there will be such a panic in this country as the world has never seen,
and with his money ideas and the crazy-headed radicals he will call to
Washington to administer the nation's affairs, business will surely be
destroyed and the working people will suffer untold misery. You know we
all hate to do what Uncle Mark says is necessary, but it's a case of
some of us sacrificing something for the country's good. Bryan's
election would set our country back a century, and I believe it's the
sacred duty of every honest American to do what he can to save his land
from such a calamity."[14]

The "System's" conscience has its own quaint logic--the logic of
self-interest--and this is how it reasoned: "The election of Bryan would
disturb our control of American institutions, therefore American
institutions would be destroyed by Bryan's election. On us, the
'System,' devolves the sacred if expensive duty of saving the nation,
and, however abhorrent to our fine moral sense, patriotism compels us to
spend millions in bribing and corrupting the electorate so that virtue,
'Standard Oil,' and J. P. Morgan may continue the good work of caring
for the public's interests as their own."

As I listened to Rogers' exordium on the duties of a citizen in an
emergency, I remembered the "Standard Oil" code--"Everything for God
(our God); God (our God) in everything." It was so essentially "Standard
Oil," this willingness to commit even that greatest wrong, subverting
the will of the people in the exercise of their highest function--the
election of a President--but only that good (their good) might come of
it. It was no more than selfish greed tricked out in the noble trappings
of morality, an infamous crime disguised as patriotism. Doubtless, the
excellent, God-fearing, law-abiding citizens of the doubtful States who
read this and learn how the "System" defeated their will at the polls
will cry, "Monstrous! Can such things be in America?" and then will
resume their interrupted occupation of "letting well enough alone."
However, this is aside from my story.

Having clearly set forth the political situation through which we should
be saved, Mr. Rogers proceeded to map out my own programme. First, I
must perfect an alibi for him by going to Foster and Braman, and
impressing upon them the fact that he was absolutely out of the affair,
and must under no circumstances be brought into it; next, I must
convince Addicks to the same effect, and in addition tell him that Mr.
Rogers had angrily refused to get into the mix-up; I should then hold
myself in readiness to meet John Moore and Hanna or Osborne as soon as
an appointment could be arranged. That afternoon I got the word and went
to 26 Broadway, and from there Mr. Rogers and I went over to John
Moore's office, slipping in the private door from the rear street.

"John," said Mr. Rogers, "I am going to turn this matter over to you and
Lawson, and I am to have nothing further to do with it. What you two
agree to will be satisfactory to me, and remember, both of you, every
dollar that is paid is paid by the National Committee, but after it's
all settled, and if there is no slip-up, I will look to Lawson for
whatever is expended. Is it understood?"

We agreed that it was, and Mr. Rogers left us.

John Moore deserves more than a mere passing mention here, for he was at
this time a distinguished Wall Street character and one of the ablest
practitioners of finance in the country. During the last fifteen years
of his life, John Moore was party to more confidential financial jobs
and deals than all other contemporaneous financiers, and he handled them
with great skill and high art. Big, jolly, generous, a royal eater and
drinker, an associate of the rich, the friend of the poor, a many-times
millionaire, who a few years before had been logging it on the rivers of
Maine, his native State, John Moore well deserved his "Street" name,
"Prince John." His firm, Moore & Schley, transacted an immense brokerage
business, and numbered among its clients great capitalists and bankers
all over the country. Especially were Moore & Schley famed for their
discretion, and the highest proof of confidence reposed in the firm was
the fact that it did the bulk of the stock speculating for what is known
as "the Washington contingent." This is, perhaps, the most peculiar and
delicate business that comes to "the Street." A big Wall Street house
opens a Washington office and organizes an elaborate system of special
wires, wires from which there can be no possibility of leakage. It is
then ready for the patronage of members of Congress, United States
Senators and national officials, whose honorable positions make them the
custodians of national secrets of great commercial value. If, for
instance, a new law is to be passed which must favorably affect a given
stock, legislators who are on "the inside" often buy thousands of shares
in order to reap the profit of the rise in value incidental to its
passage. Or perhaps there is in prospect a law which will interfere with
the special privilege of some other stock and reduce its price. Those in
possession of advance information "go short" of that stock (sell for
future delivery) to profit by the drop. There are many other
opportunities the Washington "insider" of speculative turn may use to
advantage. For instance, if a high official of the Government were about
to issue a proclamation against a foreign nation, and should desire
secretly to make a million or so out of the panic he knew must follow
the announcement, he would cast about him for a broker who would
preserve this sacred confidence. It would invariably be through the
Moore firm that his secretary or confidential man would do the short
selling. There are also the operations of lobbyists who, to affect
important legislation for this great interest or the other, buy or sell
stock for the benefit of legislators whose votes they desire to
influence. Extreme caution is demanded in the execution of such orders,
or all hands might by some slip-up find themselves wearing striped
suits.[15]

Such a catastrophe seemed imminent some years ago when the Sugar Trust
was before the United States Senate for some legislation necessary to
bolster up its monopoly. Its agents had either been less cautious than
usual in disguising the raw bribery they were perpetrating, or this
particular Senate was too brazen to take the usual precautions to hide
its greed from the world. In any case, so great an outcry was made in
the press of the country that some sacrifice to the people's wrath was
called for--one of those familiar sacrifices which, at intervals of ten
or fifteen years in this republic, our rulers make to the great god
Integrity. An investigation was organized, and a Senatorial inquisition
had before it eminent sugar capitalists and many other distinguished
gentlemen who could by no possibility shed light on the transactions,
and then, realizing that a show of earnestness, at least, was demanded,
it was agreed that some member of Moore & Schley's firm must go on the
witness-stand, and, on refusing to tell which Senators had speculated in
sugar, must be sent to jail. This grandstand play, it was calculated,
and rightly, would so hold the attention of the American people that
when the committee concluded its investigation with the usual loud
acclaim of duty well done, its Draconian punishment of the unsubmissive
broker would act as another ten years' stay against outcry.

When this stratagem was decided on, John Moore announced that he as head
of the firm should be the sacrifice. But the representatives of the
"System" and the Senate firmly refused to assign him that rôle, and
instead, to his grief and anger, nominated for jail the associate member
who had charge of Moore & Schley's Washington business, whom they
declared the logical victim. During the thirty days that his friend and
partner spent behind the bars John Moore's hair whitened more than in
all the years before, and from that time until his death he refused
firmly to take part in his old line of work, or was ever again his old
jovial self.

FOOTNOTES:

[13] Over a year after the publication of this statement startled the
country, John A. McCall, President of the New York Life Insurance Company,
and George W. Perkins, Vice-President of the same company and partner of J.
Pierpont Morgan, were compelled to confess that they had contributed from
their policy-holders' deposits, large amounts of money to a fund to defeat
Bryan in 1896 and to the Republican campaign funds of the two following
presidential elections, and that they gloried in it. At the same time Jacob
Schiff, director of the Equitable Life and a partner in the great
international banking-house of Kuhn, Loeb & Co., admitted that funds
belonging to the policy-holders of the "Big Three," the New York, the
Mutual, and the Equitable, were used in a joint fund to influence the
Legislature of every State in the Union.

[14] President McCall used almost the same language in September, 1905, in
justifying his payment.

[15] The President was notified some few months ago that the cotton report
was being juggled by employees of the United States Department of
Agriculture in the interest of certain Wall Street speculators who were
gambling in cotton. Investigation proved that it was the practice to
falsify the report; and certain Government officials and brokers are now
under indictment.

CHAPTER XXV

ATHLETICS OF FINANCE

Entirely apart from his relationship with Mr. Rogers it was a great help
in this Bay State emergency to have the aid of a man of John Moore's
wealth of vim and wide knowledge of men and affairs. Freely and frankly
I explained our situation to him with its innumerable complications
until he had mastered its intricacies. A tough job he pronounced our
proposition, and he was the authority on the subject. After our talk was
ended he called in Osborne, who had evidently already been talked to. He
said to Osborne:

"I've been over Addicks' affairs with Lawson, and there is no question
in my mind and that of other friends of the party that he should have
what is necessary to carry Delaware. You had better have the committee
ready to put in between $350,000 and $400,000 if we call for it. I will
see that it is kept down as low as possible."

Osborne then spoke his piece and replied that the committee would do
whatever was decided best, and asked me to send Addicks around next day
to explain just how he was pushing things in Delaware. All this was
play-acting for the benefit of Rogers' alibi.

The next thing on my programme was to persuade Addicks to relinquish his
hold on the old Boston gas companies, and this was likely to prove my
most difficult task. I left John Moore, who agreed to hold himself in
readiness at any hour to consult on and approve such settlement as I
could arrange, and energetically started in on the Delaware financier.
It was a trying ordeal. As soon as Addicks saw I had something to work
on he began to demur and object. If he could not have things his way, he
would do nothing. He knew that I had joined a conspiracy to ruin him;
that I was in league with Rogers, who was in league with Braman and
Foster, and that all were banded together to take all he had away from
him. In the course of that two hours' wrestle I was tempted several
times to throw up the whole affair, and there were some bitter and
savage word-passages that left both of us heated. I could do nothing
with him; he must hear from Rogers personally. Finally I got the
"Standard Oil" wire, and Rogers talked so plainly and coldly as
partially to sober him, but ended by agreeing to have his counsel talk
things over with Addicks, which was a distinct concession. A little
later Mr. Rogers' representative was at the Hoffman and he and Addicks
had it hot and heavy. After about fifteen minutes of conference they had
wellnigh come to blows. However, the hot exchanges had begun to tell.
Addicks grew saner, but he insisted on seeing Foster and Braman. I
warned him that he was fast getting our affairs into such shape that no
one could patch them up, but to no avail. He must meet his enemies face
to face if only to ram into their teeth that they were scoundrels.
Finally, I got Braman on the telephone and explained that I was doing my
best to quiet a crazy man, who would consent to nothing until after he
had seen him and Foster and told them what thieves they were. I heard
Braman chuckle. He said: "Bring him along to Foster's house at 10.30,"
and added: "It wouldn't be a bad idea to have an ambulance along, too."
This suggested further complications, for Braman has the reputation on
"the Street" of being more eager to face a wild man on a rampage than a
sick one in a plaster cast, while Foster, although a little bit of a
fellow, was never known to side-step or duck trouble. I slipped word
down to Moore at the Waldorf to follow along to Foster's place in a cab.

There are several "spite houses" in New York. Foster's house was one of
them. It is a narrow strip of a brownstone dwelling at 79 West 54th
Street, built to express the enmity of one property owner for his
neighbor who refused to pay an extortionate price for the land. It is
about the width of a front door, and inside there is just about room to
move around. It afforded a queer background for the scene enacted there
that night.

Promptly at 10.30 Addicks and I were at the door, and by 10.32 the
tunnel-like walls of the "spite house" resounded with as illuminating a
verbal interchange of billingsgate biographies as I have ever listened
to. At 10.35 I covered Addicks in a hasty but quite successful retreat
which he beat to our cab. Thence to the Hoffman House, where I summoned
Parker Chandler to aid in the calming of our raving associate. The next
two hours were of the pulse-jumping, vein-tearing kind incidental to
"frenzied finance," but they were not without avail, for Addicks finally
agreed that he might consent to "something" provided the Bay State
equities in the Boston companies were so preserved that he could
eventually get them back into his hands by repayment to Rogers or by the
redemption of bonds.

Having got thus far, I again went after Braman and Foster, who were at
the Hotel Cambridge. We repaired for further conference to the
University Club, which was then in the old A. T. Stewart marble palace
on the corner of Thirty-fourth Street and Fifth Avenue. I shall never
forget that session. It was past midnight, but the three of us battled
with our smoky problem, now good-naturedly, now bitterly. At times it
looked hopeless because of this obstinate demand or that steadfast
refusal. It must have been three o'clock in the morning when I left them
and stepped into the Waldorf for a moment to relieve Moore's vigil. Then
back again to the Hoffman, where Addicks, Chandler, and some Bay State
directors were nodding. By this time I was in no mood to say more than
that I would be over in the morning, and that Addicks should go early to
the National Committee's head-quarters and explain the desperation of
conditions in Delaware to Hanna, Osborne, and their associates. At last
I was free to return to the Brunswick for a few hours' rest.

In the country, cock-crow is the signal to be up and doing. In the city,
the signal to be up and to do is a hoarse, metallic roar that would
drown a million country cock-crows if each particular cock were as big
as the mythical rooster of antiquity and could crow in proportion to his
size. My readers who dwell on the hills and in dales and wheat-fields,
and who are unfamiliar with the wild, weird early morning din of the
city, may not know that the metropolitan cock-crow is made up of the
jingle and jangle of a million tin milk cans jolted over a million
blocks of stone to the tune of thousands of steel-shod feet, the shrill
cries of an army of butcher and baker boys and the groans and the moans
of countless troubled and tortured human souls. Cock-crow in the country
means "Awake to another day of life." Cock-crow in the city is a signal
for the slaves of Mammon to arise to another interval of flight and
pursuit.

The great city cock was just getting ready to send forth his hoarse cry
as I went to bed, and he was still on his roost a few hours later, when
I awoke. I looked from my window of the Brunswick across the Square, now
flooded with the pure sunlight of early morning, and all the kinks and
quirks and hobgoblins which the rush and irritation of yesterday had
generated seemed to have vanished, and I could not suppress a smile at
the thought of the night before, when this battle--this puny,
insignificant battle for a few dirty dollars--had almost raised feelings
I now knew too well should only be aroused by real battles, battles in
which noble principles were involved, and I felt better able to fight
what I had thought, the night before, was going to be a hard battle.

"Pshaw!" said I, as I looked away and beyond the park to the grand
battlefields of my better imagination, "what will it matter a hundred
years hence what name appears against victor or vanquished in the
archives of fame or the records of infamy when the student reads, 'A.D.
1896, Bay State Gas-"Standard Oil" war,'" for I saw that among the
countless real deeds there would be no room for any record to mark the
existence of any Gas or Dollar war.

With these thoughts still in mind I sat down to breakfast with Parker
Chandler, and as I listened to his cheerful gossip of yesterday, I
inwardly resolved that whatever the result of the day's effort, I would
take it with a smile.

Thursday was another period of strenuous struggle and unceasing effort.
I began early, and every moment was taken up with arguments, wrangles,
pleadings! Chandler had agreed to see that Addicks kept his appointment
with the National Committee and that a quorum of Bay State directors
should be on hand in the Hoffman so that we could get quick action on
any proposition that came up. This arranged I hurried over to see John
Moore, then down for a last word with Mr. Rogers. Addicks came next for
a spell; from him to Braman and Foster; back to John Moore; more
interviews with lawyers and round the circle again. It seemed as though
it were impossible to arrive at any agreement that some one of the
principals interested would not kick over. At four o'clock Friday
morning John Moore and myself ceased our labors for the day, both of us
wellnigh exhausted. With all our efforts many of the vital points to our
agreement were still in the air. A few hours' sleep and we were back at
our task, and by six o'clock on Friday night the last obstacle had been
overcome and the deal was completed.

There remained now the tremendous business of putting all the
arrangements concluded into execution. A multitude of legal documents
had to be drawn up and executed, first by Rogers and then by the Bay
State board of directors and officers. It was a pile of work, but not a
second was lost, and by 11.20 that night we were ready for the third
act, which was to be performed simultaneously by different sets of
actors in Boston and Wilmington. For this our officers were split. With
the directors of the Boston corporations, Chandler, and Mr. Rogers'
attorney to supervise the legal end of next day's transaction, I left on
a special car attached to the midnight train for Boston; while Addicks
and the Bay State directors set forth on another midnight train for
Wilmington, Del., to be followed in the early morning by my New York
partner, John Moore's partner, Braman, Foster, and more counsel
representing Mr. Rogers. This contingent was to carry the money.

CHAPTER XXVI

THE CIRCLING OF THE VULTURES

I don't believe there ever was before or since a financial operation in
which so many things, each of vital importance, had to be done at one
and the same time.

Before I took the train for Boston, just after the last deed had been
signed, Braman, Foster, and I had come to a complete understanding in
regard to the manner in which the court proceedings the following
morning should be conducted. It was understood that no one should take
another's word for anything, and consequently that no money should pass
until specific performance of all the required conditions. Immediately
on the release of the receivership, Foster and Braman were to be paid
their "fee," and they asked that the $175,000 cash coming to them should
be arranged in separate piles of bills. The two packages containing
Foster's and part of Buchanan's, and Braman's $50,000 were to be in the
joint custody of John Moore's representative and my partner, who, with
Rogers' counsel and Addicks, had been assigned to represent Bay State in
the court.

What would happen after the transfer of these several amounts was
outside my jurisdiction. Addicks did not confide to me his own scheme of
revenge, but of Braman and Foster's purposes I had a clear idea. As
Braman had explained, the great winning of his adventure should be made
in the stock plunge he and Foster contemplated in Bay State Gas stock,
then selling at 3-1/2 to 4; but lest there be some slip-up in court,
"buy" orders to their brokers were contingent on the word "go!" from
Wilmington. To get this off at the right moment a clerk was taken along,
whose only part in the play was to telephone this word "go!" They
expected in this way to make at least half a million.[16]

Addicks' intentions, as I afterward learned, were less exalted but much
more direct. He had conceived a plan whereby without danger to himself
he could punish Braman and Foster for the wrong they had done Bay State,
and at the same time meet his election expenses at no cost to his own
pocket. In the course of his electioneering campaign in Delaware,
conducted as all the world knows how, Addicks had gathered to his cause
as tough and rascally a set of "heelers" as ever waylaid aged woman or
lame man on the highway. A lieutenant who had been despatched to
Delaware early Friday afternoon, when it had become evident that we
should get things settled up, gathered the sturdiest members of this
precious troop together and solemnly told them that a serious hitch had
occurred in Addicks' game and that it looked as though, owing to the
receivership, there would be no "stuff" to put in circulation this year.
The men responsible for this outrage were to be in Wilmington on the
following day and from the appearance of things would get the money
Addicks had destined for his followers. He understood they were to
receive it in cash, too--$175,000--cash that really belonged to Addicks,
who had intended it for his good friends in Delaware. The thugs,
properly indignant at the wrong that had been done "the Boss," dispersed
rapidly to discuss the information among themselves. That night a group
of leaders got together and figured out a little plan of campaign to
frustrate the robbery of their beloved master. Court proceedings to
release the receivership could not take long, and they calculated that
the train schedule would detain Braman and Foster at least two hours in
Wilmington after the adjournment. What more easy than the organizing of
a little scuffle on the station platform or on the street and in the
rush--well, many things happen in a rush. This simple procedure
commended itself to all concerned, and that night there was much
rejoicing among the Addicks camp-followers at the pleasant things that
should be pulled "off" at the flim-flamming bee next day.

All these things were in the air when court opened in Wilmington on
Saturday morning. A special telephone line had been run and
arrangements made for a clear wire right into the directors' office in
the head-quarters of the Gas Light Company in Boston. At the telephone
in Wilmington sat my partner ready to communicate to me the exact course
of the proceedings, so that I might simultaneously make the agreed
transfers of our companies to Rogers. I knew my partner's voice; he knew
mine. We, too, were taking no chances.

     * NEW YORK, February 21, 1905.

     _Dear Mr. Lawson_: In your article in _Everybody's Magazine_
     for January, among other misstatements upon which I shall
     not now comment--since you have committed yourself too far
     to make it likely that you will withdraw them--you accuse me
     of having speculated in Bay State Gas stock with Mr.
     Buchanan's money; and of having subsequently been sued by
     him. I hold Mr. Buchanan's receipt for the money collected
     for him, which I paid him the night that I returned from
     Delaware. He has never sued me. Please inform me whether you
     are willing and agree to strike out these statements from
     your article when published in book form, and also whether
     you will agree to withdraw the same in your magazine. I
     tried to call on you and discuss the case when in Boston,
     January 21st; and I also tried to meet you on the day after
     last Thanksgiving; but apparently you were unwilling to see
     me. I remain,

     Very truly yours,
         ROGER FOSTER.

     THOMAS W. LAWSON, ESQ.,
     Boston, Mass.

     FEBRUARY 23, 1905.

     _My Dear Mr. Foster_: I received your letter of the 21st
     inst., and in reply will say, if I have done you any wrong
     in my story, "Frenzied Finance," or otherwise, it has been
     unintentional, and I regret it, and I seek this, the first
     opportunity, to give my regrets the same wide circulation as
     my original statements.

     As I wrote you previous to the publication of the magazine
     containing the parts you refer to, I try to exercise the
     greatest care in allowing nothing to appear in my story but
     facts--facts I know to be facts, and in addition only such
     facts as are absolutely necessary to my work, which is the
     portrayal of those events of the past essential to a proper
     understanding by the people of the evils that have been done
     them, and how they have been done, that they may do what is
     necessary to undo them and to prevent their repetition in
     the future, and, in addition, such facts as it is fair for
     me to use. I repeat what I said to you then: I have
     absolutely no feeling in regard to you other than an intense
     desire to do you exact justice.

     I dealt with you in the entire Bay State receivership affair
     in connection with Mr. Braman and I thought that I had every
     reason to believe that his Bay State Gas purchases were for
     your joint account; but now that you assure me they were
     not, I hasten to have such assurances chase my original
     story with the hope that they may speedily overtake it.

     My information that you had been sued by Mr. Buchanan came
     to me in a way that left no doubt in my mind of its
     correctness--no doubt until I received your letter. Papers
     were sent to me some time ago by reputable attorneys in a
     suit of Buchanan against Braman and, I understood, yourself,
     along the lines outlined in my story, with the request that
     I allow my deposition to be taken, so that Buchanan could
     get at the facts in his attempt to recover the moneys
     claimed.

     Your assurances to the contrary in regard to this matter I
     also hasten to start on the road you point out, and I will
     see that both statements are expunged from my book.

     You are in error in thinking that I did not wish to see you
     when you were in Boston. I did not know in either case of
     your desires until it was too late to see you. I certainly
     would have had a "sit-down" with you if it had been
     possible.

     Again assuring you not only that it is a pleasure to set
     forth the facts you have called to my attention, but that I
     am your debtor inasmuch as you have given me an opportunity
     to perform that duty which I owe to every individual my
     story treats of--to state facts and only facts with which
     they have been connected--believe me,

     Yours truly,
         THOMAS W. LAWSON.

FOOTNOTES:

[16] See foot-note on pages 189 and 190.

CHAPTER XXVII

COURT CORRUPTION AND COIN

The closing scene of this most significant drama was enacted on Saturday
morning in the Wilmington Circuit Court-room. There was nothing in the
cold formality of the proceedings to indicate that here was the
_dénouement_ of a serio-comedy in which greed and ambition had clashed
in a battle for millions; nor in the amiable indifference of the men who
got within the enclosed space below the judge's desk to suggest the
murderous passions and fierce hatreds raging beneath the surface of the
prevailing calm.

The _dramatis personæ_ were gathered in little groups representing the
separate interests--Addicks and some of his lieutenants; my partner at
the telephone; John Moore's partner and Rogers' counsel with their heads
together; Braman and Foster nearer the judge, their eyes wandering
toward two dress-suit cases piled before John Moore's partner, which, it
was understood, contained the money. At a glance it was impossible to
tell the one containing Buchanan's share from the other laden with the
receivership loot, but each was tagged, and it was evident that
possibilities of a mix-up had been carefully guarded against. Behind
Braman was his clerk, and in the rear of the court-room sat as many of
Addicks' thugs as could squeeze into the narrow space reserved for
spectators. They, too, eyed the dress-suit cases avidly, for the
information had been passed around that these innocent receptacles
contained the "stuff," of which the "Boss" was about to be robbed.

Court came to order. Foster rose, announced that the claims of his
client had been satisfied, and made a formal motion to dismiss the
receivership. The Court formally consented, and as the clerk was
entering the dismissal in his minute-book my partner telephoned the
facts to me. I sent back the word that my directors were resigning--had
resigned--that Rogers' directors were being elected--had been
elected--that the Boston gas companies were now transferred to Rogers.
My partner whispered my words to John Moore's partner and Rogers'
counsel. At once the two dress-suit cases, each loaded with currency,
were slipped to Braman and Foster. At the same time the messenger who
was to telephone to their broker rose and quickly left the court-room. A
brief period was consumed in signing receipts, certificates, and other
legal papers, and then the performance was over. Addicks rose and went
out among his henchmen in the rear, who eagerly surrounded him. In the
bustle Braman and Foster, each with his own booty, fled.

Let us see what was happening at the Boston end of the wire while all
this dumb show was being enacted in the Wilmington court-house. My
directors and officials were lined up against the walls of the
directors' room in the Boston Gas Light Company's office like so many
members of young John D. Rockefeller's Sunday-school class, inasmuch as
they were prepared to listen, sing, or shout "Amen!" at any time they
received the nod of the class-leader. In an adjoining room Rogers'
counsel had a similar line-up, with the difference that my men were
about to shed the crowns which the others were waiting to receive, and
which would transform them from humble business men into royal gas
kings. Through the open wire I was in such close touch with the scene in
the Wilmington court-room that I was almost sure I heard the subdued
weeping of the blindfolded Lady of the Scales on the bills which
occupied such a prominent part in the disreputable proceedings. Nothing
now could impede the course of events, so I concluded to take Time by
the headgear and secure what Bay State stock was in the market before
Braman and Foster got in their work. Over another wire which was at my
elbow I gave the word "go!" to my own brokers in Boston and New York,
and when a few minutes later they told me they were securing thousands
of shares, and that the stock was climbing toward 10, I could not
repress an inward chuckle at the thought that the money we had so
reluctantly parted with would spread over only one-half or one-third the
surface it was originally intended to cover.

It was all over in a few minutes, and when my partner said, "It's done,"
and "By Jove, there go Dwight Braman and Roger Foster on the dead run
with a dress-suit case apiece!" I held my sides as Parker Chandler in
his inimitable way bawled: "Tom, let's leave our straw hats on the pegs,
for we'll probably be back next spring figuring out how to pump air
enough through the gas-measuring meters to pay for that money we've just
loaned Braman and Foster for a day or two."

Braman and Foster, as I have observed before, knew their business. The
danger to which $175,000 in currency would be exposed, in a territory
controlled by Addicks, had appealed to their cautious instincts, and
once outside the court-room they literally took to their heels and ran
for a corner of the railway yard, where awaiting them was a special car
and engine. They jumped aboard, yelling to the engineer: "Let her go."
In the meantime eager-eyed ruffians searched the streets and hung round
the hotels, looking for two men with dress-suit cases. A hundred of them
were on the station platform, awaiting the departure of the regular
train. Ten minutes before leaving-time one of the henchmen appeared
among the gang, and passed round the word that the gents and the "stuff"
had got off by a special, and it was no use waiting any longer. Later
that afternoon, Addicks, to use his own words, in one of his rendezvous,
"dealt out his own good money in place of that he had hoped would take
care of the people's rights."

It was a fierce session of the Stock Exchange that Saturday morning.
Shortly before closing time a new set of brokers were frantically
grabbing for Bay State stock round 10, and Monday morning, when all the
world knew that the receivership had been lifted and our company was
itself again, the same crowd continued to buy fiercely. To these eager
purchasers I resold all that I had previously gathered, and enough
short besides, to compensate me for some of the losses I had previously
suffered, for this latter I was enabled to repurchase at half price,
when news came that another suit had begun against Bay State. This
latter drop in price so shattered the nerves of Braman and Foster that
they retired, having made up their minds that they did not know quite as
much about one end of "frenzied finance" as they did about the other. As
a matter of fact, nothing came of the suit in question, for it was
evident when the transfer of the Boston gas companies to Rogers' control
became known, that Bay State Gas receiverships had played their last
successful engagement.

My readers will not object if I again call their attention to the
inevitable workings of the law of compensation. The losses occasioned by
the market action of Bay State stock in these four days so mixed up
Braman and Foster in their financial accounts that later they were sued
by their client, Buchanan, who in court stated that he in turn was so
confused as to what was done in connection with this business that he
really knew less after it was over than before the suits were brought.
But one thing was indelibly impressed upon his mind--that his bonds had
disappeared in the whirl and he had not received anything for them. I
think this suit is still pending.

CHAPTER XXVIII

PEACE AT LAST

When the curtain fell on the closing scene of the performance in the
Delaware court there ensued a brief interval of quiet in the affairs of
Bay State Gas. Rejoicing in the temporary diversion of public attention,
the chief actors proceeded to assume their former rôles, and soon
affairs began to move at their old gait. Rogers took possession of all
the Boston gas companies and patiently awaited the coming down the pike
of some traveller with more money than brains. Having successfully
corrupted the State of Delaware, Addicks was being measured for the
senatorial toga, when accidentally the blind lady dropped her scales on
his unprotected head, which catastrophe laid him out long enough to
enable another to sneak the prize he had so long striven for. We are not
at present concerned with the affairs of Delaware, and it suffices to
say in passing, that after a heated contest one Richard Kenney was
chosen to the senatorial seat Addicks had so long coveted, and that this
man, a typical Delaware vote-rancher, after being sworn in as United
States Senator, was brought back to Wilmington and tried for robbing a
Delaware bank, his accomplices being some other heelers of Addicks. The
disclosures made in the trial showed that the case in all
characteristics conformed to the Addicks standard of indecency, for the
bank officials, not satisfied with "blowing in" every dollar of deposits
and capital the institution owned or controlled, had actually "lifted"
in addition the building in which the bank was situated. One of the
court functionaries who had heard the evidence tersely remarked: "Talk
about stealing a red-hot stove: this is a case where they took the
funnel with it to keep the draught going until they set it up in a new
location!"

But Delaware, as my readers have doubtless gathered long ere this, is
its own kind of a country, and rewards and punishments are so perversely
adjusted that it seems a sort of Topsyturvydom. In this instance certain
of Addicks' heelers went to State's prison and death; Kenney returned to
the Senate to help make laws for the great free people of America, while
the chief conspirator, with a threat to sue the blindfolded lady for
damage done, began to set out the pieces on the Bay State Gas chessboard
with a view to trying certain new moves that had occurred to his
perpetual-motion mind.

The situation of Bay State Gas stock was fully understood by the public.
While Rogers had possession of the Boston companies, he simply held them
in trust, and must give them up whenever the parent corporation had coin
enough to redeem them. The securities were still in the hands of the
public and my friends, and my own duty to get Bay State Gas on its feet
was plain. It was again a case of raising money, and to do this we had
the issue of securities which we were preparing to float just before
Foster and Braman swooped down on us. Addicks agreed that if I would
undertake the marketing of this stock, he would issue only enough of it
to redeem the properties from Rogers. His directors met and formally
"resoluted" on this point, and I felt satisfied before going ahead that
there was no danger of this money being put in jeopardy without actually
stealing it. The company, for the nonce, had no other business but to
pay office rent and clerk hire, and in spite of Addicks' financial
immorality, all who knew him were aware he took no chances of ever
getting himself sent to jail. So I began to sell the stock in the open
market.

_PART II_

CHAPTER I

THE MAGIC WORLD OF FINANCE

Though this is the twentieth century and enlightenment is supposed to
prevail throughout this broad land of ours, the majority of people still
regard the world of finance as the world of magic. Within the fairy
realm of finance the laws of nature apparently are suspended, and,
overnight, wonders are worked. The ordinary mortal, wise in all other
walks of life, sees the man who yesterday stood beside him at the plough
or at the bench emerging from the mysterious portals bearing the fruits
of the endeavors of a hundred or a thousand lives, although a moment ago
he passed through them with nothing. Who can deny the magic that thus
demonstrates its power, or fail to accord veneration to the magicians
that work such marvels? No wonder the ordinary mortal feels that he has
no license to enter the world of finance save on his knees, hat in hand,
bearing tribute to the divinities enthroned within this enchanted
territory.

It is my purpose to do away with this extraordinary deception and to
show it up as one of the artifices with which tricksters, since the
beginning of the world, have imposed upon the people. There should be
nothing in finance that any man or woman of ordinary intelligence and
experience cannot understand, and I purpose to explain here the
machinery of the "System" so that every one will exactly understand it
from headlight to rear-end lantern. Many intelligent people have no
clear idea of what a certificate of stock or a bond really is, and the
words "money," "stock-exchange," and "finance" are mere terms which they
glibly use without knowledge of their meaning.

It is not difficult to understand the grocery or the dry-goods business.
Standard articles of well-known form are sold by weight or measure over
the counters for fair prices. The patrons of such businesses insist on
knowing what they are buying--what they are to get in exchange for the
money which is the fruit of their labor, and then, after they have been
told, and they trade, they require that the goods be as described or
they will know why not. The average American would consider it a huge
joke should his grocer undertake to induce him to buy one hundred times
more sugar than he could use, on the ground that he might find in the
sugar bags when he reached home gold and diamonds. But would he not
wrathfully seek the police if, after opening his sugar bag, for which he
had paid $1, he found it contained only 50 cents' worth of sugar? He
would tell you if you met him at this stage: "You can bet that chap on
the corner cannot get away with any such trick as that--not in America.
He might in Zanzibar or in the kingdom of the Sultan of Sulu, but I will
show him he cannot rob Americans in these enlightened times." The grocer
would be hustled to jail without a "by your leave," and thenceforward
his name would be a by-word among all honest tradesmen.

And so it goes in every business but finance--finance, the most
important of all, the business into which is merged all other
businesses, the business of taking and preserving the results of all
other businesses, of all other human endeavor. Over our land to-day are
big, able Americans, long-headed and experienced, adept at a jack-knife
swap or a horse trade--industrious farmers, hard-handed miners, shrewd
manufacturers, each in his own line a good business man, yet these
sturdy traders, whom the "gold-brick" artist or the "green-goods"
practitioner would never dream of tackling, come weekly into Wall
Street, or into such branch shops as exist in every community on the
continent, and are done out of their savings like the veriest
"come-ons." Humbly they take, in return for the gold earned with the
sweat of their brows, a piece of paper of a given value which they
return later and exchange for half the amount the paper cost them
originally. In the space between purchase and sale fifty per cent. of
their investment has disappeared--has been filched away, but yet they
have no resentment. They evince none of the feelings of the man whose
pocket has been picked or whose till has been robbed. On the contrary,
their sentiment is of admiration for the banker, the broker, the
financier through whose agency their money has been lost.

Take, for instance, the prosperous tanner who goes to his banker with
$100,000, the fruit of ten years' success, and exchanges this sum for
1,000 shares of Steel Preferred. Now, if he were to examine this
security with half the thought or investigation he gives to a $500
car-load of bark, he would learn that there was not 20 cents on the
dollar of real value behind it. In six months the eminent tanner is
again at the banker's offering for sale his thousand shares of steel. In
the meantime it has declined in value and he has to part with it for
$50,000. But he does not complain; indeed, he bows his way out of the
palatial office of the great man and is full of sincere thanks when the
banker promises to let him know the next good thing on the market.
Suppose our tanner had purchased ten cars of tan bark and found that
each car-load was short ten per cent. Would he not at once go to his
attorney and exclaim emphatically that he would spend thousands rather
than let the scoundrel who had tricked him get away with his swag?

Suppose our grocer waxing rich invests his funds in the Sugar trust. He
thinks he knows all there is to be known about sugar. The business of
the trust is to make the sweet commodity and sell it to the people. No
mystery or magic, surely, about this simple pursuit. Yet when our grocer
invests his savings, the sugar stock is many dollars more valuable than
when, scared into selling by fluctuations which he cannot see any reason
for, he tries to get back his investment. So many times have investors
been milked of their savings by this one trust during the past twenty
years that in the coffers of its creators and jugglers are hundreds of
millions of money that once belonged to the people for which they have
received absolutely nothing in return.

Both the tanner and the grocer must know, when they look up and down
Wall Street at the great office buildings which tower into the sky on
either side of the street, that these are huge hives of expensive bees
who, from New Year's to New Year's, do not produce a dollar. They should
realize that the hundreds of millions spent each year for the expense of
running the "System's" game, and the millions which the game-makers
flaunt in their faces, must have been derived from such as they--the men
who produce.

It is the phenomenon of the age that millions of people throughout this
great country of ours come of their own free will to the shearing pens
of the "System" each year, voluntarily chloroform themselves, so that
the "System" may go through their pockets, and then depart peacefully
home to dig and delve for more money that they may have the debasing
operation repeated on them twelve months later.

You may ask if I desire to convey the idea that the great financial
institutions and trusts of this country, which have their head centre in
Wall Street, are all concerned in a conspiracy to rob the people of
their savings. You think, doubtless, that so sweeping a statement goes
beyond the truth. I desire to go on record right here in declaring that
all financial institutions which in any way are engaged in taking from
the people the money that is their surplus earnings or their capital,
for the ostensible purpose of safeguarding it, or putting it in use for
them, or exchanging it for stocks, bonds, policies, or other paper
evidences of worth, are a part of the machinery for the plundering of
the people.

This is a terrible charge, I am well aware, but it is based upon a
thorough knowledge of the subject and made with a full appreciation of
its gravity. I do not mean to say that all the men who handle and
control the different institutions I mentioned have guilty knowledge of
the bearing of their actions. Many of them are of the purest minds and
most honest intentions, and are quite incapable of participating
voluntarily in a conspiracy to wrong any one. They do not know, however,
that the relation between their own minor institution and the general
financial structure constitutes the former an agency for the "System,"
which controls and has organized the general financial structure into an
instrument for converting the money of the public to its own purposes.
In fact, the "System" has cunningly possessed itself of the financial
mechanism of the country and is running it, not for the object for which
the machine was devised, but for the benefit and personal profit of its
votaries, and so the vast correlated organization of banks, trust
companies, and insurance corporations which were brought into being for
the safe handling of the people's savings has become an agency for
transferring these savings to the control of unscrupulous manipulators,
who take liberal toll of every dollar that passes through their hands.

The duty of the American people is to unloosen the thraldom of the
"System" on our financial mechanism; to pluck out of their high places
the dishonest usurpers who have degraded the purposes of our financial
institutions, and to restore those institutions to their legitimate
functions. When the people are fully awakened to the condition I
describe, surely they will arise in their wrath and sweep the
money-changers from the temple.

CHAPTER II

THE "SYSTEM" AND THE LOUISIANA LOTTERY COMPARED

Years ago one of the greatest evils in this country was the Louisiana
Lottery. Through that lottery millions and millions annually were taken
from the people and transferred to a few unprincipled schemers, who soon
found themselves in possession of enormous fortunes. Wise men called for
the abatement of this awful drain on the savings of the nation, but the
law-abiding, God-fearing people of the country met their plaints with
"Why should we be bothered about this matter? If fools and knaves elect
to gamble in such palpably fraudulent ways, let them gamble, and their
losses are no affair of ours. It is none of our business." But presently
these honest people had it pounded into their well-meaning heads that
the principal instrument by which the swindle was conducted was their
own mail service, one of the most important branches of their
Government; that, in fact, in each and every city, town, village, and
cross-road in all our virtuous land, Government officials were acting as
distributing agents for this huge corrupter and robber.

Then the people rose in their irresistible might, and between the rising
of one day's sun and its setting this powerful machine went as goes the
gum-drop on the red-hot stove cover at a pop-corn soirée. It melted,
leaving nothing but a faint odor and a thin stain, both of which
disappeared in the next morning's scrubbing, and the Louisiana Lottery
was as though it had never been. Yet during its reign its insolent
votaries could prove to the absolute satisfaction of all intelligent,
patriotic men that it was useless for any man or set of men to attempt
the lottery's destruction, because they would be met with the
accumulated resistance of the reckless spending of the vast amounts of
festered dollars which had been stolen from the people. The argument of
these comparatively petty thieves was: "No men nor sets of men can hope
to 'stack up' against us, for their money comes hard, cents and dollars
at a time; they are obliged to earn it, while we get ours in chunks by
simply taking it. We can buy lawyers and can hire law-makers, and we can
lease Government officials, and we can outbid any honest men, who are
the only ones who object to our game. In the market for legislative or
business talent you cannot get within touching distance of us." Yet the
people had but to sneeze and this foul parasite was detached from their
free and honest structure and was wafted away with the dead leaves and
the dust to bottomless nowhere.

In the height of its prosperity the Louisiana Lottery took from the
people only a paltry ten or twenty million dollars a year, while to-day
there are single groups of banks, trust companies, corporations, and
trusts which take from the people by might, by trick, and by theft
hundreds of millions each year; and there are scores of such groups. The
Sugar trust has been the instrument of gathering, in one year, a hundred
millions of the people's savings, and the Steel trust alone has robbed
the people of over five hundred millions of dollars in a single twelve
months.

To-day the "System" and its methods are as clearly and as sharply
defined in the tangibility of their relation to the people as was ever
the Louisiana Lottery. On certain days the Louisiana Lottery sold its
tickets, which the people bought with their savings. On a certain day
the drawing took place, at which all those who had parted with their
dollars expected to receive them back together with immense profits, and
upon that day disappointment was spread broadcast among the many and
unhealthy joy among the few. So with the "System." On certain days the
public is sold their stock, bond, and insurance policy certificates.
Upon other days they look for their savings and profits. On the
contrary, they learn that their savings have decreased in value or have
been wiped out, and that there never was any chance of profit. My
critics will say that such a comparison cannot hold, for in the lottery
nothing was dealt in but gambling tickets, whereas the stock or bond
certificate represents an ownership in the material things of the
country. This is the fallacy the "System" spends millions every year to
foster and disseminate. Between the two the difference is in favor of
the Louisiana Lottery, for both are gambles and the lottery game was
square. Those who ran it had for their trouble a fixed percentage of the
profits, an enormous percentage, it is true, but the general fund was
never encroached upon by the controllers. Who is to say what percentage
the votaries of the "System" take in their game? It depends on how much
their victims have to lose. The public have been persuaded, too, that in
purchasing stocks they do not gamble, but only invest, or, at the worst,
speculate, so they are deceived as well as plundered. A few millions
each year satisfied the lottery owners; the votaries of the "System,"
among whom the "swag" must be divided, demand millions upon millions
each. The tickets of the lottery had a definite value at all times until
the drawing took place. The stocks and bonds of the "System" have no
rigid or unalterable value when issued or at any other time, and do not
represent a fixed ownership in all the savings of the people which have
been paid for them.

Morally, legally, or ethically, the Louisiana Lottery, with all its
attendant curses, was a far better institution for the people to bump up
against every month than is the "System" against which the whole people
are now directly or indirectly dealing every working day of the year.
Startling this statement may be, but not more startling than the facts.
The records of the lottery company will show how many dollars it took in
from the public; how many were returned in prizes and expenses; and how
many went into the pockets of the owners. The records of the banks,
corporations, trusts, and stock-exchanges will exhibit how many dollars
were paid into the "System" by the people; how much they received back
in return therefor; how much the expense of conducting the business was;
and how much profit went to the votaries of the "System." Compare the
two and it will be found that there is annually taken by the "System"
from the people a hundred, yes, a thousand times more than the Louisiana
Lottery ever obtained in the same period.

This being the fact, for how long will the people allow such a monstrous
wrong to be done? How long will they suffer a few men to siphon
automatically the money of the many into their own pockets?

It is only a matter of simple mathematics to ascertain the day, and that
only a few years away, when ten men will be as absolutely and completely
the legal owners of the entire United States and all there is of value
in it, as John D. Rockefeller is the absolute legal owner of the large
section of it of which he is to-day possessed.

_When that day is here, the people will legally be the slaves of these
ten men._

If this is so--and it is as surely so as it is that the Constitution of
the United States of America guarantees to every man, woman, and child
who is a part of it perpetual freedom--it is so because the legal
interest alone to which the ten men will be entitled and which they must
receive (or our entire structure will fall) will of itself bring to
their coffers all the wealth in existence within a given time. If this
is so, then why have the American people allowed themselves to reach
this condition? Why are they to-day not only resting peacefully under
this worse than death-bringing yoke, but assisting in the further
riveting of this badge of dishonor and degradation?

The reason is simple: They have been lulled to sleep by the "System" and
its cunning votaries until they have but a dull appreciation not only of
existing conditions but of their coming consequences. It is almost
incredible that a people as intelligent as the American people, and as
alert to that individual and national honor which they have bought with
so much of their blood and their peace of body and mind, can be so
deceived and juggled with. When one looks about, however, and notes
happenings of which one personally knows, and the degradation and
dishonor to which public opinion is seemingly indifferent, nothing is
incredible.

One sees a certain man openly displaying five hundred millions of
dollars, a sum which represents the life earnings of 150,000 of our
population, and knows that this man has secured this incredible amount
during forty years of his life. One sees the second highest and most
honorable office in the nation, a United States Senatorship, openly
bought for a few stolen dollars by a man who up to the very day of its
purchase was a watch repairer in a small country town, and who had never
done a single meritorious deed or been possessed of worldly goods to the
extent of $5,000. One sees a wily adventuress secure from the banks,
which exist only to safeguard the people's deposited savings, hundreds
of thousands of dollars on her bare story that she was the possessor of
some mysterious documents. One sees a $6-a-week office-boy of one of the
"System's" votaries able to borrow for the "System," on his bare note,
four millions of dollars from a New York institution which only exists
to safeguard the people's savings--although the law says that such
institutions shall not loan to any man on any kind of collateral, even
Government bonds, one-tenth that sum. One sees two men, drunk with their
success, gouging and tearing at each other's hearts in Wall Street, and
sees their gouging and tearing bring about a panic which takes from the
people in an hour over a billion dollars and drives scores to suicide,
murder, and defalcation--the two men continuing meanwhile as ornamental
pillars of society instead of wearing prison stripes. One sees a great
railroad corporation, in which are millions of the trust funds of
widows, orphans, and charitable institutions, caught "short" (having
sold something it did not own) in the stock-gambling game and held up to
the tune of ten million dollars by a reckless stock gambler, who says
"If you don't settle to-night it will be twenty millions to-morrow"; and
the toll is paid, while the great banker who conducts the release of the
hold-up charges the further tribute of twelve million dollars for his
services. And then one sees this twenty-two millions of "commission"
tacked on to the capital stock of the great railroad which is
subsequently capitalized into a "bond" and sold to great life-insurance
companies as a first-class investment for their trust funds.

When one sees these things and a hundred other as rankly fraudulent, one
should not wonder at anything American connected with dollars.

Such things occur because the "System" has so far been able to keep the
public in ignorance of its doings. On the surface there is nothing to
suggest that a set of vampires have captured the high places of finance
and are sucking away the life-blood of the nation. Our banks and trust
companies all present a fair exterior and apparently are the same safe
and honorable institutions they were before the canker fastened on them.
Only its votaries know what the "System" is, and their way is the way of
silence and darkness. A tie, stronger and more effective than the oath
of the Mafia, binds them to its service, and woe be to him who dares
divulge its methods. He who is bold enough to enter upon a recital of
these secrets must be strong indeed to withstand the bribes to silence
which would be placed in his hands. The "System" can well afford to pay
any price rather than be brought face to face with its past, with an
enraged people for referee. And even if the being be found who will
venture an exposé of the conspiracy, he will find it strangely difficult
to get his story past the traps and pitfalls which will be placed
between it and the people for whose enlightenment it is intended.

THE FUNDAMENTALS OF FINANCE

Finance is easy enough to comprehend if it be explained, but so long as
an explanation is deadly to the interests of the men who control it, one
can be sure none will be offered. There is no term more common to-day
than "trusts," and we are surrounded by "trusts," institutions whose
workings during the past twenty years have awakened intense public
curiosity to know what a "trust" is. Yet there is not extant a
definition of a "trust" which conveys to the rank and file of the people
any real idea of what a "trust" is. So vague is the general
understanding of the "trust's" functions and purposes that the most
intelligent and honest statesmen struggle and hopelessly flounder when
they attempt to define them, and we have at the present time the able
chief of our nation talking of regulating them by law, when, as a matter
of fact, a "trust" is, top, sides, bottom, outsides, and insides, an
absolutely illegal institution, created outside the law, existing
outside the law, and having for its purpose the performance of those
things and only those things which the law says cannot be performed
legally. Imagine our law-makers gravely meeting to make laws for the
control and regulation of the pick-pocket or burglar or counterfeiting
industry, or endeavoring to prescribe legally the times, places, and
amounts of national bank defalcations, or the kind of ink, paper, and
pens which must be used by forgers in the pursuit of their
profession--imagine it!

In entering upon an explanation of the workings of the "System," it is
necessary to set forth plainly the fundamentals of finance, the few
rules and inventions by and through which humanity regulates its
affairs. In the beginning, of course, might was right and men supplied
their wants by force, trickery, or cunning. In time the disadvantages
of this became obvious, for while the stronger could overcome the weaker
and satisfy desire, a combination of the weaker units acting together
could always wrest the prize from the individual. To equalize things,
the people got together and made for themselves rules and regulations
governing the conduct of their lives and their relations with one
another. This was invention No. 1: _Law_. Presently it developed that
the physical barter of the commodities of labor was not a satisfactory
basis of exchange; so to the statutes already in existence a new one was
added providing an interchangeable token of value. This was invention
No. 2: _Money_. The statute insisted that the money be of a fair and
just standard, by which all the people should receive the equivalent of
their labor, and no more. As conditions became more settled, there grew
up a realization of the value of a man's life to those dependent on him,
and of the fact that when he died his wife and his children were
deprived of the livelihood his labor won for them. A new regulation was
added to the code, providing that men contributing to a fund during
their lifetime should be entitled at death to leave to their heirs a sum
in proportion to the amount of their contribution to the fund, less the
actual expense of caring therefor. This was _Life Insurance_--invention
No. 3. But there were other calamities less distant than death to be
guarded against, and a common fund, also based on the contributions of
individuals, to aid and relieve in case of fire and kindred calamities,
was organized. Hence invention No. 4: _Fire Insurance_.

And thus the fabric of civilization grew, each addition to the structure
being made to cover a want which experience developed. As time went on,
some of the people accumulated the fruits of labor, money, in greater
quantity than was requisite for their own needs, but which less thrifty
or less fortunate brethren could so profitably employ in their own
affairs as to be able to pay for its use a fair proportion of what it
could be made to earn. Thereupon provision was made for a common place
of safety for this surplus money, a place where experts in the handling
and putting to use of money could employ their talents, first,
safeguarding it and, then, loaning it to others. And the law was made to
say that all money put into this common place should be so guarded as to
be ready for its owner when he demanded it; that its owner should
receive all it earned less the necessary expense of holding it, and that
the amount it earned should be only such as those who borrowed it could
fairly make it earn. This was invention No. 5: _The Bank_.

As the years followed one another, "the bank" became one of the most
important of the people's institutions and grew in number and variety.
There came to be many different forms of banks. For instance, _national
banks_, which, under the control and regulation of the Government,
became depositories for the circulation of the Government's money and
were privileged to lend money to individuals or corporations with or
without collateral. Funds confided by the people to these national banks
had always to be ready for their owners. A second form was the
_savings-bank_, which grew out of the requirements of small depositors
and was governed by the laws of its community. The savings-bank used and
safeguarded money confided to it in small sums, and these amounts could
be withdrawn only by their owners in person, after an agreed term of
notice. The savings-bank was allowed to lend only on real estate or
certain other securities, the character of which was rigidly regulated
by the law. In consequence, it could use its funds for long-time loans
and mortgages, so it earned larger rates of interest than the national
banks. The _trust company_ was a third variation, coming somewhere
between the national and the savings-bank, and was regulated, as was the
latter, by the laws of the community in which it existed. The trust
company, too, received deposits from the people, but was allowed a
broader latitude in employing them. It was also authorized to engage in
certain other business--for example, to act as manager for a deceased
person's estate and even to buy and sell securities. Because of the
extra-hazardous business in which it engaged and from which the other
two institutions were legally debarred, the trust company earned and
paid larger rates of interest to its depositors, and the men who
handled its funds were allowed to take for their own remuneration
profits in excess of those derived by the custodians of national and
savings-banks.

Another deficiency in the business structure growing out of the
increasing prosperity of the people was next provided for. When an
enterprise became so large as to necessitate several owners for its
conduct, the prescribing and defining of the relation of these owners to
each other and to the common property became a task of increasing
difficulty. So the idea arose of welding the enterprise itself into a
separate entity which could do all the things the individual might, and
yet exist apart from the individual and independent of his personal
dealings and comings and goings. His ownership should be an undivided
interest in the whole represented by certificates of stock or bonds,
which could pass from him to another without interfering with the
enterprise. This was invention No. 6: _The Corporation_. The law then
provided regulations for the creation and conduct of these corporations
which compelled them to keep their affairs in such shape that all could
ascertain of what each consisted.

When these six organizations had been founded, the machinery for the
conduct of the business of a civilized people was almost complete. But
still one other want developed: with the multiplication of the
corporation tokens of property, it became necessary that there should be
some place where the worth of these might be ascertained either by
purchase, sale, or loan under the regulation of experts. So there was
created a common market-place, to which came all those who had
corporation tokens of property to sell and those who desired to purchase
them; and the prices these brought were announced to the world and
became the measure of the value of the institution they represented.
Rules for the regulation of the business of the market-place were
gradually formulated, and invention No. 7--the _Stock Exchange_--came
into existence.

With this addition, the people's organism for safeguarding and
economically handling the funds of their labor to the best advantage of
all concerned and without interfering with the rights and privileges of
individuals was fully equipped. Each separate institution had grown out
of an actual necessity and had its own legal organic function, fully
understood and defined. And there was no branch of human industry which
could not be safeguarded, handled, and perpetuated through this
organism, nor could evil come from the existence of any one of these
seven components. The robber, the thief, and the pirate, as defences
against whom they had been erected, could not seize any of them or the
people's savings which they were created to safeguard, because the
constitution of each provided adequate penalties for such a seizure. As
long as the members of the organism performed their ordained functions
the fabric of the people's fortunes was safe from plunder.

CHAPTER IV

THE MAGIC "JIMMY"

It was at this stage that the class which is now the "System"--of which
the mighty robber of barbaric days was the prototype--began to cast
envious eyes at the accumulated earnings of a prosperous people locked
up and safeguarded against depredation, while the owners (the public)
rested easy in the conviction that they had fully protected themselves
against the spoilsman. The "System" reasoned: "If only a way could be
devised to win control of the seven institutions so that all the
benefits the people intend for themselves may revert to me and yet I be
exempt from the punishment provided for those who attempt unfairly and
dishonestly to secure such benefits, I can get a much easier and surer
possession of the results of the labor of the people than I was wont to
when I took them by might."

A need defined is half relieved. Outside the treasure-house was the
robber enviously surveying its strong walls and iron doors, its locks
and bolts, specially designed to defy the felonious intentions of such
as he. How safely to win his way in and possess himself of the piled-up
gold was his problem. And as he waited and watched, the lawyer, at his
solicitation, invented for him a magic "jimmy"--an instrument with which
he could not only break through the outside door, but as easily force
his way past the complex locks of the chambers inside. What was still
better, this magic "jimmy" was also a license to enter upon and take
possession of others' properties and use them for his own benefit. It
conferred on its owner a legal privilege to steal. The robber was
satisfied. The "jimmy" which the lawyer had brought him was the
"trust."

All this sounds very hyperbolical and far-fetched, perhaps, but it is
exactly what a "trust" is. The "trust" may also be defined as a master
key to the people's financial structure, which enables its owner to
enter any or all of the separate institutions I have mentioned, and
combine any or all of them, without affecting their respective
organisms, into a new organization which possesses the potencies and the
privileges of each, but is unhampered by the legal restrictions of any
one of them. Like electricity, the exact nature of a "trust" does not
admit of rigid definition, but it is a force which can be exerted only
in conjunction with financial organisms, which it joins and yet
releases, adds power to, and exempts from consequences. Let us suppose
that two men are made into a "trust"--this human combine becomes at once
free from the bondage of matter and the senses, sees out of the back of
its head and passes in and out through solid walls. It has all the
combined strength and more that the two men had and all their human
privileges and possessions, but it evades nature's laws as to
individuals, and the laws of man both as to individuals and other
material things.

To put the description in still another way, a "trust" is an institution
which endows itself with the right to use any or all of the seven
institutions of the people as the people use them, but so made that its
user derives from the institutions the benefits the people intended for
themselves, and yet is immune from the legal consequences of
appropriating such benefits. Two or more men make a "trust" by
combining--acquiring the control of--an insurance company, a trust
company, and a savings-bank. The new organization _is_ all of these
institutions, performs the functions of all of them, yet can legally do
with their incomes, capital, and surpluses things which, from the very
nature of each, none of the institutions is allowed to do--the new
organization is all of these institutions until the law attempts to
bring it to book; then it evades being any one of them. The trust
company is empowered to lend money on speculative ventures which the
insurance company and savings-bank may not do, so the "trust" lends the
insurance company's vast accumulations and the savings-bank's hoard
through the trust company with great profit or tremendous loss and
enjoys immunity from the consequences which should follow such
disobedience of the law. Moreover, when the trust company shows a profit
the "trust" appropriates it, and when a tremendous loss is sustained the
insurance company or the savings-bank must bear it.

An illustration: A, B, and C form a "trust." A and B are president and
controller of a savings-bank and an insurance company respectively. They
organize a trust company with $1,000,000 capital, of which the insurance
company furnishes the majority; they then elect C president and
controller of the trust company, and make him their associate or a
dummy. The trust company receives $5,000,000 of the people's money on
deposit. The insurance company deposits $5,000,000 of its surplus funds,
and the savings-bank $5,000,000 more. The trust company now has
$15,000,000 of the people's savings in its control with which by law it
is allowed to do certain things; but what it does with the $5,000,000 of
the savings-bank and the $5,000,000 of the insurance company the law
specifically says neither one of the institutions can do itself. The
"trust" then purchases for $5,000,000 the stock of an industrial
corporation. It borrows the $5,000,000 and an additional $5,000,000,
which represents its own first profit, from the trust company through
irresponsible dummies, depositing the industrial stock as collateral.
The "trust" next causes the trust company to issue bonds for
$15,000,000. These bonds are based upon and secured by nothing of worth
but the stock. The trust company offers these bonds for sale. The
insurance company buys $7,500,000 of the bonds, and the trust company,
through dummies, the other $7,500,000. By the operation so far the
"trust" shows a profit of $10,000,000. After making this profit and the
true worth of the bonds becoming known, these decline back to the
original worth of the stock upon which they are based, $5,000,000, and
there is the tremendous loss of $10,000,000 made. The trust company
"busts," and there is a loss to its depositors of $10,000,000. This loss
is divided as follows: $3,333,000 to the savings-bank, $3,333,000 to the
insurance company, and $3,333,000 directly to the people, less the
small amount which will be recovered from the stockholders. (These
losses will be affected in an unimportant way by the $1,000,000 original
capital.)

In this case the "trust" has done nothing for which those responsible
for it can be held civilly or criminally liable. Neither has the
insurance company, the savings-bank, nor the trust company, and yet, if
there had been no "Trust" and any one of the three institutions had made
the loss directly through its own actions, the officers of that
institution would have been civilly and perhaps criminally held
responsible.

The utility and convenience of the "trust" having been demonstrated, it
became a popular instrument for financiers desiring to accomplish all
manner of illegal purposes. Especially was it an apt tool for the
"System," which in the meantime was perfecting its control of the
people's institutions. The owners of railroads running through the same
territory, finding cumbersome and hampering the restrictions with which
the community they served had safeguarded its interests, formed
"trusts." Straightway there were valuable results--the combination was
emancipated from the regulations which had bound its individual members;
competition was eliminated and rates were raised.

As time went on new "trust" possibilities were discovered and other
institutions linked up--corporations of all kinds, insurance companies
and national banks and savings-banks, were brought together for the
benefit of the "System" and the detriment of the public. The end of the
trustification of the institutions of the nation is not yet, but the
people are to be shown a way by which the plundering process can be
reversed and through which they can make their freedom complete and
absolute by the complete and absolute enslavement of the "System"
itself.

CHAPTER V

HOW THE "SYSTEM" DOES BUSINESS

To follow the various steps in the crimes of Amalgamated, my readers
should know how the securities of a corporation are manufactured, how
"put upon the market," how admitted to the Stock Exchange, how prices
are made in the Stock Exchange, how fictitious and fraudulent quotations
are created and disseminated, until the very shrewdest members of the
Stock Exchange cannot distinguish those which are real from the
fictitious in cases outside their own manufacturing. Then there is an
elaborate and ingenious procedure by which public opinion is moulded,
that is, by which people are made to believe that the prices at which
they buy and sell the stocks and securities are bona fide; and this is a
procedure as compact and as well understood by the "System's" votaries
as are the methods of the bank-breaker or burglar--who sends his "pals"
ahead to "pipe" the lay of the land--by felony's votaries. When I have
shown these things, about which little is known to-day by the public, my
readers will have no difficulty in comprehending what I shall lay before
them of the actual robberies in the case of Amalgamated and other
notorious enterprises.

The underlying principle of the several organisms through which the
commerce of the country is conducted is the protection at once of the
interests of the individuals composing them and of the public with which
they do business. Provided this principle is adhered to, no harm can be
wrought to either. Most of the contemporaneous swindles through which
the people have been plundered were perpetrated through the agency of
corporations, and this organism has become a sort of synonym for corrupt
practice. Yet the original corporation invention as I have described it
was devised to meet a real want of the people, and it has merely been
diverted from its proper use by the lawless votaries of the "System."
Consider the institution as we now understand it. Certain individuals
decide to conduct their business in railroads, mines, manufactories,
patents, etc., in the form of a corporation and apply to the
community--the State Government--asking authorization to do so. They are
compelled first to conform to the rules and regulations laid down by the
State for the control of corporations, which say in one form or other:

"We create you for the purpose of doing those things that are best for
the many, not the few, and if we knew you would use our authority to
oppress the many in the interest of the few we would not create you."
The fundamental privilege of incorporation is the legal authorization to
issue paper titles of ownership to the business just incorporated. These
are in the form of stocks and bonds. Whoever owns these paper titles
shall possess the property and the business as the individuals did
before they incorporated, and the law presumes that they shall manage
and control that business, receive the benefits which come from it, and
suffer any loss arising from its conduct, and that all these benefits
and responsibilities shall be as laid down in the law. It follows that
no harm other than that the law expressly prescribes penalties to
prevent can come to any one from corporations thus created, always
provided the laws are what they appear and what the people intended them
to be, and that they are enforced as the people intended they should be.

It is most important to all concerned in a corporation that the paper
ownership shall represent the real value of the property on which it is
based, and no more. When the people exchange their savings for these
authorized paper tokens, they should be able to rest confident in the
State's guarantee that they are worth what they purport.

There have probably been jailed in the United States during the past
twenty years thousands and thousands of American citizens whose
aggregate stealings do not amount to one-tenth the total taken from the
people by either the Amalgamated, the United States Steel, the American
Tobacco Company, or a score of other fraudulently organized or
fraudulently conducted corporations.

There are various ways of organizing corporations and issuing their
stocks and bonds. Sometimes a company is organized to acquire a
property; individuals and institutions set down their names to take and
pay for the shares or bonds. With the money thus obtained the property
is purchased. _Or_ the individuals who own the property which is to be
the basis of the corporation exchange it for all or part of the stocks
and bonds. In the latter event those original owners usually sell to the
public the tokens thus acquired.

Honest men in forming a corporation make publicly known the character
and worth of the properties or enterprises they are organizing, what
they have cost, what their profits are, and what may reasonably be
expected by investors. The tricksters and the "System," with whom
incorporation is generally but the first step in a conspiracy for
plunder, surround the proceeding with an air of mystery and refuse
information usually with: "We do our business quietly and in silence,
and those who do not like our ways may keep out of this scheme." Their
whole procedure is of that high and mighty order which impresses the
ordinary mortal with a sense of confidence in the independence of its
users and a conviction that their scheme must be so good that they do
not care whether they sell or not. This is just the effect it is
intended to produce.

The next step is to lead the people toward the shambles. This is done by
"moulding public opinion," and for this interesting function the
"System" and Wall Street have an equipment of magical potency. Public
opinion is made through the daily press, through financial publications
of various kinds, and through "news bureaus." Every great daily has a
financial editor and a corps of experts in finance who spend their days
on "the Street" cultivating the friendship of the financiers. At night
they are round the clubs and hotels where the brokers and promoters
congregate, debating the events of the day and organizing those of the
morrow. There are also the strictly financial papers--daily, weekly,
and monthly--whose corps of editors and news gatherers live on "the
Street," and know and care for nothing but finance. And lastly, there
are the news bureaus, with runners out everywhere to gather in items of
news affecting stocks, Wall Street or finance. These are printed on
small square sheets of paper, and delivered by an army of boys at brief
intervals while the Stock Exchange is open at the offices of the
bankers, brokers, insurance companies, and hotels; or the same matter is
disseminated by means of an automatic printing machine called a
news-ticker. For this service the offices pay the bureaus from $1 to $2
a day. News bureaus form an important cog in the machinery for making
stock-markets, as it is through the news they furnish to the Stock
Exchange and to the offices where investors and speculators gather
together that the big operators affect the market. A decision to buy,
sell, or "stand pat" is often based on the _on dits_ of these printed
slips.

The first step toward "moulding public opinion" is taken when the
"System's" votaries send for the dishonest chief of a news bureau, a man
usually up in every trick of the trade. I will later describe one of
them, a scoundrel so able and experienced that, to use the vernacular of
the gutter of "the Street," he can give cards and spades to the
frenziedest of frenzied financiers. To this man the "System's" votary
will say something like this: "We are going to work off blank millions
of blank stock; it costs us thus and so, and we want to sell for so and
so many millions." Nothing is kept back from this head panderer and
procurer, for it would be useless to attempt to deceive him, and, to
quote his always picturesque language: "Never send a sucker to fish for
suckers or he'll lose your bait, so spread out your bricks and I'll get
the 'gang' to polish up their gildings." After the quality and amount
the "System" intends to work off in exchange for the people's savings
are explained, that part of the plunder which is to come to the head
news-bureau man is settled upon. The amount varies with the size and
quality of the robbery to be perpetrated. In some cases as high as a
million dollars in cash or stock or their equivalent has been paid to a
"moulder of opinion" for simply so shaping up a game that the people
might be deceived into thinking one dollar of worth was four, six, or
eight dollars.

The head of the news bureau, having taken the contract to lay out and
carry through the deceptive part of the scheme by which the people are
to be buncoed, now begins operations. First, bargains are made with
conscienceless financial editors of the daily and weekly newspapers,
whereby for so much stock or for "puts" or "calls" or both,[17] they
agree to insert in their paper's financial column whatever yarns are fed
them by the bureau man, regardless of their truth or falsehood. To
justify the attention paid the subject by each editor, a certain amount
of money is spent in advertising, in the newspaper that employs him, the
merits of the enterprise. The financial journals are dealt with about on
the same basis. In return for straight advertising or for "puts" or
"calls" they agree to insert the manufactured news. The news-bureau man
then puts his entire staff to work inventing fairy tales of one kind or
another to excite the interest and attention of the people, and these
tales must be so concocted that the public is drawn into believing that
the statements disseminated represent actual conditions. I shall, later,
give real instances of the working of this nefarious game of "moulding
public opinion," and present it in the lime-light necessary for its
appreciation. To show the extent to which this "moulding" process is
carried, I know in one instance of a high-priced financial scribe being
sent to live in St. Petersburg for no other purpose than to send certain
"news items" to a confederate located in Germany, who would get these
items to a reputable English banking-house through whom they were given
out in London as news: the whole object of this complicated system being
that the news items might be sent back to New York without Wall Street
suspecting they were bogus.

I must not be understood as meaning to say that all financial editors,
news gatherers, or news bureaus are engaged in this, one of the lowest
forms of swindling, for such is not the case. _On the contrary, there
are many of them whom no amount of money or influence could make waver
in their allegiance to the truth and to honest dealings._ With some of
the others I hope to deal specifically later, and I shall not hesitate
to set forth in detail certain transactions in which they have been
engaged.

FOOTNOTES:

[17] A "put" is the right to sell to a certain firm or individual shares of
stock at a stated price for a stated period, and a "call" the right to buy
under the same conditions. The holder of the "put" or "call" is under no
liability, as he can use the "put" as margin to buy stocks, or the "call"
as margin to sell stocks, or he can hold them for the profit there may be
in selling or buying the stock after it has declined or risen below or
above the price named in the "puts" or "calls" he holds.

CHAPTER VI

HOW WALL STREET'S MANIPULATIONS AFFECT THE COUNTRY

What is the connection between the "System" and the minor financial
institutions throughout the country which are owned and controlled by
groups of sturdy men who know not Wall Street and its frenzied votaries,
and who are ignorant of "made dollars"? Let us see. We will take five
national banks in different parts of the country, each having a capital
of $200,000 and deposits of $2,000,000. One is in the farming district
of Kansas; another is in Louisiana in a cotton district; a third is in
the orange groves of California; in the mining district of Montana is a
fourth; the fifth in the logging and lumber country of Maine. These
$10,000,000 of deposits represent savings earned by the type of men who
have made America what it is, and who laugh when they read in their
local papers: "Panic in Wall Street; stocks shrink a billion dollars in
a day." "Fools and their money are easily parted," they say, "but Wall
Street gets none of our honestly earned money." Now the officers of
these five banks are honest men and they know nothing of the "System,"
yet the day of the panic they each telegraph to their Illinois
correspondent, the big Chicago bank, "Loan our balance, $200,000, at
best rate." That day the Chicago bank with similar telegrams from
forty-five other correspondents in various parts of the country, wires
its New York correspondent, the big Wall Street bank, "Loan our balance,
$2,000,000, at best rates."

Thereupon the great New York bank sends its brokers out upon "the
Street" to loan on inflated securities of one kind or another which its
officers, the votaries of the "System," have purchased in immense
quantities at slaughter prices the millions belonging to the Chicago
bank and to other correspondents of its own in Cincinnati and Omaha and
St. Louis and other big cities. The decline is stayed, and then the
world learns that the panic is over and that the stocks, of which the
people have been "shaken out" to the extent of a billion dollars, have
recovered in a day $500,000,000 of it, and that probably in a few days
more will recover the other $500,000,000. Who has _recovered_ this vast
sum? The people who had been "shaken out"? No, indeed! The votaries of
the "System" have made it--they and the frenzied financiers whose haunt
is Wall Street, and whose harvest is in such wreckage.

The part that the five little banks innocently played in this terrific
robbery was unimportant. What is important is that it was the funds of
their depositors and others like them which the "System" used to turn
the Stock Market and make an immense profit out of the recovery of
values. It is true the banks received but two and one-half or three per
cent. for the use of their balances, and their officers would scorn the
suggestion that they had put any of their money in jeopardy in a Wall
Street gamble. But what I have outlined happened, and has happened many
a time before and since, and goes to prove my assertion that every
financial institution which is taking the money of the people for the
ostensible purpose of safeguarding it or putting it to use for them, is
a part of the machinery for the plundering of the people.

Sooner or later, every dollar taken by the "System" through Wall
Street's manipulation of stocks directly affects every man, woman, and
child in the United States. Let us, for example, see how a stock slump
in New York affects the owner of a small life-insurance policy in
Wyoming. The shares of the American and English ocean steamship
companies were bought up by the "System" at double their worth and
converted into a "trust." New stocks and bonds to a number of times
their value were issued and sold to the public. The great insurance
companies bought many millions worth of these securities, using for the
purpose the money they had collected from the policy-holders, a dollar
at a time. This "investment," at the moment it was made, actually
represented a loss to the purchasing insurance companies of millions of
money, for millions more than the property was worth or could possibly
be made worth had gone to the people who formerly owned the steamship
properties, and many millions more to the "System" as its share of the
swag. And it should be remembered that the men who organized the
steamship trust were the men who invested the insurance company's money
in its securities.

The policy-holder in Wyoming knows about the steamship trust and about
the terrible loss sustained by those who invested in its securities. He
does not realize, however, that his insurance company has been buying
such poor stuff, for he is persuaded it is a great and noble
institution, and far above Wall Street and its rash gamblers. Even when
he and his kind find their yearly dividends on their policies growing
less and less and their premiums rising "because of the tremendous
increase in the expense of doing business," they do not dream of
connecting these misfortunes with the "System's" trustifications of
inflated securities; nor do they associate them with the glowing
accounts of the half-million-dollar seaside palace built by the
insurance company's officer who entered the employ of the institution a
few years before, with his salary for his fortune, and who is now
pointed to as an example of thrift, being worth from ten to fifteen
millions.

CHAPTER VII

ECONOMICS OF COPPER

A thorough familiarity with the facts and conditions set forth in the
preceding chapters will help my readers to an understanding of the
series of complicated transactions through which the snaky course of
Amalgamated must be pursued. Its flotation was the most tremendous and
public ever even attempted, much less successfully carried out, and in
its market career the full resources of stock jugglery were exercised on
its behalf. The crimes of Amalgamated are to the delinquencies of Bay
State Gas as the screaming of eagles to the chirping of crickets. From
its birth this great enterprise went hand-in-hand with fraud and
financial dishonor, and the facts I shall proceed to reveal are so
formidable in their indictment as to startle even those calloused to the
trickery of modern stock deals.

An armistice followed that last desperate battle of the gas fight in the
Delaware court-house, and gave me time to turn my whole attention to the
plans I had long been maturing in my mind in connection with quite
another project--"Coppers."

For sixty years past Boston had been the home of the copper industry.
From it great fortunes had been derived, and there was in course of
development a copper aristocracy which threatened the supremacy of the
East India aristocracy that had so long lorded it in Boston society.
Indeed, so far had the rival contingents progressed that there was a
serious searching of the pretensions of any new-comer whose origin had
to do with other enterprises. "Coppers" were respectable, were genteel,
and, above all, were not "trade," for the average old-time Bostonian
affects the Anglo-Saxon contempt for the traffickings of retail
commerce.

For the benefit of those in the outer darkness, to whom the ways of
Boston are strange, it may be explained that the East India trade goes
elsewhere under other less euphonious names, and consisted in the
swapping of New England rum, made from molasses, water, and other
things, for human cotton-pickers. It was a most profitable industry,
with a spice of adventure to it, and in which at the time it flourished
a gentleman might honorably engage. It may be said that with the
paradoxical conscientiousness characteristic of the Puritan mind, the
first outcry against the personal ownership of human chattels was voiced
by New England, and her leading citizens generously devoted the incomes
of the fortunes their forefathers had amassed in the slave traffic to
releasing their colored fellow-creatures from bondage. That, however, is
still another story.

To return to "Coppers." In my young days in "the Street" in the early
'70s, the first task I remember performing was making deliveries of
copper stocks traded in by "the house" which was entitled to my
twelve-year-old services in return for the three large dollars which I
received each Saturday with far more honest pride than any three
millions I have since handled. As I grew up I watched Calumet and Hecla
advance from a dollar to 450 (it afterward sold at 900) because of its
real worth, and imbibed the conviction, which all true Bostonians
entertain, that money acquired through copper is at least 33 per cent.
better than money from any other source. I sympathized with the State
Street code which declares, or should: "Gold can be found in a day by
any one with eyes, silver in a week by any one with hands, and money in
a year by any one with sense enough to save it, but no man gets into
copper without capital, fortitude, patience, and brains." As a matter of
fact, it requires, even to-day, with all of to-day's facilities and
rush, $5,000,000 in money and five years of spending it after a copper
deposit has been found before it can be made to yield returns. Is it
surprising that a project requiring so much money for so long a time
should appeal to Boston's regard for endurance, expensiveness, and
exclusiveness? Could there be found an enterprise better calculated to
discourage the upstart?

My daily round of errands led me from broker to broker and from bank to
bank, and always I heard talk of copper. It is not remarkable that my
youthful mind became impressed with the profound importance of the metal
and all pertaining to it. I picked up a great deal of information on the
subject, which I fortified later with a careful study of copper the
metal, copper the mine, and copper the investment. As I mulled over the
immense returns obtained from their ventures by the men I knew had their
money in copper, it struck me as extraordinary that this industry should
be so much more profitable than others. Here was a great staple, a
necessity of the people, which had been in use since men began to sit
up, and would be needed until Father Time smashed his glass, that
returned 100 per cent. gross profit on the business done in it, while
the business done in any other staple did not return, gross, over ten to
eighteen per cent.; which gross profit gave to the capital invested in
copper a net profit of sixteen to twenty-five per cent., while that
invested in the other staples returned a net profit of only three and
three-fourths to four and one-fourth per cent.[18] The value of money
had decreased with the world's development; the cost of the great
commodities of life had all come down with the decline in interest--all
but copper, which kept its old places throughout all the changes that
had occurred in the relations of capital to labor and business. I
realized that copper, in that year, would afford a gross profit of 100
cents on each $2 worth produced; that this great gross profit was
legitimate, was not brought about through unfair restrictions or forced
combination, or evasion of the country's laws, but was wholly natural,
being founded on the fact that the supply was so limited that the demand
prevented the price dropping below a certain figure, and that this under
ordinary circumstances represented at least 100 per cent. of gross
profit to the producer after he had paid for labor and material the
highest ruling prices.

No better illustration of the main facts about copper can be found than
the condition of the industry to-day, in 1905. The metal is now fifteen
and a half cents per pound, and the consumption so great that the price
still advances, yet if through an agreement among the producing mines
this sales-rate should be dropped twenty-five per cent., it would so
increase consumption as to force back the price to a point that would
again discourage consumption; and yet in the old mines the cost of
producing the metal sold at fifteen and a half is but six to seven and a
half cents, in some even lower.

Compare these conditions with those existing in the steel industry.
Therein unlawful combinations and unnatural restrictions are essential
if those engaged would show a gross profit of even fifteen per cent. on
their gross output. If more than fair or going returns are earned, then
new capital flows into competition and the surplus again shrinks to an
uninviting point. The same is true in wheat, corn, and cotton--big
prices invite fresh investments and the planting of broader acreage.
Hence the sorry spectacle of the cotton planter who, in 1905, will
receive no more for his twenty per cent. increased crop, coming from
over two millions increased acreage planted last year, than for his
smaller one of the year before.

That my readers may quickly, and once for all, grasp the point I wish to
make, I will illustrate:

The Steel trust in 1904 did a gross business of $432,000,000, upon which
they made a profit of $71,400,000, and yet this vast amount was only
five per cent. upon the trust's inflated capital of $1,400,000,000 odd;
and as the "System," in regulating the capitalization, arranged that the
preferred stock (and bonds), which represented the "System's" profit,
should receive seven per cent., there was not a dollar in dividends for
the $520,000,000 of common stock which had been sold to the people for,
in round figures, $300,000,000.

At the same time the Calumet & Hecla Copper Company produced and sold
over $10,000,000 worth of copper, upon which it earned, net, over
$5,000,000, which enabled it to pay to the people who had invested in
its 100,000 shares of stock (par value, $25), 160 per cent., or a total
of $4,000,000, and, at the same time, carry an enormous amount to its
surplus.

In the commercial world copper occupies an impregnable position. To
compete, it is first necessary to find a copper deposit; then to lock up
a vast sum of money for a long term of years before returns begin to
accrue. And new copper deposits are as rare and few and far between as
Lincolns and Roosevelts in politics or Grants and Lees in war. In the
last eight years, or since the metal has been prominently before the
world of capital, but two great producers of copper have been
created--the Copper Range at Lake Superior, Michigan, and the Greene
Consolidated in Mexico--and these two mines have only, at the end of six
years, after an immense expenditure of millions (Copper Range, with a
capital of $38,500,000, 385,000 shares, par $100, which sold in the open
market a few years ago at $6, now selling at $75, and Greene
Consolidated, with a capital of $8,650,000, 865,000 shares, par $10, now
selling in the open market at $25), reached the point of profitable
production. Their combined output, while reaching the (for young mines)
unprecedented amount of one hundred and odd million pounds of metal per
annum, constitutes but a fraction of that which Mother Earth has given
up during the period of their development, namely, 2,500,000,000 pounds,
all of which has been disposed of and cannot again be used to satisfy a
ravenous consumption.

It seemed to me, then, a curious anomaly that, while capital was chasing
investments which promised but four per cent., it eschewed copper which
yielded from sixteen to twenty-five per cent., and my investigations
told me that a producing copper-mine is the surest business venture a
man engages in, for, by the time it begins to produce profitably, it
must be so far developed that its owners are certain of ore to work on
for decades ahead. A good copper-mine is really a safe-deposit vault of
stored-up dividends, which cannot be stolen nor destroyed by fire,
flood, or famine. Calumet & Hecla, for instance, though it cost its
first owners but a dollar a share, has paid out $87,000,000, or $870 per
share, or 3,480 per cent. on its par value of $25, and while it has been
paying dividends over thirty-five years, it paid last year $40 per
share, and has more in sight than it has yet paid. And Copper Range,
though but six years old, will be producing soon as much as Calumet &
Hecla, and has now in sight ore to keep it going fifty or sixty years.

Having pieced together all the facts and circumstances in this
connection, I was sure that I had grasped a principle of great
commercial value, and I set about finding a cause why the world of
capital should for so long have overlooked the tremendous potentialities
of this industry. I found the cause in Boston herself, in the
characteristics of the city, which was head-quarters for copper, and
which had grown in financial power with the revenues her mines earned
for her investors. Boston controlled and managed the copper industry,
and had since the days when copper-mining was a hazardous pursuit, in
which only bold and speculative souls dared engage. In the early days
the canny Bostonian demanded for the honorable dollar his parent had
earned--exchanging five-cent rum for human beings worth $1,000
apiece--at least twenty per cent. interest, and having acquired this
habit, it became a principle, and such principles as these are clung to
in Boston with the zeal of a miser for his hoard or of a martyr to his
faith. Looking back over the years, I still recall with chagrin the
quiescent hilarity of the scion of a Back Bay family whose good father
had been one of the most successful and most brutal of all the "East
India traders," when I suggested to him that he was fortunate in
obtaining twenty per cent. on some copper ventures about which he was
grumbling. (My readers must not confuse a Boston grumble with the
ordinary ejaculations of discontent indulged in by the inhabitants of
other portions of the world remote from the Hub of the Universe. A
Boston grumble consists of an upward movement of the eyebrow, a slight
twitch of the mustache and a murmur cross-bred from "Deuce take it!" and
"Scoundrelly!") "Young man," he said, "my father said that such a
hazardous venture as copper should return at least thirty per cent. to
be safe, and I feel if I receive but twenty per cent. that something is
radically and unpardonably wrong with the management of the mine." I did
not pursue the argument, for I knew he inherited with his fortune a line
of Boston reasoning, and I remembered once having watched a country boy
put his tongue on a frosty iron door-knob. I knew better than to invoke
again that wintry Boston smile, which in a Western or Southern community
would be used to _frappé_ mint-juleps or cold-storage hogs with.

No better illustration of the attitude of the shrewd New York investor
to "Copper" can possibly be given than to detail my first interview with
H. H. Rogers and William Rockefeller on the subject. To-day Mr. Rogers
is known throughout the world as the leading figure of the copper
world--the copper Czar, so to speak; yet it was only nine years ago when
I said to him at the end of a gas-talk:

"Mr. Rogers, would Mr. Rockefeller and yourself look into Copper?"

"Copper?" said he in an amused way, "copper? What kind of copper?"

"Why, copper such as we know in Boston--copper the metal, copper the
industry, copper stocks."

He burst into one of his jolly laughs. "Look into it? Why, I don't know
a thing about copper other than that we had old copper kettles when I
was a boy which were used to fry doughnuts in, but I suppose my plumbers
would look at anything you wanted, for I remember I get big bills for
copper tanks at the house."

FOOTNOTES:

[18] For those unacquainted with such business terms as "gross" or "net"
profit: Gross profit on business done is that first profit which remains
after deducting the first cost of producing the goods--in this case copper,
the metal; and from this gross profit must be deducted other expenses, such
as unusual development expenses, the expense of running the executive
departments, interest, etc. This leaves the net profit which is available
for dividends.

CHAPTER VIII

MY PLAN FOR "COPPERS"

The plan I had so carefully formulated in connection with "Coppers" was
simple in application yet vast in scope. It was to buy up all the good
producing mines at their market price, or double if necessary, to
organize them into a new corporation and offer its stock to the public
at a capitalization of double the original cost. By advertising the
exceptional merits of the copper industry and the financial power of the
men who were backing it, the public would become educated to a knowledge
of the values of "Coppers." Under this education the world of capital
would invest in copper shares until the price had advanced, because of
so much capital seeking this form of investment, to a point where the
net return was brought down to the going rate of, say, four per cent.
This would mean that the old going prices of good producing Boston
copper-mines would advance 100 to 200 per cent., which in turn meant
that those who risked their money in the first venture (which I figured
would require $100,000,000) would make $100,000,000 to $200,000,000,
while at the same time the public would make $200,000,000 to
$400,000,000. This seems like an "Aladdin-lamp" story when it is told,
but, as a matter of fact, prices afterward did advance in this ratio,
and 100 and 200 per cent. beyond, and many of them, notwithstanding the
tremendous drops that have taken place since, still show from 200 to 300
per cent. advance over the prices then in vogue. _Never in all the
history of business was there afforded capitalists so fair an
opportunity to make honestly and legitimately so vast a sum of money and
at the same time to do so much for the people. Nor was there a more
honorable undertaking nor one which a man could be more justly proud of
carrying to success._

As time went on, this big enterprise was more and more in my thoughts,
and I tested it in every way I knew, going over in my mind and trying
out each successive step and link until I was certain the whole
structure was unassailable. Then it became my purpose in life to launch
the venture. The difficulties of the task were never for a moment
overlooked, for I well knew that much money would be required, but with
strong backing success was sure, and such a success was tremendously
worth attaining. Next to putting in force my financial invention which
would remedy the evils of the "System," this great copper project seemed
the thing--the dollar thing--best worth doing in all the world. It was
to execute this project that I allied myself with the "Standard Oil"
party, for with their money and backing I knew I could carry through my
plans on the lines I had so carefully mapped out.

The chief indictment my critics brought against me when my series of
articles appeared in _Everybody's Magazine_ was that I had turned
"State's evidence." Having been "in with" "Standard Oil" in their
robberies of the public, it was not until we disagreed and "split" that
I thought of taking the public into my confidence. The truth is, my
relation with "Standard Oil" was different from that any other man ever
had with that mysterious and reticent institution, and throughout the
copper crusade I insistently blurted out our plans and purposes through
every channel of publicity I could command. At no time was there the
slightest secrecy. From the very first day of the campaign I told the
story as I tell it here, and I told it from the housetops by newspaper
interviews and advertisements, market letters and circulars frankly and
freely explaining what I was about. The absolute truth of the foregoing
is easily proved through existing records, for the press of the country
contains an almost continuous story, beginning in 1896 and running up to
date, wherein I have openly and fairly told what I knew about "Coppers"
and detailed the progress of our plans. Time and again, during this
period, financial writers commented on my frankness, quoting brokers
and bankers to the effect that "Lawson will surely have his head dropped
into the 'Standard Oil' basket if he keeps telling people all he knows
in this fashion." For the complete realization of my project the
public's interest was essential. The creation of the vast business
structure that I had designed required the participation of the great
mass of the people, and I was determined that no subservience to the
selfish ends of my associates should swerve me from my plan. I saw the
enterprise whole; saw that there was great profit for all concerned, for
"Standard Oil," for myself, and for the public; but if the public were
not taken care of or were discouraged from participation, then my
institution would surely be only another combination of capitalists and
I should fail in my ambition.

This is why I so persistently kept in the open throughout my "Copper"
campaign. I fully realized how anomalous my position was and how far I
had departed from "Standard Oil" precedents; but my thought was to
protect the integrity of my enterprise, and the best way to do this was
to have the people partners in its conception and development. To be
perfectly frank, the prospect of millions of profit counted for less in
my calculations than the honor and prestige I foresaw in the success of
my copper structure. As proof of this, witness how I voluntarily gave
back the millions I had secured, to make good. To create a great
institution, to erect a new and absolutely staple investment, and in
doing so to make millions for one's partners, one's self, and the
public, would be to live not in vain. The knowledge of my attitude will
perhaps help my readers to comprehend the enthusiasm with which I
entered into my "Copper" crusade; help them to understand how strongly I
resisted, and how deeply resented, the perversion of my fair structure
into a pitfall for those I had expected to benefit. My indignation
against the "System" is that which any honest man would feel against
ruffians who had used his best ideas and his most generous feelings to
lure innocent and unoffending people into some den of vice and infamy.
If I have not troubled to correct the misstatements of detractors who,
in an attempt to discredit my facts, have tried to pillory me as a
traitor, it is because I knew that when my complete story reached the
public it would make plain how and what I had been doing. The succeeding
chapters of this narrative will yield unimpeachable evidence that all my
dealing in "Coppers" as an associate of "Standard Oil" were open and as
much in the interests of the people as it was possible to have them.

CHAPTER IX

BIRTH OF "COPPERS"

Active upon the Boston market during my Bay State Gas operations were
two copper-mining companies--the Butte & Boston and the Boston &
Montana. Their properties were in Montana and both were large producers
of the metal, that is, they were old and equipped mines. These two
organizations form to-day the most valuable part of the Amalgamated
Copper Company--in fact, more than three-quarters of all the real worth
owned by that corporation.

Butte & Boston and Boston & Montana were essentially Boston
institutions, and were both officered and directed by the same set of
men. It had come to my knowledge, in the course of my stock business,
that there had been bought for the Butte & Boston, with its money, some
very valuable mines; instead of transferring these to that corporation,
however, its directors at the last minute had turned the titles over to
the Boston & Montana. It is only fair to these men to say that up to the
present this alleged fact has not been proven, although set forth in
cases still pending in the courts. This curious proceeding was part of a
plot the subsequent steps in which would be to run Butte & Boston
through the bankruptcy mill, and, by placing it in the hands of a
receiver, to drop the stock to a nominal figure, at which it might all
be gathered in from the public. I verified my information sufficiently
to decide to act, and swung the red danger-signal in a public statement
telling the stockholders and people in general of the coming move. At
once there arose a chorus of denials and recriminations from the
management, and the cry, "He's short of the stock and is working a fake
to scare us into throwing over our holdings that he may buy them," from
the Stock Exchange, stockholders, and the hireling moulders of opinions,
the "News Bureaus."

The rôle of Cassandra is not more popular to-day than it was in ancient
Troy. The swinger of the red danger-signal is seldom heeded, and is
invariably suspected of interested motives by the human moths circling
round the flickering flames of frenzied finance. When I gave my warning,
Butte & Boston was selling between 25 and 30. In accordance with their
plan the insiders began to sell, and soon the price began to slide
downward, for the great majority of the stock was held by the people.
There was a halt when the denials of the management were heard, but only
for a moment. The decline continued, growing swifter as it got lower
until the stock struck $2 per share. At this stage, while the stock was
on the way to $2, just as I had predicted, the property was cleverly
slid into a receiver's hands by the very men who had so indignantly
denied my statement that such would be their action. An assessment of
$10 per share was next levied, and those who held on, hoping against
hope, began to throw over their holdings for what they would
bring--which was around a dollar.

So far the scheme had slipped smoothly along the single-rail track
constructed for it by those in the deal, and just as my information had
led me to expect. At this juncture, however, the train struck an open
switch, and with a painful jolt for the conductor and the engineers it
slid out on a siding--it was my siding. From the time the stock struck
$2 a mysterious purchaser took in all that was offered, and when it
struck bottom he was still buying. Suddenly the schemers "tumbled" that
the plums they were shaking off the tree were dropping into some other
bag than their own, and they started into competition for the coveted
fruit.

Next day, and for several days afterward, there were strenuous doings in
Butte & Boston on the Boston Stock Exchange. The trading was heavy and
the price pushed up from the bottom to 6-1/2. Soon, however, it was
slammed to 2-3/4, then back to 6 again, down to 3-1/4, back to 5-3/4,
and so on, until the middle of the fourth day, when the rival News
Bureau to the "System's" favorite opinion-moulder sprang the following
notice set forth on a double-leaded sheet:

     "We have just solved the Butte & Boston conundrum. The
     enormous blocks of stock purchased during the past few days
     have come in for transfer, and the management now know who
     owns the bag into which all the stock they have for months
     been planning to acquire dropped. We have unmistakable
     evidence that the bag belonged to Lawson, and that he now is
     in control of the Butte & Boston Company. A hasty
     investigation amongst the leading floor brokers which we
     have just made brings out a consensus of opinion that there
     will now be music in Coppers."

The announcement was calculated to interest a good many persons, and I
was the target of a thousand inquiries. In answer to the innumerable
calls for a denial or confirmation of the statement, I issued the
following:

     'Tis true. 'Tis my bag, and there are 46,000 shares in it.

It was not until the following morning that I realized what a rarely
presumptuous thing I had done. I had invaded a valuable preserve. I had
coarsely "butted into" a private copper domain without a by-your-leave
to the natives who thought it belonged to them. I was an interloper, an
intruder, an upstart. The prevailing opinion seemed to be that it now
devolved on me to present what I had purchased to those who had been a
bit late in getting to the bargain-counter, or that I should, at least,
turn it over to the conscience fund of the Stock Exchange. The copper
market reflected the indignation of the baffled schemers. It entered for
once into an open competition with Donnybrook Fair, and to judge by the
action and feeling developed in both individual and corporation classes,
the Hub had Donnybrook jigged to a wind-up. In my various contests with
the "System" I had accumulated a certain hardihood which now stood me in
good stead. I had learned before this that breaking into a secluded
treasure-trove is about as pleasant as taking the lining out of a steel
furnace with the metal sizzling and the blower on.

I stood to my guns for the time being and then charged into the ranks
of the enemy. I issued the following statement:

     TO MY FELLOW-BROKERS AND THE PUBLIC

     I have stumbled on the fact that the stock--capital 200,000
     shares--of the Butte & Boston Copper Mining Company is a
     nugget. I bought about 46,000 shares of it at an average of
     something over 2-1/4, or, with the assessment paid, 12-1/4
     per share. I am going to hold it until I get over 50 for it.
     Barring accidents, I shall get it.

     I advise--strongly and unqualifiedly advise--all my friends
     and the public to load up with it at anything under that
     price. My friends and the public know whether or not I mean
     a thing when I say it. I pledge them that I not only mean
     this but that I shall fight it out, and shall not sell until
     there is an active and legitimate market for not only my
     stock, but for what they buy, at over $50 per share. All
     intending purchasers must bear in mind this is not a sure
     thing, for the men who are opposing, and will oppose me, are
     not conducting their operations from a graveyard, but are as
     lively and aggressive as Bengal tigers at raw-meat time; but
     they may rest easy in the knowledge that barring tripping
     over stumps or into bogs, I'll give whoever buy a run for
     their investments.

     Buy and watch Butte all the time, and, above all, pay no
     attention to what the fake "News Bureau" says.

This was the formal declaration of war. State and Wall streets, familiar
with my style of fighting, at once lined up and took sides. The papers
entered the controversy. According to what one read, Butte & Boston was
either the greatest mine in the world or a hole in the ground. Feeling
intensified; Geneva and Queensberry conventions were forgotten; it
became a go-as-you-please scramble; mud batteries filled the air with
liquid dirt, and both sides used Gatling guns to fire off their libels.
It was altogether a lusty and vociferous contest, which meant
destruction and death for the lame, the halt, and the slow-footed who
got between the fighting lines. I was naturally the chief mark for the
enemy, and was deluged with vilification. In the Bay State campaign I
had learned the personal cost of antagonizing the "System"; the copper
magnates showed me that they had terrors at command which might make
even "Standard Oil" jealous. In those days I don't believe my bank
account varied thirty-five cents without the news being passed around
before the ink on the bank-book was dry, and my family, down to my
ten-year-old, received daily or weekly through the mails pictorial
representations of their parent being hustled along to the realms where
sulphur is the standard of all values. Here is a sample of my usual
breakfast-table reading:

     C. W. Barron, the proprietor of the "Boston News Bureau,"
     feels it his duty to inform his readers, the banks and
     bankers and brokers and representative investors of New
     England, that that faking ass of State Street, that knave of
     knaves, Tom Lawson, is braying again, and such
     braying!--"Butte is to sell at 50, and going to be worth
     50." It would be such a joke that this conservative paper
     would be only too happy to circulate this scoundrel's
     vaporings, if it were not for the sad part of such schemer's
     work--if it were not that the poor and ignorant unfortunates
     who are unacquainted with this knave, may buy Butte because
     of his advertised lies at $14 or $15 a share and thereby be
     robbed of what they can ill afford to lose. There is no more
     chance of Butte & Boston stock selling at $50, or even $25,
     than there is of Tom Lawson telling the truth; and this
     paper does not hesitate to say that if Butte stock ever does
     sell at 50, we will upon that day close up our office and
     forever leave Boston and our lucrative business of guarding
     investors against such knaves as this lying thief; for any
     man who would do what he is doing to fleece investors is a
     thief and should wear stripes, and it is surprising to us he
     has so long escaped.

It was not so long after the above appeared that Butte & Boston stock
was selling at $130 per share, and that the same Mr. Barron was using
his own and his "News Bureau's" best efforts to induce the people whose
Butte showed them over $115 a share profit to exchange it for
Amalgamated. At this latter time he was acting for "Standard Oil."

It may be added that this same Butte & Boston stock, which I was such a
knave to advise the people to buy at twelve and fifteen, sells to-day in
the form of a share of Amalgamated, for which it was exchanged at
seventy-five to eighty-dollars, not cents.

My chief weapon in this Butte & Boston fight was publicity. Every
morning while the battle waxed hottest I had huge, striking
advertisements in the papers urging the public to buy and to hold on to
what they had bought. My opponents responded in kind, and being
intrenched in the management, told such alarming stories of the mine
that it was often as much as I could do to prevent my followers from
being scared into throwing over their holdings. The tremendous expense
of this mode of warfare, together with the immense sums my market
operations required, kept me hustling, and there were times when things
looked distinctly blue. However, the value of victory is measured by the
fierceness of the tussle, and far be it from me to complain of my
opponents' energy. There was good fighting over Butte & Boston.

The more deeply I became interested in this struggle and the more
familiar I grew with "Coppers," the more advantageous and profitable
seemed the prospects of such a consolidation of copper properties as I
had in mind. The large holdings of Butte & Boston I had accumulated in
the battle gave me a practical basis for my structure, for I could now
afford to do all my own part of the work of organization for what I
would eventually make when the consolidation was brought about, and I
could get for my shares what I knew they were worth. It was at this
stage I broached the subject of "Coppers" to Mr. Rogers, and discovered
to my surprise that he knew nothing about it or its possibilities,
notwithstanding that "Standard Oil" has a department for the sole