In addition, however, to these private gymnastics Lincoln shared with his neighbors a public and popular source of intellectual and human insight. The Western pioneers, for all their exclusive devotion to practical purposes, wasted a good deal of time on apparently useless social intercourse. In the Middle Western towns of that day there was, as we have seen, an extraordinary amount of good-fellowship, which was quite the most wholesome and humanizing thing which entered into the lines of these hard-working and hard-featured men. The whole male countryside was in its way a club; and when the presence of women did not make them awkward and sentimental, the men let themselves loose in an amount of rough pleasantry and free conversation, which added the one genial and liberating touch to their lives. This club life of his own people Lincoln enjoyed and shared much more than did his average neighbor. He pa.s.sed the greater part of what he would have called his leisure time in swapping with his friends stories, in which the genial and humorous side of Western life was embodied. Doubtless his domestic unhappiness had much to do with his vagrancy; but his native instinct for the wholesome and illuminating aspect of the life around him brought him more frequently than any other cause to the club of loafers in the general store. And whatever the promiscuous conversation and the racy yarns meant to his a.s.sociates, they meant vastly more to Lincoln. His hours of social vagrancy really completed the process of his intellectual training. It relieved his culture from the taint of bookishness. It gave substance to his humor. It humanized his wisdom and enabled him to express it in a familiar and dramatic form. It placed at his disposal, that is, the great cla.s.sic vehicle of popular expression, which is the parable and the spoken word.
Of course, it was just because he shared so completely the amus.e.m.e.nts and the occupations of his neighbors that his private personal culture had no embarra.s.sing effects. Neither he nor his neighbors were in the least aware that he had been placed thereby in a different intellectual cla.s.s. No doubt this loneliness and sadness of his personal life may be partly explained by a dumb sense of difference from his fellows; and no doubt this very loneliness and sadness intensified the mental preoccupation which was both the sign and the result of his personal culture. But his unconsciousness of his own distinction, as well as his regular partic.i.p.ation in political and professional practice, kept his will as firm and vigorous as if he were really no more than a man of action. His natural steadiness of purpose had been toughened in the beginning by the hardships and struggles which he shared with his neighbors; and his self-imposed intellectual discipline in no way impaired the stability of his character, because his personal culture never alienated him from his neighbors and threw him into a consciously critical frame of mind. The time which he spent in intellectual diversion may have diminished to some extent his practical efficiency previous to the gathering crisis. It certainly made him less inclined to the aggressive self-a.s.sertion which a successful political career demanded. But when the crisis came, when the minds of Northern patriots were stirred by the ugly alternative offered to them by the South, and when Lincoln was by the course of events restored to active partic.i.p.ation in politics, he soon showed that he had reached the highest of all objects of personal culture. While still remaining one of a body of men who, all unconsciously, impoverished their minds in order to increase the momentum of their practical energy, he none the less achieved for himself a mutually helpful relation between a firm will and a luminous intelligence. The training of his mind, the awakening of his imagination, the formation of his taste and style, the humorous dramatizing of his experience,--all this discipline had failed to pervert his character, narrow his sympathies, or undermine his purposes.
His intelligence served to enlighten his will, and his will, to establish the mature decisions of his intelligence. Late in life the two faculties became in their exercise almost indistinguishable. His judgments, in so far as they were decisive, were charged with momentum, and his actions were instinct with sympathy and understanding.
Just because his actions were instinct with sympathy and understanding, Lincoln was certainly the most humane statesman who ever guided a nation through a great crisis. He always regarded other men and acted towards them, not merely as the embodiment of an erroneous or harmful idea, but as human beings, capable of better things; and consequently all of his thoughts and actions looked in the direction of a higher level of human a.s.sociation. It is this characteristic which makes him a better and, be it hoped, a more prophetic democrat than any other national American leader. His peculiar distinction does not consist in the fact that he was a "Man of the People" who pa.s.sed from the condition of splitting rails to the condition of being President. No doubt he was in this respect as good a democrat as you please, and no doubt it was desirable that he should be this kind of a democrat. But many other Americans could be named who were also men of the people, and who pa.s.sed from the most insignificant to the most honored positions in American life. Lincoln"s peculiar and permanent distinction as a democrat will depend rather upon the fact that his thoughts and his actions looked towards the realization of the highest and most edifying democratic ideal. Whatever his theories were, he showed by his general outlook and behavior that democracy meant to him more than anything else the spirit and principle of brotherhood. He was the foremost to deny liberty to the South, and he had his sensible doubts about the equality between the negro and the white man; but he actually treated everybody--the Southern rebel, the negro slave, the Northern deserter, the personal enemy--in a just and kindly spirit. Neither was this kindliness merely an instance of ordinary American amiability and good nature. It was the result, not of superficial feeling which could be easily ruffled, but of his personal, moral, and intellectual discipline. He had made for himself a second nature, compact of insight and loving-kindness.
It must be remembered, also, that this higher humanity resided in a man who was the human instrument partly responsible for an awful amount of slaughter and human anguish. He was not only the commander-in-chief of a great army which fought a long and b.l.o.o.d.y war, but he was the statesman who had insisted that, if necessary, the war should be fought. His mental att.i.tude was dictated by a mixture of practical common sense with genuine human insight, and it is just this mixture which makes him so rare a man and, be it hoped, so prophetic a democrat. He could at one and the same moment order his countrymen to be killed for seeking to destroy the American nation and forgive them for their error. His kindliness and his brotherly feeling did not lead him, after the manner of Jefferson, to shirk the necessity and duty of national defense.
Neither did it lead him, after the manner of William Lloyd Garrison, to advocate non-resistance, while at the same time arousing in his fellow-countrymen a spirit of fratricidal warfare. In the midst of that hideous civil contest which was provoked, perhaps unnecessarily, by hatred, irresponsibility, pa.s.sion, and disloyalty, and which has been the fruitful cause of national disloyalty down to the present day, Lincoln did not for a moment cherish a bitter or unjust feeling against the national enemies. The Southerners, filled as they were with a pa.s.sionate democratic devotion to their own interests and liberties, abused Lincoln until they really came to believe that he was a military tyrant, yet he never failed to treat them in a fair and forgiving spirit. When he was a.s.sa.s.sinated, it was the South, as well as the American nation, which had lost its best friend, because he alone among the Republican leaders had the wisdom to see that the divided House could only be restored by justice and kindness; and if there are any defects in its restoration to-day, they are chiefly due to the baleful spirit of injustice and hatred which the Republicans took over from the Abolitionists.
His superiority to his political a.s.sociates in constructive statesmanship is measured by his superiority in personal character.
There are many men who are able to forgive the enemies of their country, but there are few who can forgive their personal enemies. I need not rehea.r.s.e the well-known instances of Lincoln"s magnanimity. He not only cherished no resentment against men who had intentionally and even maliciously injured him, but he seems at times to have gone out of his way to do them a service. This is, perhaps, his greatest distinction.
Lincoln"s magnanimity is the final proof of the completeness of his self-discipline. The quality of being magnanimous is both the consummate virtue and the one which is least natural. It was certainly far from being natural among Lincoln"s own people. Americans of his time were generally of the opinion that it was dishonorable to overlook a personal injury. They considered it weak and unmanly not to quarrel with another man a little harder than he quarreled with you. The pioneer was good-natured and kindly; but he was aggressive, quick-tempered, unreasonable, and utterly devoid of personal discipline. A slight or an insult to his personality became in his eyes a moral wrong which must be cherished and avenged, and which relieved him of any obligation to be just or kind to his enemy. Many conspicuous ill.u.s.trations of this quarrelsome spirit are to be found in the political life of the Middle Period, which, indeed, cannot be understood without constantly falling back upon the influence of lively personal resentments. Every prominent politician cordially disliked or hated a certain number of his political adversaries and a.s.sociates; and his public actions were often dictated by a purpose either to injure these men or to get ahead of them. After the retirement of Jackson these enmities and resentments came to have a smaller influence; but a man"s right and duty to quarrel with anybody who, in his opinion, had done him an injury was unchallenged, and was generally considered to be the necessary accompaniment of American democratic virility.
As I have intimated above, Andrew Jackson was the most conspicuous example of this quarrelsome spirit, and for this reason he is wholly inferior to Lincoln as a type of democratic manhood. Jackson had many admirable qualities, and on the whole he served his country well. He also was a "Man of the People" who understood and represented the ma.s.s of his fellow-countrymen, and who played the part, according to his lights, of a courageous and independent political leader. He also loved and defended the Union. But with all his excellence he should never be held up as a model to American youth. The world was divided into his personal friends and followers and his personal enemies, and he was as eager to do the latter an injury as he was to do the former a service.
His quarrels were not petty, because Jackson was, on the whole, a big rather than a little man, but they were fierce and they were for the most part irreconcilable. They bulk so large in his life that they cannot be overlooked. They stamp him a type of the vindictive man without personal discipline, just as Lincoln"s behavior towards Stanton, Chase, and others stamps him a type of the man who has achieved magnanimity. He is the kind of national hero the admiring imitation of whom can do nothing but good.
Lincoln had abandoned the illusion of his own peculiar personal importance. He had become profoundly and sincerely humble, and his humility was as far as possible from being either a conventional pose or a matter of nervous self-distrust. It did not impair the firmness of his will. It did not betray him into shirking responsibilities. Although only a country lawyer without executive experience, he did not flinch from a.s.suming the leadership of a great nation in one of the gravest crises of its national history, from becoming commander-in-chief of an army of a million men, and from spending $3,000,000,000 in the prosecution of a war. His humility, that is, was precisely an example of moral vitality and insight rather than of moral awkwardness and enfeeblement. It was the fruit of reflection on his own personal experience--the supreme instance of his ability to attain moral truth both in discipline and in idea; and in its aspect of a moral truth it obtained a more explicit expression than did some other of his finer personal attributes. His practice of cherishing and repeating the plaintive little verses which inquire monotonously whether the spirit of mortal has any right to be proud indicates the depth and the highly conscious character of this fundamental moral conviction. He is not only humble himself, but he feels and declares that men have no right to be anything but humble; and he thereby enters into possession of the most fruitful and the most universal of all religious ideas.
Lincoln"s humility, no less than his liberal intelligence and his magnanimous disposition, is more democratic than it is American; but in this, as in so many other cases, his personal moral dignity and his peculiar moral insight did not separate him from his a.s.sociates. Like them, he wanted professional success, public office, and the ordinary rewards of American life; and like them, he bears no trace of political or moral purism. But, unlike them, he was not the intellectual and moral victim of his own purposes and ambitions; and unlike them, his life is a tribute to the sincerity and depth of his moral insight. He could never have become a national leader by the ordinary road of insistent and clamorous self-a.s.sertion. Had he not been restored to public life by the crisis, he would have remained in all probability a comparatively obscure and a wholly under-valued man. But the political ferment of 1856 and the threat of ruin overhanging the American Union pushed him again on to the political highway; and once there, his years of intellectual discipline enabled him to play a leading and a decisive part. His personality obtained momentum, direction, and increasing dignity from its identification with great issues and events. He became the individual instrument whereby an essential and salutary national purpose was fulfilled; and the instrument was admirably effective, precisely because it had been silently and unconsciously tempered and formed for high achievement. Issue as he was of a society in which the cheap tool, whether mechanical or personal, was the immediately successful tool, he had none the less labored long in the making of a consummate individual instrument.
Some of my readers may protest that I have over-emphasized the difference between Lincoln and his contemporary fellow-countrymen. In order to exalt the leader have I not too much disparaged the followers?
Well, a comparison of this kind always involves the risk of unfairness; but if there is much truth in the foregoing estimate of Lincoln, the lessons of the comparison are worth its inevitable risk. The ordinary interpretation of Lincoln as a consummate democrat and a "Man of the People" has implied that he was, like Jackson, simply a bigger and a better version of the plain American citizen; and it is just this interpretation which I have sought to deny and to expose. In many respects he was, of course, very much like his neighbors and a.s.sociates.
He accepted everything wholesome and useful in their life and behavior.
He shared their good-fellowship, their strength of will, their excellent faith, and above all their innocence; and he could never have served his country so well, or reached as high a level of personal dignity, in case he had not been good-natured and strong and innocent. But, as all commentators have noted, he was not only good-natured, strong and innocent; he had made himself intellectually candid, concentrated, and disinterested, and morally humane, magnanimous, and humble. All these qualities, which were the very flower of his personal life, were not possessed either by the average or the exceptional American of his day; and not only were they not possessed, but they were either wholly ignored or consciously under-valued. Yet these very qualities of high intelligence, humanity, magnanimity and humility are precisely the qualities which Americans, in order to become better democrats, should add to their strength, their h.o.m.ogeneity, and their innocence; while at the same time they are just the qualities which Americans are prevented by their individualistic practice and tradition from attaining or properly valuing. Their deepest convictions make the average unintelligent man the representative democrat, and the aggressive successful individual, the admirable national type; and in conformity with these convictions their uppermost ideas in respect to Lincoln are that he was a "Man of the People" and an example of strong will. He was both of these things, but his great distinction is that he was also something vastly more and better. He cannot be fully understood and properly valued as a national hero without an implicit criticism of those traditional convictions. Such a criticism he himself did not and could not make. In case he had made it, he could never have achieved his great political task and his great personal triumph. But other times bring other needs. It is as desirable to-day that the criticism should be made explicit as it was that Lincoln himself in his day should preserve the innocence and integrity of a unique unconscious example.
CHAPTER V
I
THE CONTEMPORARY SITUATION AND ITS PROBLEMS
It is important to recognize that the anti-slavery agitation, the secession of the South, and the Civil War were, after all, only an episode in the course of American national development. The episode was desperately serious. Like the acute illness of a strong man, it almost killed its victim; and the crisis exposed certain weaknesses in our political organism, in the absence of which the illness would never have become acute. But the roots of our national vitality were apparently untouched by the disease. When the crisis was over, the country resumed with astonishing celerity the interrupted process of economic expansion.
The germs of a severe disease, to which the Fathers of the Republic had given a place in the national Const.i.tution, and which had been allowed to flourish, because of the lack of wholesome cohesion in the body politic--this alien growth had been cut out by a drastic surgical operation, and the robust patient soon recovered something like his normal health. Indeed, being in his own opinion even more robust than he was before the crisis, he was more eager than ever to convert his good health into the gold of satisfied desire. The ghost of slavery had been banished from our national banquet: and, relieved of this terror, the American people began to show, more aggressively than ever before, their ability to provide and to consume a bountiful feast. They were no longer children, grasping at the first fruits of a half-cultivated wilderness.
They were adults, beginning to plan the satisfaction of on appet.i.te which had been sharpened by self-denial, and made self-conscious by maturity.
The North, after the war was over, did not have much time for serious reflection upon its meaning and consequences. The Republican leaders did just enough thinking to carry them through the crisis; but once the rebellion was suppressed and the South partly de-nationalized in the name of reconstruction, the need and desire was for action rather than for thought. The anti-slavery agitation and the war had interrupted the process, which from the public point of view, was described as the economic development of the country, and which from an individual standpoint meant the making of money. For many years Americans had been unable, because of the ghost of slavery, to take full advantage of their liberties and opportunities; and now that the specter was exorcised, they gladly put aside any anxious political preoccupations. Politics could be left to the politicians. It was about time to get down to business. In this happiest of all countries, and under this best of all governments, which had been preserved at such an awful cost, the good American was ent.i.tled to give his undivided attention to the great work of molding and equipping the continent for human habitation, and incidentally to the minor task of securing his share of the rewards. A lively, even a frenzied, outburst of industrial, commercial, and speculative activity followed hard upon the restoration of peace. This activity and its effects have been the most important fact in American life during the forty years which have supervened; and it has a.s.sumed very different characteristics from those which it had a.s.sumed previous to the War. We must now consider the circ.u.mstances, the consequences, and the meaning of this economic revolution.
Although n.o.body in 1870 suspected it, the United States was entering upon a new phase of its economic career; and the new economy was bringing with it radical social changes. Even before the outbreak of the Civil War the rich and fertile states of the Middle West had become well populated. They had pa.s.sed from an almost exclusively agricultural economy to one which was much more largely urban and industrial. The farms had become well-equipped; large cities were being built up; factories of various kinds were being established; and most important of all, the whole industrial organization of the country was being adjusted to transportation by means of the railroad. An industrial community, which was, comparatively speaking, well-organized and well-furnished with machinery, was taking the place of the agricultural community of 1830-1840, which was incoherent and scattered and which lacked everything except energy and opportunity. Such an increase of organization, capital, and equipment necessarily modified the outlook and interests of the people of the Middle West. While still retaining many of their local traits, their point of view had been approaching in certain respects that of the inhabitants of the East. They had ceased to be pioneers.
During the two decades after the Civil War, the territory, which was still in the early stage of agricultural development, was the first and second tier of states west of the Mississippi River. Missouri, Iowa, and Minnesota, Kansas, Nebraska, and finally the Dakotas were being opened for settlement; but in their case the effect and symptoms of this condition were not the same as they had been with the earlier pioneer states. Their economy was from the beginning adjusted to the railroad; and the railroad had made an essential difference. It worked in favor of a more comprehensive and definite organization and a more complete equipment. While the business interests of the new states were and still are predominantly agricultural, the railroads had transformed the occupation of farming. After 1870, the pioneer farmer was much less dependent than he had been upon local conditions and markets, and upon the unaided exertions of himself and his neighbors. He bought and sold in the markets of the world. He needed more capital and more machinery.
He had to borrow money and make shrewd business calculations. From every standpoint his economic environment had become more complicated and more extended, and his success depended much more upon conditions which were beyond his control. He never was a pioneer in the sense that the early inhabitants of the Middle West and South had been pioneers; and he has never exercised any corresponding influence upon the American national temper. The pioneer had enjoyed his day, and his day was over. The Jack-of-all-trades no longer possessed an important economic function.
The average farmer was, of course, still obliged to be many kinds of a rough mechanic, but for the most part he was nothing more than a farmer.
Unskilled labor began to mean labor which was insignificant and badly paid. Industrial economy demanded the expert with his high and special standards of achievement. The railroads and factories could not be financed and operated without the a.s.sistance of well-paid and well-trained men, who could do one or two things remarkably well, and who did not pretend to do much of anything else. These men had to retain great flexibility and an easy adaptability of intelligence, because American industry and commerce remained very quick in its movements. The machinery which they handled was less permanent, and was intended to be less permanent than the machinery which was considered economical in Europe. But although they had to avoid routine and business rigidity on the penalty of utter failure, still they belonged essentially to a cla.s.s of experts. Like all experts, they had to depend, not upon mere energy, untutored enthusiasm, and good-will, but upon careful training and single-minded devotion to a special task, and at the same time proper provision had to be made for coordinating the results of this highly specialized work. More complete organization necessarily accompanied specialization. The expert became a part of a great industrial machine.
His individuality tended to disappear in his work. His interests became those of a group. Imperative economic necessities began to cla.s.sify the individuals composing American society in the same way, if not to the same extent, that they had been cla.s.sified in Europe.
This was a result which had never entered into the calculations of the pioneer Democrat. He had disliked specialization, because, as he thought, it narrowed and impoverished the individual; and he distrusted permanent and official forms of organization, because, as he thought, they hampered the individual. His whole political, social, and economic outlook embodied a society of energetic, optimistic, and prosperous democrats, united by much the same interests, occupations, and point of view. Each of these democrats was to be essentially an all-round man.
His conception of all-round manhood was somewhat limited; but it meant at least a person who was expansive in feeling, who was enough of a business man successfully to pursue his own interests, and enough of a politician to prevent any infringement or perversion of his rights. He never doubted that the desired combination of business man, politician, and good fellow const.i.tuted an excellent ideal of democratic individuality, that it was sufficiently realized in the average Western American of the Jacksonian epoch, that it would continue to be the type of admirable manhood, and that the good democrats embodying this type would continue to merit and to obtain substantial and approximately equal pecuniary rewards. Moreover, for a long time the vision remained sufficiently true. The typical American democrat described by De Tocqueville corresponded very well with the vision of the pioneer; and he did not disappear during the succeeding generation. For many years millions of Americans of much the same pattern were rewarded for their democratic virtue in an approximately similar manner. Of course some people were poor, and some people were rich; but there was no cla.s.s of the very rich, and the poverty of the poor was generally their own fault. Opportunity knocked at the door of every man, and the poor man of to-day was the prosperous householder of to-morrow. For a long time American social and economic conditions were not merely fluid, but consistent and h.o.m.ogeneous, and the vision of the pioneer was fulfilled.
Nevertheless, this condition was essentially transient. It contained within itself the seeds of its own dissolution and transformation; and this transformation made headway just as soon as, and just as far as, economic conditions began to prefer the man who was capable of specializing his work, and of organizing it with the work of his fellows.
The dominant note, consequently, of the pioneer period was an unformed national consistency, reached by means of a natural community of feeling and a general similarity of occupation and well-being. On the other hand, the dominant note of the period from 1870 until the present day has been the gradual disintegration of this early national consistency, brought about by economic forces making for specialization and organization in all practical affairs, for social cla.s.sification, and finally for greater individual distinction. Moreover, the tendency towards specialization first began to undermine the very corner-stone of the pioneer"s democratic edifice. If private interest and public weal were to be as harmonious as the pioneer a.s.sumed, every economic producer must be a practical politician, and there must be no deep-lying division between these primary activities. But the very first result of the specializing tendency was to send the man of business, the politician, and the lawyer off on separate tacks. Business interests became so absorbing that they demanded all of a man"s time and energy; and he was obliged to neglect politics except in so far as politics affected business. In this same way, the successful lawyers after the War were less apt than formerly to become politicians and statesmen. They left public affairs largely to the unsuccessful lawyers. Politics itself became an occupation which made very exacting demands upon a man"s time and upon his conscience. Public service or military success were no longer the best roads to public distinction. Men became renowned and distinguished quite as much, if not more, for achievements in their private and special occupations. Along with leadership of statesmen and generals, the American people began to recognize that of financiers, "captains of industry," corporation lawyers, political and labor "bosses," and these gentlemen a.s.sumed extremely important parts in the direction of American affairs. Officially, the new leaders were just like any other American citizen. No t.i.tles could be conferred upon them, and their position brought with it no necessary public responsibilities.
Actually, however, they exercised in many cases more influence upon American social and political economy than did the official leaders.
They were an intrusion, into the traditional economic political and social system, for which no provision had been made. Their special interests, and the necessities of their special tasks, made their manner of life different from that of other American citizens, and their peculiar opportunities enabled them to appropriate an unusually large share of the fruits of American economic development. Thus they seriously impaired the social and economic h.o.m.ogeneity, which the pioneer believed to be the essential quality of fruitful Americanism.
II
THE DEVELOPMENT OF THE BUSINESS SPECIALIST
Before seeking to trace the consequences and the significance of this specialized organization of American practical affairs, we must examine its origin with some care. An exact and complete understanding thereof will in itself afford an unmistakable hint of the way in which its consequences are to be appraised, and wherever necessary, corrected. The great and increasing influence of the new unofficial leaders has been due not only to economic conditions and to individual initiative, but to the nature of our political ideas and inst.i.tutions. The traditional American theory was that the individual should have a free hand. In so far as he was subject to public regulation and control such control should be exercised by local authorities, whereof the result would be a happy combination of individual prosperity and public weal. But this expectation, as we have seen, has proved to be erroneous. While it has, indeed, resulted in individual prosperity, the individual who has reaped most of the prosperity is not the average, but the special man; and however the public may have benefited from the process, the benefit is mixed with so many drawbacks that, even if it may not be wholly condemned, it certainly cannot be wholly approved. The plain fact is that the individual in freely and energetically pursuing his own private purposes has not been the inevitable public benefactor a.s.sumed by the traditional American interpretation of democracy. No doubt he has incidentally accomplished, in the pursuit of his own aggrandizement, certain manifest public benefits; but wherever public and private advantages have conflicted, he has naturally preferred the latter. And under our traditional political system there was, until recently, no effective way of correcting his preference.
As long as the economic opportunities of American life consisted chiefly in the appropriation and improvement of uncultivated land, the average energetic man had no difficulty in obtaining his fair share of the increasing American economic product; but the time came when such opportunities, although still important, were dwarfed by other opportunities, incident to the development of a more mature economic system. These opportunities, which were, of course, connected with the manufacturing, industrial, and technical development of the country, demanded under American conditions a very special type of man--the man who would bring to his task not merely energy, but unscrupulous devotion, originality, daring, and in the course of time a large fund of instructive experience. The early American industrial conditions differed from those of Europe in that they were fluid, and as a result of this instability, extremely precarious. Rapid changes in markets, business methods, and industrial machinery made it very difficult to build up a safe business. A manufacturer or a merchant could not secure his business salvation, as in Europe, merely by the adoption of sound conservative methods. The American business man had greater opportunities and a freer hand than his European prototype; but he was also beset by more severe, more unscrupulous, and more dangerous compet.i.tion. The industrious and thrifty farmer could be tolerably sure of a modest competence, due partly to his own efforts, and partly to the increased value of his land in a more populous community; but the business man had no such security. In his case it was war to the knife.
He was presented with a choice between aggressive daring business operations, and financial insignificance or ruin.
No doubt this situation was due as much to the temper of the American business man as to his economic environment. American energy had been consecrated to economic development. The business man in seeking to realize his ambitions and purposes was checked neither by government control nor social custom. He had nothing to do and nothing to consider except his own business advancement and success. He was eager, strenuous, and impatient. He liked the excitement and the risk of large operations. The capital at his command was generally too small for the safe and conservative conduct of his business; and he was consequently obliged to be adventurous, or else to be left behind in the race. He might well be earning enormous profits one year and skirting bankruptcy the next. Under such a stress conservatism and caution were suicidal. It was the instinct of self-preservation, as well as the spirit of business adventure, which kept him constantly seeking for larger markets, improved methods, or for some peculiar means of getting ahead of his compet.i.tors. He had no fortress behind which he could hide and enjoy his conquests. Surrounded as he was by aggressive enemies and undefended frontiers, his best means of security lay in a policy of constant innovation and expansion. Moreover, even after he had obtained the bulwark of sufficient capital and more settled industrial surroundings, he was under no temptation to quit and enjoy the spoils of his conquests. The social, intellectual, or even the more vulgar pleasures, afforded by leisure and wealth, could bring him no thrill, which was anything like as intense as that derived from the exercise of his business ability and power. He could not conquer except by virtue of a strong, tenacious, adventurous, and unscrupulous will; and after he had conquered, this will had him in complete possession. He had nothing to do but to play the game to the end--even though his additional profits were of no living use to him.
If, however, the fluid and fluctuating nature of American economic conditions and the fierceness of American compet.i.tive methods turned business into a state of dangerous and aggressive warfare, the steady and enormous expansion of the American markets made the rewards of victory correspondingly great. Not only was the population of the country increasing at an enormous rate, but the demand for certain necessary products, services, and commodities was increasing at a higher rate than the population. The American people were still a most h.o.m.ogeneous collection of human beings. They wanted very much the same things; they wanted more of these things year after year; and they immediately rewarded any cheapening of the product by buying it in much larger quant.i.ties. The great business opportunities of American life consisted, consequently, in supplying some popular or necessary article or service at a cheaper price than that at which any one else could furnish it; and the great effort of American business men was, of course, to obtain some advantage over their compet.i.tors in producing such an article or in supplying such a service. The best result of this condition was a constant improvement in the mechanism of production.
Cheapness was found to depend largely upon the efficient use of machinery, and the efficient use of machinery was found to depend upon constant wear and quick replacement by a better machine. But while the economic advantage of the exhausting use and the constant improvement of machinery was the most important economic discovery of the American business man, he was also encouraged by his surroundings to seek economies in other and less legitimate ways. It was all very well to multiply machines and make them more efficient, but similar improvements were open to compet.i.tors. The great object was to obtain some advantage which was denied to your compet.i.tors. Then the business man could not only secure his own position, but utterly rout and annihilate his adversaries.
At this point the railroads came to the a.s.sistance of the aggressive and unscrupulous business man. They gave such men an advantage over their compet.i.tors by granting them special rates; and inasmuch as this practice has played a decisive part in American business development, its effect and its meaning, frequently as they have been pointed out, must be carefully traced.
The railroads themselves are, perhaps, the most perfect ill.u.s.tration of the profits which accrue in a rapidly growing country from the possession of certain advantages in supplying to the public an indispensable service. They were not built, as in most European states, under national supervision and regulation, or according to a general plan which prevented unnecessary compet.i.tion. Their routes and their methods were due almost entirely to private enterprise and to local economic necessities. They originated in local lines radiating from large cities; and only very slowly did their organization come to correspond with the great national routes of trade. The process of building up the leading systems was in the beginning a process of combining the local roads into important trunk lines. Such combinations were enormously profitable, because the business of the consolidated roads increased in a much larger proportion than did the cost of financing end operating the larger mileage; and after the combinations were made the owners of the consolidated road were precisely in the position of men who had obtained a certain strategic advantage in supplying a necessary service to their fellow-countrymen. Their terminals, rights of way, and machinery could not be duplicated except at an increased cost, and their owners were in a position necessarily to benefit from the growth of the country in industry and population. No doubt their economic position was in certain respects precarious. They did not escape the necessity, to which other American business enterprises had to submit, of fighting for a sufficient share of the spoils. But in making the fight, they had acquired certain advantages which, if they were intelligently used, would necessarily result in victory; and as we all know, these advantages have proved to be sufficient. The railroads have been the greatest single source of large American fortunes, and the men who control the large railroad systems are the most powerful and conspicuous American industrial leaders.
Important, however, as has been the direct effect of big railroad systems on the industrial economy of the country, their indirect effects have probably been even more important. In one way or another, they have been the most effective of all agencies working for the larger organization of American industries. Probably such an organization was bound to have come in any event, because the standard economic needs of millions of thrifty democrats could in the long run be most cheaply satisfied by means of well-situated and fully equipped industrial plants of the largest size; but the railroad both hastened this result and determined its peculiar character. The population of the United States is so scattered, its distances so huge, and its variations in topographical level so great, that its industries would necessarily have remained very local in character, as long as its system of transportation depended chiefly upon waterways and highways. Some kind of quick transportation across country was, consequently, an indispensable condition of the national organization of American industry and commerce. The railroad not only supplied this need, but coming as it did pretty much at the beginning of our industrial development, it largely modified and determined the character thereof.
By considerably increasing the area within which the products of any one locality could be profitably sold, it worked naturally in favor of the concentration of a few large factories in peculiarly favorable locations; and this natural process was accelerated by the policy which the larger companies adopted in the making of their rates. The rapid growth of big producing establishments was forced, because of the rebates granted to them by the railroads. Without such rebates the large manufacturing corporation controlled by a few individuals might still have come into existence; but these individuals would have been neither as powerful as they now are, nor as opulent, nor as much subject to suspicion.
It is peculiarly desirable to understand, consequently, just how these rebates came to be granted. It was, apparently, contrary to the interest of the railroad companies to cut their rates for the benefit of any one cla.s.s of customers; and it was, also, an illegal practice, which had to be carried on by secret and underhand methods. Almost all the state laws under which corporations engaged in transportation had been organized, had defined railways, like highways, as public necessities. Such corporations had usually been granted by the states the power to condemn land,--and the delegation of such a power to a private company meant, of course, that it owed certain responsibilities to the public as a common carrier, among which the responsibility of not allowing special privileges to any one customer was manifestly to be included. When the railroad managers have been asked why they cut their published rates and evaded the laws, they have always contended that they were forced to do so; and whatever may be thought of the plea, it cannot be lightly set aside. As we have seen, the trunk lines leading from Chicago to the coast were the result of the consolidation of local roads. After the consolidations had taken place, these companies began to compete fiercely for through freight, and the rebates were an incident in this compet.i.tion. The trunk lines in the early years of their existence were in the position of many other American business enterprises. For the time being, they were more than competent to carry all the freight offered at compet.i.tive points. Inasmuch as there was not enough to go around, they fought mercilessly for what business there was. When a large individual shipper was prepared to guarantee them a certain amount of freight in return for special rates, they were obliged either to grant the rates or to lose the business. Of course they submitted, and defended their submission as a measure of self-preservation.
No great intelligence is required to detect in this situation the evidence of a vicious circle. The absorption of Americans in business affairs, and the free hand which the structure and ideals of American life granted them, had made business compet.i.tion a fierce and merciless affair; while at the same time the fluid nature of American economic conditions made success very precarious. Every shrewd and resolute man would seek to secure himself against the dangers of this situation by means of special advantages, and the most effective of all special advantages would, of course, be special railroad rates. But a shipper such as John D. Rockefeller could obtain special rates only because the railroads were in a position similar to his own, and were fighting strenuously for supremacy. The favored shipper and the railroad both excused themselves on the ground of self-preservation, and sometimes even claimed that it was just for a large shipper to obtain better rates than a small one. This was all very well for the larger shipper and the railroad, but in the meantime what became of the small shipper, whom Mr.
Rockefeller was enabled to annihilate by means of his contracts with the railroad companies? The small shipper saw himself forced out of business, because corporations to whom the state had granted special privileges as common carriers, had a private interest in doing business with his bigger, more daring, and unscrupulous compet.i.tors.
Of course no such result could have happened, if at any point in this vicious circle of private interests, there had been a.s.serted a dominant public interest; and there are several points at which such an interest might well have been intruded. The circle would have been broken, if, for instance, the granting of illegal rebates had been effectively prohibited; but as a matter of fact they could not be effectively prohibited by the public authorities, to whom either the railroads or the large shippers were technically responsible. A shipper of oil in Cleveland, Ohio, would have a difficult time in protesting against illegal discrimination on the part of a railroad conducting an inter-state business and organized under the laws of New York. No doubt he could appeal to the Federal government; but the Federal government had been, for the time being, disqualified by many different causes from effective interference. In the first place there was to be overcome the conventional democratic prejudice against what was called centralization. A tradition of local control over the machinery of transit and transportation was dominant during the early period of railroad construction. The fact that railways would finally become the all-important vehicles of inter-state commerce was either overlooked or considered unimportant. The general government did not interfere--except when, as in the case of the Pacific lines, its interference and a.s.sistance were solicited by private interests. For a long time the idea that the Federal government had any general responsibility in respect to the national transportation system was devoid of practical consequences.
In the end an Inter-state Commerce law was pa.s.sed, in which the presence of a national interest in respect to the American system of transportation was recognized. But this law, like our tariff laws, was framed for the benefit chiefly of a combination of local and special interests; and it served little to advance any genuine national interest in relation to the railroads. To be sure it did forbid rebates, but the machinery for enforcing the prohibition was inefficient, and during another twenty years the prohibition remained substantially a dead letter. The provisions of the law forbidding rebates were in truth merely a bit of legal hypocrisy. Rebates could not be openly defended; but the business of the country was honeycombed with them, and the majority of the shippers in whose interest the law was pa.s.sed did not want the prohibition enforced. Their influence at Washington was sufficiently powerful to prevent the adoption of any effective measures for the abatement of the evil. The Federal Inter-state Commerce Commission, unlike the local authorities, would have been fully competent to abolish rebates; but the plain truth was that the effective public opinion in the business world either supported the evil or connived at it. The private interests at stake were, for the time being, too strong for the public interest. The whole American business tradition was opposed to government interference with prevailing business practices; and in view of this fact the responsibility for the rebates cannot be fixed merely upon the railroads and the trusts. The American system had licensed energetic and unscrupulous individual aggrandizement as the best means of securing a public benefit; and rebates were merely a flagrant instance of the extent to which public opinion permitted the domination of private interests.
The failure of the Federal government to protect the public interest in a matter over which the state governments had no effective control, has greatly accelerated the organization of American industries on a national scale, but for private and special purposes. Certain individuals controlling certain corporations were enabled to obtain a decided advantage in supplying certain services and products to the enormously increasing American market; and once those individuals and corporations had obtained dominant positions, it was in their interest to strengthen one another"s hands in every possible way. One big corporation has as a rule preferred to do business with another big corporation. They were all of them producing some standard commodity or service, and it is part of the economical conduct of such businesses to buy and sell so far as possible in large quant.i.ties and under long contracts. Such contracts reduced to a comparatively low level the necessary uncertainties of business. It enabled the managers of these corporations to count upon a certain market for their product or a certain cost for part of their raw material; and it must be remembered that the chief object of this whole work of industrial organization was to diminish the hazards of unregulated compet.i.tion and to subject large business operations to effective control. A conspicuous instance of the effect of such interests and motives may be seen in the lease of the ore lands belonging to the Great Northern Railroad to the United States Steel Corporation. The railroad company owned the largest body of good ore in the country outside of the control of the Steel Corporation, and if these lands had been leased to many small companies, the ability of the independent steel manufacturers to compete with the big steel company would have been very much increased. But the Great Northern Railroad Company found it simpler and more secure to do business with one large than a number of small companies; and in this way the Steel Corporation has obtained almost a monopoly of the raw material most necessary to the production of finished steel. It will be understood, consequently, how inevitably these big corporations strengthen one another"s hands; and it must be added that they had political as well as economic motives for so doing. Although the big fellows sometimes indulge in the luxury of fierce fighting, such fights are always the prelude to still closer agreements. They are all embarked in the same boat; and surrounded as they are by an increasing amount of enmity, provoked by their aggrandizement, they have every reason to lend one another constant and effective support.
There may be discerned in this peculiar organization of American industry an entangling alliance between a wholesome and a baleful tendency. The purpose which prompted men like John D. Rockefeller to escape from the savage warfare in which so many American business men were engaged, was in itself a justifiable and ameliorating purpose.
Compet.i.tion in American business was insufficiently moderated either by the state or by the prevailing temper of American life. No sensible and resourceful man will submit to such a precarious existence without making some attempt to escape from it; and if the means which Mr.
Rockefeller and others took to secure themselves served to make the business lives of their compet.i.tors still more precarious, such a result was only the expiation which American business men were obliged to pay for their own excesses. The concentrated leadership, the partial control, the thorough organization thereby effected, was not necessarily a bad thing. It was in some respects a decidedly good thing, because leadership of any kind has certain intrinsic advantages. The trusts have certainly succeeded in reducing the amount of waste which was necessitated by the earlier condition of wholly unregulated compet.i.tion.
The compet.i.tive methods of nature have been, and still are, within limits indispensable; but the whole effort of civilization has been to reduce the area within which they are desirably effective; and it is entirely possible that in the end the American system of industrial organization will const.i.tute a genuine advance in industrial economy.
Large corporations, which can afford the best machinery; which control abundant capital, and which can plan with scrupulous economy all the details of producing and selling an important product or service, are actually able to reduce the cost of production to a minimum; and in the cases of certain American corporations such results have actually been achieved. The new organization of American industry has created an economic mechanism which is capable of being wonderfully and indefinitely serviceable to the American people.
On the other hand, its serviceability is much diminished by the special opportunities it gives a few individuals. These opportunities do not amount in any case to a monopoly, but they do amount to a species of economic privilege which enable them to wring profits from the increasing American market disproportionate to the value of their economic services. What is still more unfortunate, however, is the equivocal position of these big corporations in respect to the laws under which they are organized, and in respect to the public authorities which are supposed to control them. Many of the large railway and industrial corporations have reached their present size partly by an evasion or a defiance of the law. Their organizers took advantage of the American system of local self-government and the American disposition to reduce the functions of the Federal government to a minimum--they took advantage of these legal conditions and political ideas to organize an industrial machinery which cannot be effectively reached by local statutes and officials. The favorable corporation laws of some states have been used as a means of preying upon the whole country; and the unfavorable corporation laws of other states have been practically nullified. The big corporations have proved to be too big and powerful for the laws and officials to which the American political system has subjected them; and their equivocal legal position has resulted in the corruption of American public life and in the serious deterioration of our system of local government.
The net result of the industrial expansion of the United States since the Civil War has been the establishment in the heart of the American economic and social system of certain glaring inequalities of condition and power. The greater American railroad and industrial corporations control resources and conduct operations on a scale unprecedented in the economic history of the world. The great American industrial leaders have acc.u.mulated fortunes for which there is also no precedent on the part of men who exercise no official political power. These inequalities are the result of the organization of American industry on almost a national scale,--an organization which was brought about as a means of escape from the intolerable evils of unregulated compet.i.tion. Every aspect of American business methods has helped to make them inevitable, and the responsibility for them must be distributed over the whole business and social fabric. But in spite of the fact that they have originated as the inevitable result of American business methods and political ideas and inst.i.tutions, they const.i.tute a serious problem for a democracy to face; and this problem has many different aspects. Its most serious aspect is const.i.tuted by the sheer size of the resulting inequalities. The rich men and the big corporations have become too wealthy and powerful for their official standing in American life. They have not obeyed the laws. They have attempted to control the official makers, administrators, and expounders of the law. They have done little to allay and much to excite the resentment and suspicion. In short, while their work has been constructive from an economic and industrial standpoint, it has made for political corruption and social disintegration. Children, as they are, of the traditional American individualistic inst.i.tutions, ideas, and practices, they have turned on their parents and dealt them an ugly wound. Either these economic monsters will destroy the system of ideas, inst.i.tutions, and practices out of which they have issued or else be destroyed by them.