CHAPTER OF ERIE

by Charles Francis Adams, Jr.**

1869

Conclusions

(The Erie War was a conflict between Commodore Vanderbilt [NY Central] and Jay Gould, James Fisk, Jr., and Daniel Drew [Erie RR] as they fought for exclusive railhead rights in Manhattan. [Vanderbilt won, but was bloodied in the battle.] Gould, Fisk, and Drew were a rough equivalent to today's Koch brothers. After describing the details of the conflict, Adams continues as follows. [Emphasis is added by the present editor, not by Adams.])

...It is not, however, in connection with the present that all this has its chief significance. It speaks ominously for the future. It may be that our society is only passing through a period of ugly transition, but the present evil has its root deep down in the social organization, and springs from a diseased public opinion. Failure seems to be regarded as the one unpardonable crime, success as the all-redeeming virtue, the acquisition of wealth as the single worthy aim of life. Ten years ago such revelations as these of the Erie Railway would have sent a shudder through the community, and would have placed a stigma on every man who had had to do with them. Now they merely incite others to surpass them by yet bolder outrages and more corrupt combinations. Were this not so, these things would be as impossible among us now as they are elsewhere, or as they were here not many years ago. While this continues it is mere weakness to attribute the consequences of a lax morality to a defective currency, or seek to prevent its outward indications by statute remedies. The root of the disease is deep; external applications will only hide its dangerous symptoms. It is well to reform the currency, it is well to enact laws against malefactors; but neither the one nor the other will restore health to a business community which tolerates successful fraud, or which honors wealth more than honesty.

One leading feature of these developments, however, is, from its political aspect, especially worthy of the attention of the American people. Modern society has created a class of artificial beings who bid fair soon to be the masters of their creator. It is but a very few years since the existence of a corporation controlling a few millions of dollars was regarded as a subject of grave apprehension, and now this country already contains single organizations which wield a power represented by hundreds of millions. These bodies are the creatures of single States; but in New York, in Pennsylvania, in Maryland, in New Jersey, and not in those States alone, they are already establishing despotisms which no spasmodic popular effort will be able to shake off. Everywhere, and at all times, however, they illustrate the truth of the old maxim of the common law, that corporations have no souls. Only in New York has any intimation yet been given of what the future may have in store for us should these great powers become mere tools in the hands of ambitious, reckless men. The system of corporate life and corporate power, as applied to industrial development, is yet in its infancy. It tends always to development, —• always to consolidation, — it is ever grasping new powers, or insidiously exercising covert influence. Even now the system threatens the central government. The Erie Railway represents a weak combination compared to those which day by day are consolidating under the unsuspecting eyes of the community. A very few years more and we shall see corporations as much exceeding the Erie and the New York Central in both ability and will for corruption as they will exceed those. roads in wealth and in length of iron track. We shall see these great corporations spanning the continent from ocean to ocean, — single, consolidated lines, not connecting Albany with Buffalo, or Lake Erie with the Hudson, but uniting the Atlantic and the Pacific, and bringing New York nearer to San Francisco than Albany once was to Buffalo. Already the disconnected members of these future leviathans have built up States in the wilderness, and chosen their attorneys [to be] senators of the United States. Now their power is in its infancy; in a very few years they will re-enact, on a larger theatre and on a grander scale, with every feature magnified, the scenes which were lately witnessed on the narrow stage of a single State. The public corruption is the foundation on which corporations always depend for their political power. There is a natural tendency to coalition between them and the lowest strata of political intelligence and morality; for their agents must, obey, not question. They exact success, and do not cultivate political morality. The lobby is their home, and the lobby thrives as political virtue decays. The ring is their symbol of power, and the ring is the natural enemy of political purity and independence. All this was abundantly illustrated in the events which have just been narrated. The existing coalition between the Erie Railway and the Tammany ring is a natural one, for the former needs votes, the latter money. This combination now controls the legislature and courts of New York; that it controls also the Executive of the State, as well as that of the city, was proved when Governor Hoffman recorded his reasons for signing the infamous Erie Directors' Bill. It is a new power, for which our language contains no name. We know what aristocracy, autocracy, democracy are; but we have no word to express government by moneyed corporations. Yet the people already instinctively seek protection against it, and look for such protection, significantly enough, not to their own legislatures, but to the single autocratic feature retained in our system of government, — the veto by the Executive. Through this, Governor Hoffman won and lost his reputation in New York, and it is to the possible use of this same power by President Grant, in Washington, that the people look for security from the misdeeds of their own representatives done under the influence of corporate wealth. The next step will be interesting. As the Erie ring represents the combination of the corporation and the hired proletariat of a great city; as Vanderbilt embodies the autocratic power of Cffisarism introduced into corporate life, and as neither alone can obtain complete control of the government of the State, it, perhaps, only remains for the coming man to carry the combination of elements one step in advance, and put Csesarism at once in control of the corporation and of the proletariat, to bring our vaunted institutions within the rule of all historic precedent.

It is not pleasant to take such views of the future; yet they are irresistibly suggested by the events which have been narrated. They seem to be in the nature of direct inferences. The only remedy lies in a renovated public opinion; but no indication of that has as yet been elicited. People did indeed, at one time, watch these Erie developments with interest, but the feeling excited was rather one of amazement than of indignation. Even where a real indignation was excited, it led to no sign of any persistent effort at reform; it betrayed itself only in aimless denunciation or in sad forebodings. The danger, however, is day by day increasing, and the period during which the work of regeneration should begin grows always shorter. It is true that evils ever work their own cure, but the cure for the evils of Roman civilization was worked out through ten centuries of barbarism. It remains to be seen whether this people retains that moral vigor which can alone awaken a sleeping public opinion to healthy and persistent activity, or whether to us also will apply these words of the latest and best historian of the Roman republic: "What Demosthenes said of his Athenians was justly applied to the Romans of this period; that people were very zealous for action so long as they stood round the platform and listened to proposals of reform; but, when they went home, no one thought further of what he had heard in the marketplace. However those reformers might stir the fire, it was to no purpose, for the inflammable material was wanting." *

* Mommsen, Vol. IV. p. 91, referring to the early Ciceronian period, B. c. 75.

** Charles Francis Adams, Jr., was the great-grandson of John Adams, the grandson of John Quincy Adams, and the brother of Henry Adams. He was treasurer of the NY Central Railroad in the late 1860s, during the period of competition between the NY Central's Commodore Vanderbilt and the men who ran the Erie Railroad: Jay Gould, James Fisk, and Daniel Drew. The conflict came to be known as the Erie Wars, and gave rise to such now-familiar business practices as watered stock and aggressive lobbying of legislatures and judges ("aggressive lobbying" even included exchanges of money, no surprise). Adams went on to become President of the Union Pacific Railroad. His book "Chapter of Erie," (from which this passage is excerpted), reflects his horror at the new business practices he witnessed. His concern was not that of a populist; he wanted democracy to function with a foundation of morality. He felt that for corporations to act immorally was not only wrong; it would create a reaction that would make it difficult for moral and honest businessmen to conduct their affairs. That is the basis for his conclusions quoted above. "Chapter of Erie" is available online as a Google book, in either Epub or PDF format.