The Racing Trust
BY THOMAS B. FIELDERS
THE only Trust that has the sincere and earnest and unfaltering support of the daily press is the most audacious, the most grasping, the most immoral of all trusts. This is the Racing Trust. There are hundreds of trusts in this country. All corporations that have eliminated or lessened competition to a marked degree are called trusts. It is asserted, commonly, that such combinations are against the laws of the states that form the Union and are in opposition to the Federal Constitution. If the Beef Trust or the Sugar Trust or the Standard Oil Trust have advocates among the daily newspapers of the country, these advocates are not earning their salt, to say nothing of their salaries. The only support they have the courage to give is silence. Yet it has to be proven that these trusts have infringed the law.
In the case of the Racing Trust there is no doubt. There is none to deny that it is an absolute monopoly. It conducts business in open defiance of the law and the Constitution. It has the avarice of a miser, and the impudent shamelessness of a courtezan. All who will help to fill its maw are received with open arms. Lacking morals, it expects none of its patrons. Within its portals the scum of humanity is made as welcome as the cream. It has its rules, but these are without and beyond the law, though, curiously, they are enforced by so-called guardians of the law. The Beef Trust, by its rapacious methods, may make vegetarians; the Racing Trust makes outcasts, who, sometimes, rise to the dignityof convicts. The Beef Trust shuns advertisement; the Racing Trust welcomes it. Any reputable undertaking must pay heavily for the support of the press; the Racing Trust gets such support in columns per day for a ridiculously small subvention. The press poses as a teacher of morality. In the case of the Racing Trust it plays the part of a panderer without getting the price insisted upon by that unutterable in any other walk of life.
Americans believe that they possess a quality of humor that is far superior to that which bears the hall-mark of any other nationality. ’Tis a comfortable belief, for it enables them to live cheerfully under conditions which would not be tolerated elsewhere. There are several kinds of humorists among us, and of these the men who make inadequate laws, or laws which they know will be broken, and the men who break them and go unpunished are worthy of more and of a different sort of attention than they receive. People growl at the Beef Trust on account of the high prices of beef, though Mr. Garfield, who was instructed by the President to investigate that Trust, has said that its profits are only moderate.
What of the profits of the Racing Trust? Monte Carlo is described invariably as the most delectable gold mine in the world. In ordinary gold mines the vein may be “pinched out”; in Monte Carlo it runs on forever. Games made by gamblers for gamblers are called games of chance. There is little humor in your gambler, else he would recognize the absence of chance. Many thousands have tried to “break the bank” at Monte Carlo. Nobody has succeeded, for while play is conducted there honestly, the games are of the “sure thing” variety, as the percentage is always in favor of the bank. But the shareholders of the Casino at Monte Carlo are satisfied with twenty per cent. per annum on their investment and, sometimes, get less. And let it be remembered that in conducting their business they do not break the law.
The Racing Trust would scorn to accept anything so paltry as twenty per cent. on its investment, yet it is a law-breaker for seven months of the year, on six days of the week, and in the course of time, doubtless, will break it on the seventh day of the week also.
Laws against gambling have existed from time beyond count, just as they have existed against murder and other crimes against public welfare. The Constitution of the state of New York prohibited all kinds of gambling until 1887. In that year the Legislature passed the “Ives Pool bill.” Ives was a member of the Legislature from this city. Except that he piloted this particular bill through a legislature which was paid to adopt it, his name would have been forgotten. The bill called by his name suspended the provisions of the Penal Code relating to gambling at race-tracks. It limited racing between May 15 and October 15. It limited racing upon any track to thirty days. It permitted bookmaking upon the tracks. In return for enormous privileges the racing associations were to pay to the state five per cent. of their gross receipts. The law confined gambling to the tracks, and in order to take full advantage of it, and also, of course, to improve the breed of racing stock, philanthropists of the convict stripe opened tracks where racing was conducted at night as well as by day, in winter as well as in summer. The manner in which racing was conducted became a public scandal. The horse was the principal factor, and, generally, was used as a means to an end. There were, of course, owners and trainers and jockeys who were honest, even under the Ives Pool law, but these were very much in a minority. The “sport” reeked with dishonesty. Horses were “pulled,” trainers and jockeys were “stiffened.” Some of the racing officials not only winked at “crookedness,” but took part in it. Unless the starter of those days had a piece of every “good thing,” it did not “come off” if he could prevent it.None talked of the improvement “of the breed” except with tongue in cheek. “Jobs” were discussed, after the event, as if they had been meritorious performances. When these were the work of trainers and jockeys the bookmakers were derided; when they were planned and realized by bookmakers the latter were cursed. There was much cursing in those days, as there was much reason for it, but the profanity was not due to the failure of honest, but dishonest effort. Women as well as men were allowed to bet, and the race-tracks were hotbeds of debauchery. The great body of those who were interested in racing was beyond the pale. The refuse of the country camped in New York while the orgy lasted, and so obnoxious did these bandits make themselves that an organized effort was made to induce the constitutional convention which met in 1895 to cleanse the state of the filth which was bred by the Ives Pool law.
This convention appointed a committee, whose duty it was to prepare an address to the people of the state. The address dealt with the work of the convention. The committee called attention to the anti-gambling amendment adopted by the convention in the following language: “The passion for gambling to which the system of lotteries formerly ministered has found fresh opportunity under the so-called Ives Pool bill, and, under color and pretext of betting upon horse races, is working widespread demoralization and ruin among the young and weak throughout the community. We have extended the prohibition against lotteries so as to include pool-selling, bookmaking and other forms of gambling. It is claimed that this provision will array in opposition to the proposed Constitution a great and unscrupulous money power; but we appeal to the virtue and sound judgment of the people to sustain the position which we have taken.”
This address was signed by Messrs. Joseph H. Choate (Ambassador to England), Elihu Root, H. T. Cookinham, Elon R. Brown, Chester B. McLaughlin, Milo M. Acker, Daniel H. McMillan and M. H. Hirschberg.
The anti-gambling amendment, which was adopted by the convention with only four dissenting votes, was as follows:
“The delegates of the People of the state of New York, in convention assembled, do propose as follows:
“Section 10 of Article I of the Constitution is hereby amended so as to read: ‘No law shall be passed abridging the right of the people peaceably to assemble and to petition the Government or any department thereof; nor shall any divorce be granted otherwise than by judicial proceedings;nor shall any lottery or the sale of lottery tickets, pool-selling, bookmaking or any kind of gambling hereafter be authorized or allowed within this state, and the Legislature shall pass appropriate laws to prevent offenses against any of the provisions of this section.’”
The “great and unscrupulous money power” to which Mr. Choate and his associates alluded was that of the racing associations. Their power was felt in the convention, and some of those who discussed the amendment prior to its adoption claimed that it was offered at the suggestion of one set of gamblers (poolroom keepers) against another set of gamblers (the racing associations). This was true enough. The racing associations were as grasping then as they are now. Their members claimed that the poolroom was a nefarious and demoralizing influence. Why? Because it prevented the racing associations from having a monopoly of the petty as well as the big gamblers’ money—of the cash of those who had not time to go to the races as well as of those who were unable to go. The engines of the law were stoked up and run full tilt against the poolrooms at the behest of the racing associations; therefore, in self-defense, the poolroom keepers were anxious that all gamblers should be placed on the same level; hence the anti-gambling amendment to the Constitution. Mr. Telusky, who offered the amendment as a resolution, said that if any member of the convention“can name one man in the state of New York that is in the bookmaking business that is not a thief, a blackguard or an ex-convict, I will withdraw my resolution. I say, Mr. President, every bookmaker in the state of New York, no matter where he comes from, is nothing but an ex-convict, a cracksman, a pickpocket, a thief of the lowest character, and these men come here and desire to shut this (amendment) out because the Legislature of a few years ago legalized a certain kind of gambling, and they are trying to protect them.”
Mr. Edward Lauterbach paid his compliments to the racing associations in plain language. “Their nefarious establishments,” he said, “have been erected from Montauk Point to Niagara Falls, and the state treasury has received and distributed to the county fairs a few miserable shekels, which it has reserved as its share of the plunder.Why, for every dollar that the state has received, it has expended ten dollars to support those who have become inmates of its prisons by reason of the weak policy so pursued.You are all familiar with the terrible temptation of this alluring vice. The passion of gambling is pandered to in this fashion in the most insidious manner. Exaggerated accounts of great winnings are presented to the readers of every journal. Tens of thousands of young men and women have been hurled to their ruin through the instrumentality of the state that should have protected them. Gambling has already been made unlawful. If anyone desires to legalize any one branch of gambling by the suggestion of proposed amendment (to the anti-gambling amendment), let us say to him, Never. Let us pass this amendment, so that, once enacted into a law, it may carry out its beneficent purpose and not prove a sham and a deceit. Just as it was as reported let us have this amendment—no subterfuge, no change, no alterations; make no halfway work. Sweep the whole brood together—gamblers, pool-sellers, bookmakers, all the racing fraternity—into oblivion forever. Pass this amendment now, as it is, unaltered and unchanged. True horse fanciers—the Bonners, the Lorillards, the Belmonts, the Keenes and the rest—will thank you for the protection you thus afford to their legitimate pursuit. Only the gambler, who should be a pariah and an outcast, and not the state’s associate, will have cause for regret.”
It was said at the time that the racing associations and the bookmakers had collected a fund of $700,000, and intended to use it in buying enough votes in the convention to defeat the anti-gambling amendment. Who said it? The newspapers. True? Not at all likely. The racing associations were able to raise such a fund, but would have got little assistance from the bookmakers. The latter were an asset of the racing associations and knew it; they must be taken care of. ’Twas said, when Mr. Jerome was at Albany championing the Dowling bill, that the gamblers of New York had contributed $100,000 for the purchase of the Black Horse Cavalry in the Legislature. The press gave Troy as the headquarters of the gamblers’ committee. There was no such committee. The gamblers of New York, including Canfield, who had more at stake than any other gambler, did not contribute a dollar for the purpose of killing the Dowling bill. The latter was passed with surprising ease in Assembly and Senate, and had become a law before the “clever division” had begun to think of the possibility of such a result. This law, in the hands of Mr. Jerome, has proved rather embarrassing to the gambling fraternity, and may give him an opportunity of distinguishing himself in a manner after his own heart before many weeks have passed.
The anti-gambling amendment to the Constitution was ratified by a popular majority of nearly 90,000 votes. Some of the voters believed, doubtless, that it would eliminate betting on race-tracks. These forgot that the amendment was of little worth unless the Legislature made such gamblingan offense and also made a punishment to fit the offense. The Legislature which followed the adoption of the Constitution was “open to reason.” How much money was required to salve its conscience I do not know, but the manner in which it replied to the demand of the popular vote shows that it was dishonest. By the anti-gambling clause of the Constitution it was ordered to “pass appropriate laws to prevent offenses against any of the provisions of this section.” Instead of obeying such mandate it adopted the Percy-Gray law, which makes gambling in poolrooms a felony and gambling on race-tracks a misdemeanor. In other words, if the keeper of a poolroom takes a bet on a horse race he commits a felony and can be sent to jail, for according to the law he has committed a penal offense, whereas if a bookmaker accepts your money on the same race he does not commit a felony and you are at liberty to publish yourself as a poor sort of creature by attempting to recover your money by civil action. Class legislation? It looks like it. But class legislation is unconstitutional. That is the general opinion, but in this particular case many thousands of dollars have been spent in an effort to discover whether or not the present racing law is unconstitutional, and the dollars have been thrown away.
The situation would be amusing did it not demonstrate the power of money. To the average mind it would seem as if the constitutional convention had barred all kinds of gambling, particularly gambling on race-tracks. Yet, under the fostering care of the Racing Trust, the volume of gambling at race-tracks is at least thrice as great today as it was in 1895. Before the convention met the Racing Trust was permitted to do business for five months in the year; now it does business for seven months. Under the Ives Pool law, which was wiped out as vicious, the tracks were limited to thirty days of racing; now the Jockey Club does as it pleases in the matter of dates. Under a law which is, upon its face, unconstitutional because it discriminates, the Racing Commission, a state institution, has the power to issue or refuse licenses. The Racing Commission is under the control of the Jockey Club, and the latter is the ruler of the racing associations. The Jockey Club, of which Mr. August Belmont is the head, is lord of all it surveys in the metropolitan circuit, to say nothing of the Bennings race-track, in which a majority of the stock is owned by Mr. Belmont. Racing began at Bennings on March 23, and its dates are not included in the seven months of racing in the metropolitan circuit.
In this circuit there are seven tracks, not counting the Buffalo track, which is controlled by the Racing Trust. The track at Morris Park, the most picturesque race-course in the United States, has been relegated to obscurity, as it was not owned by the Racing Trust, but was leased at an annual rental of $45,000. Belmont Park, which is owned by Mr. August Belmont, the head of the Racing Trust, has taken its place. The associations which are controlled by the Racing Trust are capitalized as follows:
These figures were obtained from the Secretary of State, the Hon. John F. O’Brien. In any calculations that may be made the capitalization of Belmont Park should be eliminated and the rental of Morris Park, $45,000, substituted for $1,500,000, in order to show how thriving a concern the Racing Trust is. It will be understood, of course, that the capitalization of these concerns may be a trifle, just a trifle, higher than the actual value of the said tracks and appurtenances, except in the case of the Saratoga track, which was built solely “for the improvement of the breed of horses.”
For the right to do business on these tracks the Racing Trust pays, or is supposed to pay, to the state five per cent. upon the gross earnings of said tracks. Among the duties of the Racing Commission is the supervision of these receipts. The commission consists of Messrs. August Belmont, John Sanford and E. D. Morgan. Mr. Belmont is the president of the Westchester Racing Association (Belmont Park), and the largest owner of stock in the Racing Trust. Mr. Sanford is the power at Saratoga, and does not race until the season opens at the Spa. Attached to the Racing Commission is a State Inspector of Races. Until he was appointed to a position in the Internal Revenue Department the place was filled by Charles W. Anderson, a colored man. Reports of gross receipts are made to the State Comptroller by the racing associations and by the State Inspector of Races. It is not impossible that the latter official takes such figures as are offered to him, and it is difficult to imagine that he ever objected to them on the score of inaccuracy or any other score.
The reports of gross receipts made by the members of the Racing Trust to the State Comptroller for the years 1900, 1901, 1902, 1903 and 1904 are as follows (the figures were obtained from the State Comptroller, the Hon. Otto Kelsey):
The reader will notice the exactness with which the racing associations make up their gross receipts—the “twenty cents” of the Coney Island Jockey Club, the “nine cents” of the Saratoga “Association for the Improvement of the Breed of Horses,” and so on. The reader will notice, also, that the gross receipts for last year were $209,215.37 less than those of 1903, though the press was unanimous in declaring that last year’s racing was the greatest, which means the most profitable of all years. The five per cent. paid to the state last year by the Racing Trust amounted to $190,256.27. This five per cent. is “the penny in the dollar” alluded to by Mr. Edward Lauterbach in his address to the constitutional convention. But ridiculously small as it is, why does the Racing Trust give it to the state? Simply as a sop to the rural legislator and his constituents. The dweller in cities may lack some or many of the virtues, but when it is necessary to find the highest plane of parsimonious hypocrisy one must needs pay a visit to the rural districts. This five per cent., which smacks so much of Iscariot’s thirty pieces of silver, is divided among such agricultural societies as give annual fairs, and to farmers’ institutes. Ostensibly it is intended for the improvement of agriculture; in reality much of it is given as purses for trotting races at the said county fairs. Without the support of the rural element the Racing Trust would not have succeeded in getting the adoption of the Percy-Gray racing law.
The profits of the Racing Trust are enormous. Take the Coney Island Jockey Club, for instance. Mr. Leonard Jerome, who was a sportsman who never made money out of sport, built the Sheepshead Bay track at a cost of $125,000. The grounds of the Coney Island Jockey Club belong to the people and were filched from them by an act of the Legislature. Improvements were made since the track was built, but the actual legal belongings of the Coney Island Jockey Club are worth far less than the amount of the capital stock, which is $525,000. The gross receipts of the club for last year, as reported to the State Comptroller, were$854,421.20. Of what did these consist? It was said that the attendance on “big days” last year numbered from 40,000 to 50,000. Put it at 35,000, and the money taken in for admission, boxes and clubhouse seats and boxes and for “field” admissions would amount to about $80,000. Then there are the bookmakers. On more than one day last year there were 120 members of the Metropolitan Turf Association in the ring. They paid $57 each for the privilege of “laying the odds.” Back of them were a hundred layers who paid $37 each. There were fifty others who paid $27, and as many more who paid $17 each. Programs to the number of 40,000 at ten cents each make $400. Then there are the bar and restaurant privileges, the commissioners and many other means of income, so that the income of one such day could not be less than $100,000.
There were thirty days of racing at Sheepshead Bay last year. The attendance, according to the daily press, was “enormous,” “record-breaking,” “large” or “highly satisfactory.” The “highly satisfactory” days were the smallest of the season, which shows the difference between English as it is understood by “sporting” writers in the daily press and those who are able to distinguish the difference between fact and fancy. If the average daily attendance were not more than 12,500, it and the other sources of revenue would mean about $35,000 per day.
The sum of $10,000 per day will cover all the expenses, including added money, at Sheepshead Bay. According to such calculation and taking the club’s figures of gross receipts as correct, the result would be like this:
These figures show that the profits of the Coney Island Jockey Club forthirty daysof racing are more than the full amount of its capital stock. Some years ago, when racing was conducted on a smaller scale, this stock paid 56 per cent. per annum. Unless a lot of money is packed away in a reserve fund, the stock should pay dollar for dollar now, and the state still gets the “penny in the dollar.”
Much of the income was contributed by the chief factors at a race-course—the men who own and race horses; and one of the most interesting features of a race meeting, to members of the Racing Trust, is the fact that the men who own the horses are racing for money contributed, in great part, by themselves. The money added by the racing associations is often less than the amounts furnished by owners of horses that have been entered for a race. Much stress is laid upon the fact that $2,601,160 was won in purses last year on the tracks of the metropolitan circuit and Bennings. This amount, large as it may seem, was so distributed that very few owners paid much more than expenses, while a far larger number lost much money. Four hundred and thirty-eight stables or owners were among the winners, and a glance at the following table will show that the losers were in a large majority.
OWNERS AND WINNINGS
In addition to the foregoing, 155 stables won between $1,000 and $7,000 each. Some of these stables had as many as a dozen starters who “figured in the money.” Stables or owners to the number of 217 won between $100 and $1,000 each. Of this number fifty-four were in the $100 class. The average winnings for the 438 stables were $5,938, which sum tells a doleful tale for a majority of them, as the expenses of one thoroughbred and its owner for a year cannot well be squeezed into $5,938, unless the horse’s diet is restricted to hay and the owner lives at a Mills hotel. Mr. Keene’s winnings were $164,940. That amount about paid his racing expenses for the year.
All of which, I think, goes to prove that the Racing Trust is more anxious to make and increase enormous profits than to improve the breed of horses. And everybody is aware that such enormous profits are made only by violation of the Constitution of the state, and that, while gambling in poolrooms and elsewhere has been made difficult and dangerous, no effort has been made by the authorities to interfere with it on the tracks of the Racing Trust.