Sentiment did indeed begin to shift, but not in the direction Roosevelt desired. Troubled by the passage of the regulatory bill in the House, the railroads launched a sweeping propaganda campaign to turn the country against regulation. Lengthy hearings before the Senate Interstate Commerce Committee provided the opening salvo. Organized by senators sympathetic to the railroads, the six-week proceeding featured a witness list stacked to thwart regulatory efforts. Over two thirds of the witnesses, one reporter from Utah noted, “were either friendly toward or in fear of the railroads and testified accordingly.” One after another, railroad executives argued that Roosevelt’s bill was misguided at best and unconstitutional at worst. They pointed out “how delicate and difficult a task it was to adjust a freight-rate, how it required long practical experience,” intimating that disaster would follow if the government “should meddle” in the complex business. “Any tinkering with rates would raise Cain with stocks,” one railway head warned. “It would mean a general unsettling of affairs.”
Forced to travel to Washington at their own expense, the few witnesses who spoke in favor of regulation were mocked and labeled as agitators. Railroad king James J. Hill likened the commotion over regulation to “an attack of ‘pink-eye’ or the grippe,” which would eventually run its course. Members of the Senate committee did nothing to stop such belittling attacks. Congressmen who had voted for Roosevelt’s bill in the House were blacklisted from receiving any further free passes. Not surprisingly, newspapermen attending the hearings were influenced by the strength of the opposition, and the national coverage soon turned sharply negative. A prominent Republican senator claimed that the president was looking for a way out, that he had finally realized his ill-considered foray into this arena might “throw the country into a panic.”
To counter rumors that he had ceded the possibility of reform, Roosevelt dispatched Taft to a conference of three hundred railway executives meeting at the Willard Hotel. Vehemently reinforcing the administration’s commitment to regulation, Taft spoke of the certain advent of railway rate legislation, warning that “if the railway men of the country were wise they would aid and not hinder it.” The industry must recognize, he insisted, “that railroads are a public institution—an institution which must be regulated by law. You cannot run the railroads as you would run a private business. You must respond to the public demand.”
Taft’s words were greeted with “absolute silence,” until Stuyvesant Fish, president of the Railway Congress, jumped to his feet and exhaustively countered Taft’s arguments. The laws already on the books were sufficient to deal with any difficulties, he declared, arguing that the action proposed would cause more harm than good. When he took his seat amid great applause, Taft respectfully asked: “May I have fifteen minutes to reply?” His rebuttal rendered an even more forceful defense of the necessity for a tribunal with powers to revise unfair rates. Taft’s words, “driven directly into the ears of the men who are most determined that there shall be no railroad legislation,” created “a sensation.” Observers understood that the secretary’s address “had been carefully prepared, and prepared with the intention of causing exactly the impression that was caused.”
The following day, Roosevelt endorsed Taft’s speech by flatly stating that his own stance on the subject of the railroads “could not have been better expressed.” Railroad magnates needed to understand that it was “essential, in the interests of the public,” that the government assume a regulatory power over them. Furthermore, he vowed that if this power were awarded, it would be exercised with justice to both the captains of industry and the American people. Roosevelt repeatedly stressed that “the spirit of demagoguery” must not dictate legislative policy. “If we attack unjustly the proper rights of others because they are wealthy,” he was careful to maintain, “we shall do ourselves just as much damage as if we permitted an attack upon those who are poor, because they are poor.” He recognized that “the rock of class hatred” was “the greatest and most dangerous rock in the course of any republic.” But the time for action had come. If Congress refused to advance the administration’s moderate proposal, more radical demands would inevitably gain momentum.
Convinced now of the president’s resolve, editorials predicted “a fight to the finish between the railroads and the administration.” Nonetheless, The Washington Post reported, “an impression prevailed during the summer that the railroad interests were making such a campaign . . . that there was very grave doubt of any legislation of that character passing in the coming Congress.”
BY SUMMER’S END, BAKER HAD completed his research and commenced writing a six-part, 50,000-word series, entitled “The Railroads on Trial.” To herald the upcoming articles, McClure published a lengthy editorial announcement claiming that “the vitality of democracy” depended on “popular knowledge of complex questions.” With regulatory legislation that would impact the entire nation under debate in Congress, the public needed to understand how railroads determined differential rates, whether they conspired to stifle competition, how goods were classified, and how private cars and midnight tariffs operated. The American people, not economists and sociologists, would ultimately have to assess whether a few great men, “like the barons of old,” had become “more powerful than the sovereign himself.”
Mindful of the president’s earlier request to look over his railroad articles before publication, Baker wrote in early September to ask if Roosevelt still wanted to review his first installment, scheduled to appear in the November issue. “Yes, I should greatly like to see the proof,” Roosevelt assured him the very next day. “I have learned to look to your articles for real help. You have impressed me with your earnest desire to be fair, with your freedom from hysteria and with your anxiety to tell the truth.” Baker later recalled his trepidation after sending off the piece, aware that the president’s “approval might be the measure of the usefulness of the entire series [he] had planned.” If Roosevelt found his arguments compelling, Baker could employ “the incomparable sounding board of the White House” in his endeavor to educate the public. Five days later, Baker was elated and much relieved by Roosevelt’s response: “I haven’t a criticism to suggest.” Indeed, the president graciously acknowledged, “you have given me two or three thoughts for my own message.”
In clear, powerful language, Baker explained how, despite the Elkins Act that barred cash rebates, the railroads still managed to build in special rates. They had devised a schedule that favored products carried by the trusts through clever classification of goods and commodities. “In the early days of the Railroad,” Baker pointed out, “the Rate was fixed exactly as it was on a turnpike—a regular toll, for so many miles, so much of a charge.” As railroads had begun to consolidate, however, the small circle of controlling owners adopted the principle of “charging what the traffic will bear,” providing preferential treatment to the trusts while forcing exorbitant rates on small shippers. When great clients like the Armours, the Rockefellers, or the Morgans desired special privileges, they were easily arranged—given that such families generally sat on the boards of these very same railroads.
Although “the fundamental purpose of all law,” Baker argued, “is to do justice between strong and weak, between large and small,” the railroads and the trusts had conspired “to build up and enforce the old favoritism to the strong.” For the first time, Baker boldly suggested that railroad rates had become the fulcrum of a new political contest that set “a progressive party seeking to give the government more power in business affairs” against “a conservative party striving to retain all the power possible in private hands.”
In thanking the president for reviewing his proofs, Baker took the occasion to warn him that the mood in the Midwest had become highly volatile; failure to pass regulatory legislation, he predicted, would foment “violent agitation” and calls for radical action. “The country was never at a more critical point in its career,” the reporter observed, nor had it “ever had a bet
ter opportunity of handling its problem correctly. I wish, Mr. President—and you will pardon my freedom—that there were a Taft for the Bureau of Commerce and Labor. To my thinking there is no more important place now in the gift of government.”
A few weeks later, Baker was amazed to receive a letter from the president, containing a “strictly confidential” partial draft from his annual message dealing with the corporations. “Will you give me any comments,” Roosevelt asked, “which your experiences teach you ought to be made thereon?” In eight weeks, the president would deliver his State of the Union speech, and Baker reflected solemnly upon “the seriousness of the responsibility” granted to him. “I knew perfectly well how little I really knew about the complicated problems involved in the new legislation,” he later wrote; “but then, who was there at that time who did?”
The reporter carefully weighed Roosevelt’s language. Heartened by the president’s willingness to make railroad regulation his first priority, he found the tone of the draft message disappointing: “It was too general, there was too much of the President’s favorite balancing of good and evil.” Baker applauded Roosevelt’s drive to empower the Interstate Commerce Commission to revise the disputed freight rates but deplored his proposal to limit the Commission’s authority to merely prescribing a maximum rate limit. “I was terribly afraid that he was plumping for a solution that, while it might help a little, and look good politically, would fail to reach the heart of the matter,” Baker recalled.
The research for Baker’s second article, which detailed all manner of new rebate chicanery, had convinced him that the trusts didn’t care what the rate was, so long as they enjoyed a better rate than everyone else. The differential provided their advantage and allowed them to crush their competitors. Beyond their clever freight classification schemes, railroads had implemented a host of “cunning devices”—including private cars, refrigerator charges, elevator allowances, underweighing of freight, and variable tariffs. Such measures were specifically designed to lower rates for the great shippers in beef, oil, and steel while raising them “for the farmer, the small struggling manufacturers and shippers.” Believing he had gained a comprehensive understanding of the railroad conspiracy, Baker felt compelled to tell the president plainly that his approach was misguided.
“I have asked myself over and over,” Baker wrote to Roosevelt on November 11, expressing his doubts “whether the power to fix a maximum rate, which you suggest, will touch this specific case of injustice.” He had determined that it would not. The “evil power” of the trusts, he explained, lay in their ability to compel the railroads to give them a lower rate than everyone else. The problem therefore was “not a maximum rate but a minimum rate.” The only solution was to allow the governmental tribunal to “fix a definite rate.”
Roosevelt replied immediately, agreeing that “it would be better if the Commission had the power to fix a definite instead of a maximum rate.” His attorney general had warned him, however, that fixing a definite rate might be unconstitutional. While the maximum rate might not alleviate all problems, he concluded, “we should have first a law that is surely constitutional.” Baker persisted, reiterating in a second letter that merely limiting the maximum rate would not mitigate the terrible inequity in the entire system. “Is there not, then, some practical way,” he entreated, “for reaching the real abuse?” Quoting the abolitionist Wendell Phillips’s remark on historic reforms, Baker challenged the president’s objection: “If they do not succeed with the Constitution, then they must succeed without it.”
There followed “a long and rather heated correspondence” between the two men, spurred by a four-page letter from the president. “I think you are entirely mistaken in your depreciation of what is accomplished by fixing a maximum rate,” Roosevelt declared, arguing that “the insistence upon having only the perfect cure often results in securing no betterment whatever.” Furthermore, he added, “the railroads have been crazy in their hostility to my maximum rate proposition, and evidently do not share in the least your belief that nothing will result from it.” In additional exchanges, Roosevelt branded Baker’s continued fear that the proposed measure would prove insufficient “simply absurd.” He ended the correspondence with a reminder that “it was Lincoln, not Wendell Phillips and the fanatical abolitionists, who was the effective champion of union and freedom.” Confronted by Roosevelt’s strident tone, Baker was certain that his “suggestion would come to nothing.”
“What was my surprise,” Baker later recalled, “when I read the message in its final form as delivered to Congress, to find that the President had inserted a paragraph, almost in my own words, regarding the regulation of minimum rates.” After calling upon Congress to grant an impartial tribunal authority to set “a maximum reasonable rate” when an existing rate was deemed “unreasonable and unjust,” Roosevelt laid out a far more comprehensive proposal: “It sometimes happens at present not that a rate is too high but that a favored shipper is given too low a rate. In such cases the commission would have the right to fix this already established minimum rate as the maximum; and it would need only one or two such decisions by the commission to cure railroad companies of the practice of giving improper minimum rates.” Finally, he urged Congress to grant the ICC supervision of private-car lines, elevator allowances, refrigerator charges, and industrial roads—all the devices Baker had exposed as subtle mechanisms of discrimination.
ON JANUARY 4, 1906, COLONEL William Hepburn, chairman of the Interstate and Foreign Commerce Committee, reported the administration-backed railroad bill to the floor of the House. As Roosevelt had outlined in his annual message, the bill gave the ICC the authority to determine a “just and reasonable” maximum for disputed rates. Though it was essentially a moderate bill, it nonetheless challenged “the most hoary tenet of free private enterprise”—the right to independently set prices according to supply and demand.
While Speaker Joseph Cannon could have easily exercised his absolute control over House procedure to prevent the bill from reaching the floor, he had allowed it to move forward. In exchange, the president had agreed to preserve the protective tariff—an issue the Old Guard considered even more vital than railroad regulation. Popular resentment toward the railroads was such that once the bill reached the floor, the outcome was clear. The overwhelming vote to pass the Hepburn bill on February 8 “was in many ways the most spectacular piece of politics ever witnessed at the Capitol,” The Washington Post remarked, noting that a bill vitally affecting over $15 billion of property had passed “without the addition of a single amendment.”
The following day, Roosevelt invited Ray Baker to join him during his afternoon shave. Baker professed his belief that “this railroad legislation was the most important of the President’s administration” but “only a first step” toward broader reform. His investigations throughout the West had convinced the journalist that the public was moving beyond the president’s position, even pushing for “governmental ownership of the railroad.” Roosevelt vehemently disagreed, twisting so abruptly toward Baker that the barber had to flinch quickly to avoid cutting the president’s chin. “I do not represent public opinion: I represent the public,” Roosevelt passionately countered, insisting, “I must represent not the excited opinion of the West but the real interests of the whole people.” Those interests would be ill served, he curtly rejoined, by turning the operation of the railroads over to government employees, for “he knew better than anyone else could how inefficient & undependable” they were. The Hepburn bill, Roosevelt insisted, would address most of the problems. Rather than speculate on future steps, he must focus on the U.S. Senate, where he faced perhaps the climactic struggle of his administration.
A battle royal was predicted between the president and the conservative senators, led by Nelson Aldrich. Public pressure precluded an outright assault on the bill, yet Aldrich and his colleagues remained confident that they could produce a final bill “so whittled down” by amendments “as to
be practically worthless.” Roosevelt was clearly prepared for such tactics: “They are making every effort to have some seemingly innocent amendment put in,” he explained to Kermit, “which shall destroy something of what I am endeavoring to accomplish.”
To forestall these inevitable efforts to gut the bill, Roosevelt declared unequivocally that he wished the Senate to pass the Hepburn bill without amendments. His statement produced “great indignation among the conservative senators.” The chief executive, they insisted, had no business meddling in their deliberations. His presumptuous intervention showed a woeful disregard of the Senate’s historic role “as a check upon the half-baked and demagogic bills passed by the lower house.”
Roosevelt’s push to get the bill unamended through the Senate Interstate Commerce Committee rested on the leadership of Iowa’s junior senator, Jonathan Dolliver. A young progressive, Dolliver worked doggedly to produce a majority vote and deliver what would become the Dolliver/Hepburn bill to the floor. Of the eight Republicans, he won the support of three—all from the West where agitation for railroad control was most intense. Combined with five Democrats who had long favored regulatory control, they formed the slim majority Dolliver needed to bring the bill to the floor.
Conceding that he had lost in committee, Aldrich deftly contrived a deal with the Democrats: He would give Benjamin Tillman, the ranking Democrat from South Carolina, the honor of leading the fight on the floor in Dolliver’s place. In turn, Democrats agreed to report the unamended bill “without prejudice,” thereby allowing amendments to be freely offered during debate on the floor. This gambit astonished even the most seasoned journalists. The fact that Roosevelt’s “most outspoken opponent” was “put in charge of the administration’s pet measure,” one Ohio paper remarked, was “considered so audacious a piece of irony that it has made the country gasp.” Fully aware that Republicans controlled nearly two thirds of the Senate, Tillman himself “scarcely had time to pinch himself to see if he were really awake.”
The Bully Pulpit: Theodore Roosevelt, William Howard Taft, and the Golden Age of Journalism Page 65
