You are clever men,but you are building up monopolies which we propose to stop.'`By what means?'"I asked."`Rebates,for one,'said he,`you get preferential rates from your railroad which give you advantages over your competitors.'Foolishness!"Mr.Scherer exclaimed."I tell him the railroad is a private concern,built up by private enterprise,and it has a right to make special rates for large shippers.No,--railroads are public carriers with no right to make special rates.I ask him what else he objects to,and he says patented processes.As if we don't have a right to our own patents!We buy them.I buy them,when other steel companies won't touch 'em.What is that but enterprise,and business foresight,and taking risks?And then he begins to talk about the tariff taking money out of the pockets of American consumers and making men like me rich.I have come to Washington to get the tariff raised on steel rails;and Watling and other senators we send down there are raising it for us.
We are building up monopolies!Well,suppose we are.We can't help it,even if we want to.Has he ever made a study of the other side of the question--the competition side?Of course he hasn't."He brought down his beer mug heavily on the table.In times of excitement his speech suggested the German idiom.Abruptly his air grew mysterious;he glanced around the room,now becoming empty,and lowered his voice.
"I have been thinking a long time,I have a little scheme,"he said,"and I have been to Washington to see Watling,to talk over it.Well,he thinks much of you.Fowndes and Ripon are good lawyers,but they are not smart like you.See Paret,he says,and he can come down and talk to me.
So I ask you to come here.That is why I say you are wise to get home.
Honeymoons can wait--eh?"
I smiled appreciatively.
"They talk about monopoly,those Populist senators,but I ask you what is a man in my place to do?If you don't eat,somebody eats you--is it not so?Like the boa-constrictors--that is modern business.Look at the Keystone Plate people,over there at Morris.For years we sold them steel billets from which to make their plates,and three months ago they serve notice on us that they are getting ready to make their own billets,they buy mines north of the lakes and are building their plant.Here is a big customer gone.Next year,maybe,the Empire Tube Company goes into the business of making crude steel,and many more thousands of tons go from us.What is left for us,Paret?""Obviously you've got to go into the tube and plate business yourselves,"I said.
"So!"cried Mr.Scherer,triumphantly,"or it is close up.We are not fools,no,we will not lie down and be eaten like lambs for any law.
Dickinson can put his hand on the capital,and I--I have already bought a tract on the lakes,at Bolivar,I have already got a plant designed with the latest modern machinery.I can put the ore right there,I can send the coke back from here in cars which would otherwise be empty,and manufacture tubes at eight dollars a ton less than they are selling.If we can make tubes we can make plates,and if we can make plates we can make boilers,and beams and girders and bridges....It is not like it was but where is it all leading,my friend?The time will come--is right on us now,in respect to many products--when the market will be flooded with tubes and plates and girders,and then we'll have to find a way to limit production.And the inefficient mills will all be forced to shut down."The logic seemed unanswerable,even had I cared to answer it....He unfolded his campaign.The Boyne Iron Works was to become the Boyne Iron Works,Ltd.,owner of various subsidiary companies,some of which were as yet blissfully ignorant of their fate.All had been thought out as calmly as the partition of Poland--only,lawyers were required;and ultimately,after the process of acquisition should have been completed,a delicate document was to be drawn up which would pass through the meshes of that annoying statutory net,the Sherman Anti-trust Law.New mines were to be purchased,extending over a certain large area;wide coal deposits;little strips of railroad to tap them.The competition of the Keystone Plate people was to be met by acquiring and bringing up to date the plate mills of King and Son,over the borders of a sister state;the Somersworth Bridge and Construction Company and the Gring Steel and Wire Company were to be absorbed.When all of this should have been accomplished,there would be scarcely a process in the steel industry,from the smelting of the ore to the completion of a bridge,which the Boyne Iron Works could not undertake.Such was the beginning of the "lateral extension"period.
"Two can play at that game,"Mr.Scherer said."And if those fellows could only be content to let well enough alone,to continue buying their crude steel from us,there wouldn't be any trouble."...
It was evident,however,that he really welcomed the "trouble,"that he was going into battle with enthusiasm.He had already picked out his points of attack and was marching on them.Life,for him,would have been a poor thing without new conflicts to absorb his energy;and he had already made of the Boyne Iron Works,with its open-hearth furnaces,a marvel of modern efficiency that had opened the eyes of the Steel world,and had drawn the attention of a Personality in New York,--a Personality who was one of the new and dominant type that had developed with such amazing rapidity,the banker-dinosaur;preying upon and superseding the industrial-dinosaur,conquering type of the preceding age,builder of the railroads,mills and manufactories.The banker-dinosaurs,the gigantic ones,were in Wall Street,and strove among themselves for the industrial spoils accumulated by their predecessors.It was characteristic of these monsters that they never fought in the open unless they were forced to.
