The Industrial Conflict in the Light of Revelation.
By Geo. W. Rine
CAPITALISTIC MONOPOLY AND OPPRESSION.
During the first century of the American Republic, obsolete laws and usages, the reign of popular ignorance, the tyranny of kings, the horrors of chattel slavery, and, above all, the despotism of religious dogma, were to a large extent overthrown. Marvelous, too, was the development of constructive science and of political liberty and popular government, during the same period. A counter tendency, however, has set in, a tendency toward industrial despotism. Union and organization are in themselves expedient and helpful; but if controlled in the interests of a few, they speedily become despotic, whether in the sphere of religion, civil government, or industry. For thousands of years political tyranny and religious despotism were the common lot of humanity. To the masters of political federations government was private property to be exploited for their personal benefit and to be used as a means of extorting from the people the utmost tribute in service and taxes. The whole trend of thought and action in the realm of politics during the last two centuries was an irresistible protest against private monopoly of government. Yet the closing years of that same period were marked by the birth and swift development of the “Trust,” or private monopoly in the industries. Evolution of the Monopolistic Trust.
In the article I contributed to the last week’s issue of this journal, a mass of statistical and other evidence was adduced, illustrating the startling rapidity and the approximate completeness which have marked the concentration of our enormous present-day wealth into the hands of a relatively few persons. This resistless tendency toward the congestion of wealth is strikingly exemplified by that notorious institution of to-day, popularly called the “trust.” The term needs no explanation. It has become current coin in the vocabulary of all classes of society. The tendency for great corporations to merge into still greater corporations until nearly all the productive forces in any one industry have been amalgamated into one great body has been a comparatively recent movement, and has come with startling suddenness. Fifteen years ago there were less than a dozen industrial combinations in America, which might be called trusts in the accepted sense of that term to-day. According to Mr. John Moody, a widely-known writer on economics, there are now in the United States 445 trusts, capitalized at $20,379,162,511. In these it is not millions, but billions, that pile up, and baffle the wings of imagination. The trust movement can no longer be thought of in seven and eight figures; eleven figures are now required to express its stupendous meaning. This unique movement has been the growth of a few years, of less than a generation. The total capitalization of these mammoth business consolidations exceeds one-fifth of the aggregate wealth of the nation. The trusts formed in the year 1899 alone represented a capitalization of $4,000,000,000, a sum equal to two times all the metal currency in circulation in America. The spring of 1900 was, however, only the midday of this consolidation movement. Previous to 1897 only sixty-three of these “combines” had been formed, while more than fifty per cent of the 445 were formed during the eighteen months from Jan. 1, 1899, to June 30, 1900. The movement has since then swept forward like a great tide. The combination of manufacturing companies for the first five months of 1901 alone exceeded $2,000,000,000 in capitalization. This unprecedented rush to industrial and financial consolidation is universally regarded as the paramount wonder of the close of one century and the beginning of another. Magnitude of Individual Trusts.
The average mind can form but an inadequate conception of the magnitude of these concerns. A New York newspaper recently made some computations on the United States Steel Corporation, which help us to form some realization of the size and power of that leviathan syndicate. Its net profits for 1902 were double the total revenues of the United States in the year Lincoln was elected. Its wage-roll carries on an average of the round year over 58,000 names—an army of employees larger by 45,000 than that which serves the National Government in every branch of its civil service, classified and unclassified, except only fourth-class postmasters. The wage-payments of the same year aggregated nearly $113,000,000. Its annual production of steel is 10,000,000 tons, sixty-seven per cent of the total production of the country; and its freight bill for 1901 amounted to more than $54,000,000. This prince of the trusts was organized as late as 1901, with a capital approximating $1,400,000,000. Out of this vast total an enormous quantity of “water” has been “squeezed”; but conservative financiers admit that the solid capital of the corporation still exceeds one billion dollars. Its scores of thousands of men are employed in its coal and iron mines, in its furnaces, in its steamers, in its limestone quarries, in its docks, in its railways, in its coking ovens, in its mills, in its offices. “Millions depend upon the use of its products for their livelihood—builders of bridges, of edifices, of safes, of toy pistols—users of iron and steel in every form.” Approximately all the sources and the productive forces of the oil industry of the country have been amalgamated into one great corporation, now known as the Standard Oil Company. Beginning with a small company, chartered in Ohio, John D. Rockefeller gradually systematized and extended the business of producing and distributing oil until he controlled ten separate corporations, chartered in as many different states. In 1872 Mr. Rockefeller conceived and carried into effect the idea of merging his state companies into a single body, officially entitled, the Standard Oil Trust. At that time he controlled a little more than one-half of the entire output. Three years later he was the absolute master of two-thirds of the output, and practically controlled the market. From the beginning it was the Standard’s avowed policy to crush competition, and at no time has this policy been departed from. As a result the Standard is to-day the undisputed master of eighty per cent of the output of American petroleum. Including its good-will and earning power, this lordly syndicate controls a capital of $650,000,000. Its yearly profits amount to $225,000,000. The annual income of the Standard’s president exceeds $30,000,000. Its monopoly of this world-wide industry is admittedly absolute. Mr. Rockefeller virtually dictates the price which must be paid by the hundreds of millions of consumers. A writer, in a recent number of the International Economist, says: “The three greatest trusts in the world are the Morgan group of railways, with a capitalization of $2,265,116,350, the Pennsylvania group, with a capitalization of $1,822,402,235, and the United States Steel Corporation, with a capitalization of nearly $1,400,000,000.” These figures practically make J. Pierpont Morgan the dominant financier of the United States, if not of the world. Industries involving a capital of $3,635,116,350 are subject to his undoubted control. All the gold in existence, from every clime and country, amounts in value to a little more than $8,000,000,000, just a little more than twice the value of two of Mr. Morgan’s great creations.” The Amalgamated Copper Company controls a capital of $175,000,000; the American Smelting and Refining Company, $201,550,400; the American Sugar Refining Company, $145,000,000; the Consolidated Tobacco Company, $502,915,700; and the International Mercantile Marine Company, $170,786,000. Finally, the six great railroad groups of the country represent capital aggregating nearly ten billion dollars. The trust movement is obviously destined to spread over the entire field of production and distribution. The universality and spontaneity of the movement have startled the attention of the thinking men of the world. Hardly an industry, even at this date, has escaped consolidation. The term monopoly means the power of exclusive buying or exclusive selling or both. It therefore implies control of the price in buying or in selling or in both. Where competition is excluded, there we find monopoly. Being able to control the whole supply or the whole demand of a given commodity, the trust magnates are, of course, able to control the price. This all the great trusts are really able to do. Most of them have a few, though insignificant, competitors. But their control of prices is so nearly exclusive, or absolute, that, practically, they are monopolies. Let it be understood, however, that not all monopolies are sinister or menacing in their nature. The Federal Government has a monopolistic control of the postal service of the country—a control essentially advantageous to the people. Other legitimate monopolies are the exclusive right to sell inventions and books, secured by patents and copyrights. Monopoly has its uses. It is the abuse of monopoly that has so terribly stigmatized it in the popular mind. “Monopolies in the hands of those who do not love their neighbors as themselves will ever become an infernal machine. The great trouble with human monopolists is that they have conceived for themselves a new version of the Golden Rule: ‘Do unto the other fellow as he would like to do unto you—and do it first.’” It is “the love of money,” it is greed, that has made monopoly a synonym of oppression and of extortion.5 It is admitted by trust magnates themselves that they control from seventy per cent to ninety-five per cent of the output of the productive industries, in which they are formed. Industrial plants, often thousands of miles apart, are amalgamated into one organization by trust managers. The American Steel and Wire Company’s plants are located in ten states, from Massachusetts to California, inclusive. The plants of the American Sugar Refining Company are scattered over seven states, including Louisiana and California. These two are a sufficient illustration. The sugar trust referred to above controls ninety-five per cent of the sugar output; the United States Rubber Company handles sixty per cent of the rubber trade; the American Tin Plate Company controls ninety per cent of the tin plate business; the International Paper Company produces sixty-five per cent of the news-print paper; and the consolidated whisky combinations control about ninety-five per cent of the distilling business of the entire country. These examples attest the practical monopoly which the trusts have attained. Competition has been strangled by cut-throat methods. The multi-millionaires in control of the trusts are abundantly able to sell an article for less than cost, until all competitors “go under.” The president of the National Salt Company frankly admits that his policy is to sell below cost wherever there is competition, and to recoup himself off the general market. He emphatically points out that such a policy is universal in business of every size wherever there is competition. The Standard Oil Company has become notorious for its use of the “freezing out” method of crushing competition. It is by such tyrannies of the self-constituted despots of the market that thousands of small business concerns have been ruthlessly crushed. Ah, how true the inspired declaration, “The love of money is the root of all kinds of evil!” Collusion with the Railways.
In one of its recent reports the Interstate Commerce Commission said: “There is probably no one thing to-day which does so much to force out the small operator and to build up these trusts and monopolies, against which law and public opinion alike beat in vain, as discrimination in freight rates. This problem is so serious that it will soon attract an attention which has not yet been given it. There can be no doubt that special favors from railroads were a prominent factor, probably the most important factor, in building up some of the largest combinations.” “By reason of their control of enormous traffic, the trusts are able to dictate to the railways the terms upon which they will purchase transportation.” Those who have read the late H. D. Lloyd’s remarkable book, “Wealth against Commonwealth,” will recall the overwhelming evidence there given that the absolute monopoly and the crushing preponderance which the Standard Oil Company enjoys are very largely the result of the secret rebate granted the company by the great railways and other common carriers. The independent oil producer was thus speedily and unceremoniously “frozen out.” Apropos of the great anthracite coal trust, Mr. Lloyd wrote: “The official of the Pennsylvania Railroad, by the use of the rebates, handed over the state of Pennsylvania to three coal-dealers, each of whom had his territory, and was supreme in it, as the would-be competitors found out where they attempted to ship coal into his market. They made a similar division of the iron and steel business. The rebate is the ‘golden rule’ of the ‘gospel of wealth.’” To-day the coal mines and the coal-carrying railroads are owned by the same capitalists. Hence, the independent coal-miner has not a “ghost of a chance” to make a success of mining. “The Sugar Trust and all the other capitalistic trusts are favored by the railroads in just the same way.” As long ago as 1888 it was estimated that out of $800,000,000 paid yearly in this country, for the carriage of freight, nearly $100,000,000 goes to favored shippers, by way of rebate. A famous financial expert, as a result of a personal examination made for the enlightenment of stockholders, ascertained that one of the great trunk lines had in the last twenty years thus diverted to favorites of the managers $100,000,000 of the money of the stockholders. “Pay our price or do without,” is the contemptuous challenge which the great trusts hurl into the teeth of the whole consuming world. Collusion with the Banks.
Even the banking institutions of our great money centers have not escaped the all-conquering tide of concentration so dominant in our age. The National Bank of New York is not only the controlling head of a dozen other large banks of that city, but has also become the undisputed master of sixty other banks in widely-scattered parts of the country. This chain of financial houses is controlled by Mr. Rockefeller and his associates. Through those twelve New York banks alone, the Rockefeller interests dominate the use of nearly one billion dollars. Another chain of banks nearly as opulent as the Rockefeller chain is controlled by J. P. Morgan and Company. Together these two alliances have at their disposal about one-half of the banking capital of New York City. Not only are they ready at a moment’s notice to loan millions and to undertake any vast enterprise for the favored trusts, but “by their preponderance in the money market they are able to force the rivals of the trust to borrow at disadvantageous rates.” This iniquitous alliance between the trusts and the banking institutions is perhaps the most remorseless and powerful weapon used by the Napoleons of finance to annihilate competition. The following excerpt from The Economist, of London, is at this point most pertinent:— “The sinister influence of the trust financier is everywhere felt in the United States. Their power over the New York banks enabled them to compel those institutions to overlend their resources, with results little short of disastrous. Their attempts to dominate the industries of the country have been productive of grievous injury to the people, and the control which they exercise over the railway systems of the United States has given them the power to mulct the shareholders in a fashion that never would be tolerated here. One can not help wondering at the lamb-like submission of the American public under this tyranny, and asking whether the trusts are sufficiently powerful to dominate the legislature as well as the general interests of the country.” It is evident that but few kings of the olden days exacted so vast a tribute from the people as do the kings of steel and emperors of oil in America to-day. History proves that it is usually only one step from the control of a nation’s wealth to the control of its political institutions—from the undermining of its industrial freedom to the subversion of its political freedom. And that step has already been taken, at least to the extent of debauching the institutions of government. This we shall demonstrate in a later paper. “To what purpose?” the reader may ask, “is your extended discussion of the industrial and monetary consolidations of the day?” My answer must be brief. Do we not see plainly that to-day rich men heap their “treasures together,” that they live “delicately” and are “wanton”? Do we not see that this is an age of brutal selfishness, of remorseless greed, of crass commercialism, of disgusting sycophancy toward the rich, of voluptuous idleness and wanton luxury? All this, according to the emphatic predictions of Holy Writ, was to be a marked characteristic of the last days. See James 5:1–9. Compare Eze. 16:49, 50 with Luke 17:28–30. The former reads thus: “Behold, this was the iniquity of thy sister Sodom, pride, fulness of bread, and abundance of idleness was in her and in her daughters, neither did she strengthen the hand of the poor and the needy. . . . Therefore I took them away as I saw good.” Now let us note the application that Jesus makes of the foregoing description of the experience of Sodom. “Likewise also as it was in the days of Lot [Sodom]; they did eat, they drank, they bought, they sold, they planted, they builded; but the same day that Lot went out of Sodom it rained fire and brimstone from heaven, and destroyed them all. Even thus shall it be in the day when the Son of Man is revealed.” The buying, the selling, the planting, the building, prosecuted by the Sodomites, prove the greed, the opulence, the commercialism of that age. Is not this age, in these particulars, the exact counterpart to that of Sodom at the time referred to? Is not our age repeatedly referred to by the clergy, and by our magazine writers as the age par excellence of materialism and commercialism? “Even so,” declared the Master, “shall it be in the day when the Son of Man is revealed.” Observe how in the heaping of treasures, in surfeiting and banqueting, in neglecting the claims of the poor, in extortion and oppression, society is to-day not only repeating, but outdoing, the orgies, the voluptuous pleasures, and the haughty selfishness of the ancient Sodomites. It is when this condition of things obtain in the world, that James declares, “The coming of the Lord draweth nigh.” This discussion is intended solely to help the reader to know this solemn truth.