FOOTNOTES:[41]Speech in the Senate, June 20, 1832. Works Colvin Colton, ed. New York, Putnam's, 1904, vol. 7, p. 503.[42]Ibid., p. 503.[43]"Speeches," E. P. Whipple, ed. Little, Brown & Co., 1910, pp. 59-60.[44]"The Constitutional Position of Property in America," Arthur T. Hadley,Independent, April 16, 1908.
[41]Speech in the Senate, June 20, 1832. Works Colvin Colton, ed. New York, Putnam's, 1904, vol. 7, p. 503.
[41]Speech in the Senate, June 20, 1832. Works Colvin Colton, ed. New York, Putnam's, 1904, vol. 7, p. 503.
[42]Ibid., p. 503.
[42]Ibid., p. 503.
[43]"Speeches," E. P. Whipple, ed. Little, Brown & Co., 1910, pp. 59-60.
[43]"Speeches," E. P. Whipple, ed. Little, Brown & Co., 1910, pp. 59-60.
[44]"The Constitutional Position of Property in America," Arthur T. Hadley,Independent, April 16, 1908.
[44]"The Constitutional Position of Property in America," Arthur T. Hadley,Independent, April 16, 1908.
The foundations of Empire have been laid in the United States. Territory has been conquered; peoples have been subjugated or annihilated; an imperial class has established itself. Here are all of the essential characteristics of empire.
The American people have been busy laying the political foundations of Empire for three centuries. A great domain, taken by force of arms from the people who were in possession of it has been either incorporated into the Union, or else held as dependent territory. The aborigines have disappeared as a race. The Negroes, kidnaped from their native land, enslaved and later liberated, are still treated as an inferior people who should be the hewers of wood and the drawers of water. A vast territory was taken from Mexico as a result of one war. A quarter million square miles were secured from Spain in another; on the Continent three and a half millions of square miles; in territorial possessions nearly a quarter of a million more—this is the result of little more than two hundred years of struggle; this is the geographic basis for the American Empire.
The structure of owning class power is practically complete in the United States. Through long years the business interests have evolved a form of organization that concentrates the essential power over the industrial and financial processes in a very few hands,—the hands of the investment bankers. During this contest for power the plutocracy learned the value of the control of public opinion, and brought the whole machinery for the direction of public affairs under its domination. Thus political and social institutions as well as the processes of economic life weremade subject to plutocratic authority. A hundred years has sufficed to promulgate ideas of the sacredness of private property that place its preservation and protection among the chief duties of man. Economic organization; the control of all important branches of public affairs, and the elevation of property rights to a place among the beatitudes—by these three means was the authority of the plutocracy established and safeguarded.
Since economic political and social power cover the field of authority that one human being may exercise over another, it might be supposed that the members of the plutocratic class would pause at this point and cease their efforts to increase power. But the owners cannot pause! A force greater than their wills compels them to go on at an ever growing speed. Within the vitals of the economic system upon which it subsists the plutocracy has found a source of never-ending torment in the form of a constantly increasing surplus.
The present system of industry is so organized that the worker is always paid less in wages than he creates in product. A part of this difference between product and wages goes to the upkeep and expansion of the industry in which the worker is employed. Another part in the form of interest, dividends, rents, royalties and profits, goes to the owners of the land and productive machinery.
The values produced in industry and handed to the industrial worker or property owner in the form of income, may be used or "spent" either for "consumption goods"—things that are to be used in satisfying human wants, such as street car transportation, clothing, school books, and smoking tobacco; or for production goods—things that are to be used in the making of wealth, such as factory buildings, lathes, harvesting machinery, railroad equipment. Those who have small incomes necessarily spend the greaterpart for the consumption of goods upon which their existence depends. On the other hand, those who are in receipt of large incomes cannot use more than a limited amount of consumption goods. Therefore, they are in a position to turn part of their surplus into production goods. As a reward for this "saving" the system gives them title to an amount of wealth equal to the amount saved, and in addition, it grants an amount of "interest" so that the next year the recipient of surplus gets the regular share of surplus, and beside that an additional reward in the form of interest. His share of the surplus is thus increased. That is, surplus breeds surplus.
The workers are, for the most part, spenders. The great bulk of their income is turned at once into consumption goods. The owners in many instances are capitalists who hold property for the purpose of turning the income derived from it into additional investments.
Could the worker buy back dollar for dollar the values which he produces there would be no surplus in the form of rent, interest, dividends and profits. The present economic system is, however, built upon the principle that those who own the lands and the productive machinery should be recompensed for their mere ownership. It follows, of course, that the more land and machinery there is to own the greater will be the amount of surplus which will go to the owners. Since surplus breeds surplus the owners find that it pays them not to use all of their income in the form of consumption, but rather to invest all that they can, thereby increasing the share of surplus that is due them. The worker, on the other hand, finds that he must produce a constantly larger amount of wealth which he never gets, but which is destined for the payment of rent, interest, dividends and profits. Increased incomes yield increased investments. Increased investments necessitate the creation and payment of increased surplus. The payment of increased surplus means increased incomes. Thus the circle is continued—with the returns heaping up in the coffers of the plutocracy.
Originally the surplus was utilized to free the members of the owning class from the grinding drudgery of daily toil, by permitting them to enjoy the fruits of the labor of others. Then it was employed in the exercise of power over the economic and social machinery. But that was not the end—instead it proved only the beginning. As property titles were concentrated in fewer and fewer hands, and the amount of property owned by single individuals or groups of individuals becomes greater, their incomes (chiefly in the form of rent, interest, dividends and profits) rose until by 1917 there were 19,103 persons in the United States who declared incomes of $50,000 or more per year, which is the equivalent of $1,000 per week. Among these persons 141 declared annual incomes of over $1,000,000. Besides these personal incomes, each industry which paid these dividends and profits, through its depreciation, amortization, replacement, new construction, and surplus funds was reinvesting in the industries billions of wealth that would be used in the creation of more wealth. The normal processes of the growth of the modern economic system has forced upon the masters of life the problem of disposing of an ever increasing amount of surplus.
During prosperous periods, the investment funds of a community like England and the United States grow very rapidly. The more prosperous the nation, the greater is the demand from those who cannot spend their huge incomes for safe, paying investment opportunities.
The immense productivity of the present-day system of industry has added greatly to the amount of surplus seeking investment. Each invention, each labor saving device, each substitution of mechanical power that multiplies the productive capacity of industry at the same time increases the surplus at the disposal of the plutocracy.
The surplus must be disposed of. There is no other alternative. If hats, flour and gasoline are piled up in the warehouses or stored in tanks, no more of these commodities will be made until this surplus has been used. The whole economic system proceeds on the principle that for eachcommodity produced, a purchaser must be found before another unit of the commodity is ordered. Demand for commodities stimulates and regulates the machinery of production.
Those in control of the modern economic system have no choice but to produce surplus, and once having produced it, they have no choice except to dispose of it. An inexorable fate drives them onward—augmenting their burdens as it multiplies their labors.
Investment opportunities, of necessity, are eagerly sought by the plutocracy, since the law of their system is "Invest or perish"!
Invest? Where? Where there is some demand for surplus capital—that is in "undeveloped countries."
The necessity for disposing of surplus has imposed upon the business men of the world a classification of all countries as "developed" or "undeveloped." "Developed" countries are those in which the capitalist processes have gone far enough to produce a surplus that is sufficient to provide for the upkeep and for the normal expansion of industry. In "developed" countries mines are opened, factories are built, railroads are financed, as rapidly as needed, out of the domestic industrial surplus. "Undeveloped" countries are those which cannot produce sufficient capital for their own needs, and which must, therefore, depend for industrial expansion upon investments of capital from the countries that do produce a surplus.
"Developed" countries are those in which the modern industrial system has been thoroughly established.
The contrast between developed and undeveloped countries is made clear by an examination of the investments of any investing nation, such as Great Britain. Great Britain in 1913 was surrounded by rich, prosperous neighbors—France, Germany, Holland, Belgium. Each year about a billion dollars in English capital was invested outside of the British Isles. Where did this wealth go? The chief objectives of British investment, aside from theBritish Dominions and the United States, were (stated in millions of pounds) Argentine 320; Brazil 148; Mexico 99; Russia 67; France 8 and Germany 6. The wealth of Germany or France is greater than that of Argentine, Brazil and Mexico combined, but Germany and France were developed countries, producing enough surplus for their own needs, and, therefore, the investable wealth of Great Britain went, not to her rich neighbors, but to the poorer lands across the sea.
Each nation that produces an investable surplus—and in the nature of the present economic system, every capitalist nation must some day reach the point where it can no longer absorb its own surplus wealth—must find some undeveloped country in which to invest its surplus. Otherwise the continuity of the capitalist world is unthinkable. Great Britain, Belgium, Holland, France, Germany and Japan all had reached this stage before the war. The United States was approaching it rapidly.
Capitalism is so new that the active struggle to secure investment opportunities in undeveloped countries is of the most recent origin. The voyages which resulted in the discovery, by modern Europeans, of the Americas, Australia, Japan, and an easy road to the Orient, were all made within 500 years. The actual processes of capitalism are products of the past 150 years in England, where they had their origin. In France, Germany, Italy and Japan they have existed for less than a century. The great burst of economic activity which has pushed the United States so rapidly to the fore as a producer of surplus wealth dates from the Civil War. Only in the last generation did there arise the financial imperialism that results from the necessity of finding a market for investable surplus.
The struggle for world trade had been waged for centuries before the advent of capitalism, but the struggle forinvestment opportunities in undeveloped countries is strictly modern. The matter is strikingly stated by Amos Pinchot in his "Peace or Armed Peace" (Nov. 11, 1918).
"If you will look at the maps following page 554 of Hazen's 'Europe since 1815,' or any other standard colored map showing Africa and Asia in 1884, you will see that, but for a few rare spots of coloration, the whole continent of Africa is pure white. Crossing the Red Sea into Arabia, Persia, Mesopotamia and Asia Minor, you will find the same or rather a more complete lack of color. This is merely the cartographer's way of showing, by tint and lack of tint, that at that time Africa and Western Asia were still in the hands of their native populations.
"Let us now turn to the same maps thirty years later, i.e., in 1914. We find them utterly changed. They are no longer white, but a patch work of variegated hues....
"From 1870 to 1900, Great Britain added to her possessions, to say nothing of her spheres of influence, nearly 5,000,000 square miles with an estimated population of 88,000,000. Within a few years after England's permanent occupation of Egypt, which was the signal for the renaissance of French colonialism, France increased hers by 3,500,000 square miles with a population of 37,000,000, not counting Morocco added in 1911. Germany, whose colonialism came later, because home and nearby markets longer absorbed the product of her machines, brought under her dominion from 1884 to 1899 1,000,000 square miles with an estimated population of 14,000,000."
This is a picture of the political effects that followed the economic causes summed up in the term "financial imperialism."
In the seventeenth and eighteenth centuries it was the trader, dealing in raw stuff; in the nineteenth century it was the manufacturer, producing at low cost to cut under his neighbor's price. During the past thirty years the investment banker has occupied the foreground with his efforts to find safe, paying opportunities for the disposal ofthe surplus committed to his care. British bankers, French bankers, German bankers, Belgian bankers, Dutch bankers—all intent upon the same mission—because behind all, and relentlessly driving, were the accumulating surpluses, demanding an outlet. European bankers found that outlet in Africa, Asia, Australia and the Americas. The stupendous strides in the development of the resources in these countries would have been impossible but for that surplus of European capital.
The undeveloped countries to-day have the same characteristics,—virgin resources, industrial and commercial possibilities, and in many cases cheap labor. This is true, for example, in China, Mexico and India. It is true to a less extent in South America and South Africa. The logical destination of capital is the point where the investment will "pay."
The investor who has used up the cream of the home investment market turns his eyes abroad. As a recent writer has suggested, "There is a glamor about the foreign investment" which does not hold for a domestic one. Foreign investments have yielded such huge returns in the past that there is always a seeming possibility of wonderful gains for the future. The risk is greater, of course, but this is more than offset by the increased rate of return. If it were not so, the wealth would be invested at home or held idle.
The great industrial nations are the great investing nations. An agriculture community produces little surplus wealth. Land values are low, franchises and special privileges are negligible factors. There can be relatively little speculation. Changes in method of production are infrequent. Changes in values and total wealth are gradual. The owning class in an agriculture civilization may live comfortably. If it is very small in proportion to the total population it may live luxuriously, but it cannot derivegreat revenues such as those secured by the owning classes of an industrial civilization.
Industrial civilization possesses all of the factors for augmenting surplus wealth which are lacking in agricultural civilizations. Changes in the forms of industrial production are rapid; special privilege yields rich returns and is the subject of wide speculative activity; land values increase; labor saving machinery multiplies man's capacity to turn out wealth. As much surplus wealth might be produced in a year of this industrial life as could have been turned out in a generation or a century of agricultural activity or of hand-craft industry.
England, France, Germany, Holland, Belgium, Japan and the United States, the great industrial nations, have become the great lending nations. Their search for "undeveloped territory" and "spheres of influence" is not a search for trade, but for an opportunity to invest and exploit. If these nations wished to exchange cotton for coffee, or machinery for wheat on even terms, they could exchange with one another, or with one of the undeveloped countries, but they demand an outlet for surplus wealth—an outlet that can only be utilized where the government of the developed country will guarantee the investment of its citizens in the undeveloped territory.
The investing nations either want to take the raw products of the undeveloped country, manufacture them and sell them back as finished material (the British policy in India), or else they desire to secure possession of the resources, franchises and other special privileges in the undeveloped country which they can exploit for their own profit (the British policy in South America).
The Indians, under the British policy, are thus in relatively the same position as the workers in one of the industrial countries. They are paid for their raw material a fraction of the value of the finished product. They are expected to buy back the finished product, which is a manifest impossibility. There is thus a drastic limitation on theexploitation of undeveloped countries, just as there is a limitation on the exploitation of domestic labor. In both cases the people as consumers can buy back less in value than the exploiters have to sell. Obviously the time must come when all the undeveloped sections of the world have been exploited to the limit. Then surplus will go a-begging.
Some of the investors in the great exploiting nations have abandoned the idea of making huge returns by way of the English policy in India. Instead the investors in every nation are buying up resources, franchises and concessions and other special privileges in the undeveloped countries and treating them in exactly the same way that they would treat a domestic investment. In this case the resources and labor of the undeveloped country are exploited for the profit of the foreign investor.
The Roman conquerors subjugated the people politically and then exacted an economic return in the form of tribute. The modern imperialists do not bother about the political machinery, so long as it remains in abeyance, but content themselves with securing possession of the economic resources of a region and exacting a return in interest and dividends on the investment. Political tribute is largely a thing of the past. In its place there is a new form—economic tribute—which is safer, cheaper, and on the whole far superior to the Roman method of exploiting undeveloped regions.
A hundred years ago the United States was an undeveloped country. Its resources were virgin. Its wealth possibilities were immense. Both domestic and foreign capitalists invested large sums in the canals, the railroads and other American commercial and industrial enterprises. The rapid economic expansion of recent years has involved the outlay of huge sums of new capital.
The total capital invested in manufactures was 8,975 millions in 1899 and 22,791 millions in 1914. The totalof railway capital was 11,034 millions in 1899 and 20,247 millions in 1914. Manufacturing and railroading alone secured a capital outlay of over 20 billions in 15 years. Some idea of the increase in investments may be gained from the amount of new stocks and bonds listed annually on the New York Stock Exchange. The total amount of new stocks listed for the five years ending with 1914 was 1,420 millions; the total of new bonds was 2,226 million. (The Financial Review Annual, 1918, p. 67.) The total capital of new companies (with an authorized capital of at least $100,000) was in 1918, $2,599,753,600; in 1919, $12,677,229,600, and in the first 10 months of 1920, $12,242,577,700. (Bradstreets, Nov. 6, 1920, p. 731.) The figures showing the amount of stocks and bonds issued do not by any means exhaust the field of new capital. Reference has already been made to the fact that the United States Steel Corporation, between 1903 and 1918 increased its issues of stocks and bonds by only $31,600,000, while, in the same time its assets increased $987,000,000. The same fact is illustrated, on a larger scale, in a summary (Wall Street Journal, August 7, 1919) of the finances of 104 corporations covering the four years, December 31, 1914, to December 31, 1918. During this time, six of the leading steel companies of the United States increased their working capital by $461,965,000 and their surplus by $617,656,000. This billion was taken out of the earnings of the companies. Concerning the entire 104 corporations, theJournalnotes that, "After heavy expenditures for new construction and acquisitions, and record breaking dividends, they added a total of nearly $2,000,000,000 to working capital." In addition, these corporations, in four years, showed a gain of $1,941,498,000 in surplus and a gain in inventories of $1,522,000,000.
Considerable amounts of capital are invested in private industry, by individuals and partnerships. No record of these investments ever appears. Farmers invest in animals, machinery and improved buildings—investments that are not represented by stocks or bonds. Again, the great corporations themselves are constantly adding to theirassets without increasing their stock or bond issues. In these and other ways, billions of new capital are yearly absorbed by the home investment market.
Although most of the enterprises of the United States have been floated with American capital, the investors of Great Britain, Holland, France and other countries took a hand. In 1913 the capitalists of Great Britain had larger investments in the United States than in any other country, or than in any British Dominion. (The U. S., 754,617,000 pounds; Canada and Newfoundland, 514,870,000 pounds; India and Ceylon, 378,776,000 pounds; South Africa, 370,192,000 pounds and so on.) (Annals, 1916, Vol. 68, p. 28, Article by C. K. Hobson.) The aggregate amount of European capital invested in the United States was approximately $6,500,000,000 in 1910. Of this sum more than half was British. ("Trade Balance of the United States," George Paisch. National Monetary Commission, 1910, p. 175.)
By the beginning of the present century (the U. S. Steel Corporation was organized in 1901) the main work of organization inside of the United States was completed. The bankers had some incidental tasks before them, but the industrial leaders themselves had done their pioneer duty. There were corners to be smoothed off, and bearings to be rubbed down, but the great structural problems had been solved, and the foundations of world industrial empire had been laid.
The Spanish-American War marks the beginning of the new era in American business organization. This war found the American people isolated and provincial. It left them with a new feeling for their own importance.
The worlds at home had been conquered. The transcontinental railroads had been built; the steel industry, the oil industry, the coal industry, the leather industry, the woolen industry and a host of others had been organizedby a whole generation of industrial organizers who had given their lives to this task.
Across the borders of the United States—almost within arm's reach of the eager, stirring, high-strung men of the new generation, there were tens of thousands of square miles of undeveloped territory—territory that was fabulously rich in ore, in timber, in oil, in fertility. On every side the lands stretched away—Mexico, the West Indies, Central America, Canada—with opportunity that was to be had for the taking.
Opportunity called. Capital, seeking new fields for investment, urged. Youth, enthusiasm and enterprise answered the challenge.
The foreign investments of the United States at the time of the Spanish-American War were negligible. By 1910 American business men had two billions invested abroad—$700,000,000 in Mexico; $500,000,000 in Canada; $350,000,000 in Europe, and smaller sums in the West Indies, the Philippines, China, Central and South America. In 1913 there was a billion invested in Mexico and an equal amount in Canada. ("Commercial Policy," W. S. Culbertson, New York, Appleton, 1919, p. 315.)
Capital flowed out of the United States in two directions:
1. Toward the resources which were so abundant in certain foreign countries.2. Toward foreign markets.
1. Toward the resources which were so abundant in certain foreign countries.
2. Toward foreign markets.
The Bethlehem Steel Corporation is a typical industry that has built up foreign connections as a means of exploiting foreign resources. The Corporation has a huge organization in the United States which includes 10 manufacturing plants, a coke producing company, 11 ship building plants, six mines and quarries, and extensive coal deposits in Pennsylvania and West Virginia. The Bethlehem Steel Corporation also controls ore properties nearSantiago, Cuba, near Nipe Bay, Cuba, and extensive deposits along the northern coast of Cuba; large ore properties at Tofo, Chile, and the Ore Steamship Corporation, a carrying line for Chilean and Cuban ore.
The American Smelting and Refining Company is another illustration of expansion into a foreign country for the purpose of utilizing foreign resources. According to the record of the Company's properties, the Company was operating six refining plants, one located in New Jersey; one in Nebraska; one in California; one in Illinois; one in Maryland, and one in Washington. The Company owned 14 lead smelters and 11 copper smelters, located as follows: Colorado, 4; Utah, 2; Texas, 2; Arizona, 2; New Jersey, 2; Montana, 1; Washington, 1; Nebraska, 1; California, 1; Illinois, 1; Chile, 2; Mexico, 6. Among these 25 plants a third is located outside of the United States.
These are but two examples. The rubber, oil, tobacco and sugar interests have pursued a similar policy—extending their organization in such a way as to utilize foreign resources as a source for the raw materials that are destined to be manufactured in the United States.
The Bethlehem Steel Corporation and the American Smelting and Refining Company go outside of the United States for the resources upon which their industries depend. Their fabricating industries are carried on inside of the country. There are a number of the great industries of the country that have gone outside of the United States to do their manufacturing and to organize the marketing of their products.
The International Harvester Company has built a worldwide organization. It manufactures harvesting machinery, farm implements, gasoline engines, tractors, wagons and separators at Springfield, Ohio; Rock Falls, Ill.; Chicago, Ill.; Auburn, New York; Akron, Ohio; Milwaukee, Wisc.,and West Pullman, Ill. It has iron mines, coal mines and steel plants operated by the Wisconsin Steel Company. It has three twine mills and four railways. Foreign plants and branches are listed as follows: Norrkoping, Sweden; Copenhagen, Denmark; Christiania, Norway; Paris, France; Croix, France; Berlin, Germany; Hamilton, Ontario, Canada; Zurich, Switzerland; Vienna, Austria; Lubertzy, Russia; Neuss, Germany; Melbourne, Australia; London, England; Christ Church, New Zealand.
One of the greatest industrial empires in the world is the Standard Oil Properties. It is not possible to go into detail with regard to their operations. Space will admit of a brief comment upon one of the constituent parts or "states" of the empire—The Standard Oil Company of New Jersey. With a capital stock of $100,000,000, this Company, from the dissolution of the Standard Oil Company, December 15, 1911, to June 15, 1918, a period of six and a half years, paid dividends of $174,058,932.
The company describes itself as "a manufacturing enterprise with a large foreign business. The company drills oil wells, pumps them, refines the crude oil into many forms and sells the product—mostly abroad." (The Lamp, May, 1918.) The properties of the Company are thus listed:
1. The Company has 13 refineries, seven of them in New Jersey, Maryland, Oklahoma, Louisiana and West Virginia. Four of the remaining refineries are located in Canada, one is in Mexico and one in Peru.
2. Pipeline properties in New York, New Jersey, Pennsylvania and Maryland.
3. A fleet of 54 ocean-going tank steamers with a capacity of 486,480 dead weight tons. (This is about two per cent of the total ocean-going tonnage of the world.)
4. Can and case factories, barrel factories, canning plants, glue factories and pipe shops.
5. Through its subsidiary corporations, the Company controls:
a. Oil wells in Pennsylvania, West Virginia, Ohio, Kentucky, Louisiana, Arkansas, Mississippi, Texas, California, Peru and Mexico. In connection with many of these properties refineries are operated.
b. One subsidiary has 550 marketing stations in Canada. Others market in various parts of the United States; in the West Indies; in Central and South America; in Germany, Austria, Roumania, the Netherlands, France, Denmark and Italy.
The Standard Oil Company of New Jersey comprises only one part—though a very successful part—of the Standard Oil Group of industries. It is one industrial state in a great industrial empire.
Foreign resources offer opportunities to the exploiter. Foreign markets beckon. Both calls have been heeded by the American business interests that are busy building the international machinery of business organization.
The steel, smelting, oil, sugar, tobacco, and harvester interests are confined to relatively narrow lines. In their wake have followed general business, and above all, financial activities.
The American International Corporation was described by its vice-president (Mr. Connick) before a Senate Committee on March 1, 1918. "Until the Russian situation became too acute, they had offices in Petrograd, London, Paris, Rome, Mexico City. They sent commissions and agents and business men to South America to promote trade.... They were negotiating contracts for a thousand miles of railroad in China. They were practically rebuilding, you might say, the Grand Canal in China. They had acquired the Pacific Mail.... They then bought the New York Shipbuilding Corporation to provide ships for their shipping interests."
By 1919 (New York Times, Oct. 31, 1919) the Company had acquired Carter Macy & Co., and the Rosin and Turpentine Export Co., and was interested in the International Mercantile Marine and the United Fruit Companies.
Another illustration of the same kind of general foreign business appeared in the form of an advertisement inserted on the financial page of theNew York Times(July 10, 1919) by three leading financial firms, which called attention to a $3,000,000 note issue of the Haytian American Corporation "Incorporated under the laws of the State of New York, owning and operating sugar, railroad, wharf and public utility companies in the Republic of Hayti." Further, the advertisers note: "The diversity of the Company's operations assures stability of earnings."
American manufacturers, traders and industrial empire builders have not gone alone into the foreign field. The bankers have accompanied them.
Several of the great financial institutions of the country are advertising their foreign connections.
The Guaranty Trust Company (New York Times, Jan. 10, 1919) advertises under the caption "Direct Foreign Banking Facilities" offering "a direct and comprehensive banking service for trade with all countries." These connections include:
1. Branches in London and Paris, which are designated United States depositories. "They are American institutions conducted on American lines, and are especially well equipped to render banking service throughout Europe." There are additional branches in Liverpool and Brussels. The Company also has direct connections in Italy and Spain, and representatives in the Scandinavian countries.
2. "Direct connections with the leading financial institutions in Argentina, Uruguay, Chile, and Brazil." A special representative in Buenos Ayres. "Through our affiliation with the Mercantile Bank of the Americas and its connections, we cover Peru, Northern Brazil, Columbia,Ecuador, Venezuela, Nicaragua, Honduras, Guatemala, and other South and Central American countries."
3. "Through the American Mercantile Bank of Cuba, at Havana, we cover direct Cuba and the West Indies."
4. "Direct banking and merchant service throughout British India," together with correspondents in the East Indies and the Straits Settlements.
5. "Direct connections with the National Bank of South Africa, at Cape Town, and its many branches in the Transvaal, Rhodesia, Natal, Mozambique, etc."
6. Direct banking connections and a special representative in Australia and New Zealand.
7. "Through our affiliations with the Asia Banking Corporation we negotiate, direct, banking transactions of every nature in China, Manchuria, Southeastern Siberia, and throughout the Far East. The Asia Banking Corporation has its main office in New York and is establishing branches in these important trade centers: Shanghai, Pekin, Tientsin, Hankow, Harbin, Vladivostok. We are also official correspondents for leading Japanese banks."
The advertisement concludes with this statement: "Our Foreign Trade Bureau collects and makes available accurate and up-to-date information relating to foreign trade—export markets, foreign financial and economic conditions, shipping facilities, export technique, etc. It endeavors to bring into touch buyers and sellers here and abroad."
The same issue of theTimescarries a statement of the Mercantile Bank of the Americas which "offers the services of a banking organization with branches and affiliated banks in important trade centers throughout Central and South America, France and Spain." The Bank describes itself as "an American Bank for Foreign trade." Among its eleven directors are the President and two Vice-Presidents of the Guaranty Trust Company.
The Asia Banking Corporation, upon which the Guaranty Trust Company relies for its Eastern connections, was organized in 1918 "to engage in international and foreignbanking in China, in the dependencies and insular possessions of the United States, and, ultimately in Siberia" (Standard Corporation Service, May-August, 1918, p. 42). The officers elected in August 1918, were Charles H. Sabin, President of the Guaranty Trust Co., President; Albert Breton, Vice-President of the Guaranty Trust Co., and Ralph Dawson, Assistant Secretary of the Guaranty Trust Company, Vice-Presidents, and Robert A. Shaw, of the overseas division of the Guaranty Trust Company, Treasurer. Among the directors are representatives of the Bankers Trust Company and of the Mercantile Bank of the Americas.
The National City Bank of New York—the first bank in the history of the Western Hemisphere to show resources exceeding one billion dollars—illustrates in its development the cyclonic changes that the past few years have brought into American business circles. The National City Bank, originally chartered in 1812, had resources of $16,750,929 in 1879 and of $18,214,823 in 1889. From that point its development has been electric. The resources of the Bank totaled 128 millions in 1899; 280 millions in 1909; $1,039,418,324 in 1919. Between 1889 and 1899 they increased 600 per cent; between 1899 and 1919 they increased 700 per cent; during the 40 years from 1889 and 1919 the increase in resources exceeded six thousand per cent.
The organization of the Bank is indicative of the organization of modern business. Among the twenty-one directors, all of whom are engaged in some form of business enterprise, there are the names of William Rockefeller, Percy A. Rockefeller, J. Ogden Armour, Cleveland H. Dodge of the Phelps-Dodge Corporation, Cyrus H. McCormick of the International Harvester Co., Philip A. S. Franklin, President of the International Mercantile Marine Co.; Earl D. Babst, President of the American Sugar Refining Co.; Edgar Palmer, President of the New JerseyZinc Co.; Nathan C. Kingsbury, Vice-President of the Union Pacific Railroad Co., and Frank Krumball, Chairman of the Chesapeake & Ohio Railroad Co. Some of the most powerful mining, manufacturing, transportation and public utility interests in the United States are represented, directly or indirectly, in this list.
The domestic organization of the Bank consists of five divisions, each one under a vice-president. New York City constitutes the first division; the second division comprises New England and New York State outside of New York City; the three remaining divisions cover the other portions of the United States. Except for the size and the completeness of its organization, the National City Bank differs in no essential particulars from numerous other large banking institutions. It is a financial superstructure built upon a massive foundation of industrial enterprise.
The phase of the Bank's activity that is of peculiar significance at the present juncture is its foreign organization, all of which has been established since the outbreak of the European war.
The foreign business of the National City Bank is carried on by the National City Bank proper and the International Banking Corporation. The first foreign branch of the National City Bank was established at Buenos Aires on November 10th, 1914. On January 1st, 1919, the National City Bank had a total of 15 foreign branches; on December 31st, 1919, it had a total of 74 foreign branches.
The policy of the Bank in its establishment of foreign branches is described thus in its "Statement of Condition, December 31st, 1919": "The feature of branch development during the year was the expansion in Cuba, where twenty-two new branches were opened, making twenty-four in the island. Cuba is very prosperous, as a result of the expansion of the sugar industry, and as sugar is produced there under very favorable conditions economically, and the location is most convenient for supplying the United States, the industry is on a sound basis, and relations with theUnited States are likely to continue close and friendly. Cuba is a market of growing importance to the United States, and the system of branches established by the Bank is designed to serve the trade between the two countries." The trader and the Banker are to work hand in hand.
The National City Bank has branches in Argentina, Brazil, Belgium, Chile, Colombia, Cuba, Italy, Porto Rico, Russia, Siberia, Spain, Trinidad, Uruguay and Venezuela, all of which have been established since 1914.
A portion of the foreign business of the National City Bank is conducted by the International Banking Corporation which was established in 1902 and which became a part of the National City Bank organization in 1915. The International Banking Corporation has a total of twenty-eight branches located in California, China, England, France, India, Japan, Java, Dominican Republic, Philippine Islands, Republic of Panama and the Straits Settlements. Under this arrangement, the financial relations with America are made by the National City Bank proper; while those with Europe and Asia are in the hands of the International Banking Corporation and the combination provides the Bank with 75 branches in addition to its vast organization within the United States.
The National City Bank of 1889, with its resources of eighteen millions, was a small affair compared with the billion dollar resources of 1920. Thirty years sufficed for a growth from youth to robust adulthood. Within five years, the Bank built up a system of foreign branches that make it one of the most potent States in the federation of international financial institutions.
Exploiters of foreign resources, manufacturers, traders and bankers have moved, side by side, out of the United States into the foreign field. Step by step they have advanced, rearing the economic structure of empire as they went.
The business men of the United States had no choice. They could not pause when they had spanned the continent. Ambition called them, surplus compelled them, profits lured them, the will to power dominated their lives. As well expect the Old Guard to pause in the middle of a charge—even before the sunken road at Waterloo—as to expect the business interests of the United States to cease their efforts and lay down their tools of conquest simply because they had reached the ocean in one direction. While there were left other directions in which there was no ocean; while other undeveloped regions offered the possibility of development, an inexorable fate—the fate inherent in the economic and the human stuff with which they were working compelled them to cry "Onward!" and to turn to the tasks that lay ahead.
The fathers and grandfathers of these Twentieth Century American Plutocrats, working coatless in their tiny factories; managing their corner stores; serving their local banks, and holding their minor offices had never dreamed of the destiny that lay ahead. No matter. The necessity for expansion had come and with it came the opportunity. The economic pressure complemented the human desire for "more." The structure of business organization, which was erected to conquer one continent could not cease functioning when that one continent was subdued. Rather, high geared and speeded up as it was, it was in fine form to extend its conquests, like the well groomed army that has come scatheless through a great campaign, and that longs, throughout its tensely unified structure to be off on the next mission.
The business life of the United States came to the Pacific; touched the Canadian border; surged against the Rio Grande. The continent had been spanned; the objective had been attained. Still, the cry was "Onward!"
Onward? Whither?
Onward to the lands where resources are abundant and rich; onward where labor is plentiful, docile and cheap;onward where the opportunities for huge profits are met with on every hand; onward into the undeveloped countries of the world.
The capitalists of the European nations, faced by a similar necessity for expansion, had been compelled to go half round the earth to India, to South Africa, to the East Indies, to China, to Canada, to South America. Close at home there was no country except Russia that offered great possibilities of development.
The business interests of the United States were more fortunate. At their very doors lay the opportunities—in Canada, in Mexico, in the West Indies, in Central and South America. Here were countries with the amplest, richest resources; countries open for capitalist development. To be sure these investment fields had been invaded already by foreign capitalists—British, German, Belgian and Spanish. But at the same time they were surrounded by a tradition of great virility and power—the tradition of "America for the Americans."
The work of industrial empire building had continued for less than half a century when the United States entered the Great War, which was one in a sequence of events that bound America to the wheel of destiny as it bound England and France and Germany and Japan and every other country that had adopted the capitalist method of production.
The war-test revealed the United States to the world and to its own people as a great nation playing a mighty rôle in international affairs. Most Europeans had not suspected the extent of its power. Even the Americans did not realize it. Nevertheless, the processes of economic empire building had laid a foundation upon which the superstructure of political empire is reared as a matter of course. Henceforth, no one need ask whether the United States should or should not be an imperial nation. There remained only the task of determining what form American imperialism should take.
The Great War rounded out the imperial beginnings of the United States. It strengthened the plutocracy at home; it gave the United States immense prestige abroad.
The Era of Imperialism dawned upon the United States in 1898. Daylight broke in 1914, and the night of isolation and of international unimportance gave place to a new day of imperial power.
The rapid sweep across a new continent had placed the resources of the United States in the hands of a powerful minority. Nature had been generous and private ownership of the inexhaustible wilderness seemed to be the natural—the obvious method of procedure.
The lightning march of the American people across the continent gave the plutocracy its grip on the natural resources. The revolutionary transformations in industry guaranteed its control of the productive machinery.
The wizards of industrial activity have changed the structure of business life even more rapidly than they have conquered the wilderness. True sons of their revolutionary ancestors, they have slashed and remodeled and built anew with little regard for the past.
Revolutions are the stalking grounds of predatory power. Napoleon built his empire on the French Revolution; Cromwell on the revolt against tyrannical royalty in England. Peaceful times give less opportunity to personal ambition. Institutions are well-rooted, customs and habits are firmly placed, life is regulated and held to earth by a fixed framework of habit and tradition.
Revolution comes—fiercely, impetuously—uprooting institutions, overthrowing traditions, tearing customs from their resting places. All is uncertainty—chaos, when, lo! a man on horseback gathers the loose strands together saying, "Good people, I know, follow me!"
He does know; but woe to the people who follow him! Yet, what shall they do? Whither shall they turn? How shall they act? Who can be relied upon in this uncertain hour?
The man on horseback rises in his stirrups—speaking in mighty accents his message of hope and cheer, reassuring, promising, encouraging, inspiring all who come within the sound of his voice. His is the one assurance in a wilderness of uncertainty. What wonder that the people follow where he leads and beckons!
The revolutionary changes in American economic life between the Civil War and the War of 1914 gave the plutocrat his chance. He was the man on horseback, quick, clever, shrewd, farseeing, persuasive, powerful. Through the courses of these revolutionary changes, the Hills, Goulds, Harrimans, Wideners, Weyerhausers,Guggenheims, Rockefellers, Carnegies, and Morgans did to the American economic organization exactly what Napoleon did to the French political organization—they took possession of it.
The American people were still thinking the thoughts of a competitive economic life when the cohorts of an organized plutocracy bore down upon them. High prices, trusts, millionaires, huge profits, corruption, betrayal of public office took the people by surprise, confused them, baffled them, enraged them. Their first thought was of politics, and during the years immediately preceding the war they were busy with the problem of legislating goodness into the plutocracy.
The plutocrats were in public disfavor, and their control of natural resources, banks, railroads, mines, factories, political parties, public offices, governmental machinery, the school system, the press, the pulpit, the movie business,—all of this power amounted to nothing unless it was backed by public opinion.
How could the plutocracy—the discredited, vilified plutocracy—get public opinion? How could the exploiters gain the confidence of the American people? There was only one way—they must line up with some cause that would command public attention and compel public support. The cause that it chose was the "defense of the United States."
The plutocracy, with a united front, "went in" for the "defense of the United States,"—attacking the people on the side of their greatest weakness; playing upon their primitive emotions of fear and hate. The campaign was intense and dramatic, featuring Japanese invasions, Mexican inroads, and a world conquest by Germany.
The preparedness campaign was a marvel of efficient business organization. Its promoters made use of every device known to the advertising profession; the best brains were employed, and the country was blanketed with preparedness propaganda.
Officers of the Army and Navy were frank in insisting that the defense of the United States was adequately provided for. (See testimony of General Nelson A. Miles.Congressional Record, February 3, 1916, p. 2265.) Still the preparedness campaign continued with vigor. Congressman Clyde H. Tavenner in his speech, "The Navy League Unmasked," showed why. He gave facts like those appearing in George R. Kirkpatrick's book, "War, What For"; in F. C. Howe's "Why War," and in J. A. Hobson's "Imperialism," showing that, in the words of an English authority, "patriotism at from 10 to 15 per cent is a temptation for the best of citizens."
Tavenner established the connection between the preparedness campaign and those who were making profits out of the powder business, the nickel business, the copper business, and the steel business, interlocked through interlocking directorates; then he established the connection between the Navy League and the firm of J. P. Morgan & Co., 23 Wall St., New York. Regarding this connection, Congressman Tavenner said, "The Navy League upon close examination would appear to be little more than a branch office of the house of J. P. Morgan & Co., and a general sales promotion bureau for the various armor and munition makers and the steel, nickel, copper and zinc interests."[45]
The preparedness movement came from the business interests. It was fostered and financed by the plutocrats. It was their first successful effort at winning public confidence, and so well was it managed that millions of Americans fell into line, fired by the love of the flag and the world-old devotion to family and fireside.
From preparedness to patriotism was an easy step. The preparedness advocates had evoked the spirit of the founders of American democracy and worked upon the emotions of the people until it was generally understood that those who favored preparedness were patriots.
Plutocratic patriotism was accepted by the press, the pulpit, the college, and every other important channel of public information in the United States. Editors, ministers, professors and lawyers proclaimed it as though it were their own. Randolph Bourne, in a brilliant article (Seven Arts, July, 1917) reminds his readers of "the virtuous horror and stupefaction when they read the manifesto of their ninety-three German colleagues in defense of the war. To the American academic mind of 1914 defense of war was inconceivable. From Bernhardi it recoiled as from a blasphemy, little dreaming that two years later would find it creating its own cleanly reasons for imposing military service on the country and for talking of the rough rude currents of health and regeneration that war would send through the American body politic. They would have thought any one mad who talked of shipping American men by the hundreds of thousands—conscripts—to die on the fields of France...."
The American plutocracy was magnified, deified, and consecrated to the task of making the world safe for democracy. Exploiters had turned saviors and were conducting a campaign to raise $100,000,000 for the Red Cross.[46]The "malefactors of great wealth," the predatory business forces, the special privileged few who had exploited the American people for generations, became the prophets and the crusaders,the keepers of the ark of the covenant of American democracy.
Radicals who had always opposed war, ministers who had spent their lives preaching peace upon earth, scientists whose work had brought them into contact with the peoples of the whole world, public men who believed that the United States could do greater and better work for democracy by staying out of the war, were branded as traitors and were persecuted as zealously as though they had sided with Protestantism in Catholic Spain under the Inquisition.
By a clever move, the plutocrats, wrapped in the flag and proclaiming a crusade to inaugurate democracy in Germany, rallied to their support the professional classes of the United States and millions of the common people.
After the declaration of war, the mobilization and direction of the economic war work of the government was placed in the hands of the Council of National Defense, an organized group of the leading business men. The Council consisted of six members of the President's Cabinet, assisted by an Advisory Commission and numerous sub-committees. The "Advisory Commission" of the Council (the real working body) contained four business men, an educator, a labor leader and a medical man. ("The Council of National Defense" a bulletin issued by the Council under date of June 28, 1917.)
Each member of the Advisory Commission had a group of persons coöperating with him. The make-up of these various committees was significant. Among 706 persons listed in the original schedule of sub-committees, 404 were business men, 200 were professional men, 59 were labor men, 23 were public officials and 20 were miscellaneous. It was only in Mr. Gompers' group that labor had any representation, and even there, out of 138 persons only 59 were workers or officials of unions, while 34 were businessmen and 33 professional men, so that among Mr. Gompers' assistants the business and professional men combined considerably outnumbered the labor men.
The make-up of some of the sub-committees revealed the forces behind the Defense Council. Thus Mr. Willard's sub-committee on "Express" consisted of four vice-presidents, one from the American, one from the Wells-Fargo, one from the Southern and one from the Adams Express Company. His committee on "Locomotives" consisted of the Vice-President of the Porter Locomotive Company, the President of the American Locomotive Company, and the Chairman of the Lima Locomotive Corporation. Mr. Rosenwald's committee on "Shoe and Leather Industries" consisted of eight persons, all of them representing shoe or leather companies. His committee on "Woolen Manufactures" consisted of eight representatives of the woolen industry. The same business supremacy appeared in Mr. Baruch's committees. His committee on "Cement" consisted of the presidents of four of the leading cement companies, the vice-president of a fifth cement company, and a representative of the Bureau of Standards of Washington. His committee on "Copper" had the names of the presidents of the Anaconda Copper Company, the Calumet & Hecla Mining Company, the United Verde Copper Company and the Utah Copper Company. His committee on "Steel and Steel Products" consisted of Elbert H. Gary, Chairman of the United States Steel Corporation; Charles M. Schwab, of the Bethlehem Steel Company; A. C. Dinkey, Vice-President of the Midvale Steel Company; W. L. King, Vice-President of Jones & Loughlin Steel Company, and J. A. Burden, President of the Burden Steel Company. The four other members of the committee represented the Republic Iron and Steel Company, the Lackawanna Steel Company, the American Iron and Steel Institute and the Picklands, Mather Co., of Cleveland. Perhaps the most astounding of all the committees was that on "Oil." The chairman was the President of the Standard Oil Company, and the secretary of the committee gives his address as "26 Broadway," the address of the Standard OilCompany. The other nine members of the committee were oil men from various parts of the country. What thinking American would have suggested, three years before, that the Standard Oil Company would be officially directing a part of the work of the Federal Government?
Comment is superfluous. Every great industrial enterprise of the United States had secured representation on the committees of business men that were responsible for the direction of the economic side of war making.
Then came the Liberty Loan campaigns and Red Cross drives, the direction of which also was given into the hands of experienced business men. In each community, the leaders in the business world were the leaders in these war-time activities. Since the center of business life was the bank, it followed that the directing power in all of the war-time campaigns rested with the bankers, and thus the whole nation was mobilized under the direction of its financiers.
The results of these experiences were far-reaching. During two generations, the people of the United States had been passing anti-trust laws and anti-pooling laws, the aim of which was to prevent the business men of the country from getting together. The war crisis not only brought them together, but when they did assemble, it placed the whole political and economic power of the nation in their hands.
The business men learned, by first hand experience, the benefits that arise from united effort. They joined forces across the continent, and they found that it paid. James S. Alexander, President of the National Bank of Commerce (New York), tells the story from the standpoint of a banker (Manchester Guardian, January 28, 1920. Signed Article.) In a discussion of "the experience in coöperative action which the war has given American banks" he says, "The responsibility of floating the five great loans issued by the government, together with the work of financing a production of materials speeded up to meet war necessities, enforced a unity of action and coöperation which otherwise could hardly have been obtained in many years."
The war gains of the plutocracy in the field of public control were important, as well as spectacular. Behind them, however, were economic gains—little heralded, but of the most vital consequence to the future of plutocratic power.
The war speeded production and added greatly to the national income, to investable surplus, to profits and thus to the economic power of the plutocrats.
The most tangible measure of the economic advantage gained by the plutocracy from the war is contained in a report on "Corporate Earnings and Government Revenues" (Senate Document 259. 65th Congress, Second Session). This report shows the profits made by the various industries during 1917—the first war year.
The report contains 388 large pages on which are listed the profits ("percent of net income to capital stock in 1917") made by various concerns. A typical food producing industry—"meat packing"—lists 122 firms (p. 95 and 365). Of these firms 31 reported profits for the year of less than 25 percent; 45 reported profits of 25 but under 50 percent; 24 reported profits of 50 but under 100 percent, and 22 reported profits of 100 percent or more. In this case, a third of the profits were more than 25, but less than 50 percent, and half were 50 percent or over.
Manufacturers of cotton yarns reported profits ranging slightly higher than those in the meat packing industry (pp. 167, 168, 379). Among the 153 firms reporting, 21 reported profits of less than 25 percent; 61 reported 25 but less than 50 per cent; 55 reported 50 but under 100 percent, and 16 reported 100 percent or more.
Profits in the garment manufacturing industry were lower than those in yarn manufacturing. Among the 299 firms reporting (pp. 171, 380) 74 gave their profits as less than 25 percent; 121 gave their profits as 25 but under 50percent; 65 gave profits of 50 but less than 100 percent, and 39 gave their profits as 100 percent or over.
The profits of 49 Steel plants and Rolling Mills (pp. 100, 365) were considerably higher than profits in any of the industries heretofore discussed. Four firms reported profits of less than 25 percent; 13 reported profits of 25 but less than 50 percent; 17 reported profits of 50 but less than 100 percent, and 15 reported profits of more than 100 percent. In this instance two-thirds of the firms show profits of 50 percent or over.
Bituminous Coal producers in the Appalachian field (340 in number, pp. 130 and 372) report a range of profits far higher than those secured in the manufacturing industries. Among these 340 firms, 23 reported profits of less than 25 percent; 45 reported profits of 25 but under 50 percent; 79 reported profits of 50 but under 100 percent; 135 reported profits of 100 but under 500 percent; 21 reported profits of 500 but under 1,000 percent, and 14 reported profits of 1,000 percent and over. In the case of these coal mine operators only a fourth had profits of under 50 percent and half had profits of more than 100 percent.
The profits in these five industries—food, yarn, clothing, steel and coal—are quite typical of the figures for the tens of thousands of other firms listed in Senate Document 259. Profits of less than 25 percent are the exception. Profits of over 100 percent were reported by 8 percent of the yarn manufacturers, by 13 percent of the garment manufacturers, by 18 percent of the meat packers, by 31 percent of the steel plants, and by 50 percent of the bituminous coal mines. A considerable number of profits ranged above 500 percent, or a gain in one year of five times the entire capital stock.
When it is remembered that these figures were supplied by the firms involved; that they were submitted to a tremendously overworked department, lacking the facilities for effective checking-up; and that they were submitted for the purposes of heavy taxation, the showing is nothing less than astounding.
What has the American plutocracy won at home as a result of the war? In two words it has gained social prestige and internal (economic) solidarity. Both are vital as the foundation for future assertions of power.
The plutocracy has unified its hold upon the country as a result of the war. Also, it has won an important battle in its struggle with labor. The position held by the American plutocracy at the end of the Great War could hardly be stated more adequately than in a recent Confidential Information Service furnished by an important agency to American business men:
"Shall Victors Be Magnanimous?
"There is no doubt about it—Labor is beaten. Mr. Gompers was at his zenith in 1918. Since then he has steadily lost power. He has lost power with his own people because he is no longer able to deliver the goods. He can no longer deliver the goods for two reasons. For one thing, peace urgency has replaced war urgency and we are not willing to bid for peace labor as we were willing to bid for war labor. For another thing, the employing class is immensely more powerful than it was in 1914.
"We have an organized labor force more numerous than ever before. Relatively twice as many workers are organized as in 1916. But this same labor force has lost its hold on the public. Furthermore, it is divided in its own camp. It fears capital. It also fears its own factions. It threatens, but it does not dare.
"We said that the employing class was immensely more powerful than in 1914. There is more money at its command. Eighteen thousand new millionaires are the war's legacy. This money capacity is more thoroughly unified than ever. In 1914 we had thirty-thousand banks, functioning to a great degree in independence of each other. Then came the Federal Reserve Act and gave us themachinery for consolidation and the emergency of five years war furnished the hammer blows to weld the structure into one.
"The war taught the employing class the secret and the power of widespread propaganda. Imperial Europe had been aware of this power. It was new to the United States. Now, when we have anything to sell to the American people we know how to sell it. We have learned. We have the schools. We have the pulpit. The employing class owns the press. There is practically no important paper in the United States but is theirs!"