CHAPTER I

THE SIBERIA OF FINANCE

      This is a true story of fifteen years of persecution; a battle day by day for the right to live and create; a battle with the unfair and destructive methods of the so-called Money Trust, and I can assure my readers that no sufferers in Siberia are more deserving of your sympathy than those who are being daily sentenced by the Money Trust to the Siberia of Finance.

   There may be no chain gangs.  They may not travel in cattle cars nor walk thousands of miles in the snow, but the Money Trust is as autocratic and wields as great a power as the Czar of Russia, and the Siberia to which I have been sentenced at their command has given to me and many others as great mental and physical suffering as the Siberia of Russia. 

   You may ask:  Why have I persevered against unfair conditions?  Because I have great faith  in the ultimate triumph of right, and I believe that the nation that removed the curse of the pirates of North Africa, and freed the slaves of the South, can be relied upon sooner or later to break these fetters forged by the Money Trust, and set free men like myself -- who dare work for the up building of their nation.

   Not many experiences like mine can be found, because few men have the physical strength, patience and power of endurance which seems to have been my birthright, and has enabled me until now to jump every hurdle put in my path.  In writing and publishing of this book, I have no desire for revenge -- revenge is baggage that I never carry -- but I do desire to see the great work started by William Jennings Bryan in Baltimore, at the Democratic Convention, carried out, and a President in the White House with no entangling alliances, with a Congress and Senate so powerful that it can, if the President wishes it, once and for all end the injustice of the Money Trust, and no longer allow the Comptroller's office to be a tool whereby Wall Street may call the loans of any man they wish to ruin.  I hope, if the Democratic Party is victorious in the next election, that it will pass laws making the profession of the assassinating American business and business men rank with manslaughter, which it has often proved to be.

   I will give you an example:  When the American Sugar Refining Company, through Messrs. Havenmeyer and Kissell of the Wall Street Banking House, closed the Siegle refinery in Philadelphia, it brought with it the failure of one of the great Trust Companies of Philadelphia; the Vice-President committed suicide, and the papers state that the failure of the Trust Company caused numerous deaths from financial loss and worry.  This is only one case.  There are others.  If certain men in New York had kept their promise, the Knickerbocker Trust Company would not have failed, nor its President, Mr. Barney, committed suicide.

   I prefer to have the McNamaras blow up my building with dynamite than to have my property taken from me by the unprincipled methods of the Money Trust.  In the first case, I have my lot left and can rebuild -- while the cruel methods employed in the second case not only destroy the property, but often health and reputation.  Why should it be that in case a poor man destroys my building with dynamite I have the entire legal machinery of the nation to bring him to justice, but if my business is destroyed by a combination for rich men, and my stockholders lose millions, there is no way that I can bring these men before the fight or say one word in my favor, for they well know if they do the black hand of the Money Trust will then be turned against them?  What I say  regarding the press is absolutely true.  I have the highest regard for newspapers and appreciate their high sense of justice, but know full well that for any newspaper in any way to undertake to fight my battle would mean ruin for that paper.  It would first lose all its financial advertising, then the large department stores and others would find that they could not rediscount their paper as before, and it would be intimated that as long as they continued to advertise in such and such a paper they could not expect the usual banking credit.  I have had a number of talks with newspaper men, and they say;  "Stilwell, we have watched your persecution and unequal fight, and  know that all you say is true, but we are helpless to aid you."  And I know that when when this book is published any number of papers will be forced to comment unfavorably, and do all they can to ridicule it and my work.

   Let us contemplate the unjust conditions as they exist.  The rich man is separated from his deeds; his deeds only go before the bar of justice.  The poor man is tried alone for his deeds.  The Standard Oil Company is convicted of breaking the Sherman Law, and the evidence proved conclusively that they certainly broke the laws of justice and humanity in the conduct of their business.  The acts of the officers and directors were brought to trial -- not the officers and directors.  The McNamaras blew up buildings, and the McNamaras were tried -- not the buildings that they blew up.  Had one of the agents of the Standard Oil Company destroyed the building, the case, I suppose, would then have been:  was it a ruined building or was it not?  The question as to who did it would probably not have been considered by the court.  The absolute lack of feeling that these financial cannibals show would leave one to think that they were suffering from a disease as dangerous as rabies -- a disease that had deadened all finer feelings and sense of right to such an extent that nothing but the dread of a penitentiary sentence would cure them. 

   A few years ago I had a conversation with a leading official of the Standard Oil Company.  He was a grand old man, a church member, and charitable, but he had been educated in this Standard Oil School (or school of no standard), and had I no known him so well I would have  inferred by the story he told me that he had never heard of the Golden Rule.  I will give you his story as nearly as i can, word for word.  I started the conversation by saying;  "I suppose it is useless for anyone to attempt to sell oil against such an organization as your company."

   I seemed to have touched the one inhuman trait in his character, and he smiled and rubbed his hands as i imagine the old pirates of Tarifa, Spain, did when they came ashore with a big loot, after holding up some merchant ship.  "Well," he said, "Stilwell, it is quick work putting them asleep.  I had a man in our Cincinnati office who had saved about one hundred thousand dollars; he found out that the Standard Oil had practically no trade in one of the Southern States.  (I think he said Alabama.)  He resigned from our employ, moved down there, and in three years built up a business that netted him between forty and fifty thousand dollars per year.  Oh, he was a good hustler," my friend said, "and we made up our mind that we wanted his business.  I offered him two hundred thousand dollars to sell out, and what do you suppose!  He had the nerve to refuse it.

   "Well, I put in a system of oil wagons and sold oil at one cent per gallon less than it cost him to get it.  The next year I sold at two cents less than it cost him to get it.  He was a good fighter, and met our prices.  But it as useless.  No one would lend him money or help him, although he tried in every way to get financial aid.  They knew we were after him and would get him in time.  We cleaned him out in a little over two years.  Such a fool not to sell out for the two hundred thousand that I offered him!"

   The story was related with very evident satisfaction, but a shiver ran down my spine.  I had trod that road of suffering.  I plainly saw that man working all his life saving and struggling for what he had.  With his business  acumen he saw the possibilities in this territory that was not occupied by the Standard Oil.  He no doubt thought, as I used to think, that this was the land of the free, and started in to use his God-given abilities in the direction and business that he so well understood.  Then he saw the business grow -- what a pleasure to know that the little family would have all that he in early life had planned and hoped for them!  Then comes the offer that he feels justified in refusing, followed by the years of suffering -- the loss of his entire capital; broken-hearted, and perhaps too late to start life a second time (as I did), and only disappointment and poverty to await him in his old age -- all from no fault of his, only on account of the hungry maw of these business cannibals that live on the blood of others.

   Ask why this man failed, and they will no doubt tell you (as they generally do in my case) that he was not careful and conservative, and was extended in all directions.  These destroyers of American business men attend to all details.  They even have some one to send out the proper obituary remarks about those whom they have devoured. They also control the commercial agencies.  They sent a man to Europe this year to destroy the confidence of my friends.  There is nothing neglected by this system to make the ruin of their helpless victims complete.

   What I am telling you in this story is my own personal experience, but I want you to read the following, by Samuel Untermeyer in the New York  World of July 2, 1912:

   "Whether the so-called money trust inquiry shall be continued depends largely on the fate of the pending bill to amend the banking law that has passed the House and been hung up two months in the Finance Committee of the Senate.  If the big financial interests opposing the inquiry can prevent action on the bill by misrepresentation or by the exercise of their secret power it will be killed.  They don't appreciate the way the inquiry was begun.  In fact, they are protesting loudly that it is being conducted in an injudicial way, which means that they realize that it will not be innocuous, but will develop hidden facts.
   "I believe these gentlemen are mistaken in boasting that they can kill the inquiry either by having Congress withhold funds or by throttling the necessary legislation.  The time for that sort of thing has passed.  We are entering upon a new era in government, and legislators who want to stay in public life are taking due notice of that fact. 
   "The committee has not touched upon the vital subject, and cannot do so until its powers are enlarged.  my acceptance of a retainer was expressly conditioned on this power being secured.
   "The committee has, however, developed some startling facts bearing on the existence, potency and growing concentration of the money power, already demonstrating the necessity for prompt remedial legislation.  It is impossible to analyze this important testimony within the compass of an interview.  It has been proven, among other things:

WHAT HAS BEEN SHOWN SO FAR

  1. That the Clearing House Committee of New York possesses and exercises arbitrary and irresponsible power over the finances of the country that is dangerous in the extreme and should be subjected to legislative and judicial control.  Around it gravitates the entire financial system of the country.

  2. That these men are in turn dominated by a few bankers whoa re not members of the Clearing House and not officially connected with its members.

  3. That it reserves the power to arbitrarily prevent the forming of new banks and trust companies and to prevent all competition by refusing its privileges of membership, without which business cannot be successfully done.

  4. That under its self-constituted regulations it can ruin any solvent banking institution by withdrawing clearance privileges without notice, reasons or redress.  Its opportunities for favoritism and oppression are endless.

  5. That in a panic it destroyed a number of solvent banks that would have been saved under a proper system responsible to legal control. Those banks, after being put out of business by the action of the Clearing House Committee, paid their depositors in full even in liquidation and had a surplus of from $50 to $150 per share for the stockholders.

  6. That ninety-four banks and trust companies that are members of the Clearing house or amenable to its rules have been compelled under penalty of expulsion and ruin to become parties to a criminal conspiracy whereby they were deprived of independence in dealing with customers and were required to make uniform excessive charges for collecting out-of-town checks amounting to an annual tax of many millions of dollars upon the business of the country.  Until this regulation was put into force it was customary to make such collections without charge, but this is now forbidden under severe penalties.

  7. That the association maintains a bureau of staff accountants who, acting under the direction of the committee, have the right to examine into the accounts and affairs of all the members.  Thus, the committee can at all times inform itself of all loans and collaterals, and is able to exercise a power to dislodge collateral that is dangerous to the community.

  8. The relations of the Stock Exchange to the country's financial system have been shown to some extent, but that, as well as the branch of the inquiry relating to the Clearing  House, is unfinished.

INFLUENCE OF THE PRESS

   "No investigation ever undertaken in Congress or by any government has been of such far-reaching importance.  If properly conducted, it should point the way to fundamental reforms in our financial and industrial systems, but it will require many months of laborious, painstaking investigation and the cordial aid of the community.  Above all, it will need the enthusiastic support of the independent press of the country to make known the true facts as developed and to offset the desperate efforts of men who dread the inquiry and are making through a part of the metropolitan press attempt to destroy its effect by willful misrepresentation, suppression of testimony or attempts to ridicule its importance.
   "The influence of these men over the press through vast advertising patronage and power to assist the speculations of the newspaper agents in the financial district is an important factor in this situation.  We have already felt its force in its garbled reports of the testimony of Vanderlip and others.
   "The policy of many papers has been dictated by financial needs.  Others run that way from choice.  There are only a few New York papers with the courage, independence and disregard of financial penalties that the World has shown in its attitude toward the investigation.
   "I am satisfied, however, that when the committee takes up the main branch of the inquiry the facts that will be developed and the precedent set by a few independent papers will force just treatment by the others.  The control of a part of the most important agencies not the least dangerous to the community."

   Now, please reread the above article, as I shall refer to it often, and I want to impress it thoroughly upon your mind.  Remember this statement of Mr. Untermeyer is the statement of a great corporate attorney of New York, chosen by the Congressional Committee to investigate the Money Trust as their attorney.  Read what Mr. Untermeyer says this Money Trust does to solvent banks in times of panic; then you will more readily believe what I am going to tell you of what they did to the Guardian Trust Company, of which I was President. They have no consideration for any one in their path.  The widow and orphan, the poor and the weak, are all trampled down.  In the Guardian Trust Company were many whose holdings represented their entire life's savings.  They had received regular dividends for years, as no trust company in Missouri had probably up to this time paid better dividends than this company.  But they were all robbed just to reach me.  Is is any wonder that some of the political parties are endeavoring to prove that none of the ill-gotten gains of "The System" were used in their former campaigns?  But we know that they were, and by this means these men received immunity from their misdeeds which have honeycombed the life of the nation.

   I sometimes have wondered if when Edward Harriman was dying in his partially completed palace at Ardmore, it added one jot to his peace of mind to think that he had for years deprived me of my rightful place as the upbuilder of Port Arthur, of which I was the creator; or that he had for five years controlled the destinies of the Kansas City Southern Railroad, which he had helped seize from me and my stockholders just as the last spike was driven.  And I wonder if his wife and children are any happier in the increased possessions which were gained in this way.  As I lately drove past Ardmore, I thought of that silent tomb and thanked God that I was the one who had been wronged and not the one responsible for the destructive work recorded in the coming chapters. 

   I wonder if when John Gates was dying in Paris and was told that he could live only a few days, did it make his pillow any easier to think that he had helped Harriman and others to take from me my Railroad and Trust Company as revenge for my refusal to help him steal from innocent people.  Both of these men died long before their time.  Both of them were useful men in the world.  They would have been rich enough if they had used only honest methods.  There is nothing to be gained by dishonest work.  Its seeming profits are only a delusion; such gain is really a loss.  It never can bring peace and happiness.

   You will read in the coming chapters on the Guardian Trust Company and the Kansas City Southern Railroad, how the committee, of which Messrs. Gates, Harriman and Thalman were the prime movers, broke promise after promise which they had made in print.  Not one of these men is alive today.  Such dishonest work starts a law of retribution which seems to shorten life, and if, as the Good Book says, "The sins of the fathers are visited upon the children even to the third and forth generation," what an inheritance!

   Notwithstanding the awful struggle which I shall relate in the coming chapters, a struggle which made my work sometimes almost impossible, and in the case of the Orient Railroad, made it cost millions more than it otherwise would have cost, practically all the companies that I have organized and started have been a success, have made big money, and their existence justified, and hardly a loss would have been recorded had it not been for the awful work of these financial cannibals.  You will read in this book of the needless receivership of the Kansas City Southern, the receivership being granted at midnight on a thirty-four dollar printing bill, the only object in bringing the receivership being to depress the securities.  You will also read of the receivership of the four Northern roads of which I was President, granted at two o'clock in the morning for the sole purpose of helping John Gates make money by the depressing of securities.  You will also read of the receivership of the Guardian Trust Company, a solvent company with no deposits, the receivership being asked for only to prevent my building the Orient Railroad.

   As Elbert Hubbard says:  "Few can pay the price of hemlock, and few deserve the Cross."  But when you finish reading this story of persecution, remember there are many others who could tell pathetic stories of business ruined by these millionaires, who, as Untermeyer says, "destroyed a number of solvent banks in times of panic," and who from the recent exposes in the papers we learn bought Congressmen, Senators, and almost controlled the President by their large contributions, knowing that owning the banking credit of the land as they did, any person whom they wished to destroy was helpless.  If this story of my suffering during these past years will blaze the way for freedom in this supposedly free country, and bring about a higher standard in business; if this story will help to impress upon our young men just entering the business world the value of the Golden Rule, my suffering will not have been in vain.

   When we went to war with the South, no white man was a slave.  The war was to free the colored man.  No great monopolies owned and controlled the business of the country, even in slavery days.  I loved to develop, and the great Southwest attracted my attention.  That section of the country had to have the constructive work of James J. Hill, and it was a national crime that we were not let alone to carry out this work unmolested.

   President Diaz said to me a few years ago:  "Senor Stilwell, I cannot understand how any nation can treat a great constructor in the scandalous way that your nation treats you.  Any other nation would respect and help a man who had done what you have done for your country.  I can assure you," he continued, "that a number of bankers have tried by personal interview and letters to get me to cancel your concessions and ruin your great enterprise.  While I am President, this shall not be done."  And he added:  "We have adopted the policy of burning the letters of your enemies and filing the letters of your friends."

   Before I commence this story of financial cannibalism, I want to give you a synopsis of my work so that you may keep it in your mind as you read the succeeding chapters, that you may decide what is the greatest asset of a nation, the man who builds cities, railroads, harbors, reclaims deserts and drains swamps, or these men who, as Untermeyer said, "destroyed a number of banks in times of panic."  The companies that I created and raised all the original capital for now employ about twenty thousand people, which means that at least eighty thousand people receive their living from companies which I created, the combined pay roll of which amounts to about thirty millions of dollars per year. 

   This is only a part of the benefit I have brought to mankind.  There, out on the Western plains, I could show you thousands of homes that I have been the pathfinder for.  Banks and business thrived where I had pushed back the cattle ranges, and this work of city building was done so quickly and quietly that it was like pulling a great carpet down over the West, with its cities and farms, to take the place of the boundless prairies, with their lonely cowpunchers and their herds.  It was a great, ennobling work, and Stilwell and Dickinson understood it, and from this work flowed great rivers of commerce and industry, their golden streams turned life into the wholesale and retail trade of the West, and from the benefit derived from this pulsating stream of commerce, buildings arose where none had been before, and stories were added to existing buildings.  But, on the other hand were men bent on ruin.  They ran Ruin Departments.  They had experts to track down and trip up all who did not pay tribute to them.  They had all the habits of civilization, but those habits only covered corrupt dealings and corrupt lives.  They thought all men had their price, and from the late exposes in the daily papers, they were, in the majority of cases, right. 

   The kings of old would often bury alive the people they objected to, cement them into the walls of their palaces, and take a few days at it so as not to shorten the pleasurable operation.  But theirs was a merciful plan compared with the plan of these financial cannibals.  No man can give you more accurate information than I can, and now as I read the letters of Mr. Archbold to Senator Penrose -- as I see the great amount of money contributed by these financial cannibals -- I understand how it as when I went to the Department of Justice and stated my case of persecution, that I was told that nothing could be done.  If it is true, as stated in the papers to-day by Senator Penrose, that the Southern Pacific gave one hundred thousand dollars to the Republican Campaign Fund; if it is true, as Senator Penrose says, that the Standard Oil Company gave one hundred and twenty-five thousand; if it is true, as President W. O. Allison of the National Reserve Bank told me, that the Standard Oil interests were going to ruin me, cannot you see how they fixed up the field?  Perhaps they thought when they gave these great fortunes it would enable them to slug Stilwell and Dickinson to their hearts' content, enable them to steal their roads, along with the other enterprises they might wish.  What show did we stand with our banking credit destroyed by the interlocking directors?  With their bloodhounds and spies, with their control of great offices, they had the map of our ruin complete.

   Out West were two men striving to help their nation, men who had lived clean lives, men who did not know the first act in the game of corruption.  In that golden West was a great empire needing development.  There were thousands of chances for the young men of the West to go into this new territory.  There cities would spring up; all would be benefited by this work that gave to all and took from no one.  On the other side were unprincipled men, men connected with great banks, with their roots of influence reaching all over the land; with hundreds of thousands of dollars they had bought Senators and Congressmen, and no doubt owned the United States Comptroller, or at least part of his force.  They had contributed perhaps a million in different ways to the party in power.

   They had in reality bought the United States as a private preserve.  They personally could not be molested.  Some of their companies the Government must proceed against, but they personally could not be hurt.  At least this much must be done or the people would rise up, and so the machinery of the Government was stopped, as this handful of rich men had interlocked their power and influence and practically debauched the nation that they might prey, not on the high seas, as the pirates did of old, but prey unmolested on any enterprise that they wished.  So what show had these two men out West, building this great road, adding millions to the wealth of the West, adding greatness to Kansas City, Wichita and other cities?  Ho could they work against men who had bought, with their corrupt money, the power of the nation for righteous government, and a nation with a hundred million clean-minded people fast asleep while a handful of men were moving back the hands of civilization a score of years, forcing men like Stilwell and Dickinson to drop their great work just as the golden dawn of success was brightening the sky of honest endeavor?

   After the above was written, I read the following in the American of August 23, 1912, a wonderful coincidence, as the ideas conveyed are the same as in my chapter, and is just what by experience I have found to be the case:

"The letters show the oil trust is the Government.  They show how the trust dictates appointments; how the trust directed the investigation of itself by a Government commission; how the trust assured the escape of witnesses in the inquiry; how the trust framed laws to be passed in the Senate for 'control' of itself and other corporations."

The following, from Frenzied Finance, by Thomas W. Lawson, so agrees with my ideas that I take the liberty of copying it:

"To Penitence:
       That those whose deviltry is exposed within its pages may see in a true light the wrongs they have wrought -- and repent.
To Punishment:
     That the unpenalized crimes of which it is the chronicle may appear in such hideousness to the world as forever to disgrace their perpetrators.
To Penitence:
     That the transgressors, learning the error of their ways, may reform.
To Punishment:
     That the sins of the century crying to heaven for vengeance may on earth be visited with condemnation stern enough to halt greed at the kill.
To Punishment:
     That public indignation may be so aroused against the practices of high finance that it shall come to be as culpable to graft and cozen with the law as it is lawless today to counterfeit and steal.
To Penitence:
     That in the minds of all who read this eventful history there may grow up a knowledge and a conviction that the gaining of vast wealth is not worth the sacrifice of manhood, and that poverty and abstinence with honor are better worth having than millions and luxury at the cost of candor and rectitude."

 

 

Arthur Edward Stilwell, Visionary

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