CHAPTER VI
ARSON AND ESPIONAGE
It will be necessary to return to the subject of bribery when we come to the marketing business of the Trust. We will now pass to a few examples of the resort to open violence for the attainment of the Trust’s ends. The Tidewater Pipe Line was started by Lombard, Ayres & Co., New York refiners, and others, on the publication of the Rutter circular; and Mr. Rockefeller offered at first to buy them out--pipes, refineries, and all--but refused finally to give the price of $15,000,000 they asked. The Standard’s next move was the purchase of a certain minority of the shares in the Tidewater Company. On January 17, 1883, the Standard stockholders held a hugger-mugger meeting at the Tidewater office in Titusville, without notifying the stockholders generally, voted the turning over of the control to Standard Oil interests, and took possession of the office in the name of that Company. The president of the Tidewater, however, who had been absent in New York, met this attempt by another equally determined. He carried the office by surprise, barricaded it, and kept forcible possession till a suit could be brought to declare the meeting void, which was legally accomplished. Previously to this all sorts of material obstacles had been put in the way of the Tidewater pipe getting to the sea; the railroads constantly opposed the Company’s obtaining a right of way, and mysterious individuals--obviously representing Standard interests--constantly cropped up along the proposed route, acquiring exclusive rights over strips of land running at right angles to the proposed right of way, some of these tiny ribbons of land being forty miles long. Finally, the Tidewater Pipe Line became a Standard Oil tentacle.
In the case of the United States Pipe Line--organised by the independent oil producers and not to be confused with the United Pipe Lines, which were always a Rockefeller organisation--it has been clearly shown that the Standard Oil Company’s representatives have resorted to similar means of obstruction. Physical force was used on several occasions, a notable instance being that of the crossing of the Delaware River at Hancock under the Erie Railroad bridge in 1893. Erie interests as such were in no wise affected by the crossing, and the president of the Erie road, after a conference with Mr. Emery, manager of the United States Pipe Line, had informed him that there would be no objection to going under the bridge, and even sent his own engineer to Hancock to make arrangements for the exact location of the pipe. When the connection from both sides of the river was about to be made, however, the railroad company ran up two engines and “wrecking cars,” with about seventy-five men, and placed inflammable material over the ends of the pipe lines, so that on any attempt to connect they would be so heated that connection would become impossible. The spot was beleaguered by the hostile forces of the railroad and the pipe line company for three months, when the latter abandoned the route and set its pipes seventy miles back to a place called Athens, Pa. The case for the United States Government in the Missouri prosecution says:--
The obstruction came in part directly from the agents of the Standard Oil Company and partly from the railroads, but there is every reason to believe that the railroads were acting in the interests of the Standard Oil Company, as their own interests would scarcely be injured by the pipe line, and as they had (so far as the evidence shows) never opposed the construction of pipe lines by the Standard Oil Company.
I select another case from the year 1895, when the United States Pipe Line was getting in through the State of New Jersey to New York harbour. The account of it may be best given in the words of the United States Attorney-General’s brief in the Missouri case:--
When the Delaware, Lackawanna, and Western Railroad was reached at Washington, N.J., serious opposition was again encountered. The pipe line company bought the fee simple title to land at a point where there was a culvert in the railroad and placed a pipe through this culvert, and put a force of men in charge. The next day two locomotives, a wrecker, and 150 men attempted by force to eject the employees of the pipe line from their position and to tear up the pipes. A hand-to-hand fight ensued, and finally an agreement was reached by which the matter was taken into Court. Mr. Emery testifies that some of the same men who opposed the passage of the pipe under the tracks of the Erie Railroad at Hancock, N.Y., some two years before, were also among the representatives of the Delaware, Lackawanna, and Western Railroad in the trouble at Washington, N.J. After a delay of six months the lower Court decided in favour of the right of the pipe line to cross the tracks.
In 1879 the owners of the Vacuum Oil Works, of Rochester, N.Y., Messrs. H. B. and C. M. Everest, father and son, made over a three-fourths interest in their concern, which manufactured a patent lubricating oil, to the Standard Oil Company, the Everests remaining managers on a salary, and also being co-directors along with Messrs. H. H. Rogers, J. D. Archbold, and Ambrose McGregor, of the Standard Oil Trust, of which the Vacuum Oil Company was now run as a subsidiary. The following year three of the employees, Wilson, Matthews, and Miller, having got some money together, thought that they would like to start refining on their own account, and did so, setting up the Buffalo Lubricating Oil Company in the town of Buffalo. C. M. Everest warned them he would do all in his power to injure their concern. He tried especially, by an offer of $20,000, to get Miller, who was the most practical refiner of the three, to break his contract with his two new partners, and on June 7, 1881, H. B. Everest took Miller to the office of his lawyer, Mr. Geo. Truesdale, in order to come to an arrangement with him. Mr. Truesdale afterwards testified as follows in regard to this interview (Proceedings in Relation to Trusts, House of Representatives, 1888, Report No. 3,112, p. 864):--
I told him (Miller) that I did not know the exact terms of his contract, but if he had entered into a contract and violated it I presumed there would be a liability for damages as well as a liability for the debts of the Buffalo party. Mr. Miller and Everest both talked on the subject, and Mr. Everest says, “I think there are other ways for Miller to get out of it.” I told him I saw no way except either to back out or to sell out; no other honourable way. Mr. Everest says, substantially, I think, in these words: “Suppose he should arrange the machinery so it would bust up, or smash up, what would the consequences be?”--something to that effect. “Well,” I says, “in my opinion, if it is negligently, carelessly done, not purposely done, he would be only civilly liable for damages caused by his negligence; but if it was wilfully done, there would be a further criminal liability for malicious injury to the property of the parties--the company.” Mr. Everest said he thought there wouldn’t be anything only civil liability, and said that would--he referred to the fact that I had been police justice, had some experience in criminal law--and he said that he would like to have me look up the law carefully on that point, and that they would see me again.
Shortly afterwards Miller blew up a still in the Buffalo works twice over by overheating, but did no further damage beyond spoiling the 175 barrels of oil contained in the still. He absconded, was kept in idleness, or semi-idleness, by the Vacuum Company at a salary of $1,500 a year, and the latter company proceeded to harass the Buffalo Lubricating Oil Company out of existence by taking one vexatious action after another against it on the ground of infringement of patents. These were all decided in favour of the Buffalo Company by the Courts except in one case, for a purely technical infringement it was condemned to pay 6 cents (3d.) damages. Finally, the Buffalo Company turned on its adversary and took an action against the Vacuum Oil Company directors, H. H. Rogers, J. D. Archbold, A. McGregor, and the two Everests for criminal conspiracy, instituting at the same time civil suits for damages. The trial, at which Mr. J. D. Rockefeller and all the forces of the Standard Oil were mustered, aided by the most eminent counsel in the States, came off at Buffalo on May 2, 1886, and Messrs. Rogers, Archbold, and McGregor escaped owing to the judge withdrawing the case from the jury, because, although they were directors of the Vacuum Oil Company, it could not be proved that they had advised Miller to cause an explosion. The two Everests were condemned. By various means the Standard contrived to stay execution of the sentence until May, 1888, two years later; the statute provided a penalty of one year’s imprisonment or $250 fine, or both. Great efforts were made to obtain a mitigation of the sentence. A petition signed by forty “leading citizens” of Rochester was handed in to the judge, praying him, on account of the “untarnished fidelity and integrity” of the convicted men, to make the penalty as light as the Court was authorised by law to fix. In the result the two Everests were each fined $250 for the criminal offence, and the Vacuum Oil Company settled the civil suits for $85,000 (£17,000). This is the case on which the late Mr. Henry D. Lloyd (whose work, “Wealth against Commonwealth,” was the first to expose the Standard’s misdeeds), based the caustic comment: “The Standard Oil Trust is evangelical at one end and explosive at the other.”
It was remarked in a previous chapter that the unfair advantages conceded to Mr. Rockefeller by the conspiring railroads afford a sufficient answer to the Standard Oil Trust’s contention that the secret of its success lies in its superior business ability. But there is no need to deny a high level of business ability to Mr. Rockefeller and his associates. The Standard Oil people have always enjoyed this legitimate advantage of knowing exactly what they intend doing. Granting, however, that the Standard people are the keenest of business men, it is equally certain that they have pushed their keenness to the point where it has become mere unscrupulous cunning and chicanery. This is conspicuously shown in the history of the Trust in its character of salesmen.
Every local agent for the sale of Standard oil is required to furnish reports to the statistical department of the Standard Oil Trust at 26, Broadway, New York, of all the transactions entered into by every dealer in his district. His business, in short, is to know everybody else’s business and to report it. This is done by filling up printed forms showing in parallel columns against every retailer’s name in the district, be he shopkeeper or pedlar, the description and brand of goods he buys and sells, how the goods have been transported, their price, and the name and address of the wholesale dealer who supplied them. The agent is stimulated in every way by reproof and reward to obtain the most intimate and apparently trifling details bearing upon the above points, and, as is well known in the United States, is generally converted by the system into a mere spy, who will not stick at bribery or any other dirty trick so long as he can give his chiefs the desired information. The United States Government agents found that the Standard’s “statistical department” was presided over by a man named Christian Dredger--a name which, allied to the occupation, certainly reminds one of “the man with the muck-rake.” The knowledge that a local grocer or pedlar is buying elsewhere than from the Standard is no sooner received by mail or telegraph at the statistical department than a Standard agent is told off to swoop down upon the “irregular trader,” and either by threats of underselling and ruining his business in case he persists to offer the “independent” oil, or by promising him a secret rebate on published prices, secures his submission. If the agent can persuade the retailer to countermand his order from the independent, so much the better.
These accusations are proved beyond question by extant collections of hundreds of letters and numerous telegrams received by independent retailers, and by a superabundance of sworn testimony from all parts of the States. Just to show how the thing works, here is a typical letter received by a retailer who has been caught ordering oil from an independent, and has been “persuaded” to countermand the order:--
DES MOINES, IOWA, _January 14, 1891_.
John Fowler, Hampton, Iowa.
DEAR SIR,--Our Marshallstown manager, Mr. Ruth, has explained the circumstances regarding the purchase and subsequent countermand of a car of oil from our competitors. He desires to have us express to you our promise that we will stand all expense, provided there should be any trouble growing out of the countermand of this car. We cheerfully promise to do this; we have the best legal advice which can be obtained in Iowa bearing on the points in this case. An order can be countermanded either before or after the goods have been shipped, and, in fact, can be countermanded even if the goods have already arrived and are at the depôt [_anglice_, railway station]. A firm is absolutely obliged to accept a countermand. The fact that the order has been signed does not make any difference. We want you to absolutely refuse under any circumstances to accept the car of oil. We are standing back of you in this matter, and will protect you in every way, and would kindly ask you to keep this letter strictly confidential.
Yours truly, E. P. PRATT.
Another typical example of Standard methods is revealed in the following letter addressed to the Independent Oil Company, of Mansfield, Ohio, by one of its customers:--
TIFFIN, OHIO, _January 24, 1898_.
DEAR SIRS,--I am sorry to say that a Standard Oil man from your city followed that oil car and oil to my place, and told me that he would not let me make a dollar on that oil, and was dogging me around for two days to buy that oil, and made all kinds of threats, and talked to my people of the house while I was out, and persuaded me to sell, and I was in a stew what I should do, but I yielded, and I have been very sorry for it since. I thought I would hate to see the bottom knocked out of the prices, but that is why I did it--the only reason. The oil was all right. I now see the mistake, and that is of getting a carload. Two carloads coming in here inside of a week is more than the other company will stand....
Yours truly, H. A. EIRICK.
Chess, Carley & Co., the Standard marketing agents at Louisville, Kentucky, are big offenders in this respect. The late Mr. George Rice, of Marietta, Ohio, a well-known independent, offered a grocer named Armstrong, in Clarksville, Tennessee, his oil at a lower price than Chess, Carley & Co. would sell to him at. Armstrong mentioned the offer to the latter, and “was scared almost out of his boots,” wrote Rice’s agent.
Carley told him, continues the agent, “he would break him up if he bought oil of any one else; that the Standard Company had authorised him to spend $10,000 to break up any concern that bought oil from any one else; that he (Carley) would put all his drummers in the field to hunt up Armstrong’s customers, and sell his customers groceries at 5 per cent. below Armstrong’s prices, and turn all Armstrong’s trade over to Moore, Bremaker & Co., and settle with Moore, Bremaker & Co. for their losses in helping to break Armstrong up, every thirty days.”
The Waters-Pierce Oil Company, the Standard’s Texas and Mexico branch, are equally bad, and their methods are denounced by their customers in similar language to that already quoted. The retailers speak of their threats, their “cutting to kill”; they complain that the Standard agents “nose” about their premises, ask impudent questions, and generally make trade disgusting and humiliating.
The system naturally results in bribing employees, not only of the railroads, but of the independents themselves in order to gain information. The bribes seem to have been generally small in amount, but to have yielded wonderful results. For instance, in 1893, a negro boy who was induced by the Atlantic Refining Company of Philadelphia (Standard Oil subsidiary), to supply regular details of the business of the Lewis Emery Oil Company, his employers, was only paid $90 (£18) for supplying information as to the firm’s daily shipments for about six months and also for smuggling his company’s price-book to the Standard managers to be copied out! Most of the old legends about a man “selling his soul to the devil” make Mephistopheles do something very substantial as his part of the bargain. But the Standard Oil Trust is capable of giving his Satanic Majesty many wrinkles in “labour-saving” methods, and breaks down the moral sense of the rising generation on much more economic principles. E. M. Wilhoit, Standard agent at Topeka, Kansas, from 1891 to 1898, testified in the Missouri trial that his agency was allowed $8 (£1 12s. 6d.) a month for paying railroad employees for information of competitive shipments, Mr. E. P. Pratt, the manager of the Kansas City branch of the Consolidated Tank Line Company, forwarding this $8 from Kansas City by his personal cheque. Mr. G. W. Mayer, who succeeded Pratt, reduced this amount to $6 (25s.) a month. The cheques came in blank envelopes without any letter, and the instructions as to what should be done with the money were given verbally. The clerks of five different railways were called upon once a week for this information, which was generally written on a small slip of paper and handed to the drayman who took oil to the railroad. I select this case almost at random as a typical one from an ocean of similar evidence. From the tempter’s point of view it certainly seems a very cheap line of damnation.
THE “BOGUS INDEPENDENTS”
“The very rich are just like all the rest of us; and if they get pleasure from the possession of money it comes from their ability to do things which give satisfaction to some one besides themselves.”
JOHN D. ROCKEFELLER _in_ “_Random Reminiscences_.”