Colonial wars were one thing. A major European or world war was something else again. Towards the end of the 1800s the technology of warfare had begun to advance apace. Instead of the single-shot rifle the British were equipped with bolt-action repeating weapons and the machine gun had made its appearance on the battlefield. Heavy and light artillery, previously only present in relatively small numbers because of transportation difficulties, now played a dominant role in large set-piece battles. Most important of all was the coming of the railways, which allowed large armies with their supplies and equipment to be transported overland very quickly. Armies in continental Europe that had previously taken weeks or months to prepare for a battle could now take the field in a matter of days. Another consequence of this new ease of overland transport was that much larger armies could readily be gathered together. From the latter part of the 1800s onwards wars would not be fought by armies numbering in the thousands but in the millions.
The problem for the British, the largest imperial power of them all, was that Britain was a small group of islands and therefore her armies, for whatever conflict, could not be transported to any foreign field by rail. They had to be moved by ship. To make matters worse, the British Empire, which her army had to police and defend, stretched right around the globe and was vulnerable to attack from any neighbouring country at short notice.
Winston Churchill, who served in the Boer War as a humble lieutenant but was to go on to become Britain’s most prominent politician, had himself seen at first hand how massive was the requirement for transporting troops to achieve victory. It was a lesson he did not forget.
To return to J. P. Morgan’s takeover of the White Star Line, 75% of the shareholders were for accepting his offer of £10 million, as it would give them a substantial profit on their original investments. Even William James Pirrie, the managing director of the Belfast shipbuilders Harland & Wolff and J. Bruce Ismay’s friend, was for selling out, if only because he confidently expected all of the lines making up IMM to come to him for any new vessels. Morgan clinched the deal when he offered to keep Ismay on as managing director, and chairman, of the White Star Line.
By May 1902 agreement had been reached, and on the 17th the last Annual General Meeting of the Oceanic Steam Navigation Company, the White Star Line’s parent company, took place. Five days later the agreement between John Pierpont Morgan and the White Star Line was signed. All the shareholders had been paid by 1 December 1902 and the White Star Line belonged to J. P. Morgan as part of the IMM group.
By the time the takeover was agreed only two of the original partners in the Oceanic Steam Navigation Company were to remain with IMM and White Star, Joseph Bruce Ismay and Harold Sanderson. Ismay and Sanderson had become friends in 1886, and in 1895 Ismay had invited Sanderson to join Ismay, Imrie & Company; he was made a partner in 1900.
Initially Morgan wanted Albert Ballin of the Hamburg Amerika Line to run IMM, but changed his mind when his plans to take over the two leading German lines fell through. Instead, although Ismay was still chairman and managing director of the White Star Line, Morgan decided that he was the man to take over as president of IMM as well. Initially Ismay refused, but the financial inducement of £20,000 a year was enough to make him change his mind, and on 21 February he wrote to Charles Steele, Morgan’s deputy, accepting the position as president of IMM.
From the moment the memo was signed, J. Bruce Ismay was in total charge of everything that happened within IMM, except the spending of Morgan’s money. Not only did he control everything, but he would also have been kept informed, one way or another, of everything that was going on within the company, and there was a lot going on.
On the other side of the Atlantic the American Government, which had some years earlier made an agreement with the rulers of China not to prohibit Chinese immigration, broke that agreement. In 1902 it made permanent the exclusion of Chinese immigrants from the United States, which had already been provisionally in effect for 20 years. Unfortunately, although it had made the entry of Chinese labour illegal, the Government did not manage to stop the immigrants themselves. The White Star Line had always played its part in transporting these Chinese labourers to America and continued to do so even after the practice had become illegal. It should perhaps be remembered that the American railroad system was constructed with a largely Chinese labour force and that it was principally Chinese workers who toiled in Mr Morgan’s steel mills. He would not therefore have seen this flouting of the law as anything detrimental in the shipping line.
J. P. Morgan never explained his decisions or sought publicity. A true autocrat, he gave orders and expected them to be obeyed. Only rarely would he express an opinion, and he seems to have taken the advice that appeared on a small white enamel plaque on the mantelpiece of his private study: ‘Pense moult, parle peu, écris rien’ (‘Think a lot, say little, write nothing’) -advice that suited every major successful criminal throughout history as well as it suited J. P.Morgan.
If British greed had been the cause of the Boer War and would play its part in the loss of the Titanic, then Belgian and American greed would be there as well.
Not long after Morgan gained control of the White Star Line, another little plum fell into his lap. The Belgian King, Leopold, had decided that the time was ripe for the exploitation of the Belgian Congo and that, as the Americans didn’t appear to want to establish an African empire of their own, he should call on their assistance. He first approached Henry Cabot Lodge, who suggested that he talk to Nelson Aldridge. Aldridge, the chairman of the American Senate Finance Committee, was another multi-millionaire and a card-playing partner of J. P. Morgan.
Leopold impressed Aldridge and a few other influential Americans by promising them a share in the loot from the colony. One of those impressed by the financial prospects was Thomas Fortune Ryan, another close associate of J. P. Morgan. Leopold’s plan was simple. He intended to open up a strip of territory right across the Congo and allow American businessmen to help themselves to whatever they wanted, in return for a percentage of the take. Once the Americans were established he believed that he would have nothing to fear from the major colonial powers like Britain and France. The King, in an effort to ingratiate himself with Morgan, gave more than 3,000 Congo artefacts to the American Museum of Natural History, knowing that Morgan was on its board. He need not have bothered as Morgan, through his associate Ryan, was already interested in the prospect of acquiring access to the Congo’s natural resources of copper, cobalt, diamonds, gold, tin, manganese and zinc. As a major steel producer, the American needed cobalt for the production of high-grade steels for tools and, hopefully in the near future, armour plate. Copper, tin and manganese were useful when it came to making tough bronze for such items as the propellers for his ships, and he was always interested in laying his hands on gold and diamonds. King Leopold’s timing could hardly have been better.
Leopold’s enthusiasm to involve J. P. Morgan in his schemes is understandable when one realises just how influential the banker was. In the 19th century the American economy went through a crisis about every 10 or 20 years - 1819, 1837, 1857, 1873, 1884 and 1893. After the crisis of 1893 J. P. Morgan spent most of the rest of the decade reorganising (Morganising) bankrupt railroads and industrial companies. Reorganising under the Morgan system usually meant that the financier ended up with a controlling interest in a company. By this time J. P. Morgan was so rich and powerful that when the American Government almost ran out of gold in 1895 he raised $65 million worth of the precious metal and bailed them out. In saving the US from bankruptcy Morgan had effectively bought the government of that country.
European bankers and statesmen were more than happy with Morgan’s performance as it kept America from reneging on its debts. The United States economy didn’t become self-supporting until 1914. Had the country been unable to pay its debts, or had gone off the international gold standard, foreign financiers would have withdrawn their money, crippling the economy and preventi
ng any further expansion. As it was, during the earlier part of the 1890s European investors had anticipated the coming crisis, sold off $400 million worth of American assets and sent the gold home. This would have inevitably slowed the growth of the American economy, but it didn’t stop it. By the time Leopold sought Morgan’s involvement in what has become known as ‘The Rape of the Congo’, the banker’s financial muscle and political influence was sufficient on its own to allow him to complete his plans.
Even though Morgan had spent the better part of a decade reorganising the American financial system at the end of the 19th and into the early 20th centuries, it still left a lot to be desired. In 1907 another crisis struck and the banker was forced to act again. Once more his intervention saved the US economy from total collapse. At that point he had reinforced the fact that he owned the government, or at the very least that it could not manage to regulate the financial establishment without his help. Although such a concentration of power went against the grain of the American masses, it would take six years and a change of government and president, and the decline of J. P. Morgan’s health, before his grip loosened. The financier’s power to control the actions of the American Government, to a greater or lesser extent, meant that he could be sure that any inquiry into his part in what was about to happen on the North Atlantic would not ask too many pertinent questions.
Chapter 3
A dual role
By the latter part of 1907 it seems that J. P. Morgan, possibly with an eye to the profitability of long-distance large-scale troop transport in war, which he had learned all about when he moved to take over the White Star Line, decided to have a finger in both the peace and war enterprises that were then gaining momentum. Big ships were clearly going to be a good investment for him, especially as they are built of steel for which he needed new outlets after the American railroad building boom came to an end. After all, he was among the world’s largest steel producers, and ship owners.
William Pirrie, at Harland & Wolff, had already begun modernisation of the Belfast yard to enable the construction of the world’s largest ships, which would not have happened without the agreement of Morgan, at least in principle, that those ships should actually be built. Major alterations to British docks and shipyards at that time also required the agreement of parliament, which is another indication that the British Government recognised the coming need for some exceptionally large vessels. J. P. Morgan and the management of the White Star Line would also have been aware of the British Government’s future need for large transports when the inevitable European war broke out, and would have wanted to be the people to supply them, at a price. If some sort of British Government subsidy could be agreed, White Star would be more than happy to have the world’s largest liners built for use by themselves on the profitable North Atlantic route in peacetime, and for the Government to utilise in time of war. This would be an ideal arrangement for Morgan and White Star, as the already existing agreement with the British Government meant that the line’s vessels were at the latter’s disposal anyway, if the worst came to the worst, so any new agreement would merely reinforce the existing one.
At the same time the British Prime Minister, David Lloyd George, and his familiar, Winston Churchill, must have seen an opportunity of acquiring some large troop transports or hospital ships at a reduced rate. However, from a military viewpoint there was an obvious snag: how well would vessels as large as those envisaged for the White Star Line withstand damage inflicted by enemy action? Could the 5,000 or so troops they were comfortably capable of carrying be evacuated in an emergency? Large warships were unlikely to pose any great threat to the new liners because of their high speed. The guns of smaller vessels were limited in size and would only be able to inflict minimal damage before the liner’s own armaments could be brought into play. With the submarine an untried weapon, mistrusted by the Admiralty, the only way a small warship could be expected to stop a huge liner was by ramming it. Any new vessel intended to carry a significant part of the British Army at any one time would have to be tested so that the planners could be reasonably sure it could survive such an encounter. If that same test could also be used to demonstrate to J. P. Morgan and others that they were not necessarily cock of the walk, so much the better. However, such a test was still a little way away into the future, and other factors would come to have a bearing.
In 1898 Guglielmo Marconi, long accepted as the inventor of wireless even though he wasn’t, fitted the St Paul, a 554-foot-long American Line luxury liner, with a temporary wireless installation in order to show potential financial backers that the system was viable. (The first wireless patent had been granted by the American Government to one Mahlon Loomis more than 20 years before Marconi claimed wireless as his own invention.) The advantages of wireless at sea are all too obvious to us now, but at the end of the 19th century ship owners were not easily convinced that it was worth the expense. The Germans, however, were so impressed that they fitted the Kaiser Wilhelm der Grosse with Marconi equipment in 1900. This was the first permanent Marconi wireless installation afloat.
With his eye to the maritime application of ‘his’ invention, Marconi took a house on the Hyde side of Southampton Water. By this time many major shipping lines, particularly those sailing on the Atlantic routes, were operating out of the Hampshire port and had offices there.
The potential spread, on a worldwide scale, of the new invention may not have had the mass investment attraction that the Internet and video phone communications have for today’s smart money. Nonetheless, there was almost certainly a core like Lloyd George, Sir Rufus Isaacs (the Attorney General) and his brother, and a few other influential characters in the British political hierarchy, who were keen to see the commercial arteries expand, as they stood to make a lot of money by investing in the new technology. On top of that was the possibility for exploitation by the intelligence services of practically all the major powers, a possibility they were not slow to appreciate. Just as with computers today, there was no such thing as security. The only way to protect information was to encrypt it, and code-breakers have always delighted in deciphering the most complicated of riddles. During that first decade of the 20th century there was enough going on to warrant every government having a militant intelligence arm dedicated to the gathering of what was known as wireless intelligence, now referred to as ‘SigInt’. Most of them had rather more than one.
The main British example of this new branch of intelligence-gathering operated out of a single room in the Admiralty building, the now famous Room 40. Room 40 eventually grew into what we now know as GCHQ. As a consequence of this preoccupation with gathering wireless intelligence, as well as the convenience of being able to communicate with ships at sea, and for those ships to be easily able to communicate with one another, warships of all the major powers were soon equipped with the most powerful up-to-date versions of the new invention. While at sea the warships of the Royal Navy kept a constant watch on all wireless traffic coming from any source within range, in the hope of overhearing something useful.
Wireless was by no means the only enormous technical development to manifest itself during those early years of the 20th century. Not least among the remainder was the evolution of liquid fuel to replace coal as the main source of energy aboard British warships. Winston Churchill and his mentor, Jackie Fisher, were behind the Royal Navy’s policy of building new super-dreadnoughts fuelled by oil instead of coal, despite the fact that Britain had any amount of coal but no oil. To ensure an adequate supply of the precious fluid Churchill turned his attention to the massive oilfields of Persia/Iraq, the same oilfields that are being fought over today. At the time Churchill steered the British Government into a move to take over control of the oil in Iraq even though he actually had no direct influence over British naval policy. However, he did have plans to gain control of it before many years had passed. He knew that the British Empire’s most potent weapon was still the all-powerful Royal Navy. Admiral Fisher had a
lready explained to the politician how, if ships could be refuelled at sea or at least very quickly in harbour, then because they could be at sea for a greater percentage of their time the effective size of the fleet would automatically increase.
April 1908 was not a particularly good month for the Royal Navy. The cruiser HMS Tiger was rammed while on manoeuvres south of St Catherine’s Point on the Isle of Wight during the first week of the month. Then, about three weeks later, on the 25th, HMS Gladiator, another cruiser, was rammed by the American liner St Paul (which we have already come across) during a snow squall off Great Yarmouth. The Gladiator had to be beached to prevent her from sinking. Twenty-seven lives were lost. The Trinity House Pilot aboard the St Paul at the time of the collision was George Bowyer, who would also be acting as pilot aboard Olympic when she was rammed by HMS Hawke in September 1911, and who would be on the bridge of the Titanic when she departed Southampton at the start of her ill-starred maiden voyage on 10 April 1912, when she almost collided with the American liner New York.
The Great Titanic Conspiracy Page 4
