Chapter 3

I notice with surprise that Mr. Clews in his sketch of Wall Street dwells not at all upon the benevolent agency of that power during the Civil War. This is an oversight which I beg leave to supply. There has never perhaps been an instance in human history in which a great power has so ardently devoted itself "to the preservation of free institutions" as did Wall Street in that epoch of mortal agony. Then it was that Wall Street engaged in the patriotic work, first of destroying the national credit, then of buying it up at half price, then of converting it into a bonded debt to be perpetuated for a full generation, and finally of compelling the people to pay it in a dollar worth four times as much as the dollar with which it was purchased. It was a beautiful scheme of devotion and self-sacrifice the like of which history has never before recorded. It was a speculation which involved the life of the American Republic. The Union was on trial. All nerves were strained, and all hearts were torn. The nation was bleeding at every pore. Every freight-train that came from the front brought back its loaded boxes of dead. Fathers and mothers gathered at the station, and each received his own. The rough coffin containing the body of the patriot boy who had given his life for the flag was taken by the silent father and mother to its resting-place under the apple trees. All true men had tearful faces, and a stern resolve in the heart. And while _this_ was the condition of the nation and the people, the high-toned Wall Street was speculating on the life of the Republic. It bought and sold blood. It was a bull on disaster and a bear on victory. It established bureaus through which to falsify intelligence and to bring the nation to the verge of ruin. It had no compunction. It regarded the gore of battlefields as the rich rain and mould out of which its own harvest was to grow. The more blood the merrier. The more tears the richer the yield. The more war the more debt. The more depression of the national credit the more cheaply we shall be able to gather it up! The more grape-vine despatches the more distraction and the better opportunity for us. The more death the more millions. The more horror and devastation the heavier will be our coffers. The more the people groan the more we will shout. The more they die the more we will live. The more the flag is torn the more our damask curtains will flutter. The more liberty perishes and withers from the earth the more we shall plant ourselves and flourish and rule and reign over a nation that we have destroyed and a people whom we have enslaved. If Mr. Clews wishes any further outline of the history of Wall Street during our Civil War we shall be glad to contribute such a sketch as a reminiscence of a great fact which appears to be dim in his memory.

There is another almost fatal omission in Mr. Clews's article. He says but little about the principal work in which Wall Street, historically considered, has been engaged during the last thirty years. I do not like the way in which this great section of the "Past" of Wall Street is glossed over. During the period referred to, that institution has had one bottom purpose and one reason of action from which it has never deviated. This purpose, this reason of action, has been the perpetuation of the national debt and the increase of its value by bulling the unit of money in which the debt is payable. Wall Street knows that the bonded debt of the United States is the basis, or central fact, in the whole system of bonds and stocks. Wall Street knows that the dollar is the central fact in the bond. It knows that if the bond can be made everlasting and the dollar can be increased in value until a single unit of it shall be equivalent to an acre of farming land, then the Street can own the United States in fee simple, and can presently annex the rest of the world.

I acknowledge a certain admiration when I consider this stupendous scheme. It is more than Napoleonic; it is continental, interplanetary, sidereal! I cannot recall another conspiracy in the history of mankind quite equal in colossal and criminal splendor to the profound and universal plot of Wall Street to make perpetual the national debt, to keep that debt the bottom fact in the banking system of the United States, and to bull the unit of money and account until it shall be worth four times as much, or perhaps ten times as much, as it was when the bulk of the debt was contracted.

The history of this scheme in its true inwardness is the history of Wall Street for the past thirty years. The details of the history relate to such small circumstances as the transfer of the government of the great Republic from the hands and control of the people to the hands and control of the Street. Of course no such scheme as that referred to could be carried into successful operation _unless_ the national government could be delivered over to the keeping of the Street and be locked up, as it were, in the same vault where the national debt is deposited.

This feat, however, was easily accomplished. Wall Street reached out its hand and plucked down the American eagle from his perch. Wall Street got possession of the government. The _coup_ was accomplished while the nation was asleep--else it never could have been accomplished. Wall Street climbed the Tarpeian rock in the night, and no goose cackled to give the alarm. Columbia had gone to bed. The keeper of her treasure-house had already given the key to the enemy. The keeper of the treasury was a _part_ of the enemy. He gave up both citadel and city. In the morning the walls were placarded with lying posters which said that the delivery of the government into the hands of the Hessians had been rendered necessary in order "to preserve the national honor!" It was done in order to keep faith with those benevolent patriots who had bought the debt of the nation at less than fifty cents to the dollar, and who, not satisfied with bringing it to par, were now engaged in the honorable work of making it worth two hundred cents to the dollar. The fact that the industries of the people would be crushed and the people themselves be reduced to poverty by the transfer of the national sovereignty from the capitol to the stock exchange was nothing in comparison with the "preservation of national honor."

The scheme was carried out. The methods by which it was carried out constitute the subject-matter of the true history of Wall Street during the past generation. Wall Street, from being a financial organization, became a political power. It took full possession of the executive and legislative departments of the government. It controlled them both. It promptly established and defended its ownership. It instituted one scheme after another. For the purpose of fortifying its usurpation, it learned to choose its men and to prepare its measures in advance. In 1884 it created an administration for its own purposes, and manned it to the same end. It forced its way into the House of Representatives and stood with a bludgeon behind the Speaker's chair. It entered every committee-room and dictated every successful bill. The people's bills all went one way. If by any chance one of the people's bills got before the House the subsidized press, owned by Wall Street, raised against it a chorus of groans and catcalls; _that_ was "an expression of public opinion"!

From that day forth the popular voice was strangled into silence. The next administration (that of 1888) was prepared in the same manner. Wall Street has no politics except the politics of the bond; it has no platform except the platform of cent per cent. It suffices that when a president is to be elected he shall be one of us. He shall not be a man of the people; else in that case he would be a demagogue, a windbag, a _vox et præterea nil_. _Our_ man shall not even know the despised people. He shall not smell of the filthy ground, but must be "sound" on questions of finance. If he be not "sound," we will make him so. We will teach him his paces. If the people conclude to change their government, we will see to it that the incoming powers are just like the outgoing. As for the "principles" on which the candidate shall be chosen, we will attend to that. We will make his principles for him. We understand principles perfectly. We will fix the platform; we know the carpenters. If the candidate and his friends have already fixed a platform before the date of the convention, and if it have been published everywhere as the decision of the candidate and his following, we will take that platform from the wires and will carefully revise it, to the end that the "national honor" shall be preserved. We will write it over again into new meanings. We will interpret it so that no harm shall be done to the "national credit." We will make our candidate into a puppet. When we put our foot on the treadle his jaw shall drop and he shall utter many mocking words about the "national honor" and the "prospects of our glorious country"--signifying nothing.

All this we will do for the public good. We will say that we are striving for national prosperity. We will proclaim our candidate as the advance agent of prosperity--until after the election. Then we will say that prosperity will come with the inauguration. Then we will say that it will shine out promptly when Congress adjourns and ceases to menace the national credit. Then we will say that prosperity will reveal itself when the hot season is over. By this time the hoodwinked people can be coddled to sleep, or else set to dancing with rumors of foreign wars. To this end we will have our newspapers carefully promote our principles and studiously avoid all reference to those subjects in which the people feel the deepest concern. Finally, we will omit all these matters from our history of "Wall Street, Past;" we will proceed to speak of our "Wall Street, Present," and will explain that it is in a state of "lassitude and expectancy." Indeed "lassitude and expectancy" is good.

But there is still another yawning chasm in the history of "Wall Street, _Past_," and that is Mr. Clews's failure to discuss the transfer of the Treasury of the United States to the custody of the Street, and the consequent reduction of the Secretary of the Treasury to the rank of a clerk. This very thing has been most successfully accomplished. I believe that the Secretary still has an office at Washington, but that should be closed in the interest of economy and reform. To do so, we doubt not, would be a strong factor in the restoration of confidence. Perhaps the Washington office might be left in charge of a janitor, for it is understood that some official correspondence is still directed to the old address! The presence of the Secretary in New York, however, has become so essential to the proper discharge of his duties that the removal of his residence thither can only be deferred by an absurd deference to public opinion!

The results of the transfer of this vital function of the national government have, in the meantime, been so salutary as fully to vindicate the change. This was shown in 1893-94 when the Street, with a strong repugnance to investing money in useful enterprises, and having a prodigious accumulation of funds on hand, concluded that a sale of Government bonds was necessary for the "national honor." To this end the managers began to pull the treasury. In that institution a large sum of gold was stored, wholly without warrant of law. The people needed the gold beyond measure--that is, they needed the _money_; and gold is one form of money. The industries of the people had been prostrated by an international conspiracy, and the nation was quivering on the verge of apprehended ruin.

In this crisis the patriotic Street devised the bucket-chain, the crank of which was in the hand of the Street, while the "chain" ran through the Treasury of the United States. Every bucket came out filled with gold. Lazard Frères emptied out the gold and shipped it abroad to their confederates. This created the necessity for buying it back with bonds. The people were stunned with the audacity of the thing--just as the unfortunate owners of a house in flames are stunned to see gentlemen of the profession rush in and empty the safe. Wall Street danced and shouted while the work was done. The bonds were "popular," and the Street got them--got them for one price and sold them for another.

By this beautiful process the great American nation was literally held up and _robbed_ of more than nineteen million dollars! No highwayman ever more successfully clutched the wizen of his victim than did the Street with its supple fingers around the white larynx of Columbia. The wheezing of the strangulated Republic could be heard from the St. Lawrence to the Rio Grande. The nation was thus "saved," and the robbers took the money and went sailing away on summer cruises to Norway and Venice and the Cyclades. The "national credit" was preserved; Wall Street "rescued" us from dishonor! That part of the proceeds not consumed in yacht races, pyrotechnics, and balls was passed to the credit of the reform fund, needed for the restoration of prosperity in the fall of 1896! Certainly a history of "Wall Street, Past," ought to contain some reference to these crimes.

Mr. Clews, turning to "Wall Street, Present," tells the nation that now "the great banks have a superabundance of gold to lend on solid and readily salable collateral at low rates of interest, approximating the prevalent rates in London and Paris, where similar accumulations of idle capital exist." This is a true statement of the facts. Mr. Clews has here spoken by the books. What he says signifies that Wall Street is now ready to go ahead and issue new mortgages on the American people. It is now ready to offer inducements to our fourteen millions of voters to sell themselves into another twenty-year cycle of bondage. If they will only be gentle and not interrupt us; if they will give us a true death-grip on themselves, on all they possess, and all they ever hope to possess, we will lend back to them a part of the very money which we have sucked up from their wheat fields and pastures, from their barns and potato patches, from their humble stores and markets, from their mills and their mines, and we will thus _expedite_ them on the way to serfdom. Meanwhile we will continue to bankrupt their railways, to snatch their local stocks, to convert all shares in all enterprises into bonds, and to put the bonds into our safes to the end--that confidence may be restored and prosperity come back like the flowers that bloom in the spring.

For the time being we, the Street, are able to toss "two hundred thousand shares a day" on the horns of our bull, and to put the same amount of securities under the custody of our bear. "This conclusion takes it for granted that the profits should be equally divided among the membership." Such are Mr. Clews's very words. By the bond of my faith! there is nothing else so beautiful and magnificent as this among the arts invented by mankind! As for the people, one of your own kings, Messieurs of the Street, has very properly indicated your wish and purpose with regard to _them_.

Mr. Clews tells us that the "Future" of Wall Street is a sealed book; and yet we may allow that "there is such a thing as an accurate prevision of events." Of this kind are eclipses, occultations, and tides of the sea. If the capital of Wall Street has, since the institution was founded, increased more than sixtyfold, as Mr. Clews declares, then we may expect it, according to his philosophy, to increase full sixty times sixty, until the world shall be swallowed up. Then, when Threadneedle and Lombard Streets shall have lost their sceptre; then, when Seneca's forecast of the time to come shall have been fulfilled; then, when Macaulay's New Zealander shall have made his sketch, not only of St. Paul's, but also of the bank of England; then, when _all_ the wealth, and _all_ the power, and _all_ the functions of civil society in the United States shall have been transferred to Wall Street; then, when nothing shall remain to the American people except their squalid huts and the sorrowful reminiscences of a great republic; then, when Wall Street in very truth shall have possessed itself of the earth and consumed mankind,--I suppose that the benevolent owners of the world will found a few libraries, build a few marble mausoleums for themselves, and sally forth to establish a stock exchange in Mars! That done, interplanetary wars may be engendered, bonds on the solar system may be issued and bought at half price, a gold standard of values may be fixed on the basis of the pound sterling good from the sun out to Neptune, and the inhabitants of the worlds, either by arms or by journalism, may become the helots of consolidated wealth enthroned as the governing power of the universe.

THE REFORM CLUB'S FEAST OF UNREASON.

BY HON. CHARLES A. TOWNE,

_Chairman Provisional National Committee Silver Republican Party._

On Saturday evening, April 24, 1897, at the Waldorf Hotel, New York, there was held a political banquet intended as a most impressive function, but which has passed into history as a very ridiculous one. Big with self-complacence and puffed with pride, as it appeared in the brilliant lights and gorgeous appointments of the palatial supper-hall, within twenty-four hours the lacerating indignation of Mr. Watterson and the trenchant raillery of Mr. Bryan had let the tumid pretentiousness all out of it, and it had collapsed into a flaccid and "innocuous desuetude." The "star-eyed goddess" turned her back upon it, the "wild-orbed anarch" snapped his fingers at it, and even everyday Mrs. Grundy laughed it to scorn. Projected with the most alluring and satisfying expectations, the feast has dwindled to the memory of a sad mistake in the mind of every man that assisted at it. Planned as a sort of coronation ceremony, its completed performance unaccountably wore the complexion of belated obsequies irreverently disturbed by the guffaws of the multitude.

But the aspect of this banquet as a piece of ill-conceived political strategy that never was formidable, or as a rite in the ceremonial of a hero-worship that is as inexplicable as inopportune, does not now so much concern me as does its office as a dispenser of misinformation and unsound philosophy, which are always dangerous. Many who condemn the folly of it as a move in practical politics nevertheless loudly commend the economic doctrines it contributed to spread. But inasmuch as, in my opinion, the science it taught is as bad as the politics it practised, I propose to call attention to a few of the arrogant assumptions and mischievous theories that found emphatic and repeated expression at this feast.

Did the purpose of this article permit, it would be interesting to make Mr. Cleveland's speech the text of some examination into the ex-President's peculiarities of style. It was Clevelandesque to the core. All his protuberant characteristics are there: the leviathanic egotism, the profound and tenebrous ponderosity, the labored intricacy of the commonplace, the pedagogic moralizing, the oracular inconsequence. How absurdly obvious it all is now, and how inexplicable that the glamour of high place should ever have clothed such matter as his with the seeming of philosophy and statesmanship! 'Tis the very frippery and trumpery of the stage after the lights are out and the audience has departed.

In his opening Mr. Cleveland says: "On every side we are confronted with popular depression and complaint." This language stirs an echo of the long ago. In his special message to the extra session of the Fifty-third Congress in August, 1893, he thus announced a similar condition: "Suddenly financial distrust and fear have sprung up on every side." But he accounts differently for these two identical phenomena. The situation to-day he largely attributes to "the work of agitators and demagogues." In 1893 he declared: "I believe these things are principally chargeable to Congressional legislation touching the purchase and coinage of silver by the general government."

The ex-President's explanations are both wrong, and nobody ought to know it so well as himself. His relations with the great gold bankers were exceedingly intimate in 1892 and 1893, and have been so ever since. It is notorious that the panic of 1893 was a bankers' panic deliberately brought about by these men to frighten public sentiment into supplementing their demand for the repeal of the purchasing clause of the Sherman law of 1890. The agitation against that law was a whooped-up and manufactured agitation. No legitimate interest had suffered from its operation. On the contrary, the access of standard silver dollars coined under the laws of 1878 and 1890 had been of incalculable advantage to the country. In his annual message of December 2, 1890, President Harrison had thus referred to this fact: "The general tendency of the markets was upward from influences wholly apart from the recent tariff legislation. The enlargement of our currency by the silver bill undoubtedly gave an upward tendency to trade and had a marked effect on prices." And again: "It is gratifying to know that the increased circulation secured by the act has exerted, and will continue to exert a most beneficial influence upon business and upon general values."

Such an influence that circulation did indeed continue to exert. The comparative prosperity of the two following years, which, in contrast with the conditions of the subsequent period, causes 1892 to wear to wistful eyes so beautiful a hue in these unhappy days, would have been an absolute impossibility but for the silver legislation.

Nor was the credit of the government menaced. It was a malicious afterthought that represented the silver dollar as a charge upon the credit of the nation. That dollar was a standard dollar. It was never "redeemed" in anything but the money-work it did. There was no law for its redemption, and there was as yet no attempt, such as Mr. Carlisle in 1896 declared himself ready to make, to commit the crime of an administrative degradation of the circulating silver dollars into promises for the payment of gold. The Treasury Notes, issued in payment for silver bullion under the law of 1890, were redeemable in either gold or silver at the discretion of the Secretary of the Treasury; and inasmuch as there was silver behind every one of them, they could become a menace to the credit of the government only in case of the betrayal of his duty by that official.