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At his office and library, he conferred unequaled in the history of this country, day and night with the heads of all the though paralleled, possibly, in other lands. banks, with the greatest private capital. No other man in our financial history ists in the country, with the officials of has left behind him so many tangible the Government responsible for finance; evidences of his creative power, or so and he personally made the policies, and many methods closely interwoven with put them into execution, which arrested the business life of a great nation. the money crisis of 1907 and gave the His death will probably lead to no sudden business world a chance to get out of its readjustment or disruption of any of the troubles by a slow, if painful, process of institutions or public functions with which liquidation of its resources.

he was connected. Yet the man is dead; IV

and his power and personality in the

business world cannot be passed down to It has often been said that this episode syndicates, to firms, or to corporations. was the crown of Mr. Morgan's career; Therefore, the business world will suffer and perhaps he will be remembered more a great change. for this than for any other of his accom- The passing away of such leaders as plishments. However that may be, it is Mr. Harriman and Mr. Morgan marks the agreed by all that no other man at that end of an epoch; and the next era in time could have assumed the financial American business life will be an era in leadership of the country as Mr. Morgan which syndicates and organizations will assumed it.

be the most powerful agencies, and they That panic made a policy which has will come under public control to a degree been followed by the house of Morgan that would be simply incomprehensible from that day to this. It seems to have to a man like Mr. Morgan. shown a necessity for concentrated leadership of the banking world. Recognizing the fact that Mr. Morgan personally For quite a time, Mr. Morgan had been could not live forever, and that no other practically a retired leader. He had taken single man seemed likely to be able to little active part in the many activities fill his place, the Morgan house set to and functions of the banking house which work so to concentrate the banking power bears his name. Nevertheless, he reof New York City that it would act as a mained to his death the undoubted leader unit in any great emergency, or on any of American business, so far as it is exgreat measure that might confront it. pressed in and represented by the operaTo that end, half a dozen of the largest tions of banking and finance. The banks and trust companies in the United confidence of the whole business comStates were brought either directly under munity in the firm and in the great banks the control of J. P. Morgan & Co., or and trust companies which he had piled into such close affiliation with that firm up around him since the panic of 1907 that they would undoubtedly act as a was based, to a striking extent, upon the unit in any such emergency or task. confidence of that community in the

Thus was created that concentrated integrity, courage, and ability of Mr. money power which has come to be Morgan himself. popularly known as a money trust. It is The continuance of that confidence dehardly probable that it will be able to pends hereafter not upon the power and maintain itself hereafter in face of the prestige of a man but upon the acts and loss of its leader and its presiding genius continuous policies of a firm and of a and in the face of a public clearly hostile group of banks and bankers who have to it. Be that as it may, the fact remains hitherto been held together and made one, that here, without the usual corporate as it were, by the name and association form and purely by virtue of his power, of Mr. Morgan. There is little doubt his wealth, and his integrity, Mr. Morgan that there will be in the financial comcreated an aggregation of banking power munity a shifting and moving about of

V

various men and various interests, such as catastrophes are but reminders of other followed the removal of Mr. Harriman floods of the past and prophecies of those from the railroad world. There may be, floods that are sure to come. and there probably will be, personal am- Probably the greatest task in the bitions developed within the Morgan physical upbuilding of the Nation is the groups which may find themselves too proper use of the rain and snow that falls much hampered and restricted by the in the Mississippi drainage basin and the community of interest in which they safe guiding of that water to the sea. dwell and which may seek new alliances If the Mississippi River and its tributaor try to carve out individual destinies ries, were once effectively controlled, the for themselves to the eventual disruption saving in flood damage alone would much of their own power.

more than pay the interest on any conIn spite of the constructive work and ceivable sum that could be spent on the the masterful leadership of Mr. Morgan controlling works, for every year the inand of his great deeds in the era that we finitely powerful streams of the Mississippi are now passing out of, a revision of the Valley run wild somewhere, usually in currency and banking laws, if a wise many places. So common is this that it is revision be made, will prevent any other not “news” unless the catastrophe is tresuch career, even if another such strong mendousanddramatic. Merely the negative personality were to arise. The possession advantage of escaping the damage from of such great power — or the possibility flood calls aloud for the control of the river. of its possession - does not fit into the But this is not the greatest of its adAmerican scheme of life or business. Mr. vantages. There are vast undeveloped Morgan's strict integrity, by the financial regions of rich lands, unborn towns, and code of his time, and the confidence that non-existent centres of trade that would this integrity inspired brought finance a be flourishing, helpful units if it were not very, very long way forward and upward for the fear of the river. For men and from the era of Jay Gould. But the money do not settle and build homes and concentration of credit which was in some industries within the probable reach of respects a fortunate result of his integrity, unbridled waters. under our present bad financial laws, would How much the Ohio, the Missouri, and in itself again be improper and immoral. the Mississippi can be economically used

Thus ends a financial dynasty and an for transportation is an unsettled point. economic epoch.

As they flow now, building bars of débris,

cutting their banks, flooding the countryTO END FLOODS

side at highwater and running low in

droughts, they are less and less useful. T HE public has already begun to Kept within their banks, relieved of some

pay millions of dollars to repair of their débris, and with a more even flow,

railroad bridges and tracks and they would at least have a better chance telephone lines that were washed away of regaining their old usefulness as comby the recent floods. Counties and town- mon carriers. ships are at work repairing roads; cities Above the fall line of the rivers, where and towns are cleaning up their débris, the possibilities of navigation usually counting their losses, and looking over cease, the sites for water power developthe cost of emergency relief work. Fac- ment are found. For this use, also, an even tories and stores are counting the cost of flow is one of the greatest assets. damaged plants and ruined goods, and The control of the great river means an individuals are trying to rehabilitate incalculable increase in wealth to the wrecked homes and washed-out farms; Nation. The United States Engineer and all this has to be done in the face of Corps and the river commissions have a month's interruption of business. Last brought the lower river under partial year it was in the lower Mississippi Valley. control. By the Eads jetties and related This year it is in the Ohio Valley. Both works the passes at its mouth have been

opened to navigation. By a superb levee Whenever a new piece of land is drained system flood-waters have been barred and reclaimed (as is being done in Arkanfrom the bottom lands. But these works, sas) some other section is forced to receive as good as they are, are not aimed at the the extra pressure of the river. And these root of the evil.

intimate inter-relations go back up from In the 191 trillion cubic feet of water the Mississippi where it empties into the which the Mississippi yearly carries to Gulf to the veriest little streamlet that the sea, there are 400 million tons of the begins in a plowed field on the western country's richest soil. A river carrying slopes of the Appalachians or in the forests silt in this manner when flowing slowly on the eastern slopes of the Rockies. deposits the silt and forms bars, which T here have probably always been floods change its channels and find new places in this country, but the cutting of the to attack when the floods come again. forests and the careless tillage of the soil

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A silt-carrying river when flowing fast have increased their size and frequency. acts like a great file, scouring out its bot- Nearly all the rain that falls, as explained tom and cutting its banks. The lower by Professor T. W. Chamberlain, of Mississippi is gradually building its bottom Chicago, should go into the soil and thence up higher and higher during the months into the underdrainage, coming out slowly of sluggish flow, so that the levees have and steadily by seepage and by springs to be built higher and higher to control into the streams clear and pure. Being the water at flood time. If straightened fed thus fairly uniformly, these streams and confined enough to accelerate its flow should be the least destructive and the sufficiently to keep it from building up most adaptable for power and navigation, its bottom during the low stages, it would and these virtues would be felt all the way be too powerful for any kind of control from their small sources to the Gulf. But during its high stages. The vast sections where the rain falls upon denuded forest that used to be overflowed took enough slopes, or upon farm land left in such water to relieve the pressure elsewhere. condition that it will not absorb the rain

fall, it does not seep in but rushes away OUR TRADE TO THE SOUTH as foul erosive floods on the surface, wasting soil and plant food, gullying the surface, URTHER facts concerning the flooding the valleys, silting the pools, H vast possibilities for trade that washing away reservoirs and dams, barring T open in South America to the the streams, and carrying its multifarious manufacturers and exporters of the United influences of destruction through the long States appear in an analysis of “Latin course to the ocean.

American Foreign Trade in 1911” in a The most obvious method of control, recent bulletin of the Pan-American Union. the building of levees, we already practise The total imports of the ten South Amerion a tremendous scale, but not on a scale can republics during 1911 were valued at commensurate with our needs, nor upon $893,000,000. Nearly $130,000,000 worth a comprehensive enough plan; the build- of these imports came from the United ing of storage reservoirs to catch flood States. But Great Britain supplied more waters is still chiefly in the plan stage; than $261,000,000 worth of them, and forestry and proper tillage are still, in Germany more than $165,000,000. France spite of the progress of the last few years, sent only about $78,000,000. generally unobserved.

But when the net value of the goods The proper control of this one great sold to South America is figured, the drainage system, beginning in the forests United States probably makes the poorest and on the farms, including storage reser- showing of all. The reason is that the voirs, power plants, dredging, levees, and goods sent by this country are mostly raw revetments, and extending through nearly materials or goods upon which the work half the states of the Union - this is of fabrication was so slight that their value probably the most pressing physical prob- was little increased by the skilled labor of lem confronting the Nation. The political American artisans. The goods from the difficulty is to keep the vast engineering other countries, however - and especially problem out of politics, as the construction the imports from France - were generally of the Panama Canal has been kept out, much more highly finished products, upon only it is a much harder task. Panama is which the French people made not only not in any Congressional district.

the profit from the sale of raw materials There is no local interest to bring pres but a larger profit from the application of sure in favor of one particular scheme or brains, mechanical skill, and organized another. In the great interior basin are manufacturing industry. In other words, thousands of local interests which, if per- France and Germany and Great Britain mitted to do so, would wreck any com- made several profits upon every dollar's prehensive scheme to treat the problem worth of goods against only one profit as a whole. The question comes also of upon the American goods. who should pay the bills, the National Nevertheless, American manufacturers Government, the states, or the smaller are making headway in South America units of government; or, if they share the especially manufacturers of farm impleexpense, in what ratio should they share it. ments, of windmills, of electrical supplies,

The problem of the Mississippi is the and of railroad equipment. These prodproblem of the other drainage systems of ucts have been pushed successfully because the country, but they are, of course, on a they are manufactured by corporations of much smaller scale. If it can be suc- such gigantic size that they can overcome cessfully solved they can be handled also. the great disadvantages of imperfect bank

To formulate a plan comprehensive ing facilities and of the general lack of enough to solve this great problem in its American salesmen who are trained in the engineering, political, and financial aspects languages and trade customs of the South. is a task worthy of any administration of The United States should find in South economic statesmen. It is an imperative America for many years to come a sufduty before the Nation, the next great ficient outlet for the products of the new task of conservation,

era of export trade.

THE PASSING OF “DOLLAR DIP- American people, cannot guarantee their LOMACY

collection, whatever other governments

may guarantee to do. RESIDENT WILSON will have no Apply this same policy to Central Am"dollar diplomacy" in China nor, erica. If we guarantee American loans to

inferentially, elsewhere. “Dollar those governments, we thereby guarantee diplomacy" meant the promise by the also European loans to them. For we Government to use force, if need be, to will not permit any European government collect the loan that American citizens to seize American territory; and, if we would make to the Chinese Government, as use force to collect debts due to our citithe principal European governments were zens, we must either permit other governto use force, if need be, to collect loans ments the same privilege or else collect made by their citizens. On these conditions their debts ourselves. money was to be lent to China. The This incident admirably illustrates the whole plan, 'so far as we are concerned, difference between the conception of originated with the preceding Adminis- government as an ally of business and the tration, which asked American bankers to conception of it as an agency of order and enter the syndicate. It did not originate justice, “of the people, by the people, and with the bankers.

for the people.” The conception of it as As an American policy, the plan would an ally of business — that is, of one class never bear analysis. For it meant first of men — has had expression and exempliour prescribing the kind of taxes the fication in many ways for a long time — Chinese Government should levy, and in so many ways and for so long a time that secondly, it meant the putting of our navy it has become warp and woof of the and army at the service of American thought of a large part of the American bankers, if they should need it, for the people. It is a fundamentally erroneous collection of their debts — in a word, to view of a republican government, apply help them do their business safely. To it how you will, whether by protective state the case in this way is to make its tariffs or by river-and-harbor bills or by impropriety obvious.

any form of special legislation. Yet as the policy of dollar diplomacy President Wilson is to be congratulated arose it was not so simple as this statement on having had presented to him so soon makes it appear. China needs money. an opportunity to apply his conception of It must borrow it from the great bankers our Government's proper functions. of Europe. The great bankers of Europe know the land-hunger of their govern

A GOOD RIDDANCE ments. The partition of China was an old dream that came near coming true a THE little postmasters, as other dozen years ago. May it not come true

little public servants, cause much yet? No great European Power is willing

more trouble than they are worth. for the other European Powers to gain a Mr. Taft put the whole army of the fourthpossible advantage in China to its exclu- class in the classified service — a suspicious sion. If one should guarantee a loan action, as the spoilsmen regarded it, made by its citizens, the others would because this fixed Republicans in office. follow. Well, then, if the Powers of Eur. But the Democratic Administration has ope are to have this hold on China, does met this situation very wisely. Let so not our hope of influence and of trade many of them, it says, as can stand a fair require that we should be in the “deal?” civil service test remain; but let all be put

This is plausible and insidious reasoning. to the test. That's fair. Several thouWe do not want Chinese territory. As for sands of them have resigned because their trade, it does not follow a loan, at least offices were not worth the trouble of till after foreclosure. American bankers standing an examination. These have run may make loans where they will. But at the first mention of merit, and their the American Government, that is, the places are made vacant without scandal.

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