Part 36

“Your problem now,” I told them, “is to do business. As far as laws can insure it you have free opportunity; but good laws and free opportunity alone do not build up a business. Unless you can be as efficient and as patient, as farseeing as your great competitor—laws or no laws, you will not succeed. You must make yourselves as good refiners, as good transporters, as good marketers, as ingenious, as informed, as imaginative in your legitimate undertakings as they are in both their legitimate and illegitimate.”

My speech was not popular. What they wanted from me was a rousing attack on the Standard Oil Company. They wanted a Mary Lease to tell them to go on raising hell, and here I was telling them they had got all they could by raising hell and now they must settle down to doing business.

“You have gone over to the Standard Oil Company?” said one disgusted Populist.

I saw I had ruined my reputation as the Joan of Arc of the oil industry, as some one had named me. But there were hard-headed independent legislators and business men in the state who consoled me, “You are right, we must learn to do business as well as they do.”

One immediate national effect of the Kansas disturbance was to arouse the legislatures of other oil-producing states in the Southwest to enact laws not unlike those of Kansas, though I do not remember that a state refinery was sponsored anywhere else. There was a wide demand that Congress place the pipe-line system under the Interstate Commerce Commission, subject it to the same restrictions as interstate rails, but most important was the fine popular backing the row gave the trust-busting campaign of Theodore Roosevelt, now President of the United States. He had begun his attack on big business by putting an end to the first great holding company the country had seen—the Northern Securities Company. He had followed this by a bill establishing a department for which people had been asking for a decade or more, that of Commerce and Labor, including a Bureau of Corporations with power to examine books and question personnel. Congress at first shied at the measure, but Mr. Roosevelt thundered, “If you do not pass it this session I will call an extra session.” And they knew he would.

Ironically enough it was the Standard itself that broke the reluctance of Congress. The proposal had shocked it out of its usual discretion. There never was an organization in the country which held secrecy more essential to doing business. Breaking down the walls behind which it operated was not to be tolerated. It seems to have been the peppery John Archbold who took charge of the fight against the bill, using all the political influence of the company, which was considerable at that moment.

Roosevelt soon learned something of what was going on—it is not certain how much; and when he saw his measure in danger he gave out the statement that John D. Rockefeller had wired his friends in the Senate, “We are opposed to any antitrust legislation—it must be stopped.”

The last thing in the world that John D. Rockefeller would have done was to send such a telegram to anybody. Probably Mr. Roosevelt knew that; but somebody in the Standard was passing on such a word, and Mr. Rockefeller was the responsible head of the organization. His name did the work. Congress passed the bill in a hurry. The Bureau of Corporations was speedily set up, an excellent man at its head—James Garfield. The first task assigned it by the President was an investigation of the petroleum industry.

This investigation reported in 1906 that the Standard Oil Company was receiving preferential rates from various railroads and had been for some time. One of the most spectacular business suits the country had seen up to that time followed. The Standard was found guilty by Judge Kenesaw Landis, the present arbitrator of the manners and morals of national baseball, and a punishment long known as the “Big Fine”—twenty-nine million dollars—inflicted. The country gasped at the size of the fine, but not so the Bureau of Corporations. My correspondent there contended that over eight thousand true indictments had been found, and that the maximum penalty would have amounted to over a hundred and sixty million dollars!

But even the twenty-nine million dollars, so modest in the view of the Bureau of Corporations, was not allowed to stand, for in 1908 Judge Peter Grosscup of the Circuit Court of Appeals in Illinois upset it. Roosevelt was angry. “There is too much power in the bench,” he told his friends.

But by this time the Government had under way another and a much more serious line of attack, from which Roosevelt was hoping substantial results. Back in 1890 the Congress had enacted what was known as the Sherman Antitrust Law, a law making illegal every contract and combination restraining trade and fostering monopoly. The Government was now seeking to apply this law to the Standard Oil Company. Was it not the first industry to attempt monopoly? Had it not been the model for all the brood?

Such a suit was no new idea. Independent oilmen had long talked of it, and in 1897 they had been ready to go ahead when at the last moment the lawyer to whom they had entrusted their case was taken suddenly ill and died. It must have seemed to the energetic Lewis Emery, Jr., who had been engineering the attack that the Lord himself had “gone over to the Standard.”

Ten years went by, and then in September, 1907, the United States of America began suit against the Standard Oil Company of New York et al. There were months and months of hearings. If I had been a modern newspaper woman I could have made a good killing out of that long investigation, for more than one editor asked me to analyze the testimony as it came along or give my impressions of the gentlemen who appeared on the witness stand. But I had no stomach for it; I never attended a public examination though I of course read the published testimony with care.

I knew well enough that the time would come when, if I did my duty as a historian, I must analyze the suit; but that must be after it was ended and a sufficiently practical test had been made of the decision. It would be a long time, I told myself, before I should be obliged to take up the story where I had left it.

13 OFF WITH THE OLD—ON WITH THE NEW

Twelve years had gone by since I tied myself, temporarily as I thought, to the McClure venture. To my surprise, the longer I was with the enterprise the more strongly I felt it was giving me the freedom I wanted, as well as a degree of that security which makes freedom so much easier a load to carry. Here was a group of people I could work with, without sacrifice or irritation. Here was a healthy growing undertaking which excited me, while it seemed to offer endless opportunity to contribute to the better thinking of the country. The future looked fair and permanent.

And then without warning the apparently solid creation was shattered and I found myself sitting on its ruins.

Looking back now, I know that the split in the McClure staff in 1906 was inevitable. Neither Mr. McClure nor Mr. Phillips, the two essential factors in the creation, could have done other than he did. The points at issue were fundamental. Each man acted according to an inner something which made him what he was, something he could not violate.

Back of the difficulty lay the fact that at this time Mr. McClure was a sick man. The hardships of his youth and early manhood, the intense pressure he had put on himself in founding his enterprises had exhausted him. For several years he had been obliged to take long vacations, usually in Europe with his family, his staff carrying on his work in his absence. The enterprises were bringing him larger and larger returns and more and more honor; but that was not what he most wanted. He wanted to be in the thick of things, feel himself an active factor in what was doing. Above all he wanted to add to what he had already achieved, to build a bigger, a more imposing House of McClure.

“What he wanted was more money,” I have heard men comment.

They were wrong. I have never known a man freer from the itch for money as an end than S. S. McClure. Money for him meant power to do things, to build, to help others. On his way up he had gathered about him a horde of dependents with whom he was always ready to share his last dollar. He was reckless with money as with ideas.

In these years when he was practically living in Europe, though returning regularly to the United States, his chief interest was not in what his enterprises were accomplishing, but in adding something bigger than they were or could be. Only by doing this could he prove to himself and to his colleagues that he was a stronger and more productive man than ever. Nothing else would satisfy him.

His passion to build, to realize his ambitions, made him careless about laying foundations. What he did usually had the character of improvisation, frequently on a grand scale, sometimes merely gay spurts of fancy. I was myself caught in one of the latter when Mr. McClure in London suddenly ordered me in Paris to drop whatever I was doing and to hurry into Germany to collect material for an animal magazine.

Animals were an abiding interest with McClure’s. Rudyard Kipling laid the foundation in the Jungle tales. After that great series few were the numbers that did not have an animal in text and picture. It was as much a passion as baseball was to become in the latter days with The American Magazine.

I spent a lively month visiting zoos, interviewing animal trainers and hunters and keepers, buying books and photographs, turning in what I considered a pretty good grist of materials and suggestions. What became of it, I never knew, for I never heard a word of it after I came back to America. The only remnant I have now of that month is a powder box of Dresden china bought at the showrooms of the factory of the crossed swords, it being my practice when on professional trips to use my leisure seeing the town, guidebook in hand, and buying all the souvenirs my purse permitted.

It was in 1906 that Mr. McClure brought home from one of his foraging expeditions the plan which was eventually to wreck his enterprises. He had it cut and dried ready to put into action. Without consultation with his partners he had organized a new company, the charter of which provided not only for a McClure’s Universal Journal, but a McClure’s Bank, a McClure’s Life Insurance Company, a McClure’s School Book Publishing Company, and later a McClure’s Ideal Settlement in which people could have cheap homes on their own terms. It undertook to combine with a cheap magazine—which it goes without saying was to have an enormous circulation with the enormous advertising which circulation brings—an attempt to solve some of the great abuses of the day, abuses at which we had been hammering in McClure’s Magazine. He proposed to do this by giving them a competition which would draw their teeth.

By the time Mr. McClure got around to explaining his plan to me and asking my cooperation he had worked himself up to regarding it as an inspiration which must not be questioned. It seemed to me to possess him like a religious vision which it was blasphemy to question. Obsessed as he was, he was blind and deaf to the obstacles in the way. I am sure I hurt Mr. McClure by telling him bluntly and at once that I would never have anything to do with such a scheme.

In a recently published letter Lincoln Steffens tells how he saw Mr. McClure’s plan. To him it was not only “fool” but “not quite right.” Certainly it was not right. As organized, it was a speculative scheme as alike as two peas to certain organizations the magazine had been battering.