The Conflict between Private Monopoly and Good Citizenship

For a special purpose, I have had occasion to examine with care the comments upon American life and institutions made by foreign critics during the period that extends from the later part of the eighteenth century up to the present time. If one puts aside the frivolous and ill-tempered studies and considers alone the fairer and more competent observers, the least pleasant of all the criticisms is that we are essentially a lawless people.

If the critic, like de Tocqueville and Miss Martineau, had sympathy and admiration for us, the revealed lawlessness came as an astonishment, because it seemed to upset all sorts of pretty theories about democracy. The doctrinaires had worked out to perfection the idea that a people who could freely make and unmake their own laws would, for that plain reason, respect the laws. Of course, a people who had laws thrust upon them from above would hate them and disobey them. But a democracy would escape this temptation.

It was apparently an amusement of many of these writers to collect, as did the jaunty author of "Peter Simple" in his Diary, interminable pages from our own press to illustrate the general contempt for those laws which really interfered with pleasures or economic interests. Harriet Martineau drove through Boston on the day when Garrison was being dragged through the streets. The flame of her indignation burned high; but it burned with new heat when she found that the very best of Boston culture and respectability would not lift a finger or pay a copper to have the law enforced in Mr. Garrison's favor. Beacon Street and Harvard professors told her that the victim was a disreputable agitator, richly deserving what he got. They seemed to think this English lady very cranky and unreasonable. The mob had the entire sympathy of the best people in the community, and that should satisfy her. De Tocqueville had an awakening at a polling-booth in Pennsylvania that in the same way disturbed all his presuppositions about us.

It is not my purpose to bristle up and strike back at these critics of American behavior. Amid possible exaggeration, they are telling a great deal of truth about us. It is a truth that it has its own natural history. A long adventurous border-life was in some respects the great fact of the nineteenth century in moulding our national habits. A large part of the population lived under conditions where no appeal to legal restraints was possible. There were no courts,--no police. The whole constructive work of life was thrown so absolutely upon the man fighting his life-battle alone, that excessive individualistic habits were formed. Every self-reliant instinct was developed until it became a law unto itself. They do not, says de Tocqueville of the Americans, ask help. They do not "appeal." They understand that everything rests with themselves. Every immigrant of those days had come from what Freeman calls "overgoverned" countries. They escaped from highly organized social constraints to have their fling on a continent as illimitable in extent as it was in the prizes which its natural resources offered. That such a large proportion of the strong lived this free border-life through the entire century has resulted in making a standard of individualistic action almost dominant in the community.

There is, first, this natural history of extreme individualistic habits and of their reactions on our whole national life. There is, further, the almost universal concentration on wealth-production as a means of winning what average men most crave in this world. What the strong of any race work for is not, ultimately, money, it is social power. This power has many symbols in a monarchy. There are titles and decorations for which armies of able men will do hard public service for years. This same passion is as lively in the United States as in Germany, but we exclude the symbols. Wealth everywhere gives power, but with us it is almost the only symbol that has wide and practical recognition. This passion, working in a vigorous people upon the resources which the United States offers, has intensified the competitive struggle in industry to a degree hitherto unknown in the world. This struggle has absorbed the thought and strength of the people to an extent without known parallel.

It is the magnitude and stress of this competition that have bent and subdued politics to business ends. The engendered business rivalries in this game develop qualities that are indifferent to laws.

The last ten years of investigation have disclosed one further reason for heedlessness of law. The chances of promotion among the abler and more ambitious young men in the service of large concerns are known to depend on the fact of a good showing in their departments. Can they keep down expenses? Can they enlarge and maintain sales? These have been the supreme tests for rapid and sure promotion. When these are done, few questions are asked by manager or director. Among the largest interests in this country, and among all interests that have to do with franchises and legislation, skill to evade laws may have the highest value in a fight against competitors. A magnate recently accused of law-breaking denies it roundly, and it may be with honesty. When the evidence of long-practiced frauds against the laws in his own business is produced, he insists that he never knew it. But he also turns on the light: "I do not ask my heads of departments how they succeed; it is enough for me that they do succeed." This explains, but does not excuse, the guilt.

I make no use here of theory. I am thinking of definite large business interests in which the evil will remain as common as it is inevitable so long as the business is unregulated and its shady practices concealed from public authorities and public opinion. In some of our huge concerns it is the traditional procedure to bring the various heads of departments together at regular intervals and pit them against each other as if running a race for life. What is the showing that each can make against the other? Has this one cut down the cost of his product; has he reduced this or that item of expenditure; has he got the most out of the workmen under his charge; has he been able to dodge practical difficulties--legal, sanitary, or any other--that stood in his way?

In this relentless contest before their superiors, the foreman or agent learns that the one key to favor and advancement is that no other shall make a better showing. If he can safely get this superior result out of his labor group, that is one way; if he can reach his end by introducing children under age, or by any other questionable device, the temptation is there in the subtlest form it can assume for the average man. When, recently, a swarm of sharp practices came out in another of the great concerns whose products reach half the homes of the nation, the man at the top doubtless told the truth when he replied: "In my position, it is not my business to know those details. I have no time except for the results sent in." Thus the president or director stands apart from and above this underworld of tolerated illegalities.

Here, then, are three reasons for lack of obedience to the law,--the long border struggle, the excessive concentration upon wealth-exploitation, and the ways through which successful subordinates are rewarded in severely competitive industries.

But another, weightier reason must now be added,--namely, our private monopolies with their influence and reactions on our whole community life. In the earlier and looser stages of development, when vast resources still remain unappropriated, private monopoly may aid a city or a nation. At first no public protection of fish and game is necessary, but the pressure of population will eventually compel a common rule to which the individual must submit. As surely as a growing town sooner or later requires a common water-supply, a common drainage, common sanitary provisions, and regulated hack charges, just so surely will the private monopoly somewhere and at some time require strict social control,--that is, control from the point of view of all of us and not from that of a few money-makers. A generation ago the stripping of our forests did not matter vitally. The interests that were to suffer from this stripping had not appeared. To-day a forestry policy derived absolutely from the common, social point of view has become a necessity so commanding that the nation's attention is at last caught. A generation ago no one had even guessed at the franchise-value of our streets,--not even those of New York city. After Jacob Sharp had made these values known, a struggle began which reads like an Arabian tale. It is a story of business and political corruption that has gone on in varying degrees in scores of our cities and in scores of great industries where strong men have been fighting to get control of mines, forests, lands, and oil, the development of which depended on favorable transportation. The carrying trade--whether of goods or people--is never to be omitted in this story. Until very recent years, this mother of monopolies, the railroad, was thought of as a purely private possession. A dozen years ago one of our ablest railroad lawyers (often before the United States Supreme Court with great cases) told me it had long been one of his intellectual amusements to try to force into the heads of railroad presidents the fact that their ownership of that kind of property was profoundly different from the ownership of a horse or a grocery store. "I finally," he said, "had to give it up." It meant nothing to them that society had given them stupendous privileges which qualified their ownership. These franchise-grants once in their pockets, everything that was built upon them came to be used in any conceivable game to enrich the owner.

Properly informed persons no longer discuss whether it is right and moral to allow railroad magnates to do as they like--to act as if these properties were strictly a private possession. We know, at last, how society has suffered from leaving this form of ownership so long without social control. We have seen the devastating conflict between unregulated possession of this kind of property and all the higher welfare of the community. If we add to the railway the common city monopolies of lighting and transportation; if we add industries in iron and steel, much of our mining, oil, and forest exploitation, all of which, in connection with railways, take on inevitably the form of monopoly, we have the whole buccaneer-group that has done upon our politics the deadly work, which we know so well that its retelling is a thing to avoid from very weariness.

Though a dozen other cities would serve as well, look for a moment at the monopoly of the New York street-railways. A people, careless and ignorant of their own interests, so far give away the rights in their streets, that a few men get them into their possession. With the grip once fast upon this power, it becomes not a machinery primarily to serve the people: primarily it becomes an enginery to filch vast unearned increments from the public. It becomes a device for gambling, with the dice so heavily loaded in your favor that you cannot lose. You change power from one kind to another; you merge one line with another or with the whole; you create holding companies; and at every change you recapitalize. Your million dollars is turned into five or ten or twenty millions, in order that multiplied dividends taken from the public may drop into private pockets. Every bit of bookkeeping meant for the public eye is a mass of jugglery. If you are frightened by the challenge of an indignant public, the most important records are destroyed. Surplus funds belonging to the stockholders are freely loaned to personal friends or put to private speculative ventures.