Heredity has much to do with a man's career. The village of Peekskill-on-the-Hudson, about forty miles from New York, was in the early days the market-town of a large section of the surrounding country, extending over to the State of Connecticut. It was a farming region, and its products destined for New York City were shipped by sloops on the Hudson from the wharfs at Peekskill, and the return voyage brought back the merchandise required by the country.
My father and his brother owned the majority of the sloops engaged in this, at that time, almost the only transportation. The sloops were succeeded by steamboats in which my people were also interested. When Commodore Vanderbilt entered into active rivalry with the other steamboat lines between New York and Albany, the competition became very serious. Newer and faster boats were rapidly built. These racers would reach the Bay of Peekskill in the late afternoon, and the younger population of the village would be on the banks of the river, enthusiastically applauding their favorites. Among well-known boats whose names and achievements excited as much interest and aroused as much partisanship and sporting spirit as do now famous race-horses or baseball champions, were the following: Mary Powell, Dean Richmond, The Alida, and The Hendrick Hudson.
I remember as if it were yesterday when the Hudson River Railroad had reached Peekskill, and the event was locally celebrated. The people came in as to a county fair from fifty miles around. When the locomotive steamed into the station many of those present had never seen one. The engineer was continuously blowing his whistle to emphasize the great event. This produced much consternation and confusion among the horses, as all farmers were there with their families in carriages or wagons.
I recall one team of young horses which were driven to frenzy; their owner was unable to control them, but he kept them on the road while they ran away with a wild dash over the hills. In telling this story, as illustrating how recent is railway development in the United States, at a dinner abroad, I stated that as far as I knew and believed, those horses were so frightened that they could not be stopped and were still running. A very successful and serious-minded captain of industry among the guests sternly rebuked me by saying: "Sir, that is impossible; horses were never born that could run for twenty-five years without stopping." American exaggeration was not so well known among our friends on the other side then as it is now.
As we boys of the village were gathered on the banks of the Hudson cheering our favorite steamers, or watching with eager interest the movements of the trains, a frequent discussion would be about our ambitions in life. Every young fellow would state a dream which he hoped but never expected to be realized. I was charged by my companions with having the greatest imagination and with painting more pictures in the skies than any of them. This was because I stated that in politics, for I was a great admirer of William H. Seward, then senator from New York, I expected to be a United States senator, and in business, because then the largest figure in the business world was Commodore Vanderbilt, I hoped to become president of the Hudson River Railroad. It is one of the strangest incidents of what seemed the wild imaginings of a village boy that in the course of long years both these expectations were realized.
When I entered the service of the railroad on the first of January, 1866, the Vanderbilt system consisted of the Hudson River and Harlem Railroads, the Harlem ending at Chatham, 128 miles, and the Hudson River at Albany, 140 miles long. The Vanderbilt system now covers 20,000 miles. The total railway mileage of the whole United States at that time was 36,000, and now it is 261,000 miles.
My connection with the New York Central Railroad covers practically the whole period of railway construction, expansion, and development in the United States. It is a singular evidence of the rapidity of our country's growth and of the way which that growth has steadily followed the rails, that all this development of States, of villages growing into cities, of scattered communities becoming great manufacturing centres, of an internal commerce reaching proportions where it has greater volume than the foreign interchanges of the whole world, has come about during a period covered by the official career of a railroad man who is still in the service: an attorney in 1866, a vice-president in 1882, president in 1885, chairman of the board of directors in 1899, and still holds that office.
There is no such record in the country for continuous service with one company, which during the whole period has been controlled by one family. This service of more than half a century has been in every way satisfactory. It is a pleasure to see the fourth generation, inheriting the ability of the father, grandfather, and great-grandfather, still active in the management.
I want to say that in thus linking my long relationship with the railroads to this marvellous development, I do not claim to have been better than the railway officers who during this time have performed their duties to the best of their ability. I wish also to pay tribute to the men of original genius, of vision and daring, to whom so much is due in the expansion and improvement of the American railway systems.
Commodore Vanderbilt was one of the most remarkable men our country has produced. He was endowed with wonderful foresight, grasp of difficult situations, ability to see opportunities before others, to solve serious problems, and the courage of his convictions. He had little education or early advantages, but was eminently successful in everything he undertook. As a boy on Staten Island he foresaw that upon transportation depended the settlement, growth, and prosperity of this nation. He began with a small boat running across the harbor from Staten Island to New York. Very early in his career he acquired a steamboat and in a few years was master of Long Island Sound. He then extended his operations to the Hudson River and speedily acquired the dominating ownership in boats competing between New York and Albany.
When gold was discovered in California he started a line on the Atlantic side of the Isthmus of Darien and secured from the government of Nicaragua the privilege of crossing the Isthmus for a transportation system through its territory, and then established a line of steamers on the Pacific to San Francisco. In a short time the old-established lines, both on the Atlantic and the Pacific, were compelled to sell out to him. Then he entered the transatlantic trade, with steamers to Europe.
With that vision which is a gift and cannot be accounted for, he decided that the transportation work of the future was on land and in railroads. He abandoned the sea, and his first enterprise was the purchase of the New York and Harlem Railroad, which was only one hundred and twenty-eight miles long. The road was bankrupt and its road-bed and equipment going from bad to worse. The commodore reconstructed the line, re-equipped it, and by making it serviceable to its territory increased its traffic and turned its business from deficiency into profit. This was in 1864. The commodore became president, and his son, William H. Vanderbilt, vice-president. He saw that the extension of the Harlem was not advisable, and so secured the Hudson River Railroad, running from New York to Albany, and became its president in 1865. It was a few months after this when he and his son invited me to become a member of their staff.
The station of the Harlem Railroad in the city of New York was at that time at Fourth Avenue and Twenty-sixth Street, and that of the Hudson River Railroad at Chambers Street, near the North River.
In a few years William H. Vanderbilt purchased the ground for the Harlem Railroad Company, where is now located the Grand Central Terminal, and by the acquisition by the New York Central and Hudson River Railroad of the Harlem Railroad the trains of the New York Central were brought around into the Grand Central Station.
In 1867, two years after Mr. Vanderbilt had acquired the Hudson River Railroad, he secured the control of the New York Central, which ran from Albany to Buffalo. This control was continued through the Lake Shore on one side of the lakes and the Michigan Central on the other to Chicago. Subsequently the Vanderbilt System was extended to Cincinnati and St. Louis. It was thus in immediate connection with the West and Northwest centering in Chicago, and the Southwest at Cincinnati and St. Louis. By close connection and affiliation with the Chicago and Northwestern Railway Company, the Vanderbilt system was extended beyond to Mississippi. I became director in the New York Central in 1874 and in the Chicago and Northwestern in 1877.
It has been my good fortune to meet with more or less intimacy many of the remarkable men in every department of life, but I think Commodore Vanderbilt was the most original. I had been well acquainted for some years both with the commodore and his son, William H. When I became attorney my relations were more intimate than those usually existing. I was in daily consultation with the commodore during the ten years prior to his death, and with his son from 1866 to 1885, when he died.
The commodore was constantly, because of his wealth and power, importuned by people who wished to interest him in their schemes. Most of the great and progressive enterprises of his time were presented to him. He would listen patiently, ask a few questions, and in a short time grasp the whole subject. Then with wonderful quickness and unerring judgment he would render his decision. No one knew by what process he arrived at these conclusions. They seemed to be the results as much of inspiration as of insight.
The Civil War closed in 1865, and one of its lessons had been the necessity for more railroads. The country had discovered that without transportation its vast and fertile territories could neither be populated nor made productive. Every mile of railroad carried settlers, opened farms and increased the national resources and wealth. The economical and critical conditions of the country, owing to the expansion of the currency and banking conditions, facilitated and encouraged vast schemes of railroad construction. This and a wild speculation resulted in the panic of 1873. Nearly the whole country went bankrupt. The recovery was rapid, and the constructive talent of the Republic saw that the restoration of credit and prosperity must be led by railway solvency. In August, 1874, Commodore Vanderbilt invited the representatives of the other and competitive lines to a conference at Saratoga. Owing, however, to the jealousies and hostilities of the period, only the New York Central, the Pennsylvania, and the Erie railways were represented.
The eastern railway situation was then dominated by Commodore Vanderbilt, Colonel Thomas A. Scott, of the Pennsylvania, and John W. Garrett, of the Baltimore and Ohio. Both Scott and Garrett were original men and empire builders. There was neither governmental nor State regulation. The head of a railway system had practically unlimited power in the operation of his road. The people were so anxious for the construction of railways that they offered every possible inducement to capital. The result was a great deal of unprofitable construction and immense losses to the promoters.
These able men saw that there was no possibility of railway construction, operation, and efficiency, with a continuance of unrestricted competition. It has taken from 1874 until 1920 to educate the railway men, the shippers, and the government to a realization of the fact that transportation facilities required for the public necessities can only be had by the freest operations and the strictest government regulations; that the solution of the problem is a system so automatic that public arbitration shall decide the justice of the demands of labor, and rates be advanced to meet the decision, and that public authority also shall take into consideration the other factors of increased expenses and adequate facilities for the railroads, and that maintenance and the highest efficiency must be preserved and also necessary extensions. To satisfy and attract capital there must be the assurance of a reasonable return upon the investment.
The meeting called by Commodore Vanderbilt in 1874, at Saratoga, was an epoch-making event. We must remember the railway management of the country was in the absolute control of about four men, two of whom were also largest owners of the lines they managed. Fierce competition and cutting of rates brought on utter demoralization among shippers, who could not calculate on the cost of transportation, and great favoritism to localities and individuals by irresponsible freight agents who controlled the rates. Under these influences railway earnings were fluctuating and uncertain. Improvements were delayed and the people on the weaker lines threatened with bankruptcy.
Public opinion, however, believed this wild competition to be the only remedy for admitted railway evils. As an illustration of the change of public opinion and the better understanding of the railway problems, this occurred in the month of October, 1920. A committee of shippers and producers representing the farmers, manufacturers, and business men along a great railway system came to see the manager of the railroad and said to him: "We have been all wrong in the past. Our effort has always been for lower rates, regardless of the necessities of the railways. We have tried to get them by seeking bids from competing lines for our shipments and by appealing to the Interstate Commerce Commission. The expenses of the railroads have been increased by demands of labor, by constantly rising prices and cost of rails, cars, terminals, and facilities, but we have been against allowing the railroads to meet this increased cost of operation by adequate advances in rates. We now see that this course was starving the railroads, and we are suffering for want of cars and locomotives to move our traffic and terminals to care for it. We are also suffering because the old treatment of the railroads has frightened capital so that the roads cannot get money to maintain their lines and make necessary improvements to meet the demands of business. We know now that rates make very little difference, because they can be absorbed in our business. What we must have is facilities to transport our products, and we want to help the railroads to get money and credit, and again we emphasize our whole trouble is want of cars, locomotives, and terminal facilities."
Happily, public opinion was reflected in the last Congress in the passage of the Cummins-Esch bill, which is the most enlightened and adaptable legislation of the last quarter of a century.
To return to the conference at Saratoga, the New York Central, the Pennsylvania, and the Erie came to the conclusion that they must have the co-operation of the Baltimore and Ohio. As Mr. Garrett, president and controlling owner of that road, would not come to the conference, the members decided that the emergency was so great that they must go to him. This was probably the most disagreeable thing Commodore Vanderbilt ever did. The marvellous success of his wonderful life had been won by fighting and defeating competitors. The peril was so great that they went as associates, and the visit interested the whole country and so enlarged Mr. Garrett's opinion of his power that he rejected their offer and said he would act independently. A railway war immediately followed, and in a short time bankruptcy threatened all lines, and none more than the Baltimore and Ohio.
The trunk lines then got together and entered into an agreement to stabilize rates and carry them into effect. They appointed as commissioner Mr. Albert Fink, one of the ablest railway men of that time. Mr. Fink's administration was successful, but the rivalries and jealousies of the lines and the frequent breaking of agreements were too much for one man.
The presidents and general managers of all the railroads east of Chicago then met and formed an association, and this association was a legislative body without any legal authority to enforce its decrees. It had, however, two effects: the disputes which arose were publicly discussed, and the merits of each side so completely demonstrated that the decision of the association came to be accepted as just and right. Then the verdict of the association had behind it the whole investment and banking community and the press. The weight of this was sufficient to compel obedience to its decisions by the most rebellious member. No executive could continue to hold his position while endeavoring to break up the association.
It is one of the most gratifying events of my life that my associates in this great and powerful association elected me their president, and I continued in office until the Supreme Court in a momentous decision declared that the railroads came under the provision of the Sherman Anti-Trust Law and dissolved these associations in the East, West, and South.
It was a liberal education of the railway problems to meet the men who became members of this association. Most of them left an indelible impression upon the railway conditions of the time and of the railway policies of the future. All were executives of great ability and several rare constructive geniuses.
In our system there was John Newell, president of the Lake Shore and Michigan Southern, a most capable and efficient manager. Henry B. Ledyard, president of the Michigan Central, was admirably trained for the great responsibilities which he administered so well. There was William Bliss, president of the Boston and Albany, who had built up a line to be one of the strongest of the New England group.
Melville E. Ingalls, president of the Cleveland, Cincinnati, Chicago and St. Louis, had combined various weak and bankrupt roads and made them an efficient organization. He had also rehabilitated and put in useful working and paying condition the Chesapeake and Ohio.
Ingalls told me a very good story of himself. He had left the village in Maine, where he was born, and after graduation from college and admission to the bar had settled in Boston. To protect the interests of his clients he had moved to Cincinnati, Ohio, and rescued railroad properties in which they were interested. When his success was complete and he had under his control a large and successfully working railway system, he made a visit to his birthplace.
One evening he went down to the store where the village congress was assembled, sitting on the barrels and the counter. They welcomed him very cordially, and then an inquisitive farmer said to him: "Melville, it is reported around here that you are getting a salary of nigh unto ten thousand dollars a year."
Mr. Ingalls, who was getting several times that amount, modestly admitted the ten, which was a prodigious sum in that rural neighborhood. Whereupon the old farmer voiced the local sentiment by saying: "Well, Melville that shows what cheek and circumstances can do for a man."
I recall an incident connected with one of the ablest of the executives in our system. One day we had a conference of rival interests, and many executives were there in the effort to secure an adjustment. For this purpose we had an arbitrator. After a most exhausting day in the battle of wits and experience for advantages, I arrived home used up, but after a half-hour's sleep I awoke refreshed and, consulting my diary, found I was down for a speech at a banquet at Delmonico's that night.
I arrived late, the intervening time being devoted to intensive and rapid preparation. I was called early. The speech attracted attention and occupied a column in the morning's papers. I was in bed at eleven o'clock and had between seven and eight hours' refreshing sleep.
On arriving at our meeting-place the next morning, one of the best-known presidents took me aside and said: "Chauncey, by making speeches such as you did last night you are losing the confidence of the people. They say you cannot prepare such speeches and give proper attention to your business."
"Well," I said to him, "my friend, did I lose anything before the arbitrator yesterday?"
He answered very angrily: "No, you gained entirely too much."
"Well," I then said, "I am very fresh this morning. But what did you do last night?"
He answered that he was so exhausted that he went to Delmonico's and ordered the best dinner possible. Then he went on to say: "A friend told me a little game was going on up-stairs, and in a close room filled with tobacco smoke I played poker until two o'clock and drank several high-balls. The result is, I think we better postpone this meeting, for I do not feel like doing anything to-day."
"My dear friend," I said, "you will get the credit of giving your whole time to business, while I am by doing what refreshes my mind discredited, because it gets in the papers. I shall keep my method regardless of consequences."
He kept his, and although much younger than myself died years ago.
George B. Roberts, president of the Pennsylvania, was a very wise executive and of all-around ability. Frank Thompson, vice-president and afterwards president of the same road, was one of the ablest operating officers of his time and a most delightful personality. Mr. A. J. Cassatt was a great engineer and possessed rare foresight and vision. He brought the Pennsylvania into New York City through a tunnel under the Hudson River, continued the tunnel across the city to the East River and then under the river to connect with the Long Island, which he had acquired for his system.
D. W. Caldwell, president of the New York, Chicago, and St. Louis, added to railway ability wit and humor. He told a good story on Mr. George Roberts. Caldwell was at one time division superintendent under President Roberts. He had obtained permission to build a new station-house, in whose plan and equipment he was deeply interested. It was Mr. Roberts's habit, by way of showing his subordinates that he was fully aware of their doings, to either add or take away something from their projects.
Caldwell prepared a station-house according to his ideas, and, to prevent Roberts from making any essential changes he added an unnecessary bay window to the front of the passengers' room. Roberts carefully examined the plans and said: "Remove that bay window," and then approved the plan, and Caldwell had what he wanted.
Caldwell used to tell of another occasion when on a Western line he had over him a very severe and harsh disciplinarian as president. This president was a violent prohibitionist and had heard that Caldwell was a bonvivant. He sent for Caldwell to discipline or discharge him. After a long and tiresome journey Caldwell arrived at the president's house. His first greeting was: "Mr. Caldwell, do you drink?"
Caldwell, wholly unsuspicious, answered: "Thank you, Mr. President, I am awfully tired and will take a little rye."
Mr. E. B. Thomas, president of the Lehigh Valley, was a valuable member of the association. The Baltimore and Ohio, as usual, had its president, Mr. Charles F. Mayer, accompanied by an able staff. The Erie was represented by one of the most capable and genial of its many presidents, Mr. John King.
King was a capital story-teller, and among them I remember this one: At one time he was general manager of the Baltimore and Ohio under John W. Garrett. In order to raise money for his projected extensions, Garrett had gone to Europe. The times were financially very difficult. Johns Hopkins, the famous philanthropist, died. His immortal monument is the Johns Hopkins University and Medical School. Everybody in Baltimore attended the funeral. Among the leading persons present was another John King, a banker, who was Hopkins's executor. A messenger-boy rushed in with a cable for John King, and handed it to John King, the executor, who sat at the head of the mourners. He read it and then passed it along so that each one could read it until it reached John King, of the Baltimore and Ohio, who sat at the foot of the line. The cable read as follows: "Present my sympathies to the family and my high appreciation of Mr. Johns Hopkins, and borrow from the executor all you can at five per cent. Garrett."
Commodore Vanderbilt was succeeded in the presidency by his son, William H. Vanderbilt, who was then past forty years old and had been a successful farmer on Staten Island. He was active in neighborhood affairs and in politics. This brought him in close contact with the people and was of invaluable benefit to him when he became president of a great railroad corporation. He also acquired familiarity in railway management as a director of one on Staten Island.
Mr. William H. Vanderbilt was a man of great ability, and his education made him in many ways an abler man than his father for the new conditions he had to meet. But, like many a capable son of a famous father, he did not receive the credit which was due him because of the overshadowing reputation of the commodore. Nevertheless, on several occasions he exhibited the highest executive qualities.
One of the great questions of the time was the duty of railroads to the cities in which they terminated, and the decision of the roads south of New York to have lower rates to Philadelphia and Baltimore. New York felt so secure in the strength of its unrivalled harbor and superior shipping facilities that the merchants and financiers were not alarmed. Very soon, however, there was such a diversion of freight from New York as to threaten very seriously its export trade and the superiority of its port. The commercial leaders of the city called upon Mr. Vanderbilt, who after the conference said to them: "I will act in perfect harmony with you and will see that the New York Central Railroad protects New York City regardless of the effect upon its finances." The city representatives said: "That is very fine, and we will stand together."
Mr. Vanderbilt immediately issued a statement that the rates to the seaboard should be the same to all ports, and that the New York Central would meet the lowest rates to any port by putting the same in effect on its own lines. The result was the greatest railroad war since railroads began to compete. Rates fell fifty per cent, and it was a question of the survival of the fittest. Commerce returned to New York, and the competing railroads, to avoid bankruptcy, got together and formed the Trunk Line Association.
New York City has not always remembered how intimately bound is its prosperity with that of the great railroad whose terminal is within its city limits. Mr. Vanderbilt found that the railroad and its management were fiercely assailed in the press, in the legislature, and in municipal councils. He became convinced that no matter how wise or just or fair the railroad might be in the interests of every community and every business which were so dependent upon its transportation, the public would not submit to any great line being owned by one man. The Vanderbilt promptness in arriving at a decision was immediately shown. He called upon Mr. Pierpont Morgan, and through him a syndicate, which Morgan formed, took and sold the greater part of Mr. Vanderbilt's New York Central stock. The result was that the New York Central from that time was owned by the public. It is a tribute to the justice and fairness of the Vanderbilt management that though the management has been submitted every year since to a stockholders' vote, there has practically never been any opposition to a continuance of the Vanderbilt policy and management.
Among the most important of the many problems during Mr. Vanderbilt's presidency was the question of railway commissions, both in national and State governments. In my professional capacity of general counsel, and in common with representatives of other railroads, I delivered argumentative addresses against them. The discussions converted me, and I became convinced of their necessity. The rapidly growing importance of railway transportation had created the public opinion that railway management should be under the control and supervision of some public body; that all passengers or shippers, or those whose land was taken for construction and development, should have an appeal from the decision of the railway managers to the government through a government commission.
As soon as I was convinced that commissions were necessary for the protection of both the public and the railroads, I presented this view to Mr. Vanderbilt. The idea was contrary to his education, training, and opinion. It seemed to me that it was either a commission or government ownership, and that the commission, if strengthened as a judicial body, would be as much of a protection to the bond and stock holders and the investing public as to the general public and the employees. Mr. Vanderbilt, always open-minded, adopted this view and supported the commission system and favored legislation in its behalf.
In 1883 Mr. Vanderbilt decided, on account of illness, to retire from the presidency, and Mr. James H. Rutter was elected his successor. Mr. Rutter was the ablest freight manager in the country, but his health gave way under the exactions of executive duties, and I acted largely for him during his years of service. He died early in 1885, and I was elected president.
The war with the West Shore had been on for several years, with disastrous results to both companies. The Ontario and Western, which had large terminal facilities near Jersey City on the west side of the Hudson, ran for fifty miles along the river before turning into the interior. At its reorganization it had ten millions of cash in the treasury. With this as a basis, its directors decided to organize a new railroad, to be called the West Shore, and parallel the New York Central through its entire length to Buffalo. As the New York Central efficiently served this whole territory, the only business the West Shore could get must be taken away from the Central. To attract this business it offered at all stations lower rates. To retain and hold its business the New York Central met those rates at all points so that financially the West Shore went into the hands of a receiver.
The New York Central was sustained because of its superior facilities and connections and established roadway and equipment. But all new and necessary construction was abandoned, maintenance was neglected, and equipment run down under forced reduction of expenses.
I had very friendly personal relations with the managers and officers of the West Shore, and immediately presented to them a plan for the absorption of their line, instead of continuing the struggle until absolute exhaustion. Mr. Vanderbilt approved of the plan, as did the financial interests represented by Mr. Pierpont Morgan.
By the reorganization and consolidation of the two companies the New York Central began gradually to establish its efficiency and to work on necessary improvements. As evidence of the growth of the railway business of the country, the New York Central proper has added since the reorganization an enormous amount of increased trackage, and has practically rebuilt, as a necessary second line, the West Shore and used fully its very large terminal facilities on the Jersey side of the Hudson.
During his active life Mr. Vanderbilt was very often importuned to buy a New York daily newspaper. He was personally bitterly assailed and his property put in peril by attacks in the press. He always rejected the proposition to buy one. "If," he said, "I owned a newspaper, I would have all the others united in attacking me, and they would ruin me, but by being utterly out of the journalistic field, I find that taking the press as a whole I am fairly well treated. I do not believe any great interest dealing with the public can afford to have an organ."
Colonel Scott, of the Pennsylvania, thought otherwise, but the result of his experiment demonstrated the accuracy of Mr. Vanderbilt's judgment. Scott selected as editor of the New York World one of the most brilliant journalistic writers of his time, William H. Hurlburt. When it became known, however, that the World belonged to Colonel Scott, Hurlburt's genius could not save it. The circulation ran down to a minimum, the advertising followed suit, and the paper was losing enormously every month. Mr. Joseph Pulitzer, with the rare insight and foresight which distinguished him, saw what could be made of the World, with its privileges in the Associated Press, and so he paid Scott the amount he had originally invested, and took over and made a phenomenal success of this bankrupt and apparently hopeless enterprise.
I tried during my presidency to make the New York Central popular with the public without impairing its efficiency. The proof of the success of this was that without any effort on my part and against my published wishes the New York delegation in the national Republican convention in 1888, with unprecedented unanimity presented me as New York's candidate for president. I retired from the contest because of the intense hostility to railroad men in the Western States. Those States could not understand how this hostility, which they had to railroads and everybody connected with them, had disappeared in the great State of New York.
During my presidency the labor question was very acute and strikes, one after another, common. The universal method of meeting the demands of labor at that time was to have a committee of employees or a leader present the grievances to the division superintendent or the superintendent of motive power. These officers were arbitrary and hostile, as the demands, if acceded to, led to an increase of expenses which would make them unpopular with the management. They had a difficult position. The employees often came to the conclusion that the only way for them to compel the attention of the higher officers and directors was to strike.
Against the judgment of my associates in the railway management I decided to open my doors to any individual or committee of the company. At first I was overwhelmed with petty grievances, but when the men understood that their cases would be immediately heard and acted upon, they decided among themselves not to bring to me any matters unless they regarded them of vital importance. In this way many of the former irritations, which led ultimately to serious results, no longer appeared.
I had no trouble with labor unions, and found their representatives in heart-to-heart talks very generally reasonable. Mr. Arthur, chief of the Brotherhood of Locomotive Engineers, had many of the qualities of a statesman. He built up his organization to be the strongest of its kind among the labor unions. I enjoyed his confidence and friendship for many years.
There never was but one strike on the New York Central during my administration, and that one occurred while I was absent in Europe. Its origin and sequel were somewhat dramatic. I had nearly broken down by overwork, and the directors advised me to take an absolute rest and a trip abroad.
I sent word over the line that I wanted everything settled before leaving, and to go without care. A large committee appeared in my office a few mornings after. To my surprise there was a representative from every branch of the service, passenger and freight conductors, brakemen, shopmen, yardmen, switchmen, and so forth. These had always come through their local unions. I rapidly took up and adjusted what each one of the representatives of his order claimed, and then a man said: "I represent the locomotive engineers."
My response was: "You have no business here, and I will have nothing to do with you. I will see no one of the locomotive engineers, except their accredited chief officer."
"Well," he said, "Mr. President, there is a new condition on the road, a new order of labor called the Knights of Labor. We are going to absorb all the other unions and have only one. The only obstacle in the way is the locomotive engineers, who refuse to give up their brotherhood and come in with us, but if you will recognize us only, that will force them to join. Now, the Brotherhood intends to present a demand very soon, and if you will recognize our order, the Knights of Labor, and not the Brotherhood of Locomotive Engineers, we will take care of what they demand and all others from every department for two years, and you can take your trip to Europe in perfect peace of mind. If you do not do this there will be trouble."
I declined to deal with them as representatives of the Brotherhood of Locomotive Engineers. Then their spokesman said: "As this is so serious to you, we will give you to-night to think it over and come back in the morning."
I immediately sent for the superintendent of motive power and directed him to have posted by telegraph in every roundhouse that the request of the Brotherhood of Locomotive Engineers, of which this committee had told me, had been granted. The next morning the committee returned, and their leader said: "Well, Mr. President, you have beaten us and we are going home."
Then I appealed to them, saying: "I am a pretty badly broken-up man. The doctors tell me that if I can have three months without care I will be as good as ever. You must admit that I have at all times been absolutely square with you and tried to adjust fairly the matters you have brought to me. Now, will you take care of me while I am absent?"
They answered unanimously: "Mr. President, we will, and you can be confident there will be no trouble on the New York Central while you are away."
I sailed with my mind free from anxiety, hopeful and happy, leaving word to send me no cables or letters. After a visit to the Passion Play at Ober-Ammergau in Upper Bavaria, I went into the Austrian Tyrol. One night, at a hotel in Innsbruck, Mr. Graves, a very enterprising reporter of a New York paper, suddenly burst into my room and said: "I have been chasing you all over Europe for an interview on the strike on the New York Central." This was my first information of the strike.
As soon as I had left New York and was on the ocean, the young and ambitious officers who were at the head of the operations of the railroad and disapproved of my method of dealing with the employees, discharged every member of the committee who had called upon me. Of course, this was immediately followed by a sympathetic outburst in their behalf, and the sympathizers were also discharged. Then the whole road was tied up by a universal strike. After millions had been lost in revenue by the railroad and in wages by the men, the strike was settled, as usual, by a compromise, but it gave to the Knights of Labor the control, except as to the Brotherhood of Locomotive Engineers. The early settlement of the strike was largely due to the loyalty and courage of the Brotherhood.
During my presidency I was much criticised by the public, but never by the directors of the company, because of my activities in politics and on the platform. For some time, when the duties of my office became most onerous, and I was in the habit of working all day and far into the night, I discovered that this concentrated attention to my railroad problems and intense and continuous application to their solution was not only impairing my efficiency but my health. As I was not a sport, and never had time for games or horses, I decided to try a theory, which was that one's daily duties occupied certain cells of the brain while the others remained idle; that the active cells became tired by overwork while others lost their power in a measure by idleness; that if, after a reasonable use of the working cells, you would engage in some other intellectual occupation, it would furnish as much relief or recreation as outdoor exercise of any kind. I had a natural facility for quick and easy preparation for public speaking, and so adopted that as my recreation. The result proved entirely successful.
After a hard day's work, on coming home late in the afternoon, I accustomed myself to take a short nap of about fifteen minutes. Then I would look over my tablets to see if any engagement was on to speak in the evening, and, if so, the preparation of the speech might be easy, or, if difficult, cause me to be late at dinner. These speeches were made several times a week, and mainly at banquets on closing of the sessions of conventions of trade organizations of the country. The reciprocal favors and friendship of these delegates transferred to the New York Central a large amount of competitive business.
While I was active in politics I issued strict orders that every employee should have the same liberty, and that any attempt on the part of their superior officers to influence or direct the political action of a subordinate would be cause for dismissal. This became so well known that the following incident, which was not uncommon, will show the result.
As I was taking the train the morning after having made a political speech at Utica, the yardmaster, an Irishman, greeted me very cordially and then said: "We were all up to hear ye last night, boss, but this year we are agin ye."
The position which this activity gave me in my own party, and the fact that, unlike most employers, I protected the employees in their liberty and political action, gave me immense help in protecting the company from raids and raiders.
We had a restaurant in the station at Utica which had deteriorated. The situation was called to my attention in order to have the evils corrected by the receipt of the following letter from an indignant passenger: "Dear Mr. President: You are the finest after-dinner speaker in the world. I would give a great deal to hear the speech you would make after you had dined in the restaurant in your station at Utica."
After thirteen years of service as president I was elected chairman of the board of directors. Mr. Samuel R. Callaway succeeded me as president, and on his resignation was succeeded by Mr. William H. Newman, and upon his resignation Mr. W. C. Brown became president. Following Mr. Brown, Mr. Alfred H. Smith was elected and is still in office. All these officers were able and did excellent service, but I want to pay special tribute to Mr. Smith.
Mr. Smith is one of the ablest operating officers of his time. When the United States Government took over the railroads he was made regional director of the government for railroads in this territory. He received the highest commendation from the government and from the owners of the railroads for the admirable way in which he had maintained them and their efficiency during the government control.
On the surrender of the railroads by the government, Mr. Smith was welcomed back by his directors to the presidency of the New York Central. The splendid condition of the Central and its allied lines is largely due to him. During his service as regional director the difficult task of the presidency of the New York Central was very ably performed by Mr. William K. Vanderbilt, Jr. Though the youngest among the executive officers of the railroads of the country, he was at the same time one of the best.
Among the efficient officers who have served the New York Central during the time I have been with the company, I remember many on account of their worth and individuality. H. Walter Webb came into the railway service from an active business career. With rare intelligence and industry he rapidly rose in the organization and was a very capable and efficient officer. There was Theo. Voorhees, the general superintendent, an unusually young man for such a responsible position. He was a graduate of Troy Polytechnical School and a very able operating officer. Having gone directly from the college to a responsible position, he naturally did not understand or know how to handle men until after long experience. He showed that want of experience in a very drastic way in the strike of 1892 and its settlement. Being very arbitrary, he had his own standards. For instance, I was appealed to by many old brakemen and conductors whom he had discharged. I mention one particularly, who had been on the road for twenty-five years. Voorhees's answer to me was: "These old employees are devoted to Toucey, my predecessor, and for efficient work I must have loyalty to me."
I reversed his order and told him I would begin to discharge, if necessary, the latest appointments, including himself, keeping the older men in the service who had proved their loyalty to the company by the performance of their duties.
Mr. Voorhees became afterwards vice-president and then president of the Philadelphia and Reading. With experience added to his splendid equipment and unusual ability he became one of the best executives in the country.
Mr. John M. Toucey, who had come up from the bottom to be general superintendent and general manager, was a hard student. His close contact with his fellow employees gave him wonderful control over men. He supplemented his practical experience by hard study and was very well educated. Though self-taught, he had no confidence in the graduates of the professional schools.
In selecting an assistant, one of them told me that Toucey subjected him to a rigid examination and then said: "What is your railroad career?"
"I began at the bottom," answered the assistant, "and have filled every office on my old road up to division superintendent, which I have held for so many years."
"That is very fine," said Toucey, "but are you a graduate of the Troy Technical School?"
"No, sir."
"Of the Stevens Tech.?"
"No, sir."
"Of Massachusetts Tech.?"
"No, sir."
"Then you are engaged," said Toucey.
Mr. Toucey was well up-to-date, and differed from a superintendent on another road in which I was a director. The suburban business of that line had increased very rapidly, but there were not enough trains or cars to accommodate the passengers. The overcrowding caused many serious discomforts. I had the superintendent called before the board of directors, and said to him: "Why don't you immediately put on more trains and cars?"
"Why, Mr. Depew," he answered, "what would be the use? They are settling so fast along the line that the people would fill them up and overcrowd them just as before."
I was going over the line on an important tour at one time with G. H. Burroughs, superintendent of the Western Division. We were on his pony engine, with seats at the front, alongside the boiler, so that we could look directly on the track. Burroughs sat on one side and I on the other. He kept on commenting aloud by way of dictating to his stenographer, who sat behind him, and praise and criticism followed rapidly. I heard him utter in his monotonous way: "Switch misplaced, we will all be in hell in a minute," and then a second afterwards continue: "We jumped the switch and are on the track again. Discharge that switchman."
Major Zenas Priest was for fifty years a division superintendent. It was a delightful experience to go with him over his division. He knew everybody along the line, was general confidant in their family troubles and arbiter in neighborhood disputes. He knew personally every employee and his characteristics and domestic situation. The wives were generally helping him to keep their husbands from making trouble. To show his control and efficiency, he was always predicting labor troubles and demonstrating that the reason they did not occur was because of the way in which he handled the situation.
Mr. C. M. Bissell was a very efficient superintendent, and for a long time in charge of the Harlem Railroad. He told me this incident. We decided to put in effect as a check upon the conductors a system by which a conductor, when a fare was paid on the train, must tear from a book a receipt which he gave to the passenger, and mark the amount on the stub from which the receipt was torn. Soon after a committee of conductors called upon Mr. Bissell and asked for an increase of pay. "Why," Bissell asked, "boys, why do you ask for that now?"
After a rather embarrassing pause the oldest conductor said: "Mr. Bissell, you have been a conductor yourself."
This half century and six years during which I have been in the service of the New York Central Railroad has been a time of unusual pleasure and remarkably free from friction or trouble. In this intimate association with the railroad managers of the United States I have found the choicest friendships and the most enduring. The railroad manager is rarely a large stockholder, but he is a most devoted and efficient officer of his company. He gives to its service, for the public, the employees, the investors, and the company, all that there is in him. In too many instances, because these officers do not get relief from their labor by variation of their work, they die exhausted before their time.
The story graphically told by one of the oldest and ablest of railroad men, Mr. Marvin Hughitt, for a long time president and now chairman of the Chicago and Northwestern Railway, illustrates what the railroad does for the country. Twenty-five years ago the Northwestern extended its lines through Northern Iowa. Mr. Hughitt drove over the proposed extension on a buckboard. The country was sparsely settled because the farmers could not get their products to market, and the land was selling at six dollars per acre.
In a quarter of a century prosperous villages and cities had grown up along the line, and farms were selling at over three hundred dollars per acre. While this enormous profit from six dollars per acre to over three hundred has come to the settlers who held on to their farms because of the possibilities produced by the railroad, the people whose capital built the road must remain satisfied with a moderate return by way of dividend and interest, and without any enhancement of their capital, but those investors should be protected by the State and the people to whom their capital expenditures have been such an enormous benefit.
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