrial Unionism, and Socialism_ (1913); A.
Tridon, _The New Unionism_ (1913); J. G. Brooks, _American Syndicalism_
(1913); W. H. Haywood and F. Bohn, _Industrial Socialism_ (1911); James
O'Neal, _Militant Socialism_ (1912).

WOMEN: Edith Abbott, _Women in Industry_ (1909); E. D. Bullock,
_Selected Articles on the Employment of Women_ (1911); E. B. Butler,
_Women in the Trades_ (1909); R. C. Dorr, _What Eight Million Women
Want_ (1910); I. H. Harper, _Life and Work of Susan B. Anthony_
(1899-1908), _History of the Movement for Woman Suffrage in the United
States_ (1907); E. R. Hecker, _Short History of Woman's Rights_ (1910);
G. E. Howard, _A History of Matrimonial Institutions_ (1904); Helen
Sumner, _Equal Suffrage_ (1909)--a study of woman suffrage in Colorado;
C. P. Gilman, _Woman and Economics_ (1900).

CONTROVERSY OVER THE JUDICIARY: Gilbert Roe, _Our Judicial
Oligarchy_ (1912)--a criticism of recent tendencies in the American
judicial system; B. F. Moore, _The Supreme Court and Unconstitutional
Legislation_ (1913)--a historical survey; W. L. Ransom _Majority Rule
and the Judiciary_ (1912); F. R. Coudert, _Certainty and Justice_
(1913); G. G. Groat, _Attitude of American Courts in Labor Cases_
(1911); C. G. Haines, _The American Doctrine of Judicial Supremacy_
(1914).

POPULAR GOVERNMENT: G. H. Haynes, _The Election of Senators_
(1906)--valuable for the question of popular election; C. A. Beard and
Birl Shultz, _Documents on the Initiative, Referendum and Recall_
(1912); E. P. Oberholtzer, _Initiative, Referendum, and Recall in
America_ (1911); Walter Weyl, _The New Democracy_ (1912); H. Croly, _The
Promise of American Life_ (1909).

THE SOUTH: A. B. Hart, _The Southern South_ (1910); E. G.
Murphy, _Problems of the Present South_ (1904); H. W. Grady, _The New
South_ (1890); W. G. Brown, _The Lower South_ (1902).

THE NEGRO PROBLEM: The Annals of the American Academy of
Political and Social Science for September, 1913, is devoted to articles
on the progress of the negro race during the last fifty years. A. P. C.
Griffin, _Select List of References on the Negro Question_ (1906,
Library of Congress); R. S. Baker, _Following the Color Line_
(1908)--valuable for the handicaps imposed on the negro in the South; J.
M. Mathews, _Legislative and Judicial History of the Fifteenth
Amendment_ (1909); M. W. Ovington, _Half a Man_ (1911)--status of the
negro in New York; T. N. Page, _The Negro_ (1904)--viewed as a Southern
problem; A. H. Stone, _Studies in the American Race Problem_
(1908)--discouraging view of the economic capacities of the negro; B. T.
Washington, _The Negro in the South_ (1907)--useful for economic
matters; and _The Future of the Negro_ (1900); A. B. Hart, _Realities of
Negro Suffrage_ (1905); G. T. Stephenson, _Race Distinctions in American
Law_ (1910).

THE GROWTH OF THE WEST: H. H. Bancroft, _Chronicles of the
Builders of the Commonwealth_ (1891-1892), 7 vols.; J. C. Birge, _The
Awakening of the Desert_ (1912); C. C. Coffin, _The Seat of Empire_
(1871); Katharine Coman, _Economic Beginnings of the Far West_ (1912), 2
vols.--exploration and settlement; J. H. Eckels, _The Financial Power of
the New West_ (1905); F. V. Hayden, _The Great West_ (1880)--resources,
climate, Mormons, and Indians; J. S. Hittell, _The Commerce and
Industries of the Pacific Coast_ (1882); R. P. Porter and others, _The
West_ (1882)--review of social and economic development from the census
of 1880; L. E. Quigg, _New Empires in the Northwest_ (1889)--Dakotas,
Montana, and Washington; Julian Ralph, _Our Great West_ (1893)--survey
of conditions; Joseph Schafer, _A History of the Pacific Northwest_
(1905); W. E. Smyth, _The Conquest of Arid Arizona_ (1900).

MONROE DOCTRINE: J. B. Moore, _History of American Diplomacy_
(1905); J. W. Foster, _A Century of American Diplomacy_ (1901); J. H.
Latane, _Diplomatic Relations of the United States and Spanish America_
(1900); A. B. Hart, _Foundations of American_ _Diplomacy_ (1901); Hiram
Bingham, _The Monroe Doctrine_ (1913)--a severe criticism of the
Doctrine.

THE SPANISH WAR: F. E. Chadwick, _Relations of the United
States and Spain_--excellent for diplomatic affairs; H. C. Lodge, _The
War with Spain_ (1899)--an interesting popular account; H. D. Flack,
_Spanish-American Diplomatic Relations Preceding the War of 1898_
(1906)--a careful analysis of the causes of intervention; George Dewey,
_Autobiography_ (1913).

IMPERIALISM: D. C. Worcester, _The Philippines: Past and
Present_ (1914), 2 vols.--a great and authoritative work by the former
Secretary of the Interior in the Philippines; H. P. Willis, _Our
Philippine Problem_ (1905)--a study of American Colonial policy; J. A.
Leroy, _The Americans in the Philippines_ (1914)--a large and
authoritative work on the early stages of American occupation; F. C.
Chamberlin, _The Philippine Problem_ (1913); J. G. Schurman, _Philippine
Fundamentals_ (1901); Elihu Root, _Collection of Documents Relating to
the United States and Porto Rico_ (1898-1905, Washington); L. S. Rowe,
_The United States and Porto Rico_ (1904); E. S. Wilson, _Political
Development of Porto Rico_ (1906); W. F. Willoughby, _Territories and
Dependencies of the United States_ (1905)--a general work on the
government of the territories.

THE PANAMA CANAL: J. B. Bishop, _The Panama Gateway_ (1913)--an
authoritative general account; W. F. Johnson, _Four Centuries of the
Panama Canal_ (1906).

THE PEACE CONFERENCES: Joseph Choate, _The Two Hague
Conferences_ (1913); J. B. Scott, _The Hague Peace Conferences of 1899
and 1907_ (1909).

AMERICAN INTERESTS IN THE ORIENT: F. F. Millard, _The New Far
East_ (1906)--special reference to American interests in China; P. S.
Reinsch, _World Politics_ (1900).




INDEX


 Aguinaldo, 217

 Alabama, disfranchisement of negroes in, 11

 Aliens, proportion of, 248

 Altgeld, Governor, 108, 160

 American Civic Federation, 251

 American Federation of Labor, 250

 Anti-monopoly party, 138

 Anti-trust cases, 331 ff.

 Anti-trust law (1890), 134

 Arbitration in labor disputes, federal law, 102

 Arbitration, treaties, 1911, 329

 Archbald, Judge, impeachment of, 326

 Arizona, 41 ff.;
   contest over recall of judges, 287

 Army. _See_ Spanish War

 Arthur, Chester A., nomination, 95;
   administration, 97


 Ballinger, R. A., 328

 Blaine, James G., 95;
   candidacy in 1884, 98;
   on silver question, 121

 Bland-Allison bill, 123

 Bonds, sales under Cleveland, 106

 Bourne, Senator, attacks on convention system, 353 ff.

 Bryan, W. J., speech in Democratic convention of 1896, 180;
   nomination of, 187;
   acceptance speech in 1896, 188;
   favors initiative and referendum, 284;
   candidacy in 1900, 227;
   candidacy in 1908, 318 ff.;
   program in 1908, 318;
   attacks Taft's judicial appointments, 330


 Campaign funds, 239, 240 ff.;
   controversy over, in 1904, 268;
   in 1908, 320;
   in 1912, 357

 Campaign, 1896, 195

 Canada, reciprocity with, 342

 Cannon, Speaker, overthrow of, 336 ff.

 Capital, influence of, in politics, 33

 Capitalism, in South, 48; evolution of, 229 ff.
   _See_ Industry _and_ Labor.

 Cervera, Admiral, 210 ff.

 China, opening of, 203;
   American interests in, 224

 Chinese coolies, 35

 Cities, growth of population, 34, 247

 Civil rights act, 14 ff.

 Civil rights cases, 15

 Civil service, and Theodore Roosevelt, 104;
   law of 1883, 130

 Clark, Champ, candidacy of, 365

 Clayton-Bulwer treaty, 276

 Cleveland, Grover, career of, 97;
   nomination and first administration, 98 ff.;
   second administration, 105 ff.;
   tariff message of 1887, 110;
   and income tax, 139;
   bond issues, 162;
   supports Gold Democrats, 193;
   and Venezuela affair, 199;
   and negotiations with Spain, 206

 Coastwise vessels, exemption of, 276

 Colombia, failure of negotiations with, 278

 Combinations, in business, origin of, 36

 Commerce, growth of, 202;
   interstate, 312

 Conkling, Roscoe, sketch of, 51 ff.;
   and Grant's candidacy, 95

 Conservation, Roosevelt's policy, 275

 Consolidated Gas case, 81

 Constitution, provisions relative to money, 119;
   criticism of, 305 ff.

 Convention, presidential, attacks on, 353 ff.

 Corporations, growth of, 235;
   regulation of, 310.
   _See_ Trusts.

 Court, commerce, 326

 Courts, criticism of, 89

 Coxey's army, 107

 Credit Mobilier affair, 31

 Cuba, conditions in, 204;
   war over, 209 ff.;
   settlement of, after the war, 221;
   interference in (1906), 222

 Currency, law of 1908, 197


 Dakota, 41 ff.

 Daniel, J. W., temporary chairman of Democratic convention, 171

 Debs, E. V., imprisonment of, 108;
   and injunctions, 160;
   candidate for President, 298

 Debt, national, refunding of, 117

 De Lome incident, 207

 Democrats, contest against election laws, 4 ff.;
   party platforms, 108 ff.;
   convention of 1896, 168 ff.;
   platform of 1896, 172;
   Gold, convention of 1896, 192 ff.;
   convention and platform of 1904, 267;
   victory in 1910, 339;
   in 1912, 372

 Dewey, victory at Manila, 209

 Dingley tariff, 229

 Direct primary, 289

 Due process. _See_ Fourteenth amendment.


 Economy and efficiency commission, 328

 El Caney, 211

 Election laws, federal, contest over repeal of, 4 ff.

 Employers' liability, federal, 274

 Erie Railway, capitalization of, 39


 Farmers, discontent of, 162

 Farmers' Alliance, 151

 Farm population, 40

 Farms, increase in number, 40;
   size of, in South, 47

 Fifteenth amendment, nullification of, in the South, 1;
   schemes to avoid, 9 ff.

 Finance, high, early experiments in, 39

 Fourteenth Amendment, interpretation of, 54 ff.

 Free silver, discussion by W. J. Bryan, 180 ff.

 Free silver. _See_ Bryan, W. J.


 Garfield, nomination and administration of, 94 ff.;
   assassination, 96

 Georgia, disfranchisement of negroes in, 11

 Gold Democrats, 192 ff.

 Gold standard, Republicans favor in 1896, 166;
   established by law (1900), 197;
   Parker telegram on, 267

 Gompers, Samuel, 251

 Gould, Jay, 38

 Granger cases, 67 ff.

 Granger movement, 147

 Grant, third term contest, 94

 Great Britain, and Venezuela affair, 199

 Greenback party, on income tax, 137;
   doctrines of, 150

 Greenbacks, amount of, 117;
   reissue of, 123

 Guiteau, assassinates Garfield, 96


 Hague conference, 281

 Hancock, General, candidate for the Presidency, 96

 Hanna, M. A., convention of 1895, 165;
   and campaign of 1900, 227;
   career and policies of, 239 ff.

 Harriman, E. H., and controversy with Roosevelt, 270

 Harrison, Benjamin, candidacy and administration, 103 ff.

 Hawaiian Islands, 203

 Hayes, and the South, 1 ff.;
   vetoes repeal of election laws, 5;
   administration of, 92 ff.

 Hay-Pauncefote treaty, 276

 Haywood, W. D., 301

 Hepburn act, 271

 Hill, D. B., in Democratic convention of 1896, 170 ff.

 Hobson, R. P., 210


 Idaho, 41 ff.

 Immigration, 34, 248

 Imperialism, 199 ff.;
   in American politics, 227

 Income tax, law of 1894, 127; 137 ff.;
   annulled by Supreme Court, 152 ff.;
   W. J. Bryan on, 189;
   advocated by Roosevelt, 262;
   amendment to federal constitution, 325

 Industry, in 1860, 29;
   in South, 48. _See_ Labor.

 Industrial Workers of the World, 301

 Initiative and referendum, origin and growth of, 284 ff.;
   in Progressive platform, 371;
   favored by Wilson, 380

 Injunctions, use of, in labor disputes, 36;
   an issue in politics, 158 ff.

 Insular cases, 218 ff.

 Insurance, regulation of, 310


 Japan, opening of, 203;
   American interests in, 224

 Jenks, J. W., on trusts, 238

 Jim Crow cars, 19

 Judicial review, growth of doctrine of, 67 ff.

 Judiciary. _See_ Supreme Court and Recall.


 Knights of Labor, 35, 249

 Ku Klux Klan, 1


 Labor, number of wage earners, 34;
   in South, 48;
   in party platforms, 114;
   and tariff, 115;
   regulation of, 249 ff., 304, 308

 Labor legislation and the courts, 87 ff.;
   Federal, 141

 Labor movement, 249

 Labor problem, rise of, 35

 Labor, Knights of, 35, 249

 Labor Reformers, 35, 145 ff.

 La Follette, R. M., candidacy of, 344 ff.

 _Laissez faire_, and the Constitution, 54 ff.;
   Gold Democrats defend, 192;
   decline of, 304;
   Wilson's view of, 377

 Liberal Republicans, 109

 Lincoln, on social equality for the negro, 21

 Lochner v. New York, 87

 Louisiana, Republican rule in, overthrown, 1 ff.;
   disfranchisement of negroes in, 11


 _Maine_, the battleship, 207

 Manila, naval battle of, 209

 Massachusetts, primary law in, 356

 McKinley, Wm., tariff bill, 126;
   and the gold standard, 167;
   election of, 197;
   administration of, 199 ff.;
   and Spanish war, 206 ff.;
   renomination in 1900, 227;
   election, 228;
   campaign funds of, 241

 Merritt, General, 212

 Mexico, relations with, 342

 Miles, General, 212

 Mills, tariff bill, 126

 Minnesota rate case, 73 ff.

 Mississippi, disfranchisement of negroes in, 10

 Mitchell, John, 250

 Money question. _See_ Silver question.

 Monroe Doctrine, 199 ff.;
   Roosevelt on, 262; 280

 Montana, 41 ff.

 Morgan, J. P., 231

 Mormons, 42 ff.

 Morrison, W. R., and tariff, 126

 Mugwumps, 99

 Munn v. Illinois, 67 ff.


 Nebraska, primary law in, 356

 Negro, disfranchisement of, 1 ff., 7 ff.;
   social discriminations against, 14 ff.;
   attitude of the North toward, 19 ff.;
   problem, 22 ff.; education of, 23;
   in industries, 24;
   movement, 25

 New Mexico, 41 ff.

 New nationalism, 314 ff.

 North Carolina, disfranchisement of negroes in, 11

 North Dakota, 41 ff.

 Northern Pacific, 42


 Oregon, primary law in, 354


 Palmer, J. M., candidate for President, 192

 Panama, canal, sketch of, 275 ff.;
   revolution in, 278

 Paper money. _See_ Greenbacks.

 Parcels post, 327

 Parker, Alton B., nomination and candidacy of, 267 ff.

 Payne-Aldrich tariff, 323 ff.

 Pensions, vetoes by Cleveland, 101;
   law of 1890, 105

 Philippines, military operations in, 209 ff.;
   revolt against the United States, 217;
   government of, 223;
   in American politics, 227;
   Republican platform of 1904 on, 265;
   Democratic platform of 1904 on, 267

 Platt amendment, 221

 Poll tax, to disfranchise negroes, 9

 Populist party, origin of, 149 ff.

 Populists, and disfranchisement of negroes, 9;
   on income tax, 138

 Porto Rico, conquest of, 212;
   government of, 222

 Postal savings banks, 326

 Primary, direct, origin and growth of, 288;
   presidential, 352 ff.;
   presidential, in 1912, 358

 Progressive party, origin of, 357 ff.; 370 ff.

 Progressive Republican League, 344

 Prohibition party, 144 ff.

 Pullman strike, 107

 Pure food law, 273


 Railways, construction of, 29 ff.;
   land grants to, 30;
   frauds connected with, 31;
   anarchy among, 39;
   state regulation of, 67 ff.;
   party platforms on, 113 ff.;
   regulation, federal, 133;
   state regulation of, 149;
   and stock watering, 234;
   regulation of, 272;
   physical valuation of, 273;
   consolidation of, 306

 Reagan _v._ Farmers' Loan and Trust Company, 76 ff.

 Recall, of judges, origin of, 89;
   origin and growth of, 287;
   Wilson on, 380

 Reciprocity with Canada, 341

 Reed, T. B., speakership, 104;
   candidate for President, 165

 Republicans, platform of 1876, 2;
   radical school, 2;
   favor new "force" bill, 20;
   favor enforcing the Civil War amendments, 21;
   doctrines of, 1880-1896, 90 ff.;
   party platforms, 108 ff.;
   convention of 1896, 164 ff.;
   convention of 1900, 226;
   convention of 1904, 265;
   convention of 1912, 357 ff.

 Resumption act, 118

 Rockefeller, J. D., 37

 Roosevelt, at San Juan Hill, 211;
   nominated for Vice President, 227;
   succeeds to the Presidency, 228;
   administrations of, 254 ff.;
   doctrines of, 255 ff.;
   characterization of, by Republicans in 1904, 266;
   Democratic criticism of, in 1904, 268;
   Parker charges as to campaign funds of, 269;
   La Follette's criticism of, 347;
   candidacy of, in 1912, 349 ff.;
   new nationalism, 350;
   breaks with Republicans, 360

 Rough Riders, 211

 Rules committee, powers of, 337

 Russo-Japanese war, Roosevelt's part in ending, 281


 Samoan Islands, 203

 San Juan Hill, 211

 Santiago, military and naval operations near, 210 ff.

 Santo Domingo, affair of, 279

 Senators, U. S., direct election of, 290 ff.;
   popular election favored by Wilson, 380

 Shafter, General, 211 f.

 Sherman, silver purchase act, 124;
   anti-trust law, 134

 Silver question, party platforms on, 116, 162;
   origin and development of, 119 ff.;
   in campaign of 1896, 165 ff.

 Sixteen to one. _See_ Silver question.

 Slaughter-House cases, 59 ff.

 Smyth _v._ Ames, 78

 Socialism, opposition to, 251;
   rise and growth of, 296 f.

 Socialist Labor party, 147, 297

 Socialist party, rise of, 298;
   vote in 1912, 372

 Socialists, vote of, increase in 1904, 271

 South, Republican rule in, 1 ff.;
   new constitutions providing for disfranchisement of negroes, 10 ff.;
   over-representation of, in Congress, 20;
   economic advance of, 46 ff.;
   Republican delegates from, 354

 South Carolina, Republican rule in, overthrown, 1 ff.;
   disfranchisement of negroes in, 11

 South Dakota, 41 ff.;
   initiative and referendum in, 284

 Southern Pacific, 42

 Spain, war with, 204 ff.

 Spanish War, close of, 212 ff.

 Speakership. _See_ Reed _and_ Cannon.

 Standard Oil Company, 37

 State socialism, 252

 Steel trust, 230

 Stock watering, 234

 Strikes, of 1877, 35;
   Pullman, 107

 Suffrage, woman, growth of, 294

 Sugar trust, 239

 Supreme Court, declares parts of election laws invalid, 6 f.;
   and disfranchisement of negroes, 13;
   civil rights cases, 15;
   and Fourteenth Amendment, 54 ff.;
   criticism of, 86;
   and income tax, 152;
   Democratic attack on, in 1806, 173 ff.;
   defense of, 178;
   W. J. Bryan on, 189;
   Gold Democrats defend, 193;
   Taft's appointments, 329


 Taft, W. H., on recall of judges, 287;
   in Philippines 223;
   nomination and election of, 317 ff.;
   administration of, 322 ff.;
   nomination of, in 1912, 362;
   acceptance speech, 364;
   Progressive criticism of, 345

 Tariff, in Cleveland's first administration, 103;
   Wilson bill, 108;
   party doctrines on, 1877-1896, 108 ff.;
   legislation, 1877-1896, 124 ff.;
   Republican platform of 1908 on, 318;
   Payne-Aldrich act, 323 ff.;
   board, 339 f.;
   Democratic attacks on in 1911-1912, 341

 Third term contest, 94

 Tillman, on negro suffrage, 8;
   attack on Cleveland in Democratic convention of 1896, 175

 Trusts, origin of, 37;
   party platforms on, 112;
   law against (1890), 134;
   growth of, 229 ff.;
   views as to cause of, 237;
   Roosevelt on, 257 ff.;
   Bryan on, in 1908, 319;
   Republican platform of 1912, 363;
   Progressive party's platform, 371;
   Wilson's view of, 375 ff.


 Unemployment, in 1894, 107

 Union Labor party, 138, 146

 Union Pacific, scandal of, 31

 Unions, Trade, 301 ff.

 United Labor Party, 146

 United States _v._ Cruikshank, 7

 United States _v._ Harris, 7

 United States _v._ Reese, 7

 Utah, 41 ff.;
   initiative and referendum in, 285


 Vanderbilt, Cornelius, 38

 Venezuela affair, 199

 Vetoes, by Cleveland, 101 f.

 Vilas, Senator, in Democratic convention of 1896, 179

 Virginia, disfranchisement of negroes in, 11;
   _ex parte_, 17


 Wage earners, number of, 34

 Washington, state of, 41 ff.

 West, development of, 41

 Wilson, Wm., tariff bill, 127

 Wilson, Woodrow, candidacy of, 365;
   acceptance speech, 367;
   policies of, 373 ff.

 Women in industries, 248

 Woman suffrage, growth of, 294 ff.;
   endorsed by Progressives, 371

 Wyoming, 41 ff.




    +------------------------------------------------+
    |             Transcriber's note:                |
    |                                                |
    | Inconsistent hyphenation and spelling in the   |
    | original document have been preserved.         |
    |                                                |
    | Typographical errors corrected in the text:    |
    |                                                |
    | Page  38  financeering changed to financiering |
    | Page  50  enterprizes changed to enterprises   |
    +------------------------------------------------+



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