Work there had been progressing rapidly. The house itself was finished; the principal apartments were ready to be occupied. The surroundings of course were in confusion. Steam drills were going all the time. Roadways were blasting through solid rock. The landscape was in turmoil.
“But you could live there now,” said Natalie, “if you didn’t mind the noise,” closing a long recital, to which Galt had listened thoughtfully.
“We might have the wedding there,” he said.
His suggestion produced a ghastly silence. Mrs. Galt tried to turn it away. Galt was alert.
“What have I stepped on now?” he wanted to know. “Suffering Moses I It ain’t safe for me to walk around in my own house. What’s the matter?”
“Nothing,” said Natalie.
“Yes, there is. What is it?”
When he couldn’t be put off any longer Vera said, quietly: “My engagement to Lord Porteous is broken.”
“Why?” asked Galt, astonished. “That’s the first I’ve heard of it.”
“No matter why,” said Vera. “Let’s not talk about it.”
He looked into their faces severally. His expression was utterly wretched and they avoided it. He guessed the reason why,—made it perhaps even worse than it was.
In his own household he was on the defensive. There was always that inaudible accusation he could never get hold of. In the old days it was that he stretched them on the rack of insecurity and was not like other men. Then it was the way he had made them rich. Now it was that dreadful sense of insecurity again. They did not know whether they were rich or poor. They thought he was heading for a last spectacular smash-up. And suppose he had told them there was happily no danger of that. Their thoughts would accuse him still. Why couldn’t they be rich as other people were, decently, quietly and in good taste? The Valentines were rich and no obloquy pursued them. Their privacy was not besieged by newspaper reporters. The finger of scorn never pointed at them.
Vera’s broken engagement was a harrowing symbol. Galt was extremely miserable. One could imagine what he was thinking. The Galt fortune was saved. The Galt power had survived. But the Galt name was a sound of reproach. The public opinion that had so devastated his spirit did not leave his family unwhipped. These women had suffered for being his. Though they might not believe the things that were said of him, still they could not help feeling ashamed of the wealth he had brought them. They were defenseless. He was clothed with a sense of justification that he could not impart. They were naked to the scourge.
His day of victory ended in gloom and dumb wretchedness.
CHAPTER XV
THE HEIGHTS
i
THEN with one swift intention the sun broke through,—and there were the heights!... directly in front of him. The rest of the way was enchanted. All its difficulties were illusions. They vanished as he approached.
His Wall Street enemies were scattered in the night. It was as he had said. They had been unable to destroy him and they did not dare carry the fight any further for fear of involving themselves in ruin. His amazing counter stroke, delivered at the very moment when their utmost effort had failed, threw them into a panic. It took the stock market out of their hands and turned it squarely against them. The conspiracy was not abandoned. It collapsed. After that it was every man for himself, with the fear of Galt in his heart.
The penitential procession started early the next day. Those who had deserted him returned with gestures of humility, begging to be chastised and forgiven. The vanquished sat patiently in his outer office, bearing tokens of amity and proposals of alliance. For he was Galt, the one, unique and indestructible.
He treated the spectacle as it deserved, cynically, with a saving salt of humor.
“They make their beds fast,” he said.
Among the first to come was one of Bullguard’s partners,—a peasant-minded, ingratiating person whose use to Bullguard was his ability to face the devil smirk for smirk. His errand was to say that Bullguard & Co. would entertain any reasonable offer for the purchase of their minority interest in Orient & Pacific shares, and if they could be of service to Mr. Galt at any time, why, etc., he had only to oblige them by letting them know how. Galt was cool as to the services, etc., but he made an offer for the minority Orient & Pacific shares which was accepted a few hours later. That was Bull-guard’s way of declaring war at an end. It was the grand salute.
Horace Potter was the only man who never came back. He could not sneak back and there was no other way. They had mortally wounded each other’s pride.
ii
Meanwhile Congress, like the old woman of the story book, heavy-footed, slow to be amazed, always late but never never, heard of Galt, became much alarmed and solemnly resolved to investigate him. He was summoned to appear before a Committee of the House with all his papers and books. The Committee felt incompetent to conduct the examination. Finance is a language politicians must not know. It is not the language of the people. So it engaged counsel,—a notorious lawyer named Samuel Goldfuss.
He was a man who knew all the dim and secret pathways of the law, and charged Wall Street clients enormous fees for leading them past the spirit to the letter. He charged them more when he caught them alone in the dark, or lost in the hands of a bungling guide, for then he could threaten to expose them to the light if they declined to accept his saving services at his own price. Having got very rich by this profession he put his money beyond reach of the predacious and became public spirited, or pretended to have done so, and proceeded to sell out Satan to the righteous. It became his avocation to plead the cause of people against mammon, and where or whensoever a malefactor of great wealth was haled to court or brought to appear before a committee of Congress, Goldfuss thrust himself in to act as prosecuting attorney, with or without fees; and his name was dread to any such, for he knew their devious ways and all the wickedness that had ever been practiced in or about the Stock Exchange. His motives were never quite understood. Some said he attended to Satan’s business still, never sold him out completely, but put the hounds on the wrong scent by some subtle turn at the end. Others said his motive was to terrorize the great malefactors so that when they were in trouble he could extort big fees simply for undertaking not to appear on the people’s side.
And this sinister embodiment of public opinion was the man whom Galt was to face, who had never before faced public opinion in any manner at all. It was likely to be a stiff ordeal. Counsel warned him accordingly.
“I’ve got a straight story to tell,” he said. “I don’t need any help.”
However, they insisted on standing by. We arrived in Washington one hot August morning, left all our eminent counsel in their favorite hotel, and went empty handed to the Capitol, where neither of us had been before. We wandered about for half an hour, trying to find the place where the Committee sat. It was a special Committee with no room of its own. We were directed at last to the Rivers and Harbors Committee room. It was full of smoke, electric fans and men in attitudes of waiting. Six, looking very significant, sat around a long table covered with green cloth. Others to the number of thirty or forty sat on chairs against the walls. At a smaller table were the reporters with reams of paper in front of them.
“Is this the Committee that wants to see Henry M. Galt?” he asked, standing on the threshold.
“It is,” said the man at the head of the table. He was the chairman. He sat with one leg over the arm of his chair, his back to the door, and did not turn or so much as move a hair. He spoke in that loud, disembodied voice which makes the people’s business seem so impressive to the multitude and glared at us through the back of his head.
“I am that person,” said Galt.
“You have delayed us a quarter of an hour,” said the chairman, still with his back to us.
“You were hard to find,” said Galt, very simply, looking about for a place to sit. A chair was placed for him at the opposite end of the table. There was no place for me, so I stood a litt
le aside. Gold-fuss, whom I had never seen and had not yet identified, sat beside the chairman. They had their heads together, whispering. The chairman spoke.
“The question is raised as to whether witness may be permitted to appear with counsel. It is decided in the negative. Counsel will be excused.”
Silence. Nothing happened.
“Counsel will be excused,” said the chairman again.
Still nothing happened.
“If you are talking at me,” said Galt, “I have no counsel. I didn’t bring any,—that is, I left them at the hotel.”
“Who is the gentleman with you?” the chairman asked.
“Oh,” said Galt, looking at me. “That’s all right. He’s my secretary. He doesn’t know any more law than I do.”
There was a formal pause. The official stenographer leaned toward Galt, speaking quietly, and took his name, age, address and occupation. The chairman said, “Proceed.”
Goldfuss poised himself for theatrical effect. He was a small, body-conscious man with a coarse, loose skin, very close shaven, powdered, sagging at the jowls; a tiny wire mustache, unblinking blue eyes close together and a voice like the sound of a file in the teeth of a rusty saw.
“So this is the great Galt,” he said, sardonically, slowly bobbing his head.
“And you,” said Galt, “are the Samuel Goldfuss who once tried to blackmail me for a million dollars.”
Oh, famous beginning! The crowd was tense with delight.
Goldfuss, looking aggrieved and disgusted, turned to the chairman, saying: “Will the Committee admonish the witness?”
The chairman took his leg down, carefully re-lighted a people’s cigar, and said: “Strike that off the record.... I will inform the witness that this is a Committee of Congress, with power to punish contumacious and disrespectful conduct.... The witness is warned to answer questions without any irrelevant remarks of his own.”
“I beg your pardon,” said Galt. “What was the question?”
The official stenographer read from his notes,—“So this is the great Galt”
“That ain’t a question,” said Galt.
The round was his. The audience tittered. The chairman put his leg back and glared wearily into space.
“I withdraw it,” said Goldfuss. “Start the record new from here.... Mr. Galt, you were directed to produce before this Committee all your books and papers. Have you brought them?”
“No.”
“No? Why not, please?”
“They would fill this whole room,” said Galt.
Mr. Goldfuss started again.
“Your occupation, Mr. Galt,—you said it was what?”
“Farmer,” said Galt.
“Yes? What do you farm?”
“The country,” said Galt.
“Do you consider that a nice expression?”
“Nicest I know, depending on how you take it,” said Galt.
“Well, now tell this Committee, please, how you farm the country, using your own expression.”
“I fertilize it,” said Galt. “I sow and reap, improve the soil and keep adding new machinery and buildings.”
“What do you fertilize it with, Mr. Galt?”
“Money.”
“What do you sow, Mr. Galt?”
“More money.”
“And what do you reap?”
“Profit.”
“A great deal of that?”
“Plenty,” said Galt.
“And what do you do with the profit, Mr. Galt?”
“Sow it again.”
“A lovely parable, Mr. Galt. Is it not true, however, that you are also a speculator?”
“Yes, that’s true,” said Galt.
“To put it plainly, is it not true that you are a gambler?”
“That’s part of my trade,” said Galt. “Every farmer is a gambler. He gambles in weather, worms, bugs, acts of Congress and the price of his produce.”
“You gamble in securities, Mr. Galt?”
“Yes.”
“In the securities of the railroad properties you control?”
“Heavily,” said Galt.
“If, for example, you are going to increase the dividend on Great Midwestern stock you first go into the market and buy it for a rise,—buy it before either the public or the other stockholders know that you are going to increase the dividend?”
“That’s the case,” said Galt.
“As a matter of fact, you did some time ago increase the dividend on Great Midwestern from four to eight per cent., and the stock had a big rise for that reason. Tell this Committee, please, when and how and at what prices you bought the stock in anticipation of that event?”
“In anticipation of that eight per cent. dividend,” said Galt reminiscently, “I began to buy Great Midwestern stock... let me see... nine years ago at ten dollars a share. It went down, and I bought it at five dollars a share, at two dollars, at a dollar-and-a-half. The road went into the hands of a receiver, and I stuck to it. I bought it all the way up again, at fifteen dollars a share, at fifty dollars, at a hundred-and-fifty, and I’m buying still.”
Goldfuss was bored. He seemed to be saying to the audience: “Well, so much for fun. Now we get down to the hard stuff.” He took time to think, stirred about in his papers and produced a certain document.
“Mr. Galt, I show you a certified list of the investments of the Security Life Insurance Company. You are a director of that insitution, are you not?”
“Yes.”
“You used some of your farming profits to buy a large interest in the Security Life Insurance Company?”
“Yes.”
“You are chairman of its finance committee?”
“Yes.”
“In fact, Mr. Galt, you control the investments of the Security Life. You recommend what securities the policy holders’ money shall be invested in and your suggestions are acted upon. Is that true?”
“Something like that,” said Galt.
“Now, Mr. Galt, look at this certified statement, please. The investments amount to more than foor hundred millions. I call your attention to the fact that nearly one quarter of that enormous total consists of what are known as Galt securities, that is, the stocks and bonds of railroad companies controlled by Henry M. Galt. Is that correct?”
“Substantially,” said Galt.
“Did you, as chairman of the finance committee of the Security Life, recommend the purchase of those securities?”
“Yes.”
“And at the same time, as head of the Great Midwestern railway system, you were interested in selling those securities, were you not?”
“We need a great deal of capital,” said Galt. “We are selling new securities all the time. We sell all we can and wish we could sell more. There is always more work to do than we can find the money for.”
“So, Mr. Galt, it comes to this: As head of a great railroad system you create securities which you are anxious to sell. In that rôle you are a seller. Then as chairman of the finance committee of the Security Life Insurance Company, acting as trustee for the policy holders, you are a buyer of securities. In that position of trust, with power to say how the policy holders’ money shall be invested, you recommend the purchase of securities in which you are interested as a seller. Is that true?”
“I don’t like the way you put it, but let it stand,” said Galt.
“How can you justify that, Mr. Galt? Is it right, do you think, that a trustee should buy with one hand what he sells with the other?”
Galt leaned over, beating the table slowly with his fist.
“I justify it this way,” he said. “I know all about the securities of the Great Midwestern. I don’t know of anything better for the Security Life to put its money into. If you can tell me of anything better I will advise the finance committee at its next meeting to sell all of its Great Midwestern stuff and buy that, whatever it is. I’ll do more. If you can tell me of anything better I will sell all of my own Great Midwestern
stocks and bonds and buy that instead. I have my own money in Great Midwestern. There’s another Galt you left out. As head of a great railway system I am a seller of securities to investors all over the world. That is how we find the capital to build our things. But as an individual I am a buyer of those same securities. I sell to everybody with one hand and buy for myself all that I can with the other hand. Do you see the point? I buy them because I know what they are worth. I recommend them to the Security Life because I know what they are worth. That is how I justify it, sir.”
Enough of that Goldfuss had meant to go from the Security Life to each of the other financial insitutions controlled by Galt, meaning to show how he had been unloading Galt securities upon them. But what was the use? What could he do with an answer like that? He passed instead to the Orient & Pacific matter. Galt admitted that he had used the power of majority stockholder to make the property subservient to the Great Midwestern because that was the efficient thing to do.
“And that, you think, is a fair way to treat minority stockholders?” Goldfuss asked.
“We were willing at any time to buy them out at the market price,” said Galt. “However, that’s now an academic matter. The Great Midwestern has acquired all that minority interest in Orient & Pacific.”
This was news. There was a stir at the reporters’ table. Several rose and went out to telegraph Galt’s statement to Wall Street, where nobody yet knew how Bullguard & Co. had made peace with him.
So they went from one thing to another. They came to that notorious land transaction on account of which he had been sued.
“We needed that land for an important piece of railroad development,” said Galt. “Some land traders got wind of our plans, formed a syndicate, bought up all the ground around, and then tried to make us buy it through the nose. We simply sat tight until they went broke. Then we took it off their hands. There was more than the Great Midwestern needed because they were hogs. The Great Midwestern took what it wanted and I took the rest. The directors knew all about it.”
“And it was very profitable to you personally, this outcome?”
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